Can a lawyer work as a salaried business consultant for a corporation and give legal advice to the corporation's clients, who are billed by the corporation?
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This page answers the general question as of 1988. Ezel answers yours: whether it's allowed on your facts, under the current rules of professional conduct in your state, with citations.
Plain-English summary
The inquiry concerned whether a lawyer could be employed as a business consultant for a private corporation and, on behalf of the employer, perform basic legal services such as drafting contracts and giving legal advice to clients of the corporation. As the committee understood it, the lawyer would be paid a salary by the corporation, and the clients would be billed by the corporation at an hourly rate.
The committee was of the opinion that if what the lawyer did constituted the practice of law, then such conduct would be prohibited by RPC 5.4(a), because it would constitute sharing legal fees with nonlawyers. The committee added that it could not give an opinion on the legal question of what constitutes the practice of law.
Currency note
This opinion was issued in 1988, before the 2006 revisions to the Washington Rules of Professional Conduct. The rule then numbered RPC 5.4(a), barring a lawyer from sharing legal fees with a nonlawyer, corresponds to Model Rule 5.4(a) and was later amended. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule mentioned here.
Common questions
Q: Can a corporation bill its clients for legal work a salaried lawyer performs for them?
A: Per the opinion, not if that work is the practice of law. The committee was of the opinion that the arrangement would be prohibited by RPC 5.4(a) as sharing legal fees with nonlawyers if what the lawyer did constituted the practice of law.
Q: Did the committee decide whether the lawyer's work was the practice of law?
A: No. The committee was of the opinion that it could not give an opinion on the legal question of what constitutes the practice of law, leaving that determination outside its role.
Q: What turns the arrangement into prohibited fee sharing?
A: The corporation, a nonlawyer, billing clients at an hourly rate for the lawyer's legal services. The committee treated that as sharing legal fees with nonlawyers under RPC 5.4(a), conditioned on the work being the practice of law.
Background and rules framework
The opinion applies the rule then numbered Washington RPC 5.4(a), corresponding to Model Rule 5.4(a), which bars a lawyer from sharing legal fees with a nonlawyer. The committee made the outcome turn on whether the lawyer's services were the practice of law, a legal question it declined to answer, and concluded that if they were, the corporation's billing of clients for them would be impermissible fee sharing.
Citations and references
Rules of Professional Conduct:
- Washington RPC 5.4(a) (sharing legal fees with a nonlawyer), corresponding to Model Rule 5.4(a).
See also
- WSBA Ethics Op. 1143: a salaried lawyer at a nonprofit that bills its members for legal services
- WSBA Ethics Op. 1177: a proposed contractual relationship for real estate closings (fee splitting)
- WSBA Ethics Op. 1119: a partnership with a nonlawyer for a service not constituting the practice of law
Source
- Landing page: https://ao.wsba.org/print.aspx?ID=264
Original opinion text
Reproduced from the official source for research purposes. The linked source is authoritative.
Advisory Opinion: 1184
Year Issued: 1988
RPC(s): RPC 5.4(a)
Subject: Division of fees with nonlawyers; employment as business consultant giving legal advice to clients of corporation
The Committee considered your inquiry concerning whether a lawyer could be employed as a business consultant for a private corporation and, on behalf of the employer, perform basic legal services such as drafting contracts and giving legal advice to clients of the corporation. The Committee understood that the lawyer would be paid a salary by the corporation, and that the clients would be billed by the corporation on an hourly rate. The Committee was of the opinion that if what the lawyer did constituted the practice of law, then such conduct would be prohibited by RPC 5.4(a) because it would constitute sharing legal fees with non-lawyers. The Committee cannot, however, give an opinion regarding the legal questions of what constitutes the practice of law.
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