Letter to Governor Hochul urging repeal of Judiciary Law 470 and physical office requirement for New York admitted lawyers

The Honorable Kathy Hochul
Governor of the State of New York
Executive Chamber
New York State Capitol Building
Albany, NY 12224

Re: Urging Enactment of A.2218 (Weprin)/S.3261 (Holyman-Sigal), repealing Judiciary Law § 470

Dear Governor Hochul:

We are writing to urge you to sign A.2218/S.3261 into law so that Judiciary Law § 470 can be repealed. Judiciary Law § 470 states:

A person, regularly admitted to practice as an attorney and counsellor, in the courts of record of this state, whose office for the transaction of law business is within the state, may practice as such attorney or counsellor, although he resides in an adjoining state.

Under this statute, attorneys licensed in New York who maintain physical offices in New York may practice in the State even if they are residents of a distant state or foreign country. At the time of its enactment, the logic behind the rule was that it helped ensure personal service on a nonresident attorney. However, the Court of Appeals has acknowledged there are enough measures already in place outside of Judiciary Law § 470 to ensure proper service on a nonresident attorney. Regardless, Judiciary Law § 470 has been found to be constitutional, and a nonresident attorney without a physical New York office address is currently in violation of the above-referenced law. It is also worth noting upfront that lawyers who are admitted to the New York federal courts have successfully practiced in those courts without maintaining a brick-and-mortar office in New York.  There is no reason why New York State Courts should be different.

We are pleased that the Legislature has agreed that the time has come to repeal Judiciary Law 470. This is the conclusion reached by both the New York State Bar Association and the City Bar.

There are three reasons for an outright repeal of the law:

(1) There are already various established methods in place to ensure proper service on a nonresident attorney. Specifically, they may be properly served under CPLR §§ 2103(b), 313, 301, and 302. The clerk of the relevant Appellate Division may also receive service for a nonresident attorney. These forms of service render Judiciary Law § 470 unnecessary.

(2) The law continues to foster procedural difficulties and delays in situations where a non-compliant attorney may be prevented from filing a case or removed from a pending matter increasing client costs and anxiety. Although the Court of Appeals clarified that courts can no longer conclude that a non-compliant lawyer renders a complaint void when filed a draconian result which had effectively barred clients from filing a new complaint when the statute of limitations had expired a party must still cure the statutory violation with either the appearance of compliant counsel or an application for admission pro hac vice by appropriate counsel.[1] In these situations, a court may decide to adjourn the matter; however, it may be very difficult for a client to find substitute counsel in cases where the litigation is too far advanced. If neither compliance nor substitution of counsel is possible, the client may be forced to proceed pro se, severely compromising their position, delaying progress of the litigation, and increasing the burden on judicial resources.[2] Regardless of the procedural setting, Judiciary Law § 470 challenges cause clients unnecessary delays, expense, and anxiety, and do not move cases forward.

(3) Third, before the COVID-19 pandemic and resulting economic crises, the requirement of maintaining a physical office address was unnecessarily inconvenient and expensive for many nonresident attorneys a burden in terms of rent, other associated maintenance fees, and service charges. Now, in the new normal of hybrid or entirely remote work environments, office spaces are going unused and have proven to be unnecessary for lawyers to engage with their clients. Regardless of where a lawyer resides, remote work has become a counter-inflationary measure that encourages lawyers to not increase their rates. Lowering overhead expenses enables lawyers to lower rates (or not raise them). Recent reports indicate that solo and small firm practitioners termed People Law lawyers (as opposed to Big Law lawyers) — have held off on raising their rates for many years and do not collect or even bill for all of the hours they work on their clients matters.[3] The requirement of securing an unnecessary brick-and-mortar presence in New York exacerbates the situation, making it even more likely that non-resident People Law lawyers must raise their rates, even though their inclination may be to do otherwise, in order to remain competitive and accessible to clients with fewer financial resources. Repealing § 470 would help lawyers keep their rates lower and increase access to justice for all middle class and moderate means constituents, whether individuals or the vast number of underserved small businesses.

Given the decrease in use of traditional offices, Judiciary Law § 470’s contemporary restrictions on the use of virtual offices are as unnecessary as they are far removed from the problems and solutions contemplated when the law was enacted in 1862. Indeed, as small businesses continue to struggle with the uncertainty of a post-pandemic economy and inflation, many solo and small firm practitioners are not renewing their existing leases. The law forecloses nonresident lawyers from the expanding use of cost-efficient, virtual workspaces, closing off those workspaces from the benefit of another lucrative market segment and helping that market segment survive in this uncertain economy and continue to contribute critical tax revenues. The overhead costs associated with maintaining a physical office address are a needless expense, and having a physical presence is neither a determining factor of successful or professional representation nor necessary to effectuate service upon a nonresident New York licensed attorney. In this new normal, the focus must be on increasing the ability for all New York-licensed lawyers in good standing to help meet the tremendous legal needs of New Yorkers. Dismantling the outdated, artificial and now pointless barrier erected by Judiciary Law § 470 will help more New York-licensed lawyers in good standing do just that.

For these reasons, we urge the enactment of A.2218/S.3261 into law and thank you for your consideration.

Respectfully,

Susan J. Kohlmann, President
New York City Bar Association

Joseph F. Tremiti, Chair
Legal Referral Service Committee

Anne Wolfson, Outgoing Chair
Adam N. Weissman, Incoming Chair
Small Law Firm Committee

Cc: Senator Brad Hoylman-Sigal
Assembly Member David Weprin