Legal Profession (California & ABA)
Preface
Historical overview of the lawyer, a consideration of what is the “practice of law,” a review of the ethical standards that form the norms for the practice of law, a consideration of the public responsibilities of the lawyer as the embodiment of the legal structure of society, attention to the economic aspects, and the place of the judiciary with respect to the bar.
Legal ethics apply to all attorneys in every field of practice.The California Rules of Professional Conduct (CRPC) prohibit participation in settlement agreements that attempt to hide unethical, incompetent, negligent, or willful misconduct.
In California, there is no squeal rule, i.e., an affirmative ethical duty to report professional misconduct.
By contrast, the ABA rules mandate reporting other lawyers who have violated the rules of professional conduct.
Regulation of the Legal Profession
The Law Governing Lawyers (Restatement)
Lawyers are regulated by moral, professional, and legal constraints in discharging their several responsibilities as representatives of clients, officers of the legal system, and public citizens having special responsibilities for justice.
Federal Preemption
Regulation of attorneys is generally a matter of state law. Federal laws preempt state laws regulating the conduct of attorneys in two situations: (1) when constitutional rights are involved; or (2) matters of exclusive federal jurisdiction.
State Preemption (Baron Case – LA Lobbying Ordinance)
Laymen who “practice law” within the meaning of the State Bar Act are guilty of a misdemeanor. Occurs where “legal questions are involved which, to safeguard the pubic, reasonably demand the application of a trained legal mind.”
Separation of Powers (Negative Inherent Powers)
The power of the judiciary to govern admission to the practice of law is based on the California Constitution article VI, section 1. Where the power to regulate attorneys is not expressly granted in the state constitution, it is assumed by courts under the negative inherent powers doctrine, which is part of the constitutional separation of powers.
Constitutional tribunals have authority to protect the sanctity of the judicial process (i.e., integrity).
Supervisory or administrative powers enable them to carry out their duties (i.e., necessary for business).
Equitable power is derived from the historic power of equity courts (e.g., neutrality, fairness, just results).
Potter Case – Prozac Settlement
A lawyer’s obligation to exercise candor with the trial court supersedes his obligation to a client. The trial court, upon a reasonable basis, has inherent authority to conduct an investigation and a hearing to determine whether its judgments accurately reflect the truth (i.e., actual fraud not required.)Inherent authority to protect legitimacy and accuracy.
California State Bar
The state bar was created by the legislature to assist the CA Supreme Court. Mandatory, integrated, or unified bar is constitutional as a pre-condition to practicing law. Dues may not be used to support political ideology that does not relate to the legal profession, but bar may still take positions. Regardless, about 85% of the budget is used for discipline.
The State Bar does not have the power to make ethics rules that are binding on California lawyers. Instead, it generates proposed rules which only the Supreme Court can adopt and make binding. B&P Codes 6076-77.
State Bar Court
The State Bar Court is divided into the Hearing Department and the Review Department. A State Bar Court decision recommending that an attorney be suspended or disbarred is transmitted to the Supreme Court for independent review.
The American Bar Association (ABA)Model Rules of Professional Conduct persuasive, not authoritative, in CA.
California Rules of Professional Conduct (CRPC) – violations result in suspension or disbarment
CRPC help define the duty component of the fiduciary duty which an attorney owes to his client, but are not intended to create new civil causes of action. Nothing in the rules shall be deemed to create, augment, diminish, or eliminate any substantive legal duty of lawyers or the non-disciplinary consequences of violating such a duty. CRPC Rule 1-100(A).
Malpractice (duty, breach, cause-in-fact, scope of liability, & damages) – violations result in substitutionary relief
Most malpractice cases tend to involve a claim that because the lawyer did or did not do something, the client lost. In order to prove causation, you need a trial within a trial to show but for the lawyer’s conduct, the client would have won.
Admission Standards
Discipline is properly imposed for acts involving moral turpitude whether or not they relate to conduct by an attorney in his professional capacity; therefore, the fact an act was committed prior to bar admission is irrelevant.Stratmore.
