In re to Abolish Neb. Ct. R. Chapter 3, Article 8, & to Make Whatever Other Rule Changes Are Necessary to Transition From, S–36–120001.

• Citation: 286 Neb. 1018,841 N.W.2d 167
• Decision Date: 06 December 2013
• Docket Number: No. S–36–120001.,S–36–120001.
• Parties: In re Petition for a Rule Change to Create a Voluntary State Bar of Nebraska: to Abolish Neb. Ct. R. Chapter 3, Article 8, and to Make Whatever Other Rule Changes Are Necessary to Transition From a Mandatory to a Voluntary State Bar Association.
• Court: Supreme Court of Nebraska

286 Neb. 1018

841 N.W.2d 167

In re Petition for a Rule Change to Create a Voluntary State Bar of Nebraska: to Abolish Neb. Ct. R. Chapter 3, Article 8, and to Make Whatever Other Rule Changes Are Necessary to Transition From a Mandatory to a Voluntary State Bar Association.

No. S–36–120001.

Supreme Court of Nebraska.

Filed December 6, 2013.

Petition to create voluntary state bar association. Petition granted in part, and in part denied.

Heavican, C.J., Wright, Connolly, Stephan, McCormack, Miller–Lerman, and Cassel, JJ.

Syllabus by the Court

1. Constitutional Law: Attorneys at Law. A state may constitutionally require a lawyer to be a member of a mandatory or unified bar to which compulsory dues are paid.

2. Attorneys at Law. The compelled association of an integrated bar is justified by the state's interest in regulating the legal profession and improving the quality of legal services.

3. Constitutional Law: Attorneys at Law. A state may constitutionally fund germane activities out of the mandatory dues of all members.

4. Constitutional Law: Attorneys at Law. The Nebraska Constitution does not expressly vest the power to define and regulate the practice of law in any of the three branches of government.

5. Constitutional Law. In the absence of an express grant of power to any of the three branches of government, the power must be exercised by the branch to which it naturally belongs.

6. Rules of the Supreme Court: Attorneys at Law. The Nebraska Supreme Court has the inherent power to promulgate rules providing for an integrated bar.

7. Constitutional Law: Attorneys at Law. The practice of law is so intimately connected and bound up with the exercise of judicial power in the administration of justice that the right to define and regulate its practice naturally and logically belongs to the judicial department of our state government.

8. Constitutional Law. Compulsory subsidies for private speech are subject to exacting First Amendment scrutiny and cannot be sustained unless two criteria are met. First, there must be a comprehensive regulatory scheme involving a mandated association among those who are required to pay the subsidy. Second, compulsory fees can be levied only insofar as they are a necessary incident of the larger regulatory purpose which justified the required association.

Per Curiam.

INTRODUCTION

Scott Lautenbaugh, a Nebraska attorney (petitioner), filed a petition with this court, asking that we abolish, strike, or repeal chapter 3, article 8, of the Nebraska Supreme Court Rules, and make whatever other rule changes are necessary to remove any requirement that attorneys licensed in Nebraska be members of the Nebraska State Bar Association (Bar Association). We invited public comment on the petition and, on September 30, 2013, heard oral presentations on behalf of petitioner and the Bar Association.

We deny the petition to create a purely voluntary bar, but we determine that the rules creating and establishing the Bar Association should be amended in the light of developments in compelled-speech jurisprudence from the U.S. Supreme Court since integration of the Bar Association in 1937. In the sections that follow, we (1) recognize the continuing constitutional legitimacy of mandatory or unified state bar associations, (2) recall the constitutional basis for and reasons justifying integration of the bar in 1937, (3) summarize the experience in other jurisdictions, (4) examine the evolution of compelled-speech jurisprudence, and (5) focus on the relevance of “germaneness.” Finally, we adopt the administrative changes we deem necessary to serve the important purposes of an integrated bar while both (1) ensuring that the Bar Association remains clearly within the permitted scope of constitutional jurisprudence and (2) avoiding the protracted litigation experienced elsewhere.

MANDATORY STATE BAR ASSOCIATIONS

Petitioner does not challenge the constitutionality of mandatory state bar associations. Analogizing state bar associations to “union-shop” arrangements, the U.S. Supreme Court established long ago that a state may constitutionally require a lawyer to be a member of a mandatory or unified bar to which compulsory dues are paid.¹

The core of petitioner's grievance in this matter arises out of the 1990 holding of the Supreme Court in Keller v. State Bar of California,² where it took up the question of “permissible expenditures” of mandatory bar dues. Relying on Abood v. Detroit Board of Education,³ a governmental employee union case, the Court delineated the First Amendment boundaries of a bar association's expenditures of compulsory dues.

