Law firms in cities and towns across Canada have at least one partner serving the municipal sector. A few firms specialize in municipal law, while others focus on the labour and employment elements with municipal work forces that are heavily unionized.
There has been great turmoil with city mergers, and some “de-mergers,” in Quebec, Nova Scotia, and Ontario. Most city merger initiatives are provincial in nature and those in Ontario have been accompanied by a significant devolution of provincial services to the local level, but without the appropriate supplementary funding.
No doubt, this type of change has resulted in considerable work for law firms representing city interests. Law firms take an active interest in electoral campaigns to ensure their sources of referrals for future matters are not disrupted. It will be another few years before a post-Gomery tsunami of competitive and transparent procurement practices is introduced for legal services at the local level.
However, mergers have also resulted in more work for members of municipal and regional law departments. Still, economic activity is by far the greater stimulus for increased demand for legal counsel. Robust economic activity, as can be found in Ontario, B.C. and Alberta, spurs commercial and residential development activity. Zoning and other by-law changes, followed by requirements for additional infrastructure, and an interest in public-private partnerships for highway and other projects call for new capabilities in commercial law within local government.
Some regions of the country have de-regulated their utilities such that municipal counsel spend much more time with regulatory bodies designed to balance public / private interests, or to ensure a more level playing field for competition, e.g. electricity, transportation, etc. This list goes on, but it suggests two trends: that the legal services required by local government are of an increasingly specialized nature; and that too many law departments struggle to be “all things to all people.”
Many law departments try in vain to explain to stakeholders that the authority to decide, to act on and to pay for many matters is limited at the local level. Provincial laws and regulations mitigate many local programs. Bravehearts in the legal department face at least five challenges.
- Their roles and responsibilities are not defined specifically enough. Much time is spent in commodity-level work processing real-estate matters, because of poor streamlining among legal, planning, engineering and city clerk departments. All the steps in the old methods are kept while new demands are added.
- Lawyers in some law departments are unclear about their accountability – to Council, to the Law Society or to City Management. Too many have been trapped in a losing trade-off of political, financial, ethical and legal pressures. The result is a tendency by some cities to involve their inside counsel as little or as late as possible.
- Core capabilities for inside municipal counsel have been municipal / administrative law including municipal hearings, by-law development, and planning / land use matters. Few law departments have capabilities in labour / employment law, and many others cannot keep up with the need for commercial contracts and expertise in financing. Almost no municipal law departments prepare detailed multi-year forecasts for legal services. Skill and goodwill are not enough to secure and deploy the resources to keep up with changing demand.
- Larger law departments will carry some litigation capability. Most prefer to refer large, complex files to law firms, but they do so without active litigation management programs. Cities tend to use too many law firms to spread the work around. In the end, they pay 20 % to 30 % more than they should for outside counsel because they do not use long-term partnering agreements with professional firms.
- Finally, municipal counsel share a fault with many other law departments. They are poor at tracking their activities by type and by importance. This makes it difficult for them to report significant successes on a quarterly basis. Few conduct satisfaction surveys with their primary users on a regular basis. Key performance indicators with an emphasis on non-financial indicators are in short supply.
Municipal counsel must do a better job in defining and restricting their work to higher profile matters. They must become more adept at shedding routine work. Accountability for service and results must be unambiguous. Successes must be regular and reported to survive and thrive.