A Sex Rule

Earlier this week, the Professional Responsibility Board forwarded to the Vermont Supreme Court its recommendation that the Court amend Rule 1.8 of the Vermont Rules of Professional Conduct as follows:

  • (j) A lawyer shall not have sexual relations with a client unless a consensual sexual relationship existed between them when the client-lawyer relationship commenced.

31 states have a specific ban on client-lawyer sexual relationships.  As of now, Vermont does not.

Rather, in Vermont, for a sexual relationship with a client to be an ethics violation, the lawyer must do something else wrong. That is, disciplinary counsel would have to prove, for example, that the relationship created an impermissible conflict of interest under Rule 1.7(a)(2). The conflict being the risk that the relationship would materially limit the lawyer’s duties to the client.

The notion that a sexual relationship crosses the line only if leads to another violation is codified in Comment [17] to the current version of Rule 1.8:

  • “The relationship between the lawyer and client is a fiduciary one in which the lawyer occupies the highest position of trust and confidence.  The relationship is almost always unequal; thus, a sexual relationship between and client can involve unfair exploitation of the lawyer’s fiduciary role, in violation of the lawyer’s basic ethical obligation not to use the trust of the client to the client’s disadvantage.  In addition, such a relationship presents a significant danger that, because of the lawyer’s emotional involvement, the lawyer will be unable to represent the client without impairment of the exercise of independent professional judgment.  Moreover, a blurred line between the professional and personal relationships may make it difficult to predict to what extent client confidences will be protected by the attorney-client evidentiary privilege, since client confidences are protected by privilege only when they are imparted in the context of the client-lawyer relationship.  For all of these reasons, lawyers are cautioned that sexual relations with a current client could give rise to claims of incompetence under Rule 1.1, of lack of diligence under Rule 1.3, of a conflict with the lawyer’s personal interests under Rule 1.7(a)(2), of using client information to the client’s disadvantage under Rule 1.8(b), of conduct involving dishonesty or the like under Rule 8.4(c), or of conduct prejudicial to the administration of justice.”

The PRB disagrees.  The Board’s position is that the imbalance of power inherent in the professional relationship between lawyer and client necessitates an absolute ban on a sexual relationship between the two.  At least 19 other of Vermont’s licensed professions have just such a ban.

The Court will consider the Board’s proposal at its next administrative meeting.  After that, the proposal might be published for notice & comment.  If you are interested in the topic, please keep an eye on the memos to the bar that the State Court Administrator sends via e-mail. Proposed rules are published in those memos.

For further reading, here are my previous blogs on the issue:

salt-n-pepa

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Monday Morning Answers: #88

I apologize for not posting this earlier.

Friday’s questions are HERE.  Spoiler alert, the answers follow this week’s Honor Roll.

Apparently, not many of my readers are NASCAR fans.  Kudos to Penny Benelli, Beth DeBernardi, and Erin Gilmore for recognizing that Friday’s picture was of Dale Earnhardt, Jr. and me.  Junior drives the 88.

Junior 88

Honor Roll

  • Laura Anderson, Nursing Supervisor, Mt. Ascutney Hospital & Health Center
  • Matt AndersonPratt Vreeland Kennelly Martin & White
  • Penny Benelli, Dakin & Benelli
  • Alberto BernabeLaw Professor, John Marshall Law School
  • Beth DeBernardi, Administrative Law Judge, Vermont Dept. of Labor
  • Erin GilmoreRyan Smith & Carbine
  • Robert Grundstein
  • Aileen LachsMickenberg, Dunn, Lachs & Smith
  • Samantha LednickyDowns Rachlin & Martin
  • Kevin LumpkinSheehey Furlong & Behm
  • Lon McClintockMcClintock Law Office
  • Hal Miller, First American
  • Robyn SweetCore Registered Paralegal, Cleary Shahi & Archer

Answers

Question 1

Prospective Client consults in good faith with Lawyer, with an eye towards retaining Lawyer.  However, Client chooses not to retain Lawyer.  Client notifies Lawyer of the decision.

Per the rules, Lawyer continues to owe Prospective Client a _____________, but in a somewhat relaxed fashion as compared to a former client.

  • A.   Duty of Loyalty
  • B.   Duty to Maintain Client’s Confidences
  • C.   Neither A nor B
  • D.  Both A & B

I don’t think I phrased the question well.  Here’s what I was trying to help people to think about.

Rule 1.18 sets out the duties that a lawyer owes to a “prospective client.”  A prospective client is one who consults with a lawyer in good faith and with an eye towards retaining the lawyer, but who, for whatever reason, does not retain the lawyer.

The duty to maintain the prospective client’s confidences continues to apply and IS NOT relaxed.  Rule 1.18(b) says:

  • “Even when no client-lawyer relationship ensues, a lawyer who has had discussions with a prospective client shall not use or reveal information learned in the consultation, except as Rule 1.6 would require or permit or as Rule 1.9 would permit with respect to information of a former client.”

In other words, I read the duty to maintain the prospective client’s confidences to apply to the same extent & degree as it would apply if the client was a former client.

Further, I read the rule as relaxing, however little, the duty of loyalty as compared to the duty of loyalty owed to a former client.

With respect to a former client, Rule 1.9(a) makes it clear that a lawyer cannot represent someone whose interests are materially adverse to those of a former client in the same or a substantially related matter unless the former client gives informed consent, confirmed in writing.

Rule 1.18 is different.  Specifically, Rule 1.18(c) states that “a lawyer subject to paragraph (b) shall not represent a client with interests materially adverse to those of a prospective client in the same or a substantially related matter if the lawyer received information from the prospective client that could be significantly harmful to that person in the matter, except as provided in paragraph (d).”  (emphasis added).  There’s no such proviso in Rule 1.9, the rule that applies to former clients.

In other words, as I read the rule, it’s not as strict as Rule 1.9 and applies only if the lawyer received information that could be significantly harmful to the prospective client. And, even then, paragraph(d) permits a firm to screen the lawyer who consulted with the prospective client.  Normally, a former-client conflict under Rule 1.9 is imputed to all other lawyers in the firm by Rule 1.10 and, therefore, screening is not allowed. That’s another reason why I consider Rule 1.18 to relax the duty of loyalty.

