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Divided ABA Passes Resolution to Aid Justice Gap, Allow More Nonlawyers to Provide Legal Services

A divided American Bar Association has passed a resolution to create model rules for states that want to license non-lawyers to provide legal services. On one hand, the measure would allow more states to follow the lead of Washington and Utah in allowing non-attorneys to help pro se litigants in some types of matters and in trying to close the access to justice gap. On the other hand, some lawyers, including the leaders of the ABA's Solo, Small Firm and General Practice Division, think that the measure could cost solo practitioners clients and their livelihood. Michael Bologna, writing on Forbes, says that the ABA adopted "10 standards states should incorporate into licensing rules, professional certification processes and training curriculums being created for non-attorney legal professionals." William Johnston, head of the Delaware Bar Association, said, "'There are substantial unmet legal needs that are not being met by members of the organized bar,"' The Am Law Daily's Susan Beck reports.

Utah Approves New Legal Profession to Close Justice Gap

The Utah Supreme Court has approved a new legal profession: limited paralegal practitioners, The Salt Lake Tribune's Jessica Miller reports. The new legal professional category has been created to help more citizens access the justice system.

The LLPs could assist clients outside of the courtroom--but not inside--by filling out forms, representing clients in mediations or preparing settlements.

Utah Supreme Court Deno Himonas told Miller "'we need to come up with an economically viable model that will help improve access for those individuals in our civil justice system."'

Washington state has started a similiar intiative to use non-lawyers to help close the justice gap.

Lawyers With Out-of-State Practices Can Run Afoul of UPL Rules

Submitted by Amaris Elliott-Engel on Tue, 11/17/2015 - 07:53

I wrote a piece for the Connecticut Law Tribune about how telecommuting and taking conference calls from home can make lawyers run afoul of the unauthorized practice of law rules:

There are probably hundreds of lawyers who are licensed in New York and living in Fairfield County in Connecticut. It's become commonplace for these attorneys to log onto their home computers to work on legal documents on behalf of New York clients, to participate in late-night video­conferences from home, or to conduct other business as their commuter train rolls through Norwalk.

But now some lawyers are quietly voicing concerns that under Connecticut Practice Book rules they may be engaged in the unauthorized practice of law (UPL) if they live in Connecticut but are licensed exclusively in New York. One attorney recently told the Law Tribune he made sure to get sworn into the Connecticut bar because he has a home office in Greenwich out of which he serves New York clients.

So are lawyers with virtual offices in Greenwich violating Connecticut's Rules of Professional Conduct? How about someone who regularly telecommutes from a Stamford apartment and takes Metro-North to a Manhattan law firm only once a week? Does the definition of practice of law in Connecticut conflict with the modern realities of lawyering through videoconferencing and email?

"The Rules of Professional Conduct are lagging behind [technology]," said Dove A.E. Burns, a partner at Goldberg Segalla whose professional liability defense practice includes lawyers as clients.

Under Connecticut rules, "the practice of law is ministering to the legal needs of another person and applying legal principles and judgment to the circumstances and objectives of that person." Leslie Levin, a University of Connecticut School of Law professor who studies the legal profession and lawyer discipline, acknowledges that Connecticut does have a "very wide definition of what constitutes the practice of law," meaning that many work-related tasks a New York lawyer might perform from a Connecticut residence could be construed as practicing law.

Levin said that read in a commonsense way, the rule governing UPL, Rule 5.5, is addressing legal advice offered to Connecticut residents. But if it's taken literally, according to attorneys with expertise on ethics issues, many lawyers may be violating the rule. The good news, it would seem, is that disciplinary officials probably will not coming after them anytime soon.

There's no doubt attorneys can run afoul of the disciplinary rules if they are regularly giving advice to clients in a state in which they don't have a true presence, even if as a practical matter they only live a few miles across the border, said Burns. She pointed out that the Delaware Supreme Court recently suspended an attorney from practicing law for two years because he worked out of his home in Pennsylvania. His Delaware presence was a commercial space where his landlord's receptionist did little more than greet visitors and collect the attorney's mail.

