Updated Rules of Professional Conduct: Expanding Our Duty to Report Another Lawyer for Misconduct?6/14/2016  On May 26, 2016, Convocation approved amendments to the Law Society of Upper Canada’s Rules of Professional Conduct, including amendments to the rule governing our duty to report another lawyer. I have previously written about this professional obligation on my blog here.
The recent amendments will hopefully bring some clarification to when our duty will arise, but may also expand that positive duty to encompass reporting behaviour or conduct that is far more prevalent than under the previous rule. The Amendments In October 2014 the Rules were amended to reflect the Federation of Law Societies of Canada’s (FLSC) Model Code. Rule 7.1-3 read as follows: Duty to Report Misconduct (October 2014) 7.1-3 A lawyer shall report to the Law Society, unless to do so would be unlawful or would involve a breach of solicitor-client privilege, (a) the misappropriation or misapplication of trust monies; (b) the abandonment of a law or legal services practice; (c) participation in serious criminal activity related to a licensee’s practice; (d) the mental instability of a licensee of such a serious nature that the licensee’s clients are likely to be materially prejudiced; and (e) [FLSC - not in use] (f) any other situation where a licensee’s clients are likely to be severely prejudiced. Convocation voted to change the wording of this rule to reflect amendments the FLSC recently made to the Model Code in March 2016. Section 7.1-3(e) will now read: Unless to do so would be unlawful or would involve a breach of solicitor-client privilege, a lawyer shall report to the Law Society conduct that raises a substantial question about the lawyer’s capacity to provide professional services. I had questioned in my previous post the earlier wording which required us to report another lawyer if the “mental instability” of that lawyer was of such a “serious nature” as to “materially prejudice” a client’s interest. I think the new amendment will provide some clarity by removing the words “mental instability” and including the more widely recognized term of “capacity”. If other lawyers are aware that a lawyer does not have the requisite capacity to provide professional services, or their conduct raises a substantial question as to their capacity, lawyers should be under a positive duty to report. The recent amendments also revised the wording of Rule 7.1-3 (d) which now states: Unless to do so would be unlawful or would involve a breach of solicitor-client privilege, a lawyer shall report to the Law Society conduct that raises a substantial question as to another lawyer’s honesty, trustworthiness, or competency as a lawyer. When the LSUC implemented the Model Code in October 2014, it chose not to use this subsection of the Rule. The most recent amendments have now added it. Arguably this addition broadens our duty to report another lawyer for misconduct. Previously, besides situations of ‘mental instability’, we were only under a positive obligation to report misappropriation of trust funds, an abandoned practice, criminal activity and the catch-all situation where a client was likely to be severely prejudiced – occurrences that are rather rare. But how many times have you seriously questioned the honesty, trustworthiness, or competency of another lawyer? Unfortunately, if you are anything like me, it’s been a few times during my career. With this new sub-rule we may not have any choice but to report these lawyers. Am I saying you should report a fellow lawyer for not being completely truthful about how many trials they’ve won? No, not likely. But I think, as with all of the rules, one should look at the circumstances as a whole, use your judgement, and remind yourself of the high standards of the legal profession. While reporting a fellow lawyer may result in serious ramifications for that lawyer (and potentially for the reporting lawyer), not reporting could result in even more serious consequences for that lawyer’s clients if the conduct prejudices their case and legal rights. Burying our heads in the sand and ignoring the misconduct of a fellow lawyer (including their lack of honesty, trustworthiness and competency) could result in worse implications for that lawyer, the public, and the profession as a whole. Other Amendments Understandably, some law societies and legal ethics academics expressed concerns about the language that described “mental instability” as “misconduct”. With that, the amendments remove the word “misconduct” from the title of the rule. Amendments were also made to the commentary associated with sub-rule 7.1-3, including clarifying that when you report anther lawyer it must be “made without malice or ulterior motive”. The commentary also now uses language that is less discriminatory for describing when we should be encouraging other lawyers to seek professional help: i.e. removing “lawyers who suffer from such problems” to “lawyers who face such challenges”. Other rules that were amended include Rule 3.4-27 (Transactions with Clients), Rule 3.2-1 (Quality of Service) and Rules 7.8-1 &7.8-2 (Errors and omissions). The full report on the amendments can be found here.
