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Guidelines for the

Utilization of Paralegal Services

American Bar Association Standing Committee on Paralegals

ABA Model

ABA Model

Guidelines

for the

Utilization of Paralegal Services

____________________________________________________

American Bar Association

Standing Committee on Paralegals

Guidelines

Copyright ©2018 American Bar Association

All rights reserved. The American Bar Association grants permission for reproduction of this document, in whole or in part, provided that such use is for informational, non-commercial purposes only and any copy of the materials or portion thereof acknowledges original publication by the American Bar Association and includes the title of the publication, the name of the author, and the legend “Copyright 2018 American Bar Association. Reprinted by permission.” Requests to reproduce materials in any other manner should be addressed to: Copyrights & Contracts Department, American Bar Association, 321 North Clark Street, Chicago, Illinois 60654; Telephone (312) 988-6102; Facsimile: (312) 988-6030; E-mail: [email protected]

ISBN: 978-1-64105-321-1

The materials contained herein represent the opinions of the authors and editors and should not be construed to be those of the American Bar Association unless adopted pursuant to the bylaws of the Association. Nothing contained herein is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. These materials are intended for educational and informational purposes only.

Produced by the Standing Committee on Paralegals.

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ABA MODEL GUIDELINES FOR THE

UTILIZATION OF PARALEGAL SERVICES©

Preamble

The Standing Committee on Paralegals of the American Bar Association drafted,

and the ABA House of Delegates adopted, the ABA Model Guidelines for the Utilization of Legal Assistant Services in 1991. Most states have also prepared or adopted state‐specific recommendations or guidelines for the utilization of services provided by paralegals.1 All of these recommendations or guidelines are intended to provide lawyers with useful and authoritative guidance in working with paralegals.

The Standing Committee’s intent in updating the Model Guidelines is to include legal and policy developments that may have taken place since the last update in 2012. A Table of Contents and a Table of Authorities have been added, and the Commentary is now phrased in a “reader‐friendly” style. The Standing Committee is of the view that these and other guidelines on paralegal services will encourage lawyers to utilize those services effectively and promote the continued growth of the paralegal profession.2

The Standing Committee has based these 2018 revisions on the American Bar Association's Model Rules of Professional Conduct (hereinafter “Model Rule”) but has also attempted to take into account existing state recommendations and guidelines, decided authority and contemporary practice. Lawyers, of course, are to be first directed by Model Rule 5.3 in the utilization of paralegal services, and nothing contained in these Model

1 In 1986, the ABA Board of Governors approved a definition for the term “legal assistant.” In

1997, the ABA amended the definition of legal assistant by adopting the following language: “A legal assistant or paralegal is a person qualified by education, training or work experience who is employed or retained by a lawyer, law office, corporation, governmental agency or other entity who performs specifically delegated substantive legal work for which a lawyer is responsible.” To comport with current usage in the profession, these guidelines use the term “paralegal” rather than “legal assistant;” however, lawyers should be aware that the terms legal assistant and paralegals are often used interchangeably.

2 While necessarily mentioning paralegal conduct, lawyers are the intended audience of these

Guidelines. The Guidelines, therefore, are addressed to lawyer conduct and not directly to the conduct of the paralegal.

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Guidelines is intended to be inconsistent with that rule.3 Specific ethical considerations and case law in particular states must also be taken into account by each lawyer that reviews these guidelines. In the commentary after each Guideline, we have attempted to identify the basis for the Guideline and any issues of which we are aware that the Guideline may present. We have also included selected references to state and paralegal association guidelines where we believed it would be helpful to the reader. Model documents from two national paralegal associations are referenced throughout this publication. These documents are the National Federation of Paralegal Associations (NFPA), Model Code of Ethics and Professional Responsibility and Guidelines for Enforcement [hereinafter “NFPA Guidelines”];4 and the National Association of Legal Assistants (NALA), Code of Ethics and Professional Responsibility [hereinafter “NALA Ethics”].5 Rather than continually reference the web address for these documents throughout the publication, they are provided here:

National Association of Legal Assistants (NALA): www.nala.org (http://www.nala.org/code.aspx)

National Federation of Paralegal Associations (NFPA): www.paralegals.org (http://www.paralegals.org/associations/2270/files/modelcode.html

3 The ABA Commission on Ethics 20/20 amended several of the Model Rules referenced in

this publication, including Rules 1.1, 1.4, 1.6, 5.3, 5.4, 5.5, in 2012. The amendments to Model Rule 5.3 changed the words “nonlawyer assistants” to “nonlawyer assistance” in the title and amended the Comments to Model Rule 5.3. These changes are meant to highlight that lawyers have an obligation to make reasonable efforts to ensure that all nonlawyers that assist them act in a manner that is consistent with the attorney’s professional obligations – whether paralegals /assistants within the firm or others employed from outside the firm (outsourcing). The Committee does not believe these changes affect the way that Rule 5.3 is applied to paralegal practice.

