MPRE Law Firms 5 — Questions and Answers
Question 1: A law firm is approached by a legal process outsourcing company based in a foreign country to handle document review for the firm's clients. The firm must:
- Decline all outsourcing to avoid unauthorized practice issues
- Supervise the outsourced work and disclose the arrangement to clients when necessary (Correct answer)
- Obtain state bar approval before outsourcing any legal work
- Ensure only licensed US attorneys perform any portion of the review
Correct answer: Supervise the outsourced work and disclose the arrangement to clients when necessary
Rule 5.3 requires supervision of non-lawyer assistance, and outsourcing disclosure may be required depending on the engagement terms.
Question 2: A managing partner at a law firm discovers that the firm's trust account has a shortfall due to accounting errors, not intentional theft. The partner's obligations include:
- Correcting the error quietly to avoid reputational damage
- Promptly notifying affected clients and making the account whole (Correct answer)
- Reporting only to the firm's malpractice insurer first
- Waiting until the next quarterly audit to assess the full extent of the problem
Correct answer: Promptly notifying affected clients and making the account whole
Rule 1.15 requires that client funds be safeguarded and any shortfall must be corrected and clients notified without delay.
Question 3: A law firm associate is ordered by a senior partner to sue a former client in a matter directly adverse to the prior representation on the same subject. The associate should:
- Follow the instruction since partners have supervisory authority
- Refuse, as this would violate duties owed to the former client under Rule 1.9 (Correct answer)
- Seek guidance from the state bar before deciding
- Comply only if the former client's new attorney consents
Correct answer: Refuse, as this would violate duties owed to the former client under Rule 1.9
Rule 1.9 prohibits representing a client in the same or substantially related matter adverse to a former client without consent.
Question 4: A law firm receives a referral from a title insurance company that pays the firm a flat monthly fee in exchange for all real estate closings the company sends. Under the Model Rules, this arrangement:
- Is a permissible referral fee agreement under Rule 7.2
- Is prohibited as fee splitting with a non-lawyer entity that refers clients (Correct answer)
- Is permissible if each referred client provides informed consent
- Is allowed if the monthly fee does not exceed 10% of closing revenues
Correct answer: Is prohibited as fee splitting with a non-lawyer entity that refers clients
Rule 7.2 prohibits giving anything of value to a person for recommending the lawyer's services, except under specific limited exceptions.
Question 5: A law firm's name is 'Johnson, Smith & Associates.' Johnson died five years ago and Smith retired last year. The firm continues to use the same name. Under the Model Rules, this practice:
- Is prohibited because both named partners have left the firm
- Is permissible if the firm is a successor to the partnership under which those names were used (Correct answer)
- Requires each remaining attorney to individually consent in writing each year
- Is allowed only if the jurisdiction permits deceased partner names indefinitely
Correct answer: Is permissible if the firm is a successor to the partnership under which those names were used
Rule 7.5 permits continued use of a law firm name that includes the names of deceased or retired partners if it is the successor of the firm.
Question 6: A law firm partner discovers that an associate, under extreme financial pressure, borrowed $500 from client funds intending to repay the money within the week. The partner learns of this before the associate repays. The partner should:
- Give the associate a week to repay before taking any action
- Take immediate action to protect client funds and address the misconduct (Correct answer)
- Quietly terminate the associate without further action to protect the firm
- Notify only the firm's malpractice insurer of the incident
Correct answer: Take immediate action to protect client funds and address the misconduct
Borrowing client funds is misappropriation regardless of intent to repay; Rule 5.1 requires immediate remedial action and Rule 8.3 may require reporting.
Question 7: A law firm markets a 'flat fee divorce package' on its website without disclosing that contested divorces involve additional costs. This advertising practice:
- Is permissible since flat fees are a recognized billing method
- Is misleading because it omits material information about likely additional costs (Correct answer)
- Complies with Model Rules if the fine print links to the firm's fee schedule
- Is only prohibited if a client is actually harmed by the misrepresentation
Correct answer: Is misleading because it omits material information about likely additional costs
Rule 7.1 prohibits communications that create a false or misleading impression, and advertising a flat fee without disclosing likely additional costs is misleading.
MPRE Law Firms 5
A law firm is approached by a legal process outsourcing company based in a foreign country to handle document review for the firm's clients.
The firm must: