Can a lawyer run a closing or escrow department under a trade name (d/b/a), and must the lawyer disclose that the d/b/a is part of the law firm?

Plain-English summary

A solo practitioner planned to create a d/b/a, "[Smith] Escrow Services," to market his services in closing real estate transactions. He asked two questions: first, whether he must disclose the relationship between his law firm and the d/b/a when using the d/b/a on letterhead and advertising; and second, more generally, whether he can operate a closing or escrow department under a d/b/a.

On the first question, the committee applied RPC 7.5(a), which lets a lawyer use a trade name so long as it does not imply a connection with a government agency or with a public or charitable legal-services organization and does not otherwise violate RPC 7.1, the bar on false or misleading communications about the lawyer or the lawyer's services. The committee concluded that failing to disclose the d/b/a's association with the law firm does not appear misleading, so such disclosure does not appear to be required. It cautioned, however, that using the term "escrow" may be misleading if the attorney provides closing services that do not include an escrow function.

On the second question, the committee found it too general to answer specifically, and directed the inquirer to RPC 5.7, which addresses the extent to which a lawyer providing law-related services (such as an escrow function) must comply with the Rules of Professional Conduct. It also pointed the inquirer to Formal Opinion 187 and Informal Opinions 938, 1338, 1364, 1386, 1442, 2053, 2060, and 2151.

In practice

Under this opinion, and under the Washington rules as they stood at the time, a lawyer may market a closing or escrow function under a trade name (d/b/a) and is not required to disclose that the d/b/a belongs to the law firm, provided the name does not imply a government or charitable-legal-services connection and is not otherwise misleading under RPC 7.1. The opinion flags one specific accuracy concern: the word "escrow" may mislead if the services do not actually include an escrow function. It does not resolve whether the lawyer may operate the escrow department itself, directing that broader question to RPC 5.7's treatment of law-related services.

Common questions

Q: Does a lawyer have to disclose that an escrow d/b/a is part of the law firm?

A: The committee concluded that disclosure does not appear to be required, because failing to disclose the d/b/a's association with the firm does not appear misleading under RPC 7.1.

Q: Are there limits on the trade name itself?

A: Yes. Under RPC 7.5(a), the name may not imply a connection with a government agency or a public or charitable legal-services organization and may not otherwise violate RPC 7.1, and the committee cautioned that "escrow" may mislead if there is no escrow function.

Q: Can the lawyer operate a closing or escrow department under the d/b/a?

A: The committee found the second question too general to answer and directed the inquirer to RPC 5.7 (law-related services), Formal Opinion 187, and a list of informal opinions.

Background and rules framework

The opinion interprets Washington RPC 7.5(a) (Model Rule 7.5; trade and firm names) together with RPC 7.1 (Model Rule 7.1; false or misleading communications about the lawyer or the lawyer's services), and points to RPC 5.7 (Model Rule 5.7; responsibilities regarding law-related services) for the broader question of operating an escrow or closing department alongside a law practice. It refers the inquirer to Formal Opinion 187 and a series of informal opinions on law-firm escrow and closing activities.

Citations and references

Rules of Professional Conduct:

• Model Rule 7.5 / Washington RPC 7.5(a) (trade names)
• Model Rule 7.1 / Washington RPC 7.1 (false or misleading communications)
• Model Rule 5.7 / Washington RPC 5.7 (law-related services)

Other opinions cited:

• WSBA Formal Opinion 187 and Informal Opinions 938, 1338, 1364, 1386, 1442, 2053, 2060, 2151 (law-firm escrow and closing activities)

See also

• WA Ethics Op. 2053: Operating an Escrow Business as Part of a Law Practice
• WA Ethics Op. 2135: PLLC Law Firm Trade Name
• WA Ethics Op. 2163: Using 'Group' in a Firm Name

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=1602

Original opinion text

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

Advisory Opinion: 2162
Year Issued: 2007
RPC(s): RPC 7.5(a), 7.1, 5.7
Subject: operation of an escrow department under a separate name (d/b/a), as part of a law firm

The attorney is a solo practitioner who intends to create a d/b/a to assist in marketing his services in closing real estate transactions. The proposed name is “[Smith] Escrow Services.” He presents two questions. The first is whether he must disclose the relationship between his law firm and the d/b/a when using the d/b/a on letterhead, advertising, etc. Second, he asks a more general question about whether he can operate a closing or escrow department under a d/b/a.

The committee opined that RPC 7.5(a) provides that a trade name may be used by a lawyer so long as it does not imply a connection with a government agency or with a public or charitable legal services organization, and does not otherwise violate RPC 7.1. RPC 7.1, in turn, provides that a lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. Failing to disclose the association of the d/b/a with the law firm does not appear to be misleading, thus such disclosure does not appear to be required. We note, however, that the use of the term “escrow” may be misleading if the attorney is providing closing services that do not include an escrow function.

The second question is too general to provide a specific response, but the Inquirer is directed to RPC 5.7, which addresses the extent to which a lawyer providing law related services, such as an escrow function, is required to comply with the Rules of Professional Conduct. Additionally, the Inquirer should review Formal Opinion 187, and Informal Opinions 938, 1338, 1364, 1386, 1442, 2053, 2060 and 2151.