March 25, 1974
Ethics Opinon 1974-7
SUBJECT: GROUP LEGAL SERVICES FOR MEMBERS OF A UNION
An attorney has been asked to perform group legal services, on a retainer basis, for the members of a local credit union. He has inquired into the ethical status of rendering such services.
The proposed legal services appear to fall squarely into those authorized by Rule 20 of the Rules of Professional Conduct of the State Bar of California. If the services are rendered on the basis therein provided, the practice would be ethical.
Rule 2 of the California Rules of Professional Conduct adopted by the Board of Governors of the State Bar of California prohibits an attorney from soliciting professional employment by advertisement or otherwise. The volunteering of counsel or advice is prescribed under most circumstances as is the circulation of any form of written or oral advertisement publicizing the attorney's professional affiliation. Notable exceptions, not material here, are defined.
Rule 3 of said Rules provides in pertinent part, as follows:
"A member of the State Bar shall not knowingly accept professional employment offered to him as a result of or as an incident to the activities of any person not so licensed or of any association or corporation that for compensation controls, directs or influences such employment . . ."
Rule 20 of the Rules of Professional Conduct appears to be addressed to legitimate exceptions to Rules 2 and 3. It provides, in full, as follows:
"The furnishing of legal services by a member of the State Bar pursuant to an arrangement for the provision of such services to the individual member of a group, as herein defined, at the request of such group, is not of itself in violation of Rules 2 or 3 of these Rules of Professional Conduct if the arrangement:
1. Permits any member of the group to obtain legal services, independently of the arrangement from any attorney of his choice.
2. Is so administered and operated as to prevent
(a) Such group, its agents or any member thereof from interfering with or controlling the performance of the duties of such member of the State Bar to his client.
(b) Such group, its agents or any member thereof from directly or indirectly deriving a profit from or receiving any part of the consideration paid to the member of the State Bar for the rendering of legal services thereunder.
(c) Unlicensed persons from practicing law thereunder, and
(d) All publicizing and soliciting activities concerning the arrangement except by means of simple, dignified announcements setting forth the purposes and activities of the group or the nature and extent of the legal services or both, without any identification of the member or members of the State Bar rendering or to render such services.
"Nothing in this rule shall prohibit a statement in response to individual inquiries as to the identity of the member or members of the State Bar rendering or to render the services giving the name or names, addresses and telephone numbers of such member or members.
"As used in this rule a group means a professional association, trade association, labor union or other nonprofit organization or combination of persons, incorporated or otherwise, whose primary purposes and activities are other than the rendering of legal services.
"A member of the State Bar furnishing legal services pursuant to an arrangement for the provision thereof shall advise the State Bar thereof within 60 days after entering into the same. Thereafter he shall advise the State Bar, on forms provided by it, of the following matters: the name of the group, its address, whether it is incorporated, its primary purposes and activities, the number of its members and a general description of the types of legal services offered pursuant to the arrangement.
"Annually on January 31, he shall report to the State Bar, on forms provided by it, any changes in such matters, and the number of members of the group to whom legal services were rendered during the calendar year. Each report filed pursuant hereto and the information contained therein, except the name and address of the group, the fact that it has an arrangement for the provision of legal services and the names of members of the State Bar providing such services shall be confidential."
On its face, the proposed arrangement might well violate either Rule 2 or Rule 3. To utilize Rule 20, the following prerequisites must be met:
1. The services are requested by the group, not volunteered by the attorney.
2. The identity of the attorney rendering such service is unpublicized.
3. The persons receiving the services are to remain free to secure independent counsel at all times.
4. Fee-splitting or other forms of "kick back" of the consideration paid to the attorney must be avoided.
5. The group for whom the services are rendered must be of a nonlegal, nonprofit nature.
6. Special reporting procedures to the State Bar are observed by the attorney.
Under the facts presented by this inquiry, a Rule 20 exception to Rules 2 and 3 may exist. The attorney has been solicited by the credit union and proposes to render services on a basis whereby "the individual member would be free to go to any attorney of his choosing." So long as the union does not take financial interest in the attorney's activities, the manner of fee payment would not appear to be unethical. At this point, it seems that the major details to be observed are the anti-solicitation rule, 20(2)(d), and the reporting procedures.
This opinion is advisory only. It is not binding upon the State Bar, the Board of Governors, its agents or employees.
EDITOR'S NOTE: Effective 1/1/75, the California Rules of Professional Conduct were superseded by a new set of Rules. Rule 20 has been superseded by Rule 2-104; Rule 2 is now Rules 2-101 through 2-104; Rule 3 is now Rules 2-104 and 3-101 through 3-103.
Disclaimer: This opinion was issued by the Legal Ethics Committee of the San Diego County Bar Association. It is advisory only and is not binding upon any member of the SDCBA, any other member of the State Bar of California, the State Bar of California or its Board of Governors, or any persons or tribunals charged with regulatory responsibilities. The SDCBA, its officers, directors, agents, and the Legal Ethics Committee members assume no responsibility or liability in rendering this opinion.