Can a lawyer serve as a party-chosen arbitrator in one uninsured-motorist case while advocating for clients in similar arbitrations against the same insurer?

Plain-English summary

The Committee addressed an attorney who normally acts as an advocate and was asked to serve as one party's arbitrator in an uninsured-motorist dispute between an insurer and its insured, where each side picks an arbitrator and the two select a third. The attorney also represents other parties in similar uninsured-motorist arbitrations and sometimes litigates against the insurer, and some legal issues to be decided as arbitrator may be similar or identical to issues the attorney argues elsewhere as an advocate. The question was whether the attorney could ethically serve, and what responsibilities would apply.

The opinion concluded that, absent evidence of facts suggesting a conflict relating to the specific matter at hand that would prevent the attorney from acting fairly and in good faith as a panel member, the attorney is not ethically barred from serving as arbitrator. The Committee framed the issue as raising concerns in two directions under Rule 1.7. First, an attorney who represents clients before other arbitration panels may not accept arbitrator employment if it would create a conflict of interest with present clients, under the directly-adverse and material-limitation tests of Rule 1.7(a) and (b), with the lawyer obligated under Rule 1.7(c) to act with reasonable diligence in determining whether a conflict exists under Rules 1.7, 1.8, 1.9, and 1.10.

The opinion analyzed the relationship between the arbitrator role and the lawyer's advocacy in similar matters, concluding that the overlap of legal issues did not by itself disqualify the attorney, and that the controlling question was whether a conflict tied to the particular matter would impair the attorney's ability to serve fairly and in good faith. Where no such conflict appears, the attorney may serve.

Currency note

This opinion was issued in 1996, before Alaska's adoption of the 2009 revisions to the Alaska Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Could a lawyer be an arbitrator in one case and an advocate in similar cases?

A: The opinion concluded the lawyer may, absent facts showing a conflict relating to the specific matter that would prevent the lawyer from acting fairly and in good faith on the panel.

Q: Did handling the same legal issues as an advocate disqualify the lawyer?

A: Per the opinion, the overlap of similar or identical legal issues did not by itself bar the lawyer; the focus was on a conflict tied to the particular matter being arbitrated.

Q: What must the lawyer do before accepting an arbitrator role?

A: The opinion noted Rule 1.7(c) requires the lawyer to act with reasonable diligence in determining whether a conflict of interest exists under Rules 1.7, 1.8, 1.9, and 1.10 with present clients.

Background and rules framework

The opinion interpreted Alaska Rule of Professional Conduct 1.7 (conflicts of interest; Model Rule 1.7), including the diligence obligation in Rule 1.7(c) to check for conflicts under Rules 1.8, 1.9, and 1.10, as applied to a lawyer serving as a party-designated arbitrator. The analysis sits alongside Model Rule 1.12 principles on a lawyer's service as a third-party neutral.

Citations and references

Rules of Professional Conduct:

• Alaska RPC 1.7 (conflicts of interest), including the diligence duty in Rule 1.7(c)
• Alaska RPC 1.9, 1.10 (former-client and imputed conflicts, referenced in the diligence check)

See also

• CA Op. 1984-80: Lawyer as Party-Designated Arbitrator
• NY State Bar Op. 448: Lawyer as Nonneutral Arbitrator
• FL Bar Ethics Op. 87-10: Lawyer as Non-Neutral Arbiter

Source

• Landing page: https://alaskabar.org/ethics-discipline/ethics-opinions/adopted-ethics-opinions-chronological/
• Original PDF: https://alaskabar.org/wp-content/uploads/96-6.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

ALASKA BAR ASSOCIATION
ETHICS OPINION NO. 96-6
Ethical Considerations When Acting
As An Arbitrator In One Proceeding
And As An Advocate In Another Proceeding
The Committee has been asked to resolve ethical questions which may
arise when an attorney who normally acts as an advocate on behalf of clients is
asked also to serve as an arbitrator. In the factual situation presented to the
Committee, the arbitration involves a dispute between an insurance company
and its insured. Pursuant to the uninsured motorist provisions of the
insurance policy each side chooses an arbitrator. The two arbitrators thus
chosen will choose a third arbitrator to complete the panel. The attorney in
question has been asked to serve as one party's arbitrator.
The attorney represents other parties in similar uninsured motorist
arbitrations and sometimes litigates against the insurance company. Some of
the legal issues to be decided by the attorney as arbitrator may be similar or
identical to issues for which the attorney is acting as advocate before other
arbitration panels. The question asked of the Committee is whether the
attorney can ethically serve as an arbitrator under these circumstances. If so,
what are the attorney/arbitrator's ethical responsibilities in this situation? The
Committee concludes that, absent evidence of facts which suggest that the
attorney has a conflict relating to the specific matter at hand, and is therefore
unable to act fairly and in good faith as a member of the arbitration panel, the
attorney is not ethically barred from acting as arbitrator.
This question raises issues in two directions. First, an attorney who
represents clients before other arbitration panels may not accept employment
as an arbitrator if the employment would result in a conflict of interest with his
present clients. Rule 1.7 of the
Alaska Rules of Professional Conduct states as follows:
CONFLICT OF INTEREST: GENERAL RULE
(a)
A lawyer shall not represent a client if the
representation of that client will be directly adverse to
another client in the same or a substantially related
matter, unless:

