Posted by: sadanandnaik | October 31, 2011

Chapter 7 Individual filing may go up after 11/1/11

Means test is the method used to determine the filing of bankruptcy under chapter 7. This will also determine the chapter 13 plan period and payments.

Section 707(b)(2) of the Bankruptcy Code applies a “means test” to determine whether an individual debtor’s chapter 7 filing is presumed to be an abuse of the Bankruptcy Code requiring dismissal or conversion of the case (generally to chapter 13).

If the debtor’s current monthly income is below the state median income, debtor is not required to complete the means test.

According to the new median income published by the Census Bureau USDOJ: U.S. Trustee Program website, the median income for Individuals has increased in 32 States (see the figures highlighted in green). These New Means Test Numbers are applicable to means testing calculations from November 1, 2011.

As the median income in many states have increased, individual debtors who were not able to file the bankruptcy under chapter 7 earlier may be qualified to file the chapter 7 with the new means testing numbers.

This may lead to the more filing of bankruptcy under chapter 7. However, chapter 7 in the other states may decrease as the median income numbers have decreased.

State Median Income Comparison Table

 

State

1 earner

1 earner

2 People

2 People

3 People

3 People

4 People

4 People *

Till 31st

After 11/1/11

Till 31st

After 11/1/11

Till 31st

After 11/1/11

Till 31st

After 11/1/11

Alabama

$38,642

$38,321

$46,900

$46,025

$52,460

$51,182

$64,016

$61,593

Alaska

$51,950

$52,611

$75,460

$70,811

$81,447

$77,200

$85,964

$88,003

Arizona

$42,603

$41,385

$55,404

$53,781

$59,659

$56,508

$67,113

$61,267

Arkansas

$32,834

$34,203

$44,081

$44,048

$49,599

$47,035

$54,401

$56,275

California

$48,009

$47,683

$62,970

$61,539

$68,670

$66,050

$78,869

$74,806

Colorado

$48,598

$47,361

$64,679

$62,431

$70,861

$69,252

$83,976

$79,905

Connecticut

$57,863

$56,773

$71,961

$70,342

$83,655

$80,263

$103,314

$99,440

Delaware

$48,415

$48,049

$62,432

$59,927

$68,518

$71,259

$85,305

$79,829

District of Columbia

$48,822

$50,552

$80,172

$78,313

$80,172

$78,313

$80,172

$115,995

Florida

$40,029

$40,766

$50,130

$49,729

$54,594

$52,840

$65,135

$62,742

Georgia

$39,384

$39,694

$52,024

$50,712

$56,682

$55,711

$69,239

$64,223

Hawaii

$50,664

$51,099

$64,179

$62,432

$75,670

$75,900

$86,587

$82,726

Idaho

$39,050

$39,120

$48,648

$49,242

$55,453

$52,077

$61,480

$61,301

Illinois

$46,355

$45,545

$60,073

$57,964

$69,910

$66,758

$81,097

$79,074

Indiana

$40,135

$39,987

$51,104

$49,669

$59,028

$57,696

$69,226

$67,296

Iowa

$40,456

$40,650

$56,036

$55,217

$63,510

$62,251

$75,569

$72,234

Kansas

$41,654

$41,611

$57,174

$55,801

$64,863

$62,850

$69,272

$72,665

Kentucky

$37,606

$38,356

$45,081

$44,696

$51,883

$51,859

$63,768

$62,583

Louisiana

$38,108

$37,931

$46,704

$46,169

$55,699

$54,638

$67,239

$65,778

Maine

$39,497

$40,532

$51,600

$51,738

$59,050

$60,195

$68,466

$74,738

Maryland

$55,774

$57,455

$74,493

$73,947

$87,152

$84,151

$103,361

$100,928

Massachusetts

$55,049

$53,496

$68,243

$64,174

$83,736

$80,337

$102,110

$99,067

Michigan

$42,562

$43,677

$50,738

$50,079

$60,161

$58,467

$71,758

$70,237

Minnesota

$45,760

$46,161

$61,690

$61,170

$74,082

$71,784

$85,146

$84,251

Mississippi

$32,658

$33,126

$41,579

$41,601

$47,058

$45,536

$55,711

$54,765

Missouri

$39,332

$38,895

$51,120

$50,603

$58,610

$58,355

$69,832

$67,255

Montana

$38,577

$38,369

$52,412

$49,743

$56,265

$56,308

$67,921

$68,313

Nebraska

$38,915

$39,192

$54,124

$55,519

$65,486

$64,700

$71,097

$71,247

Nevada

$43,041

$43,146

$57,541

$55,573

$60,783

$60,855

$70,509

$65,179

New Hampshire

$51,460

$51,550

$63,534

$61,679

$82,465

$79,349

$89,990

$91,750

New Jersey

$59,060

$60,322

$70,680

$67,503

$85,573

$84,896

$101,106

$101,957

New Mexico

$37,274

$37,246

$51,855

$49,515

$52,303

$51,782

$53,709

$54,640

New York

$46,295

$45,931

$57,777

$56,113

$68,396

$66,953

$83,942

$81,212

North Carolina

$37,781

$37,892

$50,630

$48,710

$55,468

$54,310

$67,578

$65,036

North Dakota

$41,443

$42,953

$56,411

$58,742

$69,328

$67,244

$79,637

$79,336

Ohio

$40,749

$40,471

$51,319

$50,253

$60,247

$58,376

$72,625

$70,599

Oklahoma

$36,884

$37,466

$49,711

$48,313

$54,135

$53,332

$64,037

$60,395

Oregon

$44,707

$42,877

$55,553

$52,316

$60,523

$57,429

$72,767

$66,616

Pennsylvania

$44,897

$45,092

$53,706

$53,091

$67,113

$66,487

$79,916

$76,682

Rhode Island

$46,136

$46,335

$58,511

$59,624

$72,184

$66,800

$88,593

$86,267

South Carolina

$37,055

$37,660

$50,500

$47,853

$52,738

$50,824

$63,074

$62,912

South Dakota

$35,582

$36,799

$53,443

$55,026

$58,794

$61,612

$68,016

$69,006

Tennessee

$38,144

$37,967

$47,194

$47,234

$53,227

$51,642

$63,217

$60,909

Texas

$38,294

$39,673

$55,178

$53,950

$56,445

$57,825

$65,477

$63,859

Utah

$50,635

$48,176

$56,126

$55,555

$61,944

$59,626

$69,834

$64,780

Vermont

$43,042

$43,544

$57,948

$55,110

$65,829

$69,736

$78,392

$77,296

Virginia

$50,296

$50,605

$63,613

$64,288

$73,260

$71,644

$86,990

$87,498

Washington

$49,930

$51,671

$63,224

$61,919

$72,524

$69,195

$82,602

$80,404

West Virginia

$39,750

$40,887

$42,607

$44,018

$51,350

$50,987

$60,280

$61,691

Wisconsin

$41,150

$41,880

$56,080

$55,671

$66,256

$64,724

$77,438

$76,117

Wyoming

$46,172

$48,832

$60,829

$62,072

$69,677

$67,059

$76,361

$73,362

* Add $7,500 for each individual in excess of 4.

Commonwealth or U.S.Territory

1 earner

Family Size

2 People

3 People

4 People *

Guam

$36,480

$36,480

$43,617

$43,617

$49,704

$49,704

$60,149

$60,149

Northern Mariana Islands

$24,496

$24,496

$24,496

$24,496

$28,500

$28,500

$41,918

$41,918

Puerto Rico

$21,273

$21,190

$21,273

$21,190

$23,011

$21,479

$28,382

$27,838

Virgin Islands

$28,943

$28,943

$34,786

$34,786

$37,090

$37,090

$40,636

$40,636

* Add $7,500 for each individual in excess of 4.
Posted by: sadanandnaik | October 30, 2011

Not filing bankruptcy does more harm than the good.

Bankruptcy is the special kind of civil suit involving people and organizations. Bankruptcy represents the status of bankrupt of debtor or the corporation. History of the Bankruptcy dates back to the medieval Italy, when the merchants used to borrow money from the Creditors and set up the business on bench or table to provide the service or sale of goods.  When the merchants were unable to pay the debt, it was a common practice for creditors to break the trading table/bench of the Merchant to signify their business failure. Often creditors used to break the table or bench over their head.

Over the period of many centuries, the concept of Bankruptcy has changed a lot. The first bankruptcy law was passed by the Parliament of England in 1542.

Article 1, Section 8 of the US Constitution gives Congress the exclusive power to establish uniform laws on the subject of bankruptcies throughout the United States. Congress enacted the first bankruptcy law in 1800 to allow the involuntary bankruptcy of traders. Later congress passed and repealed the bankruptcy law many time throughout the two centuries. New bankruptcy law in 1841 allowed for voluntary and involuntary filing of bankruptcy. Finally, the Bankruptcy Reform Act was passed in 1978.  BAPCPA made major changes to the bankruptcy act in 2005.

Till recently, Private Student Loan Bankruptcy Fairness Act of 2011 is reintroduced in the parliament (H.R. 2028) and expects to modify the dischargeability of debts for certain educational payments and loans.

Filing of bankruptcy is one of the peaceful and the best options to start with the fresh financial start. It will also provide for reorganisation of debts than any other systems can do.

People have lot of misconceptions about filing of Bankruptcy. Filing and not filing bankruptcy good or bad depends on the each client case and circumstances.

If we study about the statistics on the Bankruptcy filing, it shows that not filing bankruptcy does more harm than the good. More than 10 million people have filed for bankruptcy over the decade. 96% of the cases filed under the chapter 7 were “No asset cases”.

If the filing of Bankruptcy was doing more harm than the good, these numbers of people would never have filed for Bankruptcy.

When we analyse the filing and not filing of bankruptcy we can summarize the client situation as below:

Debtor Assets:

 

Debtor house:

 

If debtor does not file: If the debtor defaults on the mortgage loans and does not make any payments. The creditors can sell the house either through judicial and non judicial foreclosure sale. Debtor is liable for any difference amount arisen out of foreclosure sale and the creditors also can file for recovery of the difference amount by filing the law suit.

If debtor files:

Chapter 7: Under chapter 7, various state exemptions allows debtor to keep the house by paying equity in the property. E.g. If the mortgage on the house is $400,000 dollar and current market value of the property is $450,000, a debtor can keep the property by exempting the $50,000 equity in the property. Most of the states in the US provides for homestead exemption on the debtors residence. Homestead Exemptions vary widely from state to state. For example, the exemption is $21,625 in Ohio, $100,000 in North Dakota, and $550,000 in Nevada.  $150,000 in Arizona, $70,200 in Alaska, $5,000 in Alabama, $100,000 in Delaware, $100,000 in Idaho.

Chapter 13: Allows the debtor to keep the property by making payments over the 3 to 5 years. Most of the mortgage payment on the house is paid outside the plan.

Moreover the debtor can strip off the judicial or secondary mortgages which impair the exemption. For example: In the above example if the debtor has judicial lien on the property which is $50,000 and the law provide for $50,000 exemption, debtor can avoid the lien since it impair the available exemptions.

Debtor’s Car:

 

If the debtor does not file: If the debtor default on car loan payment, the car will be repossessed. Creditors will also sue for any difference amount. Debtor will lose the car and still owe the debt on the car on auction sale difference amount.

If debtor files:

Chapter 7:

Options: 1. Debtor can keep the car by claiming any exemptions. Motor vehicle exemptions vary from state to state. $1,000 to $15,000. Some states do not have Motor vehicle exemptions but can be claimed by using the wild card exemption.

2. If any loan on the car and the car is required for primary means of transport, debtor can redeem the car by paying current market value of the property. (722 redemption)

3. If the loan on the car is upside down, if the debtor do not want to redeem the car, debtor can give up. Creditors cannot sue for the debt/car loan which is discharged in the Bankruptcy.

Chapter 13: Debtor can pay the car loan payment over the 3 to 5 years.

If the loan on the car is 910 days old, debtor can get the car loan modified to current value of the property. Debtor can also reduce the car loan interest as per the decision in Till Vs.SCS Credit Corp (also called as “till rate”)

Cash on hand: Most of the state and federal exemptions allows the debtor to keep the certain amount as exempt from the bankruptcy estate.

Checking and saving account: Most of the state and federal exemptions allow the debtor to keep the certain amount as exempt from the bankruptcy estate.

Household goods and furnishings: Most of the state and federal exemptions allow the debtor to keep the certain amount of Household Goods and furnishings as exempt from the bankruptcy estate

Jewelry: Most of the state and federal exemptions allows the debtor to keep the certain amount Jewelry as exempt from the bankruptcy estate.

Debtor’s wage: If the debtor is default on the payment, creditors can bring an order to garnish the wages. Bankruptcy stops all type of garnishment on the wages. If the wage is already garnished and the amount transferred is above $600 prior to 90 days of filing bankruptcy, debtor may be eligible to recover this based on the preferential payment.

Debtor Debts:

 

Medical Bills:

If the debtor does not file: Creditors will initiate the law suit against the debtor. They can also create the judgement lien on the debtor property. Lien will remain on the property as long as the debtor pay off the debt.

If debtor files:

Chapter 7: Debtor will get discharge from the medical bills. Debtor is no longer obligated to pay the debt.

Chapter 13: The amount the creditors receive varies from 0% to 100%.

Student loans:

 

If the debtor does not file: Creditor or the agency can Garnish wages upto 15% of debtor’s disposable income to payback the student loan.

If debtor files:

Chapter 7: If the debtor is facing a real hardship in paying the student loans, court can consider the discharge. Many of the bankruptcy court use the Brunner Test to determine the dischargeability of student loans.

Chapter 13: Debtor can propose a plan to pay the student loan, any remainder of the student loan has to be paid after the plan.

Taxes:

If the debtor does not file: If debtor default on the tax payment to government, government can create a tax lien on the debtor property.

Chapter 7: Debtor can discharge the 3 year old taxes if it meets certain requirement.

Chapter 13: Debtor can pay off the debt over the period of 3 to five years and receive the discharge.

