Bringing MDP up to date.

• Author: Mitchell, George H.

SHALL we MDP, or shall we not MDP?

That's one of the current hot-button issues for the legal profession in the United States, as well as in the common law countries of England and Australia. MDP stands for multidisciplinary practice (or partnership), and how the United States resolves its position will greatly influence the course in the other nations.

What is it?

An MDP is an organization in which both lawyers and non-lawyers have a proprietary interest as a partner (in the more traditional form) or as a shareholder in the limited liability partnership or corporation form now widely used. Such an organization is not permitted in the United States, where the states have adopted a form of Rule 5.4 of the American Bar Association's Model Rules of Professional Conduct, which prohibits lawyers from forming partnerships with non-lawyers if any of the activities of the partnership consist of the practice of law.

Since the accounting profession has no similar prohibition, accounting firms, especially those known as the Big Five, have taken hundreds of lawyers into their organizations, many with ownership status. Thus, those firms are able to offer a wider range of services to clients under "one roof."

IADC committee created

In view of these developments, the American Bar Association in 1998 appointed a commission to study whether the legal profession should relax its prohibitions. Because the authorization of MDPs is an important issue for IADC members, the IADC executive Committee created an ad hoc committee to follow the MDP developments and to advise the Executive Committee. Joan Fullam Irick heads that committee. Richard Campbell presented a non-positional statement on behalf of IADC to the ABA commission in the summer of 1999. (See "Multidisciplinary Practice: Is It the Wave of the Future, or Only a Ripple?" Defense Counsel Journal, October 1999, page 460.)

In the article in the October 1999 issue of the Journal, IADC member John Evans of London discussed the developments in England, where a working group of the Law Society has studied how MDPs might be structured to enable solicitors to offer services on a competitive level with the ever-widening thrust of the large accounting firms, and IADC member Stuart Clark of Sydney described the legislation in New South Wales under which lawyer-controlled MDPs are permitted.

Commission reports

In 1999, the ABA commission presented a complex recommendation under which lawyers would be able to...