Differences from ABA Model Rules
|Rule 1.2(c) Limited Scope||Minor Clerical Changes|
|Rule 5.4(a) Fee-Sharing||Significant Changes|
|Rules 5.4(b)-(d) Non-Lawyer Ownership||Minor Clerical Changes|
|Rule 5.5. Unauthorized Practice of Law||Significant Changes|
|Rule 5.7 Law Related Services||Does Not Have|
|Rule 6.5 Limited Scope||Same as Model Rule|
|Rule 7.2(b) Lawyer Referral||Significant Changes|
|Cloud Computing Advisory||No|
|Technology Competency Rules||No|
ABA Rule 1.2(c) (Limited Scope)
Minor clerical changes including “consent after consultation” differing from the Model Rule.
The scope of services to be provided by a lawyer may be limited by agreement with the client or by the terms under which the lawyer’s services are made available to the client. For example, representation provided through a legal aid agency may be subject to limitations on the types of cases the agency handles or, when a lawyer has been retained by an insurer to represent an insured, representation may be limited to matters related to the insurance coverage. In addition, the terms upon which representation is undertaken may exclude specific means that might otherwise be used to accomplish the client’s objectives. Such limitations may exclude actions that the client thinks are too costly or the lawyer regards as repugnant or imprudent.
Although this Rule affords the lawyer and client substantial latitude to limit the representation, the limitation must be reasonable under the circumstances. If, for example, a client’s objective is limited to securing general information about the law the client needs in order to handle a common and typically uncomplicated legal problem, the lawyer and client may agree that the lawyer’s services will be limited to a brief telephone consultation. Such a limitation, however, would not be reasonable if the time allotted was not sufficient to yield advice upon which the client could rely. Although an agreement for a limited representation does not exempt a lawyer from the duty to provide competent representation, the limitation is a factor to be considered when determining the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation. See Rule 1.1 of these Rules.
All agreements concerning a lawyer’s representation of a client must accord with the Rules of Professional Conduct and other law. See, e.g., Rules 1.1, 1.8, and 5.6 of these Rules. Where the client is a fiduciary, the lawyer may be charged with special obligations in dealing with a beneficiary. See, e.g., Rule 42 of the Hawai‘i Probate Rules.
ABA Rule 5.4(a) (Fee-sharing)
Rule 5.4. PROFESSIONAL INDEPENDENCE OF A LAWYER.
(a) A lawyer or law firm shall not share legal fees with a nonlawyer, except that:
(1) an agreement by a lawyer with the lawyer’s firm, partner, or associate may provide for the payment of money, over a reasonable period of time after the lawyer’s death, to the lawyer’s estate or to one or more specified persons;
(2) a lawyer who purchases the practice of a deceased, disabled, or disappeared lawyer may, pursuant to the provisions of Rule 1.17 of these Rules, pay to the estate or other representative of that lawyer the agreed-upon purchase price;
(3) a lawyer or law firm may include nonlawyer employees in a compensation or retirement plan, even though the plan is based in whole or in part on a profit-sharing arrangement;
(4) a lawyer may share court-awarded legal fees with a non-profit organization that employed, retained, or recommended employment of the lawyer in the matter; and
(5) a lawyer who undertakes to complete unfinished legal business of a deceased lawyer may pay to the estate of the deceased lawyer that proportion of the total compensation that fairly represents the services rendered by the deceased lawyer.
The provisions of this Rule express traditional limitations on sharing fees. These limitations are to protect the lawyer’s professional independence of judgment. Where someone other than the client pays the lawyer’s fee or salary, or recommends employment of the lawyer, that arrangement does not modify the lawyer’s obligation to the client. As stated in paragraph (c), such arrangements should not interfere with the lawyer’s professional judgment.
ABA Rule 5.4(b – d) Non-lawyer ownership
Rule 5.4. PROFESSIONAL INDEPENDENCE OF A LAWYER.
(b) A lawyer shall not form a partnership with a nonlawyer if any of the activities of the partnership consist of the practice of law.
(c) A lawyer shall not permit a person who recommends, employs, or pays the lawyer to render legal services for another to direct or regulate the lawyer’s professional judgment in rendering the legal services.
(d) A lawyer shall not practice with, or in the form of, a professional corporation or association authorized to practice law for a profit, if:
(1) a nonlawyer owns any interest therein, except that a fiduciary representative of the estate of a lawyer may hold the stock or interest of the lawyer for a reasonable time during administration;
(2) a nonlawyer is a corporate director or officer thereof or occupies the position of similar responsibility in any form of association other than a corporation; or
(3) a nonlawyer has the right to direct or control the professional judgment of a lawyer.
