The practice of law is now highly mobile, with lawyers traveling to many locations in service of their clients. Some consider the temporary practice in a state (the "Host State") by an attorney licensed to practice in any other the state of the United States ("Home State") in service of a client to be the unauthorized practice of law ("UPL"). The purposes of this proposal are to legitimize certain existing practices in a way that least imposes upon attorney-client relationships and the practical aspects of modern legal practice; to provide notice of an intent to regulate such practices; and to minimize the regulatory and administrative burdens of compliance and enforcement. The proposal gives credit to the wishes of clients and their counsel, and is not intended to enhance revenues to the state.
The Proposed Rule:
Rule XXX(a) The Host State Supreme Court, in the exercise of its exclusive jurisdiction to define the practice of law and to prohibit the unauthorized practice of law within the Host State, adopts the following Rules, which shall govern proceedings concerning the unauthorized practice of law.
Rule XXX(b): The unauthorized practice of law shall not include the practice of law by an attorney who is not licensed in the Host State, but who practices law in the Host State and who is licensed to practice law in any other jurisdiction in the United States, and who is a member of the bar and in good standing in all courts and jurisdictions where he or she is admitted, unless such person:
(i) has established domicile in the Host State (without applying for and receiving admission to the bar by waiver or examination within [a reasonable period of time] following the establishment of such domicile); or
[Should a specific period be stated in the rule in order to give adequate notice of conduct that is prohibited; does "a reasonable period of time" give such notice? Perhaps reference to applying for admission within three months and receiving admission within nine months?]
(ii) has established a place for the regular practice of law in the Host State from which such person holds himself or herself out to the public as practicing the law of the Host State, [or solicits or accepts clients who reside in the Host State.]
[There is an issue under (b) regarding the lawyer who is admitted in State X and who may be domiciled in the Host State and/or establishes an office in the Host State from which the lawyer holds out himself or herself as practicing only the law of State X. This lawyer solicits or accepts clients residing in the Host State, representing or advising them solely on matters pertaining to the law of State X. Should this practice be allowed under these rules? See the discussion below under (c) regarding Home State-licensed attorneys domiciled in the Host State.]
Rule XXX(c): The unauthorized practice of law shall not include the practice of law by an attorney who is not licensed in the Host State, but who practices law in the Host State and who is licensed to practice law in any other jurisdiction in the United States, and who is a member of the bar and in good standing in all courts and jurisdictions where he or she is admitted, if such lawyer is associated solely with a person or entity in the capacity of an attorney or general counsel and has advised such person or entity of the status of his or her license, and has obtained the informed consent of such person or entity to continue to serve the person or entity notwithstanding the absence of a license issued by the Supreme Court of the Host State. Such informed consent may be given retroactively. [Another version of this rule would require an in-house counsel domiciled in the Host State to obtain admission to the Host State bar within a reasonable or specified period. As long as the Host State either does not provide for admission on motion or maintains discriminatory admission on motion based on the presence or absence of reciprocity in the lawyer’s Home State, such a requirement would place a very substantial burden on the movement of corporate counsel within larger companies. The argument for such a requirement centers on a belief that attorneys domiciled and practicing in the Host State in any capacity should be subject to all of the rules and regulations of Host State lawyers and should be members of the bar, whether or not they choose to participate in state or local bar activities. A possible solution is for a Host State to admit on motion lawyers meeting that state’s requirements for experience, good standing in the lawyer’s Home State, character, graduation from an accredited law school, etc., without regard to reciprocity, particularly if reciprocity is not a requirement of any of the UPL exceptions in these draft rules.]
Rule XXX(d): Attorneys or counselors at law not licensed in the Host State, who are licensed to practice law in any other jurisdiction in the United States, and who appear in any court of record or before any administrative hearing officer must also comply with any rules for admission before such court or hearing officer.
Rule XXX(e): Any individual who engages in the practice of law as authorized by Rule XXX(b-d), or who practices law in violation of Rule XXX(b-d) shall be subject to the Rules of Professional Conduct of the Host State and the Host State rules regarding attorney discipline and disability.
Synopsis.
A rule that permits persons licensed and in good standing elsewhere to practice temporarily in the Host State would legitimize existing practice, and recognize and provide notice of the power and intent to discipline lawyers not domiciled in the Host State.
