Unauthorized Practice of Law Rules for Multijurisdiction Practice

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Many states have adopted rules of professional conduct relating to multijurisdictional practice. These rules provide attorneys leeway in some circumstances when they are acting as lawyers outside of the state where they are licensed to practice.

But not all states apply the same rules. Failure to know the rules of the state where you’re working can lead to the unauthorized practice of law, with dire consequences.

Multijurisdictional practice: an overview

During a recent Minnesota CLE, I learned about an intriguing and influential law review article: Sneaking Around in the Legal Profession, by Charles Wolfram. This 1995 essay pointed out that many transactional attorneys were conducting parts of their business in multiple states, and certainly “practicing law” by many of those states’ standards, when they were not licensed in those states. Martin Cole, the current director of the Minnesota Office of Lawyers Professional Responsibility, and William Wernz, Of Counsel at Dorsey & Whitney, gave a useful overview of the common but rarely-understood multijurisdictional practice of law.

The concept is simple: there are some circumstances under which an attorney who isn’t licensed in State B but is licensed in State A will be allowed to work in State B without violating unauthorized practice rules. The key regulations are what have been adopted in most, but not all, states as Rules of Professional Conduct 5.5 and 8.5 (here using the ABA’s Model Rules for reference), though bar admission rules and other laws also come into play.

Safe harbor: Rule 5.5

Generally, Rule 5.5 identifies the circumstances under which lawyers may practice outside of their licensed jurisdictions. The broadest safe harbor is found in Rule 5.5(c)(4), whereby a lawyer is allowed to temporarily practice if the legal services “arise out of or are reasonably related to the lawyer’s practice in a jurisdiction in which the lawyer is admitted to practice.”

According to Wernz, the Third Restatement on the Law Governing Lawyers indicates that a lawyer doing out-of-state estate work for a client’s former neighbor would be “reasonably related.” Wernz noted that the Third Restatement is a source cited in some states’ ethics opinions as authoritative, so Rule 5.5(c)(4)’s protection might be far-reaching in terms of avoiding unauthorized practice.

Pitfalls and the unauthorized practice of law: Rule 8.5

Rule 8.5 gives the state in which the Rule is adopted the authority to discipline out-of-state lawyers by that state’s own rules. Generally this means that a lawyer will be punished by the rules of the state in which the misconduct happens, regardless of whether that state would otherwise have disciplinary authority over him.

This is where the necessity of knowing local rules comes into play. In Florida, for instance, unauthorized practice of law is a felony. And it’s up to Florida to decide if the business you might have conducted there without a license is temporary, is “reasonably related” to your work where you’re admitted, or falls within another exception to unauthorized practice rules.

Multijurisdictional practice is a reality in today’s interconnected world. Some choices are easy, such as where you solicit clients or where you locate your office. But realize that the work even your most local and usual clients might ask of you — coming to another state to close a deal, reviewing documents at a remote location, or even conducting business online between disparate parties — can be viewed differently by the states in which that conduct occurs, and may be interpreted as unauthorized practice.

New lawyers and law students, who may effortlessly port their personalities, and ultimately their services, across state lines through routine use of the Internet, should take special care to recognize these rules and how they are applied differently in the several states.

(Photo: http://www.flickr.com/photos/crackers93/3002612767/in/photostream/)

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  • We’ve made some progress in the 15 years since Wolfram’s article on MJP: 42 jurisdictions have adopted Model Rule 5.5 or a close approximation of it. And yet the rule itself raises more questions than it resolves. MJP is confusing to lawyers because the rule does not clearly state what it means to practice “in” another jurisdiction for MJP purposes. One would think “in” means physically present in a jurisdiction or, in litigation, making an appearance by filing a court document. But you will find lawyers and, unfortunately, some disciplinary authorities, who believe that a lawyer can practice “in” another jurisdiction by drafting documents for a client who is in another state or by advocating on behalf of a client by correspondence sent to a party in another jurisdiction. When this misunderstanding is afoot, 5.5(c)(4) offers surprisingly little clarification or protection.

    It is unlikely that even the great Charles Wolfram could have anticipated in 1995 the extent to which cell phones, smart phones, e-mail, intra-nets, and cloud computing would allow lawyers to “sneak around,” practicing law wherever and whenever they please, just so long as some disgruntled party doesn’t get wind of it and complain to overzealous bar counsel. I hope the profession is not forever destined to lag 50 years behind what the rest of the business world is adapting to.

    • Tom Pahl

      Eric, do you think that a client who physically drafts a portion (or all) of a complaint and presents it to her attorney has engaged in the unauthorized practice of law? I think you can assume that the attorney (whose client has performed this drafting task) is comfortable with her obligations under Rule 11 and 541.211 but i am more interested in the ramifications to the unlicensed non-lawyer. thanks

  • The comments to model rule 5.5 include a vague reference to attorneys who have recognized expertise in areas that are based on federal or international law. This needs to be expanded & codified to protect attorneys whose practice areas are multijuridictional by nature, such as patent law and asset protection law.