In Kentucky, under what conditions may a lawyer participate in a for-profit, prepaid legal services plan?

Plain-English summary

Responding to a variety of inquiries prompted by advertisements for prepaid legal services plans, the Committee was asked under what conditions a Kentucky lawyer may participate in a for-profit prepaid plan. It concluded a lawyer may participate so long as the plan complies with SCR 3.475 (furnishing legal services pursuant to a prepaid plan), Rules of Professional Conduct 5.4, 5.5, and 8.3, and SCR 3.135 (advertisement of legal services, now Rules 7.01-7.60). It pointed to ABA Op. 87-355 (1987) for detailed guidance and emphasized that the Committee does not review or approve plans; participants bear responsibility for ensuring a plan conforms to the rules.

On advertising and solicitation, the Committee agreed with the ABA that it would be improper solicitation for a lawyer to participate in a plan whose sponsor engages a sales force that solicits members by telephone or in person, and that the plan's advertising must not be false or misleading; questions or complaints about specific advertising should go to Bar Counsel or the Advertising Commission. The Committee added that it would decline to act on requests from plan sponsors or participants for "approval" or compliance advice, and on complaints or demands for "enforcement," because it cannot serve as legal counsel or take on regulatory and disciplinary functions.

Currency note

This opinion was issued in 1991, before the substantial 2009 revisions to Kentucky's Rules of Professional Conduct (SCR 3.130) and refers to advertising rules (SCR 3.135) since recast as Rules 7.01-7.60. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against the current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a Kentucky lawyer join a for-profit prepaid legal services plan?

A: Yes, conditionally. The opinion concluded a lawyer may participate so long as the plan complies with SCR 3.475, Rules 5.4, 5.5, and 8.3, and the advertising rules.

Q: Does the bar approve these plans?

A: No. The opinion stated the Committee does not review or approve plans, and participating lawyers bear responsibility for ensuring the plan conforms to the rules.

Q: What kind of solicitation makes a plan improper to join?

A: The opinion concluded it would be improper solicitation to participate in a plan whose sponsor uses a sales force to solicit members by telephone or in person, and that the plan's advertising must not be false or misleading.

Background and rules framework

The opinion applies KRPC 5.4 (professional independence; Model Rule 5.4), KRPC 5.5 (unauthorized practice; Model Rule 5.5), and the misconduct rule then numbered 8.3 (now 8.4; Model Rule 8.4), together with the Supreme Court rules on prepaid plans (SCR 3.475) and legal-services advertising (SCR 3.135, now Rules 7.01-7.60), to set the conditions for lawyer participation in a prepaid plan.

Citations and references

Rules of Professional Conduct:

• MR 5.4 / KRPC 5.4 (professional independence of a lawyer)
• MR 5.5 / KRPC 5.5 (unauthorized practice of law)
• MR 8.4 / KRPC 8.4 (misconduct; cited as 8.3)

Court rules:

• SCR 3.475 (furnishing legal services pursuant to a prepaid plan)
• SCR 3.135 (advertisement of legal services; now Rules 7.01-7.60)

Other opinions cited:

• ABA Op. 87-355 (1987): prepaid legal services plans

See also

• KBA Ethics Op. E-344: Cooperative Advertising
• KBA Ethics Op. E-358: Union Counsel Payments
• AL Ethics Op. 1991-43: For-Profit Referral Hotline

Source

• Landing page: https://kybar.org/For-Members/Rules-Ethics-Information/Ethics-Opinions
• Original PDF: https://kybar.org/Portals/0/Admin/Ethics%20Opinions/KBA_E-346.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

KENTUCKY BAR ASSOCIATION
Ethics Opinion KBA E-346
Issued: March 1991

The Rules of Professional Conduct and other Supreme Court Rules affecting lawyers are
amended periodically. Lawyers should consult the current version SCR 3.47 and SCR
3.130 (available at http://www.kybar.org), before relying on this opinion.

Question:

Under what conditions may a Kentucky lawyer participate in a For-profit, Pre-paid
Legal Service Plan?

Answer:

A lawyer may participate in such a plan so long as the plan is operated in
compliance with SCR 3.475 (Furnishing Legal Services Pursuant to Pre-paid Legal
Services Plan), Rules of Professional Conduct 5.4, 5.5, 8.3 and SCR 3.135 (now
Rules 7.01-7.60) (Advertisement of Legal Services).

References:

SCRs 3.475 and 3.135; Rules of Professional Conduct, 5.4, 5.5, 8.3, and 8.4; ABA
Op. 87-355 (1987).
OPINION

Numerous advertisements for prepaid legal services plans have appeared in Kentucky, and
the Committee has received a variety of inquiries. The Committee does not review and approve
plans, and those who choose to participate in such plans bear the responsibility for insuring that the
operation of such plans conform to the above rules. Detailed guidance is provided in ABA Op.
87-355 (1987).
Regarding advertising and solicitation, we agree with the ABA position "that it would
constitute improper solicitation for a lawyer to participate in a plan in which the plan sponsor
engages a sales force that would solicit members by telephone or in person." Furthermore, "the
plans advertising must not be false or misleading." Questions or complaints about specific
advertising should be directed to Bar Counsel or the Advertising Commission.
The Committee will decline to act on (l) requests from plan sponsors and participants for
"approval" and other legal advice regarding compliance and (2) complaints or other demands for
"enforcement." The Committee cannot serve as legal counsel and cannot take on regulatory and
disciplinary functions in this area.

Note to Reader
This ethics opinion has been formally adopted by the Board of Governors of the Kentucky
Bar Association under the provisions of Kentucky Supreme Court Rule 3.530 (or its predecessor
rule). The Rule provides that formal opinions are advisory only.