A lawyer or a law firm may sell or purchase a law practice or an area of practice, including good will, if the following conditions are satisfied:
N.M. R. Prof'l. Cond. 16-117
Committee commentary. -
 The practice of law is a profession, not merely a business. Clients are not commodities that can be purchased and sold at will. Pursuant to this rule, when a lawyer or an entire firm ceases to practice or ceases to practice in an area of law and other lawyers or firms take over the representation, the selling lawyer or firm may obtain compensation for the reasonable value of the practice. See Rulesand NMRA of the Rules of Professional Conduct.
Termination of Practice by the Seller
 The requirement that all of the private practice or all of an area of practice be sold is satisfied if the seller in good faith makes the entire practice or the area of practice available for sale to the purchasers. The fact that a number of the seller's clients decide not to be represented by the purchasers but take their matters elsewhere, therefore, does not result in a violation. Return to private practice as a result of a change in circumstances does not necessarily result in a violation. For example, a lawyer who has sold the practice to accept an appointment to judicial office does not violate the requirement that the sale be attendant to cessation of practice if the lawyer later resumes private practice upon being defeated in a contested or a retention election for the office or resigns from a judiciary position.
 The requirement that the seller cease to engage in the private practice of law does not prohibit employment as a lawyer on the staff of a public agency or a legal services entity that provides legal services to the poor, or as in-house counsel to a business.
 The rule permits a sale of an entire practice upon retirement from the private practice of law within the jurisdiction. Its provisions, therefore, accommodate the lawyer who sells the practice upon the occasion of moving to another state.
 This rule also permits a lawyer or law firm to sell an area of practice. If an area of practice is sold and the lawyer remains in the active practice of law, the lawyer must cease accepting any matters in the area of practice that has been sold, either as counsel or co-counsel or by assuming joint responsibility for a matter in connection with the division of a fee with another lawyer as would otherwise be permitted by Paragraph E of RuleNMRA of the Rules of Professional Conduct.
Sale of Entire Practice or Entire Area of Practice
 The rule requires that the seller's entire practice or an entire area of practice be sold. The prohibition against the sale of less than an entire practice area protects those clients whose matters are less lucrative and who might find it difficult to secure other counsel if a sale could be limited to substantial fee-generating matters. The purchasers are required to undertake all client matters in the practice or practice area subject to client consent. This requirement is satisfied, however, even if a purchaser is unable to undertake a particular client matter because of a conflict of interest.
Client Confidences, Consent and Notice
 Negotiations between seller and prospective purchaser prior to disclosure of information relating to a specific representation of an identifiable client no more violate the confidentiality provisions of RuleNMRA of the Rules of Professional Conduct than do preliminary discussions concerning the possible association of another lawyer or mergers between firms, with respect to which client consent is not required. See Rule NMRA. Providing the purchaser access to detailed information relating to the representation, such as the client's file, however, requires client consent. The rule provides that before such information can be disclosed by the seller to the purchaser the client must be given actual written notice of the contemplated sale, including the identity of the purchaser, and must be told that the decision to consent or make other arrangements must be made within sixty (60) days. If nothing is heard from the client within that time, consent to the sale is presumed. If actual written notice cannot be given, the seller may file with the court or may publish a constructive notice. If no objection is received within sixty (60) days of the final publication, consent is presumed. The court can be expected to determine whether reasonable efforts to locate the client have been exhausted and whether the absent client's legitimate interests will be served by authorizing the transfer of the file so that the purchaser may continue the representation. Preservation of client confidences requires that the petition for a court order be considered in camera.
 A lawyer or law firm ceasing to practice or ceasing to practice in an area of law cannot be required to remain in practice because some clients cannot be given actual notice of the proposed purchase. The requirement of actual notice as well as constructive notice suffices.
 All the elements of client autonomy, including the client's absolute right to discharge a lawyer and transfer the representation to another, survive the sale of the practice or area of practice.
Fee Arrangements Between Client and Purchaser
 The sale may not be financed by increases in fees charged the clients of the practice. Existing agreements between the seller and the client as to fees and the scope of the work must be honored by the purchaser.
Other Applicable Ethical Standards
 Lawyers participating in the sale of a law practice or a practice area are subject to the ethical standards applicable to involving another lawyer in the representation of a client. These include, for example, the seller's obligation to exercise competence in identifying a purchaser qualified to assume the practice and the purchaser's obligation to undertake the representation competently, see RuleNMRA of the Rules of Professional Conduct; the obligation to avoid disqualifying conflicts, and to secure the client's informed consent for those conflicts that can be agreed to, see Rule NMRA of the Rules of Professional Conduct (regarding conflicts) and Paragraph E of Terminology of the Rules of Professional Conduct (for the definition of "informed consent"); and the obligation to protect information relating to the representation, see Rule NMRA, Rule NMRA and Paragraph B of Rule NMRA of the Rules of Professional Conduct (regarding conflicts).
 If approval of the substitution of the purchasing lawyer for the selling lawyer is required by the rules of any tribunal in which a matter is pending, such approval must be obtained before the matter can be included in the sale. See RuleNMRA of the Rules of Professional Conduct.
Applicability of the Rule
 This rule applies to the sale of a law practice by representatives of a deceased, disabled or disappeared lawyer. Thus, the seller may be represented by a non-lawyer representative not subject to these rules. Since, however, no lawyer may participate in a sale of a law practice which does not conform to the requirements of this rule, the representatives of the seller as well as the purchasing lawyer can be expected to see to it that they are met.
 Admission to or retirement from a law partnership or professional association, retirement plans and similar arrangements and a sale of tangible assets of a law practice do not constitute a sale or purchase governed by this rule.
 This rule does not apply to the transfers of legal representation between lawyers when such transfers are unrelated to the sale of a practice or an area of practice.
[Adopted by Supreme Court Order No. 08-8300-029, effective November 3, 2008; as amended by Supreme Court Order No. 13-8300-038, effective December 31, 2013.].
ANNOTATIONS The 2008 amendment, approved by Supreme Court Order No. 08-8300-029, effective November 3, 2008, changed "or a portion thereof" to "or an area of practice" in the introductory sentence; deleted former Paragraph A which required 60 day notice of the sale to the seller's clients and which specified the content of the notice; deleted former Paragraph B which required the publication of a notice of the sale and specified the content of the notice; deleted former Paragraph C which provided for the fees that could be charged by the purchaser; deleted former Paragraph D which provided that the lawyers participating in the sale were subject to the Rules of Professional Conduct that apply when a lawyer terminates representation of a client or involves another lawyer in the representation; and added new Paragraphs A through E.