Two independent lawyers who lecture together want to form a joint 'firm' in a niche field while keeping their separate practices. Can we hold ourselves out that way?

Plain-English summary

Attorney A practices as a principal of a Rhode Island professional service corporation. Attorney B, unaffiliated with A, practices in a separate office in another city. A and B frequently lecture together and have developed a reputation as a "team" in a particular area of law, though they practice independently. They wished to form an entity -- a professional service corporation, general partnership, or sole proprietorship -- to hold themselves out to the public as a "firm" practicing in that specialized field, while maintaining their individual practices for other matters.

The opinion notes that the Rhode Island Professional Services Corporation Act provides that "no individual may be an officer, shareholder, director or employee of any other corporation engaged in the practice of the same profession without the written prior approval of the applicable regulatory agency or agencies," R.I. Gen. Laws Section 7-5.1-3. It therefore concludes that Attorney A may not practice law in two professional corporations.

As to other forms of practice, the opinion concludes that the Rules of Professional Conduct do not address the issue with sufficient certainty to provide the basis for an opinion that would protect Attorney A in proceeding. It cautions that an attorney's practicing simultaneously in more than one "firm" may be misleading to the public and may result in unintended liabilities for members of the several "firms."

In practice

Under this opinion, the professional-corporation route is foreclosed by statute absent regulatory approval, and the Panel does not endorse the other proposed structures because the Rules leave the question insufficiently clear. The opinion's caution identifies two concerns with holding out membership in more than one firm: potential to mislead the public, and unintended liability exposure for members of the several firms.

Common questions

Q: Can a Rhode Island lawyer practice in two professional corporations at once?

A: No. The opinion concludes the Professional Service Corporation Act bars it without written prior regulatory approval.

Q: Did the Panel approve forming a second joint firm as a partnership or sole proprietorship?

A: No. The opinion concludes the Rules do not address the issue with enough certainty to support an opinion protecting the lawyer in proceeding.

Q: What did the Panel caution about holding out a second firm?

A: The opinion cautions that practicing simultaneously in more than one firm may be misleading to the public and may result in unintended liabilities for members of the several firms.

Background and rules framework

The dispositive authority is not a Rule of Professional Conduct but the Rhode Island Professional Services Corporation Act, R.I. Gen. Laws Section 7-5.1-3, which conditions membership in a second same-profession corporation on prior regulatory approval. The opinion measures the remaining forms of joint practice against the Rules of Professional Conduct generally and finds them insufficiently determinate to support a protective opinion, while flagging the public-perception and liability concerns.

Citations and references

Rules of Professional Conduct:

• None cited. The opinion turns on the Professional Service Corporation Act and offers a general caution rather than applying a specific Rule.

Statutes:

• R.I. Gen. Laws Section 7-5.1-3 (a person may not be an officer, shareholder, director, or employee of another corporation in the same profession without written prior regulatory approval)

See also

• RI EAP Opinion 91-14: a Rhode Island professional corporation may partner with an out-of-state firm
• RI EAP Opinion 92-95: a firm trade name from partners' initials is misleading under 7.1/7.5

Source

• Landing page: https://www.courts.ri.gov/attorney-resources/Pages/Ethics-Advisory-Panel-default.aspx
• Original PDF: https://www.courts.ri.gov/Opinions/EAP%2093-41.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

(FINAL)
ETHICS ADVISORY PANEL
Opinion #93-41, Request #375
Issued July 28, 1993

The inquiring attorney, Attorney A, is presently engaged in the practice of law as a principal of a Rhode Island professional service corporation. Attorney B, who is not affiliated with Attorney A, practices law in a separate office in another city. Attorney A and Attorney B frequently lecture together to various groups. They have developed a reputation as a "team" in a particular area of law notwithstanding that they practice independently. Attorney A and Attorney B would like to form an entity, such as a professional service corporation, general partnership or sole proprietorship and hold themselves out to the public as a "firm" practicing in this specialized field, yet maintain their individual practices for other matters.

The Panel notes that the Rhode Island Professional Services Corporation Act states that "no individual may be an officer, shareholder, director or employee of any other corporation engaged in the practice of the same profession without the written prior approval of the applicable regulatory agency or agencies." R.I. Gen. Laws § 7-5.1-3 (1956, Reenactment 1992). Therefore, Attorney A may not practice law in two professional corporations.

With regards to other forms of practice, the Panel concludes that the Rules of Professional Conduct do not address this issue with sufficient certainty as to provide the basis for an opinion that would protect Attorney A in proceeding with his/her proposed course of conduct. The Panel cautions that an attorney's practicing simultaneously in more than one "firm" may be misleading to the public and may result in unintended liabilities for members of the several "firms."