Can a lawyer who examines titles for a Federal Land Bank also represent the loan applicant in a quiet-title suit and then pass on the title for the bank?

Plain-English summary

Attorney A was a local attorney for a Federal Land Bank, examining abstracts of title on which loans were contemplated. The question was whether A, after requiring a title to be quieted, could represent the loan applicant in court to quiet the title, so that he would be representing both the applicant and the Federal Land Bank.

The Board concluded A would be representing conflicting interests by quieting title for the applicant and then passing on the title for the bank. It quoted Rule 8, that it is unprofessional to represent conflicting interests except by express consent after full disclosure. The Board explained that Rule 8 relaxes the general agency principle against serving two masters only when the lawyer brings himself within the strict requirement of the free and intelligent consent of all parties after full knowledge of the facts. It found this inquiry different from the ordinary case because it involved a member of the bar, a citizen, and a governmental agency that acts only through delegated powers; when the lawyer accepts an attorneyship to examine titles for the agency he becomes part of it for those duties, and dealing with the citizen in that capacity places him in a delicate and dangerous position, where he could make needless title requirements, indirectly solicit business, or steer legal business to favored channels for his own benefit. The Board concluded that, while technically permissible under Rule 8 if its strict letter is followed, such employment should be accepted only in exceptional cases where the applicant is absolutely unwilling to secure other counsel after being advised by A to do so.

Currency note

This opinion was issued in 1933, decades before Oklahoma replaced its original Rules of Professional Conduct (patterned on the ABA Canons of Professional Ethics) with the Oklahoma Rules of Professional Conduct (adopted 1988) and the later Ethics 2000 revisions. Concurrent conflicts of interest and informed consent are governed today by separate provisions of the current Oklahoma Rules of Professional Conduct. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific principle mentioned here.

Common questions

Q: Was representing both the bank and the applicant a conflict of interest?

A: Yes. The Board concluded the lawyer would be representing conflicting interests by quieting title for the applicant and then passing on the title for the bank.

Q: Was the dual representation flatly prohibited?

A: No. The Board said it was technically permissible under Rule 8 if the strict consent-after-full-disclosure requirement was met, but should be undertaken only in rare cases.

Q: When did the Board say the lawyer could take the applicant's case?

A: Only in exceptional cases where the applicant was absolutely unwilling to secure other counsel after the lawyer advised him to do so.

Background and rules framework

The opinion applied Rule 8 of the then-current Oklahoma Rules of Professional Conduct, patterned on the ABA Canons of Professional Ethics, which permitted representing conflicting interests by express consent after full disclosure. The Board treated the lawyer's role as part of the governmental lending agency as heightening the danger of the dual relationship and counseled against it except in narrow circumstances.

Citations and references

Rules of Professional Conduct:

• Rule 8 (1929 Oklahoma Rules of Professional Conduct): it is unprofessional to represent conflicting interests except by express consent of all concerned after full disclosure.

See also

• Okla. Bar Ethics Op. 44: Representing Two Sets of Heirs With Conflicting Claims
• Okla. Bar Ethics Op. 62: Representing Taxpayers in a Bond Test Suit the City Funds
• Okla. Bar Ethics Op. 28: Representing Both a Bankrupt and Creditors

Source

• Landing page: https://www.okbar.org/ethics/ethics-opinion-no-65/

Original opinion text

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

Adopted December 27, 1933

The Board of Governors is in receipt of the following request for an