Question 2

Which must a lawyer keep for 6 years following the termination of a representation?

  • A.   The file
  • B.   Client confidences
  • C.   Complete records of funds held in trust and other property
  • D.  Electronic communications with the client

The rules require the file to be delivered upon the termination of the representation.  Rule 1.16(d).  There is no duty to keep a copy. Of course, it’s a good idea to do so and, odd are, your liabilit insurance requires you to.

 Confidences must be kept forever, unless a client consents to disclosure or the information has become “generally known.”  See, Rule 1.9(c). 

Electronic communications are part of the file and there is no independent rule requiring them to be kept.

Rule 1.15(a)(1) requires lawyers to follow the trust account rules and prohibits commingling.  It states that “[c]omplete records of such account funds and other property shall be kept by the lawyer and shall be preserved for a period of six years after termination of representation.”

Question 3

Attorney called me with an inquiry.  I listened, then said:

  • “Client hasn’t paid in 8 months? Assuming nothing crucial is imminent, my position is that you’re permitted to file the motion.  Whether the court grants it is another question.  The question will be whether there will be a material adverse effect on your client.”

What type of motion?

Motion to Withdraw, See V.R.Pr.C 1.16(b)

Question 4

Attorney represents Irving in the civil matter Irving v. James.   Lawyer represents James and has retained Expert Witness.

Whether Attorney can contact Expert Witness without Lawyer’s permission is likely governed by:

  • A.  Rule 4.2 (the no-contact rule)
  • B.  Rule 1.6 (information relating to the representation)
  • C.  The Rules of Civil Procedure
  • D.  The Rules of Evidence

An expert witness is not represented by the lawyer who represents the party or person for whom the witness will be testifying. So, Rule 4.2 does not apply.

However, Rule 26 of the Rules of Civil Procedure limits the ways in which discovery may be obtained from an expert witness.  Contacting that witness informally might not be one of them.  Thus, in the hypo, Rule 26 answers the question. And, remember, a violation of the Rules of Civil Procedure might rise to the level of a violation of Rule 3.4(c) of the Rules of Professional Conduct.

Question 5

When we first met Mike Ross, he hadn’t gone to college or law school, but was earning money by taking (and passing) the LSAT for others.  Then, to earn money to pay for his grandmother’s medical care, Mike agreed to deliver marijuana for a friend.  Somehow he managed not to be arrested in the ensuing sting and, almost impossibly, ended up with a job interview at a law firm.

He was hired.  As a lawyer. Even though Harvey, the partner who interviewed him, knew that Mike had not taken the bar exam or been admitted to practice.

After several years in practice, Mike was charged criminally with fraud & the unauthorized practice of law.  While the jury deliberated, Mike agreed to a plea offered by Anita, the U.S Attorney who was prosecuting him.

After serving a prison stint, Mike passed the bar, with only review by the Character & Fitness Committee standing between him and admission.  Yikes! Guess who bribed her way onto the committee charged with reviewing his application??? Anita!!  She did so not only to keep Mike out, but to try to prove her theory that Harvey (and others) had known all along that Mike wasn’t a lawyer!

Amazingly, Mike was admitted and spent the show’s most recent season as a duly licensed member of the New York State Bar.

Name the tv show.

Mike Ross is a lawyer in Suits.  

Ross Suits

 

 

 

Monday Morning Answers – #84

Happy Labor Day!

Friday’s questions are HERE.  The answers follow today’s Honor Roll

Thanks to all who offered encouragement in Saturday’s race.  It went well and the Clemson game was fantastic.  Watching the Tigers “touch the rock” and run down the hill for the first time since last year’s national championship was electric.   And we didn’t have bad seats:

IMG_2512

Honor Roll

Answers

Question 1

The rules do not require lawyers to have succession plans. However, a comment to a particular rule suggests that it’s a violation for a sole practitioner not to have a plan that designates another lawyer to review the solo’s files and contact the solo’s clients in the event of the solo’s death, disability, or unavailability.  It’s the rule on:

I used this question as a reminder following Hurricane Harvey.  Remember – there are many ways in which a solo might become unavailable.  Seminars often focus on the doom & gloom of death or disability.  Yes, those things happen.  But, if you’re traveling and a weather emergency keeps you from getting home for a few extra days, can your clients make it without you?

Question 2

Valerie and Eddie divorced many years ago.  Eddie is over a year in arrears on court-ordered spousal maintenance payments.

Valerie asks Lawyer to represent her in a motion to enforce the order.   She cannot afford Lawyer’s fee and asks Lawyer to take the case on a contingent fee basis.  Lawyer agrees.  You may assume that Lawyer does not have any conflicts that prohibit Lawyer from representing Valerie.

Which is most accurate?

  • A.   If the contingent fee agreement is reasonable & reduced to writing, it does not violate the rules.  V.R.Pr.C. 1.5(d)(1)(i)
  • B.   Lawyer has violated the rules.  Contingent fees are banned in domestic cases.
  • C.   There will not be a violation unless or until Lawyer attempts to collect a contingent fee from Valerie.
  • D.   There is no violation because it was Valerie, the client, who proposed the contingent fee.

Here’s a very simple way to help provide access to legal services: the rules clearly allow contingent fees in certain post-judgment family cases.  Rule 1.5(d)(1)(i) allows them in cases involving past due maintenance & property division, while subsection d(1)(ii) allows contingent fees, with court approval, when child support is past due.

DO NOT say to me “but Mike, I’ll never make a difference with access by taking a post-judgment spousal maintenance case on a contingent fee.”   You will make a difference to that client.  And, while this is likely best addressed in a blog of its own, my opinion is that, as a profession, we too often let perfect be the enemy of the good.  Instead of forming commission after study commission after blue-ribbon commission, we should strive make a  difference whenever and wherever we can, no matter how small “whenever and wherever” seems.  Like to the one client who you represent on a contingent fee basis in a post-judgment matter where court-ordered spousal maintenance is past due.

