Tech to transform the legal industry

A concept as old as civilisation itself, the law is a critical aspect of our lives. 

Society depends heavily upon it, and has done for century after century. 

But could administering the law be significantly advanced, for the benefit of those it’s designed to protect? 

More than virtually any other sector, the legal industry has always been painfully slow-moving, a point noted in the recent Shaping the Future of Law report, released by government-backed initiative LawtechUK. 

The COVID pandemic increased the need for law firms to adapt modern technology. Given the industry’s insistence on sticking with traditional methods, this was less a case of moving with the times and more like a long, long overdue game of catch-up. Court hearings still required in-person attendance and, painstakingly, submissions to chambers still had to be in the form of paper documents delivered by hand or by post.  

Now, a year and a half on from the first lockdown, technology has proved its value. It is now a question of how far the industry will move with the times, with considerable investment in research and development and changes to legal training to update the legal sector’s skill set and capabilities. After all, if the computer is expected to handle a solicitor’s workload then the software used has to be specially designed, appropriate and fit for purpose. 

SCREEN TIME: Court hearings, meetings and interviews can be conducted remotely

LawtechUK was established with the aim of easing and supporting the legal and court service sector’s technological transformation. Its focus is on increasing awareness and understanding of technology with a commercial focus that affects and enhances the business. Tipped to become a £22bn industry, lawtech has more than 12,000 employees tasked with transforming the sector, making legal services accessible, effective and affordable for everyone. 

The 2021 report – essentially a feasibility study into the prospect of radically changing the legal landscape – is a collaboration between the government, the Lawtech Delivery Panel and Tech Nation, and is uniquely positioned to help drive technological advances in law.  

  

And, in the wake of the LawtechUK report the initiative is calling on all those in the legal profession to collaborate to enable systematic change. This would, says the report, bring about: “Greater access to legal services, and better, faster, more affordable outcomes, through DIY applications, asynchronous online services, on-demand advice and dispute resolution tools.” 

Innovation and technology are crucial in transforming the justice system and will play a huge part in the UK maintaining a leading role in the world’s legal services sector. 

Modern methods make the best legal support accessible to everyone. 

And the report identified seven ‘action areas’ that need addressing to accelerate a digital transformation over the next five years. 

These are:  

  1. Investment
  2. New markets
  3. Data 
  4. Connectivity
  5. Technology awareness and capability 
  6. Policy and regulation 
  7. Sustainable growth 

So, what were LawtechUK’s findings in each of these seven targeted action areas? And how will each aspect help the legal sector to accelerate its digitisation? 

Investment

More investment in technology and research and development is needed by the law sector. The average investment of UK business sectors is 5% of revenue but the legal eagles are lagging, with very few firms even targeting 1%.  

UK law’s startup and scaleup market is growing, however. It’s more than doubled in the last three years, rising at a faster rate than other sectors in that period. 

Technology can enhance the legal profession’s role in society, by improving the quality and accessibility of legal and court services for all. 

General counsels should take prominent roles in the sector’s investment in – and adoption of – technology, helping to reduce paper documentation and manual processes in favour of far more efficient automation and e-billing. 

New markets

While it is true that legal services do not, in the main, meet the needs of small-to-medium-sized enterprises (SMEs) and consumers, there is an untapped market waiting to be discovered by the legal industry. That combined market, the report estimates, is worth up to £11.4bn annually. 

SMEs make up almost 99% of the UK’s businesses and account for more than half of the private sector’s turnover. But three in 10 SMEs say they deal with at least one legal issue each year and half of those handle these issues on their own. A whopping 96% of SMEs regularly experience bad debts and commercial disputes cost them more than £11bn per year. 

OVERHAUL: The legal sector's long-overdue upgrade was accelerated by the coronavirus pandemic

The overdue payments for SMEs collectively totals £23bn, with a further £4bn incurred in costs chasing payments. Modernising their systems to provide accessible, affordable services can lead to immense savings, with current projections of conveyancing services saving nine million hours – and £25m – per year. 

Data

LawtechUK’s report includes digitisation proposals for legal data that mirror the transformation of open banking, with legal data opened up for use and re-use by authorised third parties across the sector. 

Everyone working within the legal sector will have to look at how best to collect, embrace and utilise data as well as making it accessible. Data is crucial in decision-making, and effective methods to collect, store and retrieve that data is critical to the industry’s future. 

WORKING WELL: The industry requires software that is fit for purpose and makes legal professionals and their clients' lives easier

A collective effort is needed, including co-operation between the government, regulators and organisations, to establish common approaches and governance. 

Also of utmost importance is risk management. A data-led approach to the risks of a breach is vital with, as an example, data analysis being used to assess the likelihood of litigation and detect instances of compliance exposure. 

Connectivity

A collaborative approach is key to making sure that legal and court services use the technology available to meet the needs of users and their customers and clients. 

LawtechUK believes the sector’s challenges will be overcome more quickly and effectively if tackled as a collective, an approach that will also bring a longer-lasting solution, making it easier for the industry to thrive. 

