Would ADR have helped mitigate the financial crisis

The financial crisis which stemmed from the mortgage crisis seems to count among the foremost enemies of humanity today (we give terrorism, heart disease, cancer etc. their due too). At least one person on LSC (me, for example) wonders whether ADR methods, if they had been used at the right time would have helped mitigate the financial crisis significantly.

What caused me to think along these lines was this post on the freakonomics blog which says inter alia that

Back in the old days, banks didn’t package and resell the mortgages they wrote. So when a homeowner got into trouble, they could go down and talk with the bank about working out some solution other than foreclosure. For instance, the bank could allow the borrower to pay back the loan over 30 years instead of 15 years, reducing the monthly payment".

Well that is ADR at its simplest really. The same blog also says that a typical foreclosure costs the lender about $60,000 (these people are not the India Today Sex Survey, they are friends of Krugman, you can believe their stats.)

One major roadblock in using these good ole ADR methods this time round that the banks had repackaged the mortgages and sold them off as securities so the bank did not have the full liability anymore and it they were left with no rights to renegotiate. Further, the repackaging of the mortgages as securities meant that the mortgages were not held as units and renegotiation for the end lender (the person who purchased the security, or the person who purchased a repackaged security from a person who purchased the security....) was not really an option because -
a) the disconnect between him and the mortgage (was he even aware that it was a repackaged mortgage?). He has no means of assessing whether modifying the amortization schedule or something will mean he gets his money back.
b) he wasn't the only person holding any given single mortgage, it was distributed across many securities possibly held by many different people
c) he has small pieces of too many mortgages to bother with renegotiation

There is also the question of to what extent ADR could have saved the day.

Even if it was able to come into play, it would have not been able to anything in cases which are now popularly known as Ninja loans. No humanly possible alternative payment arrangement would have been practicable in these cases. (Where there is an impossibility, there is a crooked way around it - They could renegotiate it such that they postponed foreclosure, speculated when the next real estate bubble would come around and wait till then. This is precisely the kind of hoodwinking that brought it about in the first place)

Can you think of other crises that could have been prevented or mellowed by the timely use of ADR?

A first timers take on an LLP

The proceedings of the legal literacy programme in Rockford Public School commenced in a small classroom packed with students from the 8^th, 9^th and 10^th standards and with 14 students from law school. I was nervous, as it was an unfamiliar experience being in a room packed with people full of expectations and as my prior preparation for this programme seemed insufficient to meet these.

The programme had a lucid structure consisting of skits followed by small discussions on the themes developed in each of these. Each skit was well thought out and gave great examples of everyday experiences that are often violative of fundamental rights and of protections that are guaranteed to us by the state.

For instance, the very first skit dealt with an oration given by a politician outside his home state, that glorified his homeland and criticized the state he was in then. The skit showed the public responding with aggression (even beating him up a little bit) and telling the politician to return home. Through this short skit, numerous subtle themes were brought to the fore, including the freedom of movement, freedom and speech and also the concept of reasonable restrictions. These were later discussed.

The rest of the programme worked in much the same way. The next few skits displayed a woman being turned down a job in favour of a man for no apparent reason, a student being delayed delivery of her mark sheet, a maid being unreasonably arrested for theft and a group of people falling ill due to consumption of food of poor quality and then being forced to pay hefty medical costs.

These skits too brought out very fundamental themes, including the concept of right to equality, right to information, right against exploitation and the idea of consumer protection. Over and above such thematic discussions, there were also brushes with the practicality of law and how these concepts were to be implemented by regular citizens. There were detailed briefings on First Information Reports, the prerequisites for arrest, particularly the arrest of a woman and also how the Right to Information act and Consumer protection act could be used by citizens like us.

Very honestly, I was stunned by the entire experience that lasted, all in all, for only around an hour. For one my personal legal knowledge was greatly enhanced as I was unaware of a number of things that were dealt with. Also a lot of my delusions about the legal awareness of students were altered. When we left college I thought that I would witness a certain level of ignorance at Rockford School, but slowly, I realized that many of the students we interacted with were very enthusiastic and very aware of the legal system governing them. Also, importantly, I saw the evolution of a comfort level in the programme between the two student groups that transformed a largely silent session, with people probing for response, to an energetic forum of discussion and free participation.

