Current and Timely Information and Analysis About
California Attorney Ethics in Practice

Legal ethics audits.

Your Ethical Duties to Plan for Law Practice Succession

Unlike some states, California does not have specific legal ethics rules that require attorneys to adopt a law practice succession plan, there are several Rules of Professional Conduct that impose equivalent duties to plan.  It’s not always easy to think about circumstances that could render you unable to continue practicing law–accidents, illness, disability, planned or unplanned retirement, or untimely death– but these events do occur.  Under any of these circumstances, your clients’ interests, as well as your own, must be protected.

Every California has a duty of competence under CRPC Rule 3-110, which means that you have an obligation to take reasonable steps to ensure that client matters will not be neglected in the event of death or disability.  Unexpected events could have serious impacts on your clients.  Important client matters, such as court dates, statutes of limitations, or document filings, could be neglected if you fail to plan for these contingencies.  California attorneys have a separate duty to keep clients informed of significant developments, under CRPC Rule 3-500.  This rule has been interpreted to impose duties on attorneys to advise clients regarding change of employment, and generally also implies a duty to plan for client communications in the event of your death or incapacity.  You also have a fiduciary duty and duty of loyalty to your clients, which means you must protect your clients’ interests in various contingent circumstances, including your death or incapacity.   CRPC Rule 3-700, related to termination of employment, provides an analogous scenario.  That rules requires attorneys to take reasonable steps to avoid reasonably foreseeable prejudice to client related situation in which they will no longer be able to represent client.

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5 Law Firm Systems to Review for 2017

Properly managing a modern and profitable law firm in 2017 and beyond requires balancing vigilance and innovation.  The legal headlines are full of emerging risks to law firms, including confidentiality breaches and technology disasters.  The legal headlines are also full of competitive risks for law firms.  Passive management of a law firm, even a successful one, is not a good strategy.  You may not change, but the marketplace surely will.

January seems like the right time of year to face up to the things we should be doing, but aren’t.  Here are 5 firm systems that you should review critically in 2017, and annually:

  1. Firm Management. Consider whether your Partnership Agreement or other organizing documents are up to date, with detailed compensation structures that incentivize partners and other attorneys at the firm to think about and comply with all ethical requirements.  Analyze governance policies to ensure that you prioritize compliance with legal ethics requirements, and to ensure an appropriate response in the event of an ethics question or a potential ethics issue.
  1. Clients and Matters. Analyze technology systems for identifying and resolving client conflicts, protecting client confidentiality, and documenting each of the firm’s engagements.  Any system is only as good as the information that goes into it and only works if it is used consistently and uniformly.  Many conflict issues arise from latent conflicts (a subsidiary vs. parent conflict, for example) that may not be obvious on the face of a conflict search.  Ensure that your systems are properly set up, and are being used, and used in the right way.
  1. Calendaring and Deadlines. A sophisticated calendaring system to monitor all firm deadlines is essential.  Take advantage of new technology to integrate calendaring functions into attorney workflow, and to ensure accuracy.  Ensure that your system is durable and can be accessed in the event of an emergency or significant disruption.
  1. Information Management. Client confidentiality in California is not a gray area: you must keep client information confidential.  This means that your firm must have sufficient systems in place to ensure that information is secure.  Analyze whether your information security policies are sufficient (what rules exist regarding laptop security, thumb drives, cloud data, for example).  Analyze whether attorneys and staff are following the policies.  Consider whether your firm’s technology is sufficient to prevent a breach, and/or to respond to one if it occurs.
  1. Financial Management. Review your trust accounting procedures and safeguards to ensure that client funds are handled properly.  The rules are quite clear about what you can, and cannot, do with these funds.  Ensure that your attorneys and staff are properly trained to identify appropriate issues and to handle these items properly.  Separately, consider any alternative fee arrangement from an ethical perspective: does the arrangement place the client’s interest in conflict with yours?  does the arrangement incentive something that could be an ethical concern (e.g., incentivizing attorneys to spend as little time as possible on a case)?  is the arrangement properly documented, to avoid ambiguity when bills come due?

