Every year, Arkansas attorneys who renew their law licenses are required by Arkansas Rule of Professional Conduct 1.15 to certify their compliance with court rules governing client trust accounts. In 2016, the Arkansas Supreme Court adopted rules that address how attorneys who handle client funds are supposed to deal with account balances that have gone unclaimed by a client entitled to the funds or that the attorney cannot trace to a rightful owner. Those rules require an attorney to remit unclaimed or unidentifiable funds to the Arkansas Access to Justice Foundation if, after a period of two years, the attorney is unable to identify or locate the person entitled to such funds.
Beginning with this year’s IOLTA Compliance Statement, attorneys who handle client funds are required to certify that they have made a determination as to whether any of the client funds they manage include any unclaimed or unidentifiable funds. This certification is can be made by returning a hard copy of a completed, signed IOLTA Compliance Statement with the attorneys license fee payment, or by completing the required certification online.
The deadline for completing the IOLTA Compliance Statement for 2018 is March 1, 2018.
In an opinion handed down December 14, the Arkansas Supreme Court adopted the final round of rule changes that clarify the obligations under the Rules of Professional Conduct and Rules of Civil Procedure of attorneys who provide unbundled legal services. Also known as “limited scope representation” or “a la carte legal services,” unbundling allows for a client to hire an attorney to help with some, but not all, of that client’s legal matter. Such representation can include legal advice, document preparation, document review, or limited appearances on behalf of the client.
The opinion includes changes to Rules 11 and 64 of the Arkansas Rules of Civil Procedure, and adds a new Rule 87. These changes explicitly authorize ghostwriting, lay out a process by which an attorney attorney offering unbundled services can put a court on notice of the extent of representation, and provides for termination of representation without leave of the court upon the filing of a notice of completion of the matter.
The rules, as adopted, substantially track the original proposal of the Arkansas Supreme Court Committee on Civil Practice. The only substantive change made is that attorneys who ghostwrite pleadings must disclose their identity in a notation at the end of the document, rather than simply indicating that it was prepared with the assistance of an Arkansas-licensed attorney pursuant to Arkansas Rule of Professional Conduct 1.2(c).
Interested in learning more about these rule changes? Join us for a webinar entitled “How to Ethically Unbundle Your Practice” on January 24, 2018 at noon. We’ll cover these rule changes, the Rules of Professional Conduct that authorize unbundling, and more! Sign up here.
Every year, more than 50,000 domestic relations cases are filed in Arkansas. Nine out of every ten of these cases involves at least one person who does not have a lawyer. Similar trends can be seen in cases involving housing, wills and estates, and debt collection cases. Only about 3000 Arkansas attorneys are currently in private practice and available to even handle cases like this. Under these conditions, it would be virtually impossible for everyone with an active case who needs legal advice to actually get it.
In recent years, more and more people have turned away from lawyers and instead sought information and legal forms online. People often pay hundreds of dollars to online services that provide documents that turn out to be legally deficient. The desire for upfront, transparent pricing and for options that allow people to handle simple matters themselves is driving a new kind of legal market–one that is leaving the legal profession behind, to the detriment of consumers and our system of justice.
For these reasons, the Arkansas Access to Justice Commission, through special Task Force on Self-Represented Litigants, has spent the last four years researching rules in other states, gathering Arkansas-specific data on self-represented litigants and market trends, drafting rules, and sharing those drafts with attorneys and judges all over the state. The recommended rule changes that the Arkansas Supreme Court has released for public comment represent four years worth of work toward a solution that we believe will make legal services affordable to many people who are currently priced out of the market, will allow cases involving self-represented litigants who use limited scope legal services to get resolved more efficiently and on the merits, and will open a new market of paying clients to attorneys.
The Arkansas Supreme Court has issued a per curiam order seeking comments from the bench, bar, and public on proposed rule changes to the Arkansas Rules of Civil Procedure. Rules 11 and 64 would be modified and a new Rule 87 would be added. The Arkansas Access to Justice Commission drafted the rule changes with the goal of increasing access to justice by explicitly authorizing “unbundling” of legal services. (Read more about unbundling.) The Commission strongly encourages the public to submit comments for the Court’s consideration.
