Proposed 2025 Formal Ethics Opinion 1- Obligations Related to Notice When the Lawyer Leaves a Firm

Available at:   https://www.ncbar.gov/for-lawyers/ethics/proposed-opinions/

Summary:

Should this FEO be adopted,  these are the steps that must be taken so that affected clients are adequately notified when a lawyer departs a law firm.

• Determine which  clients are affected:  This could include those:
  • With whom the departing lawyer has an ongoing professional relationship;
    • This would not in most circumstances seem to include clients in cases that have completed,  received a discharge,  been dismissed,  or closed.
  • For whose legal matters the lawyer was responsible at the time of departure;
  • With whom the lawyer had significant client contact or provided substantial legal services.  
• Notice must be sent to the client informing them:
  • That the lawyer is leaving and where they are going (if known); 
  • That they have the right to choose their counsel;
  • Of their three main options: 
    • stay with the current firm,
    • go with the departing lawyer, or 
    • select new counsel.
  • The current case status;
  • An accounting of any client property held in trust;
  • Any responsibility for fees/costs already incurred;
  • The deadline by which the client must elect representation;
  • Instructions for file and fund transfer (with client consent); and 
  • Any necessary details about new fee agreements or changes in billing if choosing the departing lawyer.

Commentary:

This FEO  only addresses the ethical requirements that the NC State Bar places on lawyers when one leaves a law firm.  As usual,  it is not exactly congruent with actual consumer bankruptcy representation,  particularly for larger multi-attorney consumer debtor firms (such as my own)  where there often are several "primary  attorneys"  involved in various aspects of a case  or for law practices that represent mortgage  servicers or other creditors.  

It would certainly be helpful,  especially as I have directly been recently involved in both circumstances where an attorney left my firm and also cases where a lawyer for a large mortgage servicer departed,  if there was clearer,  supplemental guidance in the Local Rules for the three districts in North Carolina,  about when   and how departures and substitutions of counsel should be handled.

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