Utility bills:

 

If the debtor does not file: Utility service provider will cancel the utility services and sue for the balance amount.

Chapter 7: Debtor’s utility bills can be discharged under chapter 7. However, if debtor wants to continue with the utility services, debtor needs to deposit two months average utility bills.

Chapter 13: Debtor can propose a plan to pay off the arrears on utility bills under chapter 13 plan.

Credit Card Debts:

If the debtor does not file: If debtor defaults on credit card payment, debtor will receive the notice from the credit card agencies and attorneys for the recovery of balance amount. Creditors also can file a suit against debtor to recover the amount. They can also create the lien on debtor’s property.

Chapter 7: If debtor is able to claim appropriate exemptions for his/her equity in the property, debtor’s credit card debt will be completely discharged. Most of the cases filed under chapter 7 are no asset cases.

Chapter 13: The amount the creditors receive varies from 0% to 100%.

Personal loans:

If the debtor does not file: If debtor default on personal loan payment, debtor will receive the notice from creditor. Creditors also can file a suit against debtor to recover the amount. Creditors can also create the lien on debtor’s property.

Chapter 7: If debtor is able to claim the exemptions in his/her equity in the property, debtor’s personal loan will be completely discharged.

Chapter 13: The amount the creditors receive varies from 0% to 100%.

Repossession deficiencies

If the debtor does not file: Most of the times, when the house is foreclosed and sold or the vehicle is repossessed and sold, creditor may not receive the amount what they had lent to the debtor. Deficiency will arise on the property sold. Creditors will send the notice to recover this amount. If debtor defaults on deficiency payment, creditors can file a suit against debtor to recover the amount. They can also create the lien on debtor’s property.

Chapter 7: If debtor is able to claim the exemptions in his/her equity in the property, debtor deficiency debt will be completely discharged.

Chapter 13: The amount the creditors receives varies from 0% to 100%.

Judgments:

If the debtor does not file: If debtor default on judgement amount payment, creditors can create the lien on debtor’s property.

Chapter 7: If debtor is able to claim the exemptions in his/her equity in the property, debtor’s judgment amount debt will be completely discharged.

Chapter 13: The amount the creditors receive varies from 0% to 100%.

Lease payments

If the debtor does not file: Landlord can evict tenant from the premises. Creditors can also repossess the leased vehicles.

Chapter 7: Debtor will have the option of rejecting and assuming the Lease.(11 USC Sec. 365. If the lease is assumed, debtor must cure all the defaults. If the debtor has an obligation on the car lease payment and wants to surrender the leased car, any obligation on the car lease payment can be discharged under chapter 7.

Chapter 13: Debtor can assume or reject an unexpired lease under chapter 13 (11 USC Sec. 1322). Debtor will have the certain obligations depending on the assuming or rejecting the unexpired lease.

Personal Guaranties

If the debtor does not file: Debtor may be responsible for the debts for which he has given personal guaranty.

Chapter 7: If the debtor has signed a personal guarantee for others debt, with the few exceptions, debtor liability for the debt will be discharged. Although, debtor can discharge some personal guarantees for which he/she has signed for the corporation, corporation will still owe the debt.

Chapter 13: Discharge of debts under chapter 13 is depend on the circumstances of the case. Debtor can file chapter 13 to pay the debt over the time.

Child support payments and alimony

If the debtor does not file: If the debtor owes arrear on the child support payment it may cause him the trouble including the imprisonment and professional license cancellation.

Chapter 7: Child support payments and alimony cannot be discharged under chapter 7.

Chapter 13: Debtor can propose a plan and make full payment towards the arrears.

Penalties, Fines & Restitution:

If debtor files:

Chapter 7: Penalties, Fines & Restitutions are not dischargeable under bankruptcy (11 USC 523(a)(7) & (19) )

Chapter 13: Penalties, Fines & Restitutions are not dischargeable under bankruptcy. However, it can be paid under chapter 13 plan.

Conclusion:  Bankruptcy is a complex matter. A bankruptcy attorney can only think wisely about each client matter and provide expert opinion on the filing and not filing of bankruptcy depending on the clients issues. If we analyse the filing of the bankruptcy over the last decade, bankruptcy has eliminated many billion dollars in debt. If you are facing a problem in paying back your debt and to analyse your current situation, contact your nearest bankruptcy attorney today.

 

Posted by: sadanandnaik | September 3, 2010

Outsourcing: One Tree, Many Branches

Outsourcing industry is not new phenomenon. Driven by the competition and cheap labor outsourcing of manufacturing jobs took place in 1980. Over the period of 3 decades outsourcing history in India, outsourcing has not just remained as an outsourcing; it has led to many inventions, many new areas, and many branches. Outsourcing industry was a sapling when it was started India. Global business leaders planted this sapling in the past and now it has grown as a big tree. This tree has led to many branches. These branches have led to many sub branches.
Black book of outsourcing identifies outsourcing industry by Business process outsourcing (BPO), Finance & Accounting Outsourcing (FAO), Knowledge process outsourcing (KPO), Information Technology Outsourcing (ITO), Human Resources Outsourcing (HRO), Legal process outsourcing (LPO), Document Process Outsourcing (DPO), and Educational Services Outsourcing (ESO).
In general, outsourcing service providers uses many acronyms in relations to the services they offer.

Manufacture Process Outsourcing: MPO In the beginning outsourcing industry started with the outsourcing of manufacturing processes to India. Today there are thousands of companies in India offering contract manufacturing (CM) services to abroad. For example, VF Corporation, US major in manufacturing of Jeans- manufacturer of jeans is in JV with Arvind Mills to manufacture, design, market and distribute VF’s branded lifestyle apparels.
Nike, a major publicly traded sportswear and equipment supplier based in the United States, is in contract with many companies in India to produce its Nike branded products and export it to them.
Similarly there are thousands of companies in India offering contract manufacturing services to companies abroad. Indian companies manufactures variety of products, right from pens, mobile phones, PDAs, TVs, servers, laptops and other computer equipments, electronic products to ships and aircrafts.
Although the MPO is quite different compared to BPO, KPO and LPO industry, it is the part of the outsourcing and one of the branch of outsourcing. If the cheap labor has made the MPO possible, advancement in the telecommunication, internet and technology, and lower cost have made the BPO, KPO and other outsourcing industries roots in the Indian soil very strong.
MPO has also made the way for medical product outsourcing (MPO), where the medical products are manufactured and supplied abroad. MPO is also the acronym for medical process outsourcing.

Business Process Outsourcing: BPO
BPO process can be defined as the outsourcing of the business process from the country where it is costlier to perform to the area or the country where it can be performed in a decreased cost.
In other words, it is the foreign company or the firm setting up their office (also called as captive BPO’s) and hiring the local staff to carry out the business process or the functions of the firm. It can also outsource the process to third party BPO providers.
Given the proximity of BPO to the information technology industry, it is also categorized as an information technology enabled service or ITES.
It is not clear as to which was the first BPO in India. As per the information given in wikipedia, In the early 1980s several European airlines started using Delhi as a base for back office operations, British Airways being one among them.
In the second half of the 1980s, American Express consolidated its JAPAC (Japan and Asia Pacific) back office operations into New Delhi.
In 1990 GE (general Electric) started to outsource. Later the IT majors like Wipro, Infosys (Progeon), Inforlinx, HCL, Satyam (Nipuna) and Patni entered the BPO market in 2002 .
Today there are many captive and third party BPO providers in India. According to a recent India BPO study by NASSCOM (National Association of Software and Service Companies (India) and Everest Research, the BPO business is expected to touch USD 15-20 billion by 2012 .
The type of business services the BPO industry offers includes Customer Support Services, Technical Support Services, Telemarketing Services, Employee IT Help-desk Services, Insurance Processing, Data Entry Services / Data Processing Services, Data Conversion Services, Book Keeping and Accounting Services, Internet / Online / Web Research etc.
Most of the BPO’s today operate as the back office operations for their US and UK Clients. BPO is the continuous process. For example, purchase of the products and customers transactions in the bank takes place regularly and BPO industry will be having a regular work on customer support services and technical support services. Whereas as in the LPO industry, continue process of the work depends on the number of factors including changes in the legislation and court procedures. LPO work/project is outsourced on the needs of Law Firms and in-house legal departments of the corporations.
BPO industry has led to the several sub branches/sub segments like Financial Process. Outsourcing (FPO), Accounting Process Outsourcing (APO).

Knowledge process Outsourcing: KPO
KPO process can be defined as the outsourcing of the knowledge process (knowledge/information related) from the country where it is costlier to perform to the area or country where it can be performed in a decreased cost.
KPO is an offshoot of BPO. It is one of the branches of outsourcing and sub segment of BPO industry.
As to the origin of the term ‘KPO’ a report by Evalueserve “Origins of Knowledge Process Outsourcing (KPO)’’ states that “Although a few companies began providing higher-end, knowledge-based services as early as 1997, this trend did not gain much momentum until 2003, and it was Evalueserve’s Chief Operating Officer, Ashish Gupta, who coined the term Knowledge Process Outsourcing (KPO) in September 2003, in an effort to differentiate between his firm’s services and those of the established BPO firms.’’

According to a report of National Association of Software and Services Companies (NASSCOM), the Indian chamber of commerce that serves as an interface to the Indian Software industry, Knowledge Process Outsourcing industry (KPO) is expected to reach USD 17 billion by 2010, of which USD 12 billion would be outsourced to India.

The type of services the KPO industry offers s include: Investment research services (equity, fixed income and credit, and quantitative research), Market research services, Legal research services (also known as Legal Process Outsourcing), Patent research services, Engineering Designing, Drafting and Rendering, Mechanical, Structural, Architectural and Civil- Technical Writing & Communications, Remote IT infrastructure Management, Helpdesk, OS, Applications, Database Administration, Maintenance & support, Animation, 2D, 3D modeling etc.

KPO has made the way for many other sub branches like Research Process Outsourcing (RPO) and Legal Process Outsourcing (LPO).

Legal Process Outsourcing: LPO
Legal Process Outsourcing involves in-house legal departments, corporations, law firms or organizations outsourcing legal work from areas where it is costly to perform, such as the United States or Europe to areas where it can be performed at a significantly decreased cost, primarily India.
Legal Process Outsourcing is an offshoot of KPO.
Outsourcing Legal work to India began in 1995, when the US based Bickel and Brewer opened its office, Imaging & Abstract International (captive LPO and Subsidiary of Bickel and Brewer LLC) in Hyderabad. I & A International dealt with digitalization of the legal documents and creating searchable databases such as to scan, abstract and index documents. Later on, the firm hired lawyers to review documents produced in lawsuits. In 2001, GE was the first company to offshore its in-house legal work in India. Since then a lot of companies have entered the arena in one form or other.
Although outsourcing legal work to India began in 1995, the process was not known as LPO until 2005. The term, “LPO” or “legal process outsourcing” is the media invention. It was first appeared in 2005 in the media.
Legal process outsourcing (LPO) is also considered as one of the sub-segments of business process outsourcing/KPO industry.
Today a number of BPO players in the country have started their LPO divisions as part of BPO Divisions.
Several reports on the LPO industry states that LPO is expected to reach USD 4 billion and generate over 79,000 jobs in India by 2015.
Most of the LPO’s in India categorizes the LPO work/Projects as high–end work and low skilled work. Low end work/Low skilled work does not require more application of mind or the law to the low skilled work. Whereas, the high end work requires the application of mind and more knowledge and expertise in the field what the work is about. Lower end work sometimes could be monotonous work. This monotonous work made LPO employees not to stay in an organization for long time and they are tend to work in different LPO organizations. LPO industries today classify paralegal services, legal coding, legal transcription, document management services as lower end tasks jobs. And the legal research, drafting of pleadings, patent drafting, are considered as high end tasks.
Most of the LPO’s in India receive lower end task jobs the same work which can be carried out by paralegals in US. LPO’s in India charge the client on per hour/per line or per page basis.
However outsourcing legal works helps client to save upto 70% of the cost.
The type of services LPO’s in India offers includes personal injury, bankruptcy and foreclosure, contract review and management, legal transcription, electronic discovery etc.
LPO has led to the many other sub branches including Patent Process Outsourcing (PPO). Since the many LPO’s specialized in providing service on particular area of law, it can also lead the way for sub segments/sub branches like E-discovery Process outsourcing (EPO/EDO), Legal Research Outsourcing (LRO), Personal Injury process outsourcing (PIO).

Information Technology Outsourcing: ITO
ITO refers to the outsourcing of the Information technology related work to the country where it can be carried out in the decreased cost. Such as programming, Software Development, Web Designing & Development, Animation & Multimedia, Search Engine Optimization. Even ITO has led to the sub branches like Software Development Outsourcing (SDO).

Human Resources Outsourcing: HRO
It is also called as Recruitment process outsourcing (RPO). Recruitment Process outsourcing is a form of business process outsourcing (BPO) where an employer outsources or transfers all or part of its recruitment activities to an external service provider.
The typical service includes Payroll Processing, Workforce Management, Employee Services, Compensation and Benefits, Resourcing Services, and Talent Management Services etc.

Engineering process outsourcing: EPO
EPO process can be defined as the outsourcing of the engineering process from the country where it is costlier to perform to the area or country where it can be performed in a decreased cost. The services includes CAD, Building Information Modeling, Project Management, Construction management, Structural design, Shop drawing, document management system, Detail engineering, conceptual scheme, Discrepancy report services, quantity estimate services, reverse engineering, reliability engineering, area charts services, code compliance analysis, material specification services, construction documentation, accessibility compliance, records management, energy audits, energy modeling services, landscape designing, site services, topography etc.
The EPO market in India is expected to exceed US $ 40 billion by 2020.
EPO is also the acronym for the Employee Process Outsourcing and Educational Process Outsourcing.

Document Process Outsourcing: DPO
DPO is a specialized area of Business Process Outsourcing involving the outsourcing of Document Processing, to a third-party service provider that is a specialist in that area. Document Processing involves the conversion of typed and handwritten text on paper-based & electronic documents (eg. scanned image of a document) into electronic information utilizing one of, or a combination of, Intelligent Character Recognition (ICR), Optical Character Recognition (OCR) and experienced Data Entry Clerks.

