Multidisciplinary practice groups: the time is now

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Edward Poll, BridgeTower Media Newswire

In the opening salvo in the early 1950s anti-Communist hearings, Sen. Joseph McCarthy dramatically asked, in a very brusque voice, “Are you now or have you ever been a member of the Communist Party?”
A similar refrain, with almost the same pejorative connotation, is asked today of many lawyers: “Are you now or have you ever been a proponent of multidisciplinary practice groups?”

MDPs are groups consisting of lawyers and non-lawyers jointly providing legal services. The concept has been hotly debated, with the American Bar Association weighing in with a final “no” in 2000. However, it is time to rethink MDPs.

Lawyers traditionally were well-versed in many disciplines. They had to know many things about many subjects in order to advise their clients well.

But in today’s world of specialization, this well-roundedness has become rare. General practitioners must now gather around themselves people of many skills in order to effectively represent clients.

At the same time, our rules of professional conduct forbid lawyers to “share fees” with non-lawyers. In fact, many jurisdictions prohibit the sharing of legal fees with anyone, even with other lawyers, unless the proration is based on actual work performance for the benefit of the client.

However, working with accountants, financial advisers, consultants and other non-lawyer professionals is exactly what attorneys already do for many clients — just not via a fee-sharing arrangement.

Trust and estate lawyers already use accountants and financial planners. Family law practitioners use accountants and psychologists. Elder law attorneys use financial planners, medical care providers, geriatric counselors and others.

Many solo and small-firm practitioners regularly delegate tasks to such non-lawyer professionals in order to better divide work according to each person’s special area of expertise. So what is so sacrosanct about dividing fees?

One of the main reasons for prohibiting the MDP concept is that the client’s confidences could be violated. While that privilege is an important distinction and differentiation of the role of the lawyer as compared to others, the privilege can be retained if the attorney is the head of the team, since all of the lawyer’s employees, staff and agents fall within the privilege.

Furthermore, the privilege has been eroded in a number of important areas anyway, so much so that one might legitimately wonder whether the privilege still exists. For example, confidentiality is no longer as important or even applicable in the following areas:

Internal Revenue Code Section 1099 and its regulations require a lawyer to issue Form-1099 to his clients when he collects money on their behalf. The fact that the money goes into the lawyer’s clients’ trust account does not alleviate this requirement. Sending the form to the IRS discloses the identity of the client.
So much for the attorney-client privilege.

Lawyers who suspect that a client will commit a “serious” crime in the future are obligated to warn the authorities in advance of the commission of the crime. Client confidentiality in that case also no longer exists.

A lawyer who represents a client against another lawyer can no longer make a settlement on the basis that the alleged negligence of the first lawyer will not be disclosed. Thus, the ability to keep the client’s confidence about the facts that allegedly occurred in an earlier matter has now evaporated.

In some cases, lawyers who advise clients about their options for asset protection are subject to prosecution. Confidences learned from clients in the process of such advice are no longer fully protected, and the process of giving advice about the methodology of protecting assets from creditors is, itself, subject to prosecution for conspiracy to commit a crime.

Ultimately, what matters in any discussion of the appropriateness of MDP is how the clients’ needs are best served. The rules of professional conduct must allow lawyers to do this in the most effective way possible.

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Edward Poll is the principal of LawBiz Management. He coaches lawyers and is the creator of “Life After Law,” a program that helps attorneys plan for profitable exits. He can be contacted at edpoll@lawbiz.com.

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