The exact text of the proposed rule changes can be found here. Below is a brief summary of the changes proposed.
Rule 11 is proposed to be changed to explicitly authorize “ghostwriting” in Arkansas. Ghostwriting is when an attorney prepares pleadings on behalf of a client, but does not represent the client beyond preparing the documents. Under the proposed changes, an attorney would not need to sign the pleadings, but would be required to include a notation stating: “This document was prepared with the assistance of a licensed Arkansas lawyer pursuant to Arkansas Rule of Professional Conduct 1.2(c).”
The proposed changes would also allow an attorney ghost writing pleadings for a client to rely on the client’s representation of facts unless the attorney has reason to believe the representation is false or materially insufficient.
The proposed changes to rule 64 are limited to adding a reference to the proposed Rule 87 and making technical corrections to make pronouns inclusive of both genders.
The addition of Rule 87 would establish procedures for how an attorney withdraws from a case when the attorney and client have agreed that the representation is limited to only part of a case, as permitted by Rule 1.2(c) of the Arkansas Rules of Professional Conduct.
The proposed changes represent a win-win-win for the public, courts, and attorneys. By clarifying the procedures for attorneys who offer unbundled legal services, more attorneys will feel comfortable offering this option to clients. Unbundled services allow a lawyer and client to agree that the lawyer will handle certain parts of the case and the client will be responsible for other parts of the case. For example, a lawyer and client might agree that the lawyer will prepare a divorce complaint for the client and advise them about how they should proceed to get their divorce decree or they might agree that the lawyer will represent the client at one hearing while the client remains responsible for the rest of the case. Existing rules require that attorneys who provide limited scope representation only when it is appropriate under the circumstances, which means that limited scope representation is usually NOT going to be an option for complicated cases or unsophisticated clients.
This has the effect of increasing access to justice because attorneys who offer unbundled services charge fees that reflect a discrete amount for a discrete aspect of the case. Such fees, though commensurate with the amount of time an attorney puts in, are typically much more affordable than full-service fees. This means that more people can afford legal representation. This not only improves the outcomes in individual cases, but also helps our courts to run more efficiently. Lawyers are also able to offer their services to people who previously wouldn’t have gone to them for help.
To submit comments on these proposed changes, mail them to the Clerk of the Arkansas Supreme Court at the following address:
Stacey Pectol, Clerk, Supreme Court of Arkansas
ATTN: Civil Procedure Rules
625 Marshall Street
Little Rock, Arkansas 72201
Comments must be made by October 6, 2017. If you have questions or would like additional information about the rules or our research, feel free to contact us.
Last month, the Arkansas Supreme Court issued an order adopting proposed changes to the Arkansas Rules of Professional Conduct that clarify the responsibilities of attorneys who offer their services to clients on a limited scope basis. Also known as “unbundled” or “a la carte” legal services, limited scope representation offers an affordable alternative to clients who cannot afford traditional full-service representation, opens up new business opportunities for lawyers, and facilitates greater efficiency in the court system. The rules went into effect on the day of the May 12 opinion.
Modification to Arkansas Rules of Professional Conduct 1.2(c), 4.2, and 4.3 provides more explicit guidance for attorneys who provide limited scope legal services. Arkansas Rule of Professional Conduct 1.2(c) authorizes Arkansas attorneys to provide this form of representation. That rule provides that “[a] lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent.” Additionally, the revisions include the addition of language regarding when a client’s informed consent has to be in writing, as well as language clarifying an attorney’s communication responsibilities when the opposing party is represented by a limited scope attorney.
Links to the revised rules can be found below, and sample Notices of Limited Scope Representation and Notice of Completion can be downloaded from the links below.
Limited Scope Representation – Attorney Resources
Arkansas Limited Scope Toolkit for Attorneys (coming soon)
Sample Notice of Limited Scope Representation – Family Law
Sample Notice of Limited Scope Representation – Other Civil
Sample Notice of Completion of Limited Scope Representation
The Commission is working toward seeking additional changes to Arkansas Rules of Civil Procedure to explicitly authorize the practice of ghostwriting and to permit attorneys who give proper notice of a limited scope arrangement in a court proceeding to be automatically relieved as counsel of record once the attorney has completed the limited scope representation. Drafts of those rules can be found here.
