Wednesday, August 31, 2016
The Minnesota Supreme Court has admonished an unnamed Colorado attorney for unauthorized practice of law
We hold that engaging in e-mail communications with people in Minnesota may constitute the unauthorized practice of law in Minnesota, in violation of Minn. R. Prof. Conduct 5.5(a), even if the lawyer is not physically present in Minnesota. The Panel’s finding that appellant engaged in the unauthorized practice of law in Minnesota, in violation of Minn. R. Prof. Conduct 5.5(a), was not clearly erroneous. Appellant represented a Minnesota couple with respect to a Minnesota judgment and attempted to negotiate, via e-mail, the satisfaction of that judgment with a Minnesota lawyer, and was not authorized to practice law in Minnesota temporarily. We further conclude that the appropriate disposition for this misconduct is an admonition.
The representation was a family affair
Appellant is an attorney licensed to practice law in the state of Colorado, where he maintains an office and has been practicing environmental law since 1986. He has also practiced personal injury law for approximately 7 years. Part of his litigation practice includes debt collection. Appellant is admitted to practice law in New York, Florida, and Alaska, but is currently on inactive status in those states. Appellant is also admitted to practice in federal court in the District of Colorado, the District of Alaska, the Southern and Western Districts of New York, and the United States Court of Appeals for the Ninth and Tenth Circuits. Appellant is not licensed to practice law in Minnesota.
Appellant’s mother- and father-in-law live in Minnesota. They contacted appellant in May 2014 to obtain assistance regarding a judgment entered against them in conciliation court in Minnesota for $2,368.13 in favor of their condominium association, Voyager Condominium Homeowners’ Association, Inc. (VCHA). The couple told appellant that VCHA’s attorney, D.R., a Minnesota-based lawyer and the complainant in this case, was harassing them with telephone calls attempting to collect on the judgment. The couple asked appellant for his assistance in negotiating with D.R. regarding payment of the outstanding judgment
Appellant sent an e-mail to D.R. in late May 2014, informing D.R. that he was representing his in-laws and instructing D.R. to direct all future communications to him instead. Appellant and D.R. exchanged approximately two dozen e-mails between May 2014 and September 2014. In his first responsive e-mail to appellant, D.R. asked whether appellant was licensed to practice law in Minnesota. Appellant replied that he was not licensed in Minnesota and that if he needed to file suit in Minnesota he would hire local counsel. The subsequent e-mails consisted of discussions regarding the in-laws’ assets and ability to pay and whether the VCHA judgment would have priority in a foreclosure sale. Appellant attached financial disclosure forms to one of his e-mails and made a settlement offer.
In the penultimate e-mail exchange between the two attorneys, D.R. asserted that appellant was engaging in the unauthorized practice of law because he was not licensed in Minnesota. The final e-mail prior to D.R. filing an ethics complaint was a settlement proposal from appellant to D.R. on that same day. The Director received D.R.’s ethics complaint in October 2014. Approximately 2 months after filing the complaint, D.R. sent additional e-mails to appellant to determine whether the settlement offer was still available and whether appellant still represented his in-laws. Appellant did not respond to the subsequent e-mails and had no further involvement in the case.
The court found no exception to the rules governing practice by out-of-state attorneys
Under Minnesota Rules of Professional Conduct 5.5(c)(2), a lawyer admitted in another jurisdiction may provide legal services in Minnesota on a temporary basis if the lawyer’s services are reasonably related to a pending or potential proceeding before a tribunal and the lawyer reasonably expects to be authorized by law to appear in the proceeding. Comment 10 explains that a lawyer rendering services in Minnesota on a temporary basis is permitted to engage in conduct in anticipation of a proceeding or hearing in which the lawyer reasonably expects to be admitted pro hac vice. Minn. R. Prof. Conduct 5.5(c)(2) cmt. 10...
Moreover, appellant’s representation of his in-laws did not "arise out of" or "reasonably relate" to his practice in Colorado simply because his in-laws contacted him in Colorado or appellant has done collections work in Colorado. As the Director notes, appellant’s in-laws were not long-standing clients; nor was there any connection between the in-laws’ case and the state or laws of Colorado. And while appellant’s Colorado practice may involve judgment collections work, nothing in the record establishes that this work was based on a body of federal or nationally uniform law. To the contrary, appellant’s clients were Minnesota residents with a debt that arose in Minnesota that they owed to a Minnesota resident and that was governed by Minnesota law. Accordingly, Rule 5.5(c)(4) does not apply to appellant’s conduct.
The nature of the misconduct in this case is non-serious. Appellant wrongly believed that he could negotiate a settlement in Minnesota without being licensed to practice law in the state. The cumulative weight of the misconduct is also minimal. Appellant engaged in a series of e-mail communications with one attorney in a single matter involving appellant’s family members. In addition, the only harm appellant’s clients suffered was a delay in the resolution of their debt because of appellant’s actions. Accordingly, a private admonition is the appropriate discipline for appellant
Justice Anderson dissented joined by Justices Lillehaug and Chutich
Based on this record, I would conclude that appellant’s assistance with a small judgment-collection negotiation for his parents-in-law, including the emails to D.R., were "reasonably related" to appellant’s practice in Colorado, which satisfies Rule 5.5(c)(4). The "reasonably related" exception in Rule 5.5(c)(4) is a broad, catch-all exception that is intended to exempt circumstances such as those presented here. Moreover, the familial connection between appellant and his in-laws, and the fact that they contacted appellant in Colorado for assistance, should be an additional consideration that supports a finding that the matter was "reasonably related" to his practice in Colorado under Rule 5.5(c)(4)...
...as a policy matter, the implications of the court’s decision are troubling and counterproductive. The ABA Model Rule 5.5(c), as adopted by our state, was intended as a broad catch-all that “represent[s] a bold step towards new latitude in [a] multijurisdictional practice of law,” which accommodates the increasingly mobile and electronic nature of modern, national legal practice. See Rotunda & Dzienkowski, supra, at 1100-01, 1112. Today’s decision represents a step backwards. By the court’s reasoning, when family members or friends—an abundant source of clients—email or call a practitioner admitted in another state, seeking assistance in areas in which the practitioner is experienced and competent, relying on a relationship of trust and confidence, they must be turned away. Those potential clients must then expend unnecessary time and resources to research and hire local counsel—even for minor, temporary services in which the out of-state lawyer could have provided efficient, inexpensive, and competent service. Simply put, the court’s decision is contrary to the principles and policy goals intended by Rule 5.5(c).
In sum, this case involves clients contacting an attorney, their son-in-law, in his home state of Colorado, to request his assistance regarding a small collection matter—an area that reasonably relates to appellant’s expertise and experience in his Colorado litigation practice. Based on the relationship and contacts between the clients, appellant, and appellant’s practice of law in Colorado, there is a sufficient "reasonable relationship" here to satisfy the broad, catch-all exception under Rule 5.5(c)(4). For the above reasons, I conclude that appellant did not engage in professional misconduct because the exception in Rule 5.5(c)(4) applies.
Merits aside, was this worth the effort?
My answer: no.
The fact that (i) the attorney was assisting a family member and (ii) was entirely truthful about his bar status counsels against prosecution and (as the dissenters suggest) illuminates the public-unfriendly potential for abuse of the rules governing unauthorized practice. (Mike Frisch)