Regulation of the Legal Profession Flashcards
INHERENT POWERS OF COURTS TO REGULATE LAWYERS
State Courts
- Regulate all aspects of the practice of law within their jurisdiction;
- each state has its own bar association and rules of professional conduct.
- The highest court in a state generally oversees the promulgation of legal ethics rules and also supervises the discipline of lawyers in the state.
- Most states base their rules of professional conduct on the ABA Model Rules, but the ABA, a voluntary association of lawyers, has no direct regulatory authority over lawyers and no authority to discipline.
- Membership in a state bar association is voluntary in some states and mandatory in others.
- Legislative enactments can also affect the practice of law in a state, as for example, in defining the extent of the attorney-client privilege.
Federal Courts
- Each federal court has its own bar and a lawyer must be admitted to the bar of a federal court in order to practice before it.
- Although many federal courts apply the ethical rules of the state in which the court sits, they are not required to do so. Each federal court has the inherent authority to regulate lawyers who appear before it.
Disciplinary Sanctions vs. NON-Disciplinary Sanctions
Disciplinary Sanctions (think BAR)
- Censure (scolding)
- Disbarment
Non-Disciplinary Sanctions (think CLIENT)
- Disqualification: Thrown out of representing a particular client
- Civil Liability: Usually, malpractice
- Criminal Liability
Regulation BEFORE Admission
1) Education—graduation from ABA-accredited law school
2) Character and fitness test
- Crimes of Dishonesty = Disqualification
- Non-Disclosure of ANY crime = Disqualification
- Failure to make Reasonable Efforts to Pay Debt = Disqualification
3) Truthfulness—no lying on the application for bar admission or law school admission
4) Exam—requires a passing score
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NOTE
- NO Residency Requirement
Admissions issues will present in one of two ways:
- Permission to SIT: issue discovered BEFORE EXAM
- Permission to ENTER: issue discovered AFTER EXAM
- Both are treated the same way = Usually Suspension
Regulation AFTER Admission
Various ways in which an admitted attorney can be subject to Discipline
- Censure, Disbarment
1. VIOLATION of the RULES
2. CRIMINAL ACT that speaks to attorney’s HONESTY or fitness to practice
- Racking up Speeding tickets > NO
- Lying on Mortgage application > YES
3. FRAUD or DECEIT, even if not criminal
a) Procedural fraud = lying to the court (fraud upon court)
b) Conventional fraud = Common law fraud (For disciplinary purposes under the MRPC, do NOT need to prove RELIANCE or DAMAGES)
- making a statement
- knowing it is false
- intending to deceive
4. State or imply an ability to influence improperly a government agency or official
- Ex: attorney states to her client that she has the judge in her “back pocket,” (implying that she has complete control over the judge and can influence him improperly with regards to the outcome of the case)
5. Harassment or Discrimination in the Practice of Law
- Conduct that the lawyer knows or reasonably should know is harassment or discrimination on the basis of race, sex, religion, national origin, ethnicity, disability, age, sexual orientation, gender identity, marital status, or socioeconomic status in conduct related to the practice of law.
Partners / Supervising Attorneys Duty to SUPERVISE
1) Partners / Managers – Must make reasonable efforts to ensure that firm has measures in place to give reasonable assurance that ALL EMPLOYEES conform to MRPC
- MUST have a SYSTEM in place to ensure compliance with the rules of professional conduct.
- it is a violation in and of itself for a firm to not have these systems in place – even if there is no violation
2) Supervisory Attorneys – Must make reasonable efforts to ensure that supervised nonlawyer’s conduct conforms to MRPC
Vicarious Liability of Attorneys
1) Partners / Managers – Responsible if lawyer knows of conduct at time that its consequences can be avoided/mitigated but fails to take reasonable remedial action
2) Supervisory Attorneys – are liable for the violations by subordinate attorneys AND non-professionals if they:
- Order
- Ratify
- After learning of violation, fail to take remedial action
3) Subordinate Attorneys – No Nuremburg defense (“I was only following orders.”)
ONLY DEFENSE is that:
- (1) the issue giving rise to the violation posed an arguable question of professional duty AND
- (2) the subordinate lawyer acted in accordance with the supervising lawyer’s reasonable resolution of that question.
Out of State Conduct
Out-of-state conduct can expose you to discipline at HOME
- Ex: Liscensed in FL. Commiting perjury in a matter in Maine can lead to discipline in Florida.
Conflict of Laws—which law applies to lawyers conduct? (other than the home state)
- Lawyer’s belief—the conduct must conform to the rules of the jurisdiction in which the lawyer reasonably believes his conduct will have a predominant effect.
“Snitch” Rule
A lawyer is REQUIRED to report violations to disciplinary authorities if:
- The reporting lawyer has ACTUAL KNOWLEDGE of a SUBSTANTIAL VIOLATION
- The violation goes to lawyer’s substantial honesty, trustworthiness, and fitness to practice law.
Duty to Report Limited by Duty of Confidentiality
- The duty to report misconduct of other lawyers does not require disclosure of information otherwise protected by the lawyer’s duty of confidentiality, including information learned during consultation with a prospective client.
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Actual knowledge
- the personal observation or knowledge of the reporting lawyer OR
- inferred from the circumstances.
