The problem of declining legal aid for the poor is well known. But what about the predicament of the near-poor, who can no longer afford a lawyer, and had no legal aid to begin with? Enter the DC Affordable Law Firm (DCALF) launched in 2016 with the unique aim of reaching America’s desperate second income quintile, by charging fees that top out at $75 rather than $1,800 per hour.
‘Our profession has utterly failed to deal with the problem of those with a little means but not enough,’ says Sheldon Krantz, who co-founded the DCALF after writing an impassioned call to reform entitled, The Legal Profession: What is Wrong and How to Fix It.
‘We focus on a population that has nowhere to go,’ because ‘there’s virtually no commitment to “low bono” anywhere in the world,’ he says.
A battered wife with three teenage children, ‘Dolores’ earned between two and four times the poverty level as a junior government employee. ‘She fell right in that range where she didn't qualify for legal services, but she couldn’t possibly afford a lawyer,’ recalls DLA Piper associate Richard Kelley, who took her case while he was a DCALF fellow. Beaten for two decades, Dolores ended up in the hospital several times. Once her husband ‘put her head through the wall’, Kelley says. Thanks to the DC Affordable Law Firm, Dolores won an extended civil protection order and full custody of her children.
“Our profession has utterly failed to deal with the problem of those with a little means but not enough
Founder, DC Affordable Law Firm
Without DCALF, Dolores would have either stayed in an abusive marriage or given up the fight for her legal rights, Kelley believes. ‘If she went to court she would’ve had to face her abuser alone. But my guess is she wouldn’t have gotten that far. Particularly for someone who has been controlled for so long, it’s really difficult to exert control in an environment you don't know how to navigate.’
Nine out of ten times, Krantz says, a client like Dolores will represent herself pro se. Matched up against a professional in a hopelessly complex system, a member of the working poor who faces eviction, divorce or deportation will usually lose their home, their children or their precarious place in US society. And with a seventeen-factor legal test, litigating a child custody case is no less challenging than advising on corporate compliance, Kelley says. Only the stakes are higher.
Among DCALF’s goals, Krantz says, are to attract excellent new lawyers like Kelley, and train them to rescue needy clients like Dolores. The founding sponsors were the law firms DLA and Arent Fox, which provide training and supervision; as well as Georgetown Law School, which underwrites six fifteen-month fellowships (with additional support from the Spitzer Foundation), at a current annual salary of $50,000. Arent Fox also contributes free office space. DCALF recently announced that Venable has joined as a law firm sponsor, and a fourth major law firm is expected to join soon.
Two-and-a-half years after opening the DC Affordable Law Firm, Krantz considers many of its goals achieved. ‘Can we attract excellent young law school graduates with modest salaries?’ he asks. ‘Yes. Is it possible to train those lawyers to represent these clients effectively? Yes. Are we serving an unmet need? Yes.’
What remains to be shown is that the model can support itself financially. In its first two years of operation, legal fees generated less than a third of revenues. Although the firm operated at a loss in 2016, Krantz says that the firm operated at a surplus in 2017, and is on track to do so again in 2018.
An initial study found a billing realisation rate of only 45 per cent, and a collection rate of only 66 per cent, in part because the firm waives fees for its poorest clients, but Krantz says these rates are improving.
The Georgetown Justice Lab concluded in a report on the venture’s first full year that ‘the goals of providing affordable high quality legal services and preparing lawyers for practice took precedence over generating revenue.’ Asked to respond to this critique, Krantz wrote: ‘We continue to give priority to providing affordable high qualify legal services to the population we serve and extensive litigation experience to DCALF lawyers while they are with us. That being said, we remain committed to finding ways to make DCALF sustainable. We are grateful, therefore, that our three sponsoring partners have executed a new Memorandum of Understanding giving us an additional three years to find ways to become sustainable. We are optimistic that we will be able to achieve this goal through a combination of law firm revenue, grants and charitable contributions.’
In particular, Krantz identified growth as the path to sustainability. Tapping new law firms, starting with Venable and its soon-to-be-named fourth sponsor, is an important step forward. So is accepting third party payments from entities like the Service Employees International Union, which has recently begun to pay for its members’ legal needs, and to refer members to the Affordable Law Firm. In the future, Krantz says, affordable law firms might serve as one platform for the wave of baby boomer lawyers who will be retiring, and will seek ways of using their skills to continue contributing to society.
In its first two to three years, the Affordable Law Firm has proved that it fills a huge need well. In the next two to three years, it needs to show that the near poor can pay enough legal bills to keep the doors open. ‘If we’re going to be replicated, we need to show that it’s sustainable,’ he says. ‘That’s a core motive.’ Leaders of the profession from Australia to California are watching the experiment intently.