Question 3

Lawyer represents Organization.  Lawyer leaves Organization for private practice.

True or false:   Lawyer’s general knowledge of Organization’s practices and procedures ordinarily will preclude Lawyer from representing a party adverse to Organization.

False.  See, V.R.Pr.C. 1.9, Comment [3].  As Professor Alberto Bernabe puts it, “being familiar with the organization’s ‘playbook’ does not typically disqualify the lawyer.”

Question 4

Rule 8.4 prohibits some types of conduct that do not involve the practice of law.  Although it no longer appears in the text of the rule, what’s the 2-word term used to draw the distinction between non law-related conduct that violates the rules and non law-related conduct that does not? Conduct involving ” ________  ___________.”

“Moral Turpitude.”  V.R.Pr.C. 8.4, Comment [2].  A phrase that drove me nuts in the old days!  Professor Bernabe has some great posts on the continued use of the phrase in the rules.

Question 5

This is a fictional scenario.  A prop device, if you will.  Play along.

I received an ethics complaint from a woman complaining how her brother was treated in a criminal case.  The thrust of her complaint was that her brother was framed for the murder of his best friend, Andy, who had just confessed to an affair with her brother’s “cheatin’ wife.”

Referring to her brother’s defense attorney, she wrote that her brother never should’ve “trusted his soul to no backwoods southern lawyer.”  She alleged that the proceeding was “a make believe trial” and that the “judge in this town has got blood stains on his hands.”

Interestingly, her brother WAS framed! In fact, the sister is the one who did it! Not only did she admit to killing Andy, she wrote that her brother’s “cheatin’ wife had never left town and that’s one body that’ll never be found.” It’s the first complaint I’ve ever received in which the complainant confessed to a crime.

Anyhow, Vermont’s Professional Responsibility Program and Judicial Conduct Board don’t have jurisdiction over the defense attorney and judge.

Name the state to which I referred the complainant.

Georgia.  The question refers to the AM smash The Night Light The Lights Went Out in Georgia.  After Liza Minelli and Cher turned it down, one-hit wonder Vicki Lawrence took it to #1.  As a few readers mentioned, once the title-line gets in your head, good luck getting it out.

Finally, Friday’s questions included a reference to Johnny I Hardly Knew Ye by The Irish Rovers.  My apologies to the (several) readers who prefer The Dropkick Murphys’ version.

 

So A Lawyer & Judge Are Facebook Friends . . .

So a lawyer & judge are Facebook friends.

So what?

The ABA Journal has the story of an appellate court’s decision that a Facebook friendship with a lawyer, without more, is not a sufficient basis to disqualify a judge.   The order is here.

This makes sense to me.  As with almost everything tech-related, I try to use analogies to non-tech stuff.  For example, if you learned that a lawyer who regularly appeared before a judge belonged to the same health club, or went to the same church, or was in the same law school class as the judge my guess is that you wouldn’t reflexively yell “conflict! disqualify the judge!”

No, you might ask something as simple as, “do they actually know each other? If so, how well? Do they do stuff together?”

In my view, Facebook is no different.  Florida’s Third District Court of Appeal agrees. (there’s no “s” – maybe the court only hears one case at at time).  The opinion presents a fantastic analysis of what it means, if anything, to be Facebook friends with someone.

Here are my favorite paragraphs from the ABA Journal’s post.  They include a quote from the opinion.

“Though a Facebook friendship may have once given the impression of a close friendship, that’s no longer the case, the Third District Court of Appeal said in explaining its disagreement with the other appeals court. Facebook uses data mining and network algorithms to suggest potential friends, and many Facebook users have thousands of friends, the appeals court said.

“ ‘To be sure,’ the opinion said, ‘some of a member’s Facebook ‘friends’ are undoubtedly friends in the classic sense of person for whom the member feels particular affection and loyalty. The point is, however, many are not. A random name drawn from a list of Facebook ‘friends’ probably belongs to casual friend, an acquaintance, an old classmate, a person with whom the member shares a common hobby, a ‘friend of a friend’ or even a local celebrity like a coach.’ ”

Ab, yes. A local celebrity.  Like a coach.  Music to my ears.

Monday Morning Answers #83

Friday’s questions are HERE.

Spoiler alert: the answers follow today’s Honor Roll in 5, 4, 3, 2, 1……if you don’t know, now you know.

Honor Roll

Answers

Question 1

There’s only ONE thing that the rules require Vermont lawyers to keep for a period of years.  What is it?

  • A.   Copies of advertisements for 2 years after they first run.
  • B.   Client’s file for 7 years following the termination of the representation of Client.
  • C.   Trust account records of funds held for Client for 6 years following the termination of the representation of Client.  Rule 1.15(a)(1).
  • D.   Client’s confidences & secrets for 7 years following the termination of the representation of client.

Notes:  A is incorrect because the rule was repealed years ago.  B is NOT CORRECT.  The file must be delivered upon the termination of the representation.  See, Rule 1.16(d).  It’s a good idea to make a copy for yourself, but the rules do not require you to do so.  Your carrier probably does though.  Finally, D is not correct.  We stopped using the word “secrets” in 1999.  Also, information relating to the representation of a former client is governed by Rule 1.9(c) and is not subject to a 7-lear limit.

Question 2

Attorney called.  Among other questions on a single topic, she asked me whether the rules define “person of limited means.”  What general topic did Attorney call to discuss?

The pro bono rules.  Per rule 6.1, a majority of the 50 hours should go to providing representation to persons of limited means, or, to organizations that primarily address the needs of persons of limited means.  For more, including the definition of “persons of limited means” see this blog post.