Medical Process Outsourcing: MPO
MPO can be defined as the outsourcing of the medical process from the country where it is costlier to perform to the area or country where it can be performed in a decreased cost.
The type of services the MPO provides includes Medical Transcription, Medical Billing, Medical Coding, Medical Insurance Collections, Healthcare Website Designing, Healthcare Staffing, Medical forms processing, Designing of SEO compatible healthcare websites etc.

Web Development Outsourcing: WDO
WDO can be defined as the outsourcing of the website development process from the country where it is costlier to perform to the area or country where it can be performed in a decreased cost.

Finally outsourcing industry in India is on growth and it is leading to several branches and sub branches. In the future, it may possible through outsourcing and liberalization of industry that a lawyer in India represent/ argue clients before US and UK Courts, an Indian doctor can provide treatment to patients abroad, a Civil Engineer can oversee the construction work abroad, a Teacher can take classes regularly and conduct exams to students abroad.

Posted by: sadanandnaik | September 3, 2010

What contributes to the success of LPO

LPO is not a new phenomenon, driven by the competition, temptation of lower cost and client’s preference to have quality work with lower cost led to the emergence of Legal Process Outsourcing in 1995. US based Bickel and Brewer was the first law firm to outsource its legal processes to India in this regard. Thereafter, many LPO’s got established and some of LPO’s were closed down as they were not able to get the projects and not able to convince the benefit what the LPO industry is offering for.

As Mr. Sanjay Bhatia, head of operations for SDD Global in his recent blog “Starting Your Own LPO? Here’s How To Do It. And How Not To” states “The most common mistake LPO entrepreneurs commit is believing that in order to succeed, all they need is a good office, infrastructure, internet connectivity, a well-designed website, and a legal team”. In fact, all these contribute towards the success of LPO’s, there are many other factors which can really contributes towards the success of LPO’s.

Setting up an LPO and hiring the people experienced in Legal Process is not a difficult thing. Successfully continuing with the LPO industry, having LPO projects throughout the LPO process, and providing quality work to the clients who trust us really matters.

Law firms and in-house legal departments of the companies do not approach you for outsourcing their project unless you have established yourself as the good and competitive in the LPO industry or have established yourself good for the quality of the work.

Many LPO’s have been set up as part of the BPO division. Many companies run their LPO division as their competitor runs the LPO division.
Many companies are running the LPO division with the loss and use the money generated in other divisions to run the LPO division.

In spite of all these, LPO industry still has a growth. Today’s outsourcing industry is the result of GATT/WTO. Non discrimination and the fair treatment are the main principles of WTO. WTO promotes the free movement of services and products in WTO member nations. As the many industries are witnessing globalization, legal industry will be liberalized and the LPO industry will witness the huge growth.

Delay in accepting the new change is common in many industries. When someone starts to utilize it and tells the benefit of it, gradually others will start to adopt it. LPO industry is the same thing in this regard.

Outsourcing a process to LPO does not depend on the single partner of the firm, all partners’ needs to have consensus. It may take some time to arrive at the decision. But one day, most of Law firms and in-house legal departments of the corporations will accept the new changes and utilize the quality of service which the LPO industry offers.

Going through the success of LPO’s in a LPO industry, many factors will contribute towards their success.

Management: The management of the LPO’s includes head of the Law Firm or partners of many international law firms, experienced lawyers of USA, UK, and India. They are the main contributors towards bringing the projects to the LPO Division. They will also provide adequate training to the employees on their process. The work is also properly supervised by the US and UK Lawyers.

Marketing: Marketing is the backbone of every business. An important aspect of the LPO job involves finding new clients, developing and managing relationship with the clients. LPO industry cannot survive without clients or without any projects. Many leading LPO’s in India have got marketing professionals by the designation of marketing executive, senior marketing executive, assistant manager, manager, project manager, assistant business development officer, and business development officer. Most of the marketing professionals are from LLB and MBA education background having experience in International marketing and have got good communication and presentation skills. Even some attorneys act as the marketing professionals and get new clients to the firm. Marketing professional in the LPO will be having a clear understanding of legal procedures and working of LPO. Their main role includes looking for foreign law firms, in-house corporations who are willing to outsource their legal process to India. A marketing professional needs to introduce the company and its capabilities, needs to understand the company he is contacting, its history, partners, and directors. Then he shall discuss LPO services to such law firm or the company and discuss their pain areas or areas where we as company/LPO could work together and suggest Legal Outsourcing as a solution. Besides these roles and responsibilities a marketing professional needs to conduct extensive market research, shall be willing to travel, make cold calls, make presentation to the clients, conduct videoconferencing, teleconferencing, handle the client visits, requires to prepare a detailed business plan to sight goals and objectives, target markets to bring account to the LPO. He shall also be ready to spearhead the business development activities for the given region, willing to work as per regional timing and always look for expansion of the LPO business and lead to earn more profits.

Employee’s recruitment, training and salary: In many LPO’s one need to complete 3-5 rounds of interviews(written, oral and technical) to gain entry into the LPO. After the recruitment, a candidate needs to undergo project specific and other training for 3 months by LPO industry leaders, attorneys, solicitors and clients. Sometimes there will be an on job training.
Most of the successful LPO’s in India employs more than 100 employees consisting of Attorneys, solicitors and paralegals.
The salaries in the most of leading LPO’s ranges from 20k to 25k for freshers and 25k to 35 for one or two year experienced professionals. Besides these, health insurance facility, free club memberships, cab facility are provided to an employee.
Most of the employees in LPO sector work for 8 hours per day, they also work in shifts as the many LPO’s in India work on 24X7 basis. Employees will be having two days weekly off and other leave benefits.

Quality: ISO 8402-1986 standard defines quality as “the totality of features and characteristics of a product or service that bears its ability to satisfy stated or implied needs.” Quality refers to Measure of excellence or state of being free from defects, deficiencies, and significant variations. The services what we provide for the clients must be free from errors. LPO shall provide the quality beyond their client expectation. Many LPO’s adopt Six Sigma methodologies in their quality process.

Client relationship management (CRM): As the getting new client is difficult thing, maintaining the proper relationship with the client is also a difficult. A proper client relationship must be maintained when we provide quality of services to the client and when they are more reliable on us. It also involves attracting and winning a new client, retain the client, entice the former clients back into the fold.

Infrastructure and security: Many successful LPO’s in India has secured infrastructure includes owned office place, secured FTP servers for uploading and downloading data, high speed broadband internet connectivity round the clock. Telephonic calls including conference calls, online meeting, Encrypted emails, secured VPN technology, Citrix web access, Web accessible secure online databases, Extranets, FTP sites, Access via Firms collaborative document sharing and database applications, Uninterrupted power supply and backup.
Many LPO’s have got physical security including video surveillance, security guards at all important locations, adequate fire protection.

Data security and Confidentiality: In many LPO’s employees need to sign non disclosure agreement and the employees are provided with unique user accounts and password, and passwords are changed periodically. Every computer and folder is password protected. Surveillance cameras or closed-circuit security cameras are fixed to track the employee’s movements. Personal communications or data recording devices, such as mobile phones, handbags are not permitted anywhere in the working premises.
It is not possible to access the work of team by the other team. All incoming and outgoing mails are monitored on exchange server, and all attachments are filtered.

Social media internet: Social Media is the latest networking tool for LPO’s and Attorneys. It is the great tool for capturing new clients. Many LPO’s in India have got their own Blog page about LPO and they are in touch with many of leading news papers of the USA and UK to give an insight on LPO sector.
Attorney of a law firm, and lawyers of in-house corporations, are increasingly reading blogs and participating in social media these days. They will be interested to find latest information on the industry within less time
According to Technorati’s State of the Blogosphere 2008 report, the number of American blog readers grew to 60.3 million in 2008
Many leading LPO’s in India have got their company profile in Linkedin. Many companies and attorneys use Linkedin, twitter and facebook. Social media can help LPO’s to understand individual client personalities. LinkedIn is a powerful professional network, with members from each of the fortune 500 companies. LPO’s in India can effectively use social media for its growth.

Back office operations: Many of the LPO’s In India acts as back office for many departments of corporations and Law Firms abroad.

LPO website: Having well balanced web presence is the best tool for developing the online marketing which attracts the clients. The website shall have proper design to attract clients; it shall capture the attention of clients in seconds. Website content can increase LPO’s search engine ranking, educate and qualify prospects, and enhance LPO’s credibility. Once potential client arrive at LPO’s Web site, the content must win him over and move him to make a call to an LPO. Most of the successful LPO has the features like search within the website, news on LPO, sitemap, work samples, management and LPO team member’s profile. A well crafted online video made available on LPO website or you tube also can help LPO’s to connect with more clients and promote an LPO.

SAARC: SAARC is not the South Asian Association for Regional Cooperation in LPO term. It refers to Speed, Accuracy, Availability, Reliability and Cost (SAARC). While the Speed refers to the time taken to carry out any of the service functions, Accuracy ensures the completeness in carrying out the communicated function with respect to a reference level, Availability refers to the likelihood with which the relevant components of the service function can be accessed for the benefit of the customer at the instant of request, and Reliability refers to the probability that the service function will perform within the specified limits for speed, accuracy and No information is to be supplied to an unintended party, nor can information be changed by an unintended party. Finally, the cost is the major factor in outsourcing the LPO projects and it involves performing the work in decreased cost compared to the work performed in US and UK. It involves cost saving upto the 70%.

Posted by: sadanandnaik | March 18, 2010

Factors to consider before outsourcing an LPO project

LPO industry is on growth today and expected to reach $4 billion by 2015. Many law firms and in-house legal departments of the companies hire the services of LPO providers on a temporary or ongoing basis.

Many law firms in UK, USA, and Canada receive a calls, mails from LPO providers from India, Philippines, and South Africa.

Legal outsourcing makes the lawyers to reduce a cost to the client; it will also allow them to have extra hours by hiring external staff. It is possible through outsourcing that an attorney can send documents for review before he heads home in the evening and have it ready on his desk in the morning.

The law firms and companies today needs to recruit more people when they need to handle the more matters and need to downsize during less busy times. This problem does not arise when they outsourcing it to LPO provider. The work can be outsourced on the business requirements. Besides they can save money on the infrastructure, maintenance and the cost on the new technology.

However, it depends on the organization and the firms need for legal outsourcing. Law firms and in-house legal departments of companies need to think whether there is any need for outsourcing legal work to LPO provider, and the benefit they are getting from LPO providers.They also need to think how much they can save in terms of costs and what is the quality of work they would receive from LPO providers.

Who requires the LPO Services?
1. Law firms: The cost involving the maintenance of the office and an expenditure on the technology is increasing. Many of the law firm clients prefer for the low cost services with the high quality. LPO industry is only the answer for all these needs.
2. In-house legal departments: Although legal departments of the corporations do not generate revenue for the company, it will defend the company from law suits. In- house legal departments of companies these days requires the more staff on managing the documents, they need more staff to review the documents before suing any parties. LPO providers can effectively manage the legal documents and analyze the documents before suing any parties. It can also utilize the LPO provider services to draft all types of agreements related to business transactions of the company.
3. Law firms expecting more work or intending to increase the size of the firm: LPOs are not against to hiring practices by law firms. Law firms can also hire the external services or have a contract with LPO providers to act as the back office operation of the Law Firm.
4. Firms / companies especially set up for getting the clients and outsourcing: After going through the success of LPO industry, firms and companies are being set up especially for getting the clients and outsourcing legal work to the LPO providers. These companies and firms mainly act as the mediators between the LPO providers and Law firms.
5. Individuals: One of the benefits in Common Law Countries the citizens have got is, individuals need not be always represented by Lawyers in courts. They can individually file complaints or defend the cases. But it would be difficult for an individual who does not have the knowledge of law. Law also states the Ignorance of law is not excusable. Today, it is possible for Individuals to represent themselves before the court with the help of LPO providers. E.g. In a foreclosure and bankruptcy proceedings, the debtor may not be having money to afford a lawyer, he will surely outsource it to the LPO providers.

Before outsourcing legal work
Although many LPO providers claims to be having experienced in all areas of law, and claims to be having such number of attorneys and paralegals, the answer to the question would be known only when we personally visit the facility of the provider and having an interview with the lawyers and paralegals working in LPO. Hence, it is very important to take many steps before outsourcing.

When you are outsourcing a small project you can outsource the work after having formal interview, video conferencing or VOIP session with the LPO provider and after going through the sample work done by them.

But when you are outsourcing a major project, you need to take many steps to know that particular LPO provider is capable of performing the work as expected.

Before outsourcing legal processes to LPO provider……..

1. Go through the LPO provider profile on the web and attorney profiles if any
2. Enquire about the type of training they are providing to lawyers and paralegals at the LPO organization.
3. Ask them for the case studies and sample work
4. Send the sample project for solution and ask them how much they can save in terms of cost on particular project. Ask for detailed report on how they can solve it, the technology, and software’s to be used on particular project, number of attorneys and paralegals to be assigned on the project, and the time limit within which they can complete the project.
5. Send the trial work to ascertain the LPO provider’s ability to complete the work with high quality. Suppose the work involves document review of millions of document. Send only hundred or thousand files for document review to ascertain the quality of work.
6. If the trial work is done properly, have a telephonic interview, video conferencing, or VOIP session etc.
7. Have the necessary agreements with the LPO provider. E.g. Service provider agreement, service level agreement, confidentiality agreement etc…
8. Visit the facility: When you are outsourcing major project, visit the provider facility and speak to the Team who are going to work on you project
9. . Check for data security and confidentiality
10. Check the support and training required from your side.
11. Client consent: Although it is not mandatory to disclose to the client that his work being outsourced, it is the obligation on the part of the Law firm to inform to the client that his work being outsourced.
12. Client fee: it is not mandatory to inform to the client about the fee agreement with the LPO vendor.

