Drawn and quartered: the municipal law department

The city solicitor of many local governments often reminds me of Mel Gibson in the movie Braveheart – especially in the last scenes where horses pull him in four different directions in front of a crowd. Competing imperatives make it difficult to please anyone for very long. My experience with several dozen consulting engagements with 20 city and regional government bodies tells me that delivering legal service at the local government level is challenging work. And it’s changing all the time.

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 heavily unionized workforces. At one time, there was great turmoil with city mergers and some “de-mergers” in Nova Scotia, Quebec and Ontario. Most initiatives are provincial in nature, and those in Ontario were accompanied by a significant devolution of provincial services to the local level but without the appropriate supplementary funding.

This type of change has undoubtedly resulted in considerable work for law firms representing city interests. Law firms take an active interest in electoral campaigns to ensure their centers of influence for future matters are not disrupted. It will be another few years before the full range of competitive and transparent procurement practices is introduced for legal services at the local level. Recently, this has been hurried along with the injection of federal and provincial infrastructure funding.

Local government mergers also resulted in more work for municipal and regional law department members. But economic activity is the more significant stimulus for increased demand for in-house counsel. As found in Ontario, BC, Quebec, and Alberta, robust economic activity spurs commercial and residential development activity. Zoning and other by-law changes, followed by requirements for additional infrastructure and the interest in public-private partnerships for LRTs, arenas and stadiums, highways and other projects, call for new commercial law capabilities within local government.

Some regions of the country deregulated their utilities such that municipal counsel spend more time with regulatory bodies designed to balance public/private interests or ensure a 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 increasingly specialized; and that some 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, act on and pay for many matters is limited at the local level. Provincial laws and regulations mitigate or at least complicate many programs. Bravehearts in the legal department face at least five challenges.

1. Their roles and responsibilities need to be more explicitly defined. Too much time is spent in commodity-level work processing real-estate matters because of poor streamlining among legal, planning, procurement, engineering, and city clerk departments. All the old procedures and rules remain while new demands are added.
2. Lawyers in some law departments are unclear about their accountability – to council, to the law society or city management. Too many have been trapped in a losing trade-off of political, financial, ethical, and legal pressures. The result can be a tendency by some cities to involve their in-house counsel as little or as late as possible.
3. Core capabilities for 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 need help to keep up with the need for commercial contracts and expertise in financing. More municipal law departments need to prepare detailed multi-year forecasts for legal services. Skill, stamina and goodwill are not enough to secure and deploy the resources to keep up with changing demand.
4. 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. Ultimately, they pay 20 to 30 percent more than they should for external counsel because they do not develop long-term partnering agreements with professional firms.
5. Finally, municipal counsel share a fault with many other law departments. They need to improve at tracking their activities by type and by importance. That makes it difficult for them to report significant successes every quarter. Few conduct satisfaction surveys with their primary users regularly. 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.

Adapted from original article in Lexpert March 2006.