In an action that could affect large numbers of New Jersey practitioners, two court regulatory committees said on Friday that "virtual offices" staffed by receptionists who are mere answering services do not satisfy New Jersey's bona fide office rule.
Virtual offices, time shares in an office building on an hourly or daily basis, are popular with lawyers who work from their homes but need someone to take their calls and a conference room to meet clients.
But these lawyers are violating Rule 1:21-1(a), the Advisory Committee on Professional Ethics and the Committee on Attorney Advertising said in a joint opinion, ACPE 718/CAA 41.
The rule defines a bona fide office as a place where an attorney or a responsible person acting on the attorney's behalf can be reached in person and by telephone during normal business hours to answer questions posed by courts, clients or adversaries.
By contrast, "an attorney's use of a virtual office is by appointment only. The office building ordinarily has a receptionist with a list of all lessees who directs visitors to the appropriate room at the appointed time," the opinions say. "Depending on the terms of the lease, the receptionist may also receive and forward mail addressed to lessees or receive and forward telephone calls to lessees."
"A 'virtual office' cannot be a bona fide office since the attorney generally is not present during normal business hours but will only be present when he or she has reserved the space," the opinions say. "Moreover, the receptionist at a 'virtual office' does not qualify as a responsible person acting on the attorney's behalf who can answer questions posed by the courts, clients or adversaries."
Yes, virtual-office receptionists can notify the attorney lessee, much like an answering service, but they wouldn't be able to speak about legal matters the attorney is handling, the opinions say.
The opinions are likely to reinforce New Jersey's reputation among attorney regulators around the country as a state that bends its ethics rules slowly to the inchoate winds of social and economic change. Most states, for example, have abandoned the bona fide office rule.
The rule arose decades ago, partly to keep out-of-state practitioners at bay and partly to put a stop to lawyers who ran their businesses out of saloons, social clubs and pay-phone booths.
Lawyers must have an office where confidential information can be kept securely, where face-to-face discussions with clients are private and where someone can make sure the attorney is "reachable by telephone or e-mail during the occasional absences," the rule says.
The opinions also say:
• Lawyers who have bona fide offices can also have virtual offices, but letterheads, Web sites and ads must identify the virtual offices as such and say the location is "by appointment only."
• Lawyers who have their own offices and are also of counsel to another firm must disclose the "of counsel" relationship if listing the other firm's address.
• If a firm allows an outside lawyer to use a conference room occasionally, the lawyer can't list the firm's address as an office.
• Lawyers can share space with nonlawyers but the offices must be separate and the lawyer can't be embedded in the nonlawyer's operation.
• Home offices are ethical, as long as steps are taken to keep the business of the clients separate and confidential and as long as the attorney can be found there and clients could be met there.
An attorney in central New Jersey, who rents space that the opinion defines as a virtual office, says the stricture would affect a large number of lawyers who can't afford full-time staffs or pay rent for office space.
The lawyer, who did not want to be identified, says it seems illogical to outlaw an arrangement in which lawyers keep confidential material secure at home, but use the address of a short-term rental space and are accessible 24 hours a day through a shared receptionist.
"I can get a message within minutes, while the typical lawyer who works at home exclusively has an answering machine and can be out of touch for hours," the lawyer says.
Carolyn Elefant, a Washington, D.C., practitioner whose blog at MyShingle.com is a popular site for solos, says a rule against convenience offices is troubling because a lot of practitioners do not want to use their home address for security and privacy reasons, particularly if they have small children. She works at home but uses a virtual office as her mailing address and phone calls are routed directly to her cell phone so she is in touch with clients immediately.
Elefant, who lectures to bar groups on e-law topics, says New Jersey is one of the few states to maintain a bona fide office rule.
Richard Granat, who has a firm in Owings Mills, Md., and is co-chairman of the American Bar Association's E-Law Task Force, is among a group of lawyers around the country who advocate virtual practice in which clients communicate with lawyers armed with laptops, smart phones, cell phones and other electronic gizmos and who keep files on secure private networks.
Granat said on Friday, "The only people these rulings help are people who rent fancy offices to lawyers."
The opinions acknowledge that modern communications make lawyers more accessible outside their offices.
But ethics panel chairman Steven Mannion says the committee had to interpret the rule as it exists. "The ACPE is not in a position to rewrite the Court rules," says Mannion, of DeCotiis FitzPatrick & Cole in Teaneck, N.J.
He also says the committees' opinions that lawyers must disclose that timeshare offices are "by appointment only" serve as a reminder that attorney advertising must be truthful.
He says any lawyer who disagrees with the opinions has the right to ask the state Supreme Court for a review.