Saying Your Goodbyes—Ethical Obligations When Transitioning to a New Firm

November 21, 2024

Attorney mobility between law firms is common in today's marketplace. The old trend of a lawyer staying at a firm for over a decade-or even for their entire career-is less common. Although attorneys more routinely move among firms, there can still be some risk.

Knowing what is expected when a transition is made can assist making such separations amicable between departing attorney and the prior firm. Below are some tips to consider to help ethically navigate these partings with professional grace and to avoid disputes where possible.

The Client's Freedom of Choice

Most jurisdictions, including California, have upheld that a leaving attorney may notify clients of his or her move to another law firm. California Rule of Professional Conduct 1.4 treats an attorney's departure as a "significant development." Thus, the firm and the leaving attorney have simultaneous obligations to inform the client "as soon as reasonably practical" to allow the client to make an informed choice in counsel. Cal. Bar Formal Op. Interim No. 13-0003 at 4 (quoting Cal. RPC 1.4(a)(3)).

At the outset, such notification should take place only after the lawyer first gives notice to the firm of the departure. Cal. RPC 1.3 demands lawyers act with reasonable diligence and promptness when representing a client. Such diligence and promptness, as the ABA has explained, includes the lawyer's obligations to "promptly notify a client if a lawyer is changing law firm affiliations." See ABA Op. 19-489.

Transitioning attorneys and their prior law firms can run into disputes where the leaving attorney solicited the firm's clients to follow the departing attorney to a new firm. The ethical rules vary in each jurisdiction regarding what amount of contact with a client is permissible during such departures. But most jurisdictions recognize that the client's choice of its counsel is paramount during these transitions.

In California, for example, a departing lawyer is "ethically permitted to solicit those clients [with whom the lawyer had a prior professional relationship] in accordance with California's Rules of Professional Conduct and related statutes governing solicitation." See Cal. Bar Formal Op. Interim No. 13-0003 (citing Ca. RPC 7.1-7.3). However, discussing the departure with associate(s), clients, and others poses some risk of being deemed an improper solicitation. Unless an agreement is reached with the law firm for an early date, the attorney should not solicit clients until after he or she actually departs from the law firm.

Ultimately, the client determines who will represent them moving forward. Timely and proper notification of the lawyer's departure is important to ensure the client is able to make that determination.

Partnership or Employment Agreements

When deciding how and when to notify the client, in addition to the specific ethical rules that apply, the departing attorney should first consult their partnership or employment agreement, as such agreements often address the timing and manner of notification to clients and others.

It may be helpful to speak with the law firm regarding an agreed upon or recommended approach in notifying the client of the departure; for example, a joint or collaborative notification to the client could be feasible or even required by firm policy or agreement.

A joint communication may not always be practicable, though. Regardless of how the communication is made, the departing lawyer and the law firm should avoid disparaging, or giving misleading statements about, the other party to the client during the separation.

The ethical rules generally do not allow for noncompetition clauses in partnership, member or shareholder agreements. Thus, a lawyer who is leaving a firm may not have their right to practice law restricted by the firm's policies, unless authorized by law. Under Ca. RPC 5.6, "a lawyer shall not participate in offering or making a partnership, shareholder, operating, employment, or other similar type of agreement that restricts the right of a lawyer to practice after termination of the relationship."

In navigating the separation, the departing partner or associate should consult with the agreement to ensure compliance with any applicable provisions, such as requirements for the return of technology or of client files. Moreover, under certain circumstances, the departing attorney may wish to consult with independent counsel to ensure compliance with the agreement and to be aware of all ethical obligations.

Ensuring Smooth Transitions

The partner or associate should work with the law firm they are leaving to ensure a reasonable period of time for transition, to assist in the orderly transition of client files, and to return firm property.

The duty of confidentiality generally requires attorneys to return client files and any firm confidential information in their possession. Absent an agreement with the law firm, the departing attorney should not make copies of or remove any client files or documents that are confidential to the firm.

As an attorney, obligations to clients continue even if he or she is leaving the firm. Throughout the transition period, lawyers must be diligent to ensure compliance with ethical obligations to existing clients and to help ensure that no client is negatively impacted.

Cal. RPC 5.1(a) requires managing partners to "make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that all lawyers in the firm comply with these rules and the State Bar Act." A law firm's implementation of policies to assist the ethical transition of client matters when lawyers elect to leave the firm can facilitate compliance with these rules and simultaneously protect the parties' and the clients' best interests.

By being mindful of these ethical requirements, lawyers and firms can help make departures as amicable-and ethical-as possible.