1. Paralegal Ethics Problems & Solutions
Michael E. McCabe, Jr.
NALS 65th Annual Education Conference &
National Forum
Nashville, TN
October 7, 2016

2. OUTLINE Overview Can and Can’t Dos Key Ethics Rules Competence
Confidentiality
Conflicts
Money
Unauthorized Practice of Law
Reporting Unethical Behavior

4. OVERVIEW Successful lawyers rely on legal assistants and paralegals.
Many para-professionals work autonomously.
Firms motivated to delegate to non- lawyers.
Paralegals and legal assistants must be mindful of applicable ethical norms and laws.

5. WHO ARE WE DISCUSSING? Legal Assistant/Paralegal:
a person qualified by education, training or work experience;
employed or retained by a lawyer, law office, corporation, governmental agency or entity;
performs specifically delegated legal work;
for which a lawyer is responsible.
ABA House of Delegates (Aug. 1997)

6. POSSIBLE SOURCES OF LAW
Lawyer Professional Conduct Rules
Paralegal Ethics Rules – NALA, NFPA, local paralegal associations
Civil Law
Contract (e.g. employment)
Tort (e.g. fiduciary duty)
Fed. and State laws (e.g. privacy).
Criminal Law (e.g. theft, UPL)

7. I’M OKAY – OR NOT

8. WHAT’S OKAY?
Lawyers can employ “the services of paraprofessionals and delegating functions to them, so long as the lawyer[s] supervise[] the delegated work and retain[] responsibility for their work.”
Non-lawyers may provide substantive legal support so long as they do so under the direction and supervision of a lawyer.
Model Rules of Prof’l Conduct R. 5.5 cmt. 2; Restatement of the Law Governing Lawyers § 4

9. WHAT’S OKAY? (Cont’d) Examples include:
work of a “preparatory nature.”
conducting legal research.
engaging in factual investigations.
preparing drafts of legal documents.

10. WHAT’S OKAY? (Cont’d) Catch-all: Caveat: Supervision required.
Any services that “enable the licensed attorney- employer to carry a given matter to a conclusion through his own examination, approval or additional effort.”
- See In re Easler, 272 S.E.2d 32, (S.C. 1980).
Caveat: Supervision required.

11. WHAT’S OKAY? (Cont’d) Lawyer’s Duty to Supervise:
A lawyer must give “appropriate instruction and supervision concerning ethical aspects of their employment.”
Reasonable efforts to establish internal policies and procedures to assure non- lawyers know, and conform with, ethics rules.

12. WHAT’S NOT OKAY?
Lawyer cannot delegate “professional legal judgment” to a paralegal.
Paralegal cannot hold self out as lawyer.
Paralegal may not engage in unethical behavior under Lawyer or Paralegal ethics rules.

13. PARALEGAL ETHICAL DUTIES

14. PARALEGAL ETHICS
“A paralegal’s conduct is guided by bar associations’ codes of professional responsibility and rules of professional conduct.”
NALA Canon 10.
Attorney ethics guided by some version of ABA Model Rules of Prof. Conduct.

15. COMPETENCE
Paralegals owe duty of “competent representation to a client.”
Competence requires “the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.” 
See ABA Model Rule 1.1.

16. COMPETENCE (Cont’d)
“A paralegal must strive to maintain integrity and a high degree of competency through education and training with respect to professional responsibility, local rules and practice, and through continuing education ”
See NALA Canon 6.

17. COMPETENCE (Cont’d)
“A paralegal must use discretion and professional judgment commensurate with knowledge and experience but must not render independent legal judgment in place of an attorney.”
See NALA Canon 4.

18. CONFIDENTIALITY
“A lawyer shall not reveal information relating to the representation of a client”
ABA Model Rule 1.6.
“A paralegal must protect the confidences of a client and must not violate any rule or statute” regarding attorney-client privilege.
NALA Canon 7.

19. CONFIDENTIALITY (Cont’d)
Paralegals have access to client and other party confidential information.
Opportunities abound to misuse or disclose.
Paralegal must protect client confidences.
Court orders and statutes (e.g. HIPAA) also require protection of non-client information.

20. CONFIDENTIALITY (Cont’d)
Do not share anything learned through the representation of a client with anyone outside the representation.
No discussions with spouse or friends.
If you learned it while representing a client, it is confidential.

21. CONFLICTS OF INTEREST Lawyers owe their clients loyalty.
Lawyers promise to keep their clients’ secrets.
Lawyers must put clients’ interests first.
Same goes for paralegals.

22. CONFLICTS (Cont’d)
A paralegal must disclose to employer any pre-existing client or relationship that may conflict with interests of the employer or prospective employer and/or other clients.
NALA Canon 8
Not just relevant when hired–issues can arise any time.