Inferred from circumstances
- knowledge must be supported by independent corroborating evidence that would cause a reasonable lawyer to form a firm opinion that the conduct more than likely occurred
- This includes learning of the misconduct from a reliable source PLUS independent corroboration
- Mere suspicion that misconduct occurred is not enough.
Same obligation for bad judicial conduct
Out-of-State Lawyers
An out-of-state lawyer may practice in a jurisdiction in which the lawyer is not licensed on a temporary basis.
1) Pro hac vice admission
- there must be a DISPUTE (“vice”)
- Also applies to mediation and arbitration
2) Association with local counsel
- Local counsel must ACTUALLY participate; she can’t be a mere silent partner
3) Working for a client from home
- The attorney must have home-state qualification.
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Unauthorized Practice of Law
What is the practice of law?
- Any activity which develops facts or law
Unauthorized Practice of Law – What happens?
- Non-lawyers: injunction (e.g., “Stop doing that.”)
- Lawyers: Lose fees (e.g., lawer not qualified or licensed, practicing out of state)
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Assisting nonlawyers in unauthorized practice of law – In General, A lawyer must not assist a person in the unauthorized practice of law if the person is not a lawyer.
- Assisting Lawyer would be subject to discipline under the MRPC.
- However, the nonlawyer is not subject to MRPC, they would be subject to civil or criminal penalties
The Model Rules of Professional Conduct (MRPC) do not prohibit a Lawyer from….
1) Professional Advice to NON-Lawyer – Lawyer may provide professional advice to nonlawyer:
- whose employment requires legal knowledge or
- who is authorized to provide particular law-related services
2) Delegation to NON-Lawyer – Lawyer MUST:
- have client contact; and
- supervise nonlawyer’s delegated work and take responsibility for the work of the non-professional
3) Assisting Pro se litigants— Lawyer may assist individuals (NOT entities) who wish to proceed pro se
- Ghostwriting—a lawyer CAN engage in ghostwriting for pro se litigants.
Practice of law in unlicensed jurisdiction by lawyer admitted in another U.S. jurisdiction — Permitted if practice:
Temporary practice
- is conducted in association with local lawyer
- is reasonably related to pending or potential proceeding in jurisdiction where lawyer is or reasonably expects to be authorized to practice
- concerns mediation or arbitration arising from practice in admitted jurisdiction or
- otherwise arises out of or reasonably relates to practice in lawyer’s admitted jurisdiction
Permanent practice
- only involves providing services to lawyer’s employer / organizational affiliate OR
- is authorized by federal or local law
Exceptions—NOT PERMITTED if lawyer is:
- disbarred in ANY jurisdiction or
- suspended in ANY jurisdiction
Fee-Division with Non-Lawyers
A lawyer CANNOT divide legal fees with NON-LAWYERS
- Exceptions: Estates of decedent lawyer, retirement plans, etc.
- Legal fees are for legal work done by LAWYERS
Legal fees NO – General Revenue OK
- A lawyer may include a nonlawyer employee in a compensation or retirement plan only if payments from such a plan are made from the general revenue of the law office and may not be attributable to legal fees earned in a specific client matter.
Real firms may SPLIT FEES
- the entity must be a professional corporation.
No NON-LAWYER can be IN CONTROL of a lawyer’s judgment.
- 3rd party payors – e.g., insurance company is not the client
Lawyer-owned related services (e.g., document retention or delivery services)
- Clients must know they are not dealing with a lawyer.
Limitations on Association With Nonlawyers
The Model Rules limit the extent to which lawyers may form partnerships or associate with nonlawyers.
Partnership with Non-Lawyer
- PROHIBITED IF ANY of the activities of the partnership consist of the practice of law.
Professional corporation – A lawyer is not permitted to practice with or in the form of a professional corporation or association authorized to practice law for a profit, if:
- A NON-Lawyer owns any interest therein (except that a fiduciary representative of the estate of a lawyer may hold the stock or interest of the lawyer for a reasonable time during administration);
- A NON-Lawyer is a corporate director or officer thereof or occupies a position of similar responsibility in any form of association other than a corporation; or
- A NON-Lawyer has the right to direct or control the professional judgment of a lawyer.
Example:
- A law firm is organized as a professional corporation with five lawyer-shareholders. It would be improper for the office manager, who is not a member of the bar, to serve as the executive vice president of the law firm.
Sale of Practice
Sale of Practice
- May sell the whole practice or only one area
- Cannot increase the fees associated with the sale
The Lawyer MUST:
- STOP practice
- Give NOTICE to the client; and
- SELL practice to a LAWYER
Notice to Clients
- The written notice provided to the seller’s clients must inform each of them that a client’s consent to the transfer of the client’s files will be presumed if no action is taken by the client within 90 days.
Can the lawyer return to practice? Yes, if:
- In-house counsel
- Pro bono
- Different area of law
- Change in circumstances (e.g., illness, financial difficulty).
Agreements Restricting lawyer’s right to practice law
Prohibited – Lawyer subject to discipline for OFFERING or MAKING:
- partnership, employment, or similar agreement that restricts right to practice law after termination of relationship
- client settlement agreement restricting right to practice
- noncompete agreement that restricts right to practice or
- agreement with forfeiture-for-competition clause restricting right to practice
Permitted – Lawyer may restrict lawyer’s right to practice law in agreement concerning:
- RETIREMENT benefits or
- SALE of law practice
