ABA Ethics 20/20 Addresses Choice of Law Issue in Virtual Law Practice

Virtual lawyers and multijurisdictional virtual law firms take note: The ABA Commission on Ethics 20/20 has released yet another issues paper proposing changes to ethics rules that could affect the delivery of legal services online.  This newest paper comes from the Working Group on Uniformity, Choice of Law, and Conflicts of Interest and is entitled “Choice of Law in Cross-Border Practice.”  It even includes a sample scenario for the virtual law practice which I’ve posted below.

With lawyers and clients more frequently not located in the same geographic location and many of them communicating and receiving legal services online, this raises the question of which jurisdiction’s ethics laws apply.  The Commission recognizes the need for guidance and greater clarity for a growing number of lawyer and law firms faced with questions about choice of ethics law.

The ABA Model Rule 8.5 regarding choice of ethics provides that the ethics laws will apply based on the location where the lawyer’s conduct occurred or where the main impact of the lawyer’s conduct arose.  Comment 5 to Rule 8.5 states “[w]hen a lawyer’s conduct involves significant contacts with more than one jurisdiction, it may not be clear whether the predominant effect of the lawyer’s conduct will occur in a jurisdiction other than the one in which the conduct occurred. So long as the lawyer’s conduct conforms to the rules of a jurisdiction in which the lawyer reasonably believes the predominant effect will occur, the lawyer shall not be subject to discipline under this Rule.” 

The lawyer delivering legal services online may have an ethical obligation to determine which states’ ethics laws will apply and then to comply with the stricter state’s requirements.  The difficulty comes in determining exactly where the legal representation occurs for the purposes of Rule 8.5(b) when the attorney and client are communicating and the client is receiving the legal services online across jurisdictions.  This is at the heart of this issues paper.   One of the sample scenarios in the paper is a virtual law practice:

Fact Pattern #1: Virtual Law Practices. Susan has a solo practice in State X and advertises her will-writing services on her website, which is accessible anywhere in the world. Most of her clients come from State X, but she occasionally writes wills for individuals who live in nearby State Y. (Susan is not licensed to practice in State Y.) When Susan works for a State Y resident, she communicates via telephone and the Internet, but she does not physically enter State Y. The State Y resident comes to State X to execute the will. With regard to Susan’s website and her work for State Y residents, does State Y have disciplinary authority over Susan under Model Rule 8.5(a)? If so, which jurisdiction’s rules would State Y apply under Rule 8.5(b)? In addition to different advertising rules, the two jurisdictions may, for example, have different conflict of interest rules and rules for fee agreements.

The choice of law issue is one that is not easily answered and the more that the legal profession becomes dependant upon cloud computing and technology to deliver legal services online across geographic borders, it will only become more complex.  Globalization of law firms is not a passing trend. 

Personally, I think the issues discussed in this paper beg for the need for standardization of ethics laws in the U.S.  This is not a new thought.  Rule 8.5 has undergone several debates and transformations back in 1999 and again in 2002 and there are a ton of law review and journal articles written about this Model Rule and the implications on multijurisdicitonal law practice. 

There are several new proposals in the paper for modification of Rule 8.5.  The Commission is seeking comments on the paper by March 15, 2011. 

I’ve been researching this topic lately and will be thinking about how to provide feedback and comments to the Commission on the subject from the perspective of a virtual law practice.  Other issues, such as the dormant commerce clause, may come into play with choice of ethics law.  Anyone with an interest in elawyering and virtual law practice, which should be every legal professional planning on having a pulse in the next ten years, needs to be watching this like a hawk.