MDP: The View From Main Street: Solos and small firms have their own concerns aboutnonlawyer partnersAuthor(s): JILL SCHACHNER CHANENSource: ABA Journal, Vol. 85, No. 12 (DECEMBER 1999), pp. 76-77Published by: American Bar AssociationStable URL: http://www.jstor.org/stable/27841322 .

Accessed: 18/06/2014 15:11

Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at .http://www.jstor.org/page/info/about/policies/terms.jsp

.JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range ofcontent in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new formsof scholarship. For more information about JSTOR, please contact support@jstor.org.

.

American Bar Association is collaborating with JSTOR to digitize, preserve and extend access to ABA Journal.

http://www.jstor.org

This content downloaded from 188.72.126.88 on Wed, 18 Jun 2014 15:11:49 PMAll use subject to JSTOR Terms and Conditions

GARY SCHLESINGER wishes he didn't have to send clients down the street for help with nonlegal aspects of their divorce cases.

MDP: The View From Main Street Solos and small firms have their own concerns about nonlawyer partners BY JILL SCHACHNER CHANEN

When Gary Schlesingers cli ents need help sorting out the non

legal details of a divorce, he escorts them to the door of his Libertyville, 111., office and points to the town's

main street.

There, says Schlesinger, a solo family law practitioner, he directs clients "down the street to the ac countant and even farther down the street to the therapist and even far ther to the real estate broker."

If Schlesinger had his way, he wouldn't have to guide clients out the door to other professionals. In stead, an accountant, a family ther apist and maybe even a real estate broker would be sitting right there in adjacent cubicles. In fact, they

would be his business partners. Schlesingers clients have a

regular need for those services, but ethics rules prohibit lawyers from sharing fees with nonlawyers. "What is wrong with all of us sitting in the same office?" asks Schlesinger.

Plenty, says Beverly Hills, Cal if., lawyer Jay Foonberg. For one, lawyers will lose their loyalty to their clients if they add nonlaw yers as partners, he says. "You will have two fiduciary duties: One to the client and one to the nonlawyer partner. Who is going to come first?"

Schlesinger and Foonberg rep resent the two sides in the ongoing debate among lawyers and within the aba over whether the Rules of Professional Conduct specifically, Model Rule 5.4 should be changed to allow multidisciplinary practice. The aba House of Delegates was to

have voted on the issue this sum mer but instead tabled it for further study.

The public debate mostly has centered on the encroachment of

multinational and growing ac

counting firms onto turf tradition ally occupied by large law firms.

Boon or Bust But multidisciplinary practice

also has become a lightning rod issue for solo and small-firm practi tioners, sparking discussions at bar

meetings, business lunches and in Internet chat rooms. Mdps have long been touted as the salvation for solo and small-firm practition ers who are seeing their markets eroded by pro se litigants, alterna tive dispute resolution and other nonlawyer service providers.

Some solo and small-firm prac titioners like Schlesinger believe that creating formal relationships with nonlawyers will better serve

their clients. It also could be finan cially rewarding by allowing law yers to sell or share in the fees from the sale of nonlegal products like insurance policies or real estate.

Others, like Foonberg, a mem ber of the House of Delegates, see such ancillary services as an ethical land mine. Among his concerns, says Foonberg, is the prospect that agency law will come into play when lawyers have conflicting fidu ciary duties, leaving the courts to decide to whom a lawyer is respon sible. "This is all about how to make

money, it is not about loyalty to cli ents," Foonberg says.

For Charles Robinson of Clear water, Fla., however, the ability to diversify the kind of services that lawyers can offer may be the key to the survival of solo and small-firm practitioners.

Robinson has seen financial planners, accountants and care managers chip away at his elder

IdeM

*9 Ah A Joumnal and molgeQ a%#IaRTnit lirIWer hve eamed up to ttAsA membs sii pn tig month Solo~ Network topik

.crt rm h non dusi bedW ooin theabtrp, endthis essge o lstsrve~abnetorg tuandeaotosez your e-maiIaddress (no other words

are necessary). Or preview Solosez on the intemnet at www abanet org/solo/homne html.

^ On multidisciplinary practice

Charles E. Whisonant cwhisonantewhisonant.com Newport Beach, Calif.

The MDP will require a redefinition of the conflicts, solicitation and fee sharing rules. I can envision a busi

ness model in which this could be a positive move for the legal profession by giving us freer rein on soliciting and accepting clients. We are going to have a relatively unsympathetic pub lic. Does anyone really think the gen eral public will really care if the legal

profession is dismantled? Especially if

it means fewer lawyers or lower fees.

