Patrick A. Palace
Governor, District 6
The New Adventures of the BOG: A Veterinary Clinic; The UBE, MPRE, or MBE; and WSU
November 2009
Pullman? That was the question I asked when looking at the WSBA Board of Governors' travel schedule for October. While thinking through the trip to Pullman, I imagined the WSU campus, blue sky, and sunny weather in farm country. When I arrived in Pullman on October 22, there was not any blue sky and sunshiny weather. Instead, it poured down rain. Nevertheless, spirits were not dampened by the weather and the Governors had a great tour of WSU, met with the Dean of the University of Idaho Law School, toured the truly amazing WSU School of Veterinary Medicine, and stayed in a small-town hotel in the fine city of Moscow, Idaho.
Should We Change Our Bar Exam?
The WSBA is currently evaluating whether our bar examination should change from the current all-essay exam to the use of a uniform bar examination (UBE) created by the National Conference of Bar Examiners. We are considering whether we should keep our bar exam as it currently exists, modify the bar examination to include the uniform bar examination and/or the Multistate Professional Responsibility Exam (MPRE), or a combination. Overall, five different combinations of testing are being considered.
There are a couple of reasons for these considerations. At the heart of the issue, there is concern that the bar examination is becoming too costly for recent law school grads.
There are a number of other competing factors that are also being weighed. Those factors include: (a) portability (the portability of lawyers to practice across the state lines without having to take multiple state bar exams); (b) the cost savings to the WSBA by using a more standardized bar examination; and (c) keeping up with national trends by using more nationalized bar examination methods.
Additional considerations include: (a) the importance of, and need for, Washington-specific law testing and (b) concerns that the National Bar Examinations may have a disparate impact upon diversity within our bar, and may screen out minorities.
The WSBA Program Review Committee put together an excellent set of documents for the purpose of this discussion, and if this issue is of importance to you, then I would encourage you to take a look at the Board of Governors materials. The BOG will likely discuss the future of the bar exam during our next meeting on December 4 and 5.
Hardship Exemptions for Bar License Fees
Should the WSBA grant hardship exemptions for people who have physical or mental disabilities and/or financial hardships that make it difficult for them to pay bar license fees? The Bylaw Review Task Force was charged with the task of considering whether a hardship exemption should be created, and if so, to draft language to be considered by the BOG. In these hard economic times, Board members have sympathy for lawyers who may find themselves unemployed and in financial straits. Some members of the Board of Governors believe that a hardship exemption should be adopted. One such proposal would allow a one-time deferral of bar license fees. Others do not believe that the bar license fees were so expensive as to pose a hurdle for a practicing lawyer to continue to practice law and, indeed, are simply the cost of doing business. This issue will be debated in future meetings, but in the meantime, I am happy to hear your input on this issue before I cast my vote.
Pierce County Welcomes the WSBA Board of Governors
As the Governor of the Sixth Congressional District, I am happy to welcome our Governors and liaisons from across the state to Tacoma for our meeting December 4 and 5 at Hotel Murano. I welcome and encourage members of the bar to attend any of our meetings, see the process, and meet the Governors and liaisons. This is your bar and we are your representatives. I encourage all of you, and in particular members who practice in Pierce County, to join us in December.
For the whole story…
During each meeting, it is not unusual for the BOG to review over a thousand pages of information. My report covers some of the highlights. However, if you want to learn about the other topics covered, or want to read about the issues I have discussed, in greater detail, then I invite you to access the BOG meeting materials directly. You can access this information at www.wsba.org/info/bog/default.htm (see "BOG Books" in the right sidebar).
I encourage you to e-mail me your thoughts and comments through the WSBA website, or you can e-mail me directly at patrickwsba@palacelaw.com.
Yours in service,
Patrick A. Palace
Changing of the Guard: Thank You, President Johnson, and Welcome, President Mungia
October 2009
The WSBA Board of Governors met in Seattle on September 24 and 25. This meeting concludes a busy year for your WSBA. With the closing of this meeting, we gave a heartfelt thank-you for the monumental work of President Mark Johnson. He has been tireless in his efforts to lead this Bar. He has shown incredible vision in his leadership. He has served five years as a member of the Board of Governors, as governor, president-elect, and then president. Mark Johnson's balance of high energy and a fabulous sense of humor, coupled with his dogged and efficient running of Board meetings, have made time on this Board very enjoyable. All of the governors and staff will miss Mark, although he will continue to serve as immediate past president. I wish him well as he returns to the practice of law, and I thank him for his considerable and selfless service to our Bar.
As with many things in life, when one door closes another opens. During this last meeting, the gavel changed hands from Mark Johnson to our very own Sal Mungia. Sal is a man who needs no introduction around here. We are very fortunate to have his energy as our new president. On the evening of September 25, while standing alone on stage before a rapt audience at the WSBA Annual Meeting, newly-minted President Mungia delivered an impassioned speech before some 460 dignitaries and members of our Bar. He was as powerful a speaker as I have seen, and left most, if not all, of us with tears in our eyes and with a sense of renewed purpose. Sal is a rare human. It is a gift to our profession that we have been given a leader with passion, intellect, and a clear vision of what justice and equality should look like in this day and age. Congratulations, Mr. President. Your day has arrived and we welcome it.
Now, on to the work of the BOG…
Change of Fortune: The Civil Legal Justice System Is Reviving
As you all know, there has been a civil legal justice crisis in our state with the loss of millions of dollars per year of IOLTA revenue. IOLTA revenues are at historic lows, with this year's revenue projected to be less than $2 million (compare this to 2007 revenue of $9.2 million and 2008 revenue of $4.7 million). After months of debate, hundreds of e-mails, and broad-based discussions, the BOG voted to allocate $1.5 million to help bridge the gap in funding. The BOG vote was sharply divided on the issue of funding $1.5 million, but united that the WSBA must join with LAW Fund and help encourage voluntary contributions. So far the joint fund-raising efforts have been effective. I am proud to say that members of our Bar have stepped up donations to the Campaign for Equal Justice. Currently, with the pace of private giving, we will exceed last year's fund-raising levels. Charitable giving is up 28 percent. And there is more good news. As a result of the WSBA's unprecedented efforts to protect the civil legal aid system, the Gates Foundation considered granting money to LAW Fund. After a presentation by the leaders of the Equal Justice Coalition and President Mungia, the Gates Foundation has pledged $3 million to support civil legal aid. The Gates Foundation grant was beyond anyone's wildest hopes and is unprecedented. Congratulations to the Legal Foundation of Washington, the Equal Justice Coalition, and LAW Fund. Everyone should be proud of the efforts to save civil legal justice this year. Please continue to give and support LAW Fund. Together we have come so far under nearly impossible odds, and together we will continue to demonstrate the greatness of our legal profession in this state.
