April 14, 2015 article

ABA Clarifies Inconsistent Interpretation of Sale of Law Practice Rules to the Benefit of Sole Practitioners

By William Knight

Should attorneys ever break a professional rule in order to comply with its spirit? Thankfully, Formal Ethics Opinion 468, published in October 2014, resolved one such ethical Catch-22 to the benefit of sole practitioners selling their practices under Rule 1.17 of the Model Rules of Professional Conduct. The recent opinion clarifies that selling attorneys may assist buyers for a reasonable period of time despite Rule 1.17's clear contemporaneous retirement clause.

Rule 1.17 was originally promulgated both to remedy another disparate treatment of sole practitioners and to protect their clients. Prior to 1990, the concept of sellinga law practice was unheard of. At the time, attorneys could benefit from goodwill of their careers with ethically permissible retirement plans, drawing from their former partners' assumption of their practice without running afoul of the rules prohibiting fee splitting with "non-lawyers." See Stocc M. Schoenwald, Model Rule 1.17 and the Ethical Sale of Law Practices: A Critical Analysis, 7 Geo. J. Legal Ethics 395, 402 (1994); 1 Geoffrey C. Hazard, J.r. & W. William Hodes, The Law of Lawyering ยง 21.2 (3d ed. 2013). Sole practitioners, on the other hand, were without recourse because they did not have partners and could not sell their practices. Naturally, many clients of sole practitioners who retired or passed away during representation were abandoned.

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