Connecticut's UPL rule clearly bars attorneys from making false claims about their licensing status. You "can't hang up a shingle in Connecticut and hold yourself out as authorized to practice law in Connecticut," said Marcy Tench Stovall of Pullman & Comley, who represents attorneys in malpractice litigation and disciplinary matters.

From there, however, the matter becomes more nuanced, raising "philosophical questions," said Stovall, that lead lawyers to parse the meaning of words such as "continuous" and "temporary."

Consider this: In Connecticut, an attorney, even while just giving advice to clients in New York under his New York license, could violate Rule 5.5(b) of the Rules of Professional Conduct, Stovall said. Rule 5.5(b)(1) bans lawyers licensed in other states from establishing a "systematic and continuous presence" in Connecticut in order to practice law.

However, there is a "safe harbor" rule for attorneys licensed in New York or other jurisdictions and who are practicing law in Connecticut only a "temporary" basis. The safe harbor applies, according to the rule, if the lawyer is providing services that arise "out of or are substantially related to the legal services provided to an existing client of the lawyer's practice or in a jurisdiction in which the lawyer is admitted to practice."

But a Connecticut-dwelling attorney doing work for non-Connecticut clients technically could be breaking the rule if they regularly work at home or on their commute through Fairfield County on the way to New York.

"If you read the rule literally, you wouldn't be practicing law on a temporary basis and [thus] not entitled to the safe harbor," Stovall said. She added that, given the ease of long-distance communications in the Information Age, it would be an "absurd result" if a lawyer was disciplined for sitting in a Connecticut home and offering counsel to a New York client. That is a "reflection of how the rules can't keep up with how people practice," she said.

Mark Dubois, who was Connecticut's first chief disciplinary counsel and is now counsel at Geraghty & Bonnano in New London, noted that the Rules of Professional Conduct are based on a 19th-century world in which lawyers were representing clients in the same town. In that era, he said, attorneys from Hartford would never even be representing clients from New Haven, much less New York.

Dubois said many bar regulators judge UPL matters simply by applying the "where-is-your-butt" test. In other words, UPL is determined if an attorney is physically located in a place where he or she is not licensed to practice.

But Dubois said a small number of states have given regulators more flexibility to make judgment calls. Among them is Arizona, he said, where a regulator might try to distinguish between attorneys giving advice about Arizona law when they're not licensed in Arizona, and attorneys who happen to be temporarily staying in a Tucson hotel room who log into their New London computers and give advice to Connecticut clients.

Moving forward, he said, questions for regulators investigating possible UPL violations will include: "Where are you when you're doing [legal work]? Are you where the client is? Where is the predominant effect of your conduct felt? Is it where you are physically?"

While an attorney could be violating UPL rules while doing legal work on a business trip, regulators are unlikely to spend the effort to discipline them, Dubois said. He said they are more concerned about protecting consumers from attorneys who don't know what they're doing and from having their money stolen by dishonest lawyers.

Burns, who commutes from her home in Wilton to a Goldberg Segalla office in midtown Manhattan, agrees that attorneys who rely on technology to do business away from their formal law office have more pressing challenges than aggressive disciplinary officials.

If faced with a professional malpractice lawsuit, she said, lawyers run the risk that they could be violating their insurance policy's "standard of care" clause because they are giving advice about the laws of a state that they don't often work in. A malpractice insurance provider isn't going to like it if an attorney isn't keeping up with the practice of law in the state where she is licensed because she often practices from a remote locations, Burns said.

Then there's the whole matter of cybersecurity. A data breach of confidential information caused by accessing files from an out-of-office location poses a significant liability concern. Lawyers, said Burns, are responsible for maintaining client confidentially "regardless of the pitfalls and failings of technology." 

Conn. Ethics Panel OKs Barter of Legal Services

Submitted by Amaris Elliott-Engel on Sun, 10/25/2015 - 23:02

Here's my latest piece for the Connecticut Law Tribune:

Connecticut lawyers can now be paid by clients for their services in chickens and eggs. Well, not quite.

