SUBJECT

Proposed Law Corporations Rules

BACKGROUND

State Bar rules for registration of law corporations are being revised as part of the State Bar’s ongoing rule revision project.  In March 2010, revised law corporations rules 3.150 - 3.161 were adopted by the Board of Governors, subject to approval by the Supreme Court, without inclusion of provisions for nonprofit public benefit law corporations. At the time, it was not known whether the Supreme Court would act on recommendations made in a report submitted by the State Bar pursuant to instructions stated in Frye v. Tenderloin Housing, Inc.,(2006) 38 Cal.4th 23, at p. 50. It is now known that the Court does not intend to take action on the recommendations.

The current Law Corporation Rules of The State Bar of California include provisions for registration of nonprofit public benefit law corporations. It would be appropriate to add provisions for such corporations in the rules adopted by the Board in March 2010.

PROPOSAL

This proposal would amend revised law corporations rules adopted by the Board in March 2010, subject to Supreme Court approval, to allow nonprofit public benefit corporations that meet statutory requirements to register with the State Bar as a law corporation. The proposal would make other non-substantive modifications consistent with the amendments.

The agenda item (Attachment 1) explains how the proposed amendments apply to nonprofit public benefit law corporations that fall within the “safe harbors” articulated in the Frye case. To be eligible for registration, a nonprofit public benefit corporation would have to meet the statutory requirements of Business and Professions Code section 6161 and Corporations Code section 13406 (see proposed rule 3.151).

Any Known Fiscal/Personnel Impact: None known. 

ATTACHMENTS
  • Attachment 1 - Agenda item dated July 1, 2010 proposing amendments to the law corporations rules adopted in March 2010
  • Attachment 2 - Proposed amended Law Corporations Rules 3.150 - 3.161
  • Attachment 3 - The current Law Corporation Rules of The State Bar of California
SOURCE

Board Committee on Member Involvement, Relations and Services
July 22, 2010

COMMENT DEADLINE

Aug. 25, 2010

DIRECT COMMENTS To:

Debbie Yee
Office of Member Services
The State Bar of California
180 Howard Street
San Francisco, CA 94105
(415) 538-2273
(415) 538-2305 Fax

Email: debbie.yee@calbar.ca.gov