The legal profession occupies a unique and essential role in our society. Lawyers are entrusted with protecting individual rights, advancing justice, and upholding the rule of law. Given these weighty responsibilities, it is not surprising that the regulation of the practice of law has been subject to careful, and sometimes contested, oversight. This article discusses the authority to regulate lawyers through an examination of constitutional principles, including the separation of powers, and a look at recent developments in case law.
Judicial Primacy in Regulating Lawyers
The regulation of the practice of law is predominantly in the province of the judiciary. Each state’s highest court holds inherent and exclusive authority to oversee the admission, discipline, and ethical obligations of lawyers practicing within its jurisdiction. Since the ratification of the United States Constitution and each state’s own constitution, the separation of powers and independence of the judiciary have been pillars of the republican form of government. Consistent with that concept, the state constitutions give their respective judicial bodies exclusive jurisdiction over the practice of law.
Courts have long maintained that because lawyers are essential to the administration of justice, their regulation falls naturally within judicial control. In practice, this judicial oversight takes shape through court rules, rules of professional conduct, and disciplinary bodies operating under the auspices of state supreme courts. Every aspect of a lawyer’s practice is encompassed by these rules. Everything from the process by which attorneys are admitted to practice, to the manner in which an attorney may leave the practice of law, are regulated. Advertising, accounting of client funds, communication with clients, dealings with third parties, competence of the attorney, conflicts of interest, and the unauthorized practice of law are among the myriad subjects that these comprehensive rules contemplate.
Clearly, each state’s judiciary has a long-standing tradition of upholding its obligation to regulate the practice of law. As evidenced by the promulgation of far-reaching and thorough rules and the efficient enforcement of them, the judiciary has guarded the public trust inherently implicated by the attorney-client relationship.
Legislative Involvement in Regulating the Practice of Law
While the judiciary retains ultimate authority, legislatures also play an important, albeit limited, role in regulating lawyers. State legislatures possess the general police power to enact statutes promoting public welfare, which can intersect with the legal profession in various ways. However, when legislative enactments purport to regulate core aspects of law practice, they must do so in a manner consistent with constitutional limits and the judiciary’s inherent authority.
For example, legislatures may enact laws addressing issues that affect the practice of law indirectly, such as statutes governing business organization forms for law firms and consumer protection laws. These legislative measures are generally valid as long as they do not interfere with the judiciary’s exclusive control over admissions, ethics, or disciplinary processes. The RPCs specifically note that any dual regulation of attorneys should be avoided. See ABA Model R. Prof’l Conduct 8.5 Cmt. [3]. In an effort to avoid multiple sets of potentially conflicting regulations, attorneys are often exempted from the coverage of statutory schemes. In some instances, this is done expressly by the legislature. In other instances, the judicial branch has exempted attorneys from statutes. See, e.g., Vort v. Hollander, 257 N.J. Super. 56 (App. Div. 1992), certif. den. 130 N.J. 599 (1992).
In Vort v. Hollander, the New Jersey Appellate Division affirmed dismissal of a consumer fraud claim brought against an attorney on the basis that “attorney’s services do not fall within the intendment of the Consumer Fraud Act.” 257 N.J. Super. 56, 62 (App. Div. 1992), certif. den. 130 N.J. 599 (1992). The Court further observed that “the practice of law in the State of New Jersey is in the first instance, if not exclusively, regulated by the New Jersey Supreme Court.” (citing N.J. Const. art. VI, § 2, ¶ 3). This is not a minority view. A majority of states agree with New Jersey’s approach and have judicially excluded attorneys from consumer protection statutes for the same reasons as New Jersey. See, e.g., Preston v. Stoops, 285 S.W.3d 606, 609 (Ark. 2008) (The Arkansas Deceptive Trade Practices Act does not apply to the practice of law because “[o]versight and control of the practice of law is under the exclusive authority of the judiciary.”); Beyers v. Richmond, 937 A.2d 1082, 1092 (Pa. 2007)(“The General Assembly has no authority under the Pennsylvania Constitution to regulate the conduct of lawyers and the practice of law.”); Rousseau v. Eschleman, 519 A.2d 243 (N.H. 1986)(attorneys are exempted from the provisions of New Hampshire’s Consumer Protection Act because the Supreme Court established a professional conduct committee which has responsibility for regulating attorney conduct).
