As used in these regulations, Chapter XVI, unless otherwise indicated, the term

"Act" means the Legal Services Corporation Act of 1974, Pub. L. 93-355, 88 Stat. 378, 42 U.S.C. 2996-29961.

"Appeal" means any appellate proceeding in a civil action as defined by law or usage in the jurisdiction in which the action is filed.

"Attorney" means a person who provides legal assistance to eligible clients and who is authorized to practice law in the jurisdiction where assistance is rendered.

"Eligible Client" means a person or group determined to be eligible for legal assistance under the Act.

"Employee" means a person employed by the Corporation or by a recipient.

"Fee Generating Case" means any case or matter which, if undertaken on behalf of an eligible client by an attorney in private practice, reasonably may be expected to result in a fee for legal services from an award to a client, from public funds, or from the opposing party.

"Legal Assistance" means the provision of any legal services consistent with the purposes and provisions of the Act.

"Outside Practice of Law" means the provision of legal assistance to a client who is not entitled to receive legal assistance from the employer of the attorney rendering assistance, but does not include, among other activities, teaching, consulting, or performing evaluations.

"President" means the President of the Corporation or the President's designee.

"Public Funds" means funds received from a Federal, State, or local government, or any instrumentality of

a government, or from an independent organization that expends funds received from a government.

"Recipient" means any grantee or contractor receiving financial assistance from the Corporation under Section 1006(a)(1)(A) of the Act.

"Staff Attorney" means an attorney more than one half of whose annual professional income is received from a recipient that limits its activities to providing legal assistance to clients eligible for assistance under the Act.

"Tribal Funds" means funds received from an Indian tribe, or from a private foundation, for the benefit of an Indian tribe.

(Pub. L. 93-355, 88 Stat. 378, 42 U.S.C. 299629961)

[41 FR 18511, May 5, 1976]

for legal assistance in noncriminal proceedings or matters to persons financially unable to afford legal assistance. Except as otherwise specifically provided in the Act, the Corporation is not considered a department, agency, or instrumentality of the United States Government.

§ 1601.2 Powers and duties.

The powers and duties of the Corporation are as set forth in the Act. The powers of the Corporation include, to the extent consistent with the Act, the powers conferred upon a nonprofit corporation by the District of Columbia Nonprofit Corporation Act, D.C. Code Title 29, Chapter 10, other than the power to cease corporate activities. § 1601.3 Definitions.

As used in these By-laws, except where the context otherwise requires

(a) "Act" means the Legal Services Corporation Act, 42 U.S.C. § 299629961, which was added to the Economic Opportunity Act of 1964 as Title X thereof by an Act of Congress cited as the Legal Services Corporation Act of 1974, Pub. L. 93-355, approved July 25, 1974, 88 Stat. 378, as amended.

(b) "Board" means the Board of Directors of the Corporation.

(c) "Corporation" means the Legal Services Corporation established by section 1003 of the Act, 42 U.S.C. 2996b;

(d) "Director" or "member of the Board" means a voting member of the Board of Directors appointed by the President of the United States;

(e) The pronouns "he," "him," and "his" mean, respectively, "he or she," "him or her," and "his or her";

(f) "Member of the immediate family" means, with respect to any individual, a spouse, child, parent, brother, or sister of such person, or a spouse or relative of any of the foregoing who has the same home as such person;

(g) "Person" means an individual, corporation, association, partnership, trust, or other entity;

(h) "Recipient" means a grantee, contractee, or recipient of financial as

sistance described in clause A of section 1006(a)(1) of the Act;

(i) "Telegraph" includes any means of record communication.

[40 FR 52022, Nov. 7, 1975, as amended at 45 FR 58363, Sept. 3, 1980]

Subpart B-Offices and Agents

§ 1601.4 Principal office.

The Corporation shall maintain its principal office in the District of Columbia.

§ 1601.5 Agent.

The Corporation shall maintain in the District of Columbia designated agent to accept service of process for the Corporation.

§ 1601.6 Other offices and agents.

The Corporation may also have offices and agents at such other places, either within or without the District of Columbia, as the business of the Corporation may require.

Subpart C-Board of Directors

§ 1601.7 General powers.

The property, affairs, and business of the Corporation shall be under the direction of the Board, subject to the provisions of the Act.

§ 1601.8 Number, terms of office, and qualifications.

(a) The Board shall consist of eleven voting members and the President of the Corporation ex officio. The voting members shall be appointed by the President of the United States by and with the advice and consent of the Senate. No more than six of the voting members shall be of the same political party. A majority of the voting members shall be members of the bar of the highest court of a state. None of the voting members shall be a fulltime employee of the United States.