76 ABA JOURNAL / DECEMBER 1999 ABAJ PHOTOS BY RICHARD SHAY AND DAVID FORBERT

This content downloaded from 188.72.126.88 on Wed, 18 Jun 2014 15:11:49 PMAll use subject to JSTOR Terms and Conditions

law practice. That leaves document drafting, perceived as the least valuable part of the client relation ship, as the only function left for

many solos and small-firm attor neys like him.

"Multidisciplinary practices may be one of the solutions for small-firm survival," says Robinson of Robinson & Chamberlain. "We are not protected by our licensure right now. We have the same set of issues as the big firms do. We can not compete."

Though he does not know whether he would create or join a

multidisciplinary prac tice, Robinson envisions an elder law practice that would combine the services of a lawyer, an accountant and a finan

cial planner. Such a prac tice would be more valu able to his clients in that all of their documents and their insurance plans could be completed and purchased at one time, he says.

More important, he would be able to quote his clients one fee for the entire package. "My cli ents do not like the idea of being sent out to two or three other places to get related services."

Others envision the opposite happening if MDPs were allowed.

"I think it would spell the demise of solo and small-firm practi tioners around the coun

BOB OSTERTAG sees lawyers' competitors "licking their

chops" at the idea of MDP.

Norman Gregory Fernandez Norman @ norman-law.com Los Angeles

I can see the major pitfalls and dangers associated with mdps, but what really concerns me are the ethi cal considerations.

As far as competition, mdps could become kind of like Kmarts or

Wal-Marts and provide legal services for prices we could not survive on as solos. I am not against good old-fash ioned capitalism. However, I do not

want to have to go work for Kmart to practice law, and I sure do not want to have nonlawyer partners telling me how to prosecute my cases.

try," says Bob Ostertag of Ostertag & O'Leary in Poughkeepsie, N.Y.

He says small practices would be squeezed out by big-time fran chises. What he fears most is the advent of full-service businesses offering, among other things, legal services.

"What I see is the Barnes & Noble coming in and destroying all the little bookstores," says Oster tag, who sits on a New York State Bar Association committee that is studying the issue of multidiscipli nary practice. "We now have these full-service accounting firms that

JoAnne Fray JoFray@aol.com Boston

Interestingly, the proposed rules change to allow multidisciplinary practice was touted as the salvation of small firms. I'm afraid that if I allied myself with nonlawyer professionals, the tail would begin to wag the dog, and I would quickly find myself work ing for them!

Wouldn't I be inclined to try to convince my client to purchase an in surance product that the insurance salesman in my firm carried, as op posed to another product that might be a tad more suitable for my client?

are hiring attorneys to represent anyone they can. It is just like the big bookstores coming in and sell ing books to anyone."

And, he adds, "It is not just the accounting firms. It's the insurance firms, the Sears, the Wards. They are just licking their chops."

Ostertag says solo and small firm practitioners would not be able to compete with a national re tailer if a place like Sears, for ex

ample, started offering legal ser vices to its customers through its stores.

Definition Lacking The proposed rule changes

have not, however, defined what kind of multidisciplinary partnerships would be allowed.

Edward Burton, a solo gen eral practitioner in Lewiston, Idaho, acknowledges Ostertag's concerns but does not share them. He believes that most so lo and small-firm practitioners could survive the full-service businesses and points to the ac

counting industry as the model for the future of the legal pro fession.

"The big accounting firms have not put the little guy out of business keeping books for small businesses and individu als," Burton says.

"The small accounting firms might not do the big an nual audits for large corpora tions, but they do help small businesses. Little firms can pro vide those same services at a lot less cost."

Still, "There are no guaran tees," he warns. "The fearmon

gers among us could be absolute ly correct by the time the dust settles. We do not know."

Ed Poll LawBizPoll@aol.com Los Angeles

The horse is already out of the barn. Mdp is already here. It is seen in many forms. But, basically, lawyers especially but not exclusively solo and small-firm practitioners are

aligning themselves with other profes sionals to make a unified network of services for the benefit of the client.

Some call it a referral network. Others call it something else. But the

process is already in place. The only issue really is whether the process can be formalized and the fees for mally shared.

ABA JOURNAL / DECEMBER 1999 77

This content downloaded from 188.72.126.88 on Wed, 18 Jun 2014 15:11:49 PMAll use subject to JSTOR Terms and Conditions