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I need an experienced, knowledgeable lawyer practicing in TEXAS (or with knowledge of Texas professional rules of practice pertaining to attorneys) as well as applicable ethics rules of American Bar Association.I am with a Texas law firm that is looking for ways to expand our business opportunities. We want to begin offering ancillary, law-related services, namely, business consulting and counseling. I understand that such ancillary activities and services are covered under the ABA Rule 5.7 (b): Law-related services consist of services that "might reasonably be performed in conjunction with and in substance are related to the provision of legal services, and that are not prohibited as unauthorized practice of law when provided by a nonlawyer." Rule 5.7(b).My question is, I want to know what the specific ethical issues our law firm should consider when deciding to offer law-related services.
Submitted: 8 months ago.Category: Business Law
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4/18/2017
Business Lawyer: Attorney2, Attorney replied 7 months ago
Attorney2
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Welcome to JA and thank you for your question. I will be the Attorney that will be assisting you. The site asked to see if I could assist you.

Toll-Free Ethics Helpline for Lawyers https://www.texasbar.com/Content/NavigationMenu/ForLawyers/GrievanceandEthics/Toll_Free_Ethics_Helpline_for_Lawyers/default.htm

I will provide a link that discusses this issue in relation to Texas. One moment please.

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Business Lawyer: Attorney2, Attorney replied 7 months ago

http://www.americanbar.org/groups/professional_responsibility/commission_multidisciplinary_practice/mdpappendixc.html

"In 1999, a federal district court in Texas similarly dealt with an issue of potential unauthorized practice of law in regard to Parsons Technology, Inc.’s Quicken Family Lawyer software–software that contained over one hundred legal forms for at-home use.*****held that the software constituted the unauthorized practice of law despite its caution that the information provided was not individualized, and that personal judgment should be utilized in deciding whether to consult a lawyer. 11 However, the Texas Legislature soon overturned the court’s decision when it passed a statute declaring that as long as a website, book, or software program “clearly and conspicuously” stated that it was not a substitute for the advice of a lawyer, the product would not be included within the meaning of the “practice of law;” 12 therefore, neither its production, distribution, nor use could be said to be an unauthorized practice of law. 13 Following this legislative enactment, the Fifth Circuit Court of Appeals vacated the district court’s injunction on the Quicken Family Lawyer software. 14

Not all states agree with Texas on the definition of the practice of law, 15 which is one reason LegalZoom remains susceptible to the class action lawsuits it currently faces. 16 It is also possible that lawyers have tried to challenge LegalZoom based on a desire to protect the public from potentially damaging legal products. 17 But, perhaps more realistically, attorneys with specialized practices–such as estate planning–may want to protect their practices against more affordable competitors, namely purveyors of online legal forms. 18This Comment addresses whether online, do-it-yourself legal services comply with today’s ethical guidelines, or if today’s ethical rules even have an answer to this quasi-practice of law.

Part I of this Comment summarizes the practices of online, do-it-yourself legal products–which are available to the general public–and discusses in particular the wills and trusts services offered by LegalZoom. Part II considers the recent ABA Formal Opinion 10-457 regarding the ethical use of websites, and the relevant Model Rules, as they apply to these types of online do-it-yourself legal services. Part III proposes legislation to deal with the discrepancies between the online practice of law and the concerns of laypeople and lawyers alike..." http://www.chapmanlawreview.com/archives/69

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Business Lawyer: Attorney2, Attorney replied 7 months ago

"Comment on Rule 5.7

Law Firms And Associations
Rule 5.7 Responsibilities Regarding Law-Related Services - Comment

[1] When a lawyer performs law-related services or controls an organization that does so, there exists the potential for ethical problems. Principal among these is the possibility that the person for whom the law-related services are performed fails to understand that the services may not carry with them the protections normally afforded as part of the client-lawyer relationship. The recipient of the law-related services may expect, for example, that the protection of client confidences, prohibitions against representation of persons with conflicting interests, and obligations of a lawyer to maintain professional independence apply to the provision of law-related services when that may not be the case.

[2] Rule 5.7 applies to the provision of law-related services by a lawyer even when the lawyer does not provide any legal services to the person for whom the law-related services are performed and whether the law-related services are performed through a law firm or a separate entity. The Rule identifies the circumstances in which all of the Rules of Professional Conduct apply to the provision of law-related services. Even when those circumstances do not exist, however, the conduct of a lawyer involved in the provision of law-related services is subject to those Rules that apply generally to lawyer conduct, regardless of whether the conduct involves the provision of legal services. See, e.g., Rule 8.4.

[3] When law-related services are provided by a lawyer under circumstances that are not distinct from the lawyer's provision of legal services to clients, the lawyer in providing the law-related services must adhere to the requirements of the Rules of Professional Conduct as provided in paragraph (a)(1). Even when the law-related and legal services are provided in circumstances that are distinct from each other, for example through separate entities or different support staff within the law firm, the Rules of Professional Conduct apply to the lawyer as provided in paragraph (a)(2) unless the lawyer takes reasonable measures to assure that the recipient of the law-related services knows that the services are not legal services and that the protections of the client-lawyer relationship do not apply.

