Bar Association says no to fee-sharing concept

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The American Bar Association House of Delegates rejected the concept of multidisciplinary practice by a resounding vote of 314 to 106 in July, As a result, lawyers will not be able to share fees or firm ownership with non-lawyer professionals such as accountants and financial advisers.|ret||ret||tab|

Mike Cully, an attorney with Lowther Johnson Joyner Lowther Cully & Housely PC, served as a member of the Missouri Bar's committee on multidisciplinary practices (MDPs). The purpose of the committee was to decide if MDPs should be allowed in Missouri. |ret||ret||tab|

"The committee hired a consultant from the University of Missouri-Columbia to assist us," Cully said. "He was hired to do sampling techniques to see what people perceive to be the pros and cons of the issue. He identified the arguments that were raised for and against MDPs. We conducted focus groups throughout the state which consisted of lawyers and non-lawyers."|ret||ret||tab|

The discussion of whether multidisci-plinary practice should be allowed began two years ago.|ret||ret||tab|

"In 1998, the president of the American Bar Association decided to study the issue," Cully said. "In August of 1999, a committee of delegates unanimously recommended revision of the ethical rules to permit fee-sharing with non-lawyers. But the House of Delegates tabled it pending further study." |ret||ret||tab|

The ABA House of Delegates' final determination on the issue came during the association's annual meeting in July.|ret||ret||tab|

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Reaction|ret||ret||tab|

Cully said the feedback he is getting from members of the Missouri and Springfield Metropolitan Bar associations is overwhelmingly supportive of the decision. |ret||ret||tab|

He added that he doesn't think MDPs are in the best interest of the client.|ret||ret||tab|

"Some say a definite benefit of an MDP is one-stop shopping," he said. "But is the convenience worth it? There are serious conflicts of interest when lawyers share their fees with non-lawyers."|ret||ret||tab|

Bill Hart, an attorney for Husch & Eppenberger LLC, said he thinks the delegates' decision was short-sighted.|ret||ret||tab|

"I think it's something the bar and the bar association should endorse; it's the international trend," he said. "Experience has shown that in other countries, the best way to provide service is to combine the full range of services a client needs by going beyond just what a lawyer can provide."|ret||ret||tab|

Wayne Hlavacek, a CPA and principal with the accounting firm of Hlavacek, Morris and McIntyre, agreed.|ret||ret||tab|

"Bigger accounting firms are providing investment and consulting services to expand their normal services," Hlavacek said. "A normal extension of that would be to add legal services as well to provide one-stop shopping. I think it would be a good thing to have everything under one roof. That would also put CPA firms on equal footing with the bigger financial institutions that are expanding into accounting and tax-related areas of service."|ret||ret||tab|

However, Cully said he thinks it would be hard to protect attorney/client privilege with a multidisciplinary practice. |ret||ret||tab|

"Other professions may not have the confidentiality requirements that attorneys have," he said. |ret||ret||tab|

Also, "the attorney interfaces with expert witnesses, accountants and others on behalf of the client. So I don't see the argument of it being convenient' as persuasive," Cully said. |ret||ret||tab|

He added that he believes there's also a problem with attorneys and accountants working together as it relates to the accountant's function as an auditor.|ret||ret||tab|

"The accountant is to make full disclosure of the factors that affect a company financially to let them know if they should invest in a company or not," he said. "The attorney's role is to advocate for the client and preserve the secrets of the client."|ret||ret||tab|

Despite the ABA's action, both Hart and Hlavacek expect the legal profession's stance on MDP will change with time.|ret||ret||tab|

"I think that at some point, the bar association will recognize the need for (MDPs)," Hart said. "I have clients who need what a lawyer, a financial adviser and an accountant can do. It's inefficient to have to go to three different offices to deal with each of those people." |ret||ret||tab|

Hlavacek agreed, but added that, for now, "the ABA is opposed to attorneys who aren't CPAs becoming principals in a CPA firm where fees for legal services could be shared with non-attorneys." |ret||ret||tab|

"The ABA wants a clear distinction between attorneys and every other profession." |ret||ret||tab|

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