Ethics 20/20 Proposed New Model Rule on Practice Pending Admission

ABA Model Rule on Practice Pending Admission 

1.   A lawyer currently holding an active license to practice law in another U.S. jurisdiction may provide legal services in this jurisdiction through an office or other systematic and continuous presence for no more than [365] days, provided that the lawyer:

    a. is not disbarred or suspended from practice in any jurisdiction and is not currently subject to discipline or a pending disciplinary matter in any jurisdiction;

    b. has not previously been denied admission to practice in this jurisdiction or failed this jurisdiction’s bar examination;

    c. notifies Disciplinary Counsel and the Admissions Authority in writing prior to initiating practice in this jurisdiction that the lawyer will be doing so pursuant to the authority in this Rule;

    d. submits within [60] days of first providing legal services in this jurisdiction a complete application for admission by motion or by examination;

    e. reasonably expects to fulfill all of this jurisdiction’s requirements for that form of admission;

    f. associates with a lawyer who is admitted to practice in this jurisdiction;

    g. complies with Rules 7.1 and 7.5 of the Model Rules of Professional Conduct [or jurisdictional equivalent] in all communications with the public and clients regarding the nature and scope of the lawyer’s practice authority in this jurisdiction; and

    h. pays any annual client protection fund assessment.

2.  A lawyer currently licensed as a foreign legal consultant in another U.S. jurisdiction may provide legal services in this jurisdiction through an office or other systematic and continuous presence for no more than [365] days, provided that the lawyer:

    a. provides services that are limited to those that may be provided in this jurisdiction by foreign legal consultants;

    b.  is a member in good standing of a recognized legal profession in the foreign jurisdiction, the members of which are admitted to practice as lawyers or counselors at law or the equivalent, and are subject to effective regulation and discipline by a duly constituted professional body or a public authority;

    c. submits within [60] days of first providing legal services in this jurisdiction a complete application for admission to practice as a foreign legal consultant;

    d. reasonably expects to fulfill all of this jurisdiction’s requirements for admission as a foreign legal consultant; and

    e. meets the requirements of paragraphs 1(a), (b), (c), (f), (g), and (h) of this Rule.

3.  Prior to admission by motion, through examination, or as a foreign legal consultant, the lawyer may not appear before a tribunal in this jurisdiction that requires pro hac vice admission unless the lawyer is granted such admission.

4.  The authority in this Rule shall terminate immediately if the lawyer’s application for admission by motion, by examination or as a foreign legal consultant is denied prior to [365] days or if the lawyer fails to file the application for admission within [60] days of first providing legal services in this jurisdiction.  Upon the termination of such authority the lawyer, within [30] days, shall:

    a. cease to maintain a presence or occupy an office for the practice of law in this jurisdiction unless authorized to do so pursuant to another Rule;

    b. notify all clients being represented in pending matters, and opposing counsel or co-counsel of the termination of the lawyer’s authority to practice pursuant to this Rule;

    c. not undertake any new representation that would require the lawyer to be admitted to practice law in this jurisdiction;

    d. take all other necessary steps to protect the interests of the lawyer’s clients.

5.  Upon the denial of the lawyer’s application for admission by motion, by examination, or as a foreign legal consultant, the Admissions Authority shall immediately notify Disciplinary Counsel that the authority granted by this Rule has terminated. 

COMMENT

[1] This Rule recognizes that a lawyer admitted in another jurisdiction may need to relocate to or commence practice in this jurisdiction, sometimes on short notice.  The admissions process can take considerable time, thus placing a lawyer at risk of engaging in the unauthorized practice of law and leaving the lawyer’s clients without the benefit of their chosen counsel.  This Rule closes this gap by authorizing the lawyer to practice in this jurisdiction for a limited period of time, subject to restrictions, while the lawyer diligently seeks admission. 

[2] While exercising this authority, the lawyer must not hold out to the public or otherwise represent that the lawyer is admitted to practice in this jurisdiction.  See Rule 5.5(b)(2).  Because a lawyer with an office in this jurisdiction will typically be assumed to be admitted to practice in this jurisdiction, the lawyer must, under this Rule, disclose the lawyer’s limited practice authority and jurisdiction of licensure in all communications with potential clients, such as on business cards, websites, and letterhead.  Further, the lawyer must disclose the limited practice authority to all potential clients before agreeing to represent them.  See Rules 7.1 and 7.5(b). 

