Is there a conflict of interest when a Maine lawyer represents an opposing lawyer as a client in an unrelated matter?

Plain-English summary

The Commission addresses conflicts that arise when a lawyer (or firm) represents another lawyer as a client while that lawyer-client is opposing the firm's other client in an unrelated matter, a recurring situation given the small size of Maine's litigation bar. The opinion notes the Maine Rules anticipated but did not resolve the question: a comment to Rule 1.7 that would have addressed it was deleted before adoption, so the analysis proceeds under Rule 1.7 itself.

The opinion analyzes whether a concurrent conflict exists under either prong of Rule 1.7(a). The first prong (direct adversity) is the less likely: the mere fact that two lawyers oppose each other in representing third-party clients does not make the lawyers "directly adverse" to the opposing clients, though direct adversity could arise, for example, in a legal malpractice claim. The more common concern is the second prong, Rule 1.7(a)(2): a significant risk that the representation of one client would be materially limited by the lawyer's responsibilities to another client or by a personal interest. Whether that risk exists depends on the lawyer's honest, good-faith evaluation of factors drawn from ABA Formal Op. 97-406, including the importance of the matter to the lawyer-client, the size of the expected fee, the importance and sensitivity of the third-party matters, the similarity of the two representations, and the nature of the relationships involved.

If the lawyer concludes a concurrent conflict exists, representation may continue or begin only if the lawyer reasonably believes competent and diligent representation can be provided to each affected client and each gives informed consent confirmed in writing (Rule 1.7(b)). The opinion notes the consent requirement arises only after the lawyer finds a significant risk of material limitation, and that a client may decline to bear that risk despite the lawyer's confidence. It observes a consent to future conflicts may be a prudent tool. When a conflict exists, Rule 1.10 imputes it to the firm, though a client may be more willing to accept the risk if a different lawyer in the firm handles the matter. The bottom line: an attorney-client relationship between adversary attorneys does not automatically create a conflict; a fact-specific Rule 1.7 analysis is required.

In practice

Under the Maine rules as the opinion read them in 2011, a lawyer who represents an opposing lawyer as a client in an unrelated matter must run a fact-specific Rule 1.7 analysis rather than assume a conflict exists or does not. The opinion holds that the mere fact two lawyers are adverse in representing third-party clients does not make them directly adverse for conflict purposes, and that the usual concern is whether there is a significant risk under Rule 1.7(a)(2) that one representation would be materially limited by the lawyer's responsibilities to, or interest in, the lawyer-client. If the lawyer finds such a conflict, the opinion holds representation may proceed only with a reasonable belief of competent and diligent service to each client and each client's informed written consent, and that Rule 1.10 then imputes the conflict to the firm. The opinion notes a consent to future conflicts may be a prudent tool to consider at the outset.

Common questions

Q: Is it automatically a conflict to represent a lawyer who is opposing your other client in a separate case?

A: No. The opinion concludes that an attorney-client relationship between adversary attorneys does not automatically create a concurrent conflict; a careful Rule 1.7 analysis of the specific facts is required.

Q: Are the two lawyers "directly adverse" just because they oppose each other?

A: Generally no. The opinion states the mere fact that attorneys oppose each other in representing third-party clients does not make them directly adverse, although direct adversity could arise, for example, in a malpractice claim between them.

Q: What test applies most often?

A: Rule 1.7(a)(2): whether there is a significant risk that one representation would be materially limited by the lawyer's responsibilities to another client or a personal interest, judged by factors such as the importance of the matter to the lawyer-client, the fee, and the sensitivity and similarity of the matters.

Q: If a conflict exists, can the lawyer still proceed?

A: Only if the lawyer reasonably believes competent and diligent representation can be given to each affected client and each gives informed consent confirmed in writing (Rule 1.7(b)). The opinion notes the conflict is then imputed to the firm under Rule 1.10.

