Ethics Opinion Articles - NC State Bar Journal

Parting Company with the State Bar...or, You Can Run but You Can't Resign

By Alice Neece Moseley

Every year, over 100 lawyers seek to "retire" from the North Carolina State Bar. The reasons for “retirement” generally fall into one of the following categories: (1) the lawyer cannot, or no longer wants to, practice law because of health or age; (2) the lawyer wants to pursue another occupation such as motherhood; or (3) the lawyer intends to practice law in another state under the license of that jurisdiction. At some point, most of us will also want to “retire” from the Bar to pursue other challenges in life. Unfortunately, the only way to get shed of your law license and your relationship with the State Bar forever is, well, to get disbarred. This article does NOT, however, recommend a little strategic trust account embezzlement around the time that you turn 65. Fortunately, if you follow a relatively simple procedure, you can place your law license in an “inactive” status until such time as you want to come out of hibernation and return to the practice of law. Transferring to inactive status has several attractive features. While you are an inactive member of the Bar, you do not have to pay annual dues or the Client Security Fund assessment nor do you have to accumulate CLE credit hours. But here is the really good news: if you follow the correct procedure (as opposed to getting disbarred), you can re-activate your law license simply by filing a petition for reinstatement before a quarterly meeting of the State Bar Council. . . AND you do not have to take the bar examination again.

Active and Inactive Members

The General Assembly eliminated the possibility of permanent resignation from the Bar by creating only two classes of membership: active and inactive. See G.S. 84-16. An active member has a license to practice law in North Carolina and has paid the annual dues of the State Bar. In addition to paying dues, an active member must pay any current Client Security Fund assessment, comply with the annual continuing legal education requirements, and maintain membership with the district bar in the judicial district in which he or she lives or works. Inactive members are “all persons found by the council to be not engaged in the practice law and not holding themselves out as practicing attorneys….” Id. If you are classified inactive, you may not represent clients, give legal advice, or otherwise practice law in North Carolina including pro bono representation and acting in an “of counsel” capacity to a law firm.

Petitioning for Inactive Status

To become an inactive member of the State Bar, a lawyer must petition the council for a change in status. The petition form is short and only requests the most basic information about why the lawyer desires to become inactive. (The personal favorite of the membership department is the petition of the nascent wine merchant who wrote that he wished to become inactive because, “I can best serve the legal community by serving good cheap wine.”) A copy of the petition may be obtained from the membership department of the Bar or from the “Forms” section of the pull-down menus of the 1999 Handbook on CD-ROM or the State Bar website, www.ncbar.com.

A Petition in Time…

Petitions for inactive status are considered at the quarterly meetings of the State Bar Council held in January, April, July, and October. The council will approve your petition only if you have your ducks in a row. If you have a CLE credit hour deficit, you are NOT required to take CLE courses before petitioning for inactive status (the CLE deficit will come back to haunt you when you seek reinstatement). Before the petition will be allowed, however, annual dues and all other fees and penalties owed to the Bar (CLE fees are the most common) must be paid and all pending grievances must be resolved.

The requirement of financial good standing with the Bar as a condition of inactive status frequently vexes lawyers who intend to become inactive at the beginning of a new calendar year but fail to send in the petition before the end of the preceding calendar year. Members who file petitions to transfer to inactive status at any time on or after January 1 are obliged to pay the annual membership fee and Client Security Fund assessment for the year in which the petition is filed. The membership fee and Client Security Fund assessment cannot be waived, rebated, prorated, or apportioned (See G.S. 84-34). This means a petition received after January 1 must be accompanied by a check for the full amount of the current year's dues plus any Client Security Fund Assessment for the current year. Although the Administrative Committee of the State Bar recently decided to treat petitions received before the meeting of the committee in January as received on December 31 of the preceding year, it is better to be safe and mail the petition to the membership department prior to the end of the year.

A word to the wise: when you petition for reinstatement, you must pay a $125 fee plus the dues and Client Security Fund assessment for the current year. This means that it really doesn’t pay to go inactive unless you plan to be out of the practice for more that one year.

For More Scintillating Information about Membership

Granted, this is pretty dull stuff but important to know if you are considering retirement, a change of careers, or a sabbatical from the practice. If you have specific questions regarding your membership status you may contact Anne Parkin, Membership Coordinator, at (919) 828-4620, for assistance. I also encourage you to read the 1999 State Bar Handbook, 27 N.C.A.C. Chapter 1A, Sections .0200 and .0900, for detailed information regarding membership with the State Bar.