(b) The term of office of each voting member of the Board shall be three years, except that five of the members first appointed have been designated by the President of the United States to serve for a term of two years. Each member of the Board shall continue to

serve until his successor is appointed and qualified. The term of the initial members of the Board shall be computed from July 14, 1975, the date of the first meeting of the Board. The term of each member of the Board other than the initial members shall be computed from the date of termination of the preceding term. Any member of the Board appointed to fill a vacancy occurring prior to the expiration of the term for which such member's predecessor was appointed shall be appointed for the remainder of such term. No member of the Board shall be reappointed to more than two consecutive terms immediately following such member's initial term.

§ 1601.9 The Chairman of the Board.

The initial Chairman of the Board, during the period July 14, 1975 to July 13, 1978, shall be a member of the Board initially designated as Chairman by the President of the United States or, if he should resign or otherwise vacate his office or his Board membership, the member subsequently so designated by the President of the United States. Thereafter, annually or at such other time as there may be a vacancy in this office, the Board shall elect a Chairman of the Board from among its voting members who shall serve in such capacity until his successor has been duly elected and qualified, or until he shall resign or otherwise vacate his office or his Board membership. The Chairman of the Board shall, if present, preside at all meetings of the Board, shall carry out all other functions required of him by the Act and these By-laws, and shall perform such other duties as from time to time may be assigned to him by the Board.

§ 1601.10 Qualification.

A person shall be deemed to have qualified as a Director, or as the Chairman of the Board, when upon his appointment or selection, as the case may be, he has affirmed or executed a statement, in a form provided by the Board, to discharge his duties faithfully.

§1601.11 Outside interests of directors.

(a) No member of the Board may participate in any decision, action, or recommendation with respect to any matter which directly benefits such member or pertains specifically to any firm or organization with which such member is then associated or has been associated within a period of two years. For the purposes of this paragraph (1) a member of the Board shall be deemed "associated" with a firm or organization if he, (i) is serving or has served within the past two years as a director, officer, trustee, employee, consultant, attorney, agent, or partner thereof, or in any of such other capacities as the Board may from time to time determine, (ii) is negotiating or has any arrangement concerning prospective employment therewith, or, (iii) has or has had within the past two years any direct or indirect financial or ownership interest therein; and (2) the term "member of the Board" includes a member of the immediate family of a member of the Board. If a Director violates this paragraph in connection with any transaction, the validity of the transaction, unless void by law or voidable by the Corporation, shall not be affected by the violation, but the Director by law may be liable to the Corporation for damages.

(b) Pursuant to procedures to be established by the Board from time to time, each member of the Board, upon assuming office and at least annually thereafter, shall file with the Secretary a statement identifying any firm or organization with which he is then or has been within the past two years associated (as defined in paragraph (a) of this section) and the nature of the association. In the event the association is a result of a financial or ownership interest, that fact shall be reflected in the statement, but the member need not reveal the degree of financial interest. Such statements shall be available for public inspection.

81601.12 Removal.

(a) A Director may be removed, by a vote of seven members at a meeting of the Board, for persistent neglect of or inability to discharge duties, for malfeasance in office, or for offenses in

volving moral turpitude, and for no other cause.

(b) When a Director shall fail to appear at three consecutive meetings of the Board or at one-half of the meetings held during a two-year period, the Secretary shall notify him in writing that the agenda for the next meeting of the Board will include the question whether he should be removed for persistent neglect of or inability to discharge duties.

(c) Except as provided in paragraph (b) of this section, the Board shall consider whether a Director shall be removed only when five or more Directors have stated in writing that they believe there is reasonable cause for such action, giving specific allegations in support of such belief.

(d) A Director may not be removed unless (1) notice of the basis of removal has been given to such Director at least thirty days before a vote is taken concerning his removal and (2) the Director has been afforded the opportunity to contest his removal by making written submissions to the other members of the Board and by appearing in person, with or without counsel present, at the meeting at which the vote concerning removal is taken.

§ 1601.13 Resignation.

A Director may resign at any time by giving written notice of his resignation to the President of the United States and to the President of the Corporation. Notice of a resignation shall be posted at the offices of the Corporation in an area to which the public has access. A resignation shall take effect at the time received by the President of the United States unless another time is specified therein. The acceptance of a resignation shall not be necessary to make it effective.

§ 1601.14 Compensation.

Directors shall be entitled to received compensation at appropriate rates prescribed by the Board, not in excess of the per diem equivalent of the rate of level V of the Executive Schedule specified from time to time in Section 5316 of Title 5, United States Code, for their services as members of the Board or of any Committee