Are You a California Attorney-Neutral? Don’t Retire Your Law License.
California’s Second District Court of Appeals has ruled that the State Bar may preclude inactive licensees from acting as private arbitrators and mediators. Getzels v. State Bar of California, No. B338089 (Cal. App. 2nd Dist. 4th Div. June 26) (available at https://bit.ly/3ZWU285).
The decision came after the plaintiff, Morris S. Getzels, an attorney and licensee of the defendant California State Bar, appealed a dismissal judgment. Getzels challenged the constitutionality of State Bar Rule 2.30, subdivisions (B) and (C), which prohibit inactive licensees from acting as private arbitrators and mediators.
Getzels claimed that the rule violated the Equal Protection Clauses of the federal and California Constitutions by treating inactive licensees differently from everyone else “in the entire world,” according to the unanimous three-judge appellate panel opinion. He claimed that the rule’s disparate treatment of inactive licensees was subject to strict scrutiny because the rule impinged on a fundamental liberty, “freedom of contract,” and, alternatively, that there was no rational basis for the rule.
In particular, California State Bar Rule 2.30(B), in its current version, states that “[n]o licensee practicing law, or occupying a position in the employ of or rendering any legal services for an active licensee, or occupying a position wherein he or she is called upon in any capacity to give legal advice or counsel or examine the law or pass upon the legal effect of any act, document or law, shall be enrolled as an inactive licensee.”
In asserting his claim that strict scrutiny review applied to his challenge to Rule 2.30, Getzels argued that the rule impaired the “freedom of contract liberty rights of disputants and litigants to choose whomever they want to arbitrate or mediate their disputes.” He claimed that “freedom of contract liberty” is a fundamental right guaranteed under the U.S. Constitution’s Fourteenth Amendment. The court rejected this claim, finding that “the freedom of contract” is not a fundamental right based on Supreme Court precedent (namely, West Coast Hotel Co. v. Parrish, 300 U.S. 379, 392 (1937)) and that therefore rational basis review, not strict scrutiny, applied.
The court then turned to Getzels argument that Rule 2.30 did not withstand rational basis review, finding that the distinctions drawn by the rule bear some rational relationship to a conceivable legitimate state interest. The court found that California has a legitimate interest in maintaining a competent bar and assuring the professional conduct of licensees, and that Rule 2.30’s distinction between active licensees and inactive licensees bears a rational relationship to the goal of assuring licensees’ professional conduct.
The court found that the State Bar could rationally conclude that an inactive licensee occupying a position wherein he or she is called upon to give legal advice would burden its regulatory system because the State Bar could receive complaints about inactive licensees serving as arbitrators and mediators, and would have to respond to them.
Additionally, the court found that there was a rational basis for Rule 2.30’s disparate treatment of inactive licensees and non-licensees who may work as private arbitrators and mediators. The court reasoned that non-licensed arbitrators and mediators are not subject to the State Bar’s jurisdiction, and would therefore not burden the its regulatory system.
The court highlighted the potential burden that inactive licensees might place on the State Bar’s regulatory system if they were to continue practicing as private arbitrators and mediators. Given that they pay lower fees to the State Bar than active members, the court reasoned that the State Bar’s potential regulatory burden was a legitimate concern that ultimately satisfied rational basis review.
Still, the court did not address the demands of potential complaint procedures for active bar members as opposed to inactive members, and non-licensed, nonlawyer neutrals. Presumably, fees paid by each arbitrator and mediator, regardless of bar status, toward the maintenance of a regulatory system would offset the State Bar’s interest in treating inactive members differently from active members and nonmembers.
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The author, who will be a second-year student this fall at Brooklyn Law School in New York, is a 2025 CPR Institute Summer intern.
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