Hidden risks of law firms

Risks and prevention in the management of law firms

With the continuous progress of the construction of the rule of law in China, there are more and more laws and regulations binding lawyers and law firms, which make lawyers and law firms face more and more risks in their practice. If lawyers and law firms want to develop healthily and effectively under the dual control of lawyers associations and judicial administrative organs, they must undoubtedly understand the risks implied by various rules and regulations and learn how to prevent them. As a lawyer's practice organization, law firm is a supplement to the interests of lawyers to some extent. However, because the law firm is the direct manager of lawyers and the undertaker of responsibilities, the interests of lawyers and law firms conflict to a certain extent. Then, in the process of management, law firms should not only consider the direct risks brought by various rules and regulations, but also consider the indirect risks brought by various rules and regulations to lawyers' personal practice norms.

In order to effectively foresee the possible risks in the management of law firms and prevent the occurrence of risks by formulating a standardized management system, this paper will elaborate the risks and preventive measures in the management of law firms from three aspects:

First, the risks brought by lawyers' illegal practice to law firms.

Lawyers must provide legal services in the name of law firms, and lawyers are prohibited from practicing in China in their own names. Therefore, the practice of lawyers is largely equivalent to the practice of law firms. Then, the illegal practice of lawyers will inevitably make the law firm suffer economic losses, reputation losses and other losses. According to the "People's Republic of China (PRC) Lawyers Law", "Measures for Punishment of Illegal Acts of Lawyers and Law Firms" and other rules and regulations, illegal acts in lawyers' practice can be divided into three categories:

The first category: administrative punishment is "given a warning, can be fined up to 5000 yuan;" Illegal income, confiscate the illegal income; If the circumstances are serious, the punishment for stopping practicing for less than three months shall be given. " Illegal behavior.

1. Illegal acts of practicing law in two or more law firms at the same time or engaging in legal services as non-lawyers: (1) practicing law in other law firms or social legal service institutions at the same time; (2) Undertaking business in the name of the lawyer of the law firm to be changed before being approved to change the practice institution, or undertaking business in the name of the lawyer of the original law firm after being approved to change.

2. Illegal acts of contracting business by improper means: (1) misleading, luring, threatening or making false promises to contract business; (2) Undertaking business by paying referral fees, giving kickbacks or promising to provide benefits; (3) Undertaking business by means of untrue and inappropriate publicity to oneself and the law firm, or defaming the reputation of other lawyers and law firms; (four) to set up offices and reception rooms outside the residence of the law firm to undertake business.

3. Acting as an agent for both parties in the same case, or acting as an agent for legal affairs that have conflicts of interest with himself or his close relatives: (1) Acting as an agent or providing relevant legal services for parties with conflicts of interest in the same civil litigation, administrative litigation or non-litigation legal affairs; (2) Acting as a defender or agent for the defendant and the victim at the same time in the same criminal case, or acting as a defender for two or more criminal suspects and defendants at the same time; (3) Providing legal services to the parties who have conflicts of interest with the consulting unit during their tenure as legal advisers; (4) Lawyers who have served as judges and prosecutors act as agents and defenders to undertake cases handled by the original courts and procuratorates; (5) A lawyer who has served as an arbitrator or is still serving as an arbitrator, acting as an agent to undertake the cases handled by the arbitration institution where he previously served or currently serves.

4. Illegal acts of serving as an agent ad litem or defender within two years after leaving the people's court or people's procuratorate: lawyers who have served as judges and prosecutors, serving as agents ad litem or defenders within two years after leaving the people's court or people's procuratorate, or participating in litigation legal affairs undertaken by their law firms in other ways.

5. Illegal acts of refusing to perform legal aid obligations: (1) refusing to accept legal aid cases assigned by law firms or legal aid agencies without justifiable reasons; (two) after accepting the assignment, slack off or stop performing the duties of legal aid without authorization.

The second category: the administrative penalty is "given a warning and may be fined up to 10,000 yuan;" Illegal income, confiscate the illegal income; If the circumstances are serious, he shall be punished for stopping practicing for more than three months and less than six months.

