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HomeBusiness and Professions CodeDiv. 3Ch. 4Art. 10§ 6171 Law Corporation Ownership Rules

§ 6171 Law Corporation Ownership Rules

Business and Professions Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 6171 Law Corporation Ownership Rules

Key Takeaways

  • •Law firms must have rules for buying back stock from disqualified or deceased owners.
  • •Law firms must have insurance to cover mistakes they make while helping clients.
  • •Law firms must follow naming rules set by the State Bar.
  • •Law firms must get and keep a permit if they use a fake name, and pay fees for it.

Example

A law firm uses a name like 'Smith & Associates' instead of the owners' real names.

The firm must get a permit for this fake name from the State Bar and pay a fee. If they don’t, they could get in trouble.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 6171 Law Corporation Ownership Rules

With the approval of the Supreme Court, the State Bar may formulate and enforce rules and regulations to carry out the purposes and objectives of this article, including rules and regulations requiring all of the following: (a) That the articles of incorporation or bylaws of a law corporation shall include a provision whereby the capital stock of the corporation owned by a disqualified person (as defined in the Professional Corporation Act) or a deceased person shall be sold to the corporation or to the remaining shareholders of the corporation within such time as the rules and regulations may provide. (b) That a law corporation, as a condition of obtaining a certificate pursuant to the Professional Corporation Act and this article, shall provide and maintain security by insurance or otherwise for claims against it by its clients for errors and omissions arising out of the rendering of professional services. (c) That the name of the law corporation and any name or names under which it renders legal services shall be in compliance with the rules and regulations. (d) That the law corporation shall obtain from the State Bar, and maintain current, a fictitious name permit when required by the rules and regulations; that the permit may be obtained, maintained, suspended, and revoked pursuant to procedures set forth in the rules and regulations; and that the law corporation shall pay an application and renewal fee for the permit in such amounts as may be determined by the State Bar. (e) This section shall become operative January 1, 1996. (Repealed (in Sec. 3) and added by Stats. 1993, Ch. 955, Sec. 3.5. Effective January 1, 1994. Section operative January 1, 1996, by its own provisions.)

Last verified: January 23, 2026

Key Terms

corporationinsurancecomplianceshareholderlienclaimregulationstock

Related Statutes

  • § 4154 Pharmacy Corporation Ownership Rules
  • § 5157 Accountancy Corporation Ownership Rules
  • § 2781 Nursing Corporation Stock Regulations
  • § 2999 Psychological Corporation Regulations
  • § 3167 Optometric Corporation Ownership Rules

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Business and Professions Code. Section 6171.
View Official Source