Resources for attorneys, including a toolkit, forms, CLE training, and a client referral network are under development and will be made available as they are developed.
The Arkansas Supreme Court has issued an order soliciting comments from the bar and public regarding proposed changes to Arkansas Rule of Professional Conduct that would provide guidance for attorneys who wish to provide limited scope representation. Also known as “unbundled” or “a la carte” legal services, limited scope representation offers an affordable alternative to clients who cannot afford traditional full-service representation, opens up new business opportunities for lawyers, and facilitates greater efficiency in the court system.
Arkansas rules already permit limited scope representation; the rules changes simply offer more clarity for lawyers who choose to engage in this form of practice. The revisions include the addition of language regarding when a client’s informed consent has to be in writing, as well as language clarifying an attorney’s communication responsibilities when the opposing party is represented by a limited scope attorney.
The order was issued in response to a petition that the Arkansas Bar Association filed requesting the changes. “It is the Petitioners’ belief that the rule changes proposed herein will equip Arkansas attorneys to adapt to new market realities posed by the DIY movement and help address the overwhelming unmet need among persons of limited and modest means,” the petition states. “As a result, members of the Arkansas public who are bypassing lawyers altogether can have meaningful access to the counsel and advice of skilled advocates at prices that are affordable and that compensate attorneys for their time and expertise.”
Comments should be submitted in writing and addressed to Stacey Pectol, Clerk of the Arkansas Supreme, Court, Attn: Code of Professional Conduct, Justice Building, 625 Marshall Street, Little Rock, Arkansas 72201. The deadline for submitting comments is May 1, 2016.
The Arkansas Supreme Court has adopted changes to Arkansas Rule of Professional Conduct 1.15 to lay out a mechanism by which attorneys or estates of deceased attorneys can deal with unclaimed or unidentifiable funds in client trust accounts. The opinion, issued November 5, also moved provisions of the rule that deal with bank compliance and interest rate comparability to an administrative order.
The new provision addresses situations where an attorney, law firm, or estate of a deceased attorney (1) winds up in possession of client or third party funds and the client or third party cannot be located, despite diligent efforts to locate the rightful owner; or (2) is in possession of funds in a client trust account that cannot be traced back to a particular client.
The Arkansas Access to Justice Foundation, which administers the IOLTA program, has updated its Guidebook for Attorneys and Financial Institutions to include guidance for compliance with the new rule and has adopted forms for attorneys to use to report and remit such funds to the Foundation and to return the funds to the rightful owner if a claim for the funds is made.
The Arkansas rule change addresses these scenarios by providing a simple process for attorneys to dispose of unclaimed and unidentifiable funds consistent with applicable ethical obligations, while generating additional revenue for the IOLTA Program of the Arkansas Access to Justice Foundation, which will use the funds to make grants supporting the provision of free civil legal aid to the poor.
The Arkansas Supreme Court has issued an order soliciting comments from the bar and public regarding proposed changes to the Arkansas Rule of Professional Conduct governing IOLTA accounts that would lay out a mechanism for addressing situations where an attorney, law firm, or estate of a deceased attorney (1) winds up in possession of client or third party funds and the client or third party cannot be located, despite diligent efforts to locate the rightful owner; or (2) is in possession of funds in a client trust account that cannot be traced back to a particular client.
In the first scenario—involving “unclaimed” trust account funds—the Arkansas Uniform Disposition of Unclaimed Property Act has historically served as the only source of guidance. Under that Act, client funds are presumed to be abandoned after seven years have passed without any contact or instructions from the property’s owner. The process for disposing client funds under this Act is often cumbersome—particularly for attorneys dealing with relatively small amounts of money—and it is inconsistent with the five-year period that attorneys are normally required to retain client records.