Question 3

Speaking of encrypting email, if there is a duty to encrypt, it flows from two duties set out in the rules. One is the duty to maintain the confidentiality of information related to the representation.  What’s the other?  The duty to:

  • A.  Safeguard client property & funds
  • B.  Provide a client with diligent representation
  • C.  Provide a client with competent representation.  See, Rule 1.1.  Also, the link to my blog on encrypting email was included with the questions.  It outlines how the duty of competence dovetails with the duty to maintain confidences to include a duty to act competently to safeguard information relating to the representation of a client.
  • D.  Communicate with a client

 

Question 4

Lawyer represents Client.   Shortly before trial, opposing party discloses Witness. Lawyer determines that he has a conflict that prohibits him from representing Client in a matter in which Witness will testify for Opposing Party.

Lawyer moves to withdraw and discloses the conflict in both his motion and the argument on the motion.  The court denies the motion and Lawyer represents Client at trial.  Witness testifies, Lawyer cross-examines Witness.

True or False: Lawyer violated the Vermont Rules of Professional Conduct by representing Client at trial and cross-examining Witness.

False.  Rule 1.16(c).  (“When ordered to do so by a tribunal, a lawyer shall continue representation nothwithstanding good cause for terminating the representation.)

Question 5

I’m not making this up.

In Vermont, V.R.Pr.C. 3.1 is the equivalent of civil rule 11.  It prohibits lawyers from asserting a position unless there is a non-frivolous basis for doing so.

I’m not making this part up either.

In 2014, a New York lawyer was sued for allegedly helping a client to fraudulently transfer assets.  Let’s call the lawyer “Defendant.”

In 2015,  Defendant filed a motion in which he requested the he and plaintiff either have a duel or “trial by combat.”  When questioned by the media, he responded that “”I have a good-faith belief that this is still part of our state constitution. I want the law to be clear on this issue, and I have every right to ask for this.”

What’s Defendant’s favorite television show?

Game of Thrones.

The lawyer’s request was denied.  In an article on the denial, Staten Island Live has a fascinating quote from Attorney Richard Luthmann:

  • “I believe that the court’s ruling is based upon my adversaries’ unequivocal statement that they would not fight me,” said Luthmann, who’s based in Castleton Corners.  “Under my reading of the law, the other side has forfeited because they have not met the call of battle. They have declared themselves as cowards in the face of my honorable challenge, and I should go to inquest on my claims.”

Trial by Combat

 

 

 

The More Things Change…

Since becoming bar counsel in June 2012, I’ve handled 4,421 ethics inquiries.  By far, the most common inquiry topic has been conflicts of interest.  Questions relating to conflicts have accounted for slightly more than half of all inquiries, with “former client” conflicts constituting the largest subset within the category.  Common questions:

  • Can I take a case against a former client?
  • I represent Buyer. I’ve known Seller for years.  She wants me to represent her. Can I?
  • For the past 10 years or so, I’ve represented a couple. Business stuff, some trusts, a small PI claim, nothing that either doesn’t know about.  They’re getting divorced.  Can I represent Wife?

This morning I realized that I needed to post today.  I was too busy watching the early coverage of The British Open to concentrate, so I figured I’d cheat with a “Throwback Thursday” post.

In between putts & wayward drives, I wondered what issues bar counsel types were dealing with 50 years ago.  So, I searched “legal ethics 1967.” I figured I’d find something simple, and post “here’s what was going on a long time ago.”

The top result was a compendium of the ethics opinions issued by the Indiana State Bar Association in 1967.

Opinion 1 is the genesis of this post’s title.

(Apparently, in 1967, lawyers had yet to resolve to use 37 words when 1 would do.  So, here’s the opinion, in its entirety.)

Opinion No. 1 of 1967
Lawyer Not Forever Barred From
Taking Case Against A Former Client

The Committee was asked its opinion by an attorney whose present
client wished to bring suit against a person who at one time had
been a client of the attorney.

Mr. Henry S. Drinker, in his book Legal Ethics, at page 112, stated:
“One may sue a former client if his representation is ended and. the
matter does not involve confidential communications.” An attorney
is not forever barred from suing a former client, so long as the present
matter was not connected with, and did not arise out of, the former
employment, and so long as there is no breach of confidential information
obtained during the former attorney-client relationship.

The opinion mirrors today’s rule.

Rule 1.9 prohibits a lawyer from representing a person:

  • in the same or a substantially related matter in which the lawyer represented a former client and in which the person’s interests are materially adverse to the interests of a former client, unless the former client gives informed consent, confirmed in writing.

Even if the matters are not the same or substantially related, Rule 1.9(c) prohibits a lawyer from using or revealing information relating to the representation of a former client.

Nothing has changed.

Next, I wondered what Vermont’s hot  topics in ethics were back in the day.  The Vermont Bar Association publishes advisory ethics opinions.  The earliest available are from 1978.  (As regular reader Hal Miller knows, it was a year that shall forever live in infamy on this blog.  More on that tomorrow.)

The VBA released 3 advisory ethics opinions in 1978.  They dealt with conflicts, conflicts, and conflicts.  Two of the three involved questions I continue to receive to this day.

Opinion 78-04 concluded that it is improper to represent both buyer & seller in real estate transaction.  I agree with the conclusion.

Opinion 78-03 concluded that it is improper for a lawyer who has represented a couple to represent one in a divorce if the issues in the divorce are substantially related to the former representation of the couple.  Again, I agree.  Comment 3 to Rule 1.9 addresses this very question.

I’m not complaining. If you have questions about a potential conflict, don’t hesitate to call, text, or e-mail.  I bring it up only because I’m struck by the fact that conflicts always have been and likely always will be the most common, but trickiest, ethics issue confronted by lawyers.

Actually, let’s be honest: I bring it up mainly I needed to post a blog about something- anything! – to drive traffic towards tomorrow’s #fiveforfriday quiz.

conflict

 

 

 

 

 

Confused by Conflicts? Think “Tug of War”

I coached varsity basketball for 15 years.  One thing I learned is that different players have different learning styles.

For example, I’d wager that the play I ran most often in my career was one we called “Texas.”  We had various ways to start “Texas,” but the critical action always came from the same set.

Texas

 

There are different ways to teach kids a play. For some, drawing it on a whiteboard (above) was sufficient.  Others needed to watch it demonstrated on the court.  Still others had to learn by doing; that is, walk through the play on the court in order to learn it.  We’d use each method.

