A Reminder for Non-Resident Attorneys Seeking to Practice in New York: Be Sure to Comply with Judiciary Law § 470!

December 28, 2017

This week, we examine the answer to a simple question: may an out-of-state lawyer serve as counsel in a New York state court proceeding absent making a motion for admission pro hac vice? To answer this slightly ambiguously worded question, we need more information.  Specifically, the answer depends on the meaning of “out-of-state” in a particular situation.  The determinative factor is not whether the attorney resides in New York, but whether she maintains a law office in the state. Under Judiciary Law § 470 — the constitutionality of which was recently upheld (see Schoenefeld v. New York, 748 F.3d 464 [2d Cir 2014] [certifying question of statute’s constitutionality to New York Court of Appeals], Schoenefeld v. State, 25 NY3d 22 [2015] [answering certified question]) — an attorney who resides “in an adjoining state” may practice in New York only if she is admitted to practice and maintains a physical law office in New York.

A recent decision from the Appellate Division, First Department makes clear that the in-state office requirement is not to be taken lightly, especially by would-be plaintiff’s counsel. In Arrowhead Capital Fin., Ltd. v. Cheyne Speciality Fin. Fund L.P., the First Department affirmed a decision of the New York County Commercial Division (Hon. Shirley Werner Kornreich, J.), dismissing the complaint solely on the basis that at the time the action was commenced, plaintiff’s counsel failed to maintain an in-state office.

Further, the First Department found that the plaintiff’s ex post facto retention of New York based co-counsel was moot, holding that the “commencement of the action in violation of Judiciary Law § 470 was a nullity.” Additionally, the First Department affirmed the Commercial Division’s decision permitting the defendants’ dispositive motion based on Judiciary Law § 470, even though it was their second such motion, because at time the defendants made their first motion, they had no reason to suspect that plaintiff’s counsel had violated the statute.

For those curious readers, the standard for what qualifies as maintaining a physical office in New York for purposes of the statute has been examined on multiple occasions. Not surprisingly, maintaining a small, barely accessible room in the basement of a restaurant/bar in New York is insufficient (see Lichtenstein v. Emerson, 251 AD2d 64 [1st Dept 1998]), while establishing proof of an “of counsel” relationship with a New York attorney who has a New York office is sufficient (see Tatko v McCarthy, 267 AD2d 583 [3d Dept 1999]).