4 The NFPA Model Code of Ethics and Professional Responsibility was initially adopted in

1993. The revision used in this publication was made on June 9, 2006. The current version is available on the NFPA web site indicated above.

5 The NALA Code of Ethics and Professional Responsibility was originally adopted 1975, and

revised 1979, 1988, 1995, and 2007. The 2007 version is used in this publication. The current version is available at the web site referenced above.

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Table of Contents

The Guidelines Guideline 1: ……………………………………………………………………………………………………………….. 4

A lawyer is responsible for all of the professional actions of a paralegal performing services at the lawyer’s direction and should take reasonable measures to ensure that the paralegal’s conduct is consistent with the lawyer’s obligations under the rules of professional conduct of the jurisdiction in which the lawyer practices.

Guideline 2: ………………………………………………………………………………………………………………. 5 Provided the lawyer maintains responsibility for the work product, a lawyer may delegate to a paralegal any task normally performed by the lawyer except those tasks proscribed to a nonlawyer by statute, court rule, administrative rule or regulation, controlling authority, the applicable rule of professional conduct of the jurisdiction in which the lawyer practices, or these Guidelines.

Guideline 3: ……………………………………………………………………………………………………………….. 9 A lawyer may not delegate to a paralegal:

(a) Responsibility for establishing an attorney‐client relationship. (b) Responsibility for establishing the amount of a fee to be charged for a

legal service. (c) Responsibility for a legal opinion rendered to a client.

Guideline 4: ……………………………………………………………………………………………………………… 10 A lawyer is responsible for taking reasonable measures to ensure that clients, courts, and other lawyers are aware that a paralegal, whose services are utilized by the lawyer in performing legal services, is not licensed to practice law.

Guideline 5: ……………………………………………………………………………………………………………… 11 A lawyer may identify paralegals by name and title on the lawyer’s letterhead and on business cards identifying the lawyer’s firm.

Guideline 6: ……………………………………………………………………………………………………………… 12 A lawyer is responsible for taking reasonable measures to ensure that all client confidences are preserved by a paralegal.

Guideline 7: ……………………………………………………………………………………………………………… 14 A lawyer should take reasonable measures to prevent conflicts of interest resulting from a paralegal’s other employment or interests.

Guideline 8: ……………………………………………………………………………………………………………… 17 A lawyer may include a charge for the work performed by a paralegal in setting a charge and/or billing for legal services.

Guideline 9: ……………………………………………………………………………………………………………… 18 A lawyer may not split legal fees with a paralegal nor pay a paralegal for the referral of legal business. A lawyer may compensate a paralegal based on the quantity and quality of the paralegal’s work and the value of that work to a law practice, but the paralegal’s compensation may not be contingent, by advance agreement, upon the outcome of a particular case or class of cases.

Guideline 10: ……………………………………………………………………………………………………………. 20 A lawyer who employs a paralegal should facilitate the paralegal’s participation in appropriate continuing education and pro bono publico activities.

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GUIDELINE 1: A lawyer is responsible for all of the professional actions of a paralegal performing services at the lawyer’s direction and should take reasonable measures to ensure that the paralegal's conduct is consistent with the lawyer's obligations under the rules of professional conduct of the jurisdiction in which the lawyer practices.

COMMENT

▪ Guideline 1 principles are incorporated within all guidelines.

The Standing Committee on Paralegals (“Standing Committee”) regards Guideline 1 as a comprehensive statement of general principle governing the utilization of paralegals in the practice of law. As such, the principles contained in Guideline 1 express the overarching principle that although a lawyer may delegate tasks to a paralegal, a lawyer must always assume ultimate responsibility for the delegated tasks and exercise independent professional judgment with respect to all aspects of the representation of the client.

▪ Application of the Model Rules and Ethical Considerations of the Model Code

Under principles of agency law and the rules of professional conduct, lawyers are responsible for the actions and the work product of nonlawyers they employ. Model Rule

5.36 requires that supervising lawyers ensure that the conduct of nonlawyer assistants7 is compatible with the lawyer’s professional obligations.

Ethical Consideration 3‐6 of the Model Code encourages lawyers to delegate tasks to paralegals so that legal services can be rendered more economically and efficiently. Ethical Consideration 3‐6 further provides, however, that such delegation is only proper if the lawyer “maintains a direct relationship with his client, supervises the delegated work, and has complete professional responsibility for the work product.” The adoption of Model Rule 5.3, which incorporates these principles, reaffirms this encouragement.

