Practice boundaries and structure - Unauthorized practice of...

Learning Outcomes

After reading this article, you will be able to identify what constitutes unauthorized practice of law by both lawyers and nonlawyers, explain the rules restricting practice to admitted attorneys, recognize permissible exceptions for temporary or in-house practice, and apply the supervision requirements for nonlawyer staff. You will also understand the consequences of assisting or engaging in unauthorized practice, as tested on the MPRE.

MPRE Syllabus

For the MPRE, you are required to understand the boundaries of lawful legal practice and the restrictions on unauthorized practice by lawyers and nonlawyers. This article addresses:

• The definition and scope of unauthorized practice of law.
• Prohibitions on lawyers practicing where not admitted.
• Permissible exceptions for temporary or in-house practice.
• Rules for supervising nonlawyer staff and preventing unauthorized practice.
• Lawyer liability for assisting nonlawyers in unauthorized practice.
• Prohibitions on fee sharing and partnerships with nonlawyers in legal practice.
• Consequences for violations, including discipline and civil/criminal penalties.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. Which of the following is most likely unauthorized practice of law?
   1. A lawyer admitted in State X advises clients on State Y law from an office in State Y, without local admission.
   2. A paralegal drafts documents under a lawyer’s supervision, with the lawyer reviewing all work.
   3. An in-house counsel admitted in State A advises her employer’s offices in State B, where she is not admitted, on internal matters only.
   4. A lawyer from State C negotiates a settlement in State D, associated with local counsel who actively participates.
2. Under the Model Rules, a lawyer is subject to discipline for:
   1. Practicing law in a jurisdiction where not admitted, unless an exception applies.
   2. Allowing a paralegal to meet with clients, provided the lawyer reviews all work.
   3. Paying a nonlawyer employee a bonus from firm profits.
   4. Giving legal advice to a claims adjuster whose job requires legal knowledge.
3. Which of the following is permitted under the Model Rules?
   1. A lawyer forms a partnership with a nonlawyer to provide legal services.
   2. A lawyer delegates legal research to a paralegal, supervises, and remains responsible.
   3. A lawyer allows a nonlawyer to direct the lawyer’s professional judgment.
   4. A lawyer pays a nonlawyer a percentage of each legal fee collected.
4. A lawyer allows a nonlawyer assistant to independently advise clients and prepare legal documents for a fee, without supervision. Is the lawyer subject to discipline?
   1. Yes, for assisting unauthorized practice.
   2. No, if the nonlawyer is competent.
   3. No, if the clients consent.
   4. No, if the nonlawyer charges less than a lawyer.

Introduction

The practice of law is strictly limited to those admitted in a jurisdiction. Lawyers must not practice where they are not admitted, and nonlawyers are prohibited from providing legal services. The Model Rules impose clear boundaries on who may practice law, how lawyers may supervise nonlawyer staff, and what exceptions exist for temporary or in-house practice. Violations can result in discipline, civil liability, or even criminal penalties.

Key Term: Unauthorized Practice of Law
Providing legal services or holding oneself out as authorized to practice law in a jurisdiction where not admitted, or by a nonlawyer, except as permitted by law.

Who May Practice Law

Only lawyers admitted to a jurisdiction may practice law there. Practicing law generally includes advising clients on legal rights, preparing legal documents, and representing clients in legal proceedings. Each state defines the practice of law, but the Model Rules prohibit lawyers from practicing where not admitted and from assisting others in unauthorized practice.

Key Term: Practice of Law
Activities requiring legal judgment, such as advising clients, drafting legal documents, or representing clients in proceedings, as defined by law.

Prohibition on Unauthorized Practice by Lawyers

A lawyer must not:

• Practice law in a jurisdiction where not admitted, unless an exception applies.
• Establish an office or continuous presence in a jurisdiction where not admitted.
• Hold out to the public as admitted in a jurisdiction where not licensed.

Exceptions Permitting Temporary or In-House Practice

A lawyer admitted in one U.S. jurisdiction may provide legal services temporarily in another if:

• Working in association with a local lawyer who actively participates.
• Authorized by law or court order to appear pro hac vice.
• Engaged in alternative dispute resolution (e.g., arbitration) related to the lawyer’s admitted practice.
• The services arise out of or are reasonably related to the lawyer’s practice in their home jurisdiction.