This Rule also expresses traditional limitations on permitting a third party to direct or regulate the lawyer’s professional judgment in rendering legal services to another. See also Rule 1.8(f) of these Rules (lawyers may accept compensation from a third party as long as there is no interference with the lawyer’s independent professional judgment and the client gives consent after consultation).
Subsection (b) only applies if legal services are provided by the partnership to third persons or entities (i.e., other than to the partnership itself).
ABA Rule 5.5 (UPL)
Rule 5.5. UNAUTHORIZED PRACTICE OF LAW.
A lawyer shall not:
(a) practice law in a jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction; or
(b) assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized practice of law; or
(c) allow any person who has been suspended or disbarred and who maintains a presence in an office where the practice of law is conducted by the lawyer to have any contact with the clients of the lawyer either in person, by telephone, or in writing or to have any contact with persons who have legal dealings with the office either in person, by telephone, or in writing.
The definition of the practice of law is established by law and varies from one jurisdiction to another. Whatever the definition, limiting the practice of law to members of the bar protects the public against rendition of legal services by unqualified persons. Paragraph (b) does not prohibit a lawyer from employing the services of paraprofessionals and delegating functions to them, so long as the lawyer supervises the delegated work and retains responsibility for their work. See Rule 5.3 of these Rules. Likewise, it does not prohibit lawyers from providing professional advice and instruction to nonlawyers whose employment requires knowledge of law; for example, claims adjusters, employees of financial or commercial institutions, social workers, accountants and persons employed in government agencies. In addition, a lawyer may counsel nonlawyers who wish to proceed pro se.
Paragraph (c) prohibits an attorney who employs or otherwise utilizes a lawyer who is suspended or disbarred, or who resigned in lieu of discipline, from allowing that lawyer to have any contact with the attorney’s clients or others who have legal dealing with the attorney’s office. In order to protect the public, strict prohibitions are essential to prevent permissible paralegal activities from crossing the line to giving legal advice, taking fees, or misleading clients and others who deal with the attorney’s office.
In drafting the statutes, the legislature expressly declined to adopt a formal definition of the term “practice of law,” noting that “[a]ttempts to define the practice of law in terms of enumerating the specific types of services that come within the phrase are fruitless because new developments in society, whether legislative, social, or scientific in nature, continually create new concepts and
new legal problems.” Sen. Stand. Comm. Rep. No. 700, in 1955 Senate Journal, at 661; Hse. Stand. Comm. Rep. No. 612, in 1955 House Journal at 783. The legislature recognized that the practice of law is not limited to appearing before the courts. It consists, among other things of the giving of advice, the preparation of any document or the rendition of any service to a third party affecting the legal rights … of such party, where such advice, drafting or rendition of service requires the use of any degree of legal knowledge, skill or advocacy.
Sen. Stand. Comm. Rep. No. 700, in 1955 Senate Journal. at 661 (emphasis added); see also Hse. Stand. Comm. Rep. No. 612, in 1955 House Journal, at 783.
Similarly, while it has explored the concept’s dimensions, this court has never formally defined the term “practice of law.”
ABA Rule 5.7 (Law Related Services)
ABA Rule 6.5 (Court annexed/Non-profit limited scope)
Same as Model Rule.
Legal services organizations, courts, and various nonprofit organizations have established programs through which lawyers provide short-term limited legal services–such as advice or the completion of legal forms–that will assist persons to address their legal problems without further representation by a lawyer. In these programs, such as legal-advice hotlines, advice-only clinics or pro se counseling programs, a client-lawyer relationship is established, but there is no expectation that the lawyer’s representation of the client will continue beyond the limited consultation. Such programs are normally operated under circumstances in which it is not feasible for a lawyer to systematically screen for conflicts of interest as is generally required before undertaking a representation. See, e.g., Rules 1.7, 1.9 and 1.10 of these Rules.
A lawyer who provides short-term limited legal services pursuant to this Rule must secure the client’s consent, after consultation, to the limited scope of the representation. See Rule 1.2(c) of these Rules. If a short-term limited representation would not be reasonable under the circumstances, the lawyer may offer advice to the client but must also advise the client of the need for further assistance of counsel. Except as provided in this Rule, the Rules of Professional Conduct, including Rules 1.6 and 1.9(c), are applicable to the limited representation.
Because a lawyer who is representing a client in the circumstances addressed by this Rule ordinarily is not able to check systematically for conflicts of interest, paragraph (a) requires compliance with Rules 1.7 or 1.9(a) only if the lawyer knows that the representation presents a conflict of interest for the lawyer, and with Rule 1.10 only if the lawyer knows that another lawyer in the lawyer’s firm is disqualified by Rules 1.7 or 1.9(a) in the matter.
