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July 15, 2017
Opinion addresses work with out-of-state firms with nonlawyer owners

Florida Bar members can work on cases with out-of-state lawyers in firms that may have nonlawyer owners as long as the Bar members’ professional independence is not influenced.

The Bar’s Professional Ethics Committee reached that conclusion in Proposed Advisory Opinion 17-1, which it approved at its June 23 meeting at the Bar’s Annual Convention.

The issue was raised by the Vision 2016 commission which noted while Florida prohibits nonlawyers from owning an interest in law firms (because, among other reasons, lawyers may not split fees with nonlawyers), other jurisdictions are different. At the moment, both Washington, D.C. and the state of Washington allow nonlawyers to have a financial interest in a law firm.

The question posed by Vision 2016, and which the Bar Board of Governors instructed the PEC to consider, is what happens when a client hires to work on his or her legal matter a Florida lawyer along with a lawyer from an out-of-state firm where a nonlawyer has a financial stake.

The PEC concluded, as did an ABA opinion on the subject, that a Bar member can work with the out-of-state lawyer as long as the Bar member’s independent judgement is not affected.

“A Florida Bar member should not be subject to discipline merely because a nonlawyer ultimately may receive some part of the out-of-state lawyer’s fee solely by virtue of being an owner of the out-of-state law firm. The Florida Bar member has no control over the organization and ownership of the out-of-state firm. The out-of-state law firm may be organized in accordance with the rules of its own jurisdiction. The fact that the nonlawyer ownership would not be permitted in Florida should not impact what the out-of-state lawyer is permitted to do under the rules of that jurisdiction. To opine otherwise unnecessarily places Florida Bar members at risk and deprives clients of counsel of their own choosing from other jurisdictions,” the proposed opinion said.

The opinion also cited ABA Formal Opinion 464 on the lawyer’s duty to “maintain professional independence,” which says, “Even if the other law firm may be governed by different rules regarding relationships with nonlawyers, a lawyer must not permit a nonlawyer in the other firm to interfere with the lawyer’s own independent professional judgment. As noted above, the actual risk of improper influence is minimal. But the prohibition against improper nonlawyer influence continues regardless of the fee arrangement.”

The opinion notes that it does not address a Bar member becoming a partner, associate, or entering into some other formal arrangement with a firm that has nonlawyer ownership in its home jurisdiction and complies with those rules, or Bar members admitted to practice in those other jurisdictions who may join a firm with nonlawyer owners.

The full text of the opinion is published in an official notice here.

[Revised: 05-21-2018]