In-house counsel may provide legal services to their employer in another jurisdiction, if not prohibited by local rules, but may not represent others or appear in court without admission.

Prohibition on Unauthorized Practice by Nonlawyers

Nonlawyers may not engage in activities constituting the practice of law. This includes giving legal advice, representing clients in court, or preparing legal documents for others for compensation.

Key Term: Nonlawyer
Any person not admitted to practice law in the relevant jurisdiction.

Lawyer’s Duty to Prevent Unauthorized Practice

Lawyers must not assist nonlawyers in unauthorized practice. This includes:

• Allowing nonlawyers to give legal advice to clients.
• Permitting nonlawyers to represent clients in legal matters.
• Failing to supervise nonlawyer staff adequately.

Key Term: Supervision
The lawyer’s responsibility to oversee nonlawyer staff to ensure compliance with the rules and prevent unauthorized practice.

Key Term: Paraprofessional
A nonlawyer employee, such as a paralegal, who may perform delegated tasks under a lawyer’s supervision but cannot independently practice law.

Permissible Delegation and Supervision

Lawyers may delegate certain tasks to nonlawyer staff, such as legal research, document drafting, or client interviews, provided:

• The lawyer supervises and reviews the work.
• The lawyer retains responsibility for the final product.
• The nonlawyer does not give legal advice or represent clients independently.

Assisting Nonlawyers Whose Jobs Require Legal Knowledge

Lawyers may provide professional advice to nonlawyers whose employment requires legal knowledge (e.g., claims adjusters, accountants), but may not enable them to practice law for others.

Fee Sharing and Partnerships with Nonlawyers

Lawyers may not:

• Share legal fees with nonlawyers, except for certain retirement or compensation plans.
• Form partnerships with nonlawyers if any activities involve the practice of law.
• Permit nonlawyers to direct or control the lawyer’s professional judgment.

Worked Example 1.1

A lawyer admitted only in State A opens an office in State B and advises clients on State B law without local admission or pro hac vice status. Is this permitted?

Answer:
No. The lawyer is engaging in unauthorized practice by establishing a presence and practicing in a jurisdiction where not admitted. This is subject to discipline.

Worked Example 1.2

A paralegal in a law firm meets with clients, drafts legal documents, and gives legal advice, all without lawyer review. The lawyer is aware but does not intervene. Is the lawyer subject to discipline?

Answer:
Yes. The lawyer is responsible for supervising nonlawyer staff and must not allow unauthorized practice. Failure to supervise and prevent the paralegal from practicing law independently is a violation.

Worked Example 1.3

An in-house counsel admitted in State X provides legal advice to her employer’s offices in State Y, where she is not admitted. She does not represent others or appear in court. Is this allowed?

Answer:
Yes, if State Y permits in-house counsel to advise their employer without local admission. However, she may not represent others or appear in court without proper admission.

Exam Warning

Lawyers are subject to discipline for unauthorized practice even if no client is harmed. Client consent or lack of harm does not excuse violations.

Revision Tip

Always check whether a lawyer is admitted in the relevant jurisdiction and whether nonlawyer staff are properly supervised. Watch for exceptions, but remember they are narrow.

Summary

Only admitted lawyers may practice law in a jurisdiction. Nonlawyers cannot practice law, and lawyers must not assist them. Supervision of nonlawyer staff is required. Limited exceptions exist for temporary or in-house practice. Violations can result in discipline, civil or criminal penalties, or loss of license.

Key Point Checklist

This article has covered the following key knowledge points:

• Only lawyers admitted in a jurisdiction may practice law there.
• Unauthorized practice includes advising, representing, or preparing legal documents without proper admission.
• Exceptions allow limited temporary or in-house practice under strict conditions.
• Nonlawyers may not practice law; lawyers must not assist or permit it.
• Lawyers must supervise nonlawyer staff and remain responsible for their work.
• Fee sharing and partnerships with nonlawyers in legal practice are prohibited.
• Violations can result in discipline, civil liability, or criminal penalties.

Key Terms and Concepts

• Unauthorized Practice of Law
• Practice of Law
• Nonlawyer
• Supervision
• Paraprofessional