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(1) the lawyer reasonably believes the
representation will not adversely affect the relationship
with the other client; and
(2) each client consults after consultation.
(b)
A lawyer shall not represent a client if the
representation of that client may be materially limited
by the lawyer's responsibilities to another client or to a
third person, or by the lawyers' own interests, unless:
(1) the lawyer reasonably believes the
representation will not be adversely affected; and
(2) the client consents after consultation.
When representation of multiple clients in a single
matter is undertaken, a consultation shall include
explanation of the implications of the common
representation and the advantages and risks involved.
(c)
A lawyer shall act with reasonable diligence in
determining whether a conflict of interest, as described
in paragraphs (a) and (b) of this rule, or Rules 1.8, 1.9
and 1.10 exists.
There is nothing inherent in the situation of the attorney acting as
arbitrator that creates an insurmountable conflict. The attorney's service as
arbitrator would not require the attorney to modify or change positions being
advanced on behalf of other clients in other arbitrations or other forums. The
attorney acting as arbitrator cannot render a decision in one arbitration which
would have a binding, precedential affect on another panel or a different forum.
Similarly, the attorney arbitrator is free to make decisions in the context of the
arbitration without fear that these decisions will adversely impact other
clients' interests.1
1 This opinion deals only with the question whether the situation raised inherently creates a

conflict. Specific facts might change the situation. For example: a different issue might exist
if the attorney acting as arbitrator was sitting on a panel which included persons who are also
arbitrators in cases in which the attorney acts as an advocate. Under those circumstances,
the possibility of improper conflict is more direct. An arbitrator who does work for an insurance
company may face a direct financial conflict because of a perception that the ability to obtain
future insurance related work may depend on whether the arbitrator rules favorably to the
insurance company's interest in a particular arbitration proceeding. See Donegal Ins. Co. v.
Longo, 610 A.2d 466,468 (Pa. Super. 1992) (Undisclosed representation of insurance company

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The situation ethically is similar to the situation in which the attorney
represents different clients and argues conflicting rules of law before different
tribunals. Although the attorney must be careful to avoid conflict, there is
nothing inherently improper about the situation. See ALASKA RULES OF
PROFESSIONAL CONDUCT Rule 1.7 and commentary (a lawyer may represent
parties having antagonistic positions on a legal question that has arisen in
different cases, unless representation of either client would be adversely
affected).; ABA Formal Opinion 93-377 (October, 1993) (if lawyer reasonably
believes representation will not have a significant impact on resolution of issue
in second case and will not cause lawyer to "soft pedal" representation of one
client in favor of another, dual representation is permitted upon full disclosure
and with both clients' permission.)
The other ethical question that must be resolved is the
attorney/arbitrator's ethical responsibilities as a member of the arbitration
panel.
As an arbitrator, an attorney has an obligation to act fairly and to avoid
either impropriety or the appearance of impropriety in reaching conclusions.
In City of Fairbanks Municipal Utility System v. Lees, 705 P.2d 457, 463
(Alaska 1985), the Alaska Supreme Court noted that arbitrators should "avoid
the appearance of impropriety by following the American Arbitration
Association Guidelines, which call for disclosure of any contacts or
associations with either party." However, the obligation to avoid impropriety
is not the same as an obligation to hold no opinion in the general subject
matter area of the arbitration. Indeed, one of the advantages of arbitration is
that arbitrators presumably will be drawn from those who have some expertise
and knowledge in the area:
As arbitrators are usually knowledgeable individuals in
a given field, often they have interests and
relationships that overlap with the matter they are
considering as arbitrators. The mere appearance of
bias that might disqualify a judge will not disqualify an
arbitrator.
Florasynth v. Pickholz, 750 F.2d 171, 173-74 (2nd Cir. 1984). See
Commonwealth Coatings Comp. v. Continental Casualty Co., 393 U.S. 145, 89
S.Ct. 337, 21 L.Ed. 2d 301 (1969) (White, J., concurring) (Arbitrators are not
by attorney/arbitrator of insurance company made arbitration proceeding basically unfair and
biased.)

