Whole jungles and forests have perished in the production of articles, reports, commissions, and resolutions on the on-going debate on Multi-disciplinary Practices ('MDPs'), either urging action to facilitate or outlaw their existence. As with most things, progress lies somewhere in-between. Allow me to take a leaf out of your time.

The MDP movement started off fuelled by the expansionist practices of multinational accounting firms, who actually prefer now to be called professional services firms. It made sense having one firm handle an entire transaction, rather than hiring a number of separate professional firms, who would work together in an ad hoc team, but bill separately for their services. The then 'Big Five' (now 'Four') CPA firms moved aggressively to acquire law firms, or, failing that, developed close affiliations with law firms to expand the scope of their services beyond traditional accounting functions. In some countries, international accounting firms now provide legal services, including litigation services. From the client's point of view, one-stop shopping promises them the possibility of improved efficiency and quality through co-ordination, simplifying the process of service provider selection, and reducing the overall bill for services. Indeed, the proliferation of MDPs worldwide attests to the commercial appeal of the MDP paradigm.

The Council of the Law Society of Singapore began its debate on MDPs in September 1998. An ad hoc committee was formed to study whether Singapore law firms should be permitted to carry on business in the form of MDPs. In October 1999, a Report (put up to Council by the then Vice-President, Mr Goh Phai Cheng, SC) indicated that if lawyers were permitted to form MDPs, safeguards should be introduced in relation to the regulatory and ethical issues.

I touched on the topic of MDPs at the Opening of the Legal Year, last year. A month later, at a Dialogue Session, a vast majority of members favoured MDPs and opined that we should be looking into allowing 'Multi-disciplinary Group Practices' ('MDGPs'), and a July 2001 Report to Council recommended permitting or encouraging MDGPs.

About two months ago, Council placed its Interim Report of its MDP Committee (chaired by the industrious Mr George Tan), to the Attorney General, recommending MDPs in a limited form by setting up MDGPs, very much in the model currently used by group law practices, intended to be a first preliminary step in the direction towards fully integrated MDPs. Draft amendments to the Legal Profession Act (Cap 161) and draft Rules thereunder have been further proposed.

Worldwide, non-lawyers are venturing into areas of work that have been traditionally reserved for practising lawyers. Not only are non-lawyers doing legal work, but increasingly, lawyers doing that same work are employed in non-traditional organisations: consulting firms, trust departments, accounting firms and banks. Already, more than 50 internet-based legal services sites appealing to low-to-middle income consumers have been launched in the USA since last year, with many sites crossing borders and seen across our screens.

Lawyers have thus already come under assault. Changes in the global marketplace have already been seen in professional services, and these will dictate the outcome of the debate we have begun these several years. This worldwide emergence of MDPs is seeing entrenchment, and the legal profession would have to embrace the inevitable if we are to remain viable service providers in the future. Continuing to prevent lawyers from practising in an MDP structure effectively presents an obstacle to the evolution necessary for the profession to survive and provide increased services to the public. Denying lawyers the ability to deal with and participate in change will assure our long term irrelevance in the marketplace as, even if practising lawyers can be prevented from working in an MDP setting, it is not possible to prevent non-practising lawyers (corporate secretarial firms for example) from doing so. An anti-MDP stance will only assure that ethical rules apply only to lawyers who practise in traditional firm settings; the 'Enron' saga is just one example where everything went wrong.

One view taken is that we should wait until MDPs become accepted in several developed 'jurisdictions', before considering them within Singapore, although there should be no prohibition on MDP-like alliances formed between local law firms and foreign firms outside Singapore to provide off-shore legal work, or having alliances in relation to marketing promotion and introduction of overseas legal work. However, it may be felt that without a local model to draw upon, Singapore lawyers or law firms are unlikely to be the initiators or drivers of an MDP venture. There would also be difficulty convincing potential partners of the viability of such an MDP without any local track record to speak of, and our local firms may be placed at a comparative disadvantage against MDPs which are not similarly restricted in their home jurisdictions.

The MDP picture abroad has also been a somewhat mixed one to date, with theory being at odds with reality, with MDPs existing openly in some jurisdictions (Australia, in particular New South Wales, Europe, and some states in the US) or undercover in the rest of it.

Despite the clamour for MDPs, the American Bar Association ('ABA') continues to have reservations, with Autumn 2000 seeing the ABA House of Delegates voting, by a majority, against allowing MDPs, even in a situation where lawyers hold the majority shares. However, despite being the largest legal organisation in the world, with some 410,000 numbers, ABA has no direct regulatory authority. The US legal profession is governed by various authorities (state legislations, supreme courts, etc) in its federal states and the other jurisdictions comprising the United States and its territories, and it is these bodies that have the power to adopt and administer professional codes of ethics.

Until very recently, the codes of ethics in almost all these jurisdictions in the US prohibited the sharing of professional fees with non-lawyers, thus effectively prohibiting the combination of lawyers with other professionals in the same firm. Law firms could only raise capital through partner contributions, loans, and retained profits. To enable a solicitors' practice to attract outside investment will entail a rule change, and quite a number of jurisdictions in the US have undertaken the initiative, designed to modify or clarify the traditional rules governing lawyers in MDPs.

