One outstanding question is how the state will define “proceeding,” as the rule does not formally define the term. As such, the Commissioner may have some discretion in how this rule is applied. For example, the Commissioner could define “proceeding” broadly to include all actions and petitions, whether contested or uncontested; formal hearings or informal meetings with the Commissioner; or a written reply to a critical report on examination or a market conduct report that does not result in a hearing on the record. This may also include representation of a purchaser of a domestic insurer in filing a Form A Change of Control petition or appearance at an Insurance Department Form A change of control hearing, and so forth.
The Connecticut Insurance Department has confirmed that it is required to amend Section 38a-8-33 by January 1, 2017 to conform to the revision in Section 2-16. However, Burton Cohen, the Chairman of the Unauthorized Practice of Law Committee of the Connecticut Bar Association, believes that any out-of-state attorney who participates in an administrative proceeding now without first being admitted by the court could be viewed as violating Connecticut law for engaging in the unauthorized practice of law.
Mr. Cohen believes that this rule change “levels the playing field as more out of state attorneys are appearing in administrative agency proceedings without demonstrating their qualifications to practice law and without paying into the client security fund and attributing their legal fees to Connecticut for income tax purposes.” In addition, the rule change may also be intended to protect Connecticut attorneys who specialize in administrative law and are competing with attorneys from New York City and Boston.
Any lawyer seeking to represent clients in a matter before the Connecticut Insurance Department is therefore cautioned to be aware of the potential ramifications of not seeking admission pro hac vice before accepting the assignment, particularly if the matter could involve a “proceeding,” in the broadest sense of that word.