(Approved June 2, 2000)
Issue: Do the Utah Rules of Professional Conduct prohibit a lawyer licensed to practice in Utah from participating in an association of lawyers that would use joint letterhead, with a disclaimer that the association “is an affiliation of independent attorneys-not a partnership?”
Opinion: A lawyer does not violate the Utah Rules of Professional Conduct if he participates in an association or affiliation of individual lawyers and law firms, provided that he adheres to the applicable rules regarding conflicts of interest and disclosure of confidential information. However, it would be misleading, and therefore a violation of the Rules, for the lawyer to participate in such an association or affiliation if its members were to practice under a common firm name and were to use joint letterhead. The inclusion of a partnership disclaimer would not cure the misleading nature of the letterhead concerning the relationship among the attorneys. Facts: A Utah lawyer desires to associate himself with lawyers who are licensed to practice law in various foreign countries. Under the proposed arrangement, the members of the association would not be partners, but would be independent practitioners. It is not clear from the facts whether the lawyers participating in the association would merely refer clients to each other or whether they would also have some kind of a financial arrangement. The lawyers would use joint letterhead, which would identify the association as follows:
A, B, C & D
A, Admitted: State,Country United Kingdom
B, Admitted: Country European Union
C, Admitted: Country Russia
D, Admitted: State, Country Asia
A,B,C & D is an affiliation of independent attorneys—not a partnership.
Analysis: A lawyer’s communications regarding the lawyer’s services, including the designation of the lawyer’s firm and the lawyer’s letterhead, must comply with the requirements of Rules 7.1, 7.4 and 7.5 of the Rules.
Rule 7.1 states that “A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services.”1Rule 7.5 governs firm names and letterheads, and subsection (d) is applicable to the analysis in this case: “Lawyers may state or imply that they practice in a partnership or other organization only when that is the fact.”2The obligation of the lawyer not to mislead third parties is further delineated by Rule 7.4, which outlines the limits of the lawyer’s communication of his fields of practice and states that, while allowed to indicate that his practice is limited to specific areas of practice, a lawyer cannot communicate that he is a specialist, unless otherwise permitted by the rule.3
The practice of law has evolved from the traditional model of a partnership with a single law office to various, more fluid forms of relationships among lawyers, which range from structures similar in nature to a partnership to arrangements that merely contemplate mutual referrals. It has now become common practice for lawyers to associate or become affiliated with other lawyers or law firms in different states or countries by way of some form of strategic alliance or participation in national or international networks. While these creative forms of association may provide a legitimate service to clients in a shrinking world, nonetheless they remain circumscribed by the Rules. (more…)
(Approved April 25, 1997) Issue No. 1: Is it ethical for an attorney to receive payment for legal services other than in money?
Opinion: The Utah Rules of Professional Conduct permit an attorney to accept payment for legal services in a form other than money. All arrangements for payment of an attorney’s fees, however, must comply with the applicable provisions of the Utah Rules of Professional Conduct concerning fees and the attorney-client relationship. Issue No. 2: Is it ethical for an attorney to barter legal services through a barter exchange?
Opinion: Although an attorney’s bartering of legal services through a barter exchange is not prohibited per se by the Utah Rules of Professional Conduct, such bartering is unethical if the attorney’s conduct or the structure, terms, or conditions of the attorney’s arrangements with the barter exchange violate any of the Utah Rules of Professional Conduct.
Analysis: The request for this opinion asks generally, without presenting specific facts and circumstances, whether attorneys ethically may receive payment for legal services other than in money, such as through barter exchanges. The request also asks whether Utah Ethics Advisory Opinion No. 50, issued August 25, 1978, is still valid, noting that questions concerning an attorney’s participation in barter exchanges are of continuing interest in Utah.
Payment of Attorneys’ Fees Other Than in Money. Nothing in the Utah Rules of Professional Conduct requires that an attorney’s fees be paid in money. The fundamental requirement of the Utah Rules of Professional Conduct is that an attorney’s fees must be reasonable.1
Rule 1.5(b) requires a written communication concerning the basis or rate of an attorney’s fee when the lawyer has not regularly represented the client and it is reasonably foreseeable that total attorneys’ fees to the client will exceed $750.00. A determination of whether the $750.00 threshold will be met in a particular case requires that attorneys’ fees be evaluated in terms of their dollar amount.
However, Rule 1.5 does not require that payment for legal services be made in money. The following official comment to Rule 1.5 states that an attorney may accept property in payment for fees:
A lawyer may accept property in payment for services, such as an ownership interest in an enterprise, providing this does not involve acquisition of a proprietary interest in the cause of action or subject matter of the litigation contrary to Rule 1.8(j). However, a fee paid in property instead of money may be subject to special scrutiny because it involves questions concerning both the value of the services and the lawyer’s special knowledge of the value of the property.
As this comment illustrates, no arrangement for payment of an attorney’s fees, whether in money, property or services, should violate any of the prohibited transaction rules of Rule 1.8. For example, an arrangement for payment of attorneys’ fees that involves the acquisition of a pecuniary interest adverse to a client in violation of Rule 1.8(a) is prohibited. Any arrangement for payment of attorneys’ fees that involves giving the lawyer literary or media rights in violation of Rule 1.8(d) is prohibited. Accepting reimbursement of costs other than in money in a way that provides for an improper advance of costs or expenses could also violate the financial assistance restrictions of Rule 1.8(e). (more…)