CONFLICTS OF INTEREST Flashcards
CONFLICTS OF INTEREST // Rules
o R.1.7 CONFLICT OF INTEREST: CURRENT CLIENTS
o R.1.13 ORGANIZATION AS CLIENT
o R.1.18 DUTIES TO PROSPECTIVE CLIENT
o R.1.8(f) & (g) CONFLICT OF INTEREST: CURRENT CLIENTS: SPECIFIC RULES
o R.1.9 DUTIES TO FORMER CLIENTS
o R.1.10 IMPUTATION OF CONFLICTS OF INTEREST: GENERAL RULE
GENERAL PRINCIPLES // policies/duties behind conflicts of interest
- Duty to exercise independent judgment
- Duty to be loyal and diligently represent clients
- Duty to preserve client confidences
GENERAL PRINCIPLES // 3 levels of seriousness for conflicts
- Most serious = so serious that even consent would not solve the problem, should decline/withdraw
- Middle level = may be adequately addressed if affected clients are willing to provide informed consent
- Lowest level = may proceed without advising client or asking for consent
KEY TERMS // concurrent conflicts
= 2 current (or 1 prospective) clients
KEY TERMS // successive conflicts
= 1 current client and 1 former client
KEY TERMS // imputed conflicts
= if 1 lawyer has conflicts, infect the other lawyers in the firm as to this client
KEY TERMS // one-lawyer conflict
- Conflict between 2 clients of 1 lawyer (contrasted to imputed conflicts)
R.1.7 CURRENT CLIENT CONFLICTS // breakdown/outline of R.1.7
- R.1.7(a) determines when you have conflict
- R.1.7(b) helps to resolve conflicts
R.1.7 CURRENT CLIENT CONFLICTS // direct adversity under R.1.7(a)(1)
= if lawyer’s conduct on behalf of 1 client requires the lawyer to act against the interest of another current client
NOTE: direct adversity is more serious subset of material limitation (AKA if directly adverse, then necessarily material limitation)
R.1.7 CURRENT CLIENT CONFLICTS // 3 key examples of direct adversity
- lawyer who represents client A in one matter sues client A in second matter on behalf of client B (even if client A is represented by someone else)
- lawyer acts adversely to client in litigation (EXAMPLE = cross-examining)
- outside of litigation, lawyer undertakes adversarial negotiation against another client (BUT if negotiation is oriented more toward conciliation/cooperation, less likely to be found to involve direct adversity)
R.1.7 CURRENT CLIENT CONFLICTS // material limitation under R.1.7(a)(2)
= representation of 1 client is materially limited by 1 of the other responsibilities of the lawyer
KEY EXAMPLE = co-D’s/P’s
R.1.7 CURRENT CLIENT CONFLICTS // 5 common examples of material limitation
“other responsibilities” that might materially limit a lawyer’s representation of a client include obligations to
- another present client
- a former client
- someone else to whom a lawyer owes a duty
- someone other than the client who is paying the lawyer’s fee
- lawyer’s own financial, employment, personal, or other interests
R.1.7 CURRENT CLIENT CONFLICTS // analysis of conflict of interest problems
resolution of conflict of interest problem requires lawyers to
- clearly identify the client or clients
- determine whether a conflict of interest exists
- decide whether the representation may be undertaken despite the existence of conflict (whether consentable)
- if so, consult with clients affected and obtain informed consent confirmed in writing
CMT 2, R.1.7
R.1.7 CURRENT CLIENT CONFLICTS // resolving current client conflicts under R.1.7(b)
- Must satisfy all conditions of (b) to resolve conflict by informed consent (= consentable)
- If cannot satisfy all conditions = nonconsentable
R.1.7 CURRENT CLIENT CONFLICTS // 4 R.1.7(b) conditions
- Lawyer reasonably believes she will be able to competently and diligent represent client
- Representation not prohibited by law (EXAMPLE = in some states, cannot represent co-Ds in capital cases)
- Representation doesn’t involve assertion of claim by client against other in same proceeding before tribunal
- Each affected client gives informed consent confirmed in writing
R.1.7 CURRENT CLIENT CONFLICTS // confirmed in writing
confirmed in writing = denotes informed consent that is given in writing by the person or a writing that lawyer prompt transmit to the person confirming an oral informed consent
- if not feasible to obtain/transmit writing at time of giving informed consent, lawyer must obtain/transmit within reasonable time thereafter
R.1.7 CURRENT CLIENT CONFLICTS // consent – advance waivers
= client consents early in litigation to possible conflicts in future
VALIDITY of advance waiver = depends on factors in SEE CMT 22, PG. 348
R.1.7 CURRENT CLIENT CONFLICTS // nonconsentable under R.1.7(b)
3 times when conflict is nonconsentable (reciprocal to R.1.7(b) conditions)
- Lawyer has unreasonable belief in ability to diligently and competently represent client (SEE PG. 342)
- Representation prohibited by law