Instances of effective collaborations include partnerships to develop a road traffic accident claims portal and an AI-powered case handling system. 

Technology awareness and capability

Basic training in the legal sector has barely changed in the last half-century. Those practicing law have always been tasked with staying ahead of the curve – technological advances have not changed that. Legal education, says the LawtechUK report, is about how to ‘do law’, rather than developing any business or technology skills. 

However, legal professionals these days know they need to be fluent (or, at least competent) in data analytics, innovation techniques and ethical issues raised by the use of technology. Far from being added bonuses, these skills have edged into the column marked ‘essential’ and means the stereotype of the stuffy technophobic ‘old-school’ lawyer is being consigned to history. 

Diversity is also a key factor in the sector’s progress. The culture is, quite rightly, shifting to a more diverse one that better reflects the communities it serves. These different backgrounds and perspectives offer ranges of expertise and experiences, a must as the industry moves forward. 

Technical literacy, and its promotion, is a foundation for innovation in the future, as is the ability to harness tech capabilities. 

Policy and regulation

Policy makers and company regulators will be expected to lead by example with legal innovation. In instances of tech deployment and committing to open data, they are expected to lead the crusade to build confidence in lawtech. Of course, the government also needs to take a lead role in addressing systemic challenges in the legal industry.  

All government services are to be fully digitised in the next five-to-10 years and it is expected that, alongside them, legal and court services will be expected to be made as convenient and useful as innovative private sector systems and procedures. 

As for court hearings, the coronavirus pandemic led to technology changing the sector, perhaps irreversibly. Remote hearings have, in the main, proved effective. With UK courts dealing with four million cases in an average year there is now a record backlog of almost 60,000 outstanding crown court cases in England and Wales.  

New ways are needed to handle disputes, notes the report, if the justice system is to keep pace with the technological changes to other aspects of our lives. 

Sustainable growth

The report examined the positive and negative impacts of technology in our working and personal lives, concluding that the internet’s connectivity enables so much that was previously impossible. But at a cost. Online abuse via social media, and even innocent addiction to online platforms is now, sadly, commonplace, as is the large-scale distributing of criminal, inciting or offensive material. 

HOME OFFICE: Workers across the UK are expected to spend more time working from home than ever before

The lawtech report suggests that there are boundless positives for legal professionals, however. Advancements will allow legal and court professionals to make their services more efficient. But technology alone cannot meet the profession’s responsibilities. It can only help, by increasing transparency and consistency within the law. 

So, what is the future of the legal industry in terms of how technology is implemented, adapted and integrated? 

In his introduction to the report, Justice minister Lord Wolfson praised the authors for what he calls an important contribution to the debate, though stresses that the ideas contained therein don’t shape government policy. 

Rather than being government-led, the industry needs to use the technology available to improve their clients’ satisfaction levels. After all, lawtech did so much to save their livelihoods during the pandemic and the advancements were clear, with remote court appearances being just one example. 

As for paper retention, offices had already started to adapt electronic filing systems and keeping hard copies only when it was a legal requirement. The move towards greater use of technology may have been accelerated by the coronavirus but it’s now time to embrace innovation and explore the possibilities that lawtech offers, so that the sector can deliver legal services that meet the needs of society today, and beyond. 

Jenifer Swallow, LawtechUK’s executive director, said: “The law is critical in all our lives and businesses, and it should be easy to engage with and affordable and effective for everyone. Lawtech is how we make that happen. 

“The sector is seeing incredible growth – with lawtech start-ups and scale-ups growing at 101% over the last three years and adoption levels increasing during Covid-19 across our courts, legal businesses and in-house legal teams.” 

Lawtech benefits for legal professionals today

Dispute resolution for legal professionals  

Technology that supports the handling and resolving of disputes in a way that reduces costs, time and backlogs. 

Legal document creation, management and review 

Technology that supports contract creation from start to finish. 

Legal advice and documents for individuals and SMEs 

Technology that allows customers to create their own contracts and access bespoke legal advice. 

Legal services marketplaces 

Technology to allow people and businesses to quickly find a lawyer that is appropriate for their needs and budget. 

Regulatory compliance 

Technology that helps law firms adhere to their compliance obligations and minimising the risk of a data breach. 

Transactions 

Technology that makes large-scale commercial transactions more efficient and accurate. 

Wills and probate 

Technology to enhance and simplify what are traditionally time-consuming tasks, facilitates access to legal services and reduces the costs. 

Dispute resolution for individuals and SMEs 

Technology that creates accessible mediation channels for individuals and SMEs to resolve disputes. 

Conveyancing 

Technology that allows documents to be signed digitally and people and companies’ identities to be verified online. 

Intellectual property 

Technology to create and manage intellectual property rights and alert rights holders to be alerted of possible infringements. 

Legal practice, work and case management 

Technology to enable firms to compile e-bills, records, activity and workflows on each case. 

Legal information and knowledge for legal professions 

Technology to make researching and information gathering efficient and easier to share.