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In 2024, the bar admitted its first licensed paralegals (LPs). LPs are licensed to provide limited-scope legal services in family law and landlord-tenant law. LPs are regulated by the bar and must follow professional conduct rules like the lawyer’s Rules of Professional Conduct (RPCs), known as the Rules of Professional Conduct for Licensed Paralegals (RPC-LPs). Violations of the RPC-LPs subject an LP to discipline by the bar. Currently, there are approximately 24 LPs licensed within Oregon.

However, the RPCs, when adopted, never envisioned a new type of limited licensed practitioner. Currently, the RPCs utilize the term “lawyer” with the connotation that lawyers are the only persons licensed to practice law in Oregon. This limitation has raised ethical questions about the relationship between attorneys and LPs. For example, one open question is whether a lawyer can talk to an opposing party represented by an LP, or is the lawyer limited to talking to an opposing party’s LP under the no-contact rule in RPC 4.2.

Recognizing these challenges, the LEC undertook a detailed review process, meeting with stakeholders, including practicing LPs, to carefully evaluate necessary changes to harmonize the current RPCs with the introduction of LPs. After a review, the LEC recommended multiple amendments to the current RPCs to consider LPs in relation to lawyers within the RPCs.

These amendments are throughout the RPCs and noted in Exhibit 1. A summary of the changes is listed in the in the chart below. Most of these amendments are perfunctory and simply add LP in addition to lawyer.

Rule	Change
1.0 (d)	Added LPs to definition of Firm.
1.0 (r),(s),(t)	New LP-specific definitions.
1.5 (b) (7)	Added LPs to consideration of experience in determining fees.
1.5 (d)	Added section allowing for the division of fees between LPs and lawyers of different firms if fees are divided proportionally to the services performed.
1.5(e)	Added LPs to non-prohibition of payments for sale of law practice.
1.6	Added LPs to confidentiality provision.
1.7 (a)(3)	Added LPs to closely related conflicts under this provision.
1.10 (a),(c)	Added LPs to imputation rules; LP conflicts impute the same way lawyer conflicts would under the RPCs or the equivalent LP Rules.
1.11 (b)	Added LPs to imputation rules; LP conflicts impute the same way lawyer conflicts would under the RPCs or the equivalent LP Rules.
1.12(b)	Added that a lawyer acting as a judge or third-party neutral may not negotiate for employment with a lawyer or LP who represents a party in the proceeding.
1.12(c)	Added that if LP is disqualified under 1.12(a), the disqualification imputes the firm absent screening.
1.17	Added that an LP may sell a practice to the lawyer in accordance with this rule.
3.3(a)(2)	Opposing LP added to duty of candor.
3.6(d)	LP added to firm prohibition on statements.
4.2 (a),(c)	Party represented by LP added to no-contact rule.
4.3	Party represented by LP added to unrepresented client rule.
5.1	LP added to lawyer’s responsibility for violations of the RPCs, or the equivalent RPC-LP rule.
5.6	Added LP to prohibition on restriction of right to practice.
5.8	New Rule. Establishes structure for LP and lawyer ownership of firms.
6.5	Adds LPs to 1.7 potential conflict issues when lawyers are helping with a nonprofit legal services program.
8.3	Adds LP to lawyers’ mandatory reporting requirements.

 

The LEC had several discussions where adding LPs to certain provisions of the RPCs raised concerns with practitioners. Lawyers and LPs highlighted specific concerns.

One concern raised was about referral fees between lawyers and LPs in different firms. LPs noted that fee-splitting arrangements may be necessary in situations where client issues exceeded an LP’s scope of practice. For instance, LPs dealing with family law matters occasionally encounter complex issues that exceed the scope of their limited practice, such as qualified domestic relations orders (QDROs) and retirement asset divisions. LP must refer these matters to a lawyer under their scope-of-practice rules.¹

Lawyers raised concern about LPs obtaining clients clearly outside of an LP’s practice area (such as personal injury) and requesting a referral fee to refer the clients to a lawyer. After substantial debate, the LEC resolved this concern by implementing proportionality language. This language requires any fee splitting between LPs and attorneys in different firms be proportionate to the services each lawyer and LP provides. This amendment would address concerns about referral fees outside of an LP’s scope of practice while ensuring LPs receive fair compensation for their contributions. The amendment does not change the current rule for fee splitting between lawyers.

Firm partnership between LPs and attorneys was another significant issue discussed by the LEC. Multiple models of firm ownership were considered. The LEC agreed that LPs should have some capability to have ownership in firms. However, the LEC also noted that a wholly owned LP firm with lawyer employees created substantial supervision and professional independence concerns under RPCs 5.2 and 5.4.

The LEC also heard concerns about allowing LPs within a firm to partake in fees that were outside their scope of practice. After discussion, the LEC determined fee divisions within a firm were business decisions best left to the firm and market forces to resolve. As LPs are regulated in the same manner as lawyers, several concerns that led to the prohibition surrounding fee splitting with nonlawyers did not exist. Allowing firms to have the freedom to select LPs as potential partners provides firms freedom to experiment with LPs to serve clients only needing limited scope services. However, supervision of a lawyer by an LP continued to raise concerns about professional independence.

To resolve this issue, the LEC recommended adopting a new rule based on the rule utilized by the Washington State Bar in its integration of limited license legal technicians (LLLTs) in 2012. The new rule, proposed Oregon RPC 5.8, allows LPs to hold an ownership or partnership stake in law firms under specific conditions designed to preserve professional independence and supervision. LPs cannot hold majority ownership, cannot exert supervisory authority over attorneys, and cannot influence attorneys’ professional judgment. Attorneys within the firm retain majority control and managerial responsibility, ensuring professional integrity and proper supervision.

The Board of Governors evaluated the amendments and noted that these changes are critical for the success of LPs within Oregon. They recommend that the House of Delegates approve these amendments accordingly.

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¹ See Rules for Licensening Paralegals. Section 11 Scope of Practice Rules for Licensed Paralegals in Oregon.