(Inquiry No. 2012-2 )
Practice Limitations Placed on Retired Attorneys—Responsibility of Retired Attorneys to Identify Status on Letterhead Used in Pro Bono Representations
Attorney, who has been in private practice for several decades, and has developed a loyal clientele of individuals and institutions who have sought his advice and services over the years, plans to retire from the practice of law and to certify his status as “retired” with the Office of Court Administration. He anticipates that some of his clients will, on occasion, continue to solicit his counsel, and he expects that they may also ask him, when necessary, to hold funds and property in trust, as he has done in the past. The attorney also intends to continue in a position he holds as the executor of an estate, and to eventually act as a trustee to a charitable fund set up by that estate. He plans to take no fee for the advice that he gives or the services he performs. He asks to what extent his “retired” status will restrain him from performing these functions and what, if any, steps he must take to identify his retired status on office signage, stationery, and in directory listings.
A retired attorney who has properly certified his status with the Office of Court Administration may continue to provide legal services to clients without restriction if those services are rendered without compensation and the client is fully informed of any material limitations that might be placed on the representation as a result of the attorney’s retired status—A retired attorney who agrees to hold funds or property in trust for clients must comply fully with Rule 1.15 concerning preservation of identity of funds and property of others—A retired attorney may give legal advice and provide legal services as an executor and trustee provided those services are rendered for no compensation—A retired attorney must disclose and explain his retired status to any prospective or current client with respect to any legal representation undertaken after retirement. But a retired attorney need not make any disclosure to third parties or adversaries with whom he deals on the client’s behalf, or alter office signage, personal stationary or directory listings to reveal that he is retired from practice.
22 N.Y.C.R.R. § 118.1.(g)
22 N.Y.C.R.R. § 1500.5(b)(4).
Inquiring attorney has been in private practice for over five decades, and he plans to retire from the practice of law in the near future. His intention is to renew his biennial registration with the Office of Court Administration, but to designate his status as “retired,” in accordance with 22 N.Y.C.R.R. §118.1(g). He does not intend to resign from the Bar. Over the years he has acquired a loyal clientele for whom he has performed traditional legal services, including holding funds in escrow. Many of his clients routinely come to him for advice, and they rely on his judgment. Often the advice that he is asked to give is not exclusively legal, but may also involve considerations of business, ethics, or simply prudent conduct. He readily counsels them on those issues as well. His practice has also involved him in a number of civic and charitable projects and activities—most of which call on him to give some form of legal advice or to provide some ancillary, law-related service. He is, for example, the executor to a “sizable estate” and expects to be appointed a trustee to a charitable fund established by the estate. He intends to continue in the appointments that he holds; and he also anticipates that many of his former clients will continue to come to him for his counsel even after he retires.
He asks what limitations his status as a retired attorney will place on his ability to counsel his former clients, to give legal advice in his capacities as an executor and trustee, and to hold funds or property in trust if asked to do so. His own thinking is that if he is asked for his advice, whether it be in casual conversation or in a more formal context, he will continue to give it freely, but without charging a fee, and only after explaining that he is retired from the practice of law and that his opinion, at least to that extent, should not be relied upon as current. As an executor he has his own legal representation: a colleague who he trusts and who he intends to keep when he assumes his role as a trustee. But he describes that arrangement as “collaborative,” rather than a conventional attorney-client relationship, given his own knowledge of the area. In these activities he intends to continue to field legal questions when asked and to assist with miscellaneous “law related” tasks as he has done in the past—again without charging a fee. He wishes to know if his retired status would limit or forbid this activity. Currently, when he holds funds for clients he segregates those funds in properly designated attorney trust accounts in compliance with New York Rules of Professional Conduct (RPC) 1.15 (formerly DR 9-102). When he retires he contemplates performing this service as a simple fiduciary, or Escrowee, using a separate bank account with no reference to him as an attorney. Finally, the attorney asks how far he must go to erase his identity as an attorney, or qualify it as a “retired” attorney. He plans to remove any indicia of a formal law office, dispose of his professional stationery and close his attorney bank accounts. But he has personal stationery that includes the title “Esq.”; an email address containing the suffix “lawoffice.com”; and myriad listings in telephone directories, bar registers and data bases that identify him as an attorney and, therefore, may suggest to the public that he is an active practitioner. He asks if he must terminate or modify these listings.
An attorney may retire from the practice of law and yet remain admitted to the New York Bar. Judiciary Law § 468-a(4); 22 N.Y.C.R.R. § 118.1. An attorney does so by certifying that he or she has “retired from the practice of law” in the registration statement required to be filed with the Chief Administrator of the Courts. Once retired, the attorney must continue to comply with the biennial registration requirements of Judiciary Law § 468-a—although the biennial registration fee and the mandatory continuing legal education requirements are waived. (See 22 N.Y.C.R.R. § 118.1(g) and 22 N.Y.C.R.R. § 1500.5(b)(4), respectively.) Otherwise, notwithstanding retirement, the attorney remains subject to The Rules of Professional Conduct; the appropriate statutes governing attorneys and counselors at law, such as those promulgated under Article 15 of the Judiciary Law; and all regulatory requirements imposed by the Chief Administrator of the Courts and the Appellate Division where the attorney is enrolled.
In essence, “retirement” contemplates that the attorney will cease practicing law for compensation. 22 N.Y.C.R.R. § 118.1.(g) provides,
an attorney is “retired” from the practice of law when, other than the performance of legal services without compensation, he or she does not practice law in any respect and does not intend to ever engage in acts that constitute the practice of law.” (Emphasis supplied.)
That section further defines the “practice of law” as:
the giving of legal advice or counsel to, or providing legal representation for, [sic] particular body or individual in a particular situation in either the public or private sector in the State of New York or elsewhere, it shall include the appearance as an attorney before any court or administrative agency.
The same regulation acknowledges that retired attorneys may continue to perform pro bono legal services; and indeed states that where the attorney participates without compensation in an approved pro bono legal services program, the attorney may be designated as an “attorney emeritus.” To this extent the practice of law is not entirely foreclosed to an attorney who retires from practice. And therein lies a significant distinction between an attorney who has retired from the practice of law, in the manner prescribed by the Chief Administrator of The Courts, and an attorney who has resigned from the Bar. An attorney who resigns may not practice law or represent another person for any purpose, even without taking a fee.
Accordingly, to the extent that the retired attorney’s legal advice or services are sought, whether formally or informally, they may be given on the condition that the retired attorney receives no compensation in return. We caution, however, that in rendering a legal service, even without compensation, the attorney remains subject to the Rules of Professional Conduct. Indeed, since an attorney-client relationship does not depend on the existence of a formal retainer agreement or upon payment of a fee (See Moran v. Hurst, 32 A.D.3d 909; Hansen v. Caffrey, 280 A.D.2d 704; Jane St. Co. v. Rosenberg & Estis, P.C., 192 A.D.2d 451) the retired attorney not only retains all of the traditional duties owed to the client under the Rules of Professional Conduct, but is also exposed to the potential liabilities of professional negligence. The attorney’s responsibilities under the Rules include, among others, the obligation to provide the client with competent representation (RPC 1.1); the duty to represent the client diligently (RPC 1.3); the duty to communicate with the client fully and effectively (RPC 1.4); to preserve the confidentially of information (RPC 1.6); and to avoid and remedy conflicts of interest (RPC 1.7-1.10). A retired attorney should, therefore, be circumspect concerning the legal services he or she is willing to undertake, even in consideration of long standing client relationships or the candid disclosure to the client of the attorney’s “retired” status. For example, to the extent that the attorney’s knowledge of the legal issues concerning the matter has lapsed or, perhaps, the thoroughness of the preparation of the matter will be impaired by his retired status, these limitations may compromise the competence and diligence owed to the client under RPC 1.1 and 1.3. The same might be true if a lack of office support systems prevent the attorney from performing effective conflict analysis; or competent legal research and analysis; or impair the protection of confidential information. These are all obligations that the attorney continues to owe to the client notwithstanding the fact that the attorney is retired, has advised his client as such, and is not taking a fee for his service.
Mindful of these concerns, however, this Committee appreciates that an attorney with many decades of experience will likely have clients of long-standing, whose close trust the attorney has earned over the course of much time and many dealings. And he may continue to bring to the benefit of these clients a wealth of knowledge of his clients’ affairs that may not be easily replicated by new representations. A long-trusted attorney may be an irreplaceable resource for some clients, and consequently should be available to the client if the attorney, although formally retired, is willing and able to volunteer those services. All the more if the client has come to value the attorney’s professional judgment and covet the attorney’s advice in general. Rule 2.1 calls upon attorneys to render candid advice to their clients—advice that need not be limited to the law, but may also take into account “considerations of moral, economic, social, psychological, and political factors that may be relevant to the client’s situation.” This Rule borrows from former EC 7-8, which counseled, in part: “[the] advice of a lawyer to the client need not be confined to purely legal considerations. . . . A lawyer should bring to bear upon this decision making process the fullness of his or her experience as well as the lawyer’s objective view point.” (Emphasis supplied.) A client of many years, who is knowledgeable of his attorney’s retired status, but who pursues his counsel nonetheless, likely places great importance on the retired attorney’s judgment—and perhaps even considers it irreplaceable. Thus, we believe that an attorney’s retired status should place no additional ethical restrictions on the performance of legal services beyond the obligation to fully inform the client of the attorney’s retired status and to advise the client of any material limitations that this status may impose on the representation.
With respect to the holding of funds or property in trust, we note that one need not be an attorney to hold funds in escrow or to otherwise manage the funds or property of a third-party as a fiduciary. (See e.g., H & H Acquisition Corp. v. Financial Intranet Holdings, 669 F.Supp.2d 351). That service may be entirely detached from a legal representation or the act of giving legal advice. In such situations the law of fiduciaries would govern the obligations and liabilities of the parties to the transaction, including those of the escrowee. But, a retired attorney continues to hold his office, and as such is fully subject to the Rules of Professional Conduct. RPC 1.15 sets out these responsibilities in great detail, including the special accounts that must be maintained, the record keeping requirements, and the duties generally owed by attorneys holding funds or property of others in trust.2 The Rule recognizes no distinction between the funds or property that an attorney holds for a client as opposed to property held for non-clients. Thus, it makes no difference that the escrow arrangement is not in the context of an attorney-client relationship or is not incidental to a legal representation. Nor does the Rule exempt or modify the requirements for attorneys who have certified their status as “retired.” Any attorney who provides this service is bound to comply with the Rule. Accordingly, if the retired attorney continues to provide this service on behalf of former clients—again, presumably without compensation—the requirements of Rule 1.15 must be met in full. The inquiring attorney may not, therefore, hold funds for clients as described, but must continue to fulfill his duties as an attorney under the Rules of Professional Conduct, and continue his attorney’s special or trust bank accounts using the required attorney-client descriptive language.
A retired attorney should similarly continue to comply with all Rules of Professional Conduct relating to professional notices, letter heads and signs. RPC 7.5 imposes no special obligation on retired attorneys to identify their status as such by amending their signage, professional notices or letterhead. However, Comment  of the Rule advises that, “in order to avoid the possibility of misleading persons with whom a lawyer deals, a lawyer should be scrupulous in the representation of professional status.” (Emphasis supplied.) Retirement from the practice of law represents a significant change in the attorney’s professional status. As between himself and any client he agrees to represent without fee, that status is relevant and potentially consequential. It among other things allows the requirement that he take no fee from the representation to be policed. We conclude that the attorney must disclose and explain his status to any client when undertaking legal representation after retirement. We should note that our opinion departs, somewhat, from the Opinion of our fellow Committee of the Association of the Bar of the City of New York. In Formal Opinion Number 2005-6 (2005) that Committee concluded, from a similar inquiry, that a retired attorney need not reveal his retired status to a client. That opinion considered, among other things, the effect of the retired attorney’s exemption from CLE requirements, and concluded that the attorney’s general requirement to provide competent representation (RPC 1.1) rendered the exemption from CLE requirements immaterial. In the instant situation, inquiring counsel has forthrightly noted that he intends to candidly inform clients “that he is retired from the practice of law and that his opinion, at least to that extent, should not be relied upon as current.” This may be viewed as an attempt to “limit the scope of the representation.” See, RPC 1.2. However, such an attempt would itself be subject to FRCP 1.1. See, Comment  to FRCP 1.2. Together with the necessity that the client be appraised of the requirement that no fee be charged, we have concluded that FRCP 7.5, as amplified by Comment , mandates the disclosure and explanation of the attorney’s retired status to the client.
However, the attorney need not announce that he is now retired from practice in communications with others. He need make no disclosure to third parties or adversaries with whom he deals on the client’s behalf, and need not amend his directory listings, personal stationestationeryry or even the shingle outside his home or office.
[Approved by the Full Committee on October 10, 2012]
1 An attorney may resign the office by application to the Appellate Division in which he or she is enrolled. In the Second Judicial Department, after entry of an order accepting the attorney’s resignation, the attorney may not accept any new retainer or engage in any new case or legal matter of any nature as an attorney for another (22 N.Y.C.R.R. § 691.10(e)); and must fully comply with the conduct and notice requirements set forth in in Judiciary Law §§ 478, 479, 484, and 486, and 22 N.Y.C.R.R. § 691.10.
2 A full exposition of the requirements of R 1.15 for attorneys holding funds and property of clients is beyond the scope of this opinion. But in general, funds belonging to another must be segregated from the lawyer’s own funds and maintained in a special account in a banking institution that agrees to provide dishonored check reports in accordance with the provisions of 22 N.Y.C.R.R. Pt 1300.