American Bar Association Formal Opinion 08-451:
Even the formal opinion of the ABA Standing Committee on Ethics and Professional Responsibility (Formal Opinion 08-451), in its Lawyer’s Obligations When Outsourcing Legal and Nonlegal Support Services. States…….
1. Supervise the work throughout the project
2. conduct background checks of any lawyer, nonlawyer or placement agency involved
3. Interview the lawyers involved, and assess their educational background;
4. inquire into its hiring practices so as to ascertain the character of the employees who are likely to have access to client information;
5. Investigate the security measures in effect in the provider’s premises, including its computer network and refuse disposal systems;
6. Make reasonable efforts to ensure that the person’s conduct is compatible with the rules of professional conduct.
7. Have a personal visit to the location where the work is performed in order to get firsthand sense of its operation and the professionalism of the lawyers and non lawyers involved.
8. Ensure that the legal training received in that country is comparable to that in the United States,
9. Ascertain the extent to which client property and other confidential client information may be subject to seizure in local court proceedings.
10. Evaluate the risk that client information may be lost or the project disrupted in the event of a dispute between the lawyer and the service provider.
11. Oversee the execution of the project adequately and appropriately
12. Inform the client about outsourcing their work to LPO provider and get the consent if necessary
13. Verify that the outside service provider does not also do work for adversaries of their clients on the same or substantially related matters

Posted by: sadanandnaik | March 6, 2010

LPO as career for lawyers and law graduates

LPO for Law graduates:
Starting a career as a lawyer in court is really difficult for a junior, one need to practice under a senior lawyer for years and it is really difficult to establish one’s own practice.
India
Earlier, in India after graduation, one had to do 2 years of LLB degree and 1 year of practice under a lawyer to work as a lawyer, later the 3 year course was introduced with the court visits in the final year. In 1985, five year LLB course was introduced. Many students in India applied for LLB 5 years course just because they did not get the medical and engineering seats.
In India one has to complete 12 (10+2) years of education to apply for 5years of LLB, and one has to complete 3 years of graduation course after 10+2 to apply for 3 years of LLB course. Students applying for 3 years of LLB in India have come down of recent.
There are about 700 Bar Council approved law colleges in India and about 80,000 law graduates passes out every year.
There are only few national law schools in India, one has to write Common Law Entrance Test (CLAT) to be eligible to get into these premier law schools. The salaries of students passing out from these schools have crossed more than 12 lacs per annum.
Only few graduates make hard effort and join a corporate law firm. Many of the law school students passed out of national law schools get into corporate law firms and in-house legal departments of companies.
In India, after 5 years of the law graduation, many of the graduates enrol themselves in the state bar council and start practice under a senior lawyer or a law firm having 2- 20 lawyers.

United States (USA)
In USA, after 12 years of education ( i.e. after secondary education), one has to complete 4 years of bachelor degree and score at or above the seventieth percentile in the Law School Admission Test (LSAT) to apply for Juris Doctor (J.D.). There are 200 American Bar Association accredited law schools (188 with full accreditation and 12 with provisional accreditation) in the country.
In USA, J.D is a 3- 4 years course which make them to earn a degree in Law.
Once the J.D. is completed, candidates require to appear for the bar exams of particular state to practice in such state. In USA, it is a difficult task to get into the top Law firms in the country.

United Kingdome (UK)
In UK, after 13 years of education, ( i.e. after GCSE and A-level), one applies for LLB or diploma in Law and then takes a one year Legal Practice Course (LPC) to become a solicitor or Bar Vocation Course to become Barrister. LPC is usually followed by two years’ apprenticeship, known as a training contract. Bar Vocational Course (BVC), followed by 1 year training in set of barristers’ chambers, known as pupilage.
There are also other graduates, who after their graduation apply for Common Professional Examination (CPE) (also known as law conversion course or the Graduate Diploma in Law (GDL).
Foreign lawyers become solicitors in UK and the numbers of solicitors are on growth.
It is difficult to have a training contract in UK. It is also difficult to join top law firms in UK.
Since the LPO industry is on growth, LPO industry is the best option for Law graduates of India, USA and UK as it gives more stability and career growth.
There are many LPO’s in India offering Indian fresh law graduates the post of legal assistant, legal associate and legal executive or associate attorney at the entry level.
Law graduates from USA and UK can join the LPO industry and assist the LPO team. They can also take role in the marketing and business development of the LPO, they can also act as the coordinator between the LPO and the clients.

LPO for Lawyers:
Law education is not perfect unless you start practice in court for some years. All the law graduates are not lawyers, but all the lawyers are law graduates. Lawyer profession is also called as the noble profession. Lawyers are considered as the officers of the court in India.
Some people describe the law profession as “work- no money, work- money, and no work- money”. It is evident that where you will start to practice with no money for few years and start to earn money as you continue practice and at the later stage, you will be having no work, only money – your juniors will carry out every work.
Lawyers represent the plaintiff and defendants in the case and take a lead role in drafting of contracts, registration of properties, companies etc…
Lawyers’ roles vary depending upon the area of law they practice and the firm where they practice.
There are about 1 million lawyers in India, more than 1 million in USA and about 80,000 solicitors in UK.
If you are not having a good practice as a lawyer/ attorney/ solicitor or interested into a LPO, LPO is the better option for the Lawyers. LPO sector today needs the service of Lawyers having good drafting skills, it would be easier for lawyers draft complaints, motions and to research on the legal issues faster then the fresh law graduates. Lawyers also can take up the review of work done by the junior level LPO employees in the LPO sector.
As the US and UK lawyers are concerned, they can have partnership with the LPO vendors and share the profit. They can also take part in review and supervision of LPO work.

Designation:
LPO industry today offers many designations depending on the nature of work involved. E.g. Legal executive, legal assistant, associate attorney and legal associate at the entry level. Senior legal executive, Senior legal associate, assistant team Lead, and team lead after 2 years of experience. And Assistant manager, Manager, Assistant project manager, project manager, Vice president etc… after 3-7 years of LPO experience.

Salary:
The salary for entry level varies from Rs.8, 000 to Rs. 20,000 depending on the firm and reputation it has got.
Team lead would be getting salary of Rs. 20,000 to Rs. 50,000, and the Assistant project manager salary would be Rs. 40,000 to Rs. 60,000.
As the lawyers of UK and USA are concerned, the salary depends on the current salary offered for lawyers in US and UK.

Posted by: sadanandnaik | February 11, 2010

Need for legal malpractice insurance today

There are about a million lawyers in USA. The lawyers in USA are on growth. Many number of law graduates passes out every year and joins a law firms. The client case always cannot be won. There will be verdicts in favor or against a client. Negligence on the part of the lawyer will also contribute towards the losing of case.
A legal malpractice case is set back towards the growth of the law firms if there is no effective legal malpractice insurance for the firm.
Legal malpractice is defined as any negligent or wrongful act committed by an attorney that causes damages to his or her client.
There are many types of insurance available today. Legal malpractice insurance which comes under the professional liability insurance refers to an insurance provided by the third party towards the claim of a client against an attorney. If the clients sues an attorney for legal malpractice, although attorney is liable for the amount claimed the Legal Malpractice Company/ firm pays the amount. Hence there would be no burden on the lawyer paying the huge amount.
According to the statistics, every 5 out of 100 attorneys in USA are facing legal malpractice cases. More than 35,000 cases are filed annually on the alleged legal malpractice of attorneys. 25% of the legal malpractice cases are related to personal injury, 23% are related to real estate, 11% is related to Bankruptcy and collections and the 8 % is related to family law. As a general rule, legal professionals are not required to obtain legal malpractice insurance. Only 60% of attorneys in USA have legal malpractice insurance
Legal malpractice insurance available to lawyers and law firms may be classified into many such as: Individual, Small, Medium, large Law Firms and medical malpractice insurance for employed lawyers.
Individual lawyers availing legal malpractice insurance is lesser today. And the legal malpractice insurance offered to small law firms are lesser.
Working in a legal department of a non- legal corporation does not make the lawyer immune from claim, legal malpractice case on the lawyers employed in corporations also increasing.
It is also mandatory under certain law to disclose about the professional liability insurance with the client. E. G. In California, Rule 3-410 of the Rules of professional Conduct which is effective from January 1, 2010, It is mandatory on the part of an attorney to inform about the professional liability insurance in writing to the client at the time of clients engagement. Most state or county bar association lawyer referral programs require their member attorneys to be insured
In many states, counties and cities, bar association “endorsed” insurance programs are aggressively marketed.
While defending legal malpractice claims, attorneys not only lose money but also valuable time. The average figure may vary from 250 to 300 hours per case that can be billed. This insurance protects a lawyer for each lawsuit he has to face.
Thus, attorney malpractice insurance becomes necessary. In many of the legal malpractice claims, insurance company negotiates with the victims and offers the compensation. In most of cases, insurance company designates a law firm for the representation of the defendant.
Since the legal malpractice cases are on growth, there are many law firms in USA exclusively offering their service on Legal malpractice cases.
The cost of a policy is directly influenced by the degree of risk involved in the profession. For example, if a lawyer/ law firms are into banking or real estate, the cost may be quite higher than a regular cost of a policy.

Most professional liability policies are written on a “claims-made” (i.e. coverage will apply to a claim made against the insured within the coverage period provided by the policy regardless of when the injury occurred) basis, though sometimes coverage is available on an “occurrence” basis.
There are also coverage like Tail Coverage which is runs for a specific number of years that coverage will exist when a law firm cancels its insurance policy or dissolves. Coverage also will continue for a lawyer who retires or leaves private practice to become a teacher or assume a judgeship
There are also Specific Coverage a specific area of law that is high risk, such as securities, banking, personal injury and real estate, may have higher insurance premiums and coverage limitations that may apply. Some policies may not cover some forms of legal malpractice such as fraud theft or willful injury.
Deductibles: A deductible applies to a professional liability policy just like any other type of insurance policy that is issued. A deductible typically applies to loss and defense costs. A higher deductible may be required by an insurer for high risk individuals. A high deductible also can be used by the insured to lower the cost of the policy. Deductibles can apply per policy claim or paid on an annual basis.
Coverage Agreement and Exclusions: Individuals who purchase a professional liability insurance policy should always read the coverage agreement and review the policy’s exclusions. The coverage agreement provides details about the coverage and any additional people covered by the policy. The exclusions on a policy are acts by the insured that are not covered by the policy or are covered by another type or kind of insurance.
Even more important is the question of whether claims expenses are including within the limits of liability or whether they are payable in addition to the limits of liability. Even when claims expenses are payable outside the limits of liability, some carriers provide a specific, separate limit for defense (usually equal to the limit for damages), while some carriers are silent on the issue, which – theoretically, at least – means that claims expenses are unlimited.
There is also an issue about coverage of lateral hires. Many insurance carriers will customarily cover the attorney from the date of hire, on the assumption that the former firm’s policy will respond to claims arising from the time that the attorney was employed by or a member of that firm.
It is really difficult to find out whether particular attorney or law firm carries Legal malpractice insurance as the many state law does not make it mandatory to disclose it to the client. However, it is good on the part of the client to get such information from an attorney.

Posted by: sadanandnaik | January 22, 2010

LPO trends for 2010

Everyone speaks about the LPO trends, projections and predictions for 2010. According to Valuenotes outsourcing research organization, 20% of the LPO have withdrawn from the industry in the last two years . According to the 2010 LPO predictions by Integreon, the biggest LPOs will reach 500+ lawyers working on document review, contract management, and due diligence projects and some smaller providers will exit the market altogether .

Chicago based independent legal process outsourcing advisory firm Fronterion states that leading LPO location, India will face competition from emerging nations like South Africa and the Philippines . It also maintains that the India is currently the leading geography for legal outsourcing with over 85 per cent of offshore legal outsourcing .
Frankly speaking, India has not achieved a growth as expected, but there are still hopes for the growth of LPO in the country. As I said in my earlier blog the success of LPO depends on the quality of service we provide to the client and the client we work for. Size of the LPO does not matter. Even small LPO make huge revenue by doing legal research and corporate service work which may be equal to the revenue generated by the larger LPO’s doing paralegal services.

Although the liberalization of the legal industry in the country is on hold due to the recent judgment passed by the Bombay High court, there is a pressure from US and UK to open up the Indian legal market. There are many questions being asked to the Indian legal fraternity that if the Indian lawyers can practice foreign law being in India why the foreign law firms cannot practice their own law having offices in India.

However, opening up the legal market for the foreign country shall depend on the reciprocal basis. We need to look at the respect given for Indian law firms and lawyers practicing in that country and the procedure involved in that and on the same basis India can open up its Legal market.

As to the competition by other countries are concerned, there are about 22,000 attorneys in South Africa, about 7,000 Lawyers in Sri Lanka and about 40,000 lawyers in Philippines. Out of these numbers of lawyers, only few are into the legal outsourcing sector. They are mainly offering legal transcription services as part of BPO services or as part of their law firm services in that country. Since India has a large number of talented lawyers, India would retain more than 85% of the legal outsourcing work worldwide and the work on electronic discovery will increase two fold as the foreign companies require an early assessment of the cases for their higher chances of winning and defending the cases.

Posted by: sadanandnaik | November 26, 2009

Globalization of Legal Industry

Globalization:
There is no specific term as to the meaning of Globalization (G11N ). Different dictionaries give different meaning of the word ‘globalization’. However the term globalization is used in many contexts referring to particular industry. In the business and financial context it would mean that the increase of trade around the world, especially by large companies producing and trading goods in many different countries or a Tendency toward a worldwide investment environment, and the integration of national capital markets .
IMF defines globalization as ‘the process through which an increasingly free flow of ideas, people, goods, services, and capital leads to the integration of economies and societies. Major factors in the spread of globalization have been increased trade liberalization and advances in communication technology’ .

