By John W. Amberg
Amberg is a litigation partner in Bryan Cave Leighton Paisner LLP and a member of LACBA’s Professional Responsibility and Ethics Committee. The views expressed here are his own.

Articles are provided regularly by LACBA’s longstanding Professional Responsibility and Ethics Committee. 

Recent legal pronouncements highlighted a curiosity in California jurisprudence – the absence of a definition of “the practice of law.” It’s not that we lack definitions. In fact, definitions abound, but the practice of law is not defined by statute or rule in California and no single overarching definition has emerged in the cases, which raises questions about access to justice, the unauthorized practice of law (UPL), and the preservation of the attorney-client privilege.

Some background is provided by the seminal UPL case Birbrower, Montalbano, Condon & Frank v. Superior Court (1998) 17 Cal.4th 119, in which the California Supreme Court held that lawyers admitted in New York but not California had engaged in the unlicensed practice of law when they came here to initiate an arbitration, in violation of the State Bar Act, Bus. & Prof. Code section 6125 which states that only active members of the State Bar can “practice law” in California.[1] 

The 1927 legislature that enacted the statute made the case more difficult by neglecting to define “practice law” but the majority opinion adopted a definition from People v. Merchants Protective Corp. (1922) 189 Cal. 531, 535 (In Bank): “the doing and performing services in a court of justice in any matter depending therein throughout its various stages and in conformity with the adopted rules of procedure.” Additionally: “legal advice and legal instrument and contract preparation, whether or not these subjects were rendered in the course of litigation.” Ibid. None of this precisely encompassed the activities of the Birbrower lawyers, but even this definition was too broad for Justice Kennard who dissented, noting dismissively that the Merchants court had borrowed it verbatim from an 1893 decision by an Indiana intermediate appellate court. Instead, she cited the Court’s more recent definition of legal practice from Baron v. City of Los Angeles (1970) 2 Cal. 3d 535, which had the support of the chief reporter for the American Law Institute’s (“ALI”) Restatement of the Law Governing Lawyers: “representation of another in a judicial proceeding or an activity requiring the application of that degree of legal knowledge and technique possessed only by a trained legal mind.” Between Indiana and ALI, there was no contest. Moreover, Justice Kennard observed, because an arbitrator is not constrained to follow the law, representation in an arbitration did not invariably require a trained legal mind. Therefore, a triable issue existed whether the lawyers were even practicing law at all. Birbrower, 17 Cal.4th at 146.[2]

Most of the other cases in which lawyers were disbarred or otherwise disciplined for practicing law without an active license sidestepped defining the practice of law because the offending activities fell squarely within traditional legal services.[3] However, when the lawyer in Crawford v. State Bar of California (1960) 54 Cal.2d 659 (In Bank), argued that he had not aided and abetted his disbarred father’s unauthorized practice of law because the latter’s services could have been performed by non-lawyers, the unanimous Supreme Court pushed back, affirming his public reproval: “Although [the disbarred lawyer’s] services might lawfully have been performed by title companies, insurance companies, brokers and other laymen, it does not follow that when they are rendered by an attorney, or in his office, they do not involve the practice of law. People call on lawyers for services that might otherwise be obtained from laymen because they expect and are entitled to legal counsel.” Id. at 667-68.

This tangled legacy recently swam back into view. Last year, the legislature shot down several initiatives by the California State Bar designed to expand access to legal services. When the Paraprofessional Working Group recommended enlarging the practice of law by allowing non-lawyers to provide limited legal services in the areas of consumer debt, employment and family law, the alarmed chairs of the Assembly and Senate judiciary committees warned that any proposal to “fundamentally alter the sacrosanct principles of the attorney-client relationship” would be heavily scrutinized. They followed up with Assembly Bill 2958, which was signed into law in September 2022 and directed the State Bar to discontinue work on these recommendations until 2025.

Earlier this year, ethics mavens were disappointed when the U.S. Supreme Court dismissed a writ of certiorari as improvidently granted in In re Grand Jury, 598 U.S. ___, Jan. 23, 2023 (Per Curiam), a criminal tax case, and failed to resolve a split among circuits over the test for attorney-client communications that serve dual purposes of legal advice and business advice. The Ninth Circuit held the privilege did not apply unless the primary purpose of the communication was to give or receive legal advice. The defendant in the case refused to comply with a government subpoena but the district court overruled its objections based on the privilege, and the appeals court affirmed, holding that the primary purpose of the communications was to obtain tax advice, not legal advice. 13 F.4th 710 (9th Cir. 2021), as amended, 23 F.4th 1088 (2022).

