October 30, 2014

by Dafyd Martindale

Once upon a time, Australian law firms were barred from all but the most minimal forms of advertising.

And this ban did no apparent harm. Lots of lawyers were gainfully employed, universities kept on pumping out new crops of young lawyers each year and the court system functioned pretty well. Australia was a happy-go-lucky place.

It was true that consumers looking for a solicitor might find it difficult to quickly locate one who specialised in the area they needed help in.

But as is the case with GPs today, a quick chat with a local solicitor, a few phone calls and a referral or two soon sorted things out.

The ban on legal advertising began to be relaxed in the 1990s.

The reasoning at the time was that information provided in legal advertisements would assist consumers make the most appropriate purchasing decision when they needed legal services.

Two decades later we live in a world where lawyers routinely broadcast their sales messages online, on TV, on radio and in print.

While some restrictions on legal advertising remain, Australian lawyers now live in a far different world than they did in the 1990s.

But so do the rest of us, and it’s not a good place.

Was relaxing the former bans on legal advertising really such a good idea? We don’t think so …

The reason? The rise of litigation culture over the past two decades.

Back when we were children, if you went to play in the local park, fell off a swing and skinned your knee, you took it as Nature’s way of reminding you to take more care. Then you dried your tears, put a Band-Aid on your wound and got on with life.

Or if you were walking down the footpath, caught the heel of your shoe in pavement crack and fell over; or bought a coffee and spilled it in your lap, you took it as Nature’s way of telling you to pay more attention.

But for some people these days, an incident like this is just an excuse to file a lawsuit.

Two decades of advertisements by law firms have led at least some people to believe that when life deals you a blow it’s someone else’s fault – not your own – and someone, somewhere should pay for it.

It’s also fuelled the unrealistic view that life should be super-safe and risk-free, which is completely opposite to the way it actually is.

This encouragement to litigate isn’t just confined to making you think you’re a victim when you’re really just a clumsy idiot.

Lawyers now offer positive inducements to file claims.

Perhaps you’re a bit short of money at the moment? No problem! Somewhere you’ll find a friendly legal firm who will take up your case on a “No Win No Fee” basis (just make sure you read the fine print).

Or perhaps you feel you’re part of an aggrieved community? Then join a class action and split what’s left of any settlement with your fellow complainants after the lawyers have taken out their hefty cut.

Now, we do not dispute that there are many genuine cases where people have been wronged and are justly entitled to fair compensation. Nor do we begrudge the right of legal professionals to make a decent living.

But it’s easy to see that some of the developments in community attitudes towards the law are not helpful.

They’re unhealthy because they have damaged respect for the legal profession. And they’re even more unhealthy for the society we all live in.

The rise of a litigation culture – particularly “speculative” litigation where law firms bankroll suits themselves – has led to steep cost hikes right across Australian society.

Insurance premiums have risen sharply in many areas. Workers Compensation costs dwarf what they once were and all manner of people are now employed trying to proactively limit the opportunity for lawyers to file suit.

The costs of all these things, sooner or later, hits the hip pockets of all Australians.

And far from being the free and happy place it once was, Australia is now a country where fear of a lawsuit – any lawsuit – warps everyday life and behaviour.

The bottom line is that solicitors are in business. It is in the direct interest of the legal profession to encourage as much litigation as possible.

But it’s this aim that damages the interests of the overwhelming majority of ordinary Australians who wind up paying for it.

The time for a review hasn’t just arrived; it’s overdue.