Exclusive Authority.
The proposed Rule XXX assumes that the Supreme Court of the Host State (or, in some cases another regulatory body that controls the practice of law in the Host State) has the exclusive jurisdiction to define the practice of law and to prohibit the unauthorized practice of law within the Host State.
An essential element of the operation of these rules is the definition of the "practice of law," which will vary from Host State to Host State. For example, in a context not involving litigation, the touchstones of the practice of law may be, advice to a client about their rights and duties, and, where forms are concerned, advice in completing forms that is beyond the skills of the ordinarily experienced and intelligent layperson.
Currently in most states, UPL is the practice of law by nonlawyers. A nonlawyer is a person not licensed to practice law in the Host State. The proposed rule is intended to legitimize current practices of persons licensed and in good standing in the Home State and other jurisdictions in the U.S., while preserving current rules proscribing UPL by persons not licensed in the U.S.
Hypothetical Situations:
1. Lawyer not in good standing. A lawyer practices law in the Host State, is not licensed in the Host State, is licensed in the Home State but is not in good standing in one of the jurisdictions or courts before which she or he is admitted.
This lawyer is a nonlawyer engaged in UPL, just like a person who is not licensed in any jurisdiction, who engages in UPL in the Host State.
The following hypotheticals illustrate the application of this Rule for lawyers who are not licensed in the Host State, and who are in good standing in the Home State and all jurisdictions and courts in which they are admitted:
2. Out-of-state lawyer, out-of-state client. A lawyer comes to Host State on behalf of an out-of-state client in connection with a lawsuit in another jurisdiction, to interview witnesses or collect documents or facts, or to attend and conduct depositions.
This activity is authorized by Rule XXX(b) regardless of how many visits take place and how long the matter lasts. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
3. Out-of-state lawyer, Host State state court or Host State state administrative matter. A lawyer comes to the Host State on behalf of a client (the client may be in-state or out-of-state client) in connection with a lawsuit in state court, or before a state administrative agency in the Host State, and appears and handles the litigation.
So long as this lawyer obtained pro hac vice status, the activity is authorized, and this lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(d). Lawyers who appear in federal court are governed by other rules.
4. Out-of-state lawyer conducts alternative dispute resolution in the Host State. The client may be from the Host State or from out of state. An out-of-state lawyer collects evidence, takes depositions, or conducts a mediation or arbitration as an advocate or as a mediator or arbitrator, all or in part in the Host State.
This lawyer cannot obtain pro hac vice admission. This activity is authorized by Rule XXX(b) regardless of how many visits take place and how long the matter lasts. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
5. Out-of-state lawyer handles transaction in the Host State. An out-of-state lawyer, at the request of the client (the client may be from the Host State, or from out –of state), visits the Host State, and negotiates and closes a purchase and sale contract (stock, real property, etc.).
This activity is authorized by Rule XXX(b) regardless of how many visits take place and how long the project lasts. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
6. In-house counsel. Lawyer moves to the Host State, establishes domicile, takes full time job at an organization with an office in the Host State as associate general counsel.
This lawyer is in technical violation of Rule XXX(c) for having failed to obtain the informed consent of his or her client to practice law in the Host State without a Host State license. The lawyer can establish compliance, even retroactively, by obtaining consent of the client after the fact. Such consent must be informed, but need not be in writing.
A lawyer not licensed in the Host State who takes an in-house position essentially assumes the risk that his or her client will consent after the fact.
Once consent is obtained, this activity is authorized by Rule XXX(c) regardless of how long the lawyer resides in the Host State, and regardless of the fact that the lawyer established domicile in the Host State. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
If the lawyer provides legal advice or services for other clients (including legal advice or services on personal matters for officers or employees of the organization with which the lawyer is exclusively associated), the lawyer violates Rule XXX (c). This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
7. Host State resident. A lawyer, domiciled outside of the Host State, has a second home in the Host State, where the lawyer has a place to work (which may or may not be thought of as a home office), and where the lawyer does legal work when staying in the Host State home. The lawyer serves clients from the state of his or her domicile while in Host State.
