The Florida Bar

Statement By Edith Osman

Former President of The Florida Bar
On Multidisciplinary Practice

(The Florida Bar's Report and Recommendation 10b)
Monday, August 9, 1999

The Florida Bar submitted a resolution to the ABA in May 1999, because The Florida Bar understood that the ABA Multidisciplinary Practice Commission report was going to be published as a report and recommendation to the ABA for vote at the August meeting of the House of Delegates. The Florida Bar determined that it was impossible for bar organizations to obtain, digest and respond to the ABA Multidisciplinary Practice Commission report and recommendation in time for the August vote in the House of Delegates, ultimately submitting Report and Recommendation 10B, which urges that no changes be made to the Rules of Professional Conduct without further analysis. The Florida Bar is concerned that core values of the legal profession not be impaired by any form of practice: core values such as absolute loyalty to clients, confidentiality of client matters, and independence of professional judgment.

The historical prohibition against sharing fees with nonlawyers was promulgated to protect attorneys' independent professional judgment and their loyalty to clients. If nonlawyers are partners or share fees with attorneys, they may direct or control an attorney's representation of the client. If nonlawyers control a multidisciplinary practice, as recommended in the ABA Multidisciplinary Practice Commission report, it is unrealistic to expect that attorneys' independent professional judgment will not be affected by the nonlawyers who employ them and set their salaries and benefits.

The Florida Bar additionally is concerned that the ABA Multidisciplinary Practice Commission report only superficially addresses issues relating to the unlicensed practice of law, a subject of grave concern of many state bar organizations. The Florida Bar believes that a study of multidisciplinary practice is incomplete if it fails to address unlicensed practice of law issues. The report ignores the fact that attorneys in most jurisdictions are prohibited from assisting the unlicensed practice of law. In Florida, as in many states, a corporation is prohibited from offering legal services, as the unlicensed practice of law. The ABA Multidisciplinary Practice Commission report fails to adequately examine this issue.

The ABA Multidisciplinary Practice report also did not appear to analyze the differences between attorneys and accountants. Accountants have rules regulating their conduct, but there are many differences between rules which apply to accountants and rules regulating attorney conduct. Accountants, for example, are required to disclose information in their attest function. Attorneys, on the other hand, are obligated to keep information relating to a representation confidential. The report does not address this fundamental difference between the legal and accounting professions. Accountants also do not have as stringent regulations regarding conflicts of interest as attorneys. The ABA Multidisciplinary Practice report recommends that all MDPs be required to follow the rules which regulate attorney conduct. The report does not consider whether an MDP which requires nonlawyers to follow the Rules of Professional Conduct would be at all attractive to the nonlawyers would join them. Accountant s are unlikely to join an MDP which requires them to decline clients because of a conflict under the attorney rules, or which requires them to keep confidential information that accountants are required to disclose in their attest function.

The ABA Multidisciplinary Practice report also did not appear to analyze relationships between attorneys and any other professionals besides accountants. Professionals other than accountants may have rules that conflict even more with the rules governing attorney conduct, or they may have no rules at all. The ABA Multidisciplinary Practice Commission report does not limit MDPs to other professionals. Accountants, who have their own rules, do not want to be bound by the Rules of Professional Conduct governing attorney conduct. It is naive to suppose that nonprofessionals, who are not required to follow rules regarding conflicts, confidentiality, and the like, will be eager to follow the rules governing attorney conduct. The Florida Bar has received inquiries from attorneys who wish to either own or have partnerships with the following: used car lots, coffee shops, MRI Center, physicians, accountants, financial planners, guardians, elder care helper, title insurance companies, stock brok ers, patent research companies, investigators, dentists, mental health counselors, mediators, arbitrators, lease audit firms, paralegals, and sports agents, to name but a few. There is no indication that any of these individuals have the slightest interest in being bound by the rules regulating attorneys.

Finally, the ABA Multidisciplinary Practice report describes a regulatory system that is ineffective and unrealistic. The only requirement of a nonlawyer controlled MDP is a yearly certification that the MDP has adopted procedures that comply with the Rules of Professional Conduct and that the MDP will not impair an attorney's independent professional judgment. Additionally, the MDP will submit to an audit, if requested. The only remedy for noncompliance is that permission to engage in MDP will be withdrawn. This regulatory scheme has no teeth. There is no real oversight of MDPs under this proposal, and it suggests no procedures for MDPs to follow to be in compliance with the Rules of Professional Conduct.

The Florida Bar appointed a committee to study the issues of multidisciplinary practice and ancillary business two years ago. That committee has held a public hearing, sponsored a seminar, hosted an All Bar Conference, and gathered thousands of pages of documents from the ABA, other states, and other learned sources relating to these topics. The committee has currently split into subcommittees: one to draft a report and recommendation in favor of allowing multidisciplinary practice, which will include all the attendant implications, one to draft a report and recommendation against allowing multidisciplinary practice, with attendant implications, and one to draft a rule regulating ancillary businesses of attorneys, which is the opposite side of the coin of multidisciplinary practice.

After two years of grappling with this issue, The Florida Bar Committee on Multidisciplinary Practice and Ancillary Business is not prepared to make a recommendation to the Florida Bar Board of Governors. The Florida Bar needs more time to consider the issue in order to reach an intelligent and logical position. The Florida Bar is well aware of the fact that many state and local bar organizations have not yet started looking at the issue, so they cannot possibly be ready to make a decision. This decision is too important to the future of our profession to force a vote at this time.

Therefore, The Florida Bar is requesting that no vote be taken to change to the Rules of Professional Conduct to allow multidisciplinary practice at this time. Many other state bar organizations have taken the same position. The Florida Bar asks that sweeping change, for that is the nature of the recommendation of the ABA Multidisciplinary Practice Commission recommendation, not be made without allowing the states sufficient time to absorb the information and formulate their own response to the recommendation.

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[Revised: 06-06-2011]