Lawsuit Over Ban on Non-Profit Legal Organizations Assisting Non-Indigent Clients Resolved

Posted: Oct, 22, 2019

The R.I. Supreme Court has revised a court rule that favorably resolves objections that had been raised in a federal lawsuit filed last year by ACLU of Rhode Island cooperating attorneys on behalf of SouthCoast Fair Housing (SCFH), which had been prevented by the rule from providing legal help to victims of housing discrimination in RI. As a result of the revisions, SCFH will be dismissing the suit.

As the rule, known as Rule 11, had been written, non-profit organizations could not obtain a license to practice law in the state unless they served only “indigent” clients. The revised rule, entered on October 17th, eliminates that requirement.

SCFH is a non-profit organization that promotes fair housing practices and works to ensure affordable housing opportunities for all.  It has particular expertise in handling claims under the Fair Housing Act, including families who are denied housing because they have young children. Some of those complainants are not indigent, but cannot afford private counsel either or are otherwise interested in relying on the organization’s expertise for their legal matters. SCFH provides them assistance regardless of income status.

In May 2017, SCFH applied for a license to practice law in RI, but was rejected because its assistance to victims of housing discrimination in RI was not limited to those who are indigent. As a result, although the agency provided legal help to clients based in southeastern MA, SCFH was barred from assisting similarly situated individuals who lived in RI.

The lawsuit, filed by ACLU of RI volunteer attorneys Mark W. Freel and Jeffrey Ankrom of Locke Lord, argued that “the requirement in Rule 11 that nonprofits restrict their client base to ‘indigent’ clients is unreasonable, arbitrary and not narrowly tailored to serve a compelling state interest.” The suit claimed that the Rule violated the rights of SCFH and its potential clients under the First Amendment to freely associate and to seek redress of grievances.  The suit noted that other rules of the Court recognized that it is not just the poor, but “sometimes persons who are not poor” who are unable to afford adequate legal assistance. The revised rule also eliminates a second challenged provision that required the non-profits, unlike other legal entities, to be incorporated in Rhode Island.

Kristina da Fonseca, executive director of SCFH, said today: “We are pleased that the Court has modified this Rule. We expect this change will lead to increased access to legal services, both for those who are low-income and for those who are not. SCFH looks forward to applying for a license under this modified Rule, and hopes to soon offer legal services in Rhode Island to individuals who have experienced housing discrimination.”

ACLU of RI volunteer attorney Mark Freel added: “It is gratifying that the Supreme Court has recognized that non-profit legal service entities like SouthCoast provide a valuable and necessary service to clients at all income levels, and that those entities should enjoy the same rights as any other legal service, irrespective of the specific economic status of their client base.”

More information about the lawsuit, and a copy of the court’s order revising the rule, can be found here.