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Malpractice insurer gives bad advice about working with freelance lawyers

I recently came across a risk management guide to working with freelance lawyers (a/k/a contact attorneys), published by Lawyers Mutual Liability Insurance Company of North Carolina. While I would generally expect a guide published by a malpractice insurer to give solid—even conservative—risk management advice, I found just the opposite in this guide.

The guide touts working with freelance lawyers as a good option for firms that want to perform work that’s outside their practice area(s):

Contract attorneys are especially beneficial for a law practice that is seeking a subject matter expert. Whether you are a solo practitioner or a member of a large firm, it is always possible to encounter an issue outside of your expertise. Contract attorneys can provide that subject matter knowledge, fulfilling a specific role for a specific case. Instead of billing the client or writing down time to research an unfamiliar area of law, enlisting an attorney who is already well-versed in that subject can better serve the needs of the client and the firm.

Use of a subject matter expert contract attorney can be a tool to expand a law firm’s areas of practice. By hiring a contract attorney with special expertise, existing attorneys have the opportunity to learn from the contractor and develop new skills and experience. Even if the firm does not permanently hire the contract attorney, it may still reap a long-lasting benefit from the broadened expertise of its legal staff.

This dangerous advice is liable to land any attorney who follows it in hot water. ABA Formal Op. 08-451 explains that Model Rule 1.1 requires a lawyer to render legal services with the “legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.”

In determining whether a lawyer employs the requisite knowledge and skill in a particular matter, relevant factors include the relative complexity and specialized nature of the matter, the lawyer’s general experience, the lawyer’s training and experience in the field in question, the preparation and study the lawyer is able to give to the matter and whether it is feasible to refer the matter to, or associate or consult with, a lawyer of established competence in the field in question.

ABA Model Rule 1.1, Comment 1. The opinion observes that “[t]he challenge for an outsourcing lawyer…is to ensure that tasks are delegated to individuals who are competent to perform them, and then to oversee the execution of the project adequately and appropriately.” A hiring lawyer who outsources a matter in a practice area in which the hiring lawyer is not competent to practice cannot satisfy the requirement that the lawyer “oversee the project adequately and appropriately.”

This doesn’t mean that a firm that wants to represent a client on a matter that is outside the firm’s practice areas is out of luck: if a matter comes in that’s outside your area of expertise, you can still ethically handle the case by bringing in a knowledgeable lawyer as co-counsel. In a co-counsel relationship, the client has a direct attorney-client relationship with both attorneys; in an outsourcing relationship, by contrast, the client does not have a direct attorney-client relationship with the freelance attorney. It follows that, because co-counsel has an attorney-client relationship with the client, the attorney you co-counsel with must be admitted to practice in your jurisdiction (if not as a member of your jurisdiction’s bar, at least on a pro hac vice basis); by contrast, in an outsourcing relationship, the freelance attorney need not be admitted in your jurisdiction.

Comments (2)

  1. Reply Chris Osborn

    Hmmm… With all due respect, I think this post might be a little bit overly critical here. Lawyers Mutual Liability of North Carolina’s guidance doesn’t specify or limit the capacity in which the contract lawyer might be involved. In fact, I’m not sure that the Lawyers Mutual guide ever uses the word “outsourcing,” which of course has a very different connotation, in discussing the potential value of engaging a contract lawyer. And is there anything that would prohibit a contract or freelance lawyer to be from being engaged in a “co-counsel” role where necessary or advantageous? I can understand wanting to offer a thoughtful note of caution on this subject, but I’m having a hard time seeing Lawyers Mutual’s commentary as “dangerous.” (In the interest of full disclosure, I am both a Lawyers Mutual policyholder and frequent CLE speaker for its “Put Into Practice” series.)

  2. Reply Lisa Solomon

    Thanks for your comment. The roles of freelance (a/k/a contract) lawyer and co-counsel are mutually exclusive: freelance lawyers do not have a direct attorney-client relationship with the client, whereas in a co-counsel relationship, each lawyer has an attorney-client relationship with the client. Hiring lawyers are ethically obligated appropriately supervise work performed by freelance lawyers; a lawyer is not ethically obligated to supervise the work of co-counsel. Therefore, by encouraging lawyers to use contract attorneys to provide services in areas in which the lawyer has no experience, Lawyers Mutual is encouraging outsourcing.

    Certainly, a lawyer who sometimes works as a freelance lawyer could agree to come on, instead, as co-counsel if the situation warrants it.

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