The competence of the practicing bar has been subjected to substantial criticism in recent years. Since law schools have a virtual monopoly over access to the bar and licensure is granted without further training, legal education has been a particular focus of attack and reform efforts. Yet there has been little systematic study of what skills and knowledge are important in the actual practice of law or the relevant contributions of legal education. This study of practicing lawyers in Chicago examines the nature of the competencies important to the practice of law and the sources lawyers credit for contributing to their development.

Practitioners cite a broad range of skills, many of them not unique to the practice of law, with their importance varying by the predominant legal specialty practiced. The data further indicate that law schools play but a part in the development of skills and knowledge important to the practice of law and that experience, both prior and subsequent to graduation, plays a significant role. The evaluation of law schools' contributions is related to opportunities for further training, particularly in the context of law firm practice. There is, however, a strong general view that law schools rather uniformly concentrate on some skills to the exclusion of others and that the former are not necessarily those that lawyers think are most important to the practice of law.

This article focuses on the corporate actor elite of Chicago's legal community—those attorneys who practice law with and for the major business, social, civic, and cultural organizations in the city. A continuation of a previous article, this article focuses on the differential allocation of professional respect made within that elite. Specifically, the discussion centers on the “second-class citizenship” in the legal community to which elite house counsel are relegated by elite partners in private law firms.

The first half of the article probes the social bases for that stigma. Examining a number of alternative explanations, it offers most support to one based on differences in the educational preparations of the respondents, to the effect that house counsel attended less prestigious law schools and performed less outstandingly at these schools than did firm partners at theirs. In the concluding half of the article, the effects of the stigma on elite social cohesion and commonality of purpose are examined. What emerges from this analysis is the finding that the house counsel stigma—strongly felt as it may be by all concerned—nevertheless generates no lasting lines of social cleavage within the corporate actor legal elite.

In an effort to promote business flexibility and efficiency, corporation law has moved from a rule of unanimous shareholder consent to simple majority rule for fundamental changes. A strong utilitarian theme runs through much of the discussion of this change—that some individual hardship might be necessary in order to promote group welfare. But the creation of power in the majority to effect such changes also created the power to squeeze out the minority through self-dealing. While the business-purpose test has been developed to preserve the goal of group wealth maximization, in practice it bears little relationship to this goal. The test provides no means for measuring the costs and benefits of a fundamental change, and attempts to judge what are proper or improper business purposes intrude on the domain of business judgment. The assumption that all decisions reached by a disinterested majority maximize aggregate welfare is based on a logical fallacy, so that not even arm's-length transactions approved by a majority are free from risks of inefficiency. Further development of judicial restraints on majority rule promises little in the way of efficiency, and a re-examination of alternative rules of group decision making is required.

The people's sense of what is good and right is both the ultimate source and the ultimate strength of the rules that govern a democratic society. If there is a major discrepancy between that sense and the rules, the rules and those who cling to them will eventually disappear.