I don’t want you to have to walk through a disciplinary investigation in order to learn what a conflict of interest is.  However, to help you avoid conflicts, I’m not going to make you read a blog clogged with cites to Rules 1.7, 1.81.9, and 1.10.  For all I know, that wouldn’t help anyone learn anything.  Instead, I’m going to try a visual.  And that’s where “Tug of War” comes in.

Unfortunately, this is the best visual I could find.

Tug of War

Most of you should be familiar with the rules of Tug of War.  If not, look at the picture.

There are 3 white lines in the dirt.

  • Line 1 is at the feet of the guy who is at the front of the team that is closest to us.
  • Line 2 is in the middle.  The ref is standing on it.
  • Line 3 is at the feet of the team farthest from us.

There’s piece of red tape in the middle of the rope.  At the start of the match, the piece of red tape is positioned over Line 2.  The team that pulls the piece of red tape over Line 1 or Line 3 wins.

Turning to conflicts, as a lawyer, you’re the piece of red tape.  (No pun intended).

Now, let’s pretend the team at the top of the picture is your client.  If there is nobody down here at the bottom pulling you towards Line 1, it’s likely that you’re conflict-free.

But, picture this: someone or something is tugging you towards Line 1.  Who or what? Could be anything.  For purposes of this blog, I want you to imagine that the tug is a duty that you owe to someone other than your client (the team at the top of the picture). For instance:

  • duties to another client;
  • duties to a former client;
  • duties to a third person; or,
  • a personal interest of yours

That tug – someone or something pulling you away from your client – probably has interests that conflict with your client’s.  Stated differently, do the interests of the two teams in the picture align? No, they don’t.  They conflict.

Your client isn’t required to tug you towards Line 3.  Rather, your client is entitled to representation free of any conflicting interests tugging you towards Line 1.

Feeling tugged?  You might have a conflict.  You’ll need to consider whether to decline representation or, if representation has commenced, whether to withdraw.

Oh, “Texas” was a damn good play.

 

 

 

 

Attorney-Client Sex: It’s Time for a Rule

It’s time to raise this issue.  Again.

On July 10, the Professional Responsibility Board’s duties will expand to include reviewing and recommending changes to the Rules of Professional Conduct.  For many years, proposed amendments to the RPCs have flowed through the Advisory Committee on Civil Rules.

I expect that one of the Board’s first recommendations will be to propose a rule that bans attorney-client sexual relationships that do not pre-date the representation.

The Board has long felt that Vermont should join the 31 other states that have specific bans.  In January 2015, the Board recommended that the Court adopt a specific ban.  I supported the recommendation, as did then disciplinary counsel.  At the time, each of us had more than 13 years of experience prosecuting disciplinary cases, and first-hand experience with the challenges posed by the lack of a bright-line rule when prosecuting a lawyer who exploits the attorney-client relationship.

Please take the time to answer this poll question: should the PRB propose a rule that specifically bans lawyer client sexual relationships?  You can vote HERE.

Need information before you vote?  I blogged on the issue HERE and HERE.   For the click-averse, I’m pasting in the blog that I posted in December 2015.  It recounts the history of the Board’s efforts to pass a “bright-line” rule and includes some of the arguments for & against an affirmative ban.

*************

The ABA has adopted Model Rules of Professional Conduct.  For the most part, Vermont’s rulestrack the model rules.  When it comes to sexual relationships between lawyers and their clients, Vermont’s rules do not track the model rule.

The model rules include a specific ban on client-lawyer sexual relationships.  It’s in Model Rule 1.8(j).  It reads:

  • “(j) A lawyer shall not have sexual relations with a client unless a consensual sexual relationship existed between them when the client-lawyer relationship commenced.”

Thirty-one states have followed the ABA’s lead and adopted specific bans on client-lawyer sexual relationships.  Vermont has not.

While not specifically prohibited by rule, Comment [17] to V.R.Pr.C. 1.8 addresses the “Client-Lawyer Sexual Relationship.”  It’s wordy, but important. It says:

  • “The relationship between the lawyer and client is a fiduciary one in which the lawyer occupies the highest position of trust and confidence.  The relationship is almost always unequal; thus, a sexual relationship between and client can involve unfair exploitation of the lawyer’s fiduciary role, in violation of the lawyer’s basic ethical obligation not to use the trust of the client to the client’s disadvantage.  In addition, such a relationship presents a significant danger that, because of the lawyer’s emotional involvement, the lawyer will be unable to represent the client without impairment of the exercise of independent professional judgment.  Moreover, a blurred line between the professional and personal relationships may make it difficult to predict to what extent client confidences will be protected by the attorney-client evidentiary privilege, since client confidences are protected by privilege only when they are imparted in the context of the client-lawyer relationship.  For all of these reasons, lawyers are cautioned that sexual relations with a current client could give rise to claims of incompetence under Rule 1.1, of lack of diligence under Rule 1.3, of a conflict with the lawyer’s personal interests under Rule 1.7(a)(2), of using client information to the client’s disadvantage under Rule 1.8(b), of conduct involving dishonesty or the like under Rule 8.4(c), or of conduct prejudicial to the administration of justice.”

(Okay, although this is a serious topic, lawyers don’t need to be so serious all the time. So, an aside: the very first “caution” against sexual relationships with clients was that such relationships might give rise to claims of incompetence.  The unintentional comedy is hilarious.)

In any event, in Vermont, for a sexual relationship with a client to be an ethics violation, the lawyer must do something else wrong. That is, disciplinary counsel would have to prove, for example, that the relationship created an impermissible conflict of interest under Rule 1.7(a)(2).  The conflict being that risk that the relationship would materially limit the lawyer’s duties to the client.

In 2009, the Civil Rules Committee amended some of Vermont’s ethics rules so as to conform with the ABA Model Rules.  The Committee intentionally omitted Mode Rule 1.8(j).  According to the Reporter’s Notes to the 2009 Amendments, the

  • “omission [was] based on the grounds that an absolute prohibition of lawyer-client sexual relations is both an invasion of privacy and a duplication of the effect of other rules requiring loyal and competent representation, as noted in the revised text of Comment [17].