23. CONFLICTS (Cont’d)
Paralegal works for Law Firm on litigation for Company A vs. Company B.
Paralegal leaves Law Firm to work for New Firm.
New Firm is representing Company B in same litigation.
Is there a conflict issue?

24. CONFLICTS (Cont’d)
Paralegal had access to Company A’s confidential and privileged information.
Knowledge of Company A’s information could give Company B an advantage.
Result: Possible disqualification of New Firm.

25. CONFLICTS (Cont’d)
Supervising attorney must ensure paralegal’s conduct compatible with obligations of lawyer.
When paralegal “side switches,” court must determine if she learned confidential info. from prior employer. 
If yes, presumption it will be disclosed to new employer. 
Lamb v. Pralex Corp., 333 F. Supp. 2d 361 (D.V.I )

26. CONFLICTS (Cont’d) Continuing obligation to check for conflicts.
Paralegals must be screened for conflicts.
If potential conflict discovered, firm must decide how to address ethically.
Obtaining client consent.
Screening paralegal.
Not hiring the paralegal.
Continuing obligation to check for conflicts.

27. OTHER PEOPLE’S MONEY
One of the main sources of ethics complaints against attorneys.
Not uncommon for paralegals to handle client trust accounts.
Proper training in handling money is necessary:
prohibition on commingling client and lawyer funds.
record-keeping requirements.

28. FIRM MONEY Lawyers may not split fees with a paralegal.
Lawyers may not enter into partnership with paralegal.
Lawyers prohibited from paying fees for referring clients.
Lawyers may pay bonuses based on paralegal productivity and firm profitability.

29. UNAUTHORIZED PRACTICE OF LAW (UPL)
Criminal in some jurisdictions.
ABA Model Rules 5.5 prohibits lawyers from aiding in the unauthorized practice of law.
Adopted in every State.

30. UPL (Cont’d) General rule is that a non-lawyer cannot:
Appear in court on behalf of a client.
Establish attorney-client relationship.
Give legal opinions or advice.

31. UPL – COURT APPEARANCES
Depositions. A paralegal cannot take a deposition, even with a set of lawyer-approved questions, and cannot represent the interests of a client at a deposition.
Paralegals may attend, assist lawyer, observe.
Pleadings. A paralegal can never sign a pleading on behalf of a client.
Filing pleading constitutes an “appearance.”

32. UPL – UNDERTAKING
Neither a paralegal nor any other non-lawyer may establish the lawyer-client relationship
The lawyer alone decides whether to undertake representation and fee arrangement.
Lawyers have been severely disciplined for allowing paralegals to have clients sign retainer agreements without their having met the lawyer and without the lawyer’s having reviewed and assessed whether representation was appropriate.

33. UPL – LEGAL ADVICE
Directing or recommending course of action with legal consequences.
Explaining legal rights and responsibilities.
Evaluating probable outcome of a legal matter.
Interpreting statutes, decisions, and legal documents for a person.
Preparing legal documents for someone by applying knowledge of law to specific situation.

34. AVOIDING UPL
When signing or sending documents, identify self as a paralegal.
When orally communicating on behalf of firm with anyone, identify self as paralegal.
If a client asks for legal advice, just say no:
Tell client that you will pass on to lawyer.
If you’re a conduit, confirm in writing.
Be very wary of the unsophisticated client.

35. IF YOU SEE SOMETHING
SAY SOMETHING

36. WHAT IF
You believe your attorney is not competent to represent his clients?
He/she arrives at the office intoxicated by alcohol or high on drugs?
You become aware of a discreet affair entered into with a client or witness?

37. REPORTING MISCONDUCT Paralegals also required to report misconduct.
“A lawyer who knows that another lawyer has committed a violation of the Rules of Professional Conduct that raises a substantial question as to that lawyer's honesty, trustworthiness or fitness as a lawyer in other respects, shall inform the appropriate professional authority.”
ABA Model Rule 8.3(a)  
Paralegals also required to report misconduct.

38. TYPES OF MISCONDUCT Stealing. Overbilling. Harassment.
Failure to supervise.
Non-lawyers allowed to provide legal advice.
“Sign this for me.”
Lying.
Substance or alcohol abuse.
Etc., etc., etc.

39. REPORTING MISCONDUCT The “problem” lawyer.
Another trusted lawyer or employee.
Non-lawyer supervisor.
Partner or manager.
Outside lawyer.
Paralegal ethics board.
State Bar.
Law enforcement. 

40. CONCLUSION Follow your moral compass. Tell the truth. Ask for help.
Pretend you work for the CIA.
Watch out for other people’s misconduct.
This is really important stuff.
Ethical violations or moral misconduct are never fun to deal with, but are incredibly important to tackle head on.