A FAMILY LAW ATTORNEY’S DUTY OF COMPETENCE REQUIRES

(1) UNDERSTANDING AND USE OF TECHNOLOGY AND

(2) NOT TO COMMIT MALPRACTICE

 

WITH QDROCOUNSEL MEMBERSHIP FAMILY LAW ATTORNEYS

FULFIL THEIR DUTY OF COMPETENCE

  1. Family Law Attorneys Have a Duty to Become Competent Regarding Retirement Benefits.
  2. The Family Law Attorney is Responsible for the Actions of Other Persons Drafting and Filing QDROs for Their Clients.

 

QDROCounsel will assist you in developing the competence necessary to properly represent your clients in the division of their retirement benefits.

This article addresses the twin “fears” that use of QDROCounsel will alleviate –fear of new technology (and the requisite level of competence required to assist clients with their retirement benefits) and fear of malpractice.

  1. Family Law Attorneys Have a Duty to Become Competent Regarding Retirement Benefits.

The fear of implementing new technology can affect the family law attorney’s level of competence.  Family law attorneys are responsible for assisting clients with division of their retirement benefits and must understand the basics of such division if the benefits are the subject of their representation. Attorneys are required to know the law because they, in addition to a duty of competence, must certify with each paper filed with a Court that they actually know the substantive law. That is, every pleading, motion or other paper submitted to the Court is a representation to the Court that to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:

(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(2) the claims, defenses, and other legal contentions are warranted by existing law or by a non-frivolous argument for extending, modifying, or reversing existing law or for establishing new law;

(See e.g. Fed. Rule 11; Cal. Code Civ. Proc. §128.7)

In family law, every judgment that includes language regarding the proposed division of retirement benefits is a representation that the judgment language will adequately protect the client’s interest in the retirement plan(s) in the case under state and, if applicable, federal law.  This representation implies that the family lawyer is knowledgeable about the law governing the benefits and therefore a representation that they are competent.  Sadly, too many judgments reviewed by QDRO experts fail to adequately protect the client’s interest in retirement plan(s).  Most family law attorneys do not touch pension division and QDROs due to a fear a malpractice but fail to realize the malpractice happens in the judgment.  See the discussion of “fear of malpractice” below for more details.

Attorneys have a duty of competence. 48 states, except California and Maine, have either adopted the American Bar Association Model Rules of Professional Conduct (“Model Rules”) or before the adoption of the Model Rules, the 1969 Model Code of Professional Responsibility. Thirty-nine States have adopted the Model Rules. See State Adoption of the ABA Model Rules of Professional Conduct. Knowledge of the substantive law is only part of an attorney’s duty of competence.

ABA Model Rule of Professional Conduct (“Model Rules”) Rule 1.1 requires that a lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation. (Id.) An attorney’s duty of competence is evolving. As technology and the law intersect the scope of the duty of competence also changes. As noted in a recent Bar opinion, the historical concept of what met the duty of care i.e. a “competent attorney” was traditionally measured by a rough calculation comprised of the attorney’s knowledge of the substantive law combined with experience and ability to represent a client in a particular engagement. (See, e.g., San Diego Cnty. Bar Ass’n, Formal Op. No. 2012-1 (2012)).

As technology has impacted the daily lives of attorneys both in their practice and in the courthouse, the duty of competence requires keeping “abreast of changes in the law and its practice,” which includes knowing “the benefits and risks and associated with relevant technology.” (See 2012 Amended Model Rules Prof’l Conduct TR. 1.1 cmt. [8].) Family law attorneys routinely confront technology in their practice. For example a wide variety of child and support calculators, property division, and other practice related software is frequently encountered and necessary for use in the courtroom.

No matter the state where an attorney is licensed, this duty of competence will at some point include this expanded definition of Rule 1.1 of the Model Rules. As of 3/5/18, twenty-nine states have adopted the ABA’s 2012 amendments to Model Rule1.1.

The 2012 amendment to Model Rule 1.1 prevents an attorney from remaining ignorant of new technologies, or the risks associated with the use of such technology. Attorneys are expected to obtain a basic understanding of the technologies they use, the risks associated with those technologies and the means available to mitigate those risks. (See, e.g., N.H. Bar Ass’n, Advisory Op. 2012-13/4 (2013) (“competent lawyers must have a basic understanding of the technologies they use.”).

While attorneys need not become technology experts or “develop a mastery of the security features and deficiencies” of every available technology:

[T]he duties of confidentiality and competence … do require a basic understanding of the electronic protections afforded by the technology they use in their practice.  If the  attorney lacks the necessary competence to assess the security of the technology, he or she must seek  additional  information  or consult with someone who  possesses  the   necessary knowledge, such as an information technology consultant.

