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MINUTES
OF THE VIRGINIA STATE BAR/
VIRGINIA BAR ASSOCIATION JOINT COMMISSION TO STUDY MULTIDISCIPLINARY PRACTICE Virginia State Bar - 2nd Floor Conference Room Richmond, Virginia The VSB/VBA Joint Commission on Multidisciplinary Practice met in the Second Floor Conference Room of the Eighth & Main Building in Richmond, Virginia, on Tuesday, February 27, 2001, commencing at 10:00 a.m. Commission
members in attendance were: Unable to attend were: Ann T.
Burks Nina E. Olson Thomas
A. Edmonds, VSB Executive Director * Attended
by phone
Mr. Keith initiated discussion on whether a consensus has been formed about MDP. Mr. Keith reviewed the options: 1) do nothing; 2) rigorously enforce UPL and the Rules of Professional Conduct; or 3) attempt to regulate MDP. Mr. Thomas observed that the issue of UPL enforcement is present in each of the options, and presented two questions: 1) how do you level the playing field? and 2) will the accounting profession allow the legal profession to regulate them? Mr. Keith responded that the large accounting firms seem to be trying to operate within our system. Their activity is limited in that they are handling mainly tax matters and not drafting documents. Mr. Middleditch commented that with respect to UPL enforcement, the bar must be able to justify such regulation to the public. If legal services can be performed more efficiently through MDP, some may argue that the regulation of the MDP should be left to the marketplace and the civil justice system. Mr. Middleditch observed that in Sweden there are no UPL rules, only a prohibition against a nonlawyer holding himself out as a lawyer. Mr. Nusbaum warned that the public should not be made to perceive that MDP is for the benefit of lawyers rather than the benefit of the public. The focus, of course, is on legal ethics. Should we bend our ethics rules to yield to the business goals of others? What happens to the public or the protection of clients if MDP is permitted? In short, the basic question is, how do we protect the public, not how do we prevent competition. Mr. Thomas expressed the opinion that it is a mistake to think only in terms of the Big Five. There is a massive, global consolidation of financial and professional services, and Mr. Thomas questioned whether the organized bar has the budget or the will to fight these financial giants. Regarding Mr. Middleditch's remark about the civil justice system as an enforcement tool, Mr. Thomas observed that under the ABA Rules of Professional Conduct the ethics rules may serve as a legal/civil liability standard. Mr. Spahn remarked, however, that the Virginia Rules of Professional Conduct are just the opposite, in that there is express language in the preamble indicating that the RPCs are not to be used as standards of care in legal malpractice cases. This is consistent with case law in Virginia. Mr. Spahn observed that whatever recommendation we make, we must be mindful that this recommendation may or may not be approved by VSB Council. It may prove very difficult to convince Bar Council to make significant changes in the Rules of Professional Conduct or the Unauthorized Practice Rules. Mr. Keith remarked that a fully integrated MDP would be a problem if lawyers working in accounting firms are permitted to represent clients in court. For purposes of discussion at this meeting, Mr. Keith suggested that we take the fully integrated model off the table. Instead, he asked the group to consider the command and control model where professional services by nonlawyers are incidental to the practice of law. This is the DC version of Rule 5.4. Under this model, the lawyers would be able to represent clients in court. On the other hand, lawyers working in a fully integrated MDP would increase the risk, particularly in litigation, of breaching core values. Mr. Middleditch added that in our public relations efforts, the commission should "sell and brand" the core values. In addition, issues concerning UPL enforcement should be addressed and not overlooked. For purposes of discussion, Mr. Keith raised the possibility that lawyers practicing in a fully integrated MDP, such as an accounting firm, could receive a limited license that would enable them to perform all the transactional work, but would not allow them to represent clients in court. The core values in the litigation setting is "where the rubber meets the road." Mr. Rascoe offered his view that the question remains of whether a lawyer can exercise independent judgment, and he felt here should be only one license - either you are a lawyer or your are not. Discussion ensued about the proposed litigation restriction on lawyers working in fully integrated MDPs. No consensus evolved as to whether this proposal would work. Everyone agreed to the basic premise that if MDP is good for the public, then it should be allowed and regulated under an appropriate framework. On the other hand, if MDP does not advance the interests of clients, then it should be restricted or prohibited. Further discussion revolved around three basic types of MDPs: 1) the solely integrated model; 2) the command and control model; and 3) the lawyer-owned model, where lawyers have a majority equity in the firm. There was discussion about how the commission would go about writing a report. Mr. Spahn suggested that the commission obtain all the pro-MDP reports from other states as a starting point. Mr. Keith envisions that each subcommittee will offer some content for the report. There was discussion about whether the report should make a detailed recommendation or should be general and conceptual. The consensus was that the first report to Bar Council should be conceptual and not make any specific recommendations. IV Adjournment The commission concluded its discussion and adjourned the meeting. The commission will reconvene on Tuesday, March 20, 2001, at 10:00 a.m.
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