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held to standard of judges; it is often because they are men of affairs that they
are effective adjudicators.) This consideration is even stronger in
circumstances such as those presented to the committee, in which each side is
directed to appoint an arbitrator and a third arbitrator is chosen by the first
two. Although all the arbitrators must avoid impropriety and direct bias, there
is no ethical requirement that the arbitrators chosen by one or the other of the
parties to the dispute be complete strangers to the legal issues involved.
Indeed, in many situations the expectation is to the contrary. Courts which
have been asked to resolve the issue presented to the Committee today have
recognized the practical realities of this situation. In Society for Good Will to
Retarded Children v. Carey. 466 F.Supp. 722 (E.D.N.Y. 1979), for example, the
court declined to disqualify an attorney representing mentally retarded clients
in litigation before the court. The alleged "conflict" was that the attorney had
also been appointed by the court to serve on a review panel responsible for
implementing a consent decree for similarly situated clients at a different
institution. In denying the motion for disqualification the court held that no
ethical impropriety had occurred and took judicial notice that arbitrators may
properly serve even if they have previously expressed opinions or represented
clients in related matters.
The closest analogy to Mr. Schnep's role in the
Willowbrook case is that of an adversary representative
on a tri-partite arbitration panel. No one expects
neutrality from such a person. No one imagines that a
lawyer in that position will refrain from representing
similar clients in other litigations. It is a matter of
common professional knowledge that lawyers
associated with employers or union members, for
example, sit on such panels and then litigate against
each others clients. Fed. R. Ev. Rule 201.
In "tri-partite arbitration ... each party's arbitrator 'is
not individually expected to be neutral.'" Matter of
Astoria Medical Group (Health Ins.), 11 N.Y. 2d 128,
134, 227 N.Y.2d 401, 405, 182 N.E.2d 85, 87 (1962)
(Fuld, J.). Cf., e.g., 9 U.S.C. § 10(b); N.Y. CPLR §
7511(b)(1)(ii). All that is required is that the
arbitrator's possible bias through connections with the
appointing authority be revealed.
466 F.Supp, supra, at 728.

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This is not to suggest that an arbitrator selected by one or the other
party to the arbitration has no ethical obligations. To the contrary,
The fact that party selected arbitrators are not
expected to be 'neutral', however, does not mean that
such arbitrators are excused from their ethical duties
and the obligation to participate in the arbitration
process in a fair, honest and good faith manner. The
New York Court of Appeals expanded on the ethical
obligations of party-appointed arbitrators stating:
Partisan he may be, but not dishonest. Like all
arbitrators, the arbitrator selected by a party
must (unless the requirement is waived) take the
prescribed oath that he will "faithfully and fairly
... hear and examine the matters in controversy
and ... make a just award according to the best
of [his] understanding." And, if either one of the
party-appointed arbitrators fails to act in
accordance with such oath, the award may be
attacked on the ground that it is the product of
"evident partiality or corruption." Such an
attack, however, must be based on something
overt, some misconduct on the part of an
arbitrator, and not simply on his interest in the
subject matter of the controversy or his
relationship to the party who selected him.
Metropolitan Property and Casualty v. J.C. Penney Casualty, 780 F.Supp. 885,
892 (D.Conn. 1991), quoting Astoria Medical Group v. Health Insurance Plan of
Greater New York, 11 N.Y.2d 128, 227 N.Y.S. 2nd 401, 407; 182 N.E.2d 85, 89
(N.Y. Court of Appeals 1962) (citations and italics omitted).
This distinction is recognized even in the Alaska Rules of Professional
Conduct. Rule 1.12 prohibits a former judge or arbitrator from representing
anyone in connection "with a matter in which the lawyer participated
personally and substantially as a judge or other adjudicative officer, arbitrator
or law clerk... ." A specific exception exists, however, in that "an arbitrator
selected as a partisan of a party in a multi-member arbitration panel is not
prohibited from subsequently representing that party." A.R.P.C. 1.12 (d).

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In summary, an attorney acting as arbitrator must be willing and able to
hear the evidence presented and to make decisions based on that evidence free
of specific bias or prejudice toward the parties or the facts. An arbitrator who
is aware of circumstances or relationships which raise questions about the
ability to be fair and impartial should notify the parties. If the arbitrator in
good faith believes that he or she cannot meet the standard of fairness required
of all members of an arbitration panel, the arbitrator should refuse to serve.
An arbitrator is not automatically disqualified from serving merely because the
arbitrator has knowledge, experience or opinions in the relevant field, and
specifically, is not automatically disqualified because he or she represents
clients in similar but unrelated matters.
CONCLUSION
For these reasons, and given the facts outlined to the Committee there is
nothing inherently unethical about an attorney serving as an arbitrator under
the circumstances outlined.2
Approved by the Alaska Bar Association Ethics Committee on September 5, 1996.
Adopted by the Board of Governors on October 18, 1996.

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The Committee takes no stand as to whether an arbitrator under the circumstances
outlined in this opinion qualifies as an "impartial" or "neutral" arbitrator under the provisions
of an insurance contract. That issue raises matters of contract interpretation and law which
are appropriately addressed elsewhere.
2

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