[3] The provisions of paragraph 4 (a) through (e) of this Rule are necessary to avoid prejudicing the rights of existing clients or other parties.  Thirty days should be sufficient for the lawyer to wind up his or her practice in this jurisdiction in an orderly manner.

The Commission's Explanation for the Proposal

The Commission concluded that technological and economic changes have produced an increase in cross-border practice, revealing an important gap in the practice authority granted by Model Rule 5.5(d).  That gap affects an increasing number of lawyers who have found it necessary to establish a practice in a jurisdiction where they are not otherwise admitted.  For example, a lawyer may need to relocate in order to accommodate the needs of a client who has moved to a new jurisdiction. Or the lawyer may receive a job opportunity in a jurisdiction other than the jurisdiction of original licensure or be transferred to another jurisdiction, often requiring relocation within a very short timeframe.  Lawyers also frequently have to relocate due to changes in personal circumstances, such as the relocation of a spouse or domestic partner due to military deployment or other professional opportunities.  In sum, lawyers increasingly need to relocate during their careers, often more than once and frequently without much notice. 

The Commission found and heard that, despite the increasing need to relocate, the admissions process for these lawyers can take considerable time.  For example, the admission by motion process requires an applicant to complete and submit a lengthy application that requires personal and professional information that can take weeks or months to compile.  In particular, the process typically requires a lawyer to obtain proof of licensure from the lawyer’s home jurisdiction, submit evidence of a passing score on the Multistate Professional Responsibility Examination, and accumulate substantial personal and professional information in order to satisfy the character and fitness requirements of the jurisdiction.  Similarly, if the lawyer does not qualify for admission by motion (e.g., the lawyer has not satisfied the durational practice requirements), the lawyer will need to sit for the jurisdiction’s bar examination, which is administered only twice per year. 

The Commission found that this time consuming process can adversely affect lawyers’ ability to represent their existing clients effectively and can have adverse consequences on lawyers’ careers in a marketplace that requires an increasing amount of cross-border practice.  Thus, the Commission concluded that, assuming procedural safeguards are put in place, these lawyers should be permitted to establish a continuous and systematic presence in the new jurisdiction for a limited time (not to exceed 365 days) while diligently pursuing formal admission.  The proposed new standalone Model Rule on Practice Pending Admission, if adopted, would authorize this form of practice. 

The proposed new Model Rule on Practice Pending Admission also includes a separate section that allows a foreign lawyer already licensed in one U.S. jurisdiction as a foreign legal consultant to continue practicing as a foreign legal consultant in another U.S. jurisdiction while an application to become a foreign legal consultant is pending in that new U.S. jurisdiction.  It is important to note that this provision does not create any practice authority for foreign lawyers beyond what the Model Rules have already long allowed (e.g., rules relating to licensing and practice by foreign legal consultants and rules governing whether foreign lawyers can sit for a particular jurisdiction’s bar examination).  The section merely provides (subject to important limitations) that a foreign lawyer who is already admitted in a U.S. jurisdiction as a foreign legal consultant may continue to practice as such while their application for that form of admission is pending in another U.S. jurisdiction.

To make lawyers aware of the new practice authority, the Commission also proposes to amend Rule 5.5(d)(2) of the Model Rules of Professional Conduct to remind lawyers that they can practice in another jurisdiction on a systematic and continuous basis as long as another “rule” so provides.  Comment [18] to Rule 5.5 would then make an explicit cross-reference to the proposed Model Rule on Practice Pending Admission. 

The Commission’s recommendation in this regard is not without precedent.  The District of Columbia allows out-of-state lawyers to practice law from a principal office located in the District of Columbia for a period not to exceed 360 days during the pendency of a person’s first application for admission to the District of Columbia Bar.[1]  The Commentary to the Rule states that it is designed to provide a one-time grace period for out-of-state lawyers who are moving their principal office to the District of Columbia.  Missouri also has a similar procedure,[2] and New York recently adopted a similar provision for in-house lawyers.[3]  The Commission did not learn of any problems caused by these provisions.   