Cal. State Bar, Formal Op. 2010-179 (2010) (emphasis added)

So, what about California? While California does not follow the Model Rules’ approach, a 2015 State Bar ethics opinion addressed an attorney’s ethical duties involving the discovery of electronically stored information relied on Comment 8 to Model Rule 1.1 in reaching the conclusion that the duty of competence requires attorneys to assess their own e-discovery skills and resources. (See Cal. State Bar, Formal Op. 2015-193 (2015)) (“Op. 2015-193”).

California’s Rule of Professional Conduct 3-110 states, in no uncertain terms, that a lawyer “shall not intentionally, recklessly, or repeatedly fail to perform legal services with competence.” See Cal. Rules of Prof’l Conduct r. 3-110(A). “Competence,” under Rule 3-110(B), in any legal service “shall mean to apply the 1) diligence, 2) learning and skill, and 3) mental, emotional, and physical ability reasonably necessary for the performance of such service.” (Emphasis added.) However, where an attorney is not competent, under Rule 3-110(C), the attorney is still permitted to perform services by “1) associating with or, where appropriate, professionally consulting with another lawyer reasonably believed to be competent, or 2) by acquiring sufficient learning and skill before performance is required.” Until recently, California’s Business and Professions Code and Rules of Court codified lawyers’ obligations to complete approved continuing education to achieve this standard. (See Cal. Bus. & Prof. Code § 6070; Cal. R. Ct. 9.31.)

Op. 2015-193 raises the bar for all attorneys practicing in California. Significantly, the opinion anticipates that non-litigators would contend that they are exempt from coverage because their law practices do not involve e-discovery, and sets forth a standard requiring technology competence:

Not every litigated case involves e-discovery. Yet, in today’s technological world, almost every litigation matter potentially does. The chances are significant that a party or a witness has used email or other electronic communication, stores information digitally and/or has other forms of ESI related to the dispute.

Cal. Formal Op. 2015-193 at 3 (emphasis in original).

Further, Op. 2015-193 states when this assessment must be made:

The ethical duty of competence requires an attorney to assess at the outset of each case what electronic discovery issues might arise during litigation, including the likelihood that e-discovery will or should be sought by the other side.

Id. (emphasis added).

As with any other skill or practice area, a lawyer’s duty of technological competence can be achieved through continuing study and education or through association with others who are competent in the area. Model Rules Of Prof’l Conduct R. 1.1 cmts. [2], [8] (2013); Cal. State Bar, Formal Op.2012-184 (2012) (“If Attorney lacks the necessary competence to assess the security of the technology, she must seek additional information, or consult with someone who possesses the necessary knowledge, such as information technology consultant.”); Iowa State Bar Ass’n, Ethics Op. 11-01 (2011) (noting lawyers can meet due diligence technology requirements “by relying on the … services of independent companies, bar associations or other similar organizations or through its own qualified employees”).

The duty of competence requires lawyers to be aware of the benefits and risks of emerging technologies that can be used to deliver legal services and how advances in existing technologies can impact the security of information in their possession. (See, e.g., N.H. Bar Ass’n, Advisory Op. 2012-13/4 (2013) (observing “[c]ompetent lawyers” must “keep abreast of … changes”).The difficulty that we face on this issue is the speed at which technology is advancing. When it comes to understanding the risks and benefits of technology, the lawyer’s duty of competence must evolve as the technologies we use to provide legal services evolve. Cal. State Bar, Formal Op. 2012-184 (2012) (noting “[a]s technologies change, … security standards also may change” and explaining attorneys “should keep abreast of the most current standards so that [they] can evaluate whether the measures taken … to protect client confidentiality have not become outdates”).

QDROCounsel directly addresses the requirement that attorneys keep abreast of changes in technology as well as changes in the law. Use of QDROCounsel’s drafting platform assists attorneys in remaining competent to advise their clients about their retirement benefits. QDROCounsel’s platform is the product of more than 150 years of substantive law experience in the division of retirement benefits and domestic relations orders, qualified or otherwise. The platform is designed to assist the attorney in the proper drafting of QDROs that will conform to the requirements of each client participant’s retirement plan.

The QDROCounsel drafting platform is intuitive, and is designed with several help options including member forums, expert resource referrals, telephone support, articles, videos, and other resources so that every user can successfully and competently draft documents that comport with current law. Further, QDROCounsel provides, through its web-based platform, case specific judgment language that will adequately protect a client’s interest in the retirement plan(s) to be divided under state and, if applicable, federal law.

In short, QDROCounsel is the only platform available 24 hours a day, 365 days a year, and available in every state where family law attorneys can confidently and competently draft judgment language and QDROs.