If the conduct is egregious enough, a license may be cancelled for fraud, as though he had never been admitted.
Qualification over Machination
The Ninth Circuit ruled that the Trust Territory of the Pacific Islands is not a territory or insular possession of the United States and disbarred Rothstein. A court is not a slave to literal interpretation of its local rules where injustice is the result (i.e., where a literal interpretation would thwart the purpose of the rule or lead to an absurd result.) If an attorney gains membership based on membership in another bar, and was not in fact properly admitted to that bar, then the attorney must be removed even if the attorney remains a member of the bar which erroneously admitted him.In re Francis Cano.
Federal Qualification
Federal courts have the exclusive right to determine admission to federal courts. Their admission rules preempt state law on unauthorized practice, which only applies to practice before state courts. Most district courts require the attorney to be a member of the bar of the state in which the district court is located. However, if a lawyer is disbarred by a state, that disbarment does not necessarily terminate the lawyer’s admission to federal courts in that state.
Formal Requirements
Consumer protection/avoiding incompetence model / Informed consent model
Education: 2 years undergraduate; sufficient legal knowledge; baby bar when not accredited; foreign REQs discretionary.
Diploma privilege: Most states require passage of the bar exam as a condition to practice law. A few states, however, consider graduation to be sufficient. (Rationale: unfairness, racial discrimination, no Sherman Act liability, etc.)
Citizenship and Residency Requirements
(1) Admission to the bar may not be based on citizenship; (2) A nonresident who has passed the bar exam cannot be denied admission for refusal to live in the state; (3) A licensed lawyer who seeks admission by reciprocity cannot be required to change his residence (but may be required to practice full time in that jurisdiction); (4) A state may not require limited residency (i.e., residency for a short period of time) before being allowed to take the bar exam; (5) A federal court may not impose a residency requirement as a condition for admission to its bar, but it may require that an attorney be a member of the bar of the state in which the federal court sits (because it relates to fitness to practice.)
Moral Character
Schware standard: A state can require high qualification standards, such as good moral character or proficiency in its law, but any qualification must have a rational connection with the applicant’s fitness or capacity to practice law.
Interests: (1) Mental health; (2) honesty, integrity; (3) personal, social, business conduct; (4) political beliefs.
Reasons: (1) Shielding clients from abuse; (2) safeguarding the legal system from subversion; (3) public image.
Acts of moral turpitude: Violent crimes, fraudulent crimes, antisocial conduct, drunkenness, or drug abuse.
Mental Health
Case law under the Americans with Disabilities Act limits the questions that may be asked about an applicant’s mental health by setting temporal and/or substantive bans (e.g., disciplinary proceedings limited to ability & fitness to practice.)
Ronwin [AZ Refused Admission]: Disbarred elsewhere due to frivolous lawsuits caused by paranoid personality.
Rowe [Dream House]: Not criminally culpable for slaying of wife and children yet warrants disciplinary action for
“conduct that tends to reflect adversely on the legal profession as a whole and undermine public confidence.”
Honesty, Integrity, and Criminal Conduct
In California, failure to disclose relevant information is an act of moral turpitude, worthy of post-admission sanctions.
The State Bar may consider any criminal act committed by the applicant, regardless of charges, dismissals, or acquittals.
Crimes like homicide, domestic violence, sexual assault, and robbery are sufficient for disbarment/denial of admission.
Noncommercial sex acts between consenting adults are not relevant to prove fitness to practice law; however,
applicants may be denied admission for actionable sexual conduct, such as rape, child molestation, etc. not adultery.
Civil Disobedience in California
(1) Advocacy is protected under the 1st Amendment unless it is intended to incite or produce imminent lawless conduct
(2) An attorney who engages in violations of the law may be disciplined; and
(3) An attorney may not advise a client to disobey the law unless the attorney reasonably and in good faith believes the law is invalid and there is a good faith argument for its reversal or modification (see, e.g., Hallinan v. State Bar).