This distinction puzzled many, including some lawyers who charge stiff fees for advice to nervous taxpayers. Don’t tax lawyers give legal advice? Isn’t advice from a lawyer, especially advice regarding taxes, precisely the kind of advice that requires legal knowledge? Not always, according to cases dating back 69 years which distinguish communications regarding the preparation of tax returns, which are not covered by the attorney-client privilege, Olender v. United States, 210 F.2d 795 (9th Cir. 1954), from communications regarding what to claim on a tax return, which are privileged. United States v. Abrahams, 905 F.2d 1276 (9th Cir. 1990), rev’d on other grounds by United States v. Jose, 131 F.3d 1325 (9th Cir. 1997). The Ninth Circuit explained that since there is no accountant’s privilege, the taxpayer should not obtain greater protection from government investigators by hiring a lawyer as a tax preparer. 23 F.4th at 1095. Evidently, when some tax lawyers communicate with their clients, their communications are not privileged because they’re not practicing law.

By contrast to the federal court, California takes a more protective view of the attorney-client relationship. In Costco Wholesale Corp. v. Superior Court (2009) 47 Cal. 4th 725, the court held that communications that arose in the attorney-client relationship were presumed privileged, even if they contained factual information that could have been gleaned by a non-lawyer investigator. The information doesn’t become unprivileged because it could have been discovered by some other means. Id. at 735-36. If the lawyer obtained information instrumental to her legal advice, the entire communication was privileged. Ibid.

In June 2023, the question of what constitutes the practice of law surfaced again when the America Bar Association issued ABA Formal Ethics Opinion 506 to consider UPL in the context of initial client intake. Entitled “Responsibilities Regarding Nonlawyer Assistants,” the opinion described the common business practice of having a non-lawyer handle new client intake tasks such as obtaining initial information about the matter, performing an initial conflict check, determining whether the assistance sought is germane to the lawyer’s practice, answering general questions about the fee agreement or process of representation, and obtaining the client’s signature on the fee agreement. Many lawyers delegate such housekeeping tasks to staff without a second thought, but the opinion reminds that a lawyer has a duty under Rule 5.3 to avoid assisting in the unauthorized practice of law, and a duty under Rule 5.5 to supervise non-lawyers to ensure their conduct is compatible with the professional obligations of the lawyer. Comment [2] to Rule 5.3 recognizes that legal services may be delegated to agents of the lawyer: “Lawyers generally employ assistants in their practice . . . [who] act for the lawyer in rendition of the lawyer’s legal services.” However, do such intake tasks constitute legal services? Are the non-lawyers engaged in the practice of law? Opinion 506 doesn’t answer these questions, concluding: “Ultimately, the scope of what the nonlawyers may do in this context will depend on whether the services in question constitute the practice of law in the jurisdiction where they are being provided.” Id. at pp. 4-5. Noting the obvious, the ABA wrote: “Different jurisdictions may have different views on what constitutes the practice of law.” Id. at p. 1, fn. 3. Or, as in California, different views may exist in a single jurisdiction.

The routine intake tasks described by Opinion 506 do not meet the definitions of the practice of law proffered by either the majority or the dissent in Birbrower. However, if the prospective client asks what legal services she needs or seeks interpretation of the engagement agreement, the ABA counsels that a lawyer must consult directly with the client rather than delegate to an assistant. Id. at p. 4. Ultimately, according to Opinion 506, the burden is on the lawyer to know what constitutes the practice of law: “Lawyers should understand how [the practice of law] is defined in their jurisdiction and take care that the supervised nonlawyers understand that definition and how it limits what nonlawyers may do.” Ibid.

As history tells us, however, the boundaries of the practice of law are not always clear and obvious. In federal court, services provided by a lawyer may not constitute the practice of law if a non-lawyer could perform the same services, such as filling out a tax return. See, In re Grand Jury, supra. In California state court, a more expansive definition may prevail, and so the practice of law will be described in terms of a lawyer’s typical functions - representing a client before a tribunal, giving legal advice, or drafting legal documents. See, Birbrower etc. v. Superior Court, supra. It is reasonable to assume that California will continue to defend the traditional idea of a specialized profession from encroachment by both out-of-state lawyers and homegrown unlicensed competitors by defining the practice of law broadly.

 

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[1] Rule of Professional Conduct 5.5(b) also prohibits a lawyer who is not admitted in California from (1) establishing or maintaining a resident office or other systematic or continuous presence in this state for the practice of law, or (2) holding out to the public or representing that the lawyer is admitted to practice law in California. The Rules do not define “practice of law” or “practice law”.

[2] Notwithstanding Section 6125, California and federal courts have long had the ability to admit foreign litigators to practice pro hac vice, and post-Birbrower, the Supreme Court created a range of exceptions, now codified in Rules of Court 9.40-9.49.1.

[3] See, e.g., In the Matter of Burke (2016) 5 Cal. State Bar Rptr. 448 (appearing at court); In the Matter of Taylor (1991) 1 Cal. State Bar Ct. Rptr. 563 (filing lawsuits); Morgan v. State Bar (1990) 51 Cal.3d 598 (negotiating with opposing counsel); In re Cadwell (1975) 15 Cal.3d 762 (settling case).