Although in retrospect I definitely see the programme as a success, one thing I wish had prevailed for longer is this comfort level. One way of dealing with this could involve giving the students of Rockford a more participative role in the session initially by perhaps including them in some skits. This trip has certainly boosted my enthusiasm as a member of the legal service clinic and I’m in the hope that more such chances come my way.

Ashwita

Perceptions of LSC

Coming back from the cave exploration trip,(I trust g-man will write a long and nice entry about it) I was having a introspection filled chat with the ThaLaivi about what we see LSC as and why we keep working(Thalaivi for three and a half and me for two and a half years) for LSC.

ThaLaivi was in interact in school and for her, in her first year, LSC was a natural progression from the service oriented nature of her school days. Then slowly, by her second year she realized that it was more of a learning process than a helping process. Apart from learning the law itself, in the course of LSC activities, one also learns a hundred other useful skills. Of course, I have oversimplified what she said and hope she will post regarding the same over here.

When I came into law school, I was told by my cousin that LSC was a great avenue to gain practical knowledge and have a first hand experience of the law. The "learning experience" interpretation of LSC ran in my head till the end of second year. Not that I now no longer believe LSC as a learning opportunity. LSC still remains my greatest source for knowledge regarding law, life and the ways in which one can use law in life and life in law.

Springing from the same idea, that of LSC as a learning experience, at some point I have started questioning my own legitimacy in advising people in such important matters. Though I console myself saying we always give a disclaimer when we are not sure, and how we say we are just students and we'll consult an expert(one of our teachers or alumni) or how we advise them on the law only.

Gradually as I observed how people take my words so seriously and consult me even for non-legal matters, for a short while I was a bit apprehensive about saying things, and that it might adversely affect them if they acted according to my advice not knowing it comes from a half informed source.

Very often I found myself telling people to do things that were obvious next steps in law but seemed absurd and impracticable under the circumstances and looking through the spectacles of their culture and background.

There were two questions that came up

1. Is what I tell people correct and accurate under law?
2. Is what I tell people right and useful?

The answer to the first question was kind of easy, I was saying more or less correct things and when I had a doubt I got back to them after consulting the aforementioned experts. There were a couple of occasions where I had made mistakes but there was no damage done to anybody because of that.

The second question is a bit more tough. There are many occasions where I have felt that I am imposing my beliefs on them. Though I have always couched my opinions, even on random matters, in technically correct language i have still done it knowing that what I tell them is taken very seriously. When I first started thinking like this, I also used to think whether it was right to impose these beliefs upon them. As time went by, I just got back to the usual advising without any hang ups about pushing them into a formalistic dispute resolution system which is at many levels alien to them and also in a way challenges the dispute resolution systems they have already been through. Very often these local dispute resolution institutions be it a maulvi, powerful "Silk and mangoes merchant" or a group of elders are great influence on the lives of the people even when they do not go them with a dispute. I have stopped worrying about whether LSC is going to disturb a delicate balance existing within a system. This despite disguised threats from the powerful "Silk and mangoes trader".

Though this is a little in the air as compared to the other posts on this blog, it is not completely irrelevant and without bearing on LSC. in another upcoming post, An LSC member will write about how this question of different understandings of the role played by LSC became important when deciding what LSC activities should be taken up on a priority basis.

-Vikram Hegde

My first tryst with the Legal Services Clinic...

In the first week of law school I heard about the Legal Services Clinic. An introduction was given to me in our legal methods class by the ‘convener’ and some other members. Soon after an ‘LLP’ was announced. After the initial confusion over what an LLP was, which I later realised was the short form for a ‘Legal Literacy Program’ I decided to go along and see what it was like. We were told that we would teach class 10 students ‘the law’. This seemed to be a very scary idea for me. First of all just into law school I firmly believed that I did not know any ‘law’ and secondly teaching class 10 students for me was a very formidable idea as I did not really consider myself out of school at that time..but I still went along.

Once we started off I realised that we do little skits for the students and teach them the law through that to make it more interesting for them. And to my relief in the first trip first years we were not expected to have any magical knowledge of the law but were just required to participate in the skits. So began my first llp with me acting as a hoity toity housewife who had lost her precious diamond necklace and was blaming the poor housemaid for it. And as the legal literacy program progressed I myself learnt a lot. Coming to law school, it was the first time someone told me how to file an FIR! It is then I realised how important these legal literacy programs were as even some of us first years did not know basic things like filing FIRs. Also participating in the LLPs I realised what a difference these could make and how interested these children were in these LLPs.