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Lawyers still need to pay their bills, and as far as I know the banks are not accepting homemade cookies as mortgage payments. Bartering only works if we can find someone who needs our services and who is offering goods or services for which we have a need. However, if we were open to alternative payment options, we may be able to provide legal services to clients who cannot afford legal representation. This is especially true for those practicing in areas with a high number of self-represented litigants such as family law.
Is Bartering Allowed by the LSUC? Nothing in the Rules of Professional Conduct, or the by-laws specifically addresses bartering arrangements. Nevertheless, a lawyer contemplating bartering her legal services should carefully review the Rules and by-Laws to make sure her barter arrangement is in compliance. For example, Rule 3.6-1 provides that a “lawyer shall not charge or accept any amount for a fee or disbursement unless it is fair and reasonable and has been disclosed in a timely fashion.” The goods or services you are receiving must be commensurate with the services you provide. Furthermore, all record-keeping responsibilities should be met and the work should be properly invoiced. The only clear guidance that I could find from the LSUC, was in a decision by the Law Society Tribunal which confirmed the obvious: “Legal services are not to be bartered for sexual favours.” Barter-Exchange Programs Bartering in general has become more sophisticated and moved past the chicken and egg days with numerous “barter-exchange programs” throughout Canada and the United States. A barter exchange acts as a clearinghouse for the exchange of goods and services and keeps track of the value of the barter transactions between members. Members often have to pay dues or fees to join. (For example see, eXmerce, Barter Network Limited and Swap Right). There is little guidance on lawyers using barter exchange networks in Canada. I found a Tax Court of Canada case[1] from 1985 where a lawyer bartered his legal services on a barter exchange network called Tradex. The lawyer would obtain ‘exchange credits’ from other members for his legal services and he would exchange these credits for other services (i.e. dental services for himself and his family). The issue for the Court was the value of those exchange credits for income tax purposes. (Yes, any service or good you receive in payment is considered income and must be reported. See the CRA bulletin on “Barter Transactions”). Not surprisingly, I found more resources for lawyers on bartering exchange programs south of the border. Recently, the Connecticut Bar Association’s Standing Committee on Professional Ethics released an informal opinion on a lawyer’s participation in such a program. The report noted that early ethics opinions from state bar associations and the American Bar Association in the late 1970s were “undeniably hostile” to barter exchanges and the fees charged to their members. However, recent opinions have been more amenable. The Connecticut Bar Association concluded that participation in such an exchange was not unethical, but lawyers must still comply with the relevant rules of professional conduct, including those dealing with confidentiality, client solicitation and advertising. Importantly, the “cardinal principle” still applies: “the fee must not be unreasonable, regardless of the form of payment”.[2] It did not see the fee paid to the barter exchange program to be fee sharing (which is prohibited with a non-lawyer) but confirmed that there should be a written engagement agreement, including that barter currency will be used as the compensation for legal services. To Barter or Not To Barter: If you are considering bartering your legal services (either as a one-off arrangement or through a barter exchange program), be prepared and:
[1] Linett and Karoly v The Minister of National Revenue, 85 DTC 416. [2] Connecticut Bar Association, Standing Committee on Professional Ethics, Informal Opinion 15-04 “Lawyer’s Participation in a Barter-Exchange Program” July 2015 at p. 2 Note: Content from this blog does not constitute legal advice and is for informational purposes only.  Once again the LSUC is asking its members for input, this time about the possible implementation of “compliance-based entity regulation”. So, what is it? Why should you care? And how will it affect you?