Globalization (globalisation) describes an ongoing process by which regional economies, societies, and cultures have become integrated through a globe-spanning network of communication and execution.
In general globalization is the a governmental policy favoring free trade, open borders, the free movement of capital and goods (but not always of people), elimination of tariffs and price controls (including artificial control of currency values), and the privatization of publicly-owned or controlled enterprises
Factors that have contributed to globalization include increasingly sophisticated communications and transportation technologies and services, mass migration and the movement of peoples, a level of economic activity that has outgrown national markets through industrial combinations and commercial groupings that cross national frontiers and international agreements that reduce the cost of doing business in foreign countries. Globalization offers huge potential profits to companies and nations but has been complicated by widely differing expectations, standards of living, cultures and values, and legal systems as well as unexpected global cause-and-effect linkages. See also free trade .

Today, it has become possible that setting up of manufacturing units in the country where the labor is cheap and selling the goods all over the world. There also a growth in the services sector.
Although world globalization is popularly used today , elements of globalization can be found when the companies started to operate in many countries- elements dates back to 17th century where the companies like British East India company (founded in 1600) and Dutch East India company started to operate.
Dutch East India Company (Vereenigde Oostindische Compagnie or VOC in Dutch, literally “United East Indies Company”) which was founded in 1602 was the World’s First Multinational Corporation to be owned by investors through the issuance of stock equity It was also the first MNC to start a stock exchange in Amsterdam in 1602 .
However modern globalization began when great depression in the international trade took place in 1930s and various countries imposed import restrictions for safeguarding their economies. The USA made many proposals for extending international trade & employment. In 1947, 23 countries signed an agreement (GATT- general agreement on tariffs & trade) related to tariffs imposed on trade.
On 1st January 1995, the WTO replaced GATT, which had been in existence since 1947, as the organization overseeing the multilateral trading system. Upon signing the new WTO Agreements, members of GATT became the WTO members.
The World Trade Organization (WTO) which consists of 153 member nations deals with the rules of trade between nations at a global or near-global level. WTO is an organization for liberalizing trade, a forum for governments to negotiate trade agreements, and a place for WTO members to settle trade disputes.
Today’s Globalization is the result of WTO, fair treatment and the non discrimination is the main principals of WTO.

Globalization of Legal Industry:
Globalisation of legal Industry refers to the opening of legal market/industry in the country to the other nations so that they can set up law firm and offer consultancy services, practice law.etc

Globalization of Law:
Todays modern law passed by the countries in relation with the business, Intellectual properties, corporate law, banking, Internet law reflects the laws of many nations. Amendement to the these laws are carried out to accommodate such changes.
Legal education today is shifting from traditional methods of teaching to more innovative approaches. As we see in many country law schools the law subjects are similar to the other countries as to the basics of law, jurisprudence.
There is also an International law which governs the International Treaties, agreements. Intrnational law today is weak in context of enforcement,compared to the domestic law. As the nations are members of United Nations, sanctioning countries in violition with the International Law lies with the Security council.

Globalization of Legal Profession:
The history of legal profession dates back to the ancient Greece and Rome. Earlier the individuals were supposed to plead their own cases, which was soon bypassed by the increasing tendency of individuals to ask a “friend” for assistance. However, around the middle of the fourth century, the Athenians disposed of the perfunctory request for a friend.
In 204 BC , a law enacted by Romans, barred the advocates from taking fees.Later it was abolished by Emperor Claudius, who legalized advocacy as a profession and allowed the Roman advocates to practice openly
Today one needs to complete the law education approved by the Bar council and has to pass the bar exams of particular state and enroll before the sate to practice in the state.
However, the liberalization in the legal profession has made an individual/lawyer to practice law in other country.

1.England and Wales:
There are about 10,000 Barristers and 60,000 of solicitors in England and Wales today. The General Council of the Bar (known as the Bar Council) and other laws govern the barristers in UK and the Law Society of UK governs the Solicitors in UK. Only the Solicitors and Barristers are allowed to practice in the UK.
Practice of law by foreign lawyer:
Even the Foreign Lawyers eligible to be enrolled as the Solicitor of in England and Wales if he get through in the qualified lawyers of transfer Test(QLTT)
The Qualified Lawyers’ Transfer Test (QLTT), England ’s official transfer exam for foreign attorneys. It is a test in which candidates are expected to demonstrate a basic familiarity with English statutes, cases, practice rules and the principles of common law. QLTT Exams are conducted in many countries annually. The test covers four heads (subject areas): Head 1 – Property, Head 2 – Litigation, Head 3 – Professional conduct and accounts, Head 4 – Principles of common law. There are exemptions to certain countries on this. Generally lawyers from common law countries who have studied their law in English medium needs to sit for professional conduct and accounts ( head 4 ) exam only. However most of the US attorneys need to get through in head 1, 2, and 3 also.

2.Singapore:
As on 2006,there were about 3,476 advocates and solicitors in Singapore. The Law Society of Singapore governs the represents solicitors and maintains and improves standards of conduct and training.
The Legal Profession Act (1967) governs the legal profession in Singapore.
Foreign lawyers are regulated by the Attorney General’s Chambers . The AG’s chamber registers and regulates foreign lawyers. It also formulates laws, rules, guidelines and policies relating to joint law ventures, formal law alliances, representative offices, foreign law firms and foreign lawyers practicing in Singapore and advises on the practical application of the laws governing the legal profession.
Foreign lawyers are required to register individually with the Attorney General’s Chambers in Singapore. Foreign lawyers cannot be sole practitioners and must work as employees, partners or directors in one of the following practice vehicles: As a foreign law firm, A Joint Law Venture (“JLV”),A Formal Law Alliance (“FLA”), As a foreign lawyer in a Singapore law firm.

3. South Africa
There are approximately 13 000 practising attorneys . Law Society of South Africa and regional law societies regulates advocates (barristers) and attorneys (solicitors).
According to section 15(1)(b)(iii) of the Attorneys Act, only the south African LLb holder is allowed to practice in the country. The Act also makes permanent residency or citizenship prerequisite as well as the passing of the South African Attorney’s Admission Examination prerequisite to the admission as attorney in South Africa.
There are certain exceptions to this rule. The Attorneys Act itself relaxes admission requirements with regard to candidates hailing from certain designated countries do not have to serve as candidate attorneys and can be exempted from the need to obtain a South African LLB degree as well as from the need to sit for the South African Attorneys admission examination
Foreign lawyers may establish under home title (e.g. as a Solicitor of England & Wales or as Attorney in USA) and are permitted to practice home and international law. In addition, they can also practice: international finance, project management, and arbitration.
Certain work relating to litigation, appearance in court and conveyancing can only be conducted by South African attorneys. Foreign firms are not permitted to practise local law or to enter into partnerships or fee-sharing arrangements with South African firms. Foreign law firms today have hired.
To practise local law, a foreign lawyer must requalify as a South African attorney. In order to be admitted as an attorney, an individual must have: an LLB degree from a South African university, two years’ service under articles of clerkship with a South African firm of attorneys, successful completion of the attorneys admission exam, South African citizenship or a permit for permanent residence in South Africa, Foreign lawyers must, in addition, attend a training course recognised by the provincial law society and then apply for admission as an attorney .
Changes to the regulation of the legal professions, including the recognition of foreign legal qualifications, are planned. It is likely that a panel will be established to evaluate foreign qualifications under the long-awaited Legal Practice Bill which is released for comment and a draft in progress.

4.UAE
In UAE, Foreign lawyers can practice local law, but only a Dubai national can appear in court in Dubai.
A lawyer who is a national of one of the other Arab Gulf Cooperation Council countries can in certain circumstances obtain a licence to practise and to appear in the Dubai and UAE courts. Practising lawyers have to be licensed to practice law in the Federal courts by the Ministry of Justice and by the Emiri Diwan in the other Emirates. Lawyers must be graduates of a recognised law/Shariah college. The UAE is a member state of the WTO and has scheduled commitments to liberalise its legal services sector under the General Agreement on Trade in Services (GATS).
There are many foreign law firms in UAE today recruits the lawyers from UAE for their practice in UAE courts .

5.Oman
Royal Decree 108 of 1996 regulates the legal profession in Oman. There is no independent bar association or law society. The ministry of Justice maintains a committee to regulate the activities of domestic and international lawyers.
Foreign lawyers are overseen by and required to be registered with the Ministry of Justice in accordance with Royal Decree No. 108/96 regulating the conduct of the legal profession in Oman. Foreign lawyers are required to be licensed to practice in Oman by the Ministry of Justice. At present foreign lawyers can advise on Omani law and if they speak Arabic they can appear before the Omani Courts. Foreign law firms were previously, pursuant to Royal Decree No. 108/96, required to introduce Omani partners into their practices by 31 December 1999. However with the introduction of Royal Decree No. 16/2000, the foreign law firms who had been granted licenses prior to the date of introduction of this law have been given a further extension of 3 years whereafter they will be required to form partnerships with local lawyers in order to establish or have an office in Oman.

6. Abu Dhabi
International law firms can apply for a license directly from the Executive Council in Abu Dhabi. Firms established outside of the UAE will be able to set-up branches in Abu Dhabi provided they satisfy certain conditions. Such as:
1. To have practiced law outside of the UAE for at least 15 years;
2. To have, in aggregate, at least 50 partners;
3. To obtain the consent of the Executive Council of the Government of Abu Dhabi (the “Executive Council”); and
4. To register the branch with the Abu Dhabi Department of Planning and Economy.
The application to the Executive Council must be accompanied by the following documents:
1. A “statement of capabilities” or a “CV” of the firm, containing the type of activities carried out by the main branch, the areas of specialisation and past experience
2. A certificate from the official body under whose supervision the main branch works (such as the “Law Society” or “Bar Association”).
3. A Resolution by the firm’s management to open a branch in Abu Dhabi, specifying the name of the resident partner(s) who will manage the branch;
4. A certificate issued by a bank indicating the financial status of the main branch,
5. The CVs, academic qualifications and professional licenses issued to the legal consultants selected to reside in Abu Dhabi, who may not be less than five, including one or more partner;
6. A draft plan for training and qualifying UAE law school graduates to carry out legal consultancy work, including training them at the main office, and
7. An undertaking from the managers of the main branch that the Abu Dhabi branch will carry out its activities according to the highest professional standards. .

7. California
There are over 160,000 active lawyers in the State of California. Only the lawyers who have passed the bar exams and enrolled before the California bar council are allowed to practice in California. Lawyers from the other states of California can take up the Bar exam and enroll before the bar council of California to practice in California.
Solicitors qualified in England and Wales can sit for bar examination on the basis of the solicitor qualification (Rule 4.30 of the Rules of the State Bar.)
An alternative route for foreign lawyers to practice in California is available via a Foreign Legal Consultant license which permits foreign lawyers restricted legal practice within the State on the basis of their home country qualifications and experience. A Foreign Legal Consultant in California may provide legal services relating to the law of the country in which they are licensed to practice law. They must file an annual report with the State Bar of California and an annual renewal fee. Foreign Legal Consultants are subject to certain restrictions: they cannot provide legal advice on the law of the State of California nor on the laws of the USA; they cannot appear in court as an attorney for anyone other than himself or herself;
There are also restrictions on the type of work a Foreign Legal Consultant may do, mainly relating to property, probate and family law.
The State Bar of California may issue a license to practice as an Foreign Legal Consultant to lawyers who: are a member in good standing of a recognised legal profession in a foreign country; who are admitted to practice as an attorney or equivalent and subject to effective regulation and discipline by a duly constituted professional body or public authority; who have been engaged in the practice of law for at least four of the six years immediately preceding the application.
Applicants must supply proof of admission to practice in their home country and evidence of educational and professional qualifications. The 2003 California Rules of Court set out the rules for Foreign Legal Consultants under Rule 988.

8. New York
There are over 147,000 resident and active lawyers in the State of New York. It is required to pass the Multistate Professional Responsibility Examination (MPRE), and a character and fitness investigation to qualify as an attorney in New York. The New York State Board of Law Examiners administers the bar exam. It is open to graduates of US and foreign law schools, although rules vary depending on whether the law school is an ABA-approved US law school, a non-ABA approved US law school or a foreign law school (see below for special provisions relating to graduates of foreign law schools).
Section 520 of the Rules of Courts of Appeals outlines the eligibility rules for candidates to sit the New York State bar examination.
Lawyers with foreign law degrees may qualify to take the bar examination under the rules outlined in section 520.6 of the Rules of the Court of Appeals for the Admission of Attorneys and Counselors at Law.
New York requires that candidates who have received their legal education outside of the USA demonstrate that their legal education is the qualitative and quantative equivalent of the legal education requirements to those who have received their legal education in the USA.
If a candidate has qualified as a lawyer in an English common law jurisdiction the programme of study must be the quantative equivalent of legal education at an ABA-approved law school. If not, applicants must complete a programme of a minimum 20 credit hours at an ABA-approved law school.
Solicitors qualified in England and Wales must have 3 years’ formal education in order to sit the New York State bar examination. Solicitors who have qualified via the Common Professional Examination (CPE) route are not recognised as having an adequate legal qualification in order to sit the bar examination. These candidates must complete an additional 20 hours of study.
Candidates must provide proof of admission to practice in the jurisdiction in which they are qualified, or if not admitted, proof that they have successfully completed the educational requirements needed to practice in that jurisdiction. For applicants from England and Wales, this means proof of their law degree, Legal Practice Course (LPC) and completed training contract.
A Foreign Legal Consultant license allows lawyers qualified in a non-US jurisdiction to provide legal services in the State of New York on their home country law or the laws of other jurisdictions in which they are qualified.
Foreign Legal Consultants are subject to certain restrictions: they cannot provide legal advice on the law of the State of New York nor on the laws of the USA; they cannot appear in court as an attorney for anyone other than himself or herself; they cannot hold themselves out as a member of the New York State Bar.
There are also restrictions on the type of work a Foreign Legal Consultant may do; mainly relating to property, probate and family law.
The Supreme Court may issue a license to practice as a Foreign Legal Consultant to lawyers who: are a member in good standing of a recognised legal profession in a foreign country; who are admitted to practice as an attorney or equivalent and subject to effective regulation and discipline by a duly constituted professional body or public authority; who have been engaged in a practice of law for at least three of the five years immediately preceding the application.
Applicants must intend to ptactice as a legal consultant in the State of New York and maintain an office for this purpose. They must supply proof of admission to practice in their home country and evidence of educational and professional qualifications.
Part 521 of the Rules of the Court of Appeals for the Admission of Attorneys and Counselors at Law covers the rules regarding Foreign Legal Consultants.

