Virginia State Bar Unauthorized Practice of Law Opinion 215 (2008)

Brief Summary
The Virginia State Bar Standing Committee on Unauthorized Practice of Law (the “Committee”) has advised that corporate counsel who are licensed and based outside of Virginia may provide legal advice to their employers without contravening the state unauthorized practice of law (“UPL”) statute, even where they provide advice on Virginia law to a branch office located within Virginia.

Complete Summary
The Committee addressed whether a lawyer duly licensed in a United States jurisdiction other than Virginia (a “non-Virginia lawyer”) who are employed as corporate counsel, in-house or general counsel (collectively, “corporate counsel”) of a financial institution, which is chartered under the laws of a state other than Virginia and whose offices are based outside of Virginia, are (1) subject to the corporate counsel registration requirements set forth in Rule 1A:5 of the Rules of the Virginia Supreme Court and (2) engaging in the unauthorized practice of law if they advise the Virginia branch offices of the financial institution on Virginia law, whether from the lawyers’ offices outside of Virginia or when they visit Virginia in person.

The Committee advised that a non-Virginia lawyer does not have to apply for certification under Rule 1A:5 if such lawyer is not physically located in Virginia as his or her base for employment as corporate counsel. Further, the certificate and registration requirements of Rule 1A:5 apply only to non-Virginia lawyers who are working in Virginia as corporate counsel. In the scenario analyzed by the Committee, neither of these circumstances is present.

The Committee then concluded that when non-Virginia lawyers provide advice and counsel regarding Virginia law to employees of their employer located in branches in Virginia, the lawyers are not engaged in the unauthorized practice of law, because they are advising their regular employer, as defined and permitted by Part 6, §1(B)(1) of the Rules of Virginia Supreme Court, which provides that one engages in the “practice of law” when:

* * *

1. One who undertakes for compensation, direct or indirect, to advise another, not his regular employer, in any matter involving the application of legal principles to facts or purposes or desires.
2. One, other than as a regular employee acting for his employer, undertakes, with or without compensation, to prepare for another legal instruments of any character, other than notices or contracts incident to the regular course of conducting a licensing business.

(Emphasis supplied).

In sum, the Committee concluded that under the facts presented, non-Virginia lawyers working as corporate counsel should be exempt from the reach of UPL statue. The Committee also noted that corporate counsel’s activities would neither contravene the state’s temporary practice provisions nor be likely to cause harm to public welfare. In addition, this practice did not require non-Virginia lawyers to appear before a tribunal — something that would require admission pro hac vice.

Significance of Opinion
This opinion does not depart from, but rather clarifies, previous Virginia ethics opinions addressing UPL. It presents a logical and straightforward approach to in-house counsel practices that cross state lines.

This alert has been prepared by Hinshaw & Culbertson LLP to provide information on recent legal developments of interest to our readers. It is not intended to provide legal advice for a specific situation or to create an attorney-client relationship.

Upcoming Events

Hinshaw & Culbertson LLP and The Hildebrandt Institute Present: The Three-Part Law Firm Risk Management Virtual Seminar Series

Last Remaining Seminar:

July 16, 2008, Noon-1:30 pm EST

Speakers
Thomas L. Browne, Lawyers for the Profession® Practice Group, Hinshaw Culbertson LLP
Tom H. Luetkemeyer, Lawyers for the Profession® Practice Group, Hinshaw Culbertson LLP
Dr. Larry R. Richard, Vice President and Head of the Leadership & Organization Development Practice Group, Hildebrandt International

Program Overview
Dealing with “problem” partners has always been a challenge for law firm leaders. In recent years, however, it has also become a serious area of risk exposure as state bars, regulatory agencies, clients, and plaintiff’s lawyers have been increasingly willing to charge firms with accountability for the “lack of supervision” often evidenced in such behaviors.  In this virtual seminar, you will hear three experts ― two professional responsibility lawyers and one lawyer/psychologist ― describe the nature of these risks and offer some practical advice on dealing with these problems. 

Topics to Include

• Ways of identifying “problem” partners before the problems cause serious damage;
• Methods for dealing with impaired or poorly behaving partners that protect the interests of the partners and the firm;
• Circumstances in which “problem” partners must be reported to the local bar;
• Understanding the psychological issues that can give rise to problems and how to short-circuit them;
• Discussing “problem” partner issues with clients; and
• Managing the damage to the firm when and if problems become public.

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Who Should Attend

• Law Firm General Counsel or Firm Counsel
• Director of Research
• Risk Management Partner
• Chairs of Ethics and Conflicts Committees
• Directors of Professional Responsibility and Directors of Conflicts
• Managing Partners
• Executive Directors and Chief Operating Officers
• Senior Insurance Industry Executives with Responsibility for Lawyers Professional Liability Insurance