Political Beliefs
The State Bar may inquire into all knowing memberships in “subversive” organizations, including (1) right-wing militia movements; (2) terrorist organizations; and (3) hate groups.Whether it is appropriate to assess an applicant’s character and fitness on speculative predictions of future actionable misconduct. See, e.g., Hale: KKK member denied admission.
Squeal Rule recognized by ABA, but not California—subject to privileges.
B&P contains oath for California lawyers. For readmission, rehabilitation requires a manifestation of remorse.
The Authorized Practice of Law
Until the 1960s, when antitrust laws were strengthened, treaties defined the areas within nonlawyers could give advice.
“The Practice of Law” – Undefined by the ABA, MR, CRPC, and B&P yet not void for vagueness.
Chesterfield Smith: The practice of law is anything my client will pay me to do.
Palmer Case: Each case must be decided upon its own particular facts.
Merchants Case: (1) representation of another before court/tribunal; (2) prep of docs substantially affecting legal rights.
Early version of ABA Code of Responsibility: Rendering of services that call for the professional judgment of a lawyer.
The California attorney general enforces the rules and the unauthorized practice of law is a misdemeanor.
Unauthorized Corporate Legal Services
A corporation, other than a certified professional legal corporation, is forbidden to practice law (but may hire counsel).
Merchants’ Protective Corporation: Duty of loyalty compromised by corporate contract for members’ legal services.
The company contract in Merchants was arranged to prevent the violation of three common law crimes:
Barratry consists of the practice of groundless judicial proceedings (i.e., three times with intent to vex or annoy).
Maintenance is interference in a suit (e.g., support to continue/multiply) in which the intervenor has no interest.
Champerty is a deal to split the proceeds of a litigated claim btwn interested party and a third party supporter.
Trust Litigation
Ziegler: Sellers successfully moved to dismiss b/c trustee was not an attorney and thus cannot represent beneficiaries.
Finkbeiner: Trustee may appear in court without counsel to fulfill duties to report, modify, and terminate the trust.
Plaintiffs seek $200 million payable in gold and silver coins
Adams v. ABA: The courts have the authority to determine qualifications for admission to the practice of law. The requirement that only licensed lawyers may represent others in court is a reasonable rule that does not offend any constitutional guarantee. (Note: plaintiffs may assist one another behind the scenes in preparing for trial.)
JW v. Superior Court: Mother cannot represent her minor son even though she cannot afford counsel.
US v. Whitesel: Defendant’s accountant in a tax case cannot act as legal representative, but may sit at table.
Classes of Membership in the California State Bar
All members are deemed active provided they pay their dues and attend mandatory continuing legal education. B&P.
Voluntary inactive status may be requested. While inactive, they may not practice. Minimal annual dues fee required.
Involuntary inactive status may become necessary if an attorney needs treatment, confinement, or conservatorship.
Attorneys admitted Pro Hac Vice
California permits an out-of-state attorney to appear in court for a particular case. The Ninth Circuit held that there is no Immunities Clause violation for discriminating against its own residents. SCOTUS held no due process violation. Flynt.
Concerns of the dissent: Broad discretion invites capricious exclusion in civil rights cases.
Reasons for refusal: Notoriety, personal comments, ethical standing, obstruction of justice, lack qualifications.
Revocation requirements: The attorney is entitled to notice, an opportunity to respond, and written reasoning.
Note: by accepting pro hac vice status, the attorney has consented to be bound by both states’ duties and laws.
Registered Foreign Legal Consultants
A registered foreign legal consultant is a person who is admitted to practice in good standing as an attorney in a foreign country and has a certificate of registration from the California State Bar. Limited jx and needs malpractice insurance.
Group Legal Services Programs
Collective activity undertaken to obtain meaningful access to the courts is a fundamental right. Ethics Constitution.
Button: The NAACP lawyers may litigate on the behalf of victims of racial discrimination. Protected by 1st Amendment.
Brotherhood: Maintaining a list of lawyers for member recommendation is protected.
United Mine Workers: Labor union has a right to have its own salaried attorney represent worker’s compensation.