1. Illegal acts of accepting entrustment, charging fees, accepting property or other benefits from clients without permission: (1) Accepting entrustment and undertaking legal affairs without permission in violation of uniform entrustment regulations or during the period of being sentenced to stop practicing; (two) in violation of the provisions on the administration of fees, privately collect, use or occupy the lawyer's service fees and the lawyer's travel expenses for handling cases in different places; (3) Asking the client for other fees, property or other benefits in addition to the uniform fees charged by the law firm; (4) Asking for fees from legal aid recipients or accepting their property or other benefits.

2. After accepting the entrustment, under any of the following circumstances, he refuses to defend or represent, and does not appear in court on time to participate in litigation or arbitration: (1) the entrusted matter is illegal, or the client uses the legal services provided by lawyers to engage in illegal activities; (2) The client intentionally conceals important facts related to the case or provides false or forged evidence materials; (3) The client fails to perform the obligations stipulated in the entrustment contract; (4) A lawyer suffers from a serious illness or is subject to administrative punishment for stopping practicing; (5) Other personnel who can refuse to defend or represent according to law.

4. Illegal acts of obtaining the disputed rights and interests of the parties by providing legal services: (1) Obtaining the disputed property and rights and interests of the parties with others by means of inducement, deception, coercion or extortion; (2) Instructing or inducing the parties to transfer, sell or lease the disputed property and rights to others, and obtain benefits from them.

5. Illegal act of revealing business secrets or personal privacy: A lawyer discloses or disseminates business secrets, personal privacy or other information of the client or other parties that he knows in his practice or is unwilling to disclose during or after handling a case without the authorization or consent of the client or other parties.

The third category: the administrative penalty is "stop practicing for more than six months and less than one year, and may be fined less than 50 thousand yuan;" Illegal income, confiscate the illegal income; If the circumstances are serious, his lawyer's practice certificate shall be revoked; If a crime is constituted, criminal responsibility shall be investigated according to law.

1. Meeting with judges, prosecutors, arbitrators and other relevant staff members in violation of regulations, or otherwise affecting the handling of cases according to law: (1) Meeting with judges, prosecutors, arbitrators or other relevant staff members in non-working hours and non-working places for the purpose of influencing the handling of cases while undertaking agency and defense business; (two) the use of special relations with judges, prosecutors, arbitrators or other relevant staff, affecting the handling of cases according to law; (three) distorted, untrue and misleading propaganda or slander the reputation of the relevant case-handling organs and staff and the other party, which affects the handling of cases according to law.

2. Bribing judges, prosecutors, arbitrators and other relevant staff members, introducing bribes or instigating or inducing the parties to pay bribes: (1) Taking advantage of the opportunity of holding weddings, funerals and festive events for judges, prosecutors, arbitrators and other case-handling staff or their close relatives to pay bribes by giving gifts, property and securities; (2) Paying bribes to judges, prosecutors, arbitrators and other staff members by decorating houses, reimbursing personal expenses, subsidizing tourism and entertainment, etc.; (3) bribing judges, prosecutors, arbitrators and other staff members by providing means of transportation, communication tools, housing or other articles; (4) bribing or introducing bribes directly to judges, prosecutors, arbitrators and other staff members, or instigating or inducing the parties to pay bribes for the purpose of influencing the outcome of handling cases.

(1) Concealing the real situation from the judicial administrative organ during inspection and supervision, refusing to provide or providing false or untrue materials, or concealing, destroying or forging evidence materials; (2) Providing false, untrue, forged materials or committing other fraudulent acts in participating in the annual assessment, practice evaluation and appraisal of lawyers; (three) providing false, untrue or forged materials when applying for changing the practice institution and going through the formalities of termination and cancellation of practice.

4. Deliberately providing false evidence or threatening or inducing others to provide false evidence, which hinders the other party from obtaining evidence according to law: (1) Deliberately submitting false evidence to a judicial organ, an administrative organ or an arbitration institution, or instigating, threatening or inducing others to provide false evidence; (2) instigating or helping clients or others to forge, conceal or destroy evidence, instigating or helping criminal suspects and defendants to collude in confession, threatening or inducing witnesses not to testify or commit perjury; (3) obstructing the other party and its agents and defenders from obtaining evidence according to law, or preventing others from providing evidence to the case-handling organ or the other party.

