Legal Ethics: Unit 2

UNAUTHORIZED PRACTICE OF LAW

Why should the practice of law be limited to lawyers?

They are licensed after satisfying certain state requirements of education, moral character, and understanding of the law

What does UPL stand for?

Unauthorized Practice of Law

When does this occur?

When the person is seeking legal advice from a person who he knows has legal knowledge but who is not a lawyer

What are the two suppositions of UPL regulation?

(1) The public is best served by maintaining the high standards of quality achieved by self-regulation of the legal profession (2) Only licensed lawyers are subject to regulation under the ethical considerations

Are there are states that are extending the right to undertake tasks that we used to call “practicing law” to non-lawyers?

Yes but in limited circumstances

What determines the activities that constitute the unauthorized practice of law? 

They are subject to the interpretation of each state

What major problem does this cause?

There is no universal standard and as our society needs more legal advice and more people can’t afford it

Historically, what circumstances are considered by the courts in determining if there has been unauthorized practice whether an unlicensed person is engaged in an activity?

• One traditionally practiced by lawyers;

• One “commonly understood” to involve the practice of law;

• Requires legal skill or knowledge beyond that of a layperson;

• Characterized by the personal relationship between lawyer and client; or

• When public interest is best served by limiting performance to those who are lawyers

Rules:

 What is Model Rule 5.5?

A lawyer shall not:

(a)Practice in a jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction; or

(b)Assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized practice of law.

What is the significance of ABA Model Code EC 3-5?

It states that it is neither necessary nor desirable to attempt the formulation of a single specific definition of what constitutes the practice of law.

Who are served by the Model Rules?

Lawyers by telling them not to practice law in any jurisdiction where they can’t

Can a lawyer who is licensed in State A practice law in State B?

Not unless the lawyer gets permission from a State B court to practice before it, if not, the lawyer is committing UPL

What if the lawyer was licensed in State A but has been suspended or disbarred and continues to practice law in that state?

That constitutes UPL

What is the NFPA Model Code?

It admonishes only that each paralegal is responsible for complying with legal authority governing the unauthorized practice of law in his or her jurisdiction

How does NALA’s position differ from NFPA’s position on UPL?

NALA is stricter than that of NFPA because of the difference in their definitions of what a paralegal is

How does NALA view the paralegals or legal assistants?

You are only a paralegal if you are assisting a lawyer

How does this contrast to NFPA’s definition of a paralegal?

This person may be retained or employed by a lawyer, law office, governmental agency or other entity or may be authorized by administrative, statutory or court authority to perform this work. The NFPA definition leaves room for what was once called a “legal technician”

(i.e., a non-lawyer who delivers legal services directly to the public) because it does not require that the legal work be performed at the behest of a lawyer

What are some examples of unauthorized practice of law for a paralegal?

• Giving legal advice

• Creating legal documents

• Representing others in court

How would you commit UPL by giving legal advice?

The application of a rule of law to a specific person’s fact pattern and giving an opinion or conclusion when you are not a lawyer

There are, of course, exceptions to the prohibition on the practice of law by non-lawyers;

Give some examples:

Self-representation - The right of self-representation in federal courts Law students - The California Supreme Court held in 1979 that valuable practical training and increasing the availability of legal services for indigent people were strong enough reasons to permit “limited practice of law” by law students, providing they are properly supervised.  States vary immensely as to in what area and under what circumstances law students may practice law 

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Administrative agencies An overwhelming majority of federal agencies permit lay representation

(i.e. National Credit Union Administration, Food and Drug Administration, Immigration and Naturalization Service)

Do states have authority to say who can represent others before federal agencies?

No

There are activities that are incidental to activities typically conducted by non-lawyers that are not considered the unauthorized practice of law, what is the rule?

Activities performed by lay people in the course of business that would ordinarily be considered the practice of law but are incidental to functions properly performed by them are exempt from UPL prohibitions

What is the conduit theory in ‘giving legal advice’?

The paralegal is simply acting as a conduit of the legal advice from the lawyer to the client such as “call client X and tell her…. Or if the lawyer had written the advice in a letter and sent it to the client

What should the paralegal do if he/she has been instructed in what to say to one client in one circumstance and would now like to give that same advice to a different client in a similar circumstance?

In certain circumstances, it may be perfectly all right to give the advice to the client and in others it may not.

