2017 Fundamentals of Law Webinar-Young Lawyers Division Increase Profitability and Efficiency of your Firm Through Paralegal Utilization Tracy Gompf, JD-Paralegal Program Coordinator and Professor Minnesota State University Moorhead 2017 Fundamentals of Law Webinar-Young Lawyers Division

What is a Paralegal? Paraprofessional for the legal profession Wide range of definitions Definition has changed in last 20 years Lawyers use two terms to define support staff: Legal Assistant Paralegal

What is the Difference? Legal Assistants primarily perform clerical tasks as delegated by the lawyer The tasks performed usually can’t be billed to the client Paralegals primarily perform substantive legal tasks that would be performed by the lawyer without a paralegal The tasks are usually billed to the client at the paralegal rate

Substantive Legal Tasks Direct contact with clients Drafting legal documents for review Organizing legal files and information Interviewing witnesses Preparing discovery documents for review Legal research and legal writing Preparing briefs and memoranda for review Many more!

Delegation of Tasks Lawyer can delegate tasks to a paralegal N.D.R.P.C. Rule 5.3(d)(1): A lawyer may delegate to a legal assistant any task normally performed by the lawyer except those tasks proscribed to one not licensed as a lawyer by statute, court rule, administrative rule or regulation, controlling authority, or the rules of professional conduct Rule 5.3(d)2-Paralegals can’t establish client-lawyer relationship, establish fees, give legal advice, sign pleadings, or appear on behalf of client

Supervision Paralegal tasks are performed under the direct supervision of a lawyer unless an exception applies N.D.R.P.C. 5.3 provides that a lawyer must make reasonable efforts to ensure that the nonlawyer’s conduct is compatible with the professional obligations of the lawyer Paralegals are expected to be familiar with rules of professional conduct that apply to lawyers

Unauthorized Practice of Law N.D.R.P.C. 5.5: A Lawyer can’t permit a paralegal to engage in the unauthorized practice of law Supervisory obligation includes ensuring that the work assigned to a paralegal is not UPL Lawyer must provide sufficient supervision to ensure that the paralegal is not engaging in UPL outside of the tasks assigned

Disclosure of Paralegal Status Paralegal must disclose status in communications with clients and third parties Paralegal can have business cards and be listed on lawyers’ signage and stationery with a disclosure of status N.D.R.P.C. Rule 7.5 Paralegal must not engage in the unauthorized practice of law

Billing for Paralegal Tasks N.D.R.C.P. 1.5: a lawyer may charge for the work performed by a legal assistant Prohibits any form of fee splitting between the lawyer and the paralegal Compensation of the paralegal cannot be contingent on the outcome of a case or the profitability of the lawyer’s practice

Effective Use of Paralegals Myths-i.e. Paralegals will “take” work from associates Large percentage of tasks in the legal setting can be effectively performed by paralegals Frees the lawyer for tasks that can only be performed by the lawyer Serves clients more effectively with quality of contact and reduced costs Lawyers can serve more clients and increase professional success

Examples of Paralegal Tasks Conduct factual investigation-interview clients and witnesses for background info and general communication Conduct legal research and draft pleadings, correspondence and other documents Maintain calendaring system Index or summarize transcripts Assemble, analyze and draft discovery Client Contact-keep clients updated on case status Trial Preparation and Support Important!-Review, Implement and Maintain Technology Result: Lawyer can handle more cases more efficiently

Analyzing the Profitability of Paralegal Work

Hourly All Work by Lawyer at $250 Per Hour Task Hours Cost Client Interviews 4 $ 1,000 Witness Interviews 6 $1,500 Responding to Written Discovery 12 $3,000 Preparing for and Taking Depositions 12 $3,000 Legal Research 10 $2,500 Preparation of Pleadings 12 $3,000 Trial Preparation 16 $4,000 Trial 16 $4,000 Total 88 $22,000

Hourly with team - Paralegal at $100 Per Hour Task Timekeeper Hours Cost Client Interviews: Lawyer 4 $1000 Paralegal 4 $ 400 Witness Interviews: Lawyer 2 $ 500 Paralegal 6 $ 600 Responding to Discovery: Lawyer 2 $ 500 Paralegal 14 $1,400 Prep. for and Taking Depos.: Lawyer 6 $1,500 Paralegal 7 $ 700

Hourly with team - Paralegal at $100 Per Hour (Cont’d) Task Timekeeper Hours Cost Legal Research: Lawyer 2 $ 500 Paralegal 12 $1,200 Preparation of Lawyer 2 $ 500 Pleadings: Paralegal 14 $1,400 Trial Preparation: Lawyer 8 $2000 Paralegal 16 $1,600 Trial: Lawyer 16 $4,000 Paralegal 16 $1,600 Total: 131 $19,400

Improved Client Satisfaction and Retention Reducing Legal Fees

Reducing Legal Fees: Cost to Client Scenario 1 Lawyer Works 88 Hours Scenario 2 Lawyer Works 42 Hours Paralegal Works 89 Hoursrs Costs to Client $22,000 Costs to Client $19,400 Client Saves $2,600, or 12%

Reducing Legal Fees: Cost to Firm Scenario 1 Lawyer Works 88 Hours at $182/hr. (Cost to Firm) Total Cost to Firm = $16,016 Scenario 2 Lawyer Works 42 Hours at $182/hr.(Cost to Firm) Paralegal Works 89 Hours at $67/hr.(Cost to Firm) Total Cost to Firm = $13,607 Firm Saves $2,409 or 15%

Thank You For More Information Contact Tracy Gompf, JD Paralegal Program Coordinator and Professor Minnesota State University Moorhead 1104 7th Ave. South, Dept. of Economics, Law and Politics, MacLean Hall, Moorhead, MN 56563 gompftr@mnstate.edu For more information refer to the attached Bibliography for source material

Bibliography-Sources James Wilber, “First Thing We Do, Let’s Reduce the Number of Lawyers”, http://paralegals.uslegal.com/articles/reduce-the-number-of-lawyers/ Dorthe J. Howell, “Paralegal Utilization: Improving Efficiency and Profitability”, Maryland Bar Bulletin, January 2007 MSBA Paralegal Committee:  Improve your Bottom Line & Increase Your Practice through Proper Utilization of Paralegals, revised 2012 ABA definition of Legal Assistant/Paralegal adopted by the ABA House of Delegates in August 1997, www.americanbar.org. Jeffrey D. Campbell, “The Economic Benefits of Paralegal Utilization”, Copyright 2005 American Bar Association. For further information on Paralegal Utilization: http://www.americanbar.org/groups/paralegals.html