Heads in the sandbox

Regulatory sandboxes are sprouting everywhere. We can smile at human eagerness to follow a trend. But we should realise that, among other things, they represent an effort to solve the access to justice crisis.  We have tied ourselves pretty firmly to a legal aid solution. But the question arises whether other solutions may lead more quickly and efficiently to our goal.

A sandbox is a controlled environment in which innovations, maybe illegal or unethical under current regulations, can be piloted and evaluated. Two sandboxes in different jurisdictions were announced last week. 

In our jurisdiction, it was reported that a private consulting firm will draw up a LawTech sandbox, developed with government money, with the aim of accelerating the development of new and advanced methods of legal services delivery. 

This is similar to the SRA’s existing sandbox launched in 2018, called an ‘Innovation Space’.  

At the same time in the US, another was launched which may set the template for much more change in the US. The Utah Supreme Court, responsible for lawyer regulation in the state, voted unanimously to establish an Office of Legal Services Innovation, with responsibility for licensing and overseeing new forms of legal providers and services.

The Utah initiative is based specifically on legal needs arising out of its access to justice crisis, aggravated by the Covid-19 pandemic. The background statements make clear that pro bono can no longer stretch to contain unmet need, and that other solutions are needed, particularly in the light of the growth of unregulated lawtech, which is already providing solutions.

The new Office of Legal Services Innovation will be guided by regulatory objectives quite different from those we are used to. Instead of the classical format of education, ethics and discipline, regulation will rather be based on the evaluation of risk to the consumer, which should itself be evaluated relative to the current legal services options available. There should be probabilistic thresholds for acceptable levels of harm, and the regulation should be empirically driven and guided by a market-based approach.

None of this should be surprising. We have known it was coming for ages. There is, in England and Wales, an unmet legal needs crisis, also exacerbated by the pandemic and the consequent economic downturn. The LSB says it is going to look at the reserved activities, because it knows that the government will not allocate parliamentary resources for major changes to the Legal Services Act 2007. The recent Mayson report called for the unregulated to be regulated in the short-term. In other words, warning lights are going off all over the professional landscape that change is needed to deal with public need.

Our profession’s response to date has been to call for increases in legal aid. It is true that substantial increases in legal aid would be an excellent solution for citizens needing to deal with legal problems, and for lawyers providing services to them. We can all agree on it, and we can all shout loudly and genuinely: INCREASE LEGAL AID, BOTH CIVIL AND CRIMINAL!

The question we have to ask ourselves is whether the kind of increase which is needed properly to tackle our access to justice crisis is realistically going to be granted. The history from the last 10 years is that it is not. We have been unsuccessful in our campaigns. Saying that is neither to criticise those who have worked so hard to overturn government spending practices, nor to wish to undermine ongoing and future efforts for increases.

Put differently, the landscape shows a number of lights flashing as regulatory sandboxes are being established to accommodate the currently unregulated (including with government money), while we are unsuccessfully yelling at the government for more legal aid money. What are we to do? Carry on yelling at the government or begin to think seriously about what kind of regulatory changes we would welcome – or maybe just tolerate - emerging from the various sandboxes springing up? Of course, the two can be undertaken simultaneously (if we have the resources), and maybe that is what we should do – but I would counsel putting our serious money in the sandbox route.

Change is coming, and it is better to surf and control it, than to wish for a past that is not going to be resurrected. The unregulated lawtech companies have increasing ability and resources, and want (mostly) to be regulated. Regulators are setting up environments in which they can provide legal services lawfully and flourish.

Therefore, we should be looking at new models which can work, which provide the nearest equivalent in protections to clients to those currently available through solicitors, and which mesh with our legal professions and legal system. We should be giving a lot of thought to what we would like see emerge from the sandboxes.

Jonathan Goldsmith is Law Society Council member for EU matters and a former secretary general of the Council of Bars and Law Societies of Europe. All views expressed are personal and are not made in his capacity as a Law Society Council member nor on behalf of the Law Society