Professional Law Corporations
All directors, officers, and stockholders must be lawyers. Only licensed attorneys may direct the actions/decisions and render legal services to clients. Failing to register may result in criminal liability. May be profit or nonprofit.
Cappiello v. Boyle: If a PLC has failed to register, its clients may be solicited.
Olsen v. Cohen: Clients may not recover legal fees they paid to an unregistered firm.
Frye v. Tenderloin: Nonprofit corporations need to register but not all of the directors need to be lawyers.
Suspended Lawyers
Farnham: Practicing during suspension constitutes the unauthorized practice of law. (Note: excludes clerical activities.)
Crawford: Inactive members must send notice to the State Bar and all clients when they engage in certain activities.
Rowe: A suspended lawyer is allowed to publish a law review article listing his J.D. degree.
Certified Law Students
People v. Perez: Student in-court programs make competent lawyers. A law student, that exercises no independent judgment while appearing under the direct supervision of a member of the bar, is not engaging in the practice of law.
Dissent: The majority ignores that the State Bar is not authorized to admit a person to the practice of law. CA Sup Ct.
Paralegals
8 Prohibitions: no legal advice, no court representation (agency OK), no explaining legal documents, no acting as a runner/capper, no violating rules, no performing service contracts, no making business deals, no establishing fees.
The right to proceed Pro Se
Policy: Respect for the dignity and autonomy of the individual. / Discretion to assign advisory & standby, not co-counsel.
Faretta: A competent criminal defendant has a constitutional right to waive counsel and proceed pro se, despite the fact the ground on appeal is probably going to be that the defendant did not intelligently and voluntarily make that decision.
Hernandez: 9th Circuit held three elements required: (1) nature of charges; (2) possible penalties; (3) dangers of pro se.
However, the trial judge does not have to inform the pro se defendant of the privilege against self-incrimination.
The Unauthorized Practice of Law
Birbrower: An out-of-state law firm, not licensed to practice law in CA, violated B&P 6125 when it performed legal services in CA for a CA client. May recover quantum meruit for legal services performed in New York for the client. But note: systematic and continuous presence in a jx where a lawyer is not licensed can occur even if not physically present.
Dissent: Merchants’ definition overbroad. Baron definition better—representation or trained legal knowledge.
Legislature amended B&P 6125: Out-of-state attorneys (and laypersons) may appear in arbitration proceedings.
Supreme Court “Rules of Court” – 4 Categories of Limited Practice for Out-of-State Lawyers
Legal services attorneys:Supervised at nonprofit entities whose primary purpose is free legal services for indigents.
In-house counsel: No personal representation or court appearance; in-house counsel only for the entity-client.
Litigation attorneys: Brief work supervised by California lawyer; appearance governed by pro hac vice requirements.
Non-litigation attorneys: Transactional or non-litigation matters on foreign/federal/out-of-state issues where licensed.
Do-it-Yourself Kits
Estate of Marks: The Blanfords’ activities in selecting a will kit, discussing the distribution of assets and whether it was fair, obtaining the inventory of investments, typing the will, and arranging for the signing and witnessing of the will constituted the unauthorized practice of law. The court invalidated the bequests to the Blanfords and their organization.
Torres: No private cause of action for unauthorized practice. / Biakanja: Plaintiffs permitted to bring negligence action.
Clerical Services
Sipper: A broker is limited to clerical service and may not determine the kind of legal document a client should execute.
LPS: Merely clerical means the service did not engage in the practice of law if it made forms available for the client’s use, filled the forms in at the specific direction of the client, and filed and served those forms as directed by the client.
Interactive Software and Websites
Palmer: Publication of general advice on legal matters on a website does not purport to customize the advice for reader.
QFL: Software must clearly and conspicuously state that its products are not a substitute for the advice of an attorney.
Defrocked Lawyers
Benninghoff: The law differentiates between laypeople and defrocked lawyers. The latter cannot represent clients in state administrative hearings. However, state law cannot restrict the right of federal agencies to control who practices.