189 N.J.L.J. 253
July 16, 2007
16 N.J.L. 1401
July 23, 2007
Advisory Committee on Professional Ethics
Appointed by the Supreme Court of New Jersey
Advisory Committee on Professional Ethics
Divorce Mediation Centers Operated By New Jersey Attorneys
An inquirer questions whether a commercial center for divorce mediation (hereafter “Center”) run by a New Jersey attorney from an out-of-state office under a trade name, “___ Center for Divorce Mediation, P.C.,” is operating consistent with the New Jersey Rules of Professional Conduct.
The attorney responsible for the Center describes its operations as follows:
An attorney, who is responsible for guiding our clients through a non-adversarial divorce process, handles each case. As in the litigated divorce process, clients are referred to accountants and therapists to deal with ancillary, non-legal issues. The only difference is that our referral list of professionals includes only those who agree to act as neutral mediators.
All of the attorneys, accountants and therapists affiliated with the Center have their own individual practices. They provide the Center with a calendar of open appointments. Based on the attorney's recommendation, our client coordinators will match clients with the professionals whose services are needed and whose schedules are compatible. The meetings are held in the same office so that clients do not have the inconvenience of finding several different locations.
When a tentative agreement is reached on all outstanding issues, the attorney provides the clients with a draft of a settlement agreement, pro se divorce proceedings and a copy of all supporting documentation. The clients are directed to take these documents to separate litigation attorneys for review.
The Committee reaches the following conclusions:
The attorneys affiliated with and taking mediation cases on referral from the Center are practicing law. In effect, they are accepting clients in a form of limited representation, consistent with RPC 1.2(c), for the sole purpose of serving as a third-party neutral, as contemplated in RPC 2.4.
2. All conduct of attorneys practicing law is governed by the Rules of Professional Conduct. The Center's website is replete with references to the furnishing of legal advice (e.g., “[Center] attorneys … help you make the decisions and navigate the necessary legal procedures”; “your attorney-mediator helps you understand your legal rights and obligations”; “your rights under law are explained and you are encouraged to make an agreement that follows the law”). As such, the Center is plainly offering the services of attorneys to provide legal advice.
The amounts paid by the client for a lawyer's mediation services are legal fees. They are fixed by and paid to the Center. RPC 5.4(a) prevents sharing of legal fees with a non-lawyer (here the Center), and this situation is not within the exceptions listed in the Rule.
It is possible that a mediated settlement may not be in a client's best interest: imbalance of power, a controlling relationship, lack of sophistication or other factors may make a nominally “voluntary” agreement severely disadvantageous to one party.
For an attorney to limit representation to neutral mediation services in a way that is proper under RPC 1.2(c), the attorney must fully disclose that the attorney cannot and will not at any time act as the client's individual lawyer, nor provide legal advice or representation adverse to the other party to the dispute, and that it may be in the client's best interest to engage a separate attorney who represents only that client. Furthermore, all of the safeguards contained in ACPE Opinion 699, 182 N.J.L.J. 1055 (December 12, 2005), 14 N.J.L. 2474 (December 12, 2005), are applicable to this disclosure. As noted in Opinion 699, a lawyer may participate in the collaborative law process only if: (i) based on her knowledge and experience, after being fully informed about the existing relationship between the parties, the lawyer has no reason to believe that there is any significant possibility that the process will fail; and (ii) the lawyer discloses to the clients the potential risks and consequences of the failure of the collaborative law process, including a description of the alternative procedures available with all of their attendant risks and consequences, thereafter receiving informed consent of both clients. None of these safeguards are apparent here. For such mediation representation to be deemed “reasonable” under RPC 1.2(c) and consistent with the requirements of RPC 1.7(a), the clients must give informed consent after such disclosure is made.
The Center's requirement that an affiliated attorney make other referrals, for therapy and accounting services, only to professionals approved by the Center, violates the duty of independent judgment concerning referrals to other professionals solely in furtherance of the client's best interests, free from any economic or other incentives that might impinge on the lawyer's judgment. See RPC 5.4(c); ACPE Opinion 694, 174 N.J.L.J. 460 (November 3, 2003), 12 N.J.L. 2134 (November 3, 2003).
“_____ Center for Divorce Mediation, P.C.,” run by a lawyer and involving other “affiliated” lawyers, is not a permissible trade name under RPC 7.5.
It is unclear whether the Center involves a partnership with any non-attorneys. Since it is practicing law, any such partnership would be a violation of RPC 5.4(b). The Center appears to be a for-profit enterprise, not the kind of not-for-profit entity for education of the public about the benefits of mediation that was examined and conditionally permitted in Opinion 699.