Tracking Proposed Revisions to California’s Rules of Professional Responsibility

California’s Commission for the Revision of the Rules of Professional Responsibility has proposed 68 new and amended rules for attorneys, and is seeking public comment on the  proposed rules.  California is the only state that whose professional responsibility rules do not track the ABA Model Rules.  The Commission has issued an Executive Summary detailing the proposed and amended rules, comments, and dissenting views.  The Commission also issued a detailed list of rule revisions considered, but rejected.  Among other things, the proposed rules include suggested revisions to rules related to personal relationships with clients, conflicts imputed through a law firm, attorney’s fees, and handling clients with diminished capacity.  The public comment period expires September 27.

5 Reasons to Seek Independent Outside Ethics Counsel

Attorneys tend to view ethics compliance as something very personal, and firms correctly views ethics issues as an internal matter.  Attorneys would not hesitate to engage outside counsel if a legal malpractice claim arose, but many do not yet have dedicated outside ethics counsel to advise as part of ongoing daily firm operations.  Increasingly, there are compelling reasons for attorneys and firms to engage outside independent ethics counsel, as a confidential resource in the event that an ethical issue arises, to advise on ethics compliance systems, and to help prevent ethics problems.More

Can You Make Ethics Compliance a Competitive Advantage?

Among the people who think about the future of law practice and of lawyers, there is a developing recognition that ethics compliance can be a powerful competitive advantage in practice. Most lawyers view ethics compliance as a necessary (it is about as necessary as it gets) part of practicing law, but would you characterize ethics as potential competitive advantage for a law firm?

Well, you should. Ethics compliance, more specifically the demonstrated commitment to the practice of law at the highest ethical standards, is good business for law firms. This hardly needs explaining: if you hold yourself to high ethical standards, you will be better at what you do, more careful, and less likely to become engaged in distracting and potentially career-threatening ethical disputes and controversies. Beyond this, however, ethics compliance can be a unique point of distinction, a source of strong and coherent firm culture, an empowering identity for members of the firm, and a powerful symbol to clients that you are fair and wise, and exercise good judgment.  Isn’t that what you are selling as a lawyer?More

5 Legal Ethics Compliance Systems to Review Today

Ensuring that every element of your practice complies with the highest ethical standards is not just required, it is also good business. Or, to be more specific, permitting an ethical lapse is very, very bad business. A review of these systems may lead to more questions than answers. But asking the right questions is the critical first step. Consider these 5 critical compliance systems in your law practice: firm management; clients and matter management; calendaring and deadlines; information management; and financial management.

In your firm, are all of these systems in place and performing as they should, as part of a complete ethics compliance protocol?More

Is Your Law Practice Due for a Legal Ethics Audit?

As a practicing lawyer, you may have missed an emerging consensus on something that affects your practice every day: your firm should regularly conduct a detailed ethics audit.

The changing legal landscape has created its own ethics challenges. Technology has made it easier for boutique firms to exist, and to compete against large firms. But large firms typically have dedicated in-house attorneys—and significant resources—focused on compliance with ethics rules. These costs are spread over hundreds or thousands of lawyers. If not properly managed, ethics compliance can become a competitive disadvantage for small and mid-sized firms.

For practicing attorneys, the legal world is changing rapidly. Understanding and properly applying the ethics rules is increasingly important. Some have even suggested that it will be a critical way to establish a competitive advantage as the future of law unfolds.
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Fearing Fear Itself in Legal Ethics

Many practicing attorneys could summarize their legal ethics compass with precisely two time-worn bromides from law school.  Don’t sleep with your clients. Don’t commingle your clients’ funds.

These are still words to live by.  So if you are complying, then keep up the good work. These concepts stuck with us because law schools do an excellent—and necessary—job of scaring students into acknowledging the critical importance of ethics rules.  As a result, most practicing attorneys have a robust, fear-based relationship with legal ethics. And when it comes to legal ethics, fear can be a very good thing: it can make you slow down, ask the right questions, view circumstances objectively, and act appropriately. But fear alone can also lead to denial, rash behavior, unchecked emotion, biases, and mistakes. More