"MY WSBA" Is Here
On October 15, the "myWSBA" website will make its official debut. "MyWSBA" will allow members of the Bar to take care of licensing and regulatory functions online.
Additionally, you can view and update your profile, which includes address, phone and fax, e-mail, website, etc; join a WSBA section; access Casemaker free legal research; register for a WSBA CLE seminar; shop at the WSBA store (order CLE recorded seminars, deskbooks, Resources, etc.); and more. Please note that you must have a valid e-mail address on file with the WSBA in order to use myWSBA.
WSBA Professionalism Outreach Initiative
The WSBA is developing an outreach program to our three law schools. This initiative would bring members of our Bar into Professional Responsibility courses to discuss ethics and professionalism in the practice of law. Students would benefit from the interaction and real-world discussions with practicing lawyers. A curriculum is currently being developed. The deans of each law school have embraced the program, as have the professors teaching the courses. This initiative is part of the WSBA's ongoing commitment to positively shape the development of law students and young lawyers to prepare them to enter our profession. The BOG unanimously adopted this new program.
RPC 1.3: What should you do to protect your clients if you can no longer practice law?
The BOG unanimously approved a recommendation for new language to be added in the comment section of RPC 1.5. Comment #5 was proposed by the "Planning Ahead Task Force" to prepare members for the potential that they might suddenly be unable to practice law due to death, disability, or incapacity. The proposed new comment states:
In complying with the duty to act with reasonable diligence, lawyers should plan for protecting client interest in the event of the lawyer's death, disability, impairment, or incapacity. The plan should be in writing and should designate a competent attorney who has agreed to make arrangements of the protection of client interests in the event of the lawyer's death, disability, impairment or incapacity. Such arrangements will typically consist of reviewing client files, notifying each client of the lawyer's death, disability, impairment or incapacity; returning client property; and determining whether there is a need to take other immediate protective action.
The proposed comment will be forwarded to the Supreme Court for adoption.
For the Whole Story…
During each meeting, it is not unusual for the BOG to review over a thousand pages of information. My report covers some of the highlights. However, if you want to learn about the other topics covered, or want to read about the issues I have discussed, in greater detail, then I invite you to access the BOG meeting materials directly. You can access this information at http://www.wsba.org/info/bog/default.htm (see "BOG Books" in the right side bar).
I encourage you to e-mail me your thoughts and comments through the WSBA website, or you may e-mail me directly at patrickwsba@palacelaw.com. Thank you for a great first year. This is an exciting time in our profession, and a time where the selfless actions of our members continue to confirm why I am proud to be a lawyer.
Yours in service,
Patrick A. Palace
Proposed Changes in Court Rules Will Affect the Practice of Family Law
July 2009
The WSBA Board of Governors met on July 22–25 at the Tulalip Resort near Marysville. The meeting included four days of activities, meetings, and receptions. We covered a wide range of topics, and heard reports from a number of committees, the most important of which came from the Court Rules and Procedures Committee, which is recommending significant (as well as small) changes to court rules at many levels including the RAPs, RALJs, MARs, and the Rules of Evidence. Similarly, the Local Rules Task Force recommended sweeping changes to the Civil Rules that everyone who practices family law should review.
Changes Recommended by the WSBA Court Rules Committee
The chair of the Court Rules Committee, Roger Wynne, provided extensive materials regarding recommended rules changes. The purpose of most of the proposed changes is to create consistency within the rules, to correct drafting errors, and to modify rules to reflect better practices. Specific rule changes were proposed by several groups and entities, including the Office of Public Defense, the Washington Appellate Lawyers' Association, and the Washington Association of Prosecuting Attorneys.
The Rules of Appellate Procedure (RAPs) were up for review in the review cycle and therefore had the greatest number of rule modifications. After a presentation by the Court Rules Committee and a rule-by-rule discussion, the WSBA Board of Governors adopted the Committee's proposed rule changes to RAP 5.2 and 12.5, and ER 1101(c)(3). In addition, the Board voted to endorse the Office of Public Defense's proposed amendments to RAPs 5.3, 15.2, 6.3, 9.2, 15.5, and forms 12, 12A, and 13 (with some minor corrections to the text of a few of the proposals), to endorse WALA's proposals to amend RAPs 9.6, 11.3 [with the addition of a suggested amendment to RAP 17.2], and 18.1; and to oppose amendments to RAP 10.2(f) and 10.6(d) that were suggested by a group of amici attorneys. The Board also endorsed a proposed amendment to RAPs 2.2(b)(6) submitted by the Washington Association of Prosecuting Attorneys, but opposed their proposed amendments to RAPs 2.2(a)(10) and (11), 2.2(b)(5), 12.3, 14.3, and 16.15 and RALJs 2.2(c)(2)(b), 2.2(c)(5), 9.3(c), and 10.2(a)(2). These recommendations now go to the Supreme Court.
Additional changes were suggested by the Court Rules Committee with regard to the MAR (Mandatory Arbitration Rules). However, action on MAR 3.2, 6.3, 6.4, and 7.1 was tabled and the proposed amendments were sent back to the Committee. In addition, the Board tabled action on a proposed amendment to CR 43, to allow the Committee to provide additional information on the federal court's application of the standard proposed by the Committee.
Significant changes regarding the discovery of electronically stored information (ESI) were also considered. Civil Rules 26, 33, 37, and 45 have substantial proposed modifications. No changes were adopted, but a vote on these rules is likely in September.
The approved suggested amendments will be sent to the Supreme Court for their review and approval, together with the Board's position on the amendments which were suggested by others. The complete detailed list of proposed changes can be found in the July BOG book, beginning on page 111. For more information, see the Committee meeting materials.