Background and rules framework

The opinion interprets Maine Rule of Professional Conduct 1.7 (conflicts of interest; current clients) and Rule 1.10 (imputation), corresponding to the ABA Model Rules. It notes that a comment to Rule 1.7 addressing this scenario was deleted before Maine adopted the Rules, and relies on ABA Formal Op. 97-406 and the Restatement (Third) of the Law Governing Lawyers for the factors.

Citations and references

Rules of Professional Conduct:

• Model Rules 1.7, 1.10
• Maine R. Prof. Conduct 1.7, 1.10

Cases:

• Board of Overseers of the Bar v. J. Michael Conley, Grievance Comm'n File No. 99-70 (June 5, 2001).

Other opinions cited:

• ABA Formal Op. 97-406: conflicts arising when lawyers represent their adversaries.
• New York City Bar Ass'n Formal Op. 1996-3; Restatement (Third) of the Law Governing Lawyers § 125.

See also

• ABA Formal Op. 97-406: Representing an Opposing Lawyer, Conflicts
• ABA Formal Op. 494: Friendships With Opposing Counsel

Source

• Landing page: https://mebaroverseers.org/attorney_services/opinion.html?id=318185

Original opinion text

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

Issued by the Professional Ethics Commission

Date Issued: November 3, 2011

We have been asked to address conflicts of interest issues arising when an attorney represents opposing counsel in an unrelated matter.

The question has been brought to us by a firm whose practice includes representation of attorneys in a variety of legal matters and proceedings. Given the relatively small size of the litigation bar in this state it is understandably not uncommon for this firm to find that an opposing side is represented by one of its clients. The question raised is whether a conflict of interest exists for the representing law firm and what its ethical obligations are to its lawyer-client and to its third party client.1

The issue raised by this inquiry has been the subject of ethical opinions, commentary and disciplinary proceedings throughout the country. See generally, ABA Formal Op. 97-406; New York City Bar Association Formal Opinion 1996-3; Crane, When Lawyers represent their Adversaries: Conflicts of Interest Arising Out of the Lawyer-Lawyer Relationship, 23 Hofstra L. Rev. 791 (1995); Restatement (Third), The Law Governing Lawyers, §125, Reporter?s Note to Comment d. Maine?s adoption of the Maine Rules of Professional Conduct (MRPC) anticipated, but did not answer, the question being considered here. The Reporter?s Notes indicate that:

The Task Force discussed the question of whether a lawyer?s representation of a client who is a lawyer presented a conflict of interest when that client/lawyer is concurrently representing a party adverse to another client of the lawyer. The Task Force recognized that this situation may or may not present a classic conflict of interest. Notwithstanding the finding of a conflict of interest, the Task Force recommended that in appropriate cases, the lawyers should disclose the relationships and representation to all affected parties at the outset of the respective engagements. See Comment [10] to M. R. Prof. Conduct 1.7.

The referenced sentence in Comment [10] ("Likewise, when a lawyer represents a client who is a lawyer, and is concurrently representing another client in a matter in which the client/lawyer is representing an adverse party, the lawyer?s representation of either client may be limited."), however, was deleted from the final and adopted version of the MRPC. Therefore, the MRPC does not have any provision that directly addresses this issue.

This Commission?s analysis of the question begins with Rule 1.7 regarding conflict of interests and a determination of whether a concurrent conflict of interests exists. Such would exist in one of two situations. In the less likely situation, the attorney would be representing two clients, one of whom was an attorney, where the clients are ?directly adverse? to one another, regardless of whether the representation is in the same matter or substantially related matters. The mere fact that attorneys are opposed to each other in their representation of third party clients does not make the attorneys ?directly adverse? to the opposing clients in the sense intended for purposes of this conflict analysis. Situations may nonetheless arise where a lawyer?s client may be directly adverse to opposing counsel in another matter, such as a legal malpractice claim. In those circumstances, this first prong of the concurrent representation analysis would be implicated.

