Monday, August 4, 2025
ETHICS COMMITTEE ACTION
Ethics Opinion Adopted
2025 Formal Ethics Opinion 2, Negotiating Licensure Reporting Capability During Mediation
Opinion affirms prohibition on lawyers participating in a settlement agreement that includes a limitation on a party’s or counsel’s ability to report misconduct to the North Carolina State Bar and rules a lawyer serving as a mediator may not assist with or participate in a mediated settlement agreement that includes such a term.
Ethics Committee Actions
At its meeting on July 24, 2025, the Ethics Committee considered a total of five inquiries, including the adopted opinion referenced above. Four inquiries were sent or returned to subcommittee for further study, including an inquiry exploring conflicts of interest for public defender offices, an inquiry addressing whether the Rules of Professional Conduct permit a real property lawyer to refer a client to a law partner’s title insurance business, and a new inquiry exploring the inclusion of non-disparagement clauses in initial fee agreements and fee dispute settlement agreements. Additionally, based on comments received during publication over the prior quarter, the committee sent proposed 2025 FEO 3 (Client Consent to Annual Rate Increase) back to subcommittee for further study.
GRIEVANCECOMMITTEE ACTION
The Grievance Committee considered 511 files this quarter, 461 of which were dismissed (90%).
In addition, the committee authorized the following dispositions:
- Referral of 4 files (involving 3 lawyers) to the DHC
- Referral of 1 lawyer to the Trust Accounting Compliance Program
- Dismissal of 2 files with Letters of Caution
- Dismissal of 18 files with Letters of Warning
- Admonitions in 7 files
- Reprimand in 6 files
- Censure in 1 file
- Dismissal in 6 files
- Reconsideration and dismissal in 2 files
- Continuation of 3 files
RULE AMENDMENTS
Amendments Adopted - Pending Supreme Court Approval
Amendments to the Rules of Professional Conduct
- Rule 1.15-2, General Rules
Amendments remove reference to State Bar Trust Account Compliance Counsel, as that position was eliminated in the recent restructuring of the Trust Account Compliance Department.
Amendments to the Rules Governing Discipline and Disability of Attorneys
- 27 NCAC 01B, Section .0100, Discipline and Disability of Attorneys
- Rule .0125, Notice to Complainant;
- Rule .0127, Imposition of Discipline: Findings of Incapacity or Disability; Notice to Courts
Amendments effectuate recommendation of 2024 legislative committee to eliminate process whereby grievance complainants are notified that a respondent lawyer received private written discipline or a private letter of warning or caution, as this notification allows complainants to publicize what is supposed to be a private outcome.
Amendments to the Rules Governing Continuing Legal Education Requirements
- 27 NCAC 01D, Section .1500, Rule .1520, Requirements for Program Approval
The amendment to the CLE rules requires sponsors to submit approval applications for all online programs, not just on-demand programs. Lawyers would no longer be permitted to submit course applications for any online programs.
Amendments to the Rules Governing the Client Security Fund
- 27 NCAC 01D, Section .1400, Rules Governing the Administration of the Client Security Fund of the North Carolina State Bar
- Rule .1401, Purpose; Definitions
- Rule .1412, Source of Funds
- Rule .1417, Applications for Reimbursement
- Rule .1418, Processing Applications
The revisions submitted by the Client Security Fund Board (1) provide for the CSF to receive funds maintained in attorney trust accounts that are frozen pursuant to an injunction and cannot be identified due to an attorney’s trust accounting deficiencies; (2) allow the Office of Counsel to seek court-ordered disbursement of such unidentifiable funds to the CSF; (3) allow for the CSF to reimburse claimants who suffered a loss occasioned by an attorney’s mismanagement and/or mishandling of funds rather than through dishonesty; and (4) add to the administrative rules a regularly relied upon theory for reimbursing claims: it is dishonest for an attorney to take an advance fee and fail to perform any meaningful legal services on behalf of the client.
Proposed Rule Amendments for Publication
At its meeting on July 25, 2025, the council voted to publish for comment the following proposed rule amendments:
Proposed Amendments to the Rules Governing Admission to the Practice of Law in the State of North Carolina
- The proposed amendments (1) establish a new requirement that general and transfer applicants complete a North Carolina State-Specific Component Examination on Decedents’ Estates and Trusts, effective for applications filed on or after November 15, 2027, and May 1, 2028, respectively; (2) revise fee structures for general and supplemental applications beginning with the July 2028 bar examination; (3) formally recognize the NextGen UBE as part of the Uniform Bar Examination administered in North Carolina with the first administration of the NextGen UBE in North Carolina to occur in July of 2028; (4) create a no-fee admission process for military spouse comity applicants, and clarify application requirements for servicemembers; (5) clarify filing and good standing definitions, including discretion to waive certain certification requirements related to bar dues; and (6) confirm that bar exam answers will not be regraded and provide updated procedures for score disclosure and exam review.