Earlier this year, the Professional Responsibility Board (“PRB”) recommended a series of amendments to the Rules of Professional Conduct.  The recommendation included a proposal that the Supreme Court amend V.R.Pr.C. 1.8 to include the following language:

  • “A lawyer shall not have sexual relations with a client unless a consensual sexual relationship existed between them when the client-lawyer relationship commenced.”

The full text of the recommendation with respect to Rule 1.8 is HERE.

The Court forwarded the PRB’s recommendations to the Civil Rules Committee.

With one exception, the Civil Rules Committee voted to send the  PRB’s recommendations out for notice, comment, and possible adoption.  The exception:  the proposal to amend Rule 1.8 so as to include a specific ban on client-lawyer sexual relationships.

As I understand it, the Committee’s position is the same as it was in 2009, and that is outlined in the Reporter’s Notes to the 2009 Amendments to Rule 1.8.  That is, there is no need for specific ban, that client-lawyer sexual relationships can be prosecuted under other rules.

The upshot: the PRB’s recommendation that the Court adopt a per se ban on client-lawyer sexual relationships was rejected and not published for notice & comment. (note: the Committee voted to publish other proposals from the PRB for notice & comment. Those proposals are HERE).

The debate over whether the ethics rules should include a specific ban on client-lawyer sexual relationships is not new or limited to Vermont.  In 1993, the New Hampshire Bar Association’s Ethics Committee weighed in.  The debate raged in Texas in 2010, with bar eventually rejecting a proposal to enact a specific ban.  Commenting on the Texas debate, this blog post raises various arguments in favor of a per se ban, while this advisory opinion from Virginia, although not calling for a per se ban, sets out “the host of ethical problems” that arise when lawyers and clients have sexual relationships.

To summarize, some of the arguments for a specific ban:

  • protects vulnerable clients from exploitation, coercion, undue influence;
  • keeps lawyers  from providing advice based on clouded judgment;
  • treats lawyers the same as most other licensed professions;
  • it’s clear, not complicated, leaves no wiggle room; and

Some of the arguments against a specific ban:

  • the existing rules work;
  • unnecessary invasion of privacy;
  • jilted clients will file frivolous malpractice/ethics complaints;
  • what about situations in which there’s no danger of a conflict or any other violation?  For example, corporate counsel and CEO, or a lawyer and a sophisticated transactional client.

Question_mark

 

So You Want to Represent Both Buyer & Seller?

Facts:  Mother owns home.  Mother wants to sell home to Son.  Mother & Son agree on the details, without the assistance of counsel.  Mother and Son ask Attorney to handle the purchase & sale, and to represent each of them at closing.

Wait a minute! Is it already April 1?  Mother & Son agreeing on details – of anything – without the assistance of counsel? In what crazy world does that happen?!?!

Anyhow, I digress.  Does Attorney have a conflict? If so, can it be waived?

According to IIlinois State Bar Professional Conduct Opinion 2017-04, the answer is yes there’s a conflict, and it likely cannot be waived.

According to the Illinois State Bar:

  • Representation of a buyer in a real estate transaction is directly adverse to representation of a seller.
  • Thus, Attorney has a conflict.
  • It is not reasonable for Attorney to believe that Attorney will be able to provide competent and diligent represntation to both Mother & Son.
  • Thus, the conflict cannot be waived.

A few relevant passages from the opinion:

  • “Pursuant to Rule 1.7(b)(1), the lawyer must analyze whether the lawyer may reasonably believe that the lawyer will be able to provide competent and diligent representation to each affected client. The question is whether a reasonable lawyer would conclude that the lawyer could provide the required diligence and competence to both the buyer and the seller in the transaction.”
  • ” In our view, if the buyer and the seller have not already executed a valid sales contract, the lawyer could not reasonably believe that he or she could provide competent and diligent representation to both the buyer and the seller. The lawyer could not negotiate on behalf of one client without harming or potentially harming the other client. The lawyer’s obligations and loyalties are so divided that the lawyer could not reasonably believe that the lawyer could provide adequate representation to both parties.”
  • “Even if the parties agree on the terms of the sale, and have already executed the sales contract, we believe that it is highly unlikely that a lawyer could properly represent both the buyer and seller in concluding the transaction. Issues often arise “after the parties have executed the contract and prior to closing that would require the lawyer to give unqualified advice to his or her client.”

Vermont’s Rule 1.7 is identical to the Illinois rule.  In Vermont, “a lawyer shall not represent a client if the representation involves a concurrent conflict of interest.”  Rule 1.7(a).  A concurrent conflict exists:

  • if the representation of a client will be directly adverse to another; Rule 1.7(a)(1), or,
  • if there is a significant risk that the representation of a client will be materially limited by the lawyer’s responsiblities to another. Rule 1.7(a)(2).

So, in Vermont, Attorney has a concurrent conflict:

  • if the representation of Mother will directly adverse to Son; or,
  • if there is a significant risk that the representation of Mother or Son will be materially limited by Attorney’s duties to the other.

If a concurrent conflict exists, Vermont’s 1.7 allows it to be waived if 4 criteria are met. The first is in Rule 1.7(b)(1): Attorney must reasonably believe that Attorney will be able to provide competent and diligent representation to both Mother and Son.

The Illinois State Bar concluded that it would not be reasonable for Attorney to believe such a thing. The opinon cites to the VBA Advisory Ethics Opinion 2004-3.

In the VT opinion, the Vermont Bar Associatioin’s Professional Responsibility Committee concluded that “an attorney may not simultaneously represent a client who is selling a parcel of real property and provide limited representation to the buyer of the same real estate by providing a title insurance policy to such buyer.”

The opinion is not exactly on point with the hypo with which I started this post.  However, the Committee went through exactly the correct analysis. Is there a concurrent conflict? If so, can it be waived.