Perhaps the most sweeping rules changes affect the Civil Rules regarding family law. By way of history, in December 2008, the WSBA BOG reviewed the first report of the WSBA Local Rules Task Force and approved the task force recommendations:
• The Supreme Court to direct each county's Superior Court review and "clean up" its current local rules;
• The local courts to be assisted with this clean-up effort;
• During this "clean-up" phase, a moratorium on the promulgation of new local rules should be imposed; and
• Local rule oversight should be implemented by the Supreme Court.
In March 2009, Justice Charles W. Johnson wrote to the Superior Court, District Court, and Municipal Court Presiding Judges, requesting that each court review its local rules and make its best efforts to ensure compliance with GR 7. In June the Supreme Court met en banc and further endorsed this goal.
At the July Board meeting, the Local Rules Task Force presented its final draft of a set of proposed Family Law Civil Rules (FLCR). If approved by the Supreme Court, the FLCR would complement and supplement the existing Civil Rules, and are intended to greatly reduce the number of local rules. The changes are too numerous to discuss here; however, the Task Force created a PowerPoint outline describing the specific rules changes. If you practice family law, I strongly recommend that you look at these materials.
The Future of WSBA CLEs Just Got Even Brighter
Our CLE Department will be one of the best in the country at providing cost-efficient and information-rich programming. However, growth and improvement come only with investment in the future, and long-term, forward-thinking programming backed with a current, if not future-leaning, infrastructure. Therefore, the BOG has approved a long-term growth and development plan for the CLE Department to invest in technology, expand its member services, and further build programs to be competitive in the expanding Internet market.
Among the specific changes to WSBA-CLE, the BOG has authorized: 1) the development of an in-house CLE webcasting studio; 2) the creation and expansion of in-house online publication and legal research services; 3) the purchase of Learning Management System software to manage system-wide calendaring of educational programs; and 4) the purchase of a Learning Content Management System so our CLE Department can develop and implement greater online CLE programming including interactive online CLEs, improved material access, and better video and audio online. I am excited to see the new "products" CLE will be creating for us in the years to come.
Final Thoughts
This report and additional information is available on my personal WSBA website. I also encourage you e-mail me your thoughts and comments through the WSBA website, or you may e-mail directly at patrickwsba@palacelaw.com.
Yours in service,
Patrick A. Palace
WSBA Board of Governors Approve Civil Legal Aid Package
June 2009
The WSBA Board of Governors met on May 29 at the Access to Justice/Bar Leaders Conference in Yakima. The next BOG meeting is July 24–25, 2009, in Tulalip, Washington. Therefore, by the time you read this report, we will have completed two meetings. So, to catch you up on the summer's activities thus far, I am happy to report that in the month of June, the State Bar has made great strides to provide legal aid to those in need.
WSBA Home Foreclosure Legal Aid Project
All of us recognize that an economic crisis exists in our state that was created by the mortgage industry. The crisis has spread to affect nearly everyone, particularly those who are facing the loss of their home. In an effort to meet the overwhelming unmet legal need of families who are facing foreclosure, the WSBA, in partnership with Northwest Justice Project, has created a free legal assistance program to help Washington residents who are in danger of losing their homes. The WSBA Home Foreclosure Legal Aid Project was created and approved by the Board of Governors, and was implemented in June. It has since been endorsed by Governor Chris Gregoire, Chief Justice Gerry Alexander, and Attorney General Rob McKenna.
As part of the implementation process, the WSBA requested lawyers to volunteer to provide home foreclosure legal aid services. In a few short weeks after the creation of the program, 253 lawyers had signed up to volunteer. Free online training for attorneys was created that provides 2.75 CLE credits for those who volunteered to assist in the Home Foreclosure Legal Aid Project. Currently, there are nearly 350 lawyers throughout the state who have volunteered to participate in this program. A copy of the press release can be found at www.wsba.org/media/releases/hflap0609.htm. Homeowners who are in need of legal assistance can call 1-877-894-4663. If you wish to volunteer, please sign up at www.mywsba.org/.
The Passage of the Civil Legal Aid Compromise
As most lawyers know by now, the dramatic decline of already low interest rates, coupled with the large decrease in real estate transactions, caused an unprecedented drop in IOLTA revenues from their peak of $9,179,877 in 2007 to a mere $2,000,000 in 2009. As a result of this nearly $7.2 million dollar loss of IOLTA funds, volunteer legal services statewide were jeopardized.
After several months of discussions, public meetings, and a broad vetting process, the Board of Governors voted on three independent compromise proposals aimed at balancing the interests of saving the civil legal aid system with the financial and fiduciary responsibilities we as Bar members have to manage our Bar funds.
In the first part of this three-part compromise package, the Board of Governors voted to enter into a joint guideline agreement to define the terms of a new partnership between the WSBA and LAW Fund, wherein "the WSBA will lend its considerable energy, resources, and support to substantially upgrade the level of voluntary contributions from its members." It was agreed that a joint committee should be formed to include members of Legal Foundation of Washington, LAW Fund, members of the WSBA Board of Governors, and WSBA staff. This portion of the package was aimed at increasing charitable giving and support from within our legal community and to provide long-term stability to our civil legal aid system at the local and statewide levels.
Second, the Board voted to craft a pilot WSBA-sponsored statewide "low bono" legal services delivery program for the Board of Governors to consider in the 2010 budget cycle. The BOG recognized that the time had come to build a new model for the delivery of legal services that provides services on a sliding need-based structure where recipients pay a portion of their own legal fees. The motion passed unanimously.
Finally, after a lengthy debate and a close vote, the Board of Governors voted to appropriate a onetime grant of $1.5 million dollars from WSBA reserves to buffer the civil legal aid temporary revenue shortfall anticipated in 2010 and 2011.
As a result of the actions taken by the Board of Governors, we as a Bar have given critical short-term financial support and created long-term infrastructure solutions to moderate against cyclical instabilities inherent with reliance on IOLTA funds. We have given support in a time of crises to those in legal need, and at the same time have done so while being fiscally conservative with Bar funds and in a manner that will not compromise Bar regulatory activities or member services.
Our New 2009-2010 President Elect, Steve Toole
The WSBA BOG also interviewed candidates for the WSBA President Elect position. Congratulations to Steve Toole, of Bellevue, who has been elected our WSBA president-elect for 2009–2010, and WSBA president 2010–2011.
Final Thoughts
This report and additional information is also available on my personal WSBA website that can be found at www.wsba.org/info/bog/patrickpalace.htm. I also encourage you e-mail me your thoughts and comments through the WSBA website, or you may e-mail directly at patrickwsba@palacelaw.com.
