Local Counsel — Duties and Responsibilities

Local Counsel – Duties and Responsibilities

By Francis J. Gorman

Serving as local counsel during litigation is a very common practice. Local counsel usually has lesser contact with the client. Most attorneys interpret “local counsel” to mean having only a supporting or behind the scenes role. Being only “local counsel” might lull an attorney into a false sense of diminished responsibility.

Thinking and acting that way could produce serious consequences. The Model Rules of Professional Conduct and the latest drafts of the Restatement, The Law Governing Lawyers do not use the term “local counsel” and make no distinctions based on local counsel status. Even as local counsel, an attorney has significant obligations to the client, to the court, and to lead counsel.

In Bill Bogaert’s article entitled “Out Of State/Out Of Pocket” in a previous Risk Management Memo, he recommended that out-of-state attorneys retain a lawyer admitted in the local jurisdiction. Bill discussed two court decisions highlighting the importance for lead counsel to avoid the unauthorized practice of law and to protect the right to payment for legal services in a jurisdiction where lead counsel is not a member of the bar. Bill wrote from the perspective of lead counsel; this article addresses the situation from the perspective of local counsel.

How Local Counsel Is Engaged

There are basically two ways an attorney is retained to act as local counsel. First, lead counsel brings the client and local counsel together, and local counsel is engaged directly by the client. Second, with the consent of the client lead counsel engages local counsel, and it can sometimes be unclear whether lead counsel is responsible for local counsel’s fees.

Once an attorney undertakes to act as local counsel, certain duties and potential liabilities arise. Local counsel (1) must exercise reasonable care and diligence in the representation of the client and in the assistance to lead counsel, and (2) owes fiduciary duties to the client imposed by the Rules of Professional Responsibility. Local counsel, who usually sponsors the special or pro hoc vice admission of lead counsel, must also supervise lead counsel with respect to the representation before the court.

Local Counsel And The Client

That local counsel owes a duty to the client and can be liable to the client for negligence is clear. Ortiz v. Barrett, 278 S.E.2d 833, 838 (Va. 1981); Ingemi v. Pelino & Lentz, 866 F. Supp. 156 (D.N.J. 1994); Gould, Inc. v. Mitsui Mining & Smelting Co., 738 F. Supp. 1121 (N.D. Ohio 1990); Neel v. Magana, Olney et al., 98 Cal. Rptr. 837, 491 P.2d 421 (1971); Wildermann v. Wachtell, 267 N.Y.S. 840, 841 (1933), affirmed, 271 N.Y.S. 954 (1934).

Negligence or breach by any specific act or omission depends on the assignments from lead counsel and on the relationship with the client. Local counsel can limit the scope of representation under Rule 1.2 of the Rules of Professional Conduct and should always make clear who is responsible for any particular aspect of the representation.

Whether a client can hold an attorney acting as local counsel liable for malpractice or for breach of a fiduciary duty will depend on the evidence of the circumstances in each situation. Ortiz v. Barrett, supra, is the leading case delineating the particular responsibilities of lead and local counsel and exonerating local counsel for the negligence of lead counsel. In Ortiz, a lawyer who acted as local counsel in Virginia for a District of Columbia attorney was held not liable for lead counsel’s: (1) negligent pleadings filed with local counsel’s name but without his authorization, (2) forgiveness of a default by a defendant, (3) decision not to appeal an erroneous dismissal, and (4) decision to pursue one client’s claim at the expense of the other three clients. Any comfort for local counsel in this decision, however, is tempered because lead counsel was deceased (never testified) and there was a strong dissent. In Gould, supra, the court held that a client’s consent to a law firm acting as local counsel constituted valid consent to that same firm acting as lead counsel:

Although the term “local counsel” at one time may have meant less responsibility on the part of attorneys so designated, it is clear to the court, and should be to every lawyer who litigates in this country, that in the last ten years developments in the law have invalidated this prior meaning. The trend is, properly, away from the view that some counsel have only limited responsibility and represent a client in court in a limited capacity, or that the local counsel is somewhat less the attorney for the client than is lead counsel. 738 F. Supp. at 1125.

Local Counsel And The Court

While the extent of the obligation to the client depends on the circumstances, courts have been strict in holding local counsel fully responsible to the court for the actions of lead counsel. Local counsel has a duty to supervise lead counsel. In Ingemi, supra, local counsel contended that the firm should not be a defendant in a malpractice suit because of its limited role in the case. The court rejected the narrow view of local counsel’s role:

Defendants further suggest that Pelino & Lentz is not a proper defendant because any potential liability of Pelino & Lentz is narrowly circumscribed and would relate solely to its alleged limited engagement as local counsel. This court concludes that defendants underestimate the role of local counsel.Local counsel must also supervise the conduct of pro hoc vice attorneys and must appear before the court in all proceedings. Even if pro hoc vice attorneys attempt to delegate solely routine or ministerial tasks to local counsel, local counsel remains counsel of record and wittingly or unwittingly exposes itself to liability for penalties such as sanctions. 866 F. Supp. At 161, 162 (citations omitted).In Colburn Optical Industries v. Cilco, Inc., 610 F. Supp. 656 (M.D.N.C. 1985), the court assessed attorneys fees as a Rule 11 sanction against local counsel for filing a motion to dismiss without making a reasonable inquiry of the facts and for continuing to press the motion after discovering facts which rendered the motion untenable:

Local counsel seemed blindly to follow the commands of its out-of-state associates who in all probability prepared most, if not all of the motion. What Rule 11 requires is that the lawyer who elects to sign a paper take responsibility for it, even if that responsibility is shared. 610 S. Supp. At 660.

Local Counsel And Lead Counsel

There are also obligations to lead counsel as well. In Vale v. Heitner, 396 N.Y.S. 2d 602 (1977), the court concluded that a referring attorney had a cause of action against trial counsel for the breach of an implied duty of care. In Pollack v. Lytle, 120 Cal. App. 3d (1981), the court held that a lawyer to whom a case had been referred for trial was liable for a breach of fiduciary duty owed to the principal attorney.

Practice Tips For Local Counsel

Forewarned is forearmed said Cervantes in Don Quixote. Here are some suggestions:

1. Put it in writing. Make clear throughout the case your understanding of the scope of your duties and undertakings.2. Ask at the outset if lead counsel is also responsible for your fee and confirm the billing and payment arrangements in writing.3. Read and review all pleadings filed by all parties both for adherence to local practice and for substance. Raise with lead counsel any concerns and do not sign until your concerns have been resolved.4. Beware when you see or sense warning signs that things are not right. For example, lead counsel says that local counsel will not be paid for reviewing pleadings for substance, or lead counsel forbids local counsel from having any contact with the client, or your bills are not paid as promised. Heed the warnings and withdraw.5. Be competent and diligent!


Reprinted with permission from the Risk Management Memo Published by the Professional Liability Division, Great American Insurance Co. greatamericanlawyer.com.