According to a consultation paper prepared by the related LSUC Task Force, “compliance-based entity regulation” refers to “the proactive regulation of the practice entity through which legal services are delivered”. From what I gather, in the most basic terms, this means that the LSUC wants to start regulating firms (in addition to individual lawyers) in order to help prevent lawyers from messing up, instead of just dealing with lawyers after they have messed up. Makes sense to me. But what will law firms (or “entities”) be required to do? Clearly, the LSUC will need to find the proper balance between regulating the individual lawyer and the legal entity. Practice Management System / Ethical Infrastructure Entities would be required to implement certain “practice management principles” through a “practice management system” or an “ethical infrastructure”. What does that mean? Basically, firms are going to have to put in place policies and procedures to help their lawyers behave. The Task Force is considering the following "principles":
Proof of Compliance? The law firms would have to demonstrate to the LSUC that they have implemented the above principles in their practice. However, they would have flexibility and autonomy in the implementation process. For example, a firm would have to show that it has a policy or procedure in place to deal with conflicts of interest, but the LSUC would not dictate what that policy would be. It does not appear that the burden on the entities (which will likely include solo and small firms) is too onerous. I would suspect that firms already have most of these policies in place. On February 8th the LSUC broadcast a webinar on this topic from 5-7pm, but I was only able to catch the first 30 mins (it wasn’t the most convenient time as it was right smack in the middle of kids’ homework, bath, and bedtime, etc., but I digress). The speakers that I managed to hear were quite clear that the approach was not going to be “one size fits all” and that a version of the compliance-based entity regulation that might apply to sole-practitioners and small firms would likely be different from the approach for medium to large firms. [Update: The webinar is now on youtube.] Other questions in the consultation paper include to which entities this new regulation should apply; whether entities should be registered with the LSUC; and whether there needs to be a designated practitioner at the entity that would have certain regulatory responsibilities.The paper also summarizes the positive impact of proactive regulation in other jurisdictions such as Australia and England and Wales. If you feel strongly about this topic, either for or against, or simply want to comment on it, I suggest you review the paper and questions and provide your input by the deadline of March 31, 2016. The full consultation paper can be found here. The Law Society of Upper Canada is proposing certain amendments to the Rules of Professional Conduct and is seeking input from the profession by October 16, 2015. The amendments cover a variety of topics, including conflicts of interest, doing business with a client, incriminating physical evidence, advertising, and short term legal services (pro bono context mainly).
I found the most interesting proposed changes were to the rules on advertising. The Call for Input Document states that since the last amendments to these advertising rules "there appears to have been a significant increase in the incidence and scope of lawyer advertising and regulatory concerns have prompted a review of these Rules." Have we gone too far with our tv commercials and bus ads? The new Rules would set out certain marketing practices that would contravene the Rules (which in the current Rules are only in the Commentary as practices that may contravene), including: advertising that suggests or implies that the lawyer is aggressive; referring to awards or endorsements without providing relevant information (including the source of the award, the nomination process and if any fees were paid by the lawyer (directly or indirectly)); as well as using testimonials which contain emotional appeals (how would you define emotional appeal?). The new Commentary to the Rule would provide examples of marketing practices that may contravene the Rules including: failing to disclose that the legal work is routinely referred to other lawyers for a fee rather than being performed by the lawyer; advertising awards and endorsements from third parties without disclaimers or qualifications; and misleading the public on the size of the lawyer's practice (so, no more saying "our lawyers" or "we" when you are a sole practitioner?) The full Call for Input Document can be found here. Identity Revealed: Lawyers Who Ghostwrite for Self-Represented Litigants, No Longer Ghosts?7/22/2015 In a growing number of jurisdictions lawyers may choose or agree to take on part, but not all, of a client’s legal matter with the client’s consent. These agreements are often called ‘limited scope retainers’ or the provision of ‘unbundled legal services’. In Ontario, the Law Society of Upper Canada amended the Rules of Professional Conduct in 2011 to explicitly allow lawyers to enter into limited scope retainers and clarified the requirements when doing so, such as having the retainer in writing and signed by the client. Limited scope retainers can cover a wide variety of situations, including when lawyers ‘ghostwrite’ pleadings (or a factum or motion material, etc.) for a self-represented litigant, but do not appear in court on their behalf or become solicitor of record.[1]
