So, for a variety of reasons, I’ve stewed over whether to write anything about what (before yesterday) was the most recent ABA Formal Ethics Opinion to be issued. That opinion was ABA Formal Op. 505 and presents itself as an opinion on, among other things, whether the ABA Model Rules permit the charging of any sort of non-refundable fee. (Spoiler: The ABA says they do not.)
Yesterday, the ABA Standing Committee on Ethics and Professional Responsibility issued another new opinion, Formal Op. 506. That opinion presents itself as an opinion about whether lawyers can use people who are not lawyers to handle their client intake functions and what requirements for such work are imposed by ABA Model Rule 5.3.
Since these opinions are on vastly different subjects but suffer from a common — and actually sort of disturbing — flaw, I will now write about them together.
Before delving in, and as something of a reminder of at least my view of what ethics opinions should be about, ethics opinions should be about assisting with the interpretation of the language of an existing rule or about assisting with helpful examples of how the language of the rule (including as already elaborated upon in Comment) applies to particular situations.
Seems pretty simplistic and obvious to say it like that, but … it is not always so simple in practice it seems because both 505 and 506 manage to not be limited to those tasks at all.
Formal Op. 505 is more egregious to some degree than 506 but even evaluating which one is worse kind of depends on your own personal views. To figure out which one might seem worse to you, you are going to have to decide whether it is worse to use an ethics opinion to attack rules adopted by jurisdictions that do not track the ABA Model Rules or to use an ethics opinion to expand the scope of certain rules by applying requirements from one rule onto another rule with no textual support.
That can be a bit dodgier of a question than it might otherwise seem because both paths are not at all great.
Formal Op. 505 has every right to say 90% of what it says and conclude that the Model Rules do not permit the charging of a nonrefundable fee. It also has every right (even though I think it is wrongheaded) to say that, under the Model Rules, a flat fee paid in advance has to be kept by the lawyer in a trust account until it is earned. In doing so, the ABA makes being a criminal defense lawyer almost untenable in any jurisdiction that tracks the ABA Model Rule, but while it may be a foolhardy position it is not inconsistent with what an ethics opinion is supposed to be about.
What it chooses to do that is both outside the scope of what an ethics opinion ought to be, and what is a pretty audacious thing to do under all of the circumstances, is take potshots at the viability and efficacy of rules adopted by other jurisdictions that have chosen to deviate from the ABA Model Rules and expressly permit the charging of nonrefundable fees.
This paragraph and its accompanying footnotes really should have been buried in red marker and left on the cutting room floor (to completely mix my metaphors):
Some jurisdictions have authorized lawyers to treat advances as the lawyer’s property upon payment, so long as the client signs a fee agreement designating the sum as “nonrefundable” or “earned on receipt” or some other variation on this theme. This approach departs from the safekeeping policy of the Model Rules described herein and creates unnecessary risks for the client.
Thankfully, I guess, no aspect of the footnotes explicitly attacks Tennessee’s RPC 1.5(f) which does authorize the charging of a nonrefundable fee, but I’m going to assume that the Opinion’s antipathy extends to my state’s rule as well.
Even within the scope of what the Opinion has the right to do, it is pretty remarkable that after expending so much ink on its other hypothetical scenarios, the opinion really just shrugs off the problem it creates as to a flat fee paid up front and mandating that the full amount be held in trust until it has been earned. I guess the Opinion just couldn’t bring itself to say — “I mean we can’t really tell you how that works as a practical matter so you’ll kind of just have to figure it out.”
Formal Op. 506 does not take potshots at jurisdictions that have deviated from the Model Rules, but it does decide to announce that RPC 1.4(b) — a rule that only applies to clients — somehow also applies to prospective clients as if it were included in RPC 1.18.
This trainwreck of a paragraph really is the crux of the problem with this opinion as a whole.
Rule 1.4(b) mandates that a lawyer communicate with clients and provide the clients, to the extent reasonably necessary, with explanations that allow the clients to make informed decisions regarding their representation. Some of the communication duties set forth in Rules 1.5(b) and 1.4(b) also apply in the context of explaining fee agreements to prospective clients. We note that Rule 1.4(b) does not expressly apply to prospective clients. Indeed, some of Rule 1.4(a)’s requirements—such as providing updates, consulting about means being employed to address objectives, and responding promptly to requests for information regarding a representation—would not make sense in that context. But it would seem imprudent to wait until after engagement for a lawyer to “explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation” as required by Rule 1.4(b). ABA Formal Opinion 02-425 (2002) applied Rule 1.4(b) to lawyers who “ask prospective clients to execute retainer agreements that include provisions mandating the use of arbitration to resolve fee disputes and malpractice claims.” This interpretation has been extended to explaining “certain implications of the joint representation” by at least one ethics committee. Therefore, we apply Rule 1.4(b) to lawyers when they communicate with both current and prospective clients.
Now the opinion is entirely transparent about the exercise, but that does not change the substantive problem. If the ABA Model Rules intend for part or all of the duties under RPC 1.4 to also apply to prospective clients, then it should say so in RPC 1.18 or use the words “clients or prospective clients” in appropriate places in RPC 1.4. Since it does not do so, ethics opinions like 506 will now just raise questions about what other duties that the rules say only apply to clients also apply to prospective clients despite not being discussed at all in RPC 1.18.
It is also kind of ass-backwards (pardon my French) to expect the lawyer rather than the client to know more about the matter at the intake stage as really the intake stage is more about the client explaining the matter to the extent reasonably necessary for the lawyer to make informed decisions about whether she wants to take on the representation.
The decision to try to rewrite aspects of the rules through this opinion is made even more frustrating by the fact that the question should be capable of being much more simply answered.
The simple answer is that within the context of the ethics rules a lawyer can have someone who is not a lawyer but who works for her handle pretty much any task as long as it is being done under the lawyer’s guidance and supervision. Period. Full stop.
No, seriously. That’s kind of the full point of Model Rule 5.3. As long as the lawyer takes ultimate responsibility for the work performed and has measures in place to comply with Model Rule 5.3, then having someone who is not a lawyer handle client intake cannot be unethical.
The reason for that is the same reason why, if a lawyer wants to hire a gifted 20-year college dropout and have the dropout draft their briefs in their cases, as long as the lawyer reviews and takes responsibility for the work product then the lawyer is not engaged in a violation of RPC 5.3. (They also should not be deemed to be in violation of RPC 5.5 at all but that is a topic for another day.)
Now, if the work product the drop out cranks out is subpar, and the lawyer should not have adopted it, then the lawyer can be on the hook for many ethical violations, such as Rule 1.1 (competence) and Rule 3.1 (non-meritorious claims) if say the work product makes non-viable arguments, and the lawyer can also be on the hook for legal malpractice.
In fact, this point is made in the opinion and could have (with one line-edit: deleting “many”) been all that needed to be said:
While many client-intake tasks lawyers perform may be delegable with proper policies in place, training, and supervision, lawyers who delegate do not relinquish their responsibilities under the Model Rules.
Now I am aware that there are people who are happy that this opinion was issued to knock down any notion that lawyers cannot delegate such tasks on client intake to staff or call centers or both.
But rather than stick to the point of Model Rule 5.3 and simply apply it to the intake process as an example, the whole point of this opinion ends up appearing to be to try to graft the requirements of Model Rule 1.4(b) on to interactions with prospective clients. The fact that the opinion then also manages to veer into trying to address UPL issues even though it indicates it should set them aside just manages to make matters a little bit worse.
That is less than helpful.