In addressing the questions, the Comittee referred to an advisory opinion it had issued in 1978: VBA Advisory Ethics Opinion 78-04.  The opinion was rendered pursuant to the old Code of Professional Responsibility, the rules that governed until September 1, 1999.  Under the Code, even when faced with a conflict, a lawyer was allowed to “represent multiple clients if it is obvious that he can adequately represent the interest of each and if each consents to the representation after full disclosure of the possible effect of such representation on the exercise of his independent professional judgment on behalf of each.”  Code of Professional Responsibility, DR-5-105(C).

The Committee concluded that the rule’s two phrases had equal meaning.  That is, “[i]t is important to emphasize, however, that consent – even if knowledgeably given – is not a general panacea to conflicts of interest. It will only vitiate the conflict if ‘it is obvious that [the lawyer] can adequately represent the interest of each.’ ”

From there, the 1978 Committee concluded that:

  • “It is difficult to see how a lawyer could ever make full disclosure in the real estate area given the myriad of problems that may arise. Moreover, real estate transactions often involve parties of different legal sophistication and disclosures suitable to one may be insufficient for the other.”

And, that

  • In [its view], the Committee reaffirms its position that representation of both purchase and seller in a normal ‘arms-length’ real estate transaction is unethical, at least when the representation of neither side is in any way limited.”

Now, perhaps times have changed. And, as did the Illinois and Vermont comittees in each of the three opinions I cited to in my blog, I am not going to try to list each and every situation in which a waiver may be valid under Rule 1.7(b).

All I’m saying is this: if Attorney wants to represent both Mother and Son, I read Rule 1.7(b) as requiring that it be reasonable for Attorney to believe that he can provide competent and diligent representation to each.

As always, let’s be careful out there folks.

Hill Street Blues

 

 

 

Lateral Transfers – Is VT’s Rule too Strict? Part 2.

Last week, I blogged  on lateral transfers, imputed conflicts, and ethical screens.

Consider this hypothetical:

  • Husband and Wife are divorcing
  • Old Firm represents Husband
  • New Firm represents Wife
  • Lawyer works at Old Firm.
  • Lawyer leaves for a job at New Firm

Upon Lawyer’s transfer, will New Firm be disqualified from representing Wife?

In Vermont, the answer is “it depends.”

The applicable rule is V.R.Pr.C. 1.10(a).  The critical question is whether Lawyer participated personally and substantially in Old Firm’s representation of Husband.

  • If the answer is “yes,” the rule imputes Lawyer’s conflict to New Firm and prohibits New Firm from curing the conflict by screening Lawyer.
  • If the answer is “no,” New Firm is not disqualified, even over Husband’s objection. as long as it screens Lawyer.

Last week, comparing the rule to the more lenient ABA Model Rule 1.10, I asked readers whether Vermont’s rule is too strict. I did not receive many responses.

Lateral Transfers: Three Different Approaches

I’ll use the original hypothetical throughout this post.

Jurisdictions are split on the issue.

One approach is to impute conflicts and prohibit screening.  Under this approach, absent Husband’s informed consent to waive the conflict, Lawyer’s conflict is imputed to all attorneys in New Firm and the firm is disqualified.

Other states, allow screening, even without the former client’s consent, but with exceptions.  This is Vermont’s approach.  Lawyer can be screened, but only if Lawyer did not participate personally & substantially in Old Firm’s representation of Husband.   Similarly, New Hampshire, New Firm could screen Lawyer, unless Lawyer “had substantial involvement in, or received substantial material information about, a matter that is ongoing at the time of the firm transfer and that would be the focus of the screening procedures.”  N.H. Rule 1.10(c).  

Finally, still other states allow New Firm to screen Lawyer, even over Husband’s objection, no matter how involved Lawyer was in Old Firm’s representation of Husband.  This is the  ABA approach, as reflected in ABA Model Rule 1.10, and is often referred to as “nonconsenual screening.”

The 2009 Amendment to the ABA Model Rules

Prior to 2009, the ABA Model Rules did not allow firms to screen lateral transfers.  In our hypo, absent Husband’s informed consent to waive a conflict, Lawyer’s conflict was imputed to New Firm and New Firm could no longer represent Wife.

However, upon the recommendation of the Standing Committee on Professionalism Ethics, the House of Delegates amended the rule to allow firms to screen lateral transfers, even over the objection of the affected former client.  The Committee’s Report & Recommendaton includes a majority view and a dissenting minority opinon.

By way of summary, the majority’s points:

  • Nonconsensual screening allows lawyers to switch jobs/enjoy professional mobility.
  • Screening strikes an appropriate balance between protecting the former client’s confidences & allowing lawyers to take jobs of their choosing
  • The rules already allow screening when lawyers move to & from government employment.
  • Several states already allow screening when private lawyers switch firms.
  • Screening works, as evidenced by the lack of disciplinary complaints & prosecutions in the states that allow it.

The dissent argued against nonconsensual screening, concluding:

  • “Current rule 1.10 protects former clients against the risk of adverse use or disclosure of confidential information. The proposed amendment substitutes the law firm’s resolution of this risk for the client’s. It catapults the lawyer’s interests over the former client’s determination at precisely the time the lateral lawyer and the new firm have their own and their client’s interests understandably in mind. Lawyers should consult with former clients about these matters and be bound by the client’s determination, which is precisely what current Model Rule 1.10 requires.”  Report & Recommendation, p. 17.

Screening Procedures

Jurisidictions that allow nonconsensual screening generally require the same types of screening procedures.

in Vermont, if Lawyer did not participate personally and substantially in Old Firm’s representation of Husband, New Firm must comply with the three subsections of Rule 1.10(a)(2).  Generally, New Firm must:

  1. Screen Lawyer from any participation in the matter and not letter Lawyer share in any fee generated by the matter; and,
  2. Provide Old Firm with written notice & description of the screening procedures that New Firm will use; and,
  3. Certify compliance with the screening procedures  periodically throughout the life of the case.

The ABA/BNA Lawyers Manual on Professional Conduct has written on The Elements of an Effective Ethics Screen.

Is Screening Enough?