Yours in service,
Patrick A. Palace
Taking Action to Save the Civil Legal Aid System
May 2009
The WSBA Board of Governors met April 24-25 in Richland, Washington. As usual, we were given a full agenda, over one thousand pages of materials, and some 16 "action items" on which we debated and voted. Among the many items considered, we heard recommendations from Task Force 4 of the Discipline Review Committee regarding the ABA's Discipline Review Recommendations, discussed a video conferencing proposal to allow video conferencing at the WSBA offices, and considered recommendations from the Program Review Committee. We were briefed by the WSBA Committee for Diversity and chose a new Chief Hearings Officer. We nominated members for the Washington State Board of Continuing Legal Education (MCLE Board), voted against modifying WSBA long-term disability and health insurance benefits, and recommended amicus curiae participation in a case of first impression alleging racial discrimination by a jury against a lawyer.
However, the Board of Governors spent the majority of the Saturday meeting hearing testimony regarding the Civil Legal Aid.
The Civil Legal Aid Crisis
Before we can discuss a solution, allow me to discuss the crisis for a moment. The crisis starts with the economic downturn's effect upon the working class. Unemployment in March of this year is up to 9.2% and expected to peak over 10% this summer. 180,000 people in Washington have been laid off from their work and some 327,000 people are unemployed in Washington currently. Foreclosures have skyrocketed. One in every 450 homes in Pierce County is in foreclosure. In February of this year, 971 new foreclosures were filed in King County, 694 in Pierce County, 478 in Snohomish County, and 388 in Clark County. Bankruptcy filings in January 2009 increased by 50% over the same period a year ago.
The dramatic lowering of already low interest rates, coupled with the large decrease in real estate transactions, then caused an unprecedented drop in IOLTA revenue. IOLTA revenues in 2007 were $9,179,877; in 2008 they were reduced to $4,691,500. In 2009, the funds have continued to shrink and the projected gross IOLTA revenue is anticipated to have been reduced another $2.7 million, down to a mere $2 million. Over a three-year time period, IOLTA revenues have shrunk from $9.2 million down to $2 million revenue for a net loss of $7.2 million.
What does this loss mean to counties like Pierce County, you may ask? This year's Pierce County's volunteer legal service budget is $180,000, of which $142,700 was given (granted) by the Legal Foundation of Washington from IOLTA monies. All but $37,000 of the Pierce County VLS budget came from IOLTA dollars.
Last year in 2008, Pierce County VLS opened approximately 1,400 cases for low-income individuals. By April of this year, Pierce County VLS had already opened 800 cases. Pierce County Volunteer Legal Services program expects approximately 2,000 new cases by the end of this year.
At the State level, the numbers are similarly skyrocketing. In one week alone in January of this year, 1,398 people called Northwest Justice Project's legal aid line during office hours. Another 200 attempted to call before or after office hours that same day.
Legal need among the poor both locally and statewide is escalating, while at the same time, the sources of legal funding are depleting. Laurie Davenport, Program Director of Tacoma-Pierce County Bar Association Volunteer Legal Service Program has been clear that without the IOLTA monies from Legal Foundation of Washington, Pierce County may lose all or a substantial portion of our Tacoma-Pierce County Pro-bono program in 2010 unless we immediately find alternate sources to fund our program. Unfortunately, this scenario is being played out county by county throughout this state as each Volunteer Legal Service Program faces the potential of closure next year.
Proposal To Fund CLA
You may recall that last month I focused my governor's report on the proposal by President Mark Johnson to implement a $70 annual assessment (creating the Washington Lawyers' Fund for Civil Justice) to fund the Civil Legal Aid System. Since President Johnson's article, I've had the opportunity to speak at bar functions, including several TPCBA meetings, two Kitsap County Bar meetings, as well as other specialty bar meetings, including the WSAJ (formerly WSTLA) Board of Governors.
I invited each of you to e-mail me with your thoughts and concerns and have received dozens of e-mails and calls. I am grateful for your input. It is good to live among members who care about their Bar and their voluntary legal service program. Your responses have been mixed. Some of you do not support any use of mandatory dues, while others fully endorse the use of your money to fund CLA. I have responded to those who have e-mailed me, printed each e-mail, and forwarded all your e-mails to the WSBA.
When I arrived at the Board of Governors meeting in Richland in April, I was armed with your opinions, and those of members around the Bar. I had reviewed letters and reports from a myriad of organizations. At the meeting, the BOG heard testimony from clients and presentations from numerous civil legal aid groups, as well as individuals and organizations like the Farm Bureau, who opposed funding the Civil Legal Aid System. However, no vote was taken by the BOG. Because of the complexity of this issue, a special WSBA BOG meeting was called to order May 13 to review additional proposals. Both Sal Mungia and I submitted separate proposals for consideration. If you wish to see the proposals you may find them at
www.wsba.org/info/bog/mayspecialmeeting09.htm.
My proposal recommends that funding be provided to support Civil Legal Aid, but not from member assessments at this time. I have advocated that funding should be raised from WSBA CLE reserves, and the focus of the funding should be from a large and powerful campaign to voluntarily raise funds from members of our Bar and bar organizations as well as outside sources.
Other proposals have suggested that the WSBA loan money to LAW Fund for payment at a later time, and that the WSBA's operating budget be cut and the savings used to support Civil Legal Aid.
A proposal will be adopted in Yakima on May 29, after more debate and testimony. As of the date of this writing, the debate how to fund the Civil Legal Aid deficit continues. Today, I cannot tell you what the final details of the Legal Civil Aid proposal will look like when it is finalized by the Board of Governors, but I strongly suspect that the largest single funding source for Civil Legal Aid will be charitable donations from us, members of the Bar.
If our Civil Legal Aid System is to be saved, families kept from eviction, domestic violence victims assisted, and tens of thousands of needy families and children provided essential services, then it is we who must bolster this failing and absolutely necessary system of legal assistance.
We are in a desperate crisis where the need for Civil Legal Services pro-bono and low-bono are sky-rocketing, while at the same time the funding to support these programs has crashed to a level that we have not seen before during periods of such unprecedented need. I am confident we will rise to meet this challenge and appreciate the thoughts and work that so many WSBA member statewide and locally have put into finding the best possible answer.
