Outline of crossborder legal services

International Business Transactions

1. Transnational Lawyering and Litigation
A. The Rules of Transnational Practice
i. In re Roel (NY Court Appeals)
a. Mexican lawyer maintained office in NY and advised NY public on MX divorce law.
b. Held: Foreign lawyer cannot practice law in NY
1. NY Penal Law, Section 270 forbids anyone from “practicing law” without being licensed by the NY bar.
2. MX Lawyer gave “legal advice.” Even if the advice was about the law of MX. What matters is the nature of the activity performed, not the sources of the law that he practices. Violated NY law and enjoined to give any advice
3. Ct worried about protecting the public from unregulated legal advice. Even if lawyer is more competent of MX law, and has no impact in NY. Policy: If not a member of NY bar, cannot be disciplined for violating rules being admitted to bar gives authority to regulate lawyer.
c. Dissent: Majority too broad and harmful to public.
1. Lawyer should practice if impact on NY. Foreign lawyers should give advice on Foreign Law bc they are good at it. Otherwise, we get sub-standard advice.
2. On majority reasoning, NY residents could seek advice from the following:
A. NY lawyer
B. Foreign lawyer admitted in NY, or
C. Foreign lawyer in foreign lawyer’s jx.
d. Tension bw giving clients access to those who know most of the law and regulating the availability of specialized advice.
ii. Modern NY Law
a. “Foreign Legal Consultants” can give advice on following
1. Own country ‘s law; and
2. NY and US law if based on the advice of a NY Attorney .
b. FLC are subject to discipline in the same manner as NY lawyers.
c. ABA also recognizes FLC, but not all states do
iii. ABA Model Rule 5.5
a. Two questions to ask
1. Am I competent?
2. Will I be engaging in the unauthorized “practice of law” or “lower level activity” ?
b. Competent Required
1. A lawyer must practice competent representation to client (legal knowledge, skill, thoroughness, and preparation)
A. Subject to malpractice and state bar discipline
c. Unauthorized Practice of Law
1. No lawyer shall “practice law” in jx that violates the regulation of that jx
A. Incorporates by reference rules from other jx
B. If American lawyer in France: be aware of both France and US rules
2. No unlicensed lawyer shall establish office or “systematic office or presence” for purpose of practicing law, unless otherwise authorized
A. “Lower level of activity” may be permitted, so long as does not “represent to public” that he is admitted to practice law.
B. Hypo
i. Can CA lawyer advise client on whether a K’s choice-of-law provision is enforceable in US?
a. Informal Advice
1. Yes. Choice-of-law is governed by State law . Even if this is a NY law issue, CA lawyer is competent to give advice of other states. If not, at least you know how to do the research.
b. Formal Advice
1. Cannot sign opinion letter (a formal legal opinion that client can hold against you) if not admitted in jx.
2. But, can draft the letter as long as you don’t sign it.
ii. Can CA lawyer advise client whether a distributorship agreement’s territorial restrictions violate Article 85 of Treaty of Rome?
a. Competent?
1. Depends on EU law
b. Authorized to practice?
1. Depends on EU law
2. You may also violate US rule 5.5
c. However, can suggest changes if competent to give it as long as informal advice.
iii. Can CA lawyer advise client whose investment in another country as been expropriated on the CIL rules concerning expropriation?
a. Yes, International law ( Treaties and Customary International Law ) is everyone’s law and thus is American law.
1. The issue is whether competent, and authorized to practice law
iv. What concerns does the AM&S case raise about the confidentiality of such advice?
a. Rule 8.5 (p. 16)
1. Lawyer’s Ethical Duty when Rules of Different Jx Conflict
v. Hypo: In business transaction (not dispute) US requires disclosing client’s fraud; other party’s jx prohibits disclosure.
a. If MR 8.5(a) (own j has authority over you), (b) deals with choice of law who’s rules do you follow?
1. Is this a dispute? If in arbitration, look at pace of arbitration. If preparing a witness for that arbitration in different jx, may be different.
2. If not, where is the predominate effect of conduct? Look to where the oher person is located. Here, disclosing or not disclosing fraudulent conduct. Of fraud of foreign party, most likely in other party’s jx (which ironically says don’t disclose).
3. Do not have to disclose bc law of predominate effect says not to disclose.
b. Conclusion: while the rules of your jx require disclosure, bc the jx of the predominant effect prohibits disclosure, you are allowed not to disclose.
C. AM&S (Court of Justice of EU)
i. EC investigates under own antitrust law (equivalent to Section 1, 2 of Sherman Act). EC responsible for enforcing anti-competitive rules. EC requests documents; party defends it is privileged.
ii. Appeals: Upheld privilege with limitations if communication made for purpose of client’s defense and come from “independent lawyers” (top of 14)
a. Communications for Client’s Defense (Lowest common denominator approach)
1. Broad interpretation of client’s defense: applies to communications made before case if deal with same subject matter.
A. Here, communications occurred before enforcement, but dealt with same subject whether AMS would violated EC competition law.
b. Advice must come from independent lawyer not employed by client and licensed to practice in EU
1. AMS’s own General Counsel is not independent bc employed by AMS
2. Communications from outside counsel authorized only in US not protected
3. Only applies to lawyers admitted in EU state.
c. Conclusion: operation of privilege depends on the proceeding at issue
1. Privilege in enforcement proceeding is narrower than other proceedings
2. Thus, outside counsel licensed in EU jx is privileged.
d. Solution re structuring your legal representation if you are a multi-national corporation: use outside counsel licensed to practice in a EU jurisdiction.

1. Ethical Rules for Lawyers
A. Model Rules 1.1
i. US lawyers must have sufficient knowledge of law
ii. 5.5 prevents US lawyers to engage in authorized practice of law in foreign jx
2. In re Roel
i. Confidence and XX in tension
ii. NY Court of Appeals holds that Mexican lawyer cannot give advice about Mexican law, unless NY bar
iii. Denies NY Public was denied advice from foreign lawyers who were the most competent to give that advice
B. After that case, NY passed law to license foreign lawyers as FLC
i. Foreign Legal Consultants can give advice and subject to discipline by NY Bar
C. HYPO
i. A CA lawyer should be competent to advice on whether choice of law clause is enforceable in US Courts w/o engaging in unauthorized practice of law
a. Can CA lawyer give advice about whether territorial restrictions in distributor agreements violates EU antitrust law?
1. CA lawyer should be familiar with EU law generally and EU competition law specifically
b. If competent, probably would give informal advice but not formal advice (opinion letter) without being admitted to practice in a EU member state
c. A CA lawyer could be competent to give advice on the CIL about expropriation w/o unauthorized practice of law bc it is part of US law.
d. If two jurisdiction rules of professional conduct point in different directions, Model Rule 8.5 say US lawyer should follow rules where Tribunal located (if a Tribunal is involved) or place where the conduct would have a predominant effects
D. Attorney Client Privilege
i. AMS Case
a. The European Court of Justice allows privilege, but limited to advice from independent lawyers admitted in EU
b. This means most American lawyers cannot operate in the EU system.
c. The larger point of this case is that it comes as something of a surprise that advice you might want to give might not be privileged. You should take nothing for granted in international transaction law.

Author: admin

Author: admin

Mentioned in these Entries

Attorney, Customary International Law, Foreign Law, State law, Treaties, country.