-Adhiti Gupta

Rajyotsava Celebrations at the Central Jail

Warm skies and a clear breeze, everything seemed perfect as we made our
way to the Central Jail on the outskirts of Bangalore on November 1st
2007. The occasion was the Rajyotsava celebrations taking place there. As
a part of the ‘We Care for You’ programme, several plays and songs were
being shown to the prisoners. LSC was putting up a play on Plea Bargaining
and RTI. In my four months with the LSC, I had only been part of
Ramnagaram trips and LLP’s. So, I was extremely excited with the prospect
of going to the prison to put up a play.

Upon reaching the prison, we were ushered in by guards and driven by jeep to
the main ground where the programme was taking place. Having been informed
of the entire programme on very short notice, we had not had much time to
prepare. On reaching backstage, we realized that we lacked a few necessary
props. So Vikas, Pranav and I went around to the other college groups
performing to borrow their props. After some convincing, they finally
agreed to let us borrow.

Ours was the first play performed and was a Kannada play set in a prison.
It tried to explain to the prisoners about the aspects of plea bargaining
and RTI through the conversations of the prisoners (played wonderfully by
Vikram, Vikas and Gauthaman). Varum Hallikeri played the legal aid lawyer,
Dipika and Ramya the defence and public prosecutor, Brunda played the
judge, Shruti the sister of the prisoner, I played the part of the jailer
as well as the narrator. However, the one who earned the most applause
from the audience was Pranav who played the chamber clerk. The entire
audience burst into applause and laughter the moment he began saying “CC…”
The entire play went off without a hitch (everyone remembered their
lines:)). After finishing, we had to sit through the rest of the
programme. Several colleges had put up plays, some performed songs. One
particular performance, a street play by BMS College was extremely good.
They conveyed a message about prisoners’ rights through a very well
enacted play.

Songs (Vikram’s jingle about plea bargaining in particular:)), dances and
even a very memorable skit about a drunk, overall it was a very enjoyable
experience. Though it was the prospect of visiting jail that spurred me to
be a part of the play in the first place, the experience proved to be very
satisfying experience and I hope to get more chances to do something like
this in the future.

Nishita (I)

First time in 3rd year :)

As with most people (a convenient assumption without any attempt at accuracy) in Law School who are participating in a Legal Services Clinic trip for the first time, I ventured on my first trip with some scepticism and not much enthusiasm. In fact, the prime reason for my going on this trip was because in conversation with Vikram (Hegde) a few days prior to the trip, I had mentioned to him in passing that I too would like to get involved in the activities of the Legal Services Clinic. Therefore, when he happened to see me about fifteen minutes before the bus was scheduled to leave, he told me to come along, and having raised the idea myself a few days before, it would have been very impolite for me not to consent.

Thus began my trip to the Murphy Town Corporation School, a Government supported girls only school in Bangalore. As with most Legal Services Clinic projects, this one too involved the enactment of skits and the introduction of several not so simple legal concepts through drama. My initial scepticism rapidly faded when I saw the immense enthusiasm which the members of the LSC, like Gowthaman and Khulali had for the trip. As soon as the bus departed from campus, the "practices" began and roles were quickly assigned. Since most of the members knew the "drill" very well, newcomers like yours truly had to be given a few lessons. That the LSC members handled with aplomb, and very effectively taught us how to tailor our parts in the drama so that the audience, (here the Girls of the School) could appreciate the legal concepts we were teaching them, including the fundamental rights, the right to succession, the right against discrimination and importantly, the right against sexual harassment. Once we got there, the members enthusiasm and commitment showed in the spirited (and judging by the reactions of the girls, effective) performances. It was clear that when we left, the children had been empowered with knowledge that would help them to tap into the arsenal of guarantees which have been provided to them.

But what was more important was the sense of change I felt in myself after the trip. The trip made me, for perhaps the first time, realise that there was a world outside the cocoon which the National Law School teaches most of its students to live in. Divorced from the world of sections and articles that is Law School, I felt a sense of involvement with the practical realities which come into play when the rights which we so vigorously debate (at an intellectual level) have to be employed by the citizen. What was heartening was that some of the girls in the School were in fact aware of several rights and guarantees available and the rest who were not were eager to learn. The receptive faces greatly enhanced the pleasure I got from acting in a few skits at the school. It also added to my thankfulness for shooting my apprehensions and witnessing first hand the remarkable project of empowerment which the Legal Services Clinic has embarked upon.

Hrishikesh Datar (III year)