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RULES OF THE SUPREME COURT OF THE STATE OF NEW HAMPSHIRE

ADMINISTRATIVE RULES 35 TO 59

  RULE 41.  LIMITED LIABILITY ENTITIES 

    (1)  Definitions.  The following terms used in this rule shall have the meanings set forth below:

        (a)  "Limited liability entity" shall mean a professional corporation, a professional limited liability company, or a limited liability partnership, that engages in the practice of law in the State of New Hampshire and which is organized under the laws of any state or the District of Columbia which permits a limited liability entity to be engaged in the practice of law.

        (b)  "Owner" shall mean a shareholder of a professional corporation, a member of a professional limited liability company, or a partner of a limited liability partnership.

        (c)  "Manager" shall mean an individual who is licensed to practice law in this state or who is duly licensed by the licensing authority of a state or territory of the United States or the District of Columbia and who is named as a manager of a professional limited liability company in or designated as a manager of a professional limited liability company pursuant to a professional limited liability company agreement or similar instrument under which the professional limited liability company is formed.

    (2)  Applicable Law.  The provisions of the laws of this state shall be applicable to attorneys practicing law in this state, subject to the terms and conditions of this rule.  Nothing in this rule is to be construed to permit a limited liability entity to practice law in New Hampshire if said practice is prohibited by New Hampshire statute. 

    (3)  Shareholders, Members, Managers, Officers, Directors, Employees.  In addition to other provisions required by law, each limited liability entity shall assure compliance with the following requirements:

        (a)  All owners shall be persons who are duly licensed by this court to practice law in this state, or who are duly licensed by the licensing authority of a state or territory of the United States or the District of Columbia.

        (b)  All owners shall be in good standing before this court or before the licensing authority of the jurisdiction(s) in which they are actively engaged in the practice of law.

        (c)  All owners shall own their shares or other ownership interests in their own right.

        (d)  All owners shall be persons who, except for temporary absence due to illness or accident, time spent in the Armed Services of the United States, vacations and leaves of absence not to exceed two years, are actively engaged in the practice of law with the limited liability entity, in this state or in another jurisdiction in which they have been admitted to practice.

        (e)  Any owner who ceases to be eligible to be an owner and the executor, administrator, or other legal representative of a deceased or incapacitated owner shall be required to dispose of that owner's shares or other ownership interest as soon as reasonably possible, either to the limited liability entity or to an individual duly qualified to be an owner of the limited liability entity.

        (f)  All owners and managers of and attorneys employed by a limited liability entity shall by being licensed to practice law in this state, be subject to and bound by the provisions of this rule, including, without limitation, paragraph (10) hereof.

        (g)  All directors and officers of a professional corporation and all members, managers and officers of a professional limited liability company, as the case may be, shall be owners.

        (h)  No owner or attorney employed by a limited liability entity shall be an owner, director, officer, member or manager of more than one limited liability entity; provided, however, that an attorney who is acting as the fiduciary representative of the estate of an attorney may hold the stock or other interest of the attorney in another limited liability entity for a reasonable time during administration of the estate.

        (i)  Attorneys who are partners, members, managers, or employees of the limited liability entity and who practice law in New Hampshire shall be duly licensed by this court to practice law.

        (j)  One or more owners of the limited liability entity shall be admitted to practice law by this court and shall be engaged in the practice of law in New Hampshire.

    (4)  Standards of Conduct.

        (a)  Nothing in this rule shall be deemed to diminish or change the obligation of each attorney who is an owner of or who is employed by the limited liability entity to conduct the practice of law in accordance with generally recognized standards of professional conduct and in accordance with the specific standards which may be promulgated by this court or the licensing authority of the jurisdiction(s) in which the attorney practices.  Any attorney who, by act or omission, causes the entity to act or fail to act in a way which violates any applicable standard of professional conduct, including any provision of this rule, shall be personally responsible for such act or omission and shall be subject to discipline therefor.

        (b)  The final responsibility for the delivery of professional services in this state shall be vested in New Hampshire licensed attorneys.

    (5)  Confidentiality.  Nothing in this rule shall be deemed to modify, abrogate or reduce the attorney-client privilege or any comparable privilege or relationship, whether statutory or derived from the common law.

    (6)  Name.  The name of the limited liability entity shall contain words or abbreviations which indicate that it is a limited liability entity.

    (7)  Identity of Non-Resident Attorneys.

        (a)  Within thirty (30) days after the organization of a limited liability entity under the laws of the State of New Hampshire or the qualification to do business in New Hampshire of a foreign limited liability entity, the limited liability entity shall file with the clerk of this court a written list of the names and addresses of the owners or managers of the limited liability entity who are not licensed to practice law in the State of New Hampshire and a notarized statement certifying that such owners or managers are in good standing before the licensing authority of the jurisdiction(s) in which they are actively engaged in the practice of law.  Within thirty (30) days after any change in the status of such owners or managers, a revised list setting forth the information required by the preceding sentence shall be filed with the clerk of this court.  There shall also be filed with the clerk of this court such other information as this court may from time to time prescribe.

        (b)  In the event that any disciplinary proceeding shall be instituted against any attorney not licensed in New Hampshire who is an owner, manager, or employee of a limited liability entity, notice of such proceeding shall be given to the clerk of this court forthwith.

        (c)  All applications, reports, and other documents required to be filed with this court by this rule shall be signed and verified by an owner of the limited liability entity who is an attorney licensed to practice law by this court.

    (8)  Trust Accounts.  Each limited liability entity which maintains an office in a state other than the State of New Hampshire shall comply with the provisions of Rules 50 and 50-A, subject, however, to any requirements which may be imposed by the comparable rules adopted by the highest court of that state with respect to trust funds being maintained in that state.  To the extent that the rule of such other state may apply to trust funds maintained in that state, the limited liability entity shall comply with such rule and shall so certify to the clerk of this court annually on or before August 1.

    (9)  Letterhead.  A limited liability entity which practices law in a jurisdiction other than New Hampshire and which lists its employees on its letterhead and in other permissible listings shall do so in a manner which makes clear the jurisdictional limitations on those employees of the limited liability entity not licensed to practice in all listed jurisdictions.

    (10)  Liability.  The liability of individuals and limited liability entities for performance of professional services in this state shall be determined under the common law and statutory law of this state.

ADVISORY RULES COMMITTEE COMMENT

                   This rule does not authorize a limited liability entity to practice law in New Hampshire if said practice is prohibited by New Hampshire statute.  It appears to be an unsettled question under New Hampshire law whether a foreign professional corporation is prohibited from practicing law in New Hampshire.  See RSA 311:11, :11-a; RSA ch. 294-A. 

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