Sunday, August 16, 2009

Legal Aid Crisis - Is there a Free Lawyer in the House?

Providing legal assistance for those who truly cannot afford to hire an attorney has been taken for granted. We see the "public defenders" on TV, and hear about lawyers working, without financial compensation, for the good of the public - "pro bono".

Nationwide, legal aid programs are being ravaged by budget cuts, and in many states, due to the low interest rates. Massachusetts, like many other states, has a requirement that attorneys place clients money in a segregated account, often called an IOLTA account. If the funds will be held for any length of time, a separate interest bearing account is set up for the client's benefit. But money being held for a few days or even a week is put into the IOLTA account where the interest earned funds a large part of the legal aid programs.

Interest rates have fallen significantly to merely .5% from 5% in just 2 years. In Massachusetts for example, 2007 revenue from these accounts for legal aid was $31.8million. In 2008 it had dropped 50 $15.6 million, and as of July of this year, the interest earned was only $4.1 million - that is on track for a $7 million 2009. Couple this with the monetary cuts due to a drop in federal aid and less taxes being collected, and you have a system that can handle only a fraction of the cases it should. According to Lonnie Powers, the Executive Director of the Mass. Legal Assistance Corporation, there are and will continue to be battered women, people facing foreclosure, tenants being evicted, workers having wages withheld illegally, with NO LEGAL REPRESENTATION. Thoughout the Commonwealth there will be Thousands of people who would normally qualify for legal assistance, who will not! Even criminal cases are now lacking lawyers for defendants, so the cases take longer.

This financial problem is not unique to Mass. It's a nationwide problem and one that has no easy answers. There simply is not enough money to go around. It is like the perfect storm: lower interest rates being paid for deposits, federal money being cut due to the financial crisis, and the creation of probably 25% more work due to foreclosures, an increase in domestic violence caused by money worries, and tenants falling behind in rent with their landlords evicting them (rightfully in most cases but sometimes without following the right procedures).

In my small office alone, I could have an additional 100 foreclosure cases in a month or less if I could afford to work for free (keep in mind that small law offices are just like any other small business, with salaries, rent, insurances, and other expenses to pay).

Unfortunately, there appears to be no answer in the near future;. it is a sign of the times.

Author's Copyright, by Richard I. Isacoff, Esq, August 2009

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