This activity is authorized by Rule XXX(b) regardless of how much time is spent practicing in the Host State residence (so long as domicile is not established in the Host State). This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
If the lawyer meets in her or his Host State residence with clients from out of state, on out-of-state matters, or on matters pertaining to Host State law, the activity is authorized under Rule XXX(b), and, the lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
8. Host State temporary resident, practice includes Host State law. A lawyer, domiciled outside of the Host State, has a second home in the Host State, where the lawyer has a place to work (which may or may not be thought of as a home office), and where the lawyer does legal work when staying in the Host State home. In addition to handling matters for clients from his or her state of domicile while visiting the Host State, the lawyer takes on work for local persons he or she became acquainted with while in the Host State.
The legal work for the Host State client is UPL under Rule XXX(b)(ii) regardless of how infrequent the practice may be. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
If the lawyer were to post signage, issue business cards or advertise in the Host State, which in any way indicates the lawyer is available for consultation on the Host State law, the UPL status is exacerbated.
9. Out-of-state lawyer, Host State office. A lawyer domiciled outside of the Host State is associated with a law firm that has a Host State office. The lawyer comes to the Host State office to assist on a matter in the Host State, at the request of the Host State client or the firm’s Host State office.
This activity is authorized by Rule XXX(b) regardless of how much time is spent practicing in the Host State (so long as subparts (i) or (ii) are not violated). This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
10. Out-of-state lawyer, Host State office of multi-lawyer firm. A lawyer domiciled outside of the Host State works in an office outside of the Host State, and is associated with a law firm that has a Host State office. The lawyer comes to the Host State office to assist in developing the firm’s practice in a particular area of the law. The lawyer meets with potential clients, conducts marketing presentations, entertains the potential Host State clients, and assists the Host State lawyers in developing the relationship with the potential clients. One of the potential clients hires the firm with the expectation that the lawyer and others in the Host State office will work on the client’s Host State matter. The lawyer does not maintain regular or permanent office space in the firm’s Host State office, and does not state that she or he works in the Host State office. Rather, the lawyer makes it clear that she or he is based in the firm’s office where the lawyer is domiciled.
This activity is authorized by Rule XXX(b) regardless of how much time is spent practicing in the Host State. The lawyer does not violate Rule XXX(b)(ii) because the lawyer does not regularly practice law from the Host State office, and does not hold her or himself out as practicing from the office, rather, the lawyer clearly states to potential clients that the lawyer is based in the office in the state of domicile. This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
On the other hand, if the lawyer maintains an office in the Host State office of the firm, and regularly practices there, Rule XXX(b)(ii) is implicated, and the lawyer should obtain admission to the Host State Bar. This UPL would be exacerbated by the lawyer’s engaging in marketing activities based out of the Host State office, or accepting new clients at the Host State office.
11. Out-of-state lawyer, Host State office. A lawyer domiciled outside of the Host State works in an office outside of the Host State and has an office in the Host State as well.
If, in the Host State office, the lawyer works only on out-of-state (including foreign law matters) or federal matters, and does not solicit or accept new Host State clients, or hold himself or herself out to the public as practicing Host State law from that office, the activity is authorized under Rule XXX(b).
If the lawyer established the office to handle matters of Host State law for an existing Host State client, and did nothing in the way of marketing or solicitation to obtain new Host State clients from the Host State office, then Rule XXX(b)(ii) is not violated.
If the lawyer, notwithstanding a lack of marketing or promotion, nevertheless attracts new Host State clients, the lawyer may not accept the new Host State clients in the Host State office without violating Rule XXX(b)(ii).
This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
12. Host State domicile, Host State office, out-of-state practice. A lawyer licensed elsewhere, domiciled in the Host State, works in an office in the Host State, and serves only out-of-state clients in a specialized area of the law.
This lawyer must become a member of the Host State Bar, pursuant to Rule XXX(b)(i). This lawyer is subject to the Host State Rules of Professional Conduct and discipline pursuant to Rule XXX(e).
13. Conflicting ethics rules. A lawyer, not licensed to practice in the Host State, but authorized to practice in the Host State pursuant to Rule XXX, faces a dilemma resulting from inconsistent or conflicting ethics rules between the Host State and the state of licensure. For example, there may be conflicting rules on advertising, fee-splitting, or contingent fees.
These conflicts will be resolved pursuant to regular rules of conflicts of laws, as if the lawyer was licensed in both jurisdictions.
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