Final Thoughts
Please visit the WSBA website to obtain additional information. You may also e-mail me through the website or directly at patrickwsba@palacelaw.com. I welcome your thoughts, concerns, questions, and/or support.
Yours in Service,
Patrick A. Palace
Notes From the Gov
March 2009
Saving the Civil Legal Aid System, Taxes on Lawyers, Mandatory Fee Arbitration, and Joe Gordon at 100
The WSBA Board of Governors met in Seattle March 6 and 7. This meeting focused on a wide range of issues, from debating mandatory fee arbitration to working on mitigating the losses from the crisis in the funding for civil legal aid. Here are the highlights:
Discipline Review Committee Task Force 3 and 5: Is Mandatory Fee Arbitration a Good Idea?
Those of you who pay attention to BOG reports know that the WSBA has been reviewing 23 ABA recommendations to change our disciplinary system. Five task forces were created to study the recommendations of the ABA, and this month we heard from Task Forces 3 and 5. We reviewed six ABA recommendations for modifying the disciplinary system. Each of the recommendations was quite technical and none brought significant changes. From my position, most of the recommendations were all small fixes and reasonable modifications. Therefore, I will not discuss them, but for those who want all the details, you may access them here.
The only significant ABA recommendation was studied by Task Force 5 regarding Mandatory Fee Arbitration. By way of history, the BOG had previously voted to sunset the WSBA's two voluntary alternative dispute resolution programs (Mediation and Fee Arbitration) effective March 31, 2009.
The ABA recommended that "the court should institute mandatory arbitration of lawyer/client fee disputes." A first draft of amendments to the Admission to Practice Rules (APRs) were reviewed. The draft rules provided that if a client commenced a fee dispute resolution proceeding, that the lawyer "must" participate. The intent of the rule was to provide a mechanism for clients to have a fee dispute heard in a fair and impartial setting, with a procedure that was both efficient and cost-effective, and could quickly respond to resolve disputes using members of the bar as arbitrators.
I received over a dozen responses to my request that attorneys in the Sixth District provide feedback regarding this proposal. The most common concern revolved around any "mandatory" system. Others were concerned that this proposed rule would affect contingency fee attorneys more than hourly attorneys and was "unfair." Concerns were also raised that attorneys may have to travel across the state for a fee arbitration and lose valuable time at the office.
There was a spirited discussion by some members of the Board; the voices of our constituents statewide were heard via e-mail, and well represented by the members of the Board of Governors. Among those lawyers who e-mailed governors, there was virtually no support for the mandatory fee arbitration rule.
While I believe that our Bar would be bettered, and that the reputation of lawyers as providers of justice would be better served, if we were to create a program to resolve fee disputes in an efficient way, I was not convinced that this proposed rule as written would have best addressed the problem. I recommended that the rule be reworked to meet the concerns raised by lawyers in their e-mails. It was my hope that the rule would be sent back for further work-up to be brought back to us in the months to come for further review and redrafting, if necessary.
Unfortunately, the proposed ABA recommendation was not given a chance to be reworked. A motion was made to reject the rule as written. Because the rule was not acceptable as written, I voted with the other governors to reject the rule. The ABA recommendation was rejected by a nearly unanimous vote. As a result, a rule with a good heart, albeit incomplete drafting, was killed. There will be no mandatory fee arbitration at this time.
Saving the Civil Legal Aid System
The 2003 Task Force on Equal Justice Funding found more than 75 percent of low-income households in Washington faced at least one civil legal problem annually. The study also found that 85 percent of the problems were faced without legal assistance. In Washington, there are a number of civil legal aid providers to provide the absolutely essential civil legal aid to citizens across the state — providers such as the Northwest Justice Project, the Northwest Immigrant Rights Project, TeamChild, Columbia Legal Services, and over 20 county bar-sponsored volunteer legal aid programs including our own Pierce County VLS.
The Supreme Court established the Access to Justice Board (ATJ Board) in 1994. Fifteen years later, we have created the backbone of a successful and strong civil legal aid system to help those who need legal assistance the most. However, the current serious economic crisis that we now face threatens to not just undermine the civil legal aid delivery system, but to substantially eviscerate it in an unprecedented manner.
Consider these facts: IOLTA revenues in 2007 were $9,179,877; in 2008 they were reduced to $4,691,500. This has created a $5 million dollar reduction in funds for an organization that distributed $8.3 million in civil legal aid grants in 2007. Further worsening the situation is the state's budget woes which are currently predicted at $8.3 billion deficit. Budget cuts are inevitable and are expected to affect the Office of Civil Legal Aid (OCLA) which administers the civil legal aid money provided by the state. If OCLA's budget were cut by 20%, a real possibility, the effects would be felt far and wide.
WSBA President Mark Johnson's article in the April issue of Bar News details the real-world effect of a 20 percent cut of the civil legal aid as follows: The Northwest Justice Project would close four rural offices, "between 5,800 and 6,000 families facing domestic violence threats and threats to the safety of children" would not receive any legal assistance from NJP, "between 2,500-3,000 families facing eviction" would not receive help from NJP, and "between 12,000-15,000 families" would not receive limited assistance from volunteer attorneys and/or representation by specialty providers.
Never before has Washington dealt with such an enormous blow to the Civil Legal Aid System.
The Board of Governors have been dealing with this crisis and are focused on a series of actions that may mitigate and blunt the full force of the cuts that may devastate civil legal aid. However, in the end, a stop gap "fix" must be shouldered by us as a profession. If our civil legal aid system is to be saved, families kept from eviction, domestic violence victims assisted, and tens of thousands of needy families and children provided essential services, then it is we who must bolster this failing and absolutely necessary system of legal aid.
I encourage each of you to read President Mark Johnson's article in the April Bar News for a more in-depth discussion. It is important to have a complete understanding of this crisis. Dealing with this civil legal aid crisis may be the most important step we take as lawyers to protect those members who are less fortunate in our communities.
The Board of Governors will be asked to vote on a proposal to add an additional $5.84 per month to Bar dues to support the civil legal aid system. It is important that all of us consider this issue carefully.
I encourage you to contact me with your thoughts, so that your voice may be heard at the Board of Governors meeting on April 24 and 25.
Tax on Legal Services
As of the time this article is going to press, we are at the sixtieth day of the 105-day legislative session. Today, there are ongoing discussions whether increased B&O taxes should be levied against lawyers. There is an alternate suggestion that a sales tax on services be created. It is clear that some members of the legislature are looking for a means to decrease the deficit. The WSBA does not support these tax proposals.
