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Commonwealth of Massachusetts


October 2000

"THE OF COUNSEL RELATIONSHIP"

by
Nancy Kaufman

"Of counsel" originally described a semi-retired or retired partner who still kept a hand in the firm. Today, the designation "of counsel" is used to describe everything from a full-time outside lawyer providing expertise in a particular specialty to a firm to the guy down the hall who is available to discuss cases over coffee.

The definition of "of counsel" was first essayed by the American Bar Association in Formal Op. 330, issued in 1972. Formal Op. 330 advised that a lawyer was "of counsel" to a firm only when the relationship between the lawyer and the firm was "close, continuing, and personal" and when the relationship was not "that of a partner, associate, or outside counsel". MBA Op. 82-10 echoed this view, opining that a lawyer or firm could be properly identified as of counsel to another lawyer or law firm only if there were "continuous and regular dealings that involve the rendering of legal advice by one to the other."

According to ABA Formal Op. 330 and successive informal opinions, a lawyer who was of counsel to a firm should have nearly daily contact with the firm, a law firm could not be of counsel to another law firm, and no lawyer could likely be of counsel to more than two firms. These and other restrictions proved too onerous and not in conformity with accepted practice in the profession. As a consequence, the ABA revisited the definition of "of counsel" in 1990 in Formal Op. 90-357. Among other things, the requirement that contact be nearly on a daily basis, the advice that a law firm could not be "of counsel", and the restrictions on the number of "of counsel" relationships that could simultaneously be maintained were rejected.

Nevertheless, Formal Op. 90-357 reaffirmed that the "core characteristic" of "of counsel" was "'a close, regular, personal relationship'" but excluding "that of a partner (or its equivalent, a principal of a professional corporation), with the shared liability and/or managerial responsibility implied by that term," and associates, defined as "a junior non-partner lawyer, regularly employed by the firm." Lawyers identified as "tax counsel" or "antitrust counsel" and the like are understood to have an "of counsel" relationship to the firm, and the requisites of a "close, regular, personal relationship" apply to them as well.

According to Formal Op. 90-357, there are four usual variants to the "of counsel" designation: (1) the "part-time practitioner, who practices law in association with a firm, but on basis different from that of the mainstream lawyers in the firm"; (2) a retired partner of the firm who is available for consultation; (3) a lawyer, usually a lateral hire, brought into the firm with the expectation that the lawyer will shortly become a partner; and (4) a lawyer who occupies a permanent senior position in the firm with no expectation of becoming a partner. These four examples underscore that "of counsel" should not be used to designate more casual relationships which depend on the occasional consultation; the co-counseling of a single case, even if it is of long duration; "a relationship involving only occasional collaborative efforts among otherwise unrelated lawyers or firms"; or a relationship based solely on making or accepting referrals.

The name of a lawyer who is of counsel to a firm should not appear in the name of the firm unless the lawyer who is of counsel is a retired name partner of the firm. Including the name of a lawyer who is simply of counsel without the status of a prior named partner would be deceptive and misleading in violation of Mass. R. Prof. C. 7.1 and 7.5 because of the implication that the of counsel lawyer is an actual member of the firm. In addition, an of counsel lawyer who allows her name to be used in the firm name risks being held responsible for the malpractice of the firm. It is proper, however, to designate on the firm stationery that a lawyer or law firm is of counsel so long as the listing is not deceptive and misleading. See MBA Op. No. 82-10. When there are jurisdictional limitations on the of counsel's license to practice law, the stationery must disclose those limitations.

Caution is advised before entering into an "of counsel" relationship. Both parties must be aware that the conflict-of-interest rules are applied as if the lawyers are all in the same firm, including disqualification by imputation under Mass. R. Prof. C. 1.10, 1.11(a), and 1.12(c).

The problems are multiplied when a lawyer or firm has an of counsel relationship with more than one lawyer or firm, since all of the lawyers in those firms may be disqualified, even if their only connection is the same of counsel lawyer. A comprehensive conflicts check is therefore in order whenever lawyers enter into and maintain an of counsel relationship. In addition, Mass. R. Prof. C. 3.7(a), which governs when a lawyer advocate may appear as a witness, applies to the lawyer who is of counsel. On the other hand, the of counsel lawyer may not divide fees with the firm as if they are all in the same firm: the client must consent in advance to a division of fees between the lawyer who is of counsel and the lawyer who is receiving the advice. Mass. R. Prof. C. 1.5(e).

Any lawyer considering an of counsel relationship should consider all of these ramifications. For lawyers who desire more information on the relationship, The Of Counsel Agreement: A Guide for Law Firm and Practitioner, by Harold G. Wren & Beverly J. Glascock (ABA Senior Lawyers Division 1991), provides a comprehensive examination of the evolution of rules governing the "of counsel" arrangement and contains sample contracts for lawyers.



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