[4] Law-related services also may be provided through an entity that is distinct from that through which the lawyer provides legal services. If the lawyer individually or with others has control of such an entity's operations, the Rule requires the lawyer to take reasonable measures to assure that each person using the services of the entity knows that the services provided by the entity are not legal services and that the Rules of Professional Conduct that relate to the client-lawyer relationship do not apply. A lawyer's control of an entity extends to the ability to direct its operation. Whether a lawyer has such control will depend upon the circumstances of the particular case.

[5] When a client-lawyer relationship exists with a person who is referred by a lawyer to a separate law-related service entity controlled by the lawyer, individually or with others, the lawyer must comply with Rule 1.8(a).

[6] In taking the reasonable measures referred to in paragraph (a)(2) to assure that a person using law-related services understands the practical effect or significance of the inapplicability of the Rules of Professional Conduct, the lawyer should communicate to the person receiving the law-related services, in a manner sufficient to assure that the person understands the significance of the fact, that the relationship of the person to the business entity will not be a client-lawyer relationship. The communication should be made before entering into an agreement for provision of or providing law-related services, and preferably should be in writing.

[7] The burden is upon the lawyer to show that the lawyer has taken reasonable measures under the circumstances to communicate the desired understanding. For instance, a sophisticated user of law-related services, such as a publicly held corporation, may require a lesser explanation than someone unaccustomed to making distinctions between legal services and law-related services, such as an individual seeking tax advice from a lawyer-accountant or investigative services in connection with a lawsuit.

[8] Regardless of the sophistication of potential recipients of law-related services, a lawyer should take special care to keep separate the provision of law-related and legal services in order to minimize the risk that the recipient will assume that the law-related services are legal services. The risk of such confusion is especially acute when the lawyer renders both types of services with respect to the same matter. Under some circumstances the legal and law-related services may be so closely entwined that they cannot be distinguished from each other, and the requirement of disclosure and consultation imposed by paragraph (a)(2) of the Rule cannot be met. In such a case a lawyer will be responsible for assuring that both the lawyer's conduct and, to the extent required by Rule 5.3, that of nonlawyer employees in the distinct entity that the lawyer controls complies in all respects with the Rules of Professional Conduct.

[9] A broad range of economic and other interests of clients may be served by lawyers' engaging in the delivery of law-related services. Examples of law-related services include providing title insurance, financial planning, accounting, trust services, real estate counseling, legislative lobbying, economic analysis, social work, psychological counseling, tax preparation, and patent, medical or environmental consulting.

[10] When a lawyer is obliged to accord the recipients of such services the protections of those Rules that apply to the client-lawyer relationship, the lawyer must take special care to heed the proscriptions of the Rules addressing conflict of interest (Rules 1.7 through 1.11, especially Rules 1.7(a)(2) and 1.8(a), (b) and (f)), and to scrupulously adhere to the requirements of Rule 1.6 relating to disclosure of confidential information. The promotion of the law-related services must also in all respects comply with Rules 7.1 through 7.3, dealing with advertising and solicitation. In that regard, lawyers should take special care to identify the obligations that may be imposed as a result of a jurisdiction's decisional law.

[11] When the full protections of all of the Rules of Professional Conduct do not apply to the provision of law-related services, principles of law external to the Rules, for example, the law of principal and agent, govern the legal duties owed to those receiving the services. Those other legal principles may establish a different degree of protection for the recipient with respect to confidentiality of information, conflicts of interest and permissible business relationships with clients. See also Rule 8.4 (Misconduct)." http://www.americanbar.org/groups/professional_responsibility/publications/model_rules_of_professional_conduct/rule_5_7_responsibilities_regarding_law_related_services/comment_on_rule_5_7.html

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Customer reply replied 7 months ago
I am able to look up the regulations myself, but wanted a expert legal professional to summarize the essential points.1. First, please confirm it is acceptable/legal for my law firm to offer ancillary, law-related services through the existing law firm, as well as through a SEPARATE organization.2. If it is done through a SEPARATE organization, then please confirm it is possible for the owners of the separate organization to consist of both lawyers and non-lawyers (since this is not a law firm).3. If we want to offer the ancillary, law-related services through an organization that is SEPARATE from the existing law firm, what procedures/precautions would we have to take to comply with the ethics rules?i.e., marketing rules, rules pertaining to disclosure and disclaimers, etc.
Business Lawyer: Attorney2, Attorney replied 7 months ago

I apologize if there was a misunderstanding on the terms of service of the site. We can only answer general question with general information. If you need an opinion specific to your situation the site does not provide this service. http://ww2.justanswer.com/terms-service-0

I can ask the site to refund you or opt out.

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