 

  1. The Family Law Attorney is Responsible for the Actions of Other Persons Drafting and Filing QDROs For Their Clients.

            The second fear that family law attorneys have expressed with regard to retirement benefits is based upon the mistaken belief that they will be sued for malpractice if they do QDROs themselves.  A number of attorneys expressed the belief that it is better to hand off the retirement benefit portion and any malpractice liability to another attorney or QDRO expert who better understands the division of retirement benefits. i.e. “I believe that I can avoid malpractice by having my client retain another attorney or QDRO expert handle the division of retirement benefits or by bringing in that expert to assist with the division of benefits.”

The problem with this rationale is that it is fundamentally false. An attorney cannot hand off their liability when they have a nondelegable duty, which they do because almost all family law attorneys anticipate retention of the attorney through final judgment, which would include disposition of the retirement benefits.  The malpractice with retirement benefits happens in the judgment.  If the judgment language is faulty, or if the family law attorney does not take adequate steps post judgment to protect the client before the QDRO is filed and served on the plan, the family law attorney is responsible for any harm to the client.  The QDRO facilitates the transfer of assets to the nonparticipant spouse based on the terms of the judgment.  Consequently, the belief that malpractice liability can be avoided by retaining others is misplaced.

One major reason that QDROCounsel exists is to stop the malpractice that is rampant by family law attorneys when it comes to retirement benefit division.  It is fairly common for a judgment (1) to fail to properly identify a retirement plan; (2) to omit retirement plan(s); (3) to divide the retirement plan in a manner that is not possible under the plan terms; (4) to fail to divide the retirement plan that complies with state law; (5) to contain inconsistent retirement benefit awards so it is not clear how to divide the retirement plan(s); (6) to fail to properly secure survivor benefits; and (7) to fail to properly secure the client’s post judgment interest in the plan before the QDRO is filed and served on the plan.

QDROCounsel’s goal is to provide intuitive tools in an easy and convenient format that enable the family law attorney to know just what is needed from discovery to judgment and beyond to avoid malpractice. QDROCounsel’s platform is designed to assist the family law attorney in becoming competent.

Moreover, a family law attorney is ultimately responsible for the outside QDRO experts (whether attorneys or non-attorneys) that handle the QDROs for his or her cases.  A family law attorney has a duty to supervise the QDRO expert to ensure that the judgment terms are enacted.  A necessary correlative of the duty of competence includes the duty to supervise (see the Comment to Rule 3-110 and explicit statement in ABA Model Rule 5.1), including not only subordinates within the lawyer’s firm but also non-lawyers both within the firm and outside (see ABA Model Rule 5.3).  Likewise, subordinates have duties to both their supervisors and the client, the courts and other parties (see ABA Model Rule 5.2).

There are any number of vendors (attorneys and non-attorneys) who purport to be “QDRO experts.”  However, their work product falls short of what would be considered a competent QDRO expert.  Lawyers representing the client are responsible to supervise not only lawyers and non-lawyers in their own firms but also the outside vendors whom they hire.  Accordingly, ultimately the ethical responsibility lies with the lawyer.   Thus, the only way an attorney who is not especially competent in the law and practice of retirement benefits can fulfill his or her ethical duty is by (1) taking the time and effort needed to become competent enough to properly secure the client’s interest in retirement benefits in the judgment and (2) to make sure that the pension division occurs properly in the QDRO based on said judgment language.

Accordingly, a lawyer cannot avoid ethical responsibility by “hiring away” QDRO preparation to outside vendors who are not lawyers responsible for the client, in spite of the temptation of some vendors to render the equivalent of legal advice. Rather, the lawyer is ultimately responsible both for the vendor’s performance as well as the protection of the client’s confidential information.

Thus, when the client wants to hire an outside vendor to assist in the preparation of QDRO’s process, the lawyer must become involved in the engagement process to ensure that the vendor understands its confidentiality obligations, has the requisite training, understands its duty to scrutinize its work and its obligations in handling confidential information inadvertently produced by other parties. (See SDCBA Legal Ethics Opinion 2012-1 (2012)(relating to the retention of experts for eDiscovery).)

Rule 3-110(C) permits an attorney to meet the duty of competence through association with another lawyer or consultation with an expert. (See California State Bar Formal Opn. No. 2010-179.) Such expert may be an outside vendor, a subordinate attorney, or even the client, if they possess the necessary expertise. This consultation or association, however, does not absolve an attorney’s obligation to supervise the work of the expert under rule 3-110, which is a non-delegable duty belonging to the attorney who is counsel in the litigation, and who remains the one primarily answerable to the court. An attorney must maintain overall responsibility for the work of the expert he or she chooses, even if that expert is the client or someone employed by the client.