5. Illegal acts of accepting property or other benefits from the other party, maliciously colluding with the other party or a third party, and infringing on the rights and interests of the client: (1) providing the other party or a third party with information or evidential materials that are not conducive to the client; (2) Malicious collusion or secret cooperation with the other party or a third party, which hinders the client from exercising his rights according to law; (3) accepting property or other benefits from the other party, deliberately delaying, slacking off or failing to perform the duties of agency and defense according to law, thus causing adverse effects and losses to the client and the entrusted matters.

6. Illegal acts that disturb the order of courts and arbitration tribunals and interfere with the normal conduct of litigation and arbitration activities: (1) publishing or instigating or inducing clients to publish statements that disturb the normal conduct of litigation and arbitration activities of courts and arbitration tribunals; (two) to prevent the client or other participants in the proceedings from appearing in court, so that the litigation and arbitration activities can not be carried out normally; (3) Inciting or instructing others to disturb the order of the court or arbitration tribunal; (4) refusing to appear in court to defend or represent, to sign judicial documents or to sign opinions on relevant litigation documents without justifiable reasons.

7. Illegal acts of inciting and instigating parties to take illegal means such as disturbing public order and endangering public security to solve disputes: (1) Inciting and instigating parties to take illegal means such as illegal assembly, procession, gathering people to disturb public order and traffic order, containing and attacking state organs, obstructing state organs and their staff from performing their duties according to law, and resisting law enforcement activities or the execution of judgments; (two) using the media or other means to incite or instigate the parties to interfere with the normal conduct of litigation, arbitration and administrative law enforcement activities in a way that disturbs public order and endangers public safety.

8. Illegal acts of publishing statements that endanger national security, maliciously slander others and seriously disrupt court order: (1) publishing and disseminating statements that endanger national security, maliciously slander judges, prosecutors, arbitrators, other parties, third parties and seriously disrupt court order during the period of undertaking agency and defense business; (2) publishing, producing or disseminating speech, information or audio-visual products that endanger national security, or supporting, participating in or implementing activities that endanger national security during the practice.

9. Violation of confidentiality obligations, intentionally or negligently revealing state secrets known in practice.

Second, the risks brought by illegal practice of law firms.

The illegal practice of law firms will directly lead to the losses of law firms. According to China's "Lawyers Law" and related laws, if a law firm is under any of the following circumstances, the judicial administrative organ shall give a warning, suspend business for rectification for more than one month and less than six months, and may also impose a fine of less than 100,000 yuan; Illegal income, confiscate the illegal income; If the circumstances are particularly serious, the practice license of the law firm shall be revoked.

1. Illegal acts of accepting entrustment and charging fees in violation of regulations: (1) Not accepting entrustment in the name of a law firm, illegally charging lawyers' service fees and lawyers' travel expenses for handling cases in different places, and failing to issue a valid fee voucher to the client; (2) Asking or accepting fees, property or other benefits from the client other than those stipulated or agreed in the contract; (3) conniving or letting our lawyers accept entrustment, collect fees and accept property or other benefits from clients.

2. Illegal acts of changing the name, person in charge, articles of association, partnership agreement, domicile and partners of a law firm in violation of legal procedures: (1) Failing to go through the examination and approval or filing of changes in the name, person in charge, articles of association, partnership agreement, domicile, partners and organizational form of a law firm in accordance with the prescribed procedures; (2) Failing to develop partners, withdraw from the partnership, withdraw from the partnership or elect the person in charge of the law firm according to the prescribed conditions and procedures; (3) Failing to handle the division, merger, branch establishment, termination, liquidation or cancellation of the law firm in accordance with the prescribed procedures.

Illegal acts of engaging in business activities other than legal services: (1) setting up an enterprise by means of sole proprietorship, joint venture with others or entrusted shareholding, and hiring a lawyer as the legal representative or general manager of the enterprise; (two) engaged in intermediary services or other business activities unrelated to legal services.

4. Illegal acts of contracting business by slandering other law firms and lawyers or paying referral fees: Law firms engage in or connive at or let their lawyers undertake business by improper means.

