Virtual practice: ABA revisits Model Rule 5.5

iStock image used with permission

The practice of law has seen numerous changes in the last 10 years, as online options have expanded to give attorneys the ability to work from almost anywhere. For the last decade, though, the American Bar Association’s licensing guidelines have remained unchanged.

First published in 1983 and last revised in 2002, ABA Model Rule of Professional Conduct 5.5 states that a lawyer with a “systematic and continuous presence” in a particular jurisdiction must be licensed to practice in that jurisdiction. The 2002 revision said that a lawyer can practice in another jurisdiction and yet not be systematically and continuously present there.

Whether by email, social networking, online marketing or other virtual forms, “almost all practicing lawyers have occasion to communicate with actual clients and potential clients in other jurisdictions,” said Washington-based attorney Jamie Gorelick, co-chair of the ABA Commission on Ethics 20/20. “Is there a point at which such virtual presence is systematic and continuous?”

The commission has posed three possible approaches in an Issues Paper. It is accepting comments through July 31.

“I think that a lot of virtual practitioners have questions and then they have to go to their state bar ethics opinion … and then from those outdated opinions, figure [it] out,” said Stephanie Kimbro, a member of the ABA’s eLawyering Task Force and director of the North Carolina branch of virtual law firm Burton Law LLC.

Virtual firms have arisen on the Internet, which allows lawyers to work with clients completely online. However, even lawyers with brick-and-mortar firms need to be concerned with the ethical implications when using technology to work with clients in other jurisdictions, Gorelick said.

“Over the last decade, there has been a proliferation of tools that permit a lawyer in one jurisdiction to communicate with clients or potential clients in another,” she said. “This is increasingly common in the profession, and yet the rules give very little guidance as to the import of that.”

Changes to the ABA’s model rules, however, could be a problem for an increasing number of lawyers, Kimbro said. Because the rules are not updated often, she said, a change now to regulate virtual practice could limit innovation in the future.

“We’re seeing more solo and small firms doing online delivery,” Kimbro said. “I think [a change in the rules] would cause them some confusion or hesitation if they wanted to live in one state but provide legal services in another.”

The first idea posed in the ABA’s issue paper is to use certain metrics to determine whether a lawyer’s virtual presence in another jurisdiction is “systematic and continuous.” Those measurements include the number, proportion and frequency of clients in that jurisdiction and the extent to which the lawyer’s services affect that jurisdiction.

The second possibility is to refer the issue to the Standing Committee on Ethics and Professional Responsibility, which would then define systematic and continuous presence in the context of virtual practice.

The third suggestion is to have the commission file an educational report but make no proposal to change the issue.

Richard Granat, a co-chair of the eLawyering Task Force and owner of virtual law firms mdfamilylawyer.com and granatwills.com, said the third suggestion is the most viable, as it will clarify the ethical issues that arise from using the Internet to serve clients, without limiting lawyers to a dated set of ethics rules.

There is already a set of guidelines for virtual practice on this issue — a list of suggested minimum requirements for law firms practicing online, compiled by the eLawyering Task Force. While those guidelines are only published as advice for virtual practice, they do address the ethical issues behind virtual practice in another state.

One of the suggested requirements states that virtual law firms “must serve only clients who are residents of the state where the firm is authorized to practice, or clients who have a matter within the state where the law firm is authorized to practice.”

This means that, for example, a lawyer licensed to practice law in New York could practice law online from any state, as long as the client is a New York resident or is seeking counsel on a matter within New York.

Carolyn Elefant, proprietor of MyShingle.com and author of “Solo by Choice: How to Be the Lawyer You Always Wanted to Be,” said that should be the rule for all lawyers and that limiting it to online practitioners would give them an unfair advantage.

“The rule should be that whatever state you’re licensed in, you should be able to handle issues in that state, no matter where you are,” said Elefant, who has already sent comments to the commission.

Granat agreed, saying that knowing the law in a particular jurisdiction is more important than being there physically.

The Ethics 20/20 Commission is planning to discuss the issue paper at the ABA’s annual meeting in August and again in September and October. At those meetings, members will decide what proposals, if any, they should make to the ABA House of Delegates in February 2013.

Whatever the commission and the House of Delegates may decide, Gorelick said, it is clear the business model of the practice of law is changing.

“You now have these agglomerations of people who never physically meet together … who come together to serve a client,” she said, “and our system is premised on individuals in law firms being physically present in a jurisdiction.”