Go to contents

Lawyers Face Tough Times Amid Sluggish Economy

Posted August. 19, 2008 07:39,   


○ Avg. number of cases per lawyer below three

The annual revenue of the domestic legal service market is 1.3 trillion won, less than that of a single major U.S. law firm. Korea`s top six law firms employ 10 percent of the country`s lawyers and earn half of the industry`s sales.

Every month, each lawyer takes on fewer than three cases. According to the Seoul Bar Association, the average number of cases for each lawyer fell from 38.2 in 2002 to 31.5 last year.

Though the number of lawyers doubled this year after passing the 5,000-mark in 2002, the number of cases that appointed lawyers rose only 40 percent over the same period.

Furthermore, freelance lawyers hardly come across criminal cases, most of which appoint judge or public prosecutors-turned-lawyers at law firms. In addition, more defendants are requesting court-appointed lawyers due to the economic downturn.

According to the Korea Legal Aid Corporation, the number of defendants represented by court-appointed lawyers free of charge rose 30 percent from 17,304 in 2006 to 22,494 last year.

Lawyers no longer take home fat paychecks. Given that the average service charge in the industry is between three million and 10 million won depending on a lawyer’s experience, the monthly income of a lawyer is estimated between seven million and 26 million won.

A freelance lawyer spends at least 15 million won per month to employ two assistants, rent an office, and pay for miscellaneous expenses.

One freelance lawyer in Seoul`s Seocho-dong area, where the Supreme Court and many other legal offices are located, said, “Many lawyers have gone out of business due to credit delinquency because they cannot manage to land one or two cases involving a small sum of money a month even here in Seocho-dong.”

○ Service charge fraud rising

More lawyers have resorted to illegally overcharging their clients to make up for their faltering business.

The Supreme Court in April sentenced one veteran lawyer to one year in prison for extorting hundreds of millions of won from his client to lobby judges and prosecutors to release the client’s father from prison.

Another lawyer was arrested in June on the charge of embezzling property worth 750 million won from an elderly female dementia patient living alone in the United States, by deceiving her into writing a letter of attorney.

The number of lawyers subject to disciplinary measures from the Korea Bar Association rose from 15 in 2002 to 47 last year. The number of applications for damages from legal service violations to the Korea Consumer Agency increased from 325 in 2002 to 437 in 2006.

More lawyers have urged their clients to sue to raise their earnings.

One judge at the Seoul Central District Court said, “Many lawyers unreasonably push their clients to file lawsuits to charge them for winning the case even when it can be settled without trial.”

Another negative factor is the incessant rise in the number of class action lawsuits where lawyers seek small but quick profits.

Though class action lawsuits have great significance in that they confront a giant organization on behalf of powerless individuals, many of them have lost their initial cause and many lawyers prioritize financial return.

A prime example is a class action lawsuit filed by 70,000 residents nearby a K2 air force ground in Daegu for noise pollution. The case has been delayed by redundant submission of letters of proxy after many lawyers competed to join the case from August 2004.

○ Bureaucratic tendency of judicial officers

Though the National Assembly has submitted bills on limiting the appointment of lawmakers cum lawyers or on curbing excessive service fees, these bills have gotten lost amid discussion.

Ruling party floor leader Hong Joon-pyo failed to include a “self-purification declaration” banning lawyer turned lawmakers from taking on cases in a general lawmakers’ meeting early last month. In addition to inciting a strong backlash from lawmakers who had worked in the legal profession, the idea was pushed out of the agenda due to other pending issues such as the opening of the National Assembly.

According to the Korea Bar Association, only one of 58 incumbent lawmakers who were lawyers have given their registration as lawyers, while 11 put a temporary halt on their business.

Last month, lawmaker Kim Dong-chul of the main opposition Democratic Party proposed a legal revision limiting a lawyer`s service charge, banning lawyers from receiving incentives for winning criminal cases. In addition, lawmaker Lee Sang-min of the minor conservative Liberty Forward Party proposed the abolishment of a system that automatically gives lawyers qualifications for practicing as patent lawyers or licensed tax accountants.

These reforms, however, seem doomed. Similar proposals have come up before, but have all been turned down in the end due to strong lobbying by lawyers.

Some have suggested limiting judges and public prosecutors from joining law firms after their retirement but this idea has invited a strong backlash.

A senior judge in Seoul said, “These days, the honorable treatment for ex-judges and ex-prosecutors lasts less than a year after their retirement. This means they have to find a way to make ends meet for the rest of their lives in that one year. Doing so is challenging because law firms prefer talented independent judges with 10-15 years of experience than high-maintenance senior judges.”

A young judge at the Seoul District Court said, “In the past, judges fought hard against external pressure even if it meant leaving their posts. This is no longer the case, however, since everyone is anxious to protect their positions at the court. The recent slump in the legal service market has strengthened the bureaucratic tendency of judicial officers, to the worry of many people.”