WORKING DRAFT Proposed Rule 5.5 - Draft No. 3 - Center for Professional Responsibility

WORKING DRAFT - FOR USE BY ETHICS 2000 COMMISSION ONLY
1/27/00

Proposed Rule 5.5 - Draft No. 3
(for Discussion at February 2000 Commission meeting)

Material added to the current Model Rule is underlined. Deletions from the current Model Rule are struck through. Changes from prior draft are italicized.

RULE 5.5 - UNAUTHORIZED PRACTICE OF LAW

(a) A lawyer shall not (a) practice law in a jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction. ; or The following conduct does not violate this rule, regardless of the law of the jurisdiction in which the practice occurs:

(b) A lawyer admitted to practice in another jurisdiction, but not in this jurisdiction, does not engage in the unauthorized practice of law in this jurisdiction when:

(1) appearing pro hac vice before a tribunal in another jurisdiction or preparing for litigation in which the lawyer reasonably expects to be admitted pro hac vice;

the lawyer is authorized to appear before a tribunal in this jurisdiction by law or court order; or

(2) other than making appearances before a tribunal,

(i) when the a lawyer who is an employee of the client acts ing with respect to matters on the client's behalf or, in connection with the client's matters, with respect to matters on behalf of the client's , its other employees or its commonly owned organizational affiliates, other than making appearances in court; or

( 3 ii) the lawyer acts ing with respect to a particular matter s that arises out of or are is otherwise reasonably related to the lawyer's practice in a jurisdiction in which the lawyer is licensed admitted to practice; and or

( 4 iii) the lawyer acting in association is associated in a particular matter with a lawyer admitted to practice in th eis jurisdiction.

( c ) A lawyer shall not assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized practice of law.

Comment

[1] A lawyer may regularly practice law only in a jurisdiction in which the lawyer is admitted to practice. The practice of law in violation of lawyer licensing standards of another jurisdiction constitutes a violation of these rules , subject to important exceptions .

[2] In a litigated matter, a lawyer admitted to practice pro hac vice does not violate paragraph (a) because lawyers so admitted are subject to the control and supervision of the admitting court. The exception to paragraph (a) for lawyers employed by a client acknowledges that lawyer licensing standards seek primarily to protect clients against deception as to the training and expertise of particular lawyers; clients who employ lawyers are unlikely to be deceived about the training and expertise of those lawyers. The complexity of many matters on behalf of clients also requires that a A lawyer whose practice on behalf of a client includes practice in a jurisdiction in which the lawyer is admitted to practice ordinarily does not violate paragraph (a) by acting also be permitted to act on behalf of the client in other jurisdictions in matters arising out of or otherwise reasonably related to the lawyer's practice on behalf of the client. Finally, because association with a lawyer licensed to practice in a jurisdiction is likely to protect a client against insufficient training or expertise of any lawyer not so licensed, such association also protects the lawyer against a violation of paragraph (a).

[2] There are occasions in which a lawyer who is admitted to practice in another jurisdiction, but not in this jurisdiction, will engage in conduct in this jurisdiction under circumstances that do not create significant risk to the interests of their clients, the courts, or the public. Paragraph (b) identifies four situations in which the lawyer may engage in such conduct without fear of violating this Rule. Whether other conduct constitutes the unauthorized practice of law will depend on the circumstances.

[3] Lawyers not admitted to practice generally in the jurisdiction may be authorized by court order or other law to appear before certain tribunals. Under paragraph (b)(1), a lawyer does not violate this Rule when the lawyer appears before such a tribunal. Nor does a lawyer violate this Rule when the lawyer engages in conduct in anticipation of a proceeding, such as factual investigations and discovery conducted in connection with a litigation or administrative proceeding in which an out-of-state lawyer has been admitted, or in which the lawyer reasonably expects to be admitted.

[4] When lawyers appear or anticipate appearing before a tribunal, their conduct is governed by paragraphs (a) and (b)(1). Paragraph (b)(2) authorizes a lawyer to engage in certain conduct other than making appearances before a tribunal. For example, paragraph (b)(2)(i) recognizes that some clients hire a lawyer as an employee in circumstances that make it impractical for the lawyer to become admitted to practice in this jurisdiction. Given that these clients are unlikely to be deceived about the training and expertise of these lawyers, the lawyer may act on behalf of the client without violating this Rule. The lawyer may also act on behalf of the client's other employees or its commonly owned organizational affiliates, but only in connection with the client's matters.

[5] Paragraph (b)(2)(ii) recognizes that the complexity of many matters requires that a lawyer whose practice on behalf of a client includes practice in a jurisdiction in which the lawyer is admitted to practice also be permitted to act on the client's behalf in other jurisdictions in matters arising out of or otherwise reasonably related to the lawyer's practice on behalf of the client. This conduct may involve negotiations with private parties, as well as negotiations with government officers or employees, appearances in administrative or rule making proceedings for which pro hac vice admissions are unavailable, and participation in alternative dispute resolution procedures.

