Can a lawyer serve both as a member of a nonprofit's board of trustees and as the paid attorney for that same board?

Plain-English summary

A lawyer served as an elected member of the board of trustees of a nonprofit religious corporation and from time to time provided legal assistance and opinions to the board, previously as donated services. The board proposed paying the lawyer a retainer, and the question was whether the lawyer could properly serve as both a trustee and the board's attorney.

The opinion notes that Rules 6.3 and 6.4 encourage lawyers to serve as directors, officers, or members of legal services organizations and organizations involved in law reform, and observes that nonprofit boards benefit from the services of competent lawyers. It quotes Justice James L. Robertson's law journal article on the lawyer's obligation to render public service and to take leadership roles in charitable, civic, and religious organizations. It also cites Kentucky Bar Opinion E-60, which found no per se prohibition against a lawyer serving as a trustee of an institution his firm represents, distinguishing lawyers from CPAs because a CPA's auditing role requires independence from the client while a lawyer owes undivided loyalty.

The opinion concludes that the legal profession's obligation to render public service supports a lawyer serving as a director or board member of a nonprofit and as its attorney without any conflict of interest per se. It adds that Rules 1.13 and 1.7 provide further guidance should conflicts arise during the dual service.

In practice

Under this opinion, holding both a board seat and the counsel role for the same nonprofit is not a per se conflict; a lawyer may do both. The opinion frames the dual role through the public-service rules (6.3 and 6.4) and signals that if a specific conflict develops, the entity-client rule (1.13) and the general conflict rule (1.7) govern. The opinion's no-per-se-conflict conclusion does not foreclose a conflict on particular facts.

Common questions

Q: Can a lawyer sit on a nonprofit's board and also be its lawyer?

A: Per this opinion, yes; the Committee found no conflict of interest per se in serving as both a board member and the organization's attorney.

Q: Does it matter that the lawyer is now paid a retainer rather than donating services?

A: The opinion was rendered in response to that proposed change and still concluded there is no per se conflict in the dual role.

Q: What if a conflict does come up while the lawyer serves in both roles?

A: The opinion states Rules 1.13 and 1.7 provide further guidance should conflicts arise in the course of the dual service.

Q: Why are lawyers treated differently from accountants here?

A: The opinion cites Kentucky's reasoning that an auditor must be independent of and even skeptical toward the client, while a lawyer owes undivided loyalty, so the dual role is acceptable for a lawyer.

Background and rules framework

The opinion applies Mississippi Rules of Professional Conduct 6.3 and 6.4 (membership in legal services and law-reform organizations, the analogs of Model Rules 6.3 and 6.4) to support a lawyer's service on a nonprofit board, and points to Rule 1.13 (organization as client, Model Rule 1.13) and Rule 1.7 (concurrent conflicts, Model Rule 1.7) as the rules that govern any conflict arising from the dual role.

Citations and references

Rules of Professional Conduct:

• Model Rule 6.3 / Mississippi Rule 6.3: membership in a legal services organization.
• Model Rule 6.4 / Mississippi Rule 6.4: law reform activities affecting client interests.
• Model Rule 1.13 / Mississippi Rule 1.13: organization as client.
• Model Rule 1.7 / Mississippi Rule 1.7: concurrent conflicts of interest.

Other opinions cited:

• Kentucky Bar Association Ethics Opinion E-60 (July 1972): no per se prohibition against a lawyer serving as a trustee of an institution his firm represents.

Other authorities cited:

• James L. Robertson, "The Lawyer as Hero," 53 Mississippi Law Journal 431, 442 (Sept. 1983).

See also

• MS Bar Ethics Op. 169: Firm Associate Serving on a City Civil Service Commission
• MS Bar Ethics Op. 165: Board Attorney Signing a Bidder's Pre-Written Opinion
• MS Bar Ethics Op. 126: Firm Representing Both a County Board and a City

Source

• Landing page: https://www.msbar.org/ethics-discipline/ethics-opinions/formal-opinions/99/
• Original PDF: https://www.msbar.org/media/1104/et_op_99-amended.pdf

Original opinion text

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

ETHICS OPINION NO. 99

OF THE MISSISSIPPI BAR

RENDERED October 05, 1984

AMENDED April 06, 2013

CONFLICT OF INTEREST - ENTITY AS A CLIENT - An attorney may serve as a member of the Board of Trustees of a non-profit religious corporation and as Attorney for the Board.

The Ethics Committee of The Mississippi Bar has been requested to render an opinion on the following facts:

An Attorney serves as an elected member of the Board of Trustees of a non-profit religious corporation and from time to time is called upon to render legal assistance and offer legal opinions, which services in the past have been considered and received by the Attorney as donated services to the Board. It has now been proposed that the Attorney receive a retainer fee for services rendered, and the question is posed as to the propriety of the Attorney's serving as both a member of the Board of Trustees and as Attorney for the Board.

Rules 6.3 and 6.4 of the Mississippi Rules of Professional Conduct (MRPC) urge lawyers to serve as directors, officers, or members of legal services organizations and organizations involved in reform of the law or its administration. The Committee certainly feels that decision-making Boards of Trustees of non-profit corporations could require the services of lawyers with integrity and competence.

Justice James L. Robertson of the Mississippi Supreme Court has recently reminded the Bar that members of the legal profession have a responsibility and obligation to serve the public:

Accepting of the title "lawyer" carries with it a substantial obligation to render public service. Opportunity to play a leadership role in one's community, state, and nation regularly devolve upon the lawyer . . . Leadership roles in charity, civic, religious, and other non- profit organizations are very much in need of the ability and services most lawyers have to offer. Robertson, "The Lawyer as Hero," 53 Mississippi Law Journal 431 at 442 (September, 1983).

The Committee further notes that Ethics Opinion E-60 of the Kentucky Bar Association, rendered in July 1972, states that when a lawyer's firm represents the Board of Trustees of a College, there is no prohibition per se against the lawyer's accepting an appointment as a Trustee of the College, though individual situations could conceivably arise creating a conflict of interest or impropriety. The Kentucky Opinion stated in part:

This question arose because a member of an auditing firm was in a similar fact situation and felt compelled to resign. There is no parallel between attorneys and CPA's in these situations in that the respective fields involve different duties and obligations with regard to clients. Lawyers have a responsibility demanding undivided loyalty and fidelity to their clients. CPA's have no such fiduciary obligation. Indeed, an auditor is frequently required by the very nature of his duties to be at "opposite poles" from his employer, and to view the employer's fiscal activities with a certain amount of aloofness, possibly even suspicion. Thus, since the respective natures of the service rendered can and must be distinguished, this distinction is the basis for finding no conflict of interest per se for an attorney's serving on a college board of trustees.

The Committee is of the opinion that the obligation of the legal profession to render public service and legal counsel where needed, suffices to indicate that a lawyer may serve as a director or board member of a non-profit organization and as the attorney for such organization without any conflict of interest per se.

Rules 1.13 and 1.7, MRPC, provide further guidance should conflicts arise in the course of the attorney's service on the board and his simultaneous legal representation of the board.