9. Texas
There are approximately 70,000 practicing lawyers in Texas. The State Bar of Texas regulates the profession .One needs to complete Texas bar exam conducted by Texas Board of Law Examiners to qualify as an attorney in Texas and enroll before Texas bar council. The State Bar requires that every attorney completes fifteen hours of continuing legal education each year to maintain an active law license.
Foreign lawyers must demonstrate that the legal education that they have received is the substantial equivalent of the education provided by an ABA-approved law school. Applicants must submit proof of their educational qualifications to a professional credential evaluation service.
Foreign legal consultants:
An alternative route for foreign lawyers to practice in Texas is available via a Foreign Legal Consultant license which permits foreign lawyers restricted legal practice within the State on the basis of their home country qualifications and experience.
Foreign Legal Consultants are subject to certain restrictions: they cannot provide legal advice on the law of the State of Texas nor on the laws of the USA; they cannot appear in court as an attorney for anyone other than himself or herself; they cannot hold himself or herself out as a licensed Texas attorney.
There are also restrictions on the type of work a Foreign Legal Consultant may do, mainly relating to property, probate and family law, and on the name or title of his or her practice.
The Supreme Court may issue a license to practice as an Foreign Legal Consultant to lawyers who: are a member in good standing of a recognized legal profession in a foreign country; who are admitted to practice as an attorney or equivalent and subject to effective regulation and discipline by a duly constituted professional body or public authority; who have been engaged in the practice of law for at least three of the five years immediately preceding the application; possesses the good moral character and general fitness requisite for a member of the Texas Bar; is at least twenty-six (26) years of age; who intends to practice as a legal consultant in the State of Texas and maintain an office for this purpose .

10. Australia
There are approximately 45,000 solicitors and 5,000 barristers in Australia. The Law Council of Australia, governs the legal profession in Australia.
English law degrees are generally recognized in Australia, but further re-qualification may be required depending on individual state’s own rules .
Requirement for foreign practitioner registration in Australia/“fly-in, fly-out” rights of foreign lawyers:
The Model imposes a general prohibition on the practice of foreign law in Australia unless the practitioner is an Australian-registered foreign lawyer or an Australian legal practitioner.
However, an overseas-registered foreign lawyer will not be subject to the general prohibition on practicing foreign law in Australia provided the lawyer:
1. practises foreign law in Australia for one or more periods that do not in aggregate exceed 90 days in any period of 12 months, or is subject to a restriction under the Migration Act 1958 of the Commonwealth of Australia that has the effect of limiting the period during which work may be done, or business transacted, in Australia, and
2. Does not maintain a legal office for the purpose of practicing foreign law or does not become a partner or
3. director of a law practice in Australia.

Granting of registration to foreign lawyers
Registration is granted by the relevant state or territory authority and may include conditions or restrictions as deemed appropriate. Under the Model legislation, in order to become an Australian-registered foreign lawyer:
1. the foreign lawyer must be entitled to practise law in a foreign jurisdiction, in that the lawyer is properly registered to engage in legal practice in (that) foreign country by the foreign registration authority for the country;
2. the jurisdiction in question must have an effective system of regulating the practice of law; and
3. the lawyer must be a fit and proper person to be registered as an Australian-registered foreign lawyer.
Permissible scope of practice (including employment issues) of an Australian-registered foreign lawyer:
There are limitations on the scope of practice by an Australian-registered foreign lawyer.
The permissible services are:
1.doing work, or transacting business, concerning the law of a foreign country where the lawyer is registered by the foreign registration authority for the country;
2.legal services (including appearances) in relation to arbitration proceedings of a kind prescribed under the regulations;
3.legal services (including appearances) in relation to proceedings before bodies other than courts, being proceedings in which the body concerned is not required to apply the rules of evidence and in which knowledge of the foreign law of the country in which the foreign lawyer is registered is essential; and legal services for conciliation, mediation and other forms of consensual dispute resolution of a kind prescribed under the regulations.
The Model legislation prohibits an Australian-registered foreign lawyer from appearing in any court (except on his or her own behalf) and from practicing Australian law in Australia except when the lawyer is advising on the effect of an Australian law where the giving of such advice is “necessarily incidental to the practice of foreign law” and the “advice is expressly based on advice given on the Australian law by an Australian legal practitioner who is not an employee of the foreign lawyer”.
4.An Australian-registered foreign lawyer is permitted to employ one or more Australian legal practitioners but such employment does not allow the foreign lawyer to practice Australian law in Australia. In addition, the Australian legal practitioners so employed (unless employed in a law firm with an Australian-registered foreign lawyer as a partner with at least one other partner an Australian legal practitioner) must not provide advice on Australian law to, or for use by, the foreign lawyer or practice Australian law in Australia in the course of that employment.
Form of practice of an Australian-registered foreign lawyer:
In general terms, an Australian-registered foreign lawyer may engage in the practice of foreign law in the following ways (subject to any conditions imposed on his or her registration):
1. on his or her own account;
2. in partnership with one or more Australian-registered foreign lawyers and/or one or more Australian legal practitioners;
3. as a director or employee of an incorporated legal practice or as a partner or an employee of a multidisciplinary
4. partnership (provided legal practice in that form is permitted by the relevant state or territory);
5. as an employee of an Australian legal practitioner or law firm; or
6. as an employee of an Australian-registered foreign lawyer.
Applying for registration
An overseas-registered foreign lawyer is eligible to apply to the “domestic registration authority” for the grant or renewal of registration as a foreign lawyer. An application must be made in the approved form and accompanied by the required fees (which are not to be set so as to be greater than the maximum fees for a practising certificate in the relevant Australian jurisdiction). An applicant may also be required to meet any reasonable costs, for example, costs associated with making inquiries into the applicant’s qualifications, incurred by the domestic registration authority.
Various matters are to be included in an application for registration, for example:
1. details of the applicant’s educational and professional qualifications;
2. A statement that the applicant is registered to engage in legal practice by one or more specified foreign
3. registration authorities in one or more foreign countries;
4. A statement that the applicant, in his or her capacity as a lawyer, is not the subject of disciplinary
5. Proceedings in Australia or in a foreign country, including any preliminary investigations that might lead to disciplinary proceedings;
5. a statement whether the applicant has been convicted of an offence, in which case an applicant is required to provide certain details about that matter.
Various matters are to be included in an application for registration, for example:
1.details of the applicant’s educational and professional qualifications;
2. a statement that the applicant is registered to engage in legal practice by one or more specified foreign
3. registration authorities in one or more foreign countries ;

11. China
There about 130,000 lawyers who work in around 11,000 domestic law firms in China. China’s lawyers are represented and regulated by the All China Lawyers Association (ACLA) which was founded in 1986.
Foreign law firms have been permitted to maintain representative offices in the People’s Republic of China (PRC) since 1992, and recent figures from the Ministry of Justice indicate that 114 firms have chosen to do so. Foreign law firms can establish multiple representative offices in the PRC and a number of firms now have more than one representative office although there are certain restrictions attached to this as outlined below.
China’s foreign law firm regulations, set out by its State Council, outline the services that foreign law firms can legitimately provide in China. Foreign law firms are permitted to advise clients on the law of the firm’s jurisdiction and on international conventions and practices. Second, they can advise clients on the implications of the Chinese legal environment. Third, they are permitted to form long-term co-operation agreements with Chinese law firms.
Foreign law firms must engage Chinese firms to advise on PRC law and cannot employ PRC lawyers, unless they give up their PRC practicing certificate. Foreign firms cannot form joint ventures with local PRC law firms. Those foreign lawyers working in China must register annually; and approval of licenses can be a lengthy and bureaucratic process.
In terms of opening up additional representative offices, a foreign firm can only do so when its “most recently established representative office has been engaged in practice for three consecutive years.”
UK Lawyers are not able to qualify as Chinese lawyers and the Chinese lawyers are not permitted to sit the Qualified Lawyers Transfer test in England and Wales
In December 2001, China acceded to the WTO and made a number of commitments on the further liberalization of legal services .

12. Hong Kong
The legal profession is made up of solicitors, regulated by the Law Society of Hong Kong, and barristers, regulated by Hong Kong’s Bar Association. As in the UK, solicitors enjoy limited rights of audience in the Hong Kong courts. Hong Kong’s higher courts are: the High Court; the Court of Final Appeal.
There are currently over 5,000 practicing solicitors and more than 650 firms in Hong Kong. In 2007 there were 49 foreign law firms – 22 of them British and 906 foreign lawyers.
Certain restrictions still apply to foreign lawyers and firms:
1. Foreign lawyers cannot employ or enter into partnerships with Hong Kong solicitors to practise Hong Kong law.
2. A registered foreign firm may enter into an association with a local firm, sharing premises, facilities and personnel, provided that the ratio of foreign lawyers to local lawyers does not exceed 1:1
3. Foreign lawyers and foreign law firms may practise the law of their home jurisdictions or that of a third country, and are subject to the Foreign Lawyers Practice Rules.
4. Anyone offering their services to the public as a practitioner of foreign law, other than a solicitor or barrister, must register with the Law Society of Hong Kong as a foreign lawyer.
To qualify for registration with the Law Society of Hong Kong, foreign lawyer must:
1. be a person of good standing in the jurisdiction in which they qualified
2. must be a fit and proper person;
3. A foreign law firm must be of good standing and must have substantial experience.
Under the Law Society of England & Wales Qualified Lawyers Transfer Regulations, Hong Kong lawyers are still entitled to automatic admission as solicitors in England and Wales on the basis of their Hong Kong qualifications. However, UK lawyers must sit the Qualified Lawyers Qualification Examination (QLQE) to requalify as a Hong Kong solicitor.

13. India
There about One million (1000000) in India. Bar council of India and state bar council rules, regulates the lawyers in the country. A lawyer enrolled in one state is allowed to practice in that state and before the Supreme Court. However, he is not allowed to practice in other state unless he makes an application to the Bar Council of India requesting for transfer of his name from the roll of state bar council where he is enrolled to other bar council within 6 months of his practice in other state.
Although foreign law firms were allowed set up liason office in India, foreign lawyers are not allowed to practice in Indian Courts. Foreign law firms in India today can offer consultancy services to its clients. There are many foreign law firms in India today .
Requalification as an Indian Advocate
It is possible for a foreign lawyer to seek admission as an Indian advocate under the following conditions:
1. if citizens of India, duly qualified, are permitted to practise law on a reciprocal basis in his/her country of nationality;
2. if he/she has a degree from a University recognised by the Bar Council of India
3. if he/she is over 21 years of age;
4. if he/she fulfils any other conditions as laid down under the rules made by the relevant State Bar Council under the provisions of the Advocates Act.

14. Japan
In 2007 there were 23,133 Japanese lawyers (known as Bengoshi) and 230 law corporations in Japan. One needs to pass the competitive national bar exam and candidates must complete an eighteen-month training period organised by the Legal Training and Research Institute (LTRI)to become lawyer in Japan.
Japan liberalised its system in 1995, by allowing local joint enterprises between Japanese and resident foreign lawyers. The ‘joint enterprise’ arrangement proved unsatisfactory because it denied Japanese bengoshi membership of a major international law firm, whether as a partner or associate. The joint enterprise did not give bengoshi the benefits that full membership of a firm would have brought, in respect of status, remuneration, training, resources and career prospects. Clients could still not obtain the advice they required from a single firm capable of advising them on all aspects of the same transaction. It resulted in three separate organisations (the Japanese partnership, the foreign partnership and the joint enterprise) instead of what would otherwise be a single organisation multi-national partnership.
Since 2005 Japanese and registered foreign lawyers have been able to provide legal services through a single law firm, and foreign law firms have been allowed to employ Japanese lawyers.
Lawyers from foreign countries may be eligible to become foreign special members (Gaikokuho-Jimu-Bengoshi) of the JFBA and advise on the law of the country in which they qualified.
Foreign special members may not practice law within a prescribe rang, such as representation in proceedings at courts, public prosecutor’s offices or other governmental agencies or appraisal relating to a law other than the law of the country of primary qualification.
With permission foreign special members may also practise law relating to other countries. In cases involving international arbitration, a foreign special member may represent a client regardless of the case’s governing law.
To qualify as foreign special member an applicant must:
1.be a qualified lawyer
2.have three or more years post-qualification experience (up to one year’s experience in Japan working for a Japanese lawyer or a registered foreign special member may be credited towards this) not have been disbarred under the laws of their home country or Japan within the previous three years
3.be personally committed and legally and financially able to practise in Japan
4.be able to compensate clients for any damages caused through malpractice
Lawyers from any jurisdiction may sit the bar exam and qualify as a lawyer. However Japanese citizenship is required to serve as a judge or prosecutor.

15. Korea
With about 5,000 members, the Korean Bar Association (KBA) is the main regulatory body for lawyers in Korea. It also represents 14 local bar associations. Membership of the KBA is compulsory for all practicing lawyers.
Under the Korean Attorney-At-Law Act, a foreigner must pass the Korean Bar examination in order to practise as a lawyer in Korea. There is no knowledge of any foreigner actually achieving this.