[6] Paragraph (b)(2)(iii) recognizes that association with a lawyer licensed to practice in this jurisdiction is likely to protect the interests of both the clients and the public. The lawyer admitted to practice in this jurisdiction, however, may not serve merely as a conduit for an out-of-state lawyer, but must be jointly responsible for the representation of the client. If the admitted lawyer's involvement is merely perfunctory, then both lawyers are subject to discipline under this Rule.

[2] [ 7] The definition of the practice of law is established by law and varies from one jurisdiction to another. Whatever the definition, limiting the practice of law to members of the bar protects the public against rendition of legal services by unqualified persons. Paragraph (b) does not prohibit a lawyer from employing the services of paraprofessionals and delegating functions to them, so long as the lawyer supervises the delegated work and retains responsibility for their work. See Rule 5.3.

[ 4 8 ] Lawyers may also provide Likewise, it does not prohibit lawyers from providing professional advice and instruction to nonlawyers whose employment requires knowledge of law; for example, claims adjusters, employees of financial or commercial institutions, social workers, accountants and persons employed in government agencies. Lawyers may assist independent non-lawyers authorized by the law of a jurisdiction to provide particular legal services, for example, paraprofessionals authorized to provide some kinds of legal services to the poor. In addition, a lawyer may counsel nonlawyers who wish to proceed pro se.

 

Proposed Rule 5.5 - Draft No. 3
Reporter's Observations

At its meeting in December, the Commission agreed with the direction of this Rule, but asked the Reporters to continue to work on the details.

TEXT

  1. Paragraph (b): Limitation to lawyers admitted to practice in another jurisdiction but not in this jurisdiction.
  2. Under the prior draft, the safe-harbor exceptions would extend not only to out-of-state lawyers engaging in conduct in the adopting jurisdiction, but also to in-state lawyers practicing in other jurisdictions that may not have adopted the same approach. The Reporter believes that principles of comity require the adopting jurisdiction to require its lawyers to comply with the law of another jurisdiction. Thus, the Reporter recommends that the exceptions be limited as set forth above.

  3. Paragraph (b): Restructuring to limit court appearances to paragraph (b)(i).
  4. The Commission agreed that court appearances should be governed by paragraph (b)(1) and therefore should be excluded from all of the other exceptions, not just the exception for in-house lawyers.

  5. Paragraph (b)(1): Expanding exception to include appearances before a "tribunal" when authorized by court order or by other law
  6. Several observers noted that in addition to pro hac vice appearances, lawyers are sometimes authorized by court rule or by statute to appear before various tribunals, such as federal courts and federal agencies. The Reporter is uncertain whether "tribunal" is sufficiently broad to include the kind of appearances that are authorized with respect to administrative agencies. The Reporters intend to offer a definition of "tribunal" in the Terminology section that will encompass adjudicative proceedings of an administrative agency. If lawyers are authorized to "appear" in non-adjudicative proceedings of such an agency, then we may need to amend the language used in this rule.

  7. Paragraph (b)(1): Moving language regarding conduct "in anticipation" of an appearance to the Comment

The Reporter believed that it made more sense to move this language to the Comment, but if the Commission disagrees, it can be moved easily back into the text.

    5.    Paragraph (b)(2)(i): limitation of representation of co-employees and affiliates

The Commission agreed that this exception should not extend to representation of co-employees or affiliates that is unconnected with matters of interest to the client, e.g., drafting a will or the sale of residential real estate.

    6.    Paragraphs (b)(2)(ii) and (iii): stylistic

These changes are stylistic and not substantive.

COMMENT:

[1] This Comment was revised to reflect the decision to limit the exception to conduct by an out-of-state lawyer in the adopting jurisdiction.

[2] The prior paragraph has been deleted and revised considerably. The present paragraph explains the concept of the "safe harbor" exceptions and states explicitly, as a Commission member requested, that the failure to include certain conduct within the exceptions does not necessarily mean that such conduct constitutes the unauthorized practice of law.

[3] This paragraph explains the rationale for paragraph (b)(1) and clarifies that the exception applies to conduct in anticipation of an actual appearance before a tribunal.

[4] This paragraph explains the structure of paragraph (b)(2) and then describes and gives the rationale for the exception related to in-house lawyers.

[5] This paragraph explains the rationale for paragraph (b)(2)(ii). An observer suggested the need for additional language clarifying that such conduct is not limited to transactional representation, but includes negotiations with state agencies and appearances before bodies in which no pro hac vice admission is available.

[6] This paragraph explains the rational for paragraph (b)(2)(iii). The last two sentences are taken from a South Carolina ethics committee opinion and are included in response to concern expressed by bar counsel that this exception could swallow the rule.

[7] & [8] Renumbered from the prior draft.

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