But an opinion issued by the Connecticut Bar Association's Standing Committee on Professional Ethics seems to have opened the door for lawyers to engage in barter.

The committee was asked to offer an opinion on whether an attorney may barter his or her legal services as part of a clearinghouse in which the members exchange goods and services. In this barter exchange program, the attorney is paid in "barter currency," which can be used to purchase goods and services from other members in the exchange. Attorney members and non-attorney members alike also must pay membership dues to such programs.

The opinion, which was drafted this past summer by three members of the CBA committee before it was ultimately approved by a majority of the committee, says that attorneys can ethically participate in barter exchange programs. But there are some limitations.

Marcy Tench Stovall, committee chairwoman and counsel at Pullman & Comley, said the main takeaway from the opinion for a lawyer admitted to practice in Connecticut is that "it's permissible for a lawyer to be paid through a barter exchange, but they have to comply with the all the relevant rules of professional conduct."

Those caveats include that attorneys participating in a barter exchange have to have a written engagement agreement, including spelling out that barter currency will be used as the compensation for legal services. "The cardinal principle governing a lawyer's fee still applies: the fee must not be unreasonable, regardless of form of payment," the opinion says.

A lawyer's participation in a barter exchange still has to comply with all applicable rules for attorney confidentiality, client solicitation and advertising, Stovall said. As a result, any ads published by the barter exchange about an attorney participating in the program must be true and not misleading, according to the opinion.

So what might a lawyer trade legal services for on such an exchange? Exchange Enterprises, which bills itself as "Connecticut's longest trusted barter company," offers everything from acupuncture treatments and small appliance parts to wigs and wedding consulting. Legal services aren't listed among the categories, but other professions such as accounting, opthalmology and sports medicine are represented., a national barter website, includes postings from a number of lawyers. One Dallas practitioner is willing to draft wills and contracts in exchange for landscaping work that includes building a retaining wall. An Ohio attorney is offering "generic legal services and consultation" in exchange for a used car. And a California legal provider is offering civil or family law document preparation in exchange for professional photography services.

Kimberly Knox, a partner at Horton, Shields & Knox who has a practice focusing on professional disciplinary matters, said the committee's opinion "shows that the profession is becoming more flexible" and responsive to clients who may want to compensate their lawyers in non-traditional ways.

Karen Rubin, who is counsel with Thompson Hine's Cleveland office with a practice focusing on professional responsibility, wrote a column in October about the bar opinion on the Lexology website. She noted that barter exchanges have been growing around the country so much so that there is now a trade group, the National Association of Trade Exchanges.

Ethics opinions issued by the American Bar Association and from Massachusetts and California in the 1970s suggested it was improper for attorneys to participate in barter exchange agreements. More recently, ethics opinions from New York, Utah and North Carolina have found it ethical for a lawyer to participate in a barter exchange program if certain requirements are met.

"Bar regulators are extremely cautious by nature and they want to advance the interpretation of ethics rules step by step," Rubin said. "This opinion actually represents a friendlier attitude, a change in attitude, toward barter exchange agreements because … some previous ethics opinions, including from the American Bar Association, were very hostile to the idea of barter exchange arrangements."

The CBA opinion says that attorneys must preserve their independent professional judgment and keep the sole authority to accept matters if they are participating in a barter exchange program. The barter exchange also must not have any influence over the legal services provided through the clearinghouse, and the barter exchange must not be entitled to information about the representation of the client.

The committee also found that a lawyer's participation in a barter exchange program doesn't violate the rules against sharing legal fees with non-lawyers. The committee further opined that litigation expenses can only be paid in advance for legal services if there is a written fee agreement.

Rubin noted that other jurisdictions may not be able to follow Connecticut's lead in allowing attorneys to participate in barter exchanges. She questioned how a barter transaction would work in states where legal fees paid in advance must be put into a client trust account.

In her column, Rubin further said "there might be issues in a barter transaction where a lawyer receives plumbing services immediately, but 'pays' with legal services that will stretch out over an extended period of time: are the plumbing services advance fees, and how will they be 'withdrawn' only as earned?"

