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Law firms seeking partners

Should lawyers be able to partner with other professionals such as accountants, engineers, human resources people, real estate agents and investment advisers?

Your reaction to that question might be, "Sure, why not?" but the fact is that under a 72-year-old rule, lawyers can only share fees, make management decisions and otherwise form partnerships with other lawyers.

In retail terms, it's as though law firms are required to operate like mom 'n' pop grocery stores when their competitors have long since converted to supermarkets and big-box department stores where customers can do all their shopping in one place.

And that's what most — but not all — of Utah's lawyers want to do: offer their clients more than just legal services. They are going to petition the Utah Supreme Court to change the rule and make it happen.

It's called "multidisciplinary practice," or MDP, a term that Utah State Bar (USB) president David Nuffer admits is a bit clumsy, but they're stuck with it.

The proposal to allow MDPs has been under study by a USB task force which last month came out with a 21-page study that recommends it be adopted. A final decision on going forward will be made late next month. If it's a go, the USB will file a petition with the state Supreme Court to make the rule change that will open the door to law firm MDPs.

Several other states, mostly in the West, are also studying the issue, but Nuffer says Utah is in the vanguard in that it has developed a report and a set of rules that would govern the conduct of MDPs. The American Bar Association proposed MDPs 18 months ago, but the ABA's House of Delegates killed it.

Why? Nuffer says some lawyers, including some in Utah, want things to stay as they are, believing MDPs will somehow dilute the status of the legal profession. They worry about sharing decision-making with non-lawyers.

"We (the Utah State Bar) have decided that's not a problem," said Nuffer.

The upside, as the proponents see it, is that MDPsoffer clients "one-stop shopping" for a variety of business and professional services from a single point, reducing costs and coordinating services. It also would offer Utahns quicker and easier access to legal services, since advertising rules would be relaxed, allowing lawyers to more readily reach potential clients.

It would also create greater Internet access and broader, more cost-effective legal services and enhanced protections for consumers, since the more stringent standards that rule the conduct of lawyers would then be applied to other professions. Some Internet sites are now offering legal advice.

MDPs are not new, said Nuffer, who is an owner of the St. George law firm Snow Nuffer. Current prohibitions on lawyers entering into partnerships with non-lawyers or dividing fees for legal services with anyone other than another lawyer were adopted in 1928.

Now, driven by technology and increasing competition — from financial services companies, mutual funds, banks and insurance companies, among others — many lawyers are seeing the need to broaden the "lawyers only" concept and offer clients one-stop shopping for a variety of legal and financial services.

Law firms have always used outsiders to provide expertise in other disciplines, of course. Nuffer's firm does a lot of subdivision work and has to call in outsiders.

"People come to us for a land problem and get a lot of non-legal advice, and they go to engineers and get a lot of legal advice. We foresee this change having a big impact on the ability of people to get a variety of services under one roof."

Law firms can hire outside people now, of course, but they are just that: employees. Under an MDP, non-lawyer professionals could be brought in as owners. This, believes Nuffer and the bar commission that has studied the issue, would allow law firms to bring a "higher level" of people into the firm.

Will the Supreme Court go along with the change? Nuffer is upbeat: "I believe it will be adopted and the new rules be in place by next summer."


E-MAIL: max@desnews.com