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Sharing Space Also Can Mean Sharing Risk

Often, a group of attorneys will share office space to trim overhead expenses, share resources, enhance their public image or simply enjoy a little camaraderie. While such arrangements can help make a lawyer’s practice more profitable and fulfilling, they present risks the participants may fail to recognize.

In particular, depending upon their interactions with their clients and each other, lawyers sharing space can create an apparent partnership that may, in turn, place them at risk to be found vicariously liable for their officemates’ torts. Sharing space also makes protecting confidentiality a greater challenge.

Legal malpractice plaintiffs tend to sue not only the individual attorney handling (or mishandling) their case, but also the attorney’s firm and any other lawyer who appears to be even partly responsible. This is especially true if the lawyer actually providing the services is uninsured or underinsured.

If the circumstances in which a client interacts with an attorney reasonably lead the client to believe – or suggest to a court that the client could believe – that the representation was provided by a partnership of attorneys, the collection of attorneys ultimately may be liable for one another’s professional torts, whether or not they are a legal partnership. Lawyers in de facto partnerships (also known as apparent partnerships or partnerships by estoppel) are subject to claims of vicarious liability just like those in formally constituted partnerships.

Factors considered in determining whether a partnership by estoppel has arisen include: how the group of attorneys hold themselves out to the public in general and to the individual client in particular; how well the group of attorneys maintain their separateness vis-à-vis one another; and generally what efforts they make to avoid confusion about their relationship.

Create autonomy, clarity

The first step in avoiding the creation of de facto partnerships is for all lawyers and firms in the shared space to respect the autonomy of each practice in the office. If the lawyers think of themselves as a single firm, their clients are likely to do the same. And a court is very likely to agree. But, if the lawyers act like the separate entities that they are, they strengthen the argument that they should not be lumped together as one unit.

To this end, do not share confidential client information with officemates who are not part of your firm without first getting consent from the client. Lawyers who don’t respect the autonomy of their separate firms might speak to officemates about a client’s matter without that client’s consent. A single receptionist who opens mail or takes messages for all the various firms in the office is exposed to confidential information from each firm. Papers may be left in shared conference rooms or copy machines. Such confidentiality breaches can lead to the waiver of the attorney/client or the attorney work- product privileges, breach of fiduciary duty claims, or ethical complaints. They also raise the likelihood that the group of attorneys will be found to be a de facto partnership, because the attorneys appear to be treating themselves like one big law firm.

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