There are many reasons why the LSUC would allow such retainers, including providing an affordable option for litigants who cannot pay for full legal representation and encouraging lawyers to take on manageable and limited pro bono assignments. However, some have questioned whether such unbundled services are ethical, especially in the context of ‘ghostwritten’ pleadings. These critics argue that the judges or opposing counsel may be misled by the material presented, or the clients may not understand what was written by the lawyer or their legal position. Also, some argue that these purportedly unrepresented litigants may take advantage of the courts’ tendency to overlook defects in unrepresented court filings. The main concern, however, seems to be that if a lawyer’s identity and involvement are not revealed they may not be held accountable for potential violations of the Rules of Professional Conduct or for solicitor negligence.[2] Last month, the top court in Rhode Island examined ghostwriting pleadings for “pro se” or self-represented litigants after three lawyers had been sanctioned by a lower court for this practice.[3] In FIA Card Services, N.A. v. Pichette, No. 2012-272-Appeal (R.I.2015) the Rhode Island Supreme Court concluded that a lawyer may not ‘ghostwrite’ or otherwise assist a self-represented litigant with the preparation of pleadings, motions, or other written submissions unless the lawyer signs the document and discloses his or her identity and the extent of his or her assistance. However, the lawyer may also indicate that they are not the attorney of record. After reading this case I wondered, are lawyers in Ontario who ghostwrite for self-represented litigants required to sign a factum they drafted and reveal their identity and extent of involvement? I’m not sure. No Ontario court seems to have commented on this specific unbundled legal service and the Rules of Professional Conduct are silent on the requirement of a ghostwriting lawyer to reveal his or her identity and involvement. The Rules of Civil Procedure do allow a lawyer to enter into a limited scope retainer and not become a solicitor of record.[4] Also the Rules of Civil Procedure state that a party represented by a lawyer under a limited scope retainer is considered to be acting in person (unless the limited scope retainer includes the lawyer acting as solicitor of record). However, the Rules also require the party’s “lawyer” to sign any factum that is filed. So, if you are a drafting lawyer but not the solicitor of record do you still have to sign the factum? Also, is a self-represented litigant required to reveal to the court and opposing party that they are being assisted by a lawyer in a limited way? Or, can they keep this information to themselves should they choose? In its decision the RI Supreme Court stated that until they are persuaded otherwise, full disclosure of a lawyer’s involvement is the better practice. A lawyer who prepares such documents must still be held to the same standards as a solicitor of record. However, the Court also asked for comments from members of the bench, bar, and public on the subject of limited scope representation in general and the practice of ghostwriting in particular. What was concerning in the Rhode Island case was that the self-represented litigants did not understand their legal positions or the material that had been drafted by the ghostwriting lawyers. They also thought that the drafting lawyers were their retained attorneys of record. This suggests that the lawyers did not do a good job of explaining their limited scope retainer or the legal work that they provided. Are you a lawyer who ‘ghostwrites’ pleadings for self-represented litigants? Do you sign any facta you draft and disclose your identity and extent of your involvement? If not, should you? [1]Please note that I do not ghostwrite pleadings for self-represented litigants. I only assist other lawyers. While some may see this as a distinction without a difference, I do believe they are separate types of services with separate considerations. [2] For more on “Unbundled Legal Services” or “Limited Scope Retainers” in general in Ontario, see the following: LSUC , CBA , and LawPro . [3] This topic has been examined extensively in the United States by various bar associations and courts. See the ABA website on Ethics and Opinions regarding Limited Scope Retainers, setting out opinions from each State. [4] See Rule 15.01(4). As a Lawyer, When Would You (or Should You) Report another Lawyer for Professional Misconduct?11/24/2014 {Please note that the Rule discussed in this blog has been amended. My blog post on the amendments can be found here}