The Commission nevertheless concluded that, to ensure that lawyers do not abuse the proposed exception or use this privilege in ways that would put the public at risk, numerous restrictions and limitations are appropriate.  First, the lawyer must not be disbarred or suspended from practice in any jurisdiction and must not currently be subject to discipline or be the subject of a pending disciplinary matter in any jurisdiction.   

Second, the lawyer must not have been previously denied admission to practice in the jurisdiction (e.g., due to a failure to satisfy the jurisdiction’s character and fitness requirements) or previously failed the jurisdiction’s bar examination.  This requirement is designed to ensure that a lawyer does not use the authority to practice under the Model Rule on Practice Pending Admission to circumvent a prior denial of the right to practice in the jurisdiction.  For example, if a lawyer fails the bar examination in one jurisdiction and passes it in another, the lawyer cannot establish a practice in the former jurisdiction while waiting to re-take that jurisdiction’s bar examination.  (The Commission considered whether a failure of the jurisdiction’s bar exam should be disqualifying for only a limited period of time (e.g., five years), but concluded that a cap would allow a lawyer who failed the jurisdiction’s bar examination (and whose competence was, therefore, previously called into question in that jurisdiction) to engage in the practice of law in that jurisdiction without having completed a thorough vetting process, like admission by motion.)

Third, the lawyer must notify Disciplinary Counsel and the licensing authority in writing that the lawyer is taking advantage of the practice authority in the Model Rule on Practice Pending Admission.  This requirement is intended to ensure that the disciplinary and licensing authorities are aware of the lawyer’s presence and intention to establish an ongoing practice in the jurisdiction under the Rule. 

Fourth, the lawyer must submit an application for admission by motion, examination, or as a foreign legal consultant within [60] days of first providing legal services.[4]  The purpose of this requirement is to ensure that a lawyer is serious about applying for admission in the new jurisdiction and applies promptly upon arriving there.  The time frame is placed in brackets so that a jurisdiction can tailor it according to the particular needs of that jurisdiction.

Fifth, the lawyer must have a reasonable expectation that the lawyer will fulfill all of the jurisdiction’s requirements for admission.  This requirement is analogous to Rule 5.5(c)(2), which permits a lawyer to practice temporarily in a jurisdiction in connection with a litigation matter if the lawyer “reasonably expects to be . . . authorized” to appear before a tribunal in that jurisdiction.

Sixth, the lawyer must associate with a lawyer who is licensed to practice in the jurisdiction.  This requirement is designed to ensure that the incoming lawyer has the ability to consult with a lawyer who is licensed in the jurisdiction regarding any issues that may require knowledge of distinctly local laws or procedures. This requirement is similar to the requirement in Rule 5.5(c)(1), which permits an out-of-state lawyer to practice temporarily in the jurisdiction if the lawyer associates with a lawyer who is admitted in the jurisdiction.  The Commission was reluctant to impose a stricter requirement, such as a requirement to be directly supervised by a lawyer who is admitted in the jurisdiction, because of the particular obstacles such a requirement would impose on solo practitioners.  In particular, in-state lawyers may be reluctant to directly supervise a lawyer from another jurisdiction who is not in the same office, because of the administrative difficulties associated with supervising a lawyer in a different law office.  For these reasons, the Commission concluded that the “association” requirement, which has worked well in the context of temporary practice under Rule 5.5(c)(1), is an adequate safeguard in the context of the Model Rule on Practice Pending Admission as well.[5]

Seventh, Section 4 provides that the practice authority terminates immediately if the lawyer’s application for admission is denied before the expiration of the 365 day period (e.g., the application for admission by motion is denied or the lawyer fails the jurisdiction’s bar examination), or if the lawyer fails to file an application for admission within 60 days.  Upon denial of the application for admission, Section 5 provides that the Admissions Authority must notify Disciplinary Counsel that the authority granted pursuant to the Rule has terminated.  Concurrently, the lawyer must stop practicing in the jurisdiction unless authorized to do so pursuant to another Rule; notify all clients being represented in pending matters in the jurisdiction, as well as opposing counsel or co-counsel, that the lawyer’s practice authority has terminated; and not undertake any new representation that would require the lawyer to be admitted to practice law in the jurisdiction.  These requirements are analogous to the client protection measures in Rule 27 (“Notice to Clients, Adverse Parties, and Other Counsel”) of the ABA Model Rules for Lawyer Disciplinary Enforcement applicable to lawyers disbarred, placed on inactive status due to disability or suspended for more than six months.

