Bar Licensing and Regulatory Issues for Lawyers in Transition
If you’re planning to transition out of the law, be sure to comply with the State Bar rules on licensing and membership status.
They’re pretty simple, actually. To practice law in North Carolina, you must have an active license. If you retire but want to keep your options open for part-time practice or serving “of counsel” with a firm, you will need to keep your license active – which means you will have to continue paying annual dues and meeting the CLE requirements.
On the other hand, if you have no intention of practicing, you can petition for Inactive Status. This is the equivalent of resigning from the State Bar. If your petition is granted, you will be relieved of future dues and CLE obligations.
If your transition involves closing your office, you will want to follow the State Bar’s 14-point checklist that covers everything from wrapping up cases to disposing of files.
Moving to Inactive Status
This begins by filing a Petition to Transfer to Inactive Status. You can find the petition – along with detailed instructions for completing it – at the State Bar website.
The petition must be reviewed by the Administrative Committee and approved by the State Bar Council. The committee and the council meet quarterly in January, April, July and October of each year. The dates of the meetings are posted on the website.
If your request for inactive status is granted, an inactive order will be mailed to the address you provide on the petition within a couple of weeks after the meeting.
As an inactive member, you cannot practice law in North Carolina. This includes giving advice on North Carolina law or serving as a judge in any tribunal that requires an active state license. You are also prohibited from serving in an “of counsel” capacity and from holding yourself out as a lawyer, attorney, attorney at law or any other designation that implies that you are an active attorney who can provide legal services in North Carolina.
However, if you want to assist with the representation of Legal Aid clients (or other indigent persons served by a nonprofit corporation), you may petition for emeritus pro bono status.
If after going inactive you want to return to active status, you can submit a Petition for Reinstatement. There is a short form petition if you have been inactive for a year or less, and a long form petition for periods greater than a year.
Office Closing Guidance
You might not be aware of the State Bar’s checklist for Closing a Law Practice. It’s a valuable resource.
It provides instructions on how to notify clients and close out their files. It includes guidance on disbursing funds held in your trust account and delivering trust funds to successor counsel. And it recommends that you contact your malpractice carrier about continuing your liability coverage.
The checklist also lists some important ethics opinions applicable to office closings, such as: releasing files to clients, electronic storage of files, retention periods for closed files, and recycling office paper.
5 Practice Tips for Complying With Bar Rules
- Decide on your membership status. What are your future plans? Do you have an intention to continue practicing law in some capacity? If so, you will need to maintain an active license.
- Think before you leap. Before making a move, talk to family members, law partners and trusted colleagues. Even though you can request to reactivate your membership after going inactive, the process will take time and money.
- Contact the State Bar. Their administrative team can answer any questions you might have.
- Pay attention to the December 31 deadline. If you choose to go inactive, your petition must be postmarked on or before December 31st to avoid incurring membership fees for the following year.
- Wrap up Bar business before checking out. Your petition for inactive status will not be granted if you haven’t paid your dues or fulfilled your CLE requirements for the year in which it is filed.
For more tips check out our blog series here.
Sources:
· NC State Bar http://www.ncbar.gov/
· NC State Bar Petition for Transfer to Inactive Status https://www.ncbar.gov/media/300292/instructions-for-petitioners-for-inactive-status-.pdf