6 The Model Rules were first adopted by the ABA House of Delegates in August of 1983.

Almost all U.S. jurisdictions have adopted the Model Rules to govern the professional conduct of lawyers licensed in those states. However, because a few jurisdictions still utilize a version of the ABA Model Code of Professional Responsibility (“Model Code”), these comments will refer to both the Model Rules and the predecessor Model Code (and to the Ethical Considerations (hereinafter “EC”) and Disciplinary Rules (hereinafter “DR”) found under the canons in the Model Codes). In 1997, the ABA formed the Commission on Evaluation of the Rules of Professional Conduct (“Ethics 2000 Commission”) to undertake a comprehensive review and revision of the Model Rules. The ABA House of Delegates completed its review of the Commission’s recommended revisions in February 2002. Visit https://www.americanbar.org/groups/professional_responsibility/policy.html (last visited June 13, 2018) for information regarding the status of each state supreme court’s adoption of the Ethics 2000 revisions to the Model Rules as well as copies of both the model rules and model code.

7 See supra note 3 regarding a change to the terminology in Rule 5.3 effective in 2012.

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▪ Lawyers must instruct paralegals on professional conduct rules and supervise paralegals consistent with the rules.

To conform to Guideline 1, a lawyer must give appropriate instruction to paralegals supervised by the lawyer about the rules governing the lawyer’s professional conduct, and require paralegals to act in accordance with those rules. See Comment to Model Rule 5.3; see also National Association of Legal Assistant’s Model Standards and Guidelines for the Utilization of Legal Assistants, Guidelines 1 and 4 (1985, revised 1990, 1997, 2005) (hereafter “NALA Guidelines”).

Additionally, the lawyer must directly supervise paralegals employed by the lawyer to ensure that, in every circumstance, the paralegal is acting in a manner consistent with the lawyer’s ethical and professional obligations. What constitutes appropriate instruction and supervision will differ from one state to another and the lawyer has the obligation to make adjustments accordingly.

GUIDELINE 2: Provided the lawyer maintains responsibility for the work product, a lawyer may delegate to a paralegal any task normally performed by the lawyer except those tasks proscribed to a nonlawyer by statute, court rule, administrative rule or regulation, controlling authority, the applicable rule of professional conduct of the jurisdiction in which the lawyer practices, or these guidelines.

COMMENT

▪ Many tasks may be delegated to Paralegals so long as they are properly supervised.

The essence of the definition of the term “legal assistant” first adopted by the ABA in 19868 and subsequently amended in 19979 is that, so long as appropriate supervision is maintained, many tasks normally performed by lawyers may be delegated to paralegals. EC 3‐6 under the Model Code mentioned three specific kinds of tasks that paralegals may perform under appropriate lawyer supervision: factual investigation and research, legal research, and the preparation of legal documents. Various states delineate more specific tasks in their guidelines including attending client conferences, corresponding with and

8 The 1986 ABA definition read: “A legal assistant is a person, qualified through education,

training or work experience, who is employed or retained by a lawyer, law office, governmental agency, or other entity, in a capacity or function which involves the performance, under the ultimate direction and supervision of an attorney, of specifically‐delegated substantive legal work, which work, for the most part, requires a sufficient knowledge of legal concepts that, absent such assistant, the attorney would perform the task.”

9 In 1997, the ABA amended the definition of legal assistant by adopting the following

language: “A legal assistant or paralegal is a person qualified by education, training or work experience who is employed or retained by a lawyer, law office, corporation, governmental agency or other entity who performs specifically delegated substantive legal work for which a lawyer is responsible.”

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obtaining information from clients, witnessing the execution of documents, preparing transmittal letters, and maintaining estate/guardianship trust accounts. See, e.g., Colorado Bar Association Guidelines for the Utilization of Paralegals (the Colorado Bar Association adopted guidelines in 1986 for the use of paralegals in 21 specialty practice areas including bankruptcy, civil litigation, corporate law and estate planning. The Colorado Bar Association Guidelines were revised in 2008); NALA Guideline 5.

▪ Paralegals may not, however, engage in the unauthorized practice of law.

While appropriate delegation of tasks is encouraged and a broad array of tasks is properly delegable to paralegals, improper delegation of tasks will often run afoul of a lawyer’s obligations under applicable rules of professional conduct. A common consequence of the improper delegation of tasks is that the lawyer will have assisted the paralegal in the unauthorized “practice of law” in violation of Model Rule 5.5, Model Code DR 3‐101, and the professional rules of most states. Neither the Model Rules nor the Model Code defines the “practice of law.”10 EC 3‐5 under the Model Code gave some guidance by equating the practice of law to the application of the professional judgment of the lawyer in solving clients’ legal problems. This approach is consistent with that taken in ABA Opinion 316 (1967) which states: “A lawyer . . . may employ nonlawyers to do any task for him except counsel clients about law matters, engage directly in the practice of law, appear in court or appear in formal proceedings as part of the judicial process, so long as it is he who takes the work and vouches for it to the client and becomes responsible for it to the client.”

▪ Generally Paralegals may not appear before adjudicative bodies.

As a general matter, most state guidelines specify that paralegals may not appear before courts, administrative tribunals, or other adjudicatory bodies unless the procedural rules of the adjudicatory body authorize such appearances. See, e.g., State Bar of Arizona, Committee on the Rules of Prof'l Conduct, Opinion No. 99‐13 (December 1999) (attorney did not assist in unauthorized practice of law by supervising paralegal in tribal court where tribal court rules permit non‐attorneys to be licensed tribal advocates).11 Additionally, no state permits paralegals to conduct depositions or give legal advice to clients. E.g., Guideline 2, Connecticut Bar Association Guidelines for Lawyers Who Employ or Retain Legal Assistants (the “Connecticut Guidelines”); Guideline 2, State Bar of Michigan Guidelines for Utilization of Legal Assistants; State Bar of Georgia,

10 The ABA formed a task force in 2003 to examine the various state definitions of the

“practice of law.” The report of that task force, as well as related resources are available on the ABA

web site at the following URL:

https://www.americanbar.org/groups/professional_responsibility/task_force_model_definition_pra ctice_law.html (last visited on June 13, 2018).

11 It is important to note that pursuant to federal or state statute, paralegals are permitted to

provide direct client representation in certain administrative proceedings. While this does not obviate the lawyer’s responsibility for the paralegal’s work, it does change the nature of the lawyer’s supervision of the paralegal. The opportunity to use such paralegal services has particular benefits to legal services programs and does not violate Guideline 2. See generally ABA Standards for Providers of Civil Legal Services to the Poor Std. 6.3, at 6.17‐6.18 (1986).

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State Disciplinary Board Advisory Opinion No. 21 (September 16, 1977); Doe v. Condon, 532 S.E.2d 879 (S.C. 2000) (it is the unauthorized practice of law for a paralegal to conduct educational seminars and answer estate planning questions because the paralegal will be implicitly advising participants that they require estate planning services). See also NALA Guidelines II, III, and V.

▪ The “practice of law” is defined by the states.

Ultimately, apart from the obvious tasks that virtually all states agree are proscribed to paralegals, what constitutes the “practice of law” is governed by state law and is a fact specific question. See, e.g., Louisiana Rules of Prof'l Conduct Rule 5.5 which sets out specific tasks considered to be the “practice of law” by the Supreme Court of Louisiana. Thus, some tasks that have been specifically prohibited in some states are expressly delegable in others. Compare Guideline 2, Connecticut Guidelines (permitting paralegal to attend real estate closings even though no supervising lawyer is present provided that the paralegal does not render opinion or judgment about execution of documents, changes in adjustments or price or other matters involving documents or funds) and The Florida Bar, Opinion 89‐5 (November 1989) (permitting paralegal to handle real estate closing at which no supervising lawyer is present provided, among other things, that the paralegal will not give legal advice or make impromptu decisions that should be made by a lawyer) with Supreme Court of Georgia, Formal Advisory Opinion No. 86‐5 (May 1989) (closing of real estate transactions constitutes the practice of law and it is ethically improper for a lawyer to permit a paralegal to close the transaction). It is thus incumbent on the lawyer to determine whether a particular task is properly delegable in the jurisdiction at issue.

▪ The key to successfully complying with Guideline 2 is proper supervision.

Once the lawyer has determined that a particular task is delegable consistent with the professional rules, utilization guidelines, and case law of the relevant jurisdiction, the key to Guideline 2 is proper supervision. A lawyer should start the supervision process by ensuring that the paralegal has sufficient education, background and experience to handle the task being assigned. The lawyer should provide adequate instruction when assigning projects and should also monitor the progress of the project. Finally, it is the lawyer’s obligation to review the completed project to ensure that the work product is appropriate for the assigned task. See, e.g., Spencer v. Steinman, 179 F.R.D. 484 (E.D. Penn. 1998) (lawyer sanctioned under Rule 11 for paralegal’s failure to serve subpoena duces tecum on parties to the litigation because the lawyer “did not assure himself that [the paralegal] had adequate training nor did he adequately supervise her once he assigned her the task of issuing subpoenas”).

