Bar (law)

Lore & Background

The origin of the term bar is from the barring furniture dividing a medieval European courtroom, which defined the areas restricted to lawyers and court personnel from which the general public was excluded. Within most modern courts of the U.S., Europe and many other countries, the bar continues to be represented by a physical partition, such as a railing or barrier. The area behind the bar is restricted to lawyers, court personnel, and parties; the gallery (in front of the bar) is open to the public. This restriction is enforced in nearly all courts. In the United Kingdom, 'the Bar' refers to the collective body of barristers (referred to in Scotland as advocates), not the professional organization (which is the Bar Council or Faculty of Advocates); the other type of UK lawyer, solicitors, have their own body, the Law Society. Correspondingly, being 'called to the bar' refers to admission to the profession of barristers, not solicitors. Other jurisdictions make no such distinction and all lawyers for admission may be said to be called to the bar. In the United States, this procedure is administered by the individual U.S. states and their respective bar associations. In general, a candidate must graduate from a qualified law school and pass a written test: the bar examination. Almost all states use the Multistate Bar Examination (MBE), a multiple-choice exam administered on one day of a two- or three-day test. An increasing number use the Uniform Bar Examination, which includes the MBE. In either case, on days during which the MBE is not administered, the bar exam may include questions related to that state's laws. If the candidate reaches the score required by a particular state, the candidate is then admitted to the bar. A lawyer whose license to practice law is revoked is said to be disbarred.

Reader's Guide

The bar is significant as the central institution of the legal profession, representing both the physical division in a courtroom and the licensing process for lawyers. Its legacy includes the distinction between the bar and the bench—lawyers who represent clients versus judges who adjudicate—and the phrase 'bench and bar' denotes all judges and lawyers collectively. The bar's role in licensing ensures that lawyers meet qualifications such as passing a bar examination, and in the U.S., state bar associations may set additional requirements like character screenings or ethics exams. The term also extends to specialized branches, such as the tort bar for lawyers who specialize in civil suits for damages. In the UK, the bar is specifically for barristers, while solicitors have their own body, the Law Society. The concept of being 'called to the bar' marks admission to the profession of barristers. The bar's influence is seen in the patent bar, a separate examination by the USPTO for those with science or engineering backgrounds, who become patent attorneys or agents. Overall, the bar remains a foundational concept in law, governing who may practice and how courts are structured.

Did You Know?

• The term 'bar' originates from the barring furniture dividing a medieval European courtroom.
• In the United Kingdom, 'the Bar' refers to the collective body of barristers (or advocates in Scotland), not the professional organization.
• A lawyer whose license to practice law is revoked is said to be disbarred.
• The patent bar examination by the USPTO does not require law school; it requires a science or engineering background.

Structural Diversity in Legal Practice Organizations

Law firms take on a remarkable variety of legal forms depending on where they operate. At the simplest end sits the sole proprietorship, where a single attorney bears full responsibility for every profit, loss, and liability the practice generates. Moving up in complexity, general partnerships distribute ownership, earnings, and legal exposure equally among all member attorneys. Professional corporations mimic the stock-issuing model of traditional business entities, while limited liability companies shield their attorney-owners—called members—from direct claims by third-party creditors, though many jurisdictions prohibit this structure outright or permit it only under the label of a Professional Limited Liability Company. Professional associations function much like their corporate or LLC counterparts. Perhaps the most hybrid form is the limited liability partnership, in which attorneys remain mutual partners yet no individual partner faces liability for another's negligence or for the firm's creditor obligations. Crucially, the LLP is taxed as a partnership while enjoying the protective shield typically associated with corporate structures, blending fiscal simplicity with risk isolation.

The Nonlawyer Ownership Controversy

In most legal systems, including the United States, a fundamental rule confines ownership and managerial control of law firms to licensed attorneys. This means firms cannot raise capital through public stock offerings; they must instead seek additional contributions from equity partners or borrow against receivables. The American Bar Association codified this bar in Rule 5.4(d) of its Model Rules of Professional Conduct, adopted in every U.S. jurisdiction except the District of Columbia and Arizona. Even D.C.'s exception is narrow, allowing equity only for nonlawyers who actively assist in delivering legal services, not passive investors. The rule remains contested. Proponents argue it protects zealous advocacy and prevents conflicts arising when lawyers serve shareholders. Critics counter that it stifles innovation and keeps services costly.

Cross-Border Architectures for Global Firms

Law firms that practice across multiple countries face a web of local regulations that often prevent a single unified entity. In jurisdictions such as Hong Kong and Japan, partnerships between local and foreign lawyers are restricted, forcing multinational firms to build layered structures of separate national or regional partnerships. Under this model, multiple national or regional partnerships form a loose association in which they share branding, administrative functions, and various operating costs. However, each constituent partnership maintains its own separate revenue pool and often its own partner compensation structure, preserving local autonomy while presenting a unified global face. Other large multinational firms choose a different approach, operating as a single worldwide partnership—typically structured as a British or American limited liability partnership—while simultaneously requiring their partners to participate in local operating entities in each country as dictated by local regulatory requirements. Both strategies reflect the tension between the desire for global brand coherence and the legal reality that each jurisdiction demands its own compliance architecture.

Measuring Firm Performance

Three financial statistics are commonly used to evaluate and rank law firms. The first, profits per equity partner (also called PPP), divides net operating income by the number of equity partners. A high PPP figure is often associated with a firm's prestige and its appeal to prospective equity partners. However, this metric is vulnerable to manipulation: a firm can inflate its PPP by reclassifying less profitable partners as non-equity partners, thereby reducing the denominator without changing the numerator. The second metric, revenue per lawyer, divides gross revenue by the total number of lawyers in the firm. This figure reflects the general revenue-generating capacity of the firm's legal staff but fails to account for significant expenses such as associate compensation and office overhead costs. The third indicator, average compensation of partners, calculates the total amount paid to both equity and nonequity partners. Together, these three measures offer complementary but incomplete pictures of a firm's financial health, each highlighting a different dimension of profitability while leaving others in shadow.