Eighth, a Comment to the proposed Model Rule would remind lawyers about their obligations under Rule 5.5(b)(2).  In particular, the clear import of Rule 5.5(b)(2) is that a lawyer who practices in a jurisdiction pursuant to the authority contained in the Model Rule on Practice Pending Admission cannot “hold out to the public or otherwise represent that the lawyer is admitted to practice law in this jurisdiction.”  The proposed new Comments would remind lawyers of this restriction and emphasize that, to avoid misleading potential clients, lawyers also have to disclose their limited practice authority and jurisdiction of licensure in all communications with potential clients, such as on business cards, websites, and letterhead, and explicitly disclose the lawyer’s limited authority to all potential clients before agreeing to represent them.

Finally, Section 3 makes clear that the practice authority does not extend to appearances before a tribunal.  The lawyer would have to obtain pro hac vice admission in order to appear before a tribunal in that jurisdiction.

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[1] District of Columbia Court of Appeals Rule 49(c)(8) (Limited Duration Supervision By D.C. Bar Member) http://www.dcappeals.gov/dccourts/docs/rule49.pdf

[2] Missouri Supreme Court Rule 8.06 (Temporary Practice by Lawyers Applying for Admission to the Missouri Bar) http://www.courts.mo.gov/courts/ClerkHandbooksP2RulesOnly.nsf/0/e0bcf992eb92f9ae86256db7007379ef?OpenDocument

[3] N.Y. Comp. Codes R & Reg. 22, § 522.7.

[4]Registration as in-house counsel is not listed because Rule 5.5(d)(1) already provides authority for lawyers to practice as in-house counsel in a jurisdiction without being fully admitted to practice there.   Although some jurisdictions require these lawyers to seek registration as in-house counsel, Rule 5.5(d)(1) is sufficient to protect the lawyer from allegations of unauthorized practice while the lawyer completes the registration process. 

[5]The Commission believes that state and local bar associations could provide a great service to the profession and the public by establishing a roster of experienced lawyers who are willing to associate with incoming lawyers under these circumstances.  Such an association not only would serve the public and the bar, but it also has the potential to be a source of new work for the in-state lawyer who may be called on to assist the incoming lawyer’s clients.  In many ways, this process would be analogous to the creation of rosters of lawyers who are willing to serve as mentors for new lawyers or who agree to serve as practice monitors for lawyers conditionally admitted to the practice of law. See http://bit.ly/pGDDtz.

Comments

[John Steele]

I favor the liberalization of movement, subject to client protection, but have to say that this proposed rule seems more like a policy call than an ethics rule. I wonder how many state supreme courts will approve of it. I wonder if any state legislatures have the power to enact it or to block it.

[Andrew Perlman]

John, thanks for the comment. I don't think the proposal is any less of an ethics rule than admission by motion or Rule 5.5(d), both of which describe a lawyer's authority to establish a practice in another jurisdiction. That said, the Commission had originally proposed to locate this authority within Rule 5.5(d) and decided to relocate it as a standalone Model Rule, at least in part because of the recognition that it is more analogous to the authority in the standalone Model Rule on Admission by Motion than the practice authority in Rule 5.5.

As for state legislatures, I would think that they would have the same amount of authority to enact or block this idea as they would to enact or block any other rule relating to the unauthorized practice of law by lawyers from other jurisdictions. I'm not sure that this fact means that the proposal is inappropriately presented as an "ethics" issue. Am I wrong?

[John Steele]

Andy, thanks. I wasn't criticizing so much as offering an impression. It was the "365 days" that first struck me as legislative policy making. And I agree that there are some "inside baseball" ethics rules and some that are more like "the boundaries of the game itself" rules -- and this one is in the latter category. As I say, I hope this draft prompts states to look hard at liberalizing movement.