In the second scenario—involving “unidentifiable” trust account funds—there is no guidance whatsoever for what attorneys should do with such funds, as the Arkansas Uniform Disposition of Unclaimed Property Act contemplates that there is a known person who is the rightful owner. Some examples of situations that might result in unidentifiable funds in a trust account include:
- When a lawyer tries to reconcile an account after a number of years;
- When a lawyer who has died kept no or inadequate records and the representative of the estate is unable to determine what clients may be entitled to the remaining funds;
- When law firms merge and combine records, there may be balances that have no client identifier surviving in the records.
A number of other states have implemented or considered implementing provisions to address the problem of unclaimed or unidentified trust account funds.
The proposed Arkansas rule change addresses these scenarios by providing a simple process for attorneys to dispose of unclaimed and unidentifiable funds consistent with applicable ethical obligations, while generating additional revenue for the IOLTA Program of the Arkansas Access to Justice Foundation, which will use the funds to make grants supporting the provision of free civil legal aid to the poor. Historically low interest rates have resulted in catastrophic decreases in IOLTA revenue over the last five years, resulting in significant funding cuts for legal aid.
Comments should be submitted in writing and addressed to Stacey Pectol, Clerk of the Arkansas Supreme, Court, Attn: Rule 1.15, Justice Building, 625 Marshall Street, Little Rock, Arkansas 72201. The deadline for submitting comments is September 15, 2015.
The Arkansas Access to Justice Commission is soliciting comments from the bench, bar, and public on a set of proposed changes to select rules of civil procedure, professional conduct, and judicial conduct, as well as adoption of a new administrative order. The Arkansas Access to Justice Commission and its Self-Represented Litigant Task Force have crafted these proposed changes in an effort to implement the Commission’s plan for addressing significant growth of self-representation in Arkansas over the last decade. In developing its plan, the Commission had the benefit of a 2011 study it conducted in partnership with the Clinton School of Public Service, which indicated that as many as 95% of select civil cases have at least one unrepresented litigant. The Commission also relied on the 2013 recommendations of John Greacen, a nationally recognized expert on self-represented litigants. A 2014 Arkansas Lawyer article offers background information on the current state of access to civil justice makes the case for how limited scope representation (also known as “unbundling”) can reduce the justice gap and generate new sources of business for private attorneys.
Our proposed rule changes include the following:
- Adoption of an administrative order regarding the provision of legal information to the public by court staff, librarians, and others who have specialized knowledge of the court system or legal resources;
- Modification of Rule 2.2 of the Judicial Code of Conduct to provide more explicit guidance on the types of accommodations judges may make to facilitate the ability of all litigants, including self-represented litigants, to be fairly heard;
- Modification of Ark. R. Civ. P. 11 and Ark. R. Prof’l Conduct 1.2, 4.2, and 4.3, to provide more explicit guidance for attorneys who provide limited scope legal services;
- Adoption of a new Ark. R. Civ. P. 87, which provides for automatic termination of a limited scope engagement upon notice to the court and opposing counsel of the matter’s completion.
Other states that have successfully implemented similar rules and guidelines have found that judges and court staff are able to do their jobs more effectively when they are not burdened with deficient pleadings and unprepared litigants, that court clerks are able to successfully avoid ethical dilemmas when assisting pro se litigants, that private attorneys are able to more easily represent their clients when opposing self-represented litigants have the proper information and guidance, and that private attorneys may develop new sources of business from a previously unprofitable market of clients by providing limited scope representation. These recommendations are modeled in significant part on similar rules and policies from Alabama and Colorado.
The Commission is currently soliciting input from major stakeholders in the coming months, and our goal is to finalize the proposed rules to submit as a petition to the Arkansas Supreme Court in early 2016.
You may direct any comments, questions, or concerns to Amy Dunn Johnson, Executive Director, Arkansas Access to Justice Commission, 1300 West 6th Street, Room 110, Little Rock, AR 72201, (501) 492-7172.
The Arkansas Supreme Court has announced the appointments of Justice Robin Wynne and Circuit Judge Robert McCallum to the Arkansas Access to Justice Commission. Justice Wynne succeeds retired Arkansas Supreme Court Justice Annabelle Tuck, and Judge McCallum succeeds Judge Leon Jamison. We are grateful for the tremendous contributions that our outgoing commissioners have made to our efforts to improve access to the civil justice system for all Arkansans.