A full-text version of the proposed amendments is available in the Journaland on the State Bar’s website. The Council welcomes your comments on these proposed rule amendments. Comments may be submitted by email to ethicscomments@ncbar.gov or by mail to Peter Bolac, The North Carolina State Bar, PO Box 25908, Raleigh, NC 27611.
APPOINTMENTS
At its meeting on July 25, 2025, the council made the following appointments:
IOLTA Board of Trustees- The council appointed Anna Hamrick and Thomas Nelson to three-year terms and reappointed Alexander C. Dale to a three-yearterm. The council appointed the Hon. John Arrowood to serve a one-year term as chair and Theodore “Ted” Edwards to serve one-yearterm as vice-chair.
Board of Legal Specialization – The council reappointed Julie Beavers and John C. Burcher III to three-year terms. The council reappointed Matthew J. Ladenheim to serve a one-year term as chair and Barbara Morganstern to serve a one-year term as vice-chair.
North Carolina Dispute ResolutionCommission – Pursuant to statute, President Smith reappointed Lauren Quinn to a three-year term.
North Carolina State Bar Foundation – The council appointed Marcia Armstrong to the board to complete the unexpired portion of Bob Wicker’s term, which expires on January 31, 2027.
Lawyer Assistance Program (LAP) - The council appointed Paul Derrick to the board to complete the unexpired portion of Crawford Cleveland’s term, which expires on January 31, 2026.
UPCOMING APPOINTMENTS: SUBMIT YOUR INTEREST FORM
Anyone interested in being appointed to serve on any of the State Bar’s boards or commissions should complete the “Boards and Commissions Interest Form”. The deadline for completion of the interest form is October 1, 2025. Your information will be included in the agenda materials for the quarterly meeting of the council in October 2025.
The council will make the following appointments at its October quarterly business meeting:
BOARD OF CONTINUING LEGAL EDUCATION (three appointments; three-year terms) – There are three appointments to be made. Robert A. Ponton Jr., Addie M. Harris Rawls, and Syrena N. Williams are eligible for reappointment. The rules governing the Board of Continuing Legal Education require the Council to appoint the board’s chair and vice-chair annually.
The Board of Continuing Legal Education (CLE) is a nine-member board composed of North Carolina licensed attorneys. The board establishes policy related to the execution of the CLE program’s mission and is responsible for oversight of the program.
BOARD OF LAW EXAMINERS (four appointments; three-year terms) – There are four appointments to be made. Athena Fox Brooks, Shelley Blake Curran, Sherri Wilson Elliott, and Michael Greene are eligible for reappointment.
The 11 members of the North Carolina Board of Law Examiners are appointed by the State Bar Council. The board examines applicants and establishes rules and regulations for admission to the North Carolina State Bar. The board’s objective is to ensure that all persons seeking admission to practice law in North Carolina possess the requisite competency and qualifications of character and fitness. Board members review bar examination questions; conduct character and fitness and comity hearings; supervise the bar examinations; and grade the examinations. Additionally, the board engages in periodic review of methods used in the examination and grading process. A board member donates an average of 35-45 days to service each year.
CLIENT SECURITY FUND BOARD OF TRUSTEES (one appointment; five-year term) – There is one appointment to be made. Erika D. Jones, the current chair, is not eligible for reappointment. The rules governing the Client Security Fund require the Council to appoint the board’s chair and vice-chair annually.
The Client Security Fund was established by the North Carolina Supreme Court in 1984 to reimburse clients who have suffered financial loss as the result of dishonest conduct of lawyers engaged in the private practice of law in North Carolina. The fund is administered by a board of trustees composed of four North Carolina lawyers and one public member. The trustees are appointed by the North Carolina State Bar Council, and each serves a five-year term.
BOARD OF PARALEGAL CERTIFICATION (three appointments; three-year terms) – There are three appointments to be made. Carrie J. Marshall (paralegal member) and Precious Vines-Harris (lawyer member) are eligible for reappointment. Benita G. Powell, the current chair, is not eligible for reappointment. The rules governing the Board of Paralegal Certification require the Council to appoint the board’s chair and vice-chair annually.
The Board of Paralegal Certification is a nine-member board composed of five North Carolina licensed attorneys (one of whom must be a paralegal educator) and four North Carolina certified paralegals. The board establishes policy related to the execution of the paralegal certification program and is responsible for the oversight of the operation of the program subject to the statutes governing the practice of law, the authority of the council, and the rules of the board. The paralegal certification program assists in the delivery of competent representation to the public by identifying individuals who are qualified by education and training and have demonstrated knowledge, skill, and proficiency to perform substantive legal work under the direction and supervision of a licensed lawyer. The board usually meets four times a year.
Filed Under: General News
