Ezel / Ethics Opinions / COBAR
COBAR February 19, 1983

Can a Colorado lawyer take a job with a traffic-ticket clinic that is owned and operated by nonlawyers?

Short answer: The opinion concluded that a lawyer may not enter an employment relationship with a traffic clinic owned and controlled by nonlawyers where the clinic sets the fee schedule, collects fees from clients, keeps part for its own profit, and pays the lawyer a flat retainer, because the arrangement is an impermissible division of fees with nonlawyers and the lawyer's participation aids the clinic's unauthorized practice of law; the opinion also flagged independence and withdrawal problems with such arrangements.

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This page answers the general question as of 1983. Ezel answers yours: whether it's allowed on your facts, under the current rules of professional conduct in your state, with citations.

Currency note: this opinion is from 1983
Subsequent statutory amendments, court decisions, or later opinions or rule amendments may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
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Plain-English summary

Opinion 63 (adopted February 19, 1983; addendum issued 1995) addressed whether a lawyer may take employment with a traffic clinic owned and operated by nonlawyers. In the proposed arrangement, the clinic handled traffic offenses through disposition, provided advertising, forms, and an answering service, set a fee schedule based on the offender's record and the charge, collected the fees, paid the lawyer a flat monthly retainer plus separate trial fees, and kept the remaining funds for overhead and profit. The nonlawyer owners said they would not control the handling of cases.

The Committee identified two principal violations under the Code of Professional Responsibility. First, aiding the unauthorized practice of law: the clinic's services (defending penal traffic charges) are legal services, and where a corporation's nonlawyer officers control attorney-employees who provide legal services as the corporation's only source of income, the corporation engages in the unauthorized practice of law; under DR 3-101 the clinic lawyer would be aiding that unauthorized practice. Second, division of fees: because the clinic collects the fee from the client and then pays the lawyer a portion as a retainer while keeping the balance for operations and profit, the arrangement is an impermissible division of fees between a lawyer and nonlawyers, contrary to DR 3-102.

The Committee also flagged additional problems. The likely employer-employee relationship creates a potential for nonlawyer principals to influence the lawyer's independent professional judgment (DR 5-107; EC 5-22 to 5-24). A clinic lawyer's departure raises questions about what happens to clients' cases and about charging a second fee for plea bargaining already paid for, implicating the withdrawal and fee rules (DR 2-110, DR 2-106) and the duty of zealous, undivided representation under Canon 7. And the referral of trial-bound cases to the handling clinic attorney, rather than an open referral, might not comply with the lawyer-referral provisions of DR 2-103. The Committee concluded that, because of the impermissible fee division and the proscription against aiding unauthorized practice, a lawyer may not enter such an employment relationship; it did not purport to define the unauthorized practice of law itself.

Currency note

This opinion was issued in 1983 under the former Colorado Code of Professional Responsibility, before the Colorado Rules of Professional Conduct took effect on January 1, 1993, and before Colorado's 2008 revisions to those rules. A 1995 addendum mapped the opinion to Rule 5.5(b) (assisting unauthorized practice), Rule 5.4 (sharing fees with nonlawyers), and Rules 5.4 and 2.1 (independent professional judgment). Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Could a Colorado lawyer be employed by a nonlawyer-owned traffic clinic?

A: No. The opinion concluded a lawyer may not enter an employment relationship with a traffic clinic owned and controlled by nonlawyers, because of the impermissible division of fees with nonlawyers and the prohibition on aiding a corporation's unauthorized practice of law.

Q: Why was the clinic's fee arrangement a problem?

A: The opinion concluded that because the clinic collected the client's fee and then paid the lawyer a portion as a retainer while keeping the rest for operations and profit, the arrangement was an impermissible division of fees between a lawyer and nonlawyers under DR 3-102.

Q: Why did the lawyer's work amount to aiding unauthorized practice?

A: The opinion concluded that the clinic's services were legal services and that nonlawyer owners controlling attorney-employees whose legal work is the corporation's only income source is the unauthorized practice of law by the corporation, which the clinic lawyer would be aiding in violation of DR 3-101.

Q: Were there other concerns even if those two were resolved?

A: Yes. The opinion flagged the potential for nonlawyer principals to influence the lawyer's independent judgment, problems with what happens to clients' cases if the lawyer leaves, and possible noncompliance with the lawyer-referral rules when trial-bound cases were referred to the handling attorney.

Background and rules framework

The opinion interpreted the then-governing Colorado Code of Professional Responsibility, principally DR 3-101 (aiding the unauthorized practice of law), DR 3-102 (division of fees with nonlawyers), DR 5-107 (no third-party interference with professional judgment), DR 2-103 (referrals), DR 2-110 (withdrawal), DR 2-106 (fees), and Canon 7. The modern Model Rules analogs are Rule 5.4 (professional independence; no fee sharing with nonlawyers), Rule 5.5 (unauthorized practice), and Rule 2.1 (independent professional judgment).

Citations and references

Rules of Professional Conduct:

  • Colo. Code of Professional Responsibility DR 3-101, DR 3-102, DR 5-107, DR 2-103, DR 2-110, DR 2-106; Canon 7 (governing rules at issuance)
  • Colo. RPC 5.4 / Model Rule 5.4 (professional independence; sharing fees with nonlawyers; current analog)
  • Colo. RPC 5.5(b) / Model Rule 5.5 (assisting the unauthorized practice of law)
  • Colo. RPC 2.1 / Model Rule 2.1 (independent professional judgment)

Cases:

  • The Florida Bar v. Consolidated Business & Legal Forms, 386 So. 2d 797 (Fla. 1980), nonlawyer-controlled corporation providing legal services is unauthorized practice
  • People ex rel. MacFarlane v. Boyls, 197 Colo. 242, 591 P.2d 1315 (1979), discipline for aiding a corporation's unauthorized practice

Other opinions cited:

  • ABA Formal Ops. 122, 239, 297; ABA Informal Op. 1392 (fee division and unauthorized practice)

See also

Source

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