Joe Gordon Sr., Our Centenarian
In honor of Joseph H. Gordon Sr., who was born March 31, 1909, and was admitted to the State Bar in 1935, the WSBA Board of Governors passed a resolution recognizing Joe Gordon Sr. on his 100th birthday. The resolution recognizes that Mr. Gordon has practiced law for 73 years in this state, attended more than 100 consecutive meetings of the American Bar Association House of Delegates has served as President in many legal organizations including our own TPCBA, and served on the Board of Governors for the WSBA. Mr. Gordon's service to our legal community and to the community at large is unparalleled and for this we thank Joe Gordon Sr, and proudly honor him for his dedication and unwavering support of our Bar.
Final Thoughts
I welcome your thoughts, concerns, question, and/or support. Please e-mail me through the this website or directly at patrickwsba@palacelaw.com.
Yours in service,
Patrick A. Palace
Notes From the Gov
February 2009
The Board of Governors spent January 22nd and 23rd in Olympia, in what may well have been one of the most interesting Board of Governors meetings we have had thus far. Our president, executive director, and president-elect met with Governor Gregoire privately. The Board of Governors had a dinner with the Supreme Court and met the next day for a frank discussion of Bar issues. We also hosted a reception for State Legislators. As productive as these events were, the real action was in the public session BOG meetings. As you will see below, a number of significant issues came before the Board, including a discussions whether to radically change the disciplinary system, whether to create mandatory fee arbitration system and how to save our rapidly declining IOLTA revenues.
Complete Separation of the Disciplinary System from the WSBA: Good Idea or Bad?
The BOG reviewed ABA recommendations to change our disciplinary system. We heard presentations from a WSBA task force that studied the ABA's recommendations that: 1) the Office of Disciplinary Counsel be renamed the Office of Disciplinary Counsel of the Supreme Court of Washington; 2) the disciplinary system be separated physically and administratively from the Washington State Bar Association; and 3) recommended that the Supreme Court administer the disciplinary system.
The reporting WSBA task force was composed of a Supreme Court Justice, the President of the State Bar, the past President and the President-elect, the Executive Director, the Chief Disciplinary Counsel, a governor and a professor from the University of Washington School of Law.
The BOG discussed: (1) whether there needed to be additional protections against the possible exertion of influence by the WSBA upon disciplinary cases; 2) whether the Office of Disciplinary Counsel should be moved to, and administratively run by, the Supreme Court; 3) whether there was a need to enhance the public perception of the independence of the disciplinary system; and 4) whether there needed to be additional protections to allow the Office of Disciplinary Counsel to voice dissenting opinions to the Supreme Court.
In essence, the ABA's proposal was to shift the entire $4 million disciplinary system into the physical and administrative control of the Supreme Court. It is worth noting that, currently, the Supreme Court has delegated this authority to the State Bar to administer the disciplinary system through the WSBA and in the offices of the WSBA.
The task force did not recommend adoption of the ABA recommendation. They believed that the benefits derived from retaining the present system outweighed the risks inherent in making changes. The task force also rejected the ABA's recommendation because it believed it would create an additional and costly bureaucracy which would not ultimately improve the disciplinary system.
Many had concerns with recommending the wholesale shifting of the disciplinary system into the hands of the Supreme Court. We considered whether the Supreme Court would want to take over a $4 million-dollar-a-year disciplinary system. I shared these concerns. I was also wary that the public may perceive the Supreme Court as the judge, jury and prosecutor if the disciplinary offices were maintained at the Supreme Court where the Court would rule on disciplinary proceedings. Additionally, there was the sizeable fiscal note tied to the transition of discipline from the State Bar to the Supreme Court. Importantly, I did not hear significant or sufficient argument that the current system was broken. Since a major overhaul of the system over a decade ago, there was no evidence or any significant discussion that led me to believe that the quality of the disciplinary system would be improved with the proposed ABA changes. In light of the potentially significant costs, including the potential increase in bar dues to move the disciplinary system from WSBA to the Supreme Court, and because of the other issues raised above, I voted against the ABA recommendations.
In discussions among the governors, bar liaisons, and with Chief Disciplinary Counsel, many views were presented. In the end, after considering the presentation made by the task force including the well-reasoned dissenting opinion by Professor Andrews, and after considering the task force report, and the views of the governors and liaisons, the Board of Governors were divided on this issue. The final vote was split evenly. The tie was broken by the Chair who voted not to adopt the ABA recommendations and to adopt the recommendations of the task force to maintain the disciplinary system within the WSBA.
As a side note, a "Disciplinary Advisory Roundtable" (DAR) was recommended for a period of two years to act as an advisory council that would provide recommendations and input on disciplinary issues, and to provide an annual report to the Supreme Court and Board of Governors regarding the state of the disciplinary system. On the vote of 9 to 2, with 1 abstention, the DAR was adopted by the governors.
Mandatory Fee Arbitration
The Disciplinary Committee Task Force also reviewed an ABA recommendation that the current voluntary fee arbitration program be replaced with a mandatory fee arbitration program. Under the proposed program, if a dispute was commenced by a client, then it would be mandatory for the lawyer to participate in the arbitration regardless of the size of the dispute, the nature of the dispute or the merits of the claim. The task force neither endorsed nor rejected the ABA's recommendation. After a discussion, the issue was tabled for further study and recommendation. I would appreciate comments from you on this issue. It will be back before the Governors in the future.
Voting Online
In order to encourage members of the Bar to be more active in the election process of Governors, voting will begin occurring online for those with e-mail and who choose to vote online. For those who do not have e-mail or choose not to vote online, then the system of mailing hard copy votes to members of the WSBA will continue. This system will be in place before the next 6th District election.
Statute Law Committee
We were treated with a historically interesting discussion of the creation of the Code Reviser's Office and the role that the Reviser's Office has played with the creation and maintenance of the RCWs. There is far more history than can be recited here, but a tip to everyone of both historical significance and current significance is that all of the laws supporting the RCW's that were passed before 1950 may not include the actual language of the laws that were actually passed. The RCW before 1950 may contain paraphrased language that is not necessarily the exact language that was passed upon by the legislature. Therefore, if you have a case dealing with laws created before 1950 and statutory construction is at issue, you may be well served to review the actual law passed rather than relying on the RCWs.
