Attorney Providing Limited Telephone Consultation for a Fee for Employees of a Company Providing this Service as an Employee Benefit.

You have requested an Unauthorized Practice of Law advisory opinion involving a corporation which employs attorneys to participate in a legal services plan, a fringe benefit which participating employers offer to their employees. The legal services plan offers assistance and counseling service to the employees (and their dependents) of the participating employers. Under the plan, a local attorney will provide telephone legal consultation to an employee or dependent with a cap of one half hour for each call. The plan pays the attorney $15.00 for each telephone consultation, and the attorney may not charge any additional fee to the employee/dependent nor his or her employer.

The attorney is a private practitioner and is an independent contractor, not an employee of the plan or its members. The attorney does not offer opinions in matters which relate to the employer-employee relationship, including worker's compensation, disability, wrongful discharge or any other legal matters which might create a conflict between employer and employee. The attorney agrees that he or she will not undertake to represent the employee in any legal matter in which the employer or the plan are adverse parties.

The Committee directs your attention to prior Unauthorized Practice of Law Opinion No. 57, approved by the Virginia Supreme Court on December 2, 1983, which concluded that, since a lay corporation cannot practice law, no lay corporation may provide legal services to its customers. In applying specific provisions of the Virginia Code and the Court's earlier decision in Richmond Ass'n of Credit Men v. Bar Assoc., 167 Va. 327 (1937), the opinion further concluded that it would be improper for any attorney employee of a lay corporation to assist the lay corporation in the unauthorized practice of law.

The Committee opines, under the circumstances presented, that an attorney-client relationship exists between the attorney and the caller, but no such relationship exists between the attorney and the corporation administering the plan or its employer participants. Therefore, the Committee believes that the non-lawyer corporation administering the legal services plan does not engage in the practice of law by contracting with private attorneys to provide legal advice to the users of such service. Moreover, a prepaid legal services plan organized and licensed by the State Corporation Commission pursuant to Virginia Code §38.2-4400, et.seq., is a lawful activity. Consequently, the private attorney participating as an independent contractor in a legal services plan organized pursuant to Virginia Code §38.2-4400 et. seq. does not engage in, nor aid the non-lawyer corporation in, the unauthorized practice of law as prohibited by DR 3-101(A).

This opinion is restricted to the unauthorized practice of law implications the situation presents and does not attempt to analyze any ethical issues raised by the foregoing legal services plan. Legal ethics issues arising out of the attorney’s participation in the plan are beyond the purview of this Committee and are more properly in the province of the Virginia State Bar’s Standing Committee on Legal Ethics. Nevertheless, this Committee directs your attention to DR 5-105 concerning possible conflicts in representing multiple parties, and DR 5-106 concerning acceptance of employment where third parties other than the represented client are responsible for payment of legal fees. The attorney must be careful to screen for conflicts because the telephone consultations may involve legal matters in which the attorney is already representing a party adverse to the caller.

The Committee also believes that Paragraph 5[1] of the employment agreement must not be construed as requiring the attorney to turn over, for corporate review, any client files, consultation notes, or other documents identifying the callers. The disclosure of such information, without the callerís prior consent, would violate DR 4-101, which prohibits an attorney from revealing client confidences and secrets.[2]

[DRs 3-101(A), 4-101, 5-105, 5-106; UPL OP. #57; Virginia Code §38.2-4400, et. seq.; Richmond Ass'n of Credit Men v. Bar Assoc., 167 Va. 327 (1937)]

Committee Opinion
July 31, 1995

[1] Paragraph 5 of the "Telephone Intake Attorney Agreement" states:

For [the company's] quality control efforts and market analysis, Intake Attorney agrees to maintain and compile reports pursuant to [the company's] procedures.

[2] For example, in Legal Ethics Opinion No. 1300, the Standing Committee on Legal Ethics opined that it would be improper under DR 4-101 for a legal aid office to comply with a federal governmental agency request for information revealing the names and addresses of clients represented by that legal aid office unless the clients consented to the disclosure.

Updated: Aug 28, 2006