In my career I have been fortunate to work and interact with lawyers who are courteous, friendly, intelligent, civil, and formidable opponents. Most lawyers will promptly return my phone calls or emails, consent to requests for adjournments or extensions for filing defences (when appropriate), and use polite language, even in the most heated of arguments. I have only dealt with a handful of “unprofessional” lawyers. Some lawyers simply refuse to respond to emails, letters, or phone calls. Others think that profanity, derogatory remarks, or excessive yelling helps their argument. Once, when a judge asked opposing counsel why he had not responded to my multiple requests for document disclosure he answered, “Well, I don’t know, I guess sometimes I am just a real bum-hole.” He did not use the word bum. When I witness this behaviour I may complain to a colleague or my husband and think: “Someone ought to report this person to the Law Society”. Then I move on to the next client or the next file and forget about these lawyers and their questionable behaviour. However, when the newly amended Rules of Professional Conduct (the “Rules”) became effective on October 1, 2014, I reread them in their entirety and was reminded of my mandatory duty to report misconduct. This made me think: Am I under a duty to report this type of uncivil or unprofessional behaviour to the Law Society of Upper Canada (“LSUC”)? Rule 7.1-3 The new Rules are based on the Federation of Law Societies of Canada’s (“FLSC”) Model Code of Conduct. Rule 7.1-3 (which was old rule 6.01(3)) states: A lawyer shall report to the Law Society, unless to do so would be unlawful or would involve a breach of solicitor-client privilege, a) the misappropriation or misapplication of trust monies; b) the abandonment of a law or legal services practice; c) participating in serious criminal activity related to a licensee's practice; d) the mental instability of a licensee of such a serious nature that the licensee's clients are likely to be materially prejudiced; e) [FLSC not in use] f) any other situation where a licensee's clients are likely to be severely prejudiced [emphasis added] Interestingly, the LSUC chose not to implement section (e) of the FLSC’s Model Code which states: “conduct that raises a substantial question as to another lawyer’s honesty, trustworthiness, or competency as a lawyer”. Perhaps the LSUC chose not to adopt this section as the wording is very broad and could open the floodgates for potential reports of misconduct. So, what situations will give rise to a duty to report? The first three scenarios under Rule 7.1-3 seem straightforward and fairly easy to identify. If you are aware of a lawyer who has stolen trust funds, abandoned his or her law practice, or participated in serious criminal activity related to his or her law practice, it is clear that you have a duty to report such behaviour to the LSUC. However, the scenarios in subsections (d) and (f) raise some questions. Am I qualified to determine whether a fellow lawyer is mentally unstable? Or, am I able to determine if any such mental instability will “materially prejudice” a client? Also, what type of behaviour would fall into the ‘catch-all’ provision of “any other situation” where a client is “likely to be severely prejudiced”? What is my duty? Curious about my duty to report, I called the Practice Management Helpline at the LSUC. When I introduced myself as a lawyer writing on this topic I was asked for my LSUC number and advised that the LSUC would not respond to questions about hypothetical situations. So I used real examples from the past and asked for guidance on section (f): my duty to report “any other situation” where a lawyer’s clients “are likely to be severely prejudiced”. The individual I spoke with would not/could not provide me with a clear answer on the examples I provided. Nonetheless, she did parse the sentence for me and suggested that the use of the words “likely to be severely prejudiced” means that the Rule only applies to future client prejudice and not prejudice that has already occurred. In other words, if I am in a situation where I know a lawyer’s client is going to be severely prejudiced due to the lawyer’s actions I must step in and report the conduct to the LSUC, but if the client has already been severely prejudiced then I have no duty to report. This does not make sense to me and I question this interpretation of the Rule. When I asked if there were any guidelines to help me understand my duty to report I was told that there was only the Commentary to Rule 7.1-3 which states, in part: Unless a licensee who departs from proper professional conduct is checked at an early stage, loss or damage to clients or others may ensue. Evidence of minor breaches may, on investigation, disclose a more serious situation or may indicate the commencement of a course of conduct that may lead to serious breaches in the future. It is, therefore, proper (unless it is privileged or otherwise unlawful) for a lawyer to report to the Law Society any instance involving a breach of these rules or the rules governing paralegals. If a lawyer is in any doubt whether a report should be made, the lawyer should consider seeking the advice of the Law Society directly or indirectly (e.g. through another lawyer).