IOLTA Comparability Rule
As a result of the economy and the decreased interest rates, the amount of interest paid out on our IOLTA accounts has been dramatically reduced. Money that has been historically created by IOLTA accounts is down 45%. Therefore, in effort to protect the programs that are supported with IOLTA funds, the Legal Foundation of Washington proposed a comparability rule that would require financial institutions who maintain IOLTA accounts to pay the same rate as they pay to non-IOLTA account customers. In other words, IOLTA accounts would be receiving interest rates comparable to the market rates for savings accounts. Some IOLTA accounts are as low as .10% or 1/10 of 1% interest. As a result of those low interest rates, IOLTA account income decreased from a little over $9 million to a little under $5 million between 2007 and 2008.
The Board of Governors unanimously passed the Legal Foundation of Washington's proposed rule changes to RPC 1.15(a), ELC 15.4 and 15.7. These proposed rule changes support the comparability rule and have now been sent to the Supreme Court for its consideration.
Sunsetting ADR Programming
The WSBA has had an alternative dispute resolution program since 1998. Despite the hopes that the ADR would be used by clients and lawyers alike, the volume of cases handled by the ADR program is low compared to the number of attorneys, clients, and cases in Washington. In fact, the ADR program has continued to operate at a significant deficit. Filing fees, while nominal ($75 - $125 per party), did not encourage the program's use. The WSBA made considerable efforts in the past to promote the program in Bar News and through other marketing. However, based on the declining use of the program and the significant cost of the program, the BOG Program Review Committee recommended sunsetting the WSBA's ADR Program. By a 7 to 1 vote, the Board of Governors did vote to sunset the ADR program. The ADR program will end March 31, 2009. The WSBA Service Center will refer callers to other panels.
WSBA Audit
The Washington State Bar Association hired an independent auditor to audit the balance sheet of the Washington State Bar Association. The report has come back quite favorably to our Association. The firm of Clark Nuber reported that the financial statements of the State Bar "present fairly, in all material respects the financial position of the Washington State Bar Association" and that such are "in conformity" with generally accepted accounting principles. Kudos to Deputy Director for Finance and Administration Julie Mass and the fine WSBA staff who so diligently manage and protect our Bar funds.
Final Thoughts
Because it is important that you as a member of the Bar have access to current issues before the Board of Governors and actions taken by the Board of Governors, a website has been created for lawyers in the 6th District. The website will include my articles regarding each Board of Governors meeting. The website will be updated as additional reports are created. You may visit the website at www.wsba.org/info/bog/patrickpalace.htm. Or go to www.wsba.org and follow the links (select "Board of Governors" in the left sidebar, and then select "BOG Roster and Contact Information").
As always, I welcome your thoughts, concerns, questions, and/or support. Please feel free to e-mail me at PatrickWSBA@PalaceLaw.com.
Yours in Service,
Patrick A. Palace
Notes From the New Gov
On December 5-6, 2008, your WSBA Board of Governors met in Bellingham. During this two-day meeting, we plowed through over a thousand pages of notebook materials, honored a local hero in the Whatcom County Bar Association, had lunch with the Whatcom County Bar and dinner with the Washington State Young Lawyers Division. I am happy to report that even with the full schedule, we completed the business of the Bar (at least for one weekend). Several important items were addressed and debated.
WSBA of Discipline Review Committee Task Force #2
First, as I reported last month, the WSBA Discipline Review Committee has created five task forces to review the 27 American Bar Association-recommended model changes. The Committee was asked to study these changes and determine whether such changes should be made to the Washington Lawyer Disciplinary system.
The BOG reviewed Task Force No. 2's recommendations and took actions accordingly. Six items were addressed. Amongst the highlights, the BOG voted to maintain a pool of 50 or more non-compensated hearing officers. It was debated whether the hearing officers should be compensated for their often significant periods of volunteer hours, and further debated whether the pool should be limited, so as to increase the number of hearings per hearing officer. Ultimately, it was determined that the integrity of our disciplinary system is best protected with the use of non-compensated, volunteer hearing officers.
Additionally, the ABA had recommended that volunteers in the disciplinary system should receive more intensive and mandatory formal training. As a result, the BOG approved a creation of a "Discipline Academy" for CLE credits that provide core training for all volunteers in the disciplinary system.
The BOG also approved a recommendation to fund and create an online resource to access disciplinary decisions.
Finally, action was taken to increase the compensation for counsel appointed in cases involving disability proceedings for members of our Bar. In an effort to increase the pool of counsel, compensation has been increased to $200/hour.
Lawyers' Fund for Client Protection Report
Last month, I reported on the Lawyers' Fund for Client Protection Fund; a fund that compensates victims who lose money through a lawyer's dishonest taking of, or a failure to account for clients' funds during representation. New fund payouts were close to $765,000, due to the actions of a single attorney. The balance of the fund was decreased by 75 percent. As a result of the increase of applications and the anticipation that additional and increasing numbers of applications will occur in the future, the BOG voted to accept the recommendation of the Lawyers' Fund for Client Protection Board to increase the annual assessment to $30 per year in order to maintain the fund and to fulfill its purpose of protecting clients.
Change in WSBA License Fees
The BOG also took action, based upon the recommendations of the Bylaw Review Committee, to simplify the license-fee structure. The old five-tier graduated fee schedule has been changed to a two-tier system, whereby attorneys in their first two years of practice pay 50 percent of full active fees and all other attorneys pay the full license fee. The new structure will begin 2010.
We will also have a simplified late-fee structure, effective in 2010. In short, license fees will be due and owing as of February 1st of each year. Effective in 2010, a flat 30 percent penalty will be assessed for all license fees paid after February 1st.
Also, good news about the license-fee packet that goes out every year; it has been significantly decreased in size from nine pages down to just one!
New Proposed Court Rules
The BOG voted to approve modifications to GR 34 to provide for waiver of filing fees and costs for those who meet the threshold for indigents (i.e., household income is at or below 125 percent of the Federal Poverty Guideline). This is an important step toward achieving greater access to justice for those who are impoverished. This rule will be submitted to the Supreme Court for review and comment.
WSBA Legislation
The WSBA Legislative Committee has been busy debating, improving and amending the RCWs. The BOG approved changes to six RCWs. With the BOG's approval, these WSBA-backed bills move to the Legislature. They may or may not be enacted this year, and may be modified.