Mistrial Declared in Dewey & LeBoeuf Criminal Trial

A mistrial was declared today in the trial of former executives at a leading white shoe law firm that melted down amid financial irregularities and partner defections, Reuters' Brendan Pierson reports. The New York Supreme Court jury said it was hopelessly deadlocked on charges against former Dewey & LeBoeuf Chairman Steven Davis, Executive Director Stephen DiCarmine and Chief Financial Officer Joel Sanders, "including grand larceny, scheme to defraud and violating New York's securities law, the Martin Act."

The jury deliberations--at 22 days--are believed to be the longest in the state's history.

Connecticut Supreme Court Rejects Regulation of Debt Negotiation Law Firms

The Connecticut Supreme Court has struck down a state law that gave the Department of Banking authority to regulate law firms engaged in debt collection, The Connecticut Law Tribune's Christian Nolan reports.

The Supreme Court ruled that only the judiciary can regulate the conduct of law firms. The law limited the fees that law firms could charge and required law firms to pay $800 annual licenses for helping consumers renegotiate credit card debt.

Opinion: China Poses Moral Dilemma for American Bar Association

Robert Edward Precht, opining in The Washington Post, said that China is posing a moral dilemma for the American Bar Association because of its recent crackdown on human rights lawyers. He criticizes the ABA for not impugning a recent crackdown on lawyers in China and for its vote against making a statement at the annual meeting in August against the crackdown. Opponents argued that Beijing might close the ABA office in China if the organization officially criticized the treatment of human rights lawyers. Precht says the ABA can change course and call "on the authorities to immediately release the wrongfully arrested activists and to make clear that they are not at risk of torture and other ill treatment. China’s beleaguered civil rights lawyers deserve no less."

Closing Legal Services Gap Means Moving Beyond 'Access to Justice'

Dan Lear, director of industry relations for Avvo, writes on The New Normal Blog that lawyers need to move beyond "access to justice" initiatives to close the legal services gap because they are "entirely ineffective." He also notes that, under the traditional access to justice model, clients get one-on-one attention from attorneys, but this is inefficient. Moreover, some clients of modest means can afford to pay something and often have better access to technology and other resources "that would help them self-educate, receive unbundled legal services delivered partially or fully though technology or online, or navigate the legal system with only limited guidance from an attorney."

Associate Who Lost Out on Partnership Loses Discrimination Suit

A former associate at Ropes & Gray was unable to revive his racial discrimination lawsuit after a ruling by the U.S. Court of Appeals for the First Circuit, The National Law Journal's Sheri Qualters reports. John Ray III alleged that he was racially discriminated against and fired because he complained about racial remarks made by the firm's parnters.

The firm told him in 2008 that he would not make partner and gave him six months to leave. The Equal Employment Opportunity Commission found that the firm didn't discriminate against Ray, but did retaliate against him for filing a charge with the EEOC.

Are Lawyers Getting Dumber?

Last week, BloombergBusiness' Natalie Kitroeff had a piece with a title sure to grab your attention: "Are Lawyers Getting Dumber?" However, the piece is really about a stupendous drop in the rate of law school graduates who are passing the bar exam. For example, bar passage rates dropped by 9 percentage points or more in Delaware, Iowa, Minnesota, Oregon, Tennessee and Texas in 2014.

National Conference of Bar Examiners' Erica Moeser says the student body that sat for the July 2014 exam were less prepared than the body that sat for the July 2013 exam. She told Kitroeff "underqualified law grads don’t deserve to pass the bar just because they earned a J.D. Her role, she says, is to protect consumers."

However, some critics point to the glitch in the ExamSoft software that cause thousands of test takers to get error messages when trying to upload their exams in 2014. Yet pass rates were down across the board in states that used ExamSoft and those that didn't, Kitroeff reports.

Moeser also argues that law schools have lowered their standards to admit students who aren't going to qualify for the bar: "''You’ve got this underclass in law schools who are really keeping the lights on but not reaping the benefit.'"


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