The Benchers have approved a total annual fee for full-time, insured, practising lawyers of $3,939.72 for 2018. The practice fee will increase by $14.15 (.7%) to $2,139.72 and the insurance fee will increase by $50 (2.9%) to $1,800.00. The presentation to the Benchers on the 2018 fees and the associated budgets for each fund is available on the Law Society website in the September 29, 2017 Bencher meeting agenda materials.
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Practice fee
The Benchers have set the 2018 fees pursuant to the Legal Profession Act based on a thorough review of the Law Society’s finances by the Finance and Audit Committee. The Finance and Audit Committee met with senior management to review the proposed 2018 fees and budgets for the General Fund and the Lawyers Insurance Fund. The Finance and Audit Committee also reviewed the fee proposals from a number of organizations and programs supported by Law Society fees, including Courthouse Libraries BC, the Lawyers Assistance Program, The Advocate, the Federation of Law Societies of Canada, the Canadian Legal Information Institute, the Rural Education and Access to Lawyers (REAL) program and the delivery of pro bono and access to legal services. Based on these meetings and reviews, the Finance and Audit Committee made recommendations to the Benchers regarding the amounts from the practice fee that should be allocated to each of these organizations and programs. These recommendations were approved by the Benchers at their September 29, 2017 meeting.
The overall objective when setting the fees is to ensure that the operations are appropriately funded to enable the Law Society to efficiently and effectively fulfill its statutory mandate of protecting the public interest in the administration of justice.
Law Society operations
For the portion of the practice fee that funds the Law Society operations, the Benchers have approved an increase of $8.45 (0.5%) per lawyer. The focus of the 2018 General Fund budget, in addition to delivering the core regulatory programs and meeting the established Key Performance Measures, is supporting regulation and education to ensure that the Law Society remains an innovative and effective professional regulatory body.
General Fund operational expenses are projected to be $24.7 million, $925,000 (3.9%) over the 2017 budget. This year-over-year budget increase reflects market based staff salary adjustments, additional governance resources and additional staff resources to deal with increased demand and new programs. Staffing levels have been reviewed in detail and the budget provides for 5.5 additional staff positions to support new programs and the increased demands of existing programs. One position has also been funded through existing general fund funding. The Bencher Governance area includes the costs of the Bencher and committee meetings, including travel and meeting costs, which are required to govern the Law Society, as well as the costs of any new initiatives related to the Bencher Strategic Plan.
The 2018 budget includes funding for the delivery of three new programs for the public community, a Legal Aid Colloquium, a Truth and Reconciliation Symposium, and a Rule of Law lecture series.
To ensure a balanced budget, General Fund revenues are expected to be $24.7 million, $925,000 (3.9%) over the 2017 budget. The budgeted revenue is based on the approved practice fee and estimates of 12,080 full-time equivalent practicing members, 500 PLTC students, increased electronic filing revenues, and other revenues at similar levels to recent years. In addition, the PTLC student training fee will increase from $2,500 to $2,600, and the PLTC retake fee will increase from $3,900 to $4,000, effective May 1, 2018, to fund new exam software for the program. Examsoft will enable the creation of test banks to facilitate building balanced exams, introduce grading rubrics, and allow students to write exams electronically in a controlled environment.
Trust administration fee
The goal of the Trust Assurance program is to ensure that law firms comply with the rules regarding proper handling of clients’ trust funds and trust accounting records. This is achieved by conducting trust accounting compliance audits at law firms, reviewing annual trust reports, and providing member advice and resources. The compliance audit program ensures that all firms are audited at least once within a six year cycle.
For 2018, the trust administration fee (TAF) will remain unchanged at $15 per transaction. TAF revenue has been stable over the past three years, and TAF reserve levels will be monitored to ensure the program is funded and has appropriate reserve levels. In 2018, additional resources will be added including the reinstatement of a program coordinator position and two additional positions, a supervisor to design and implement data analytics and provide improvements to the audit program, and an auditor to ensure completion of the audits required in second cycle of the trust assurance program.
The Federation of Law Societies of Canada
The Federation of Law Societies of Canada fee will remain the same as the 2017 fee of $28.12 per lawyer. The Federation provides a national voice for provincial and territorial law societies on important national and international issues.
The Canadian Legal Information Institute
The Canadian Legal Information Institute (CanLII) fee will remain the same as the current 2017 fee of $39.24 per lawyer. CanLII is a not-for-profit organization initiated by the Federation of Law Societies of Canada. CanLII’s goal is to make primary sources of Canadian Law accessible for free on its website at www.canlii.org. All provincial and territorial law societies have committed to provide funding to CanLII.
Courthouse Libraries of B.C.
Courthouse Libraries of B.C. (CLBC) – CLBC provides lawyers and the public in BC with access to legal information, as well as training and support in finding and using legal information. Through its expanding digital collections, website content and training, and 30 physical locations, the library provides practice support for lawyers across the province; and for the public. The CLBC funding for 2018 will be set at $195 per lawyer, an increase of $10 over 2017. This will result in approximately $2.36 million in funding versus $2.18 million in 2017. These additional resources will be used to increase library opening hours in Kamloops, Nanaimo and New Westminster from part time to full time as well as to maintain and upgrade programs such as Clicklaw, Clicklaw Wikibooks and the Online Community Platform.
The Advocate
The Advocate subscription fee remains the same, at $27.50 per member. The Advocate publication is distributed bi-monthly to all BC lawyers.
Lawyer’s Assistance Program
The Lawyers Assistance Program (LAP) provides confidential outreach, education, support and referrals to lawyers and other members of British Columbia’s legal community. LAP has requested funding of $792,440 which is consistent with 2017 funding. This is estimated at $65.60 per lawyer.
Pro bono funding
The Law Foundation includes Law Society funding in its financial support to organizations, offering pro bono legal services to the public. As recommended by the Access to Legal Services Advisory Committee, the Law Society 2018 contribution to pro bono and access to legal services programs continues at $340,000. This is estimated at 28.15 per lawyer.
Rural Education and Access to Lawyers
The Rural Education and Access to Lawyers (REAL) initiative is funded by the Law Society and the Law Foundation, with in-kind support from the Canadian Bar Association, BC Branch. The REAL initiative is a set of programs to address current and future projected shortages of legal services in small communities and rural areas of the province, and improve access to justice. REAL has requested funding at the same level as 2017, $50,000. This funding will be offset by a surplus that was realized in 2016. The net amount of funding is $25,491, resulting in an estimated per lawyer fee of $2.11.
Lawyers Insurance Fund Fee
The Benchers have resolved to set the annual insurance fee at $1,800 (full-time) and $900 (part-time), an increase of $50 and $25 respectively. The number of insurance reports and the amount of annual payments have been trending up slightly over the past few years, with 2017 expected to be slightly higher in both than 2016. The expansion of coverage under Part C for trust shortages from social engineering scams has increased the exposure to claims, and new significant theft losses are expected to be paid under Part B. Effective claims, risk and investment management, combined with good investment returns, had made it possible to hold the Law Society’s insurance fee at $1,750 for seven years. Although actuarial advice indicates that existing net reserves are at appropriate levels, the increasing number of reports and total annual payments warrant an increase to the insurance fee.
Total fee comparison with other law societies*
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* 2018 Law Society of British Columbia annual fee compared to 2018 projections or 2017 annual fees of other Law Societies, increased by 2%
For more information
If you have questions about the fees or the financial information in this notice, please contact Jeanette McPhee, Chief Financial Officer and Director of Trust Regulation, by telephone at 604.443.5712 (toll-free at 1.800.903.5300) or email at jmcphee@lsbc.org.