One of the more significant changes may affect family law practitioners. RCW 26.09 has been amended to provide that a non-custodial parent-service member's inability to visit his/her children as a bona fide effect of their military duty cannot be used as the sole basis for modifying a parenting plan. The amendment also provides a mechanism for a deployed parent to delegate their time with the child to another person, subject to the limitations of RCW 26.09.191.
Additionally, the BOG voted to create the automatic restoration of voting rights to felons. If approved by the Legislature, this act would provide voting rights to felons upon their release from the Department of Corrections. This bill is intended to save the state money, to increase trust in the election process and to simplify the current system.
Washington State Bar Foundation
Former WSBA President and current President of the WSB Foundation, Ron Ward, gave a presentation regarding the state of the WSB Foundation. The WSB Foundation is a nonprofit organization, whose mission is to foster leadership to further social justice. The WSB Foundation also advances programs related to new lawyer development and diversity efforts, and to promote the administration of justice. In order to continue its programs, charitable contributions to the WSBF are welcomed and encouraged. More information about the Foundation is available at www.wsba.org/lawyers/wsbf.htm.
Next month we reconvene in Olympia for further legislative action, to meet with the Supreme Court and continue reviewing the Discipline Committee Task Force's recommendations.
I encourage you to contact me if you have any questions, comments or concerns about our Bar and Bar issues. Please feel free to e-mail me at
Patrickwsba@PalaceLaw.com.
Yours in Service,
Patrick A. Palace
Notes From the New Gov
Hats off to President-elect Sal Mungia! For the last three years, Sal has worked diligently to create the model which all other WSBA governors should follow. In the Sixth District, we have always been well represented by talented and hard-working governors. During his service as governor, we saw Sal Mungia's organizational skills, drive and energy, and he demonstrated exceptional abilities to govern. Under Sal's leadership, 1) the Tacoma Pierce County Bar News regularly printed "Notes From The Gov," 2) a newsletter was provided and distributed to the other counties of the Sixth District, and 3) a webpage at the WSBA website which contains his newsletter as well as past editions was created. Under Sal's leadership, it has been hard to be uninformed and uninvolved.
During the Board of Governors' meetings, Sal's leadership has been obvious. He is trusted and listened to by the other Governors. Despite a contested election with strong leadership credentials offered by the candidates, it was Sal who emerged as the winner of the election. This alone speaks volumes about the respect that he has earned from the Board and from Bar leaders across the state.
Having travelled to local bar meetings and state bar meetings with Sal, it is clear that he is well-liked and his work appreciated by all who have worked with him.
Sal leaves a huge pair of shoes to fill. It is with this first report that I attempt to slip my toes into the enormous Converse high-tops he left me.
We are lucky to have Sal as our president-elect. The combination of our new President Mark Johnson's charisma and leadership, and Sal Mungia's organizational skills and focus, may well make this Board the busiest group of governors the Bar has ever seen.
That having been said, the October 24, 2008, Board of Governors' meeting in Spokane was full and productive. Amongst the many agenda items, we considered the following:
Lawyers' Fund for Client Protection
As many of you know, the Lawyers' Fund for Client Protection Board (LFCP) oversees funds held to compensate victims who lost money through a lawyer's dishonest taking of, or failure to account for, the client's funds during representation. The LFCP is funded through a $15 annual assessment on all active WSBA lawyers.
Due to this year's applications, the LFCP paid out $150,000. However, as a result of a large body of additional applications outstanding and in need of payment, the fund will payout about $750,000 by the end of 2008, leaving the fund with $250,000 remaining. The annual report can be found at www.wsba.org/lawyersfundreport1008.pdf.
Discipline Review Committee
The Discipline Review Committee was asked to review 27 American Bar Association-recommended changes to Washington's Lawyer Disciplinary system. Based on the sheer size of the reviewing process, five task forces were created and the 27 recommendations divided among the task forces as part of this comprehensive review. The Board of Governors began review of the proposals in its October 24, 2008, meeting and will continue to review the proposals over the next five Board of Governors' meetings. Each meeting will designate significant time to the review of each task force's recommendations. More to come.
WSBA's Bylaws
The BOG is reviewing four recommendations by the Board's Bylaw Review Committee, all of which will affect license fees. The Board of Governors will be looking at the Bylaw Review Committee's recommendations regarding:
1. Simplifying the current license-fee structure by creating two tiers for active service rather than their currently existing five;
2. Simplifying the late-fee structure to reduce administrative costs;
3. Changing "emeritus" to "emeritus/pro-bono" status; and
4. Waiving the annual fee for "emeritus/pro-bono" members and requiring such members to perform at least 80 hours pro bono services annually.
The Committee's recommendations were reviewed by the Board of Governors. Future action will be taken to ratify or modify the Committee's recommendations.
WSBA Leadership Institute
The WSBA Leadership Institute's mission is to recruit, train and retain Washington attorneys for leadership positions in the legal community and in the WSBA. The Leadership Institute was created under the leadership of Ron Ward in 2004. At the Governors' meeting, the WLI presented two of their public-service projects:
1. The creation of a website designed to assist citizens seeking gubernatorial pardons (www.wapardonprocess.info); and
2. The creation of a project to educate the public, particularly youth and young adults, on the pitfalls of credit-card debt and predatory lending practices. This program was implemented through various high school classroom presentations and also incorporated into a CLE for lawyers. More information about the WLI can be found at www.wsba.org/lawyers/leadershipinstitute.htm.
Because the Board of Governors met in Spokane, we all had the pleasure of meeting members of the Spokane Bar and its judiciary. As I travel across the state and meet members of the local bars, it strikes me how united lawyers are, regardless of geography. Every local bar is proud of its activities, its service and its leaders. Spokane is no exception, and deservedly so.
December 5 and 6, 2008, we will cross to the other side of the state and meet in Bellingham.
I encourage you to contact me if you have any questions, comments, or concerns about our Bar and Bar issues. I look forward to representing all of you as your Governor for the Sixth District. Please feel free to e-mail me at Patrickwsba@PalaceLaw.com.
Yours in Service,
Patrick A. Palace
Patrick Palace is the governor for the Sixth Congressional District and is in practice with the law firms of Palace Law Offices and The Center for DUI Defense.