Abood held that a union could not expend a dissenting individual's dues for ideological activities not “germane” to the purpose for which compelled association was justified: collective bargaining. Here the compelled association and integrated bar are justified by the State's interest in regulating the legal profession and improving the quality of legal services. The State Bar may therefore constitutionally fund activities germane to those goals out of the mandatory dues of all members. It may not, however, in such manner fund activities of an ideological nature which fall outside of those areas of activity. The difficult question, of course, is to define the latter class of activities.⁴

Thus, the Court held, “the guiding standard must be whether the challenged expenditures are necessarily or reasonably incurred for the purpose of regulating the legal profession or ‘improving the quality of the legal service available to the people of the State.’ ” ⁵

It is that “difficult question” of the use of mandatory bar dues for “germane” versus“nongermane” activities which, as in some other states, forms the basis for the challenge to Nebraska's mandatory bar which is before us today.

INTEGRATION OF BAR ASSOCIATION

In 1937, this court granted a petition to integrate the bar of the State of Nebraska.⁶ At that time, the petitioners felt that the majority of the members of the bar favored integration by Supreme Court rule to provide better service to the public by the legal profession, to combat the unauthorized practice of law, and to improve the ethical standards of the profession. ⁷ In general, the 1937 petition sought rules of this court providing for the regulation of the bar of this state.

In that proceeding, this court for the first time pondered its power to integrate the bar by rule of the court, noting that the Nebraska Constitution did not expressly vest the power to define and regulate the practice of law in any of the three branches of government. We reasoned that in the absence of an express grant of power to any of the branches, the power must be exercised by the branch to which it naturally belonged. In concluding that this court had the inherent power to promulgate rules providing for an integrated bar, we explained that we had the exclusive power to regulate the conduct and qualifications of attorneys as officers of the court, that the proper administration of justice was the main business of a court, and that “[t]he practice of law is so intimately connected and bound up with the exercise of judicial power in the administration of justice that the right to define and regulate its practice naturally and logically belongs to the judicial department of our state government.” ⁸ Because the bench and bar were so intimately related, we concluded that the problems of one were the problems of the other.

In our 1937 opinion, this court set forth the initial rules creating, controlling, and regulating the Bar Association. We formed the Bar Association “[f]or the advancement of the administration of justice according to law, and for the advancement of the honor and dignity of the legal profession, and encouragement of cordial intercourse among the members thereof, for the improvement of the service rendered the public by the Bench and Bar....” ⁹ At that time, those persons who were residents of Nebraska licensed to practice law in the state constituted the membership of the Bar Association. All members were compelled to pay dues.

In that same opinion, we also observed that our inherent power to integrate the bar included the authority to rescind the rules providing for integration. We stated, “In the event of a failure of the plan to function as hoped, it can be corrected or abandoned by the amendment or revocation of the rule by the court in the exercise of its sound judicial discretion.” ¹⁰ This petition presents the first attempt before this court to eliminate the mandatory bar in Nebraska.

ACTIONS ELSEWHERE TO ELIMINATE MANDATORY BAR

Other jurisdictions have been confronted with actions to abolish the mandatory bar. Thirty-two states and the District of Columbia require attorneys to become members of a bar and to pay dues as a condition of practicing law in that jurisdiction.¹¹ Aside from the temporary suspension of mandatory bar membership by the Wisconsin Supreme Court from 1988 to 1992, discussed in more detail below, no state association has converted from mandatory to voluntary status.¹² We note that the mandatory status of the Puerto Rico Bar Association was eliminated in 2009 by an act of the legislature, ¹³ and the law in Puerto Rico now provides for voluntary membership.¹⁴ However, in September 2013, legislation was filed to return to mandatory bar membership.¹⁵

We briefly recount recent efforts in Wisconsin, New Mexico, and New Hampshire to eliminate the mandatory state bar.

Wisconsin Bar Association

Integration of the bar in Wisconsin has been a contentious matter from the beginning. Upon the first motion seeking integration, the Supreme Court of Wisconsin postponed the matter to a time after the lawyers in military service returned home from World War II.¹⁶ When the matter of integration next came before the Supreme Court of Wisconsin, the court concluded that a voluntary bar was preferable and that the bar should not be integrated. ¹⁷...