[emphasis added] Contrary to the actual Rule, which according to the Practice Management Help Line seems to promote a very narrow interpretation of when there is a duty to report misconduct, the Commentary suggests a much broader duty, or at least an opportunity, for a lawyer to report any breach of the Rules as a whole. In other words, if I am aware of a lawyer who breaches her duty to conduct herself honestly and with integrity, civility, courtesy and good faith,[1] it would be appropriate for me to report such conduct. But, if I am also aware that this conduct will likely severely prejudice that lawyer’s clients, it is not only appropriate for me to report such conduct, I am obligated to do so. I could not find any LSUC disciplinary decisions that dealt directly with the “Duty to Report Misconduct” Rule 7.1-3 (or its predecessor 6.01(3)), or guidance for the thresholds of “materially” or “severely” prejudiced in this context. However, The Law Society of Upper Canada v. Groia [2] provides some guidance on ‘incivility’ in the profession and examples of the type of behaviour that will amount to professional misconduct in courtroom proceedings: “In this case, the conduct which is alleged to have ‘crossed the line’ is not mere rudeness, let alone bad manners. Nor is it simply excess rhetoric or sarcastic remarks about opposing counsel.”[3] “Nevertheless, taken as a whole, many of the comments he made crossed the line: they included repeated personal attacks on the integrity of the prosecutors and repeated allegations of deliberate prosecutorial wrongdoing that did not have a reasonable basis and were not otherwise justified by the context.”[4] “In our view, determining when uncivil courtroom communication ‘crosses the line’ is, therefore, fundamentally contextual and fact-specific.”[5] “In assessing the context of courtroom communications, it will be important to consider the dynamics, complexity and particular burdens and stakes of the trial . . . a few ill- chosen words or sarcastic or even nasty comments directed at one’s opponent may not constitute professional misconduct justifying a discipline proceeding, particularly if they reflect a moment of ill-temper and an apology is made. . .”[6] “In our view, it is professional misconduct to make allegations of prosecutorial misconduct or that impugn the integrity of opposing counsel unless they are both made in good faith and have a reasonable basis. A bona fide belief is insufficient; it gives too much licence to irresponsible counsel with sincere but nevertheless unsupportable suspicions of opposing counsel.”[7] Therefore, while the determination of professional misconduct is very fact and context specific, it must be more than ill-chosen words or sarcastic and nasty comments. Nevertheless, repeated personal attacks on the integrity of other lawyers, and deliberate allegations of prosecutorial wrongdoing were enough in the context of this case to make a finding of professional misconduct. Will You Report? Reporting a fellow lawyer for breaching the Rules may result in serious ramifications for that lawyer. However, not reporting misconduct could result in even more serious consequences for that lawyer’s clients if the conduct prejudices their case and legal rights. If the potential misconduct you witness is a result of a colleague or friend struggling with mental or emotional trouble, or drug or alcohol abuse, approaching that individual may be the best first step. You can remind them about the confidential counselling service provided by the LSUC and run by Homewood Human Solutions. While most lawyers would be hesitant to report another lawyer, we must remember that we may not have a choice. The best suggestion to deal with any hesitancy is perhaps to call the Law Society’s Practice Management helpline and hopefully they can provide you with some guidance on your specific situation. However, burying our heads in the sand and simply ignoring the misconduct of a fellow lawyer could result in worse implications for that lawyer, the public, and the profession as a whole. Please note that posts on this blog do not constitute legal advice and are for informational purposes only. [1] See Rules 2.1-1 and 5.1-5. [2] 2013 ONLSAP 41 (“Groia”), under appeal. [3] Groia at para. 8. [4] Groia at para. 10. [5] Groia at para. 232. [6] Groia at para. 233. [7] Groia at para. 235. |
 
  Erin C. Cowling is a former freelance lawyer, entrepreneur, business and career consultant, speaker, writer and CEO and Founder of Flex Legal Network Inc., a network of freelance lawyers.
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