Statements made by Stanislav Danilov to article ‘Lawyer Monopoly. Lawyers on Admission of Lawyers to Arbitration and Civil Courts.’ ‘Delovoy Peterburg’, 22 November 2018
The State Duma adopted in the third reading a package of amendments to the procedural laws proposed by the plenum of the Supreme Court of the Russian Federation in the autumn of 2017. The most notable innovation was that only representatives with a higher legal education can be admitted to arbitration and civil proceedings (by analogy with the Administrative Procedure Code). Lawyers interviewed by the DP differed in the appraisal of the novelty.
‘According to the polls, most lawyers welcome the initiative, which will enhance the protection of the parties against unscrupulous representatives, and promote qualified legal assistance. These changes are likely to affect the pricing of the legal services market. However, no one has repealed the rule according to which the interests of organizations in courts can be represented by persons not subject to the requirement of a higher legal education (e.g., Director General, Patent attorney, receiver, a trade union representative on the labor dispute). In addition, the exception to the rule of higher legal education representative will be the cases considered by magistrates or district courts,’ said Natalia Verevkina, the head of the Dispute Resolution Practice Rightmark Group.
‘The way I see it, the requirement for legal representatives to have a higher legal education is nothing but cosmetics. First, this does not apply to representation in district courts or with justices of the peace, while the latter is the lion's share of all cases heard by courts of general jurisdiction. Second, arbitration courts have long engaged only persons with a higher legal education, i.e. full-time or engaged lawyers and attorneys. There is nothing surprising about it, because no prudent manager will charge, for example, an accountant to collect debt under a contract. Even to the extent that the company does not have a full-time lawyer and the small price of the dispute does not justify paying legal advisors, managers usually prefer to represent the interests of their companies on their own, which is not forbidden by this package of amendments. It is unlikely that this package of amendments will have a significant impact on judicial practice or the legal market and certainly will not lead to a procedural revolution,’ says Stanislav Danilov, the head of the Corporate Law and M&A and Dispute Resolution practices, a partner of Pen&Paper Attorneys-at-Law.
‘Providing qualified legal assistance to participants in the process who do not have legal knowledge is one of the most important tools for increasing citizens' confidence in the judicial system in general. It was especially important to consolidate such qualification requirement at the level of the most popular legal and business cases. Meanwhile, a representative’s law degree in isolation is not a panacea. It seems that the qualification requirement should give a systemic impetus and not only limit the circle of people admitted to civil or arbitration proceedings, but also strengthen educational standards in law schools, which will allow to establish a truly strong competent community of expert representatives. Thus, it is important to ensure comprehensive reform, including at the level of training and selection of staff for the community,’ said Alexander Svashenko, a lawyer at Lawyer office Egorov, Puginsky, Afanasyev and Partners.
‘Those changes reflect the general ideology of the forthcoming reform of the legal services market. Introduction of a rule that allows only persons with a higher legal education to administrative court proceedings is a kind of trial balloon. There is no such a rule regarding lawsuit cases, bankruptcy cases, or special cases so far. More radical steps will follow.’
In particular, it is assumed that not just holders of higher legal education, but only those lawyers who have the status of attorney will be allowed to all categories of disputes as representatives of the parties. What is meant here is the introduction of attorney monopoly. Adoption of the attorney monopoly from the legal services market (to be more exact, from its most significant segment, i. e. judicial consideration of disputes) will expel numerous ‘quasi-attorneys’ who sometimes, even not having legal education, accompany legal cases. It should be noted that Russia is one of the last states in the post-Soviet area, which plans to introduce a lawyer monopoly. An attempt to resolve this issue took place in the first half of the twenty hundreds and even the appropriate changes were made in the Administrative Procedure Code. However, the Constitutional Court of the Russian Federation found it unconstitutional to restrict the right to appoint any person as its representative in court,’ noted Oleg Skvortsov, the head of the court practice at DLA Piper, professor at the Department of Commercial Law of Saint Petersburg State University.
‘There are fears that limiting the number of representatives may lead to changes in remuneration of lawyers. Naturally, upward. Meanwhile, these concerns, although not unfounded, are unlikely to be fully justified,’ the expert added.
Stanislav Danilov, partner, head of Corporate Law and M&A Practice and the Dispute Resolution Practice of Pen & Paper