5. Illegal acts of accepting cases with conflicts of interest in violation of regulations: (1) Appointing lawyers of our firm to act as plaintiffs or defendants' agents in the same litigation case, or defendants' defenders or victims' agents in the same criminal case; (2) Failing to examine the conflicts of interest in the entrusted matters in accordance with the provisions, and at the same time or successively appointing lawyers as agents or providing relevant legal services for the parties involved in non-litigation legal affairs with conflicts of interest; (three) knowing that lawyers and their close relatives have conflicts of interest with the entrusted matters, they still entrust lawyers as agents, defenders or provide relevant legal services; (4) conniving at or letting our lawyers commit the illegal acts stipulated in Article 7 of these Measures.

6. Illegal acts of refusing to perform legal aid obligations: (1) refusing to accept legal aid cases assigned by legal aid agencies without justifiable reasons; (two) after accepting the assignment, failing to arrange the lawyers of this firm to undertake legal aid cases in time or refusing to provide conditions and convenience for handling legal aid cases; (3) conniving at or letting our lawyers commit the illegal acts stipulated in Article 9 of these Measures.

(1) The judicial administrative department intentionally conceals the real situation, refuses to provide relevant materials or provides false or false materials, or conceals, destroys or forges evidence materials when conducting inspection and supervision; (2) Providing false, untrue or forged materials or committing other fraudulent acts in the annual inspection and evaluation, practice evaluation and excellent evaluation of law firms; (3) providing false, untrue or forged certification materials or committing other fraudulent acts in the process of handling major matters such as the change, establishment of branches, division, merger or termination, liquidation or cancellation of law firms.

8. Negligence in the management of lawyers in this firm, resulting in serious consequences: (1) Failure to establish and improve the internal management system as required, lax and chaotic daily management, resulting in the failure of the law firm to operate normally; (2) Failing to effectively supervise lawyers' practice activities as required, or conniving, shielding or protecting lawyers from engaging in illegal and disciplinary activities, thus causing serious consequences; (3) conniving or letting lawyers continue to practice during the period when the firm is ordered to suspend business for rectification or when the lawyer is sentenced to stop practicing; (four) failing to accept the annual inspection and assessment according to the provisions, or being assessed as "unqualified" after the annual inspection and assessment; (five) failing to establish a labor contract system in accordance with the provisions, and failing to apply for unemployment, pension, medical care and other social insurance for hiring lawyers and auxiliary personnel according to law; (six) other illegal acts, resulting in serious consequences.

Three, standardize the management system of law firms, to prevent practice risks.

In order to effectively avoid the risks and losses caused by lawyers and law firms' illegal practice, law firms should establish and improve internal management systems such as practice management and strengthen the supervision of their lawyers' practice in accordance with the Lawyers Law of People's Republic of China (PRC) and relevant laws, regulations, rules and industry norms.

1. Establish a perfect principal-agent system and strengthen the review of conflicts of interest.

When a lawyer undertakes business, the law firm uniformly accepts the entrustment and signs a written entrustment contract with the client.

When accepting business, a law firm shall conduct a conflict of interest review, and shall not illegally accept business with conflict of interest with the business undertaken by the firm and its clients.

By establishing a special examination and approval system for accepting cases, we will strictly examine whether there is any situation stipulated in the "illegal act of accepting cases with conflicts of interest" when our lawyers undertake business, and effectively avoid the risks brought by violating relevant regulations.

2. Establish and improve the financial management system, charge fees uniformly and issue effective invoices.

Law firms shall collect fees in accordance with relevant regulations, establish and improve the management system of fees, collect fees for lawyers' services in strict accordance with the government reference price, and promptly investigate and deal with reports and complaints about illegal fees; Establish and improve the financial management system, establish and implement a reasonable distribution system and incentive mechanism; Pay taxes according to law; Shall not engage in business activities other than legal services.