In order to become a lawyer in Korea, a candidate must pass the Judicial Examination and complete a 2-year training course at the Judicial Research and Training Institute. After finishing the course, the candidate may be appointed as a judge or a prosecutor, or practice law as a private attorney. At the beginning of 2000 the total number of judges was 1,508, there were 1,134 prosecutors but only 3,800 private practitioners. In the last five years this number has nearly doubled to 6,600, however, the underdeveloped legal sector is still seen as a drag on the economy.
Over the past few years, Korea has begun to pursue widespread reform across its criminal and civil justice system. These reforms have had a direct impact on the profile of the legal profession. First, Korea has taken steps to increase the number of its lawyers. Tough bar exams had until recently restricted the supply of new lawyers to around 300 a year, making both firms and lawyers more generalist than specialist. However, under recent changes, 1000 new lawyers are being qualified each year. This has caused some short term problems since there are not enough law firms to provide employment to the new lawyers coming on the market.
Second, expanding the number of Korean lawyers has not addressed the shortage of international legal practice skills that Korea faces. Korea is the 11th or 12th largest economy in the world but has only around 10 firms doing most of the international legal work. Korea is now beginning to tackle this problem by undertaking a limited opening of its legal market.
Foreign law firms are at present not allowed to establish in Korea, nor are foreign lawyers allowed to practise law in Korea. Although, a number of individual foreign lawyers have been widely employed as foreign legal consultants by Korean law firms for over 20 years, they are not permitted to operate independently yet, nor are they subject to any formal registration or enrolment system. The EU Chamber of Commerce estimates that foreign lawyers often fly in to consult with their clients but since they are usually based either in Hong Kong or Singapore, this all adds to the general expense of legal services in Korea.

16. Belgium
The Belgian legal system is based on the civil law tradition.Due to the linguistic division in Belgium, lawyers are either Avocat (French), Advocaat (Flemish) or Rechtsanwalt(German). There are over 6,000 lawyers registered with the French- and German-speaking Bar Association and over 8,400 registered with the Flemish-speaking Bar Association.
There are two federal bars in Belgium : the Ordre des barreaux francophones et germanophones (O.B.F.G.- French- and German-speaking Federal Bar) and the Orde van Vlaamse Balies (O.V.B. – Flemish speaking Federal).
Regulation lies with the local bar association in one of the 27 judicial districts. The bilingual judicial district of Brussels has two bar associations, one Flemish-speaking and one French-speaking.
Belgium implemented the Establishment Directive 98/5/EC. Establishment is permitted for EU, EEA and Swiss nationals who are qualified in these countries. It allows them to give advice in international law, the law of their home country as well as Belgian law. Registration under this directive is with the local bar associations for French and German-speaking and for Flemish-speaking (click on “Lokale Balies”).
Legal services by EU, EEA and Swiss qualified lawyers can also be provided cross-border on a temporary basis under the provisions of the Lawyers Services Directive 77/249/EEC. Contrary to the Establishment Directive, there are no conditions of nationality under the Lawyers Services Directive.
Solicitors of England and Wales (and other EU, EEA and Swiss qualified lawyers) seeking to requalify in Belgium can do so in two ways:
1.Through Art. 10 of the Establishment Directive 98/5/EC, under conditions of nationality and after three years of regular and effective practice of French law in France . Applicants need to contact their local bar of registration;
2.Through the Diplomas Directive 89/48/EEC, now incorporated into the Recognition of Professional Qualifications Directive 2005/36/EC, by sitting the relevant equivalence examination administered by the OBFG or the OVB .

17. France
The French legal system is based on the civil law tradition. France has a monist civil code legal tradition with a Latin notarial system. This system was principally introduced under Napoleon following the French Revolution and it superimposed French canonical customary law that had, at heart, the principle of the absolute sovereign.
France is ruled by a strict hierarchy of norms. Highest is the Constitution, followed by parliamentary statutes (les Lois) that also include a sub-hierarchy: institutional act (loi organique), ordinary act (loi ordinaire) and then ordinance (ordonnance).
The executive power has right to enact regulations (règlements) which are called décrets (for Prime Minister and President of the Republic) and arrêtés (for the rest of the executive branch).
It is internationally renowned for having produced the Napoleonic Code Civil which spread to other parts of Europe and the world.
The French profession of avocat stood at over 47,000 on 1 January 2007. Almost half of the profession practise in the Paris region.
Notaires (civil law notaries) play an important role to play in the French legal system for conveyancing, probate and related family matters. They numbered 8,595 on 1 July 2007.
Regulation lies with the 181 Barreaux (local bar associations). Registration is mandatory to be able to practice
The Paris Bar, with over 17,000 avocats, is by far the most influent ial bar association of all French bars . The 180 provincial bars have organised themselves into the representative Conférence des Bâtonniers to exert some influence on the evolution of the profession.
The Conseil National des Barreaux, created in 1990, is the overarching national body for all French bars and deals with the following functions:
1. representation of the profession of avocat in France and abroad;
2. harmonisation of rules and regulations for the profession of avocat;
3. professional training for avocats;
4. access/requalification to the profession of French avocat for foreign lawyers.
France implemented the Establishment Directive 98/5/EC. Establishment is permitted for EU, EEA and Swiss nationals who are qualified in these countries. It allows them to give advice in international law, the law of their home country as well as French law. Registration under this directive is with the local Barreau.
Legal services by EU, EEA and Swiss qualified lawyers can also be provided cross-border on a temporary basis under the provisions of the Lawyers Services Directive 77/249/EEC. Contrary to the Establishment Directive, there are no conditions of nationality under the Lawyers Services Directive .

18. Germany
The German legal system is based on the Romano-Germanic Civil Law tradition.
The German profession of Rechtsanwalt (lawyer) stood at 142,830 on 1 January 2007.
The German profession of Steuerberater (tax adviser) has also been approved by the Solicitors Regulation Authority (SRA) for the purpose of Multi National Partnerships (MNPs).
Approximately 9,500 lawyers practise as Notar (Civil law notary) in Germany. German law requires their intervention in many business and commercial transactions, as well as in probate, conveyancing and some family matters.
The BRAK (Bundesrechtsanwaltskammer) is the federal regulatory organisation for the profession of Rechtsanwalt. Regulation actually lies with the 27 regional Rechtsanwaltskammern and the one attached to the Bundesgerichthof (Federal Court of Justice) in Karlsruhe. Membership is compulsory.
In addition to the regulatory bodies, the DAV (Deutscher Anwaltverein) is the representative body for its 66,000 Rechtsanwälte members. It has branches throughout Germany as well as in France, Italy and the United Kingdom.
Germany implemented the Establishment Directive 98/5/EC. Establishment is permitted for EU, EEA and Swiss nationals who are qualified in these countries. It allows them to give advice in international law, the law of their home country as well as German law. Registration under this directive is with the local Rechtanwaltskammer.
Non-EU/EEA/Swiss nationals who are however qualified in the EU/EEA or Switzerland can establish in Germany but are restricted to give advice only in international law and the law of their home country.
Legal services by EU, EEA and Swiss qualified lawyers can also be provided cross-border on a temporary basis under the provisions of the Lawyers Services Directive 77/249/EEC. Contrary to the Establishment Directive, there are no conditions of nationality under the Lawyers Services Directive.
Under Section 206 of the Legal Profession Act (Bundesrechtsanwaltsordnung – BRAO), the Federal Ministry of Justice has approved the following foreign professions as being equivalent to the German’s lawyer profession and therefore entitled to the right of establishment in Germany to give advice in international law and the law of their home country:Argentina (Abogado),Australia (Barrister, Solicitor, Legal Practitioner),Bolivia (Abogado),Brazil (Advogado),Cameroon (Avocat/Advocate),Canada (Barrister, Solicitor),Croatia (Odvjetnik),India (Advocate),Israel (Orech-Din),Japan (Bengoshi),Mexico (Abogado),Namibia (Legal Practitioner/Advocate/Attorney),New Zealand (Barrister, Solicitor),Russian Federation (Advokat),South Africa (Attorney/Prokureur, Advocate/Advokaat),Turkey (Avukat),USA (Attorney-at-Law),Venezuela (Abogado) .

19. Poland
As on 2006, ther are 22,545 Legal Advisers (Radca Prawny)and 8,990 Adwokat in
Adwokat have a monopoly on representation in criminal matters although they work in all practice areas. The legal advisers work in all practice areas but criminal and can also work in-house. Members of both professions can go into partnership with one another.
The profession of Legal Advisers is regulated by the National Council of Legal Advisers (Krajowa Izba Radców Prawnych – KIRP) at the national level and by 19 local Councils at the local level. The profession of Adwokat is regulated by the Polish Bar Council (Naczelna Rada Adwokacka) at the national level and 24 local bar associations at the local level.
Poland implemented the Establishment Directive 98/5/EC. Registration under this directive is with the local bar or council (see above links). European lawyers may choose between the two professional bodies but then become bound by the code of ethics of the body of their choice .

20. Russia
The Russian legal system is based on the Civil Law tradition. Russian lawyers who are called as advocates (Адвокаты), are governed by advocacy act 2002.
Foreign lawyers can practice in Russia and can provide advice on international law and their home law. Foreign practices must register as firms with the Ministry of Justice.
The Russian profession of advocate has been approved by the SRA for the purposes of Multi-National Partnerships (MNPs).

21. Spain
As on 2006 there were 116,394 practicing lawyers in Spain. Local bar associations (Colegios de Abogados ) governs the lawyers in Spain. Only the lawyers registered before these Associations are allowed to practice in the country. There are some relaxations for EU member country.
Spain implemented the Establishment Directive 98/5/EC. Establishment is permitted for EU, EEA and Swiss nationals who are qualified in these countries. It allows them to give advice in international law, the law of their home country as well as Spanish law. Registration under this directive is with the local Colegio.

Globalization of Law firms:
Law firm is an group/organization or business entity formed by one or more lawyers for the purpose of providing legal service and practice to the clients who are need of assistance in civil or criminal cases. Most of the law firms today organized as partnership firms where the partners are joint owners and business directors of the legal operation.
The world’s oldest continuing partnership is that of Cadwalader, Wickersham & Taft, founded in 1792 in New York City . According to Alton B.Parker, Marshau and Son is the world’s oldest law firm .
In response to the globalization of business law and in order to serve giant, transnational companies, law firms are globalizing their practice. The biggest firms are merging across borders, creating mega practices with several thousand professionals in dozens of countries.
Today, most of the International law firms operate in more than 40 countries including Abu Dhabi , Argentina, Australia, Austria, Aberjian, Bahrain, Belgium, brazil, Canada, chili, china, Columbia, Chez Republic, Egypt, England, France, Germany, India, Hungary, Indonesia, Italy, Japan, Kazakhstan, Malaysia, Mexico, Netherlands, Philippines, Poland, Russia, Saudi Arabia, Singapore, Spain ,Sweden, Switzerland, Taiwan, Thailand, Ukraine, USA, Vietnam, Venezuela. All these possible as the countries were member to the WTO and liberalized their legal services.
Most of the international law firms today hire the legal talent from the country where it has got office as the partners, associates and lawyers. There are also lawyers eligible to practice in 2-3 countries. For example: US lawyer may have license to practice in UK, Australia, and South Africa. All it depends on the eligibility to practice law and enrollment before such bar councils and societies.
Most of the International Law firms receives more than 50% of revenue from the corporate side. International Law Firms Practice areas mainly includes corporate, M&A, Securitization, IPR, Infrastructure, loans and credits, securities, commercial litigation, agreements, contracts, and real estate.

Globalization and LPO (legal process outsourcing):
India, South Africa, Sri Lanka, Singapore, and Malaysia are the major Legal Process Outsourcing destinations in the world. Almost 80% of LPO services are outsourced to India. Outsourcing Legal work to India began in 1995, when the US based Bickel and Brewer opened its office, Imaging & Abstract International (captive LPO and Subsidiary of Bickel and Brewer LLC) in Hyderabad. I & A International dealt with digitalization of the legal documents and creating searchable databases such as to scan, abstract and index documents. Later on, the firm hired lawyers to review documents produced in lawsuits. In 2001, GE was the first company to offshore its in-house legal work in India. Since then a lot of companies have entered the arena in one form or other.
Allen & Overy (UK) and Hammonds (UK) both began outsourcing word processing and document production to India in 2003. Milbank Tweed Hadley & McCloy of the US is outsourcing work in India.
Outsourcing is not a new phenomenon. Driven by the competition and the temptation of cheaper labor, the industry took off in the late 1980’s with the rise of outsourcing manufacturing jobs abroad. After the rapid increase in telecommunication, Internet and information technology, outsourcing of white-collar jobs started to take place.
Although LPO providers cannot advise on US and UK law, they can provide assistance to the US attorneys and UK solicitors in Legal Research, E-Discovery, Contract Review, and Litigation support services.
LPO’s also have contributed to the idea of Globalization of the Legal Industry.

