FLORIDA BAR ETHICS OPINION
July 15, 1995
Advisory ethics opinions are not binding.
An attorney’s proposed involvement with a corporation that represents clients in securities
arbitration matters would be unethical due to problems concerning conflicts of interest, solicitation,
fee-splitting, and assisting the unauthorized practice of law.
Note: Nonlawyers retained for compensation to represent investors in securities arbitrations
are engaged in the unauthorized practice of law. See The Florida Bar re: Advisory Opinion Nonlawyer Representation in Securities Arbitration, 696 So.2d 1178 (Fla. 1997).
4-1.2, 4-1.4, 4-1.5(a), 4-1.7(b), 4-5.4(a), 4-5.4(b), 4-5.5, 4-7.1 through 4-7.8,
61-1, 66-44, 67-14, 67-15, 70-18
The Florida Bar re: Advisory Opinion - Nonlawyer Preparation of Living Trusts,
613 So. 2d 426 (Fla. 1992)
A member of the Florida Bar requests an advisory opinion about an affiliation with a
nonlawyer company to handle securities arbitrations.
The inquiring attorney wishes to enter into a relationship with a lay company that represents
clients in securities arbitration. The company will obtain clients and pay the inquirer to represent
the clients in negotiation and arbitration (if necessary). The company will pay the inquirer in the
form of a retainer and a percentage of the company’s contingent fee. The company would also
provide the attorney with information regarding the client’s claim and a prepared “Statement of
Claim” for the inquirer to file. The company also pays for expert witness and audit services for the
client, and, in some cases, costs of arbitration.
The inquirer wishes to know if it would be proper to enter into this relationship.
The inquirer’s proposal raises numerous issues regarding the Rules of Professional Conduct.
First, the attorney-client relationship must be a direct one. See Florida Ethics Opinions 61-1, 67-14,
and 67-15. An attorney must have direct communication with the clients and take direction from
the clients. See Rules 4-1.4 and 4-1.2, Rules of Professional Conduct. The role of the nonattorney
in gathering information and preparing statements of claim in the inquirer’s proposal may be a
barrier to that direct relationship.
The proposal also raises the question of prohibited solicitation. An attorney may not solicit
business through direct contact with a potential client, and he may not allow another to solicit legal
business on his behalf. See Rules 4-7.4(a) and 4-8.4(a), Rules of Professional Conduct. The
nonattorney may be soliciting business for the inquirer through direct contact with potential clients
in the inquirer’s proposal. Rule 4-1.5(a) provides that “[a]n attorney shall not enter into an
agreement for, charge, or collect ... a fee generated by employment that was obtained through
advertising or solicitation not in compliance with the Rules Regulating The Florida Bar.” Any
advertising of the company would have to follow the Rules of Professional Conduct regarding
attorney advertising (Rules 4-7.1 through 4-7.8, Rules of Professional Conduct).
The business arrangement also appears to interfere with the client’s right to choose his own
attorney, since it appears that the nonattorney will actually determine who will represent the client
in negotiation and at the arbitration. See Florida Ethics Opinions 66-44 [withdrawn] and 70-18. The
proposal also implicates rules prohibiting assisting the unauthorized practice of law and splitting
fees with nonattorneys. See Rules 4-5.4(a) and (b) and Rule 4-5.5, Rules of Professional Conduct.
The inquirer should also consider whether he may have some personal conflict in
representing the clients given his relationship with the company. See Rule 4-1.7(b), Rules of
Professional Conduct. In a similar arrangement regarding living trust preparation, the Florida
Supreme Court stated, “If the lawyer is employed by the corporation selling the living trust rather
than by the client, then the lawyer’s duty of loyalty to the client could be compromised.” The
Florida Bar re: Advisory Opinion - Nonlawyer Preparation of Living Trusts, 613 So. 2d 426 (Fla.
1992). The Court went on to say, “In light of this duty of loyalty to the client, a lawyer who
assembles, reviews, executes, and funds a living trust document should be an independent counsel
paid by the client and representing the client’s interests alone.” Id.
In short, it would be improper for the inquirer to enter into this proposed arrangement in
light of the considerations discussed above.