The Limits of Legislative Authority
Tension arises when legislative measures encroach upon the judiciary’s exclusive domain over regulating the practice of law. Courts have repeatedly invalidated statutes that attempt to dictate who may be admitted to the bar or to limit an attorney’s right to practice law. Such legislative actions are typically struck down as violations of the separation of powers doctrine.
A leading example is found in cases where legislatures have enacted statutes regulating persons engaged in providing “debt negotiation” and “debt adjustment” services. Attorneys routinely provide debt negotiation and adjustment services to clients in connection with a representation. See generally, Ferguson v. Skrupa, 372 U.S. 726, 732 (1963) (a “debt adjuster’s client may need advice as to the legality of the various claims against him, remedies existing under state laws governing debtor-creditor relationships, or provisions of the Bankruptcy Act – advice which a nonlawyer cannot lawfully give him[.]”). Courts have ruled that such attempts encroach on the judiciary’s exclusive authority over the practice of law.
In Persels & Assocs., LLC v. Banking Comm’r, 122 A.3d 592 (Conn. 2015), the Supreme Court of Connecticut held that a limited attorney exemption in a debt negotiation statute was unconstitutional because it usurped the judiciary’s exclusive authority to regulate attorney conduct and licensure. The debt negotiation statute authorized the Banking Commissioner to license and regulate persons engaged in the debt negotiation business, and provided a limited attorney exemption for attorneys who engage or offer to engage in debt negotiation as an “ancillary matter” to such attorneys’ representation of a client. Persels, 122 A.3d at 654 (quoting CT Gen. Stat. § 36a-671c(1)). The Court in Persels held that debt negotiation services provided by a national law firm were inextricably bound with the practice of law by licensed Connecticut attorneys who were regulated exclusively by the judicial branch. Id. at 676. Therefore, the limited attorney exemption violated the separation of powers provision of the Connecticut Constitution such that it was unenforceable as to Connecticut attorneys engaged in the bona fide practice of law. Id.
Earlier this year, the New Jersey Appellate Division found unconstitutional a limited attorney exemption in a debt adjustment statute that broadly defined “debt adjuster” such that “a particular task [could] amount to both the practice of law and a debt adjustment activity at the same time.” See Anchor L. Firm, PLLC v. State of New Jersey, et al., No. A-0052-23, 2025 N.J. Super. LEXIS 37, at *30 (N.J. App. Div. May 9, 2025). In Anchor, the authors of this article appeared on behalf of amicus curiae New Jersey State Bar Association, briefed, and argued that the limited attorney exemption impermissibly infringed on the state Supreme Court’s exclusive authority to regulate the practice of law.
The statutory exemption in question was confined to those attorneys who were “not principally engaged as [] debt adjuster[s].” N.J.S.A. 17:16G-1(c). However, the term “principally engaged” was not defined in the statute. The failure to procure a license and comply with other regulatory requirements exposed attorneys to civil and even criminal penalties. In Anchor, the Appellate Division declared the limited attorney exemption as violative of the judiciary’s authority over the practice of law and as void for vagueness, holding that the exemption must be construed “as a total exemption of all attorneys when they are lawfully practicing in [New Jersey].” 2025 N.J. Super. LEXIS at *42.
That said, courts do not view all legislative regulation with suspicion. The key distinction lies in whether the legislative measure substantively interferes with judicial administration of justice and practice of law, or simply supports broader public policy goals in a way that does not compromise judicial authority.
The Bottom Line
The regulation of the practice of law reflects a balance between the judiciary’s inherent authority and the legislature’s general power to promote public welfare. In general, the state judiciary retains primary and exclusive control over admissions, ethical standards, and disciplinary matters — essential functions necessary to preserve the integrity and independence of the legal profession. While state legislatures may enact statutes impacting lawyers and legal services, such statutes must respect constitutional limitations and avoid intruding upon the judiciary’s core functions.
Reprinted with permission from the July 17, 2025 edition of The Legal Intelligencer © 2025 ALM Global Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or reprints@alm.com.