More commonly, the concurrent conflict rule would be implicated by the second prong of Rule 1.7(a), by an occasion in which

(2) there is significant risk that the representation of one or more clients would be materially limited by the lawyer?s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.

The existence of a conflict of interests here would depend upon the representing attorney?s honest and good faith evaluation of many factors which would lead to determining the risk of a limitation of that attorney?s ability to represent either client effectively.2 These factors may include

• The relative importance of the matter to the represented lawyer

• The relative size of the fee expected by the representing lawyer

• The relative importance to each lawyer and to each lawyer?s client of the matter involving the third party clients

• The sensitivity of each matter

• The substantial similarity between the subject matter or issues of the two representations and

• The nature of the relationship of one lawyer to the other and of each lawyer to his third party client. See ABA Formal Op. 97-406.

These listed factors are not meant to be exhaustive, but give a direction as to the inquiry required to fulfill the rule.

If, after performing this analysis, the representing attorney concludes that a concurrent conflict of interest exists as to either client, representation may continue or be commenced only if

(1) The lawyer reasonably believes that the lawyer would be able to provide competent and diligent representation to each affected client; and

(2) Each affected client gives informed consent, confirmed in writing.

M. R. Prof. Conduct 1.7(b)(1) and (2).

Under the first subsection, the representing lawyer would have to conclude that, in spite of the significant risk that that lawyer?s representation would be limited, the lawyer reasonably believes that diligent and competent services would be provided to each client. If that hurdle can be passed in the lawyer?s own analysis, then the rule next requires that the clients? informed consents to representation be obtained.3

It may be argued that this gives too much control to the client over the attorney?s relationships. It needs to be recalled, however, that the client?s consent is only required after the lawyer has determined that there is a significant risk that the representation would be materially limited by one or more other interests or responsibilities. This is a risk which the client may not be willing to bear in spite of the lawyer?s personal belief that the quality of the representation will not suffer. To the extent the representing lawyer may have a concern that the represented lawyer may use the consent issue to affect the third party litigation, this underscores the caution which should be used by each attorney in entering into the attorney-client relationship in the first place. Prudent practice may cause each attorney to explore whether a consent to future conflict, , is an appropriate tool in their respective situation. See Comment [22].

If the representing attorney concludes that a concurrent conflict of interests exists as to either client, then the rule relating to imputed conflict, Rule 1.10, comes into play and the other attorneys in the firm are likewise subject to the conflict. As a practical matter, a client may be more willing to undertake the risk of material limitation if a partner or associate of the lawyer with the personal conflict undertakes the representation.
The existence of an attorney-client relationship between adversary attorneys, therefore, does not automatically cause a concurrent conflict of interest to exist. A careful analysis of Rule 1.7 needs to be undertaken concerning the specific facts of each case to determine the representing attorney?s responsibilities.

Footnotes

1 We have not been asked to address, nor do we here, the issues relating to the ethical responsibilities of the represented lawyer and that lawyer?s firm to that lawyer?s client.

2 This is a different standard from the prior Code of Professional Responsibility.. See Board of Overseers of the Bar v. J. Michael Conley, Grievance Comm?n File No. 99-70 (Report of Findings, June 5, 2001) finding a violation of Maine Bar Rule 3.4(a)(now abrogated) requiring disclosure of an interest or relationship ?that might reasonably give rise to a conflict of interest under these rules? where the Respondent attorney represented the bar complainant in a medical malpractice case but did not disclose to her that he was represented by the opposing attorney?s firm in an unrelated matter. Under the current rules, this disclosure would not be mandated unless the risk rose to the level defined in M. R. Prof. Conduct 1.7(a)(2).

3 We note that, even if no conflict exists and therefore no consent is required, the attorneys may as a matter of prudent practice want to advise their third-party clients, within the confines of the rules relating to confidentiality, of the existence of the concurrent representation. This may avoid future embarrassment or disputes between lawyers and lay clients.