Last year, in Platinum Rapid Funding Group, Ltd. v. H D W of Raleigh, Inc., A California-based law firm that leases a virtual office in New York was removed from a case because a New York judge determined the firm didn’t satisfy the requirement of a physical office. Under N.Y. Judiciary Law § 470, New York-licensed attorneys that live out-of-state must maintain an office in-state “for the transaction of law business.” The trial judge based his ruling off the virtual office not having “attorneys or law firm staff” at the location. The lease agreement, which was conveniently executed after the lawsuit commenced, called for “24-hour access to physical office space.”
Courts, especially the appellate courts of New York, are split on whether attorneys at firms without physical offices are un-authorized in their practice of law. However, law firms may be comforted in knowing that a state bar committee has called for the repeal of the law. The committee described the law as an “anachronistic vestige of an era when only residents could be admitted to the New York State Bar.” Even with such recommendation, in 2017, the U.S. Supreme Court declined to hear an appeal that challenged the law’s validity in Schoenefeld v. Schneiderman.
Considerations of a Virtual Firm
While each state differs, most states seem to be flexible in their consideration of what establishes an office. For example, Ohio’s Board of Professional Conduct allows for an office address to be satisfied by a P.O. box, the address of a shared space with lawyers or non-lawyers, or can reflect a home or physical office. Also, Florida allows for virtual offices as long as the firm’s advertising is clear about when the lawyer is available, that the location is for “limited service,” or that the office is a satellite office. Similarly, Oregon and Washington call for firms to abide by the appropriate precautions when sharing office space. Again, states differ, but most are inclined to recognize the changes in the legal landscape.
While the first virtual law firm, Woolley & Co., was established over 20 years ago, some states are weary of the concept. States that aren’t the flexible with their requirements seem to be concerned with the protection of the client. New Hampshire v. Piper outlined common apprehensions such as: competency of attorneys, accessibility to the client, and client confidentiality. The ABA helps curb concerns by providing guidance for firms wishing to operate or operating as a virtual firm.
Establishing a Satellite Office
If your law firm is looking to operate a satellite office, you must ensure that the office is setup correctly to avoid violating rules that pertain to the authorized practice of law and/or office physicality requirements. For example, “the above-mentioned New York ruling cited the absence of attorneys or legal staff as a main issue with the satellite office,” Founder and Co-Chief Executive Officer of FirmVO Aaron Poznanski explained. This recent ruling voices just one of many concerns.
For purposes of addressing apprehensions about physicality requirements, firms should keep at least two considerations in mind. While setting up a satellite office for your law firm, it’s important to note if on-site staff is trained to handle privileged and confidential communications from clients. Additionally, it’s important to determine if the location makes it clear that it’s setup exclusively for attorneys with law-centric signage for visitors and clients alike.
Establishing an Office with FirmVO
There are national, flexible office providers who are adapting to the legal environment and appeasing those concerns. FirmVO, growing New York City-based flexible office space provider, is one of those providers. Poznanski asserts, “We are meticulous in creating our satellite offices so that they are completely ethical and legal. Our office locations and technology can be used to establish a flexible office as a physical or bona fide office because we offer a tailor-made friendly, legal solution.”
Furthermore, FirmVO offers more than just office space. “Not only does FirmVO provide offices for attorneys only, our office staff consists of experienced and trained legal support personnel,” said Poznanski.
FirmVO offers satellite office locations to attorneys in New York City, Boston, District of Columbia, Los Angeles, Beverly Hills and Palo Alto. Locations in Chicago, San Francisco, and Texas will soon be opened in 2019.