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VSB offers complete rewrite of UPL rules

vsb-150x150_mainAs states take a closer look at how they regulate the legal profession, the Virginia State Bar is considering a complete revision of its rules on unauthorized practice of law. The change potentially could relax restrictions on companies that offer to prepare legal documents for a fee.

The change comes amid ongoing debate over alternative and innovative ways to deliver legal services to consumers. Much of the attention has been focused on companies that make available fixed-fee, task-specific legal work.

The proposed rules explicitly would allow the “selling of legal forms.” The existing rules barred non-lawyers from preparing “legal instruments of any character.” Nevertheless, the drafting committee did not specifically discuss the rules’ application to online legal document platforms, one member said.

The old rules were separated into topic areas. The bar’s new approach is to set out a general definition of the practice of law, followed by sections describing exceptions and exclusions. The rules are followed by comments and annotations to explain and provide examples.

The proposed revision is up for comment through July 13.

Year-long effort

The move to rewrite the UPL rules follows a change two years ago in bar procedures for investigating unauthorized law practice. Mindful of guidance on professional regulation from the U.S. Supreme Court, Virginia’s Supreme Court instituted a procedure where a non-lawyer, the Virginia State Bar clerk, serves as a gatekeeper for prosecution of cases of alleged unauthorized practice.

The change ostensibly removed final decision-making authority from lawyers.

The process of changing the rules was set in motion in the spring of last year. Then-VSB president Michael Robinson formed a seven-member committee to revise and update the UPL rules. Chaired by Arlington’s Adam D. Elfenbein, the panel first met on April 25 last year.

The proposed rewrite was published for comment May 22 of this year.

New structure

The current UPL rules are preceded by a two-part discussion about unauthorized practice and the practice of law generally.  Both parts appear in the printed Volume 11 of the Virginia Code. Only the first part appears in the rules as posted on the VSB website.

It was not clear whether the proposed change would eliminate that discussion, which includes a four-item definition of law practice.

The proposed new UPL rules would start by setting out the existing code section that makes the unauthorized practice of law a Class 1 misdemeanor.

The statute language is followed by a revised definition of the practice of law:

  1. Undertake for compensation, direct or indirect, to give advice or counsel to an entity or person in any matter involving the application of legal principles to facts.
  2. Select, draft or complete legal documents or agreements which affect the legal rights of an entity or person.
  3. Represent another entity or person before a tribunal.
  4. Negotiate the legal rights or responsibilities on behalf of another entity or person.

The rules then list 17 exceptions in which law practice is deemed “authorized,” including third-year practice by law students and pro hac vice appearances.

The exceptions are followed by nine exclusions, actions that do not constitute the practice of law. Among these are selling legal forms, acting as a lobbyist and teaching law.

Next follows eight comments, some quite detailed. Two pages are devoted to activities of real estate agents and settlement agents for property transactions.

A series of annotations at the end provides citations and discussion of legal authority on UPL issues.

Clarity was goal

“The old rules were not only out of date, but very confusing,” said committee member Dennis J. Quinn. He recalled trying to answer a question from a client and finding little help in the existing rules.

“We started with a blank screen or blank piece of paper and started from scratch,” he said. “Our goal was to clarify the rules and make them easier to understand for both lawyers and non-lawyers.”

Quinn said he told the VSB ethics committee he thought the rules panel had come up with a good product.

“It’s not perfect, because it was written by a committee,” he added.

A national nonprofit that advocates against restrictions on new ways to provide legal services is expected to weigh in with comments.

“It’s a small step forward from having a vague, hard-to-enforce definition of the unauthorized practice of law,” said Tom Gordon, executive director of Consumers for a Responsive Legal System, known as “Responsive Law.”

Nevertheless, Gordon said, “it doesn’t do all it should to allow consumers the widest possible range of services while still protecting them from those who would do them harm.”

Gordon said it appeared the rules rewrite would clear the way for a company like LegalZoom, which sells legal forms generated from information consumers enter online. LegalZoom’s general counsel serves on the board of Responsive Law.

The proposed new rules would permit the sale of legal forms “provided no legal advice is provided to complete the forms.” Quinn said the committee did not discuss the rules’ potential application to LegalZoom at its meetings.

Gordon questioned the extensive and detailed language about activities of real estate agents and settlement agents. He said the proposed rules would even bar a settlement agent from explaining legal terms in a transaction.

Comments sought

The UPL rules rewrite is posted on the VSB website.

Comments may be submitted to [email protected] no later than July 13.

Members of the UPL rewrite committee are:

Adam D. Elfenbein, chair

Susan M. Butler

Tara L. Casey

Guy C. Crowgey

Judge Barbara J. Gaden

Christine Lockhart Poarch

Dennis J. Quinn