Is Your Firm Considering An “Of Counsel” Relationship?

According to Wikipedia an “Of Counsel” in the legal profession of the United States is the title of an attorney who has a relationship with a law firm or an organization, but is not an associate or a partner. Some firms use titles such as “counsel”, “special counsel”, and “senior counsel” for the same concept. According to the American Bar Association Formal Opinion 90-357, the term “of counsel” is to describe a “close, personal, continuous, and regular relationship” between the firm and counsel lawyer. In large law firms, the title generally denotes a lawyer with the experience of a partner, but who does not carry the same workload or business development responsibility.

The general rule is the “of counsel” lawyer is responsible for his own malpractice, but is not vicariously liable for the “firm’s malpractice”. As a result the “of counsel” needs his or her own insurance policy to cover his or her independent acts. The firm is liable for its malpractice and the firm’s partners are vicariously liable for the malpractice of an “of counsel” lawyer acting within the actual or apparent scope of the firm’s practice and for the firm. As a result the “of counsel” should be added to the firm’s malpractice insurance policy, but only for the acts that the “of counsel” performs for “the firm”.

A firm considering forming an “of counsel” relationship with another lawyer should:

  1. Use a written “of counsel” agreement which outlines duties, benefits, compensation, use of the office and use of the office letterhead.
  2. Review your malpractice insurance. Make sure the “of counsel” lawyer is added to the law firm’s malpractice policy to cover acts performed for the firm. The “of counsel” lawyer should be required to maintain his or her own malpractice policy, for the acts performed on behalf of the “of counsel” attorneys own separate practice.
  3. Monitor the relationship to make sure both the “of counsel” lawyer and the firm are implementing the agreement. To avoid a malpractice “surprise” the review should focus on preventing acts that may indicate that the “of counsel” lawyer is acting within the actual or apparent scope of the firm’s practice beyond what has been agreed to by the parties.