- Representation involves litigation in which lawyer is representing one client against another client whom lawyer is representing in that matter
R.1.7 CURRENT CLIENT CONFLICTS // imputation of concurrent conflicts
R.1.10(a) = firm prohibited from representing conflicting client unless 1 lawyer could’ve under R.1.7 and R.1.9
AKA if 1 lawyer has conflict with 1 other lawyer in firm = ALL lawyers in firm have conflict
(general prohibition with 2 exceptions)
R.1.18 PROSPECTIVE CLIENT CONFLICTS // duties to prospective clients
- Lawyers owe duties to prospective client under R.1.18
- Much more narrow than R.1.7
R.1.18 PROSPECTIVE CLIENT CONFLICTS // prospective client
- Definition of prospective client = R.1.18(a)
- Whether communication constitutes consultation depends on circumstances (CMT 2)
- SEE CMT 2
- SEE PG. 371-72 for all notes/key takeaways
R.1.18 PROSPECTIVE CLIENT CONFLICTS // analysis
- R.1.18(c) = Shall not represent client
- with interests materially adverse to those of a prospective client
- in the same or substantially related matter
- IF lawyer received info from prospective client
- that could be significantly harmful to that person in the matter
R.1.18(d) = EXCEPT IF
a. Both affected and prospective clients
- give informed consent
- confirmed in writing OR
b. Lawyer
- takes reasonable measures to avoid exposure to more disqualifying information than necessary to determine whether to represent prospective client
- AND timely screen
- AND written notice promptly given to prospective client
R.1.18 PROSPECTIVE CLIENT CONFLICTS // screened
R.1.0(k) defines “screened” = SEE PG. 373, FN 87
R.1.7 REPRESENTING BOTH PARTIES TO A TRANSACTION // general principles
- SEE CMT 7 = direct adversity in transaction matters
- SEE CMT 28 = whether consentable depends on circumstances
- Is it antagonistic?
- Cannot avoid potential conflict by acting like “mere scrivener”
R.1.13 REPRESENTING ORGANIZATIONS // general principles
- Client = organization itself under R.1.13(a)
- Doesn’t include officers, directors, employees, shareholders, and other constituents (CMT 1, 2)
- Possible to represent both organization and its employees/affiliates (CMT 12, R.1.13(g)) UNLESS interests of organization and employee conflict
- Need to assess if consent necessary or nonconsentable
- Can’t keep disclosure by employees confidential from organization, make sure employees know that (CMT 10)
R.1.13 REPRESENTING ORGANIZATIONS // illegal act/harm to org
If officer/employee threatens to do something that’s illegal or that would harm the organization
= Shall report up under R.1.13(b)
- Mandatory
- Must do this first
If highest authority refuses to act properly, may report out under R.1.13(c)
R.1.13 REPRESENTING ORGANIZATIONS // 4 requirements to trigger duty to report up under R.1.13(b)
- Lawyer for organization knows
- That officer/employee/etc is engaged in action or intend to act or refuses to act in matter related to representation
- Violation of legal obligation to organization or violation of law reasonably likely to be imputed to organization
- That’s likely to result in substantial injury to organization
= Then proceed as reasonably necessary in best interest of organization
R.1.13 REPRESENTING ORGANIZATIONS // considerations in reporting up more under R.1.13(b)
- If reasonably believes necessary, shall refer to higher authority
- Considerations in deciding to report up SEE CMT 4
R.1.13 REPRESENTING ORGANIZATIONS // 2 requirements to trigger duty to report out under R.1.13(c)
- Despite best efforts to report up, the highest authority that can act on behalf of the organization insists upon or fails to address in a timely and appropriate manner
- Lawyer reasonably believes violation reasonably certain to result in substantial injury to organization
= then may reveal info but only if and to the extent lawyer reasonably believes necessary to prevent substantial injury whether or not R.1.6 confidentiality permits UNLESS hired to investigate/represent org in that particular fraud/crime
REPRESENTING CRIMINAL CO-DEFENDANTS // rule
- If potential for conflict is so great, lawyer should decline to represent co-defendants in criminal cases (CMT 23 of R.1.7)
- No full-out prohibition, but ABA strongly disfavors and argues against/discourages
REPRESENTING CRIMINAL CO-DEFENDANTS // 2-part test
- 2-part test for if joint representation of co-defendants violates 6th amendment
- SEE PG. 339-400
- Compare to rule when lawyer objects to representation because of conflict and judge overrules and requires lawyer’s representation = reversal is automatic, no showing of prejudice is requires
REPRESENTING FAMILY MEMBERS // divorce
- Most states forbid, but permit settlements
- RULES don’t expressly permit, but don’t love
- R.1.7 still applies
- whether conflict is consentable depends on circumstances (key q = is it antagonistic?)