The Model Rules provide a similar duty to supervise the work of an expert or other attorney. A lawyer may be subject to professional discipline under certain circumstances for the unethical conduct of another attorney. A lawyer will be held responsible for another attorney’s rule violation (1) if the lawyer ordered or ratified the conduct, or (2) if the lawyer is a partner or lawyer with comparable managerial authority in the other attorney’s firm, or has direct supervisory authority over the lawyer, and knew of the misconduct but failed to take remedial action to mitigate or avoid its consequences. Model Rule 5.1(c); Restatement (Third) of the Law Governing Lawyers§ 11(3)(2000). This rule “expresses a general principle of personal responsibility for acts of another,” similar to Model Rule 8.4(a). Rule 5.1 cmt.[4].

A lawyer may be held responsible for any other lawyer’s ethics violation if the lawyer orders or ratifies the misconduct. Rule 5.1(c)(1);Restatement § 11(3)(a). This basis for discipline is “a kind of accessorial liability.” Restatement § 11 cmt. e. Lawyers can be disciplined under Rule 5.1(c)(1) if they instruct another lawyer to commit misconduct. E.g., In re Asher, 772 A.2d 1161, 1169 (D.C. 2001) (lawyer encouraged former associate to lie to court, dictated false letter for her to sign and send to court, and instructed her to “stick with the story” rather than be truthful with court); In re Hartley, 869 So. 2d 799 (La. 2004) (lawyer violated Rules 5.1(c)(1) and 8.4(a) by directing another lawyer to notarize signatures on document without seeing it signed; however, court declined to impose discipline for “minor violation” in light of lawyer’s long and previously unblemished career).

Lawyers can also be disciplined under Rule 5.1(c)(1) if, knowing of another lawyer’s misconduct, they accept and approve it. E.g., Kentucky Bar Ass’n v. Mills, 318 S.W.3d 89, 26 Law. Man. Prof. Conduct 346 (Ky. 2010) (lawyer not only defrauded clients in mass tort litigation but also ratified co-counsel’s misconduct); Maryland Attorney Grievance Comm’n v. Johnson, 976 A.2d 245, 25 Law. Man. Prof. Conduct 451 (Md. 2009) (lawyer-owner of title agency ratified misconduct of lawyer who served as settlement agent in fraudulent lease/buyback arrangement); In re Bowden, 613 S.E.2d 367 (S.C. 2005) (associate who managed satellite office of firm knew of its practice of inflating government recording fees in settlement statements yet did not inform clients or ensure accuracy of information about fees on settlement statements).

Thus, an attorney who retains another attorney to prepare QDROs and fails to properly supervise that attorney or expert will have violated their duty of supervision if they ratify the conduct by failing to determine whether the referred attorney is complying with their own ethical obligations to the client i.e. performing diligently and competently.

In many jurisdictions, attorneys routinely refer to outside QDRO experts the preparation of joinders, QDROs and other documents necessary to implement the terms of a judgment or decree involving retirement benefits. As noted above, if the client suffers a loss, there is no doubt that the attorney who “handled the dissolution of the marriage” will be sued by the client who suffers a loss regardless of whether the mistake was made by the referred attorney or expert. Further, given the duty to supervise found both in the Model Rules and California’s Rules of Professional Conduct, the family law attorney who refers the division of retirement benefits to another person is trusting that the other person is competent and cannot hand off their malpractice liability by such actions.

Note that there is another group of family law attorneys who are drafting QDROs for their clients based on “model language” provided by a plan or based on a QDRO that was approved in the past either for that plan or some other plan.  The experts associated with QDROCounsel often are retained to review this work and are astounded by the level of malpractice in the QDROs prepared by family law attorneys who are not competently practicing pension law.  The good news is the QDROCounsel can also help these family law attorneys become sufficiently competent in the division of retirement benefits in each of their cases.

 

CONCLUSION

Most QDROs are handled after the divorce is final by a QDRO expert.  The reality is that most clients do not want to pay both a family law attorney and a QDRO expert to handle pension division after the divorce is final because it becomes too expensive.  Almost all family law attorneys substitute out of their cases after the divorce is final but before the QDRO(s) are properly filed and served on the plan(s).  On a regular basis, the experts associated with QDROCounsel see malpractice in judgments, malpractice made by other QDRO experts and malpractice made by family law attorneys doing QDROs.  It is time for family law attorneys to stop practicing law in this manner.

Family law practitioners owe their clients a duty to become competent regarding the division of retirement benefits in the clients’ dissolution of marriage.  QDROCounsel’s platform and support make the task of becoming competent easy.  With QDROCounsel, family law attorneys can take control of retirement division from discovery through judgment.  They can and should, if possible, file the QDRO concurrent with the judgment!  Family law attorneys will know during their case what is possible to handle through QDROCounsel’s website and what should be referred to an outside QDRO Expert.  Further, with QDROCounsel’s drafting platform, family law practitioner’s will make more money because they will be able to take the task of drafting QDROs in-house, provide better service to their clients, while charging the fair and reasonable value for those services.