Because the limited nature of the services significantly reduces the risk of conflicts of interest with other matters being handled by the lawyer’s firm, paragraph (b) provides that Rule 1.10 is inapplicable to a representation governed by this Rule except as provided by paragraph (a)(2). Paragraph (a)(2) requires the participating lawyer to comply with Rule 1.10 when the lawyer knows that the lawyer’s firm is disqualified by Rules 1.7 or 1.9(a). By virtue of paragraph (b), however, a lawyer’s participation in a short-term limited legal services program will not preclude the lawyer’s firm from undertaking or continuing the representation of a client with interests adverse to a client being represented under the program’s auspices. Nor will the personal disqualification of a lawyer participating in the program be imputed to other lawyers participating in the program.
If, after commencing short-term limited representation in accordance with this Rule, a lawyer undertakes to represent the client in the matter on an ongoing basis, Rules 1.7, 1.9(a) and 1.10 become applicable.
ABA Rule 7.2(b) (Lawyer referral)
Rule 7.2. ADVERTISING.
(b) A lawyer shall not give anything of value to a person for recommending the lawyer’s services except that a lawyer may:
(1) pay the reasonable costs of advertisements or communications permitted by this Rule;
(2) pay the usual charges of a not-for-profit lawyer referral service or qualified legal assistance organization, which charges, in addition to any referral fee, may include a fee calculated as a percentage of legal fees earned by the lawyer to whom the service or organization has referred a matter, provided that any such percentage fee shall be used only to pay the reasonable operating expenses of the service or organization and to fund public service activities of the service or organization, including the delivery of pro bono legal services; and
(3) pay for the purchase of a law practice in accordance with Rule 1.17 of these Rules.
Paying Others to Recommend a Lawyer
Lawyers are not permitted to pay others for channeling professional work. Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this Rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, banner ads, and group advertising. A lawyer may compensate employees, agents, and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff, and website designers. See Rule 5.3 of these Rules for the duties of lawyers and law firms with respect to the conduct of nonlawyers who prepare marketing materials for them.
A lawyer may pay the usual charges of a prepaid legal services plan, not-for-profit lawyer referral service, or qualified legal assistance organization. A prepaid legal service plan is a group legal service plan in which the cost of the services are prepaid by the group member or by some other person or organization on the member’s behalf. It is a plan by which legal services are rendered to individual members of a group identifiable in terms of some common interest and must otherwise satisfy the requirements of Hawai‘i Revised Statutes Chapter 488. A lawyer may also share legal fees with a not-for-profit lawyer referral service that recommended employment of the lawyer in the matter, as permitted by Rule 5.4(a)(4) of these Rules. See Rule 1.0(h) (Terminology) section for the definition of “Qualified legal assistance organization.”
A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer referral service must act reasonably to assure that the activities of the plan or service are compatible with the lawyer’s professional obligations. See Rule 5.3 of these Rules. Legal service plans and lawyer referral services may communicate with prospective clients, but such communication must be in conformity with these Rules. Thus, advertising must not be false or misleading, as would be the case if the communications of a group advertising program or a group legal services plan would mislead prospective clients to think that it was a lawyer referral service sponsored by a state agency or bar association. Nor could the lawyer allow in-person telephonic, or real-time contacts that would violate Rule 7.3 of these Rules.
A lawyer also may agree to refer clients to another lawyer or a nonlawyer professional, in return for the undertaking of that person to refer clients or customers to the lawyer. Such reciprocal referral arrangements must not interfere with the lawyer’s professional judgment as to making referrals or as to providing substantive legal services. See Rules 2.1 and 5.4(c) of these Rules. Except as provided in Rule 1.5(e) of these Rules, a lawyer who receives referrals from a lawyer or nonlawyer professional must not pay anything solely for the referral, but the lawyer does not violate paragraph (b) of this Rule by agreeing to refer clients to the other lawyer or nonlawyer professional, so long as the reciprocal referral agreement is not exclusive and the client is informed of the referral agreement. Conflicts of interest created by such arrangements are governed by Rule 1.7 of these Rules. Reciprocal referral agreements should not be of indefinite duration and should be reviewed periodically to determine whether they comply with these Rules. This Rule does not restrict referrals or divisions of revenues or net income among lawyers within firms comprised of multiple entities.
Office of Disciplinary Counsel v. Au, 113 P.3d 203 (Haw. 2005) (lawyer paid nonlawyer runner 5 percent of fees earned on cases that runner referred);
No opinions available.
Does not require.