Yet in other circumstances, it may be acceptable to say, “This is what I think the answer is, but I’m going to check with a lawyer and if the answer isn’t right, I’ll call you back.”

There are kits available to help you with a divorce and, at most, offer only general advice on common problems for simple divorces, so they cannot constitute the unauthorized practice of law.

How would these kits become UPL?

If there was giving legal advice given to specific individuals in conjunction with the sale of the kit, then UPL was committed

Corporations present a special problem because they are not “persons” as we traditionally think of them.

Can corporations utilize the right of self representation?

They cannot

Why do some states permit non-lawyer employees to represent a corporation?

Because small claims court is a place where non-lawyers should be litigating, not lawyers

Paralegals working in corporations face interesting UPL problems, why?

They are typically not working under the supervision of lawyers

An employee of a corporation doesn’t really have a “client” in the typical sense of the word—just other employees.

If legal advice is given, is it UPL?

No, to commit UPL, the offender has to have a client

Both lawyers and non-lawyers can make mistakes that ultimately harm the client but what is the difference?

(1) Lawyers have the authority to correct the error;  (2) Lawyers can be sued for professional negligence whereas most non-lawyers cannot; and

(3) Where there is a pattern of below-standard legal work, lawyers may be subject to discipline but non-lawyers are exempt from state bar disciplinary actions.

How can lawyers violate the regulations that prohibit their aiding the unauthorized practice of law?

1. Improperly supervising their employees and associates (including improper delegation),

2. Entering into an improper business relationship with a non-lawyer (including splitting fees), or

3. Allowing (or helping) a non-lawyer to misrepresent the non-lawyer status

If you are asked to write responses to interrogatories but your draft is never reviewed by a lawyer, what has taken place?

The lawyer who failed to review your work just helped you commit UPL

Can a lawyer ask the paralegal to sign his name to a pleading?

No, only lawyers can

What if the paralegal is asked to do so?

It is the responsibility of the non-lawyer to say “no” to a lawyer who tries to delegate an improper task

What is an improper division of fees and how is it UPL?

Legal decisions are supposed to be made by lawyers as they are “trained in the law and bound by the rules of professional responsibility.”

If a non-lawyer has the opportunity to be paid part of the fee from a case, he might be tempted to solicit clients or engage in UPL. Paying a paralegal a percentage of legal fees is “fee splitting.”

Can the paralegal receive a bonus?

If it is not based on a percentage of law firm profits or on a percentage of particular legal fees

Does it impact “profit-sharing” plans such as 401Ks or other compensation or retirement plans?

It does not so long as the amount of money doesn’t appear to be tied to one case.

*Splitting annual profit is okay but splitting the profit from one case is not

What is a multidisciplinary practice?

A partnership, professional corporation, or other association that includes lawyers and non-lawyers and that provides both legal and non-legal services

What about multidisciplinary practices, do they split fees?

At present, the ethics and unauthorized practice of law rules in every state (except the District of Columbia) forbid lawyers from sharing fees or entering partnerships with non-lawyers

What are some general guidelines that help ensure non-lawyers will not be mistaken for lawyers?

1. Paralegals have responsibility for identifying themselves as non-lawyers while lawyers do not have any obligation to tell people they are lawyers 2. Paralegals can have business cards identifying them as being employed by a law firm or other entity but, again, the card must identify them as a paralegal or legal assistant.

(Make sure that your business card does not imply that you are an “associate” with the firm.)

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3. Most states allow paralegals to sign correspondence to clients on firm stationery when the letter contains no legal advice and when the letter is a standard one. Your designation or title should always follow your name. 4. Paralegals can be listed on letterhead stationery in some jurisdictions when accompanied by the paralegal designation 5. Paralegal names cannot be listed on the door of the office or in advertisements for the firm in most states

What are the most widely used methodsof enforcement of the unauthorized practice regulations?

Injunction, criminal prosecution, citation for contempt of court, and writs of quo warranto

What is Quo warranto?

Latin for “by what authority”

Why have some states increased the level of UPL to felony?

To show how serious they are about clamping down on illegal practices

Quo warranto writs are used to restrain corporations from doing what?

Exceeding their chartered purposes

Who is in charge of initiating the proceeding for an injunction?

Many states allow suits by the integrated bar. Those states that allow class actions by lawyers require a showing of irreparable injury or some proof that the lawyers represent the public interest.