Duty of Loyalty Flashcards
Conflict of Interest with Current Client
A lawyer owes client duty of loyalty and must avoid conflicts of interest.
Generally must NOT represent client IF there is a significant risk that representation will be materially limited by lawyer’s personal interests or by lawyer’s duties to another client, former client, or third person
Duty of Confidentiality: Furthermore, a lawyer must:
* not use information relating to the representation to a former client’s disadvantage except as permitted or required by the Rules or when the information has been generally known, and
* not reveal information relating to the representation of a former client except as permitted or required by the Rules.
Lawyer not prohibited from taking inconsistent legal positions in separate representations.
ABA Remedy to Current Client COI
CA difference?
Even if there is COI with current client, lawyer can still undertake representation IF:
* (i) lawyer reasonably believes that she can competently and diligently represent each affect client despite the conflict
* (ii) representation is not prohibited by law
* (iii) representation doesn’t involve asserting claim by one client against another client represented by the lawyer in the same proceeding; and
* (iv) each affected client gives informed consent, confirmed in writing
California Rule is the SAME, except it requires informed written consent (both lawyer’s disclosure and client’s consent must be in writing)
Personal Relationship (CA)
- Problematic friendships
- Problematic membership of an association/organization
- Lawyer has a personal interest in a topic or right
- Potentially have to depose/c-x friends or family
- Friends/family might try and influence lawyer
California Rules include an extra provision for lawyer’s personal relationships.
If a lawyer has a personal, legal, business, financial, or professional relationship with a party or witness in the client’s matter, the lawyer must provide written disclosure to the client even if there is NO significant risk that the relationship would materially limit the representation.
* If there IS a significant risk of material limitation, informed written consent required.
Conflict of Interest with Joint Representation
Joint representation creates a significant risk that the lawyer’s representation of each client will be materially limited by the interests of the other.
* Arguing for one party could amount to arguing against the other.
* Lawyer must obtain informed consent from each client regarding the joint representation.
If there is a high risk that clients will become adverse to each other during the representation, it is unlikely that lawyer could have reasonably believed she could represent all three competently and diligently.
Here, lawyer simultaneously represents [A, B] in a dispute regarding [__]
Conflict of Interest with Former Client
A lawyer who has formerly represented a client in a matter must NOT thereafter represent another person in the:
* same or substantially related matter
* in which that person’s interests are materially adverse to the interests of the former client
* UNLESS the former client gives informed consent, confirmed in writing
Duty of Confidentiality: Furthermore, a lawyer who formerly represented a client in a matter must
* not use information relating to the representation to the former client’s disadvantage except as permitted or required by the Rules or when the information has been generally known, and
* * must not reveal information relating to the representation except as permitted or required by the Rules.
Who is the former client?
* Remember, lawyers represent CORPORATIONS, not shareholders/directors of a corporation.
* Same for partnerships - if the lawyer represented the PARTNERSHIP, lawyer is not barred from representing an interest adverse to a PARTNER.
When is a matter “substantially related”
(a) they involve the same transaction or legal dispute, or
(b) there is a substantial risk that confidential factual information normally obtained in the prior representation would materially advance the current client’s position in the subsequent matter
Malpractice Claim
Ex. General release of liability
A lawyer must not settle a claim or potential claim for malpractice liability with a client or former client without:
* Advise in writing
* Client should seek independent counsel
* Give client reasonable time to consult with independent counsel
Sexual Relationship
Under the ABA Rules, a lawyer must not have a sexual relationship with a client.
* Rule applies even if the relationship is consensual, and even if the client is not harmed
* Sole Exception: Lawyer and client had consensual sexual relationship before the lawyer-client relationship began.
California Rule is the same, except it contains an additional exception for when the lawyer and client are **spouses or registered domestic partners. **
Conflict of Interest with Government Employee –> Law Firm
What is “matter” and what does it generally not include?
A lawyer generally must NOT represent a client in connection with a matter in which
* lawyer participated personally and substantially as a government officer or employee
* UNLESS appropriate government agency gives informed consent, confirmed in writing.
As used in this rule, “matter” means a specific set of facts involving specific parties.
* Researching and drafting general legislation usually does not constitute a “matter” for purposes of this conflict rule.
Imputation of Conflicts
What about for gov employee?
If a conflict of interest does exist with respect to the lawyer’s representation of the client and the lawyer is disqualified, the firm can take steps to ensure the matter can be assigned to a different lawyer within the firm:
* Screen disqualified lawyer from participation in the matter
* Do not share any part of fees earned in the matter with the disqualified lawyer (other than normal salary/partnership share)
Government employee: Promptly notify appropriate government agency of screening arrangement so agency can ensure screening is adequate
Screen: disqualified lawyer must not talk about the matter with the lawyers who are handling it and must not have access to files about the matters
Former Client Conflict
Current Client Conflict
Prospective Client Conflict
Gifts
(a) Lawyer can’t solicit substantial gift from client
(b) Lawyer can’t prepare instrument for client that gives substantial gift to lawyer
* CA: allows this if client was advised by independent lawyer that provided certificate
Exception: lawyer and client are related
Duty to Organizations
Lawyer has duty of loyalty to the organization, not its constituents. Lawyer must explain this to constituent when org’s interests are adverse to constituent’s.