3. Strict management systems such as official seals and practice licenses of law firms.

Before the official letter and letter of introduction of the law firm are stamped and issued, lawyers should be required to fill in the relevant contents, and after checking that the case has been accepted, they should be registered, stamped and issued;

When lawyers issue important legal documents such as lawyers' letters and legal opinions in the name of law firms, they must set up effective review procedures: legal documents with simple content and uncontroversial content can be issued after being signed and confirmed by the handling lawyer, registered and sealed; Legal documents that are more complicated and controversial must be submitted for collective discussion, and can only be registered, sealed and issued after being examined and confirmed by the director or business director of the law firm. Prevent lawyer Fan from accepting entrustment privately and making mistakes in his work.

A law firm shall properly keep and use its practice license according to law, and shall not alter, lend or lease it.

4. Establish and improve the uniform file format of law firms to facilitate standardized management.

All kinds of format documents such as agency contracts and power of attorney signed by law firms and clients should have a unified format, and the format documents should remind clients of possible legal risks in litigation or non-litigation cases and inform them of their rights and obligations; In terms of procedure, we should also establish a list of materials received from the client and a list of materials served to the client, so as to facilitate the better cooperation between the law firm and the client, avoid unnecessary legal conflicts, and inform the client of the progress of the case in time by writing a lawyer's work log. The use of these normative documents not only protects the interests of clients, but also invisibly strengthens the management of lawyers by law firms, thus reducing the number of times lawyers give lawyers in their practice.

5. Strengthen the file management system of law firms.

A law firm shall establish and improve the file management system in accordance with the provisions, timely file the case files and related materials for undertaking business, and keep them properly.

Lawyer's business file is a true record of lawyer's business activities and reflects the basic work of lawyers. According to the business files, the quality of lawyers' handling cases can be reflected, and the development and utilization of lawyers' business files will play a positive role in guiding lawyers to handle cases and guiding law firms to develop in a healthy direction.

6 to strengthen the professional ethics and practice discipline education of lawyers in this firm, and guide lawyers to practice according to law.

Law firms should strengthen the education of lawyers' professional ethics and practice discipline, organize business study and experience exchange activities, guide lawyers to practice according to law, fulfill their legal aid obligations, establish a collective research report system for undertaking major and difficult cases, supervise lawyers' compliance with laws, regulations and rules in their practice activities, and correct problems in time when found. In order to improve lawyers' handling ability and professional ethics, and reduce the risks brought by lawyers' practice to law firms.

7. Establish a customer return visit system.

The client is the basis of lawyers and law firms' practice activities and the source of basic rights and obligations. Clients need lawyers to provide high-quality and efficient legal services to safeguard their rights and interests, and lawyers also need to provide high-quality and efficient legal services for clients to survive and develop. The two complement and depend on each other.

Establishing and perfecting the client's return visit system can not only timely communicate the contradictions and disputes between lawyers and clients, but also take timely measures to solve them; We can also improve the professional level and service quality of lawyers through the feedback from clients on the service quality of lawyers, so that lawyers and law firms can gain better reputation and case sources while winning the recognition of clients.

During the return visit, we should also pay attention to the advantages, market positioning, competitive means and development trend of competitors, and make suggestions for customers to ensure that the return visit is effective.

8. Actively promote the specialization of lawyers in law firms to prevent practice risks.

With the continuous development of market economy, social demand not only requires lawyers to practice professionally, but also requires specialized division of labor and cooperative management of law firms. Law firms should set up different professional departments and work teams according to lawyers' personal characteristics and professional expertise, allocate legal affairs according to lawyers' professional expertise rather than the source of cases, and arrange lawyers with relevant professional expertise to complete cases. Carrying out professional division of labor among lawyers in law firms can effectively improve work efficiency, ensure the quality of legal services and prevent lawyers from practicing risks.

9. Actively improve the external practice environment of lawyers.

Law firms can gradually expand their social influence by developing their business and serving as legal advisers to government agencies. Lawyers in law firms can become deputies to people's congresses at all levels or members of the Chinese People's Political Consultative Conference (CPPCC) by running for election, so as to enhance their ability to participate in and discuss state affairs. Through this platform, lawyers can actively put forward opinions and suggestions to improve the practice environment of lawyers, thus effectively avoiding or reducing the risks of lawyers and law firms, thus effectively improving the quality of lawyers' work and promoting the steady development of law firms.