Nonconsensual screening raises concerns regarding loyalty and confidentiality.  In our hypo, Lawyer will have “switched sides” in the Husband v. Wife dispute, and might share information about Husband with New Firm.

It would be a violation of the rules for New Lawyer to share the information.  For example, Rule 1.9(c)(1) prohibits Lawyer from using any information to Husband’s disadvantage.  Rule 1.9(c)(2) prohibits Lawyer from revealing any information about the representation.

To some, that’s not enough.

For example, the ABA Section on Litigation published this post shortly after the ABA House of Delegates adopted Model Rule 1.10.  The post quotes a delegate who opposed nonconsensual screening as saying:

  • “Today the ABA abandoned its commitment to client loyalty and confidentiality for nothing more than an undemonstrated need for lawyer convenience . . . Today, we compromised our birth right.”

The post goes on to quote Robert L. Rothman. At the time, Rothman was the Chair of the ABA Section of Litigation.

  • “Unfortunately, under new Model Rule 1.10, clients who believe their interests are placed at risk when their former lawyer moves to an adverse law firm no longer can merely refuse to waive the conflict created by the lateral move, they must bear the burden of going to court if they wish to disqualify the former lawyer and his or her new firm,” says Rothman. “We believe the new rule undermines client loyalty and sends the wrong message to clients, who will see this as the profession placing its own economic interests ahead of the best interests of our clients.”

To others, screening is the answer, no matter Lawyer’s level of involvement with Husband’s matter at Old Firm.  In the Report and Recommendation from the ABA Standing Committee on Professionalism and Ethics,  the majority noted:

  • “Screening is not designed to impair the interests of clients, but to protect them. Screening provisions permitting private lateral screening have been adopted in nearly half the states, where hundreds of law firms and thousands of lawyers practice in cities like Baltimore, Charlotte, Chicago, Detroit, Louisville, Philadelphia, Pittsburgh, Portland, Seattle, and Wilmington, and in the various smaller communities in those states. No reported disciplinary cases or lawsuits have demonstrated any significant problem with the efficacy of screens. There is no record that screening in those states has been unable to protect confidentiality or to prevent the transferring lawyer from participating against the former client. Nor is there any record demonstrating that screens have been ineffective in the context of lawyers moving from government service to private practice. We are firmly convinced that screening can protect essential client interests in the context of private lawyers changing firms. The Ethics 2000 Commission came to the same conclusion.”

Is Vermont’s Rule Just Right or Too Strict?

Again, Vermont’s rule is more strict than the ABA’s.  We allow New Firm’s nonconsensual screening ofLawyer, unless Lawyer participated personally and substantially in  Old Firm’s representation of Husband.

In two posts last week, I asked whether our rule is too strict.  I did not receive many replies.

Two readers replied that Vermont’s rule is not too strict.  One wrote:

  • “The rule is not too strict.  We’ve got to stop making it easier for some lawyers to do things that make all of us look like scoundrels.”

My guess is that this lawyer’s comment  jibes with how  my non-lawyer friends and family members would react if they found themselves in Husband’s shoes upon Lawyer’s transfer to New Firm

An aspiring Vermont lawyer argued the opposite.  The aspiring lawyer wrote:

  • “my comment as to whether or not to adjust Rule 1.10(a)(2) would be to change it to match the ABA Model Rules.  It gives clients more freedom in choosing representation, it allows attorneys more employment opportunities and flexibility, and it allows firms to hire more seasoned attorneys without worrying about an attorney’s “personal or substantial” participation in former matters.”

Similarly, several months ago I heard from a Vermont attorney who was frustrated that our rule prevented a job change.  The attorney wrote:

  • “I understand the necessity to have such a rule, but the current iteration of the rule unfairly limits the movement of attorneys in Vermont. See generally Reporter’s Notes–2012 Amendment, V.R.Proc.C. 1.10 (Without such a procedure, a lawyer wishing to move from one Vermont firm to another may be denied his or her choice simply because of the unamended Rule 1.10)”

The attorney added that a potential new employer was “certainly large enough to put up a ‘wall’ until [the] litigation resolves itself.”

Connecticut does not allow screening.  A few years ago, the Connecticut Bar Association’s Committee on Professional Ethics recommended that the CBA amend its rules and adopt the ABA’s version of the rule.  The recommendation, which appeared in the Stoval Memo, is an excellent primer on the topic.  On page 8, it includes an argument that echoes the sentiment expressed by the frustrated lawyer who contacted me a few months ago:

  • “The Committee notes that amended Rule 1.10 does not permit ‘side-switching’ by an otherwise disqualified attorney. It simply permits other attorneys at his or her new  firm to continue to represent a party adverse to the moving lawyer’s former client.  1.9 would continue to prohibit such a lawyer from participating in a matter adversely to his or her former client, and would still dictate that the moving lawyer preserve former clients’ confidences and information, while still providing a lawyer the freedom to move  from one firm to another without encumbering his or her new firm with imputed conflicts of interest.”

Conclusion

I’m not ready to reach one.  I want to keep this debate going beyond me and 4 others.  What say ye?

  • A.  Leave V.R.Pr.C. 1.10 as is. If Lawyer participated personally & substantially in Old Firm’s representation of Husband, then New Firm can no longer represent Wife.  That’s the price of hiring Lawyer.

 

  • B.  Amend the rule. Trust New Firm to employ an effective screen and trust Lawyer to maintain Husband’s confidences. Prosecute Firm and Lawyer if they do not. Despite Lawyer’s  personal & substantial involvement at Old Firm, an effective screening rule strikes an appropriate balance between protecting Husband and allowing Lawyer the freedom to take another (perhaps, better) job.

Nonlawyers who are reading this, don’t hesitate to weigh in.  How would you feel if your lawyer started working at the firm that represents your adversary?

Irrelevant Post-Script

 

For you hockey fans, my head spun for weeks as I tried to figure out how to apply Rule 1.10 to Montreal’s hiring of Claude Julien within days of Boston’s decision to fire him .  Talk about switching sides. But then I learned that the B’s gave the Habs permission to negotiate with Julien.  Conflict waived.

Bruins