▪ Consequences of failure to properly delegate tasks to or to supervise a paralegal properly.

Serious consequences can result from a lawyer’s failure to properly delegate tasks to or to supervise a paralegal properly. For example, the Supreme Court of Virginia upheld a

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malpractice verdict against a lawyer based in part on negligent actions of a paralegal in performing tasks that evidently were properly delegable. Musselman v. Willoughby Corp., 230 Va. 337, 337 S.E. 2d 724 (1985); see also C. Wolfram, Modern Legal Ethics 236, 896 (1986). Disbarment and suspension from the practice of law have resulted from a lawyer’s failure to properly supervise the work performed by paralegals. See Matter of Disciplinary Action Against Nassif, 547 N.W.2d 541 (N.D. 1996) (disbarment for failure to supervise which resulted in the unauthorized practice of law by office paralegals); Attorney Grievance Comm’n of Maryland v. Hallmon, 681 A.2d 510 (Md. 1996) (90‐day suspension for, among other things, abdicating responsibility for a case to paralegal without supervising or reviewing the paralegal’s work). Lawyers have also been subject to monetary and other sanctions in federal and state courts for failing to properly utilize and supervise paralegals. See In re Hessinger & Associates, 192 B.R. 211 (N.D. Cal. 1996) (bankruptcy court directed to reevaluate its $100,000 sanction but district court finds that law firm violated Rule 3‐110(A) of the California Rules of Professional Conduct by permitting bankruptcy paralegals to undertake initial interviews, fill out forms and complete schedules without attorney supervision).

Finally, it is important to note that although the attorney has the primary obligation to not permit a nonlawyer to engage in the unauthorized practice of law, some states have concluded that a paralegal is not relieved from an independent obligation to refrain from illegal conduct and to work directly under an attorney’s supervision. See In re Opinion No. 24 of the Committee on the Unauthorized Practice of Law, 607 A.2d 962, 969 (N.J. 1992) (a “paralegal who recognizes that the attorney is not directly supervising his or her work or that such supervision is illusory because the attorney knows nothing about the field in which the paralegal is working must understand that he or she is engaged in the unauthorized practice of law”); Kentucky Supreme Court Rule (SCR) 3.700 (stating that “the paralegal does have an independent obligation to refrain from illegal conduct”). Additionally, paralegals must also familiarize themselves with the specific statutes governing the particular area of law with which they might come into contact while providing paralegal services. See, e.g., 11 U.S.C. § 110 (provisions governing nonlawyer preparers of bankruptcy petitions); In Re Moffett, 263 B.R. 805 (W.D. Ky. 2001) (nonlawyer bankruptcy petition preparer fined for advertising herself as “paralegal” because that is prohibited by 11 U.S.C. § 110(f). Again, the lawyer must remember that any independent obligation a paralegal might have under state law to refrain from the unauthorized practice of law does not in any way diminish or vitiate the lawyer’s obligation to properly delegate tasks and supervise the paralegal working for the lawyer.

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GUIDELINE 3: A lawyer may not delegate to a paralegal:

(a) Responsibility for establishing an attorney‐client relationship. (b) Responsibility for establishing the amount of a fee to be charged

for a legal service. (c) Responsibility for a legal opinion rendered to a client.

COMMENT

▪ The lawyer must establish and maintain a relationship with the client to ensure that the client can effectively participate in the representation.

Model Rule 1.4 and most state codes require lawyers to communicate directly with their clients and to provide their clients information reasonably necessary to make informed decisions and to effectively participate in the representation. While delegation of legal tasks to nonlawyers may benefit clients by enabling their lawyers to render legal services more economically and efficiently, Model Rule 1.4 and EC 3‐6 under the Model Code emphasize that delegation is proper only if the lawyer “maintains a direct relationship with his client, supervises the delegated work and has complete professional responsibility for the work product.” NALA Ethics Canon 2, echoes the Model Rule when it states: “A paralegal may perform any task which is properly delegated and supervised by an attorney, as long as the attorney is ultimately responsible to the client, maintains a direct relationship with the client, and assumes professional responsibility for the work product.” Most state guidelines also stress the paramount importance of a direct attorney‐client relationship. See New Mexico Rule 20‐106. The direct personal relationship between client and lawyer is critical to the exercise of the lawyer’s trained professional judgment.

▪ The lawyer must set fees, and discuss the basis for fees, directly with the client.

Fundamental to the lawyer‐client relationship is the lawyer’s agreement to undertake representation and the related fee arrangement. The Model Rules and most states require lawyer

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