January last year saw the New York State Bar Association recommending the adoption of rules permitting lawyers to provide ancillary non-legal services and services in connection with non-legal entities, subject to provisos which contemplate permitting lawyers to enter into strategic alliances, and other contractual relationships with non-legal professional service providers, as well as permitting lawyers to own and operate non-legal businesses; but unless the services are clearly separated, legal ethics rules will apply to the attorney's provision of both. Additional regulations require lawyers to remain in complete control of the rendering of legal services, thereby satisfying the purported demand for legal services without sacrificing the independence of the bar.

In the United Kingdom, as early as 1986, the Director-General of Fair Trading held the view that it was desirable in principle to permit MDPs, and specifically advocated the removal of any statutory prohibition to fee sharing. Although the Solicitors Act 1974 was amended and statutory barriers were removed, there was no legal or regulatory material to bring about the existence of MDPs. The prohibition against fee sharing was then seen as a major obstacle. Since then, at diverse times (the last being 7 December 2000), some four working parties were set up by the Council of the Law Society of England and Wales to consider the issues surrounding MDPs.

The Third Working Party Report presented the regulatory scheme to deliver 'Legal Practice Plus', an interim solution before the introduction of a pure form of MDPs, where non-solicitors could become partners in a law firm, so long as the business remains one involving the provision of legal and ancillary services, and, non-solicitors agree, by contract, to submit to the Society's regulatory powers and observe the rules of conduct. The solicitor partners would then be required to supervise the non-solicitor partners, and ultimate control would remain with solicitors, who would form a numerical majority (except in the case of two partners). In March 2001, it was decided that legislative changes were required to implement Legal Practice Plus. The Law Society of England and Wales felt that it would be possible to remove the rule against fee sharing and that the evils which the rule was traditionally held to prevent (lack of independence of the solicitor, conflict of duties to client, etc), would be satisfactorily presented by the safeguards contained in the core duties, and thus proposed new rules.

Elsewhere in Europe, integrated MDPs are allowed in Germany among lawyers, accountants, tax advisors, tax representatives and notaries. However, in the Netherlands, the European Court of Justice handed down a judgment in February 2002 that said that a proposed integration between a Dutch legal firm and local affiliations of two of the largest accounting firms in the world was not possible as there may be some incompatibility between the 'advising' activities carried out by a lawyer and the 'supervisory' activities carried out by an accountant.

Down under, MDPs have been in existence in New South Wales, Australia, since about 1994. Western Australia is also going ahead with MDPs, with other Australian states trying to follow suit. The Law Council of Australia supports the formation of MDPs, and in a Paper in December 2001, had as its focus, regulating the compliance of individual lawyers with their ethical duties rather than the regulation of their choice of business structures.

Up north, the Canadian approach has been somewhat similar, with the Canadian Bar Committee recommending in August 1999 that a policy on MDPs should focus on the regulations of lawyers in MDPs, and not on the MDPs themselves. MDPs are currently permitted in Ontario and Quebec in a limited way. The general consensus is in favour of the same.

In short, a similarity of views has emerged, and is converging. Most agree that the future of the legal profession will be dictated and driven by the needs of the client, and as a profession dedicated to serving the clients' needs first and foremost, that it is incumbent upon the profession to not only accept these changes as stark reality, but to embrace them. Whether it be lawyer-controlled MDPs or fully integrated MDPs, the market forces will prevail. Principles that govern the conduct of lawyers, therefore, ought not be used to prevent change unless necessary to protect the public, and should instead be used to enable change to occur naturally and within defined parameters. If these principles are to withstand the test of time, they must be universal in application and flexible enough to be inclusive rather than exclusive.

With the apparent determination of the 'Big Four' and other professional service firms to offer legal services, it is clear that the market will determine the outcome, more so with increasing technology, globalisation and a call for transparency in everything that we do. However, MDPs are not only for the large firms but provide an opportunity for smaller and mid-sized firms to make strategic alliances that might in the future turn into full MDPs. Whether it be corporate clients or an individual, having the ability to pick and choose the right professional service provider for the specific needs will be the order of the day. Regulations must catch up with the practice.

By 2010, the capacity of chips in our computers will have multiplied a hundred-fold. Clients will be likely to deal with lawyers and doctors as well as tax advisors in an integrated service - an example is a one-stop shop offering estate agency, mortgage, conveyancing and insurance. The focus must be on the end result, with selling successful outcomes as the key.

The profession, as I knew it just a quarter of a century ago, is dying, and those assembled at its bedside - or most of them - still disagree about the seriousness of the illness, and whether anything should be done to save the patient. If you are, and you must be, a global player - as Singapore is now with FTAs at our crossroads - mergers in the first degree with other professional or non-professional firms will see us taking many steps away from medieval guilds which were built on selfish, anti-competitive restrictions on entry, the conduct, and the pricing of work.

There has been much dragging of feet over what seems to be a capital idea, and if the lawyer is not to see his demise, this may prove his salvation: let us see a merger, not murder or suicide. Technology from Hell, as one author puts it, has already challenged lawyers. With MDPs, we cannot remain ensconced in a hulking monopoly with our feet in the Middle Ages. An open-market approach is needed in this technology-enabled globalised village. Let there be more than a merger of minds and ideas, as we face tomorrow's world.

Palakrishnan, SC
President
Law Society of Singapore