Source:

http://acronyms.thefreedictionary.com/Globalization

http://dictionary.cambridge.org/define.asp?key=33185&dict=CALD

http://financial-dictionary.thefreedictionary.com/globalization

https://www.imf.org/external/np/exr/glossary/showTerm.asp#91

http://en.wikipedia.org/wiki/Globalization

http://definitions.uslegal.com/g/globalization/

http://encyclopedia2.thefreedictionary.com/globalization

http://www.articlesbase.com/international-business-articles/the-dutch-east-india-company-was-the-worlds-first-multinational-corporation-1278429.html

http://www.experiencefestival.com/a/Dutch_East_India_Company/id/2024886

http://en.wikipedia.org/wiki/Dutch_East_India_Company

http://www.exchange-handbook.co.uk/index.cfm?section=articles&action=detail&id=60613

http://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm

http://www.wto.org/english/thewto_e/whatis_e/tif_e/fact1_e.htm

http://en.wikipedia.org/wiki/History_of_the_legal_profession

http://www.encyclopedia.com/doc/1O245-legalprofession.html

http://www.qltt.com

http://www.fleindia.com
http://www.qltt.in

http://www.collaw.edu.au/Future-Students/Lawyers-Crossing-Borders/Qualified-Lawyers-Transfer-Test/QLTT-Eligibilty/

http://www.lawsociety.org.uk/becomingasolicitor/outsideengandwales/transfertest.law

http://www.sra.org.uk/solicitors/qltt.page

http://www.qltt.co.uk/

http://www.qltt.com/international-english-solicitor/index.htm

http://international.lawsociety.org.uk/ip/asia/596/practise

http://www.sra.org.uk/sra/regulatory-framework/3024.article)

http://www.qltt.com/what_overview.htm

http://www.agc.gov.sg/lps/index.html

http://www.lawinfo.org.za/courts/legal_system.asp

http://www.ialsnet.org/meetings/business/HagenmeierCornelius-SouthAfrica.pdf

http://international.lawsociety.org.uk/ip/africa/568/practise

http://www.info.gov.za/bills/2000/draftlpb.htm

http://international.lawsociety.org.uk/ip/africa/1014/practise

http://www.omanet.om/english/oman2000/sec5/1.asp

http://international.lawsociety.org.uk/ip/africa/1018/practise

http://international.lawsociety.org.uk/ip/americas/612

http://www.calbar.ca.gov/state/calbar/calbar_generic.jsp?cid=10163

http://www.calbar.ca.gov/state/calbar/calbar_generic.jsp?cid=10163&id=1304

http://international.lawsociety.org.uk/ip/americas/616/practise

http://international.lawsociety.org.uk/ip/americas/612/practise

Follow this link for rules http://www.law.northwestern.edu/career/llm/documents/NY_FLC_rules.pdf

http://www.ble.state.tx.us/

http://www.texasbar.com/Template.cfm?Section=Home&Template=/ContentManagement/ContentDisplay.cfm&ContentID=14051

http://www.texasbar.com/Template.cfm?Section=Pro_Bono_and_Community_Service&Template=/ContentManagement/ContentDisplay.cfm&ContentID=9163

http://international.lawsociety.org.uk/ip/americas/618/practise

http://international.lawsociety.org.uk/ip/asia/1073/practise

http://www.actlawsociety.asn.au/

http://www.lawcouncil.asn.au/shadomx/apps/fms/fmsdownload.cfm?file_uuid=314C0D0B-1C23-CACD-2253-F19A22E78A87&siteName=lca (Foreign lawyers and the practise of foreign law in
Australia)

http://www.lawcouncil.asn.au/information/foreign-lawyers/foreign-lawyers_home.cfm

http://international.lawsociety.org.uk/ip/americas/618/practise

http://www.barcouncilofindia.org

http://international.lawsociety.org.uk/ip/asia/590/practise

http://international.lawsociety.org.uk/ip/asia/592/practise

http://international.lawsociety.org.uk/ip/asia/594/practise

http://international.lawsociety.org.uk/ip/europe/570/practise

http://international.lawsociety.org.uk/ip/europe/572/practise

http://international.lawsociety.org.uk/ip/europe/574/practise

http://international.lawsociety.org.uk/ip/europe/576/practise

http://international.lawsociety.org.uk/ip/europe/578/practise

http://international.lawsociety.org.uk/ip/europe/580/practise

http://en.wikipedia.org/wiki/Law_firm

http://query.nytimes.com/mem/archive-free/pdf?_r=1&res=9A0DE0D7133EE233A25756C2A96F9C946997D6CF

http://query.nytimes.com/gst/abstract.html?res=9A0DE0D7133EE233A25756C2A96F9C946997D6CF

Posted by: sadanandnaik | November 2, 2009

Comma can cost millions of dollars

, = $$$$$$$

Introduction:

The word comma comes directly from the Greek komma, which means something cut off or a short clause[i].

The history of Comma dates back to 3rd century BC, when Aristophanes of Byzantium invented a system of single dots which separated verses (colometry) and indicated the amount of breath needed to complete each fragment of text when reading aloud. The different lengths were signified by a dot at the bottom, middle, or top of the line. For a short passage (a komma), a media distinctio dot was placed mid-level ( · ). This is the origin of the concept of a comma, though the name came to be used for the mark itself instead of the clause it separated. In the 16th century, the virgule dropped to the bottom of the line and curved, turning into the shape used today ( , )[ii].

Jokingly it is said that the difference between the cat and comma is ‘If one has the paws before the claws and the other has the clause before the pause’[iii].

Importance of Comma:

English is not a math or chemistry; you cannot learn the language by learning the rules that govern its use and then applying them[iv].

English is a West Germanic language that developed in England during the Anglo-Saxon era. English has got the status of official language in the 53 countries. English language has got a 309–400 million speakers all over the world. India is the 2nd largest English-speaking country next to USA[v]

The English language is constantly growing and changing and adapting to the ideas and peoples who choose to speak and write in the language. English speakers readily adopt words from other languages.

Comma plays an important role in the writing. Misplacement of comma can cause you, your company, or a client loss in millions of dollars, it may cause loss of job, and it may make you to lose your friend. Comma holds the power to change the meaning of a sentence and to disrupt the flow of prose.

The misconception about the ‘Comma’ is that the only reason we use commas is to signal the reader to pause. It is not always necessarily mean that. Commas are required for clarity.

Accuracy, brevity, and clarity are the main principles (The A, B, Cs) of legal writing. A lawyer needs to go through his writing carefully before it is delivered to parties or filed in the court. Although, at first glance, this would appear to be a minor detail, incorrect usage of punctuation marks can change the entire meaning of a clause or of a contract. LPO’s in India have to ensure these qualities in the writing before delivering it to the parties. Computer programs like Spell-check and grammar check would not be helpful all the times.

Comma can cost millions of dollars

The US government had to lose millions of dollars due to the misplacement of comma. In the tariff act passed on June 6, 1872, a list of duty-free items included was `Fruit plants, tropical and semitropical’. A government clerk accidentally altered the line to read: `Fruit, plants tropical and semitropical’. Importers successfully contended that the passage, as written, exempted all tropical and semitropical plants from duty fees[vi]..

IN Rogers Communications Vs. Aliant Telecom. Decision CRTC 2006-45,[vii]

The comma was the matter of dispute between Rogers Communications of Toronto, Canada’s largest cable television provider, and a telephone company in Atlantic Canada, Bell Aliant. In this the parties entered into a five year contract to allowing Rogers to use power cables poles crossing Canada for carrying their TV cables. Aliant was merely an agent for the power company who owned the poles. The contract contained the following clause:

“[…This Agreement] shall be effective from the date it is made and shall continue in force for a period of five (5) years from the date it is made, and thereafter for successive five (5) year terms, unless and until terminated by one year prior notice in writing by either party.”

And in French: “Sous réserve des dispositions relatives à la résiliation du présent contrat, ce dernier prend effet à la date de signature. Il demeure en vigueur pour une période de cinq (5) ans, à partir de la date de la signature et il est subséquemment renouvelé pour des périodes successives de cinq (5) années, à moins d’un préavis écrit de résiliation à l’autre partie un an avant l’expi-ration du contrat.”

Before the end of the five year period the power company decided to re-take control of the poles and to increase the rates for using them. As a consequence Aliant gave Rogers notice of termination of the contract.

Aliant argued that because the highlighted comma set off the second five-year term, the notice provision applied to both five-year terms—not just the second. The other side, Rogers Communications, Rogers argued that pole contracts run for five years and automatically renew for another five years, unless a telephone company cancels the agreement before the start of the final 12 months.

In the 2007 decision, the Canadian Radio-television and Telecommunications Commission CRTC held that the comma after the phrase, “five year terms” made the whole phrase, “and thereafter for successive five (5) year terms”, a parenthetical phrase which, looking solely at the grammatical structure of the clause, entitled Aliant to terminate the agreement on one year’s notice, regardless of the fact that the initial five year term had not expired.

Comma can save the life

Czarina Maria Fyodorovna once saved the life of a man by transposing a single comma in a warrant signed by her husband, Alexander III, which exiled a criminal to imprisonment and death in Siberia. On the bottom of the warrant the czar had written: `Pardon impossible, to be sent to Siberia.’ The czarina changed the punctuation so that her husband’s instructions read: `Pardon, impossible to be sent to Siberia.’ The man was set free[viii].

Comma can cost lives

In the trial of Sir Roger Casement for treason in 1916, Sir Roger Casement was an Irishman who had retired as an eminent civil servant in 1913 from the British Foreign Office. He had worked as a diplomatic consul in Africa and South America. Following his retirement he became involved in raising support for the Irish nationalist movement and firstly went to the USA. After the outbreak of WW1 he clandestinely went to Germany and spent many months trying to raise financial and military support for the Irish Home Rule movement and was eventually promised help by the German authorities. He also visited a number of Irish prisoners of war from the British army and attempted to persuade them to defect to the German cause. He returned to Ireland aboard a German submarine U 19 and landed on the west coast of Ireland where he was soon found in hiding. The intelligence activities of the British secret service had become aware of Casement’s plans.
He was accused of high treason under the Statute of Treasons 1351 and stood trial at the Old Bailey on 26 June 1916, exceptionally before a full court consisting of three judges and a jury. The Treason Act 1351 is still on the statute books and is one of the oldest pieces of English legislation. It is written in old Norman-French and the relevant part reads as follows:

“Si homme leve de guerre contre notre dit Seigneur le Roi en son Roialme ou soit aherdant as enemys notre seigneur le Roi en le Roialme donant a euz eid ou confort en son Roialme ou per aillours”

The English translation reads:

“If a man do levy war against our said Lord the King in his realm or be adherent to the enemies of our Lord the King in his realm giving to them aid and comfort in the realm or elsewhere”

Casements counsel had very little on which to defend Casement because of the overwhelming evidence of Casements activities in Germany. So the only real option he had was to try and persuade the Court that the Treason Act only applied to activities carried on British soil and that it did not apply to activities carried on outside the kingdom. Casement had only acted in Germany and not in the United Kingdom and if this argument had been accepted he would not have been guilty of Treason as charged.

However, the court rejected this argument and decided that a comma should be read in the text, although the text was written without punctuation, thus widening the meaning of the words “in the realm or elsewhere” to mean where acts were done and not just where the “King’s enemies” may be. After unsuccessful appeal s to the Court of Appeal and House of Lords, he was hanged on 3 August, 1916, giving rise to the epigram that he was “hanged by a comma”. Historically commas did not enter into English language usage until the 1500’s[ix].

Comma can legalize slavery

Misplaced comma may legalize the slavery. In past the Michigan discovered that its state constitution inadvertently legalized slavery. Section 8, Article 2, read: Neither slavery or involuntary servitude, unless for the punishment of a crime, shall ever be tolerated in this state. It may mean that the slavery will be tolerated for the punishment of a crime. Later the state decided to move the comma from after servitude and place it after slavery[x]

Comma can cost the job

In 1983, an industrial tribunal ruled that an unnecessary comma cost Nurse Angela Penfold, her job at a health career center in Bovey Tracey. Mrs.Penfold, wrote to health officials complaining that her senior nurse was making her life “hell”.

The letter read: “I have come to the opinion Mrs. Pepperell is out to make my life hell, so I give in my notice.” The comma made health authorities think she was resigning[xi].

Comma can make you lose your friend

Even misplacing a comma may make you to lose friends. Once a person wrote to his friend stating “I detest liars like you, I believe that honesty is the best policy’’. 
Actually, he was intended to state “I detest liars, like you, I believe that honesty is the best policy.” It was resulted in losing of a friendship.

 

Other Examples

Below are the few examples, which show misplacing a comma changes the meaning of sentence:

1. Woman, without her man, is nothing.

Woman, without her, man is nothing[xii].

2. In conducting annual self-assessment training, providers should seek help.

In conducting annual self-assessment, training providers should seek help.

3. The man dropped the bullet in his mouth.

The man dropped, the bullet in his mouth.

4. We order merchandise and sell the products.

We order, merchandise and sell the products.

5. When I sing well, ladies feel sick.

When I sing, well ladies feel sick.

6. You will be required to work twenty four-hour shifts.

You will be required to work twenty-four hour shifts.

You will be required to work twenty-four-hour shifts[xiii].

7. Her brief yet eloquent tribute appears in this months journal.

Her brief, yet eloquent tribute appears in this month’s journal.

Her brief, yet eloquent, tribute appears in this month’s journal.

8. Whats the latest dope? (dope equals information)

Whats the latest, dope? (, dope equals you, dummy)

9. The flag is red, white and blue.

The flag is red, white, and blue.

10.I dedicate this book to my parents, Ayn Rand and God.

I dedicate this book to my parents, Ayn Rand, and God.

(Omitting the final comma suggests that the last two items are a special pair (an appositive for parents)

11. We have several positions available: copywriter, ad executive, receptionist and typist.

(Omitting the final comma suggests that there are only 3 positions are available such as; copywriter, ad executive, receptionist and typist. Receptionist and typist is meant to be one person.)

 

 

 


References:

[i]                       http://www.uhh.hawaii.edu/academics/hohonu/writing.php?id=82

[ii] http://en.wikipedia.org/wiki/Comma

[iii] http://www.basicjokes.com/djoke.php?id=2385

[iv] http://www.uhh.hawaii.edu/academics/hohonu/writing.php?id=82

[v] http://en.wikipedia.org/wiki/List_of_countries_by_English-speaking_population

[vi] http://clipmarks.com/clipmark/A2E17AAC-4E28-4EA7-B1FC-D5064B155006/

[vii] http://www.crtc.gc.ca/eng/archive/2007/dt2007-75.htm

http://www.crtc.gc.ca/eng/archive/2008/dt2008-62.htm

http://www.nytimes.com/2006/10/25/business/worldbusiness/25comma.html?_r=1

[viii] http://clipmarks.com/clipmark/A2E17AAC-4E28-4EA7-B1FC-D5064B155006/

[ix] http://www.facebook.com/topic.php?uid=74280614587&topic=10817

http://groups.yahoo.com/group/euleta/message/513

(book by Lynne Truss on English punctuation – Eats, Shoots & Leaves, (2003) page 99)

[x] A Modern Guide to English Usage by Theodore M. Bernstein, 1965 p. 360).

http://www.uhh.hawaii.edu/academics/hohonu/writing.php?id=82

http://www.techdirt.com/profile.php?u=lostsailor

[xi]http://news.google.com/newspapers?nid=799&dat=19830225&id=FjkLAAAAIBAJ&sjid=QVIDAAAAIBAJ&pg=2366,5852849

[xii] http://www.routledge.com/textbooks/languageinuse/cbk-punctuation.asp

[xiii] http://www.future-perfect.co.uk/grammartips/grammar-tip-punctuation.asp

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