CHAPTER 20 ETHICS ISSUES IN MINERAL TITLE EXAMINATION - AREAS OF MALPRACTICE

• Jurisdiction: United States

Mineral Title Examination
(Feb 2012)
CHAPTER 20
ETHICS ISSUES IN MINERAL TITLE EXAMINATION - AREAS OF MALPRACTICE
Tony L. Atterbury
Depew Gillen Rathbun & McInteer, LC
Wichita, Kansas

TONY L. ATTERBURY is a partner at the firm of Depew Gillen Rathbun & McInteer LC in Wichita, Kansas. He concentrates his areas of practice in environmental law, administrative law, oil and gas litigation, and oil and gas law, particularly in the area of title examination. Mr. Atterbury regularly represents oil and gas producers in nearly every aspect of exploring for, producing, and selling oil and gas, including representing operators in both federal and state court litigation from lawsuits arising out of the SemCrude bankruptcy. He received his B.S. degree in chemistry from Friends University in 1998 and Juris Doctor (magna cum laude) from Washburn University in 2001 with certification in environmental law. He currently serves on the Federal Bench-Bar Committee for the District of Kansas. Mr. Atterbury is a member of the Kansas Independent Oil and Gas Association (KIOGA), the KBA Oil, Gas and Mineral Law Section, currently serves as Vice President of the Wichita Association of Petroleum Landmen, and is a frequent presenter and author on environmental law and oil and gas law, including co-author of the chapter on oil and gas law in the Kansas Annual Survey of Law.

Multijurisdictional Practice of Law and the Mineral Law Attorney

By Tony L. Atterbury

Assisted by Nathan R. Hoffman

Depew Gillen Rathbun & McInteer, LC

8301 E. 21st St. R, Suite 450, Wichita, KS 67206

316.262.4000

tony@depewgillen.com

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Introduction

Corresponding with the needs of the business world, the practice of law has transformed in such a nature that transactional and litigation matters often cross state boundaries. However, by following his or her business clients, an unwary lawyer may unknowingly engage in the unauthorized practice of law. The assumption that a lawyer can turn to the ABA Model Rules of Professional Conduct (MRPC) to evaluate the ins and outs of multijurisdictional practice (MJP) is clearly unfounded, given the variations adopted by host jurisdictions. A prudent lawyer must know the rules of each host jurisdiction in which the lawyer will engage in the practice of law to avoid engaging in the unauthorized practice of law.

I. Standards Applicable to MJP of Law

MRPC 5.5 (Old" >MRPC 5.5 (Old Version)

A lawyer shall not: (a) practice law in a jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction; or (b) assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized practice of law.

NOTES:

1. This rule leaves the precise contours of the unauthorized practice of law (UPL) regulation to a host state's law. In turn, the lawyer is required to review the statutes, court rules, case law, and any other body of law to understand the state's jurisprudence on UPL.

2. Old MRPC 5.5 is quite strict on its face. However, several exceptions are commonly recognized, including affiliation with local counsel and pro hac vice admission for limited purposes in connection with particular pending litigation.

MRPC 5.5 (New" >MRPC 5.5 (New Version)

(a) A lawyer shall not practice law in a jurisdiction in violation of the regulation of the legal profession in that jurisdiction, or assist another in doing so.

(b) A lawyer who is not admitted to practice in this jurisdiction shall not:

(1) except as authorized by these Rules or other law, establish an office or other systematic and continuous presence in this jurisdiction for the practice of law; or

(2) hold out to the public or otherwise represent that the lawyer is admitted to practice law in this jurisdiction.

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(c) A lawyer admitted in another United States jurisdiction, and not disbarred or suspended from practice in any jurisdiction, may provide legal services on a temporary basis in this jurisdiction that:

(1) are undertaken in association with a lawyer who is admitted to practice in this jurisdiction and who actively participates in the matter;

(2) are in or reasonably related to a pending or potential proceeding before a tribunal in this or another jurisdiction, if the lawyer, or a person the lawyer is assisting, is authorized by law or order to appear in such proceeding or reasonably expects to be so authorized;

(3) are in or reasonably related to a pending or potential arbitration, mediation, or other alternative dispute resolution proceeding in this or another jurisdiction, if the services arise out of or are reasonably related to the lawyer's practice in a jurisdiction in which the lawyer is admitted to practice and are not services for which the forum requires pro hac vice admission; or

(4) are not within paragraphs (c)(2) or (c)(3) and arise out of or are reasonably related to the lawyer's practice in a jurisdiction in which the lawyer is admitted to practice.

(d) A lawyer admitted in another United States jurisdiction, and not disbarred or suspended from practice in any jurisdiction, may provide legal services in this jurisdiction that:

(1) are provided to the lawyer's employer or its organizational affiliates and are not services for which the forum requires pro hac vice admission; or

(2) are services that the lawyer is authorized to provide by federal law or other law of this jurisdiction.

NOTES:

1. New Model Rule 5.5(a) amends old Model Rule 5.5 in form only. The basic provision remains the same. Subsection (a) prohibits a lawyer from engaging in the practice of law in a jurisdiction where doing so violates the professional conduct rules in that jurisdiction, and makes clear that a lawyer may not assist a lawyer or non-lawyer in the unauthorized practice of law.

2. Key difference between new rule and old rule: Six exceptions

a. First four are temporary exceptions

i. Out-of-state lawyer associates with an attorney licensed in the jurisdiction.

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ii. Lawyer's services are "reasonably related" to pending or potential litigation which the lawyer is or will be authorized to participate.

iii. Reasonably related to a pending or potential arbitration, mediation, or other alternative dispute resolution proceeding in the host state or another state, if the services arise out of or are reasonably related to the lawyer's home state and are not services for which the forum requires pro hac vice admission.

iv. Services arise out of or are reasonably related to the lawyer's practice in the lawyer's home state.

b. Last two are permanent exceptions

i. Services are provided to lawyer's employer or organizational affiliates (i.e. in house counsel).

ii. Federal law permits it.

II. State Law MJP Rule Adoption

1. Unlike most Model Rules, states are far more hesitant to adopt MRPC 5.5 in its entirety

a. A chart of state-by-state adoption is provided at http://www.americanbar.org/content/danVaba/migrated/cpr/mjp/quick_guide_5_5.pdf

b. The ABA provides a host of resources on the Commission of Multijurisdictional Practice webpage. http://www.americanbar.org/groups/professional_responsibility/committees_com_missions/commission_on_multijurisditional_practice.html

c. Last count by the ABA indicates 13 jurisdictions have adopted an identical rule to 5.5 and 31 jurisdictions have adopted a similar rule.

2. Common variances

a. Modification of the terms "systematic and continuous" and "temporary" with terms such as occasional, regular, repetitive, etc.

b. Attempting to quantify the amount of admissions in regard to pro hac vice admissions or ADR administrations.

c. Omitting the comments.

NOTE: BEFORE ENGAGING IN THE PRACTICE OF LAW, AS IT MAY RELATE TO ANOTHER JURISDICTION, YOU MUST EXAMINE THE RULES OF THE HOST STATE. LOOKING AT THE MODEL RULE WILL NOT SUFFICE.

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III. What is the "Practice of Law"?

.MRPC 5.5,Cmt" >MRPC 5.5,Cmt 2

The definition of the practice of law is established by law and varies from one jurisdiction to another.

NOTE: The model rule provides no clarity on the definition of the practice of law. Unfortunately, this means that you must research the law of the host jurisdiction to understand how the practice of law is defined.

1. Rarita v. McCarney, 391 N.W.2d 161 (N.D. 1986) - An out-of-state lawyer who is not authorized to practice law in the state sits in the same position as a suspended attorney previously admitted to practice law in the state. Such a person cannot lawfully practice law in the state, nor can that person charge a fee for such services. An out-of-state attorney who is not licensed to practice law in the state cannot recover compensation for services rendered in North Dakota.

2. Birbrower, Montalbano, Condon & Frank v. Superior Court, 949 P.2d 1 (Cal. 1998) - The California Supreme Court held that law practice was defined as "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." This included, according to the court, "legal advice and legal instrument and contract preparation, whether or not these subjects were rendered in the course of litigation." The court did not require physical presence in the state but indicated that physical presence would be a factor to consider. For example, the court noted that "advising a California client on California law in connection with a California legal dispute by telephone, fax, computer, or other modern technological means" would suffice to establish the contact with California needed to satisfy the "in California" requirement of the unauthorized practice of law (UPL) statute. Conversely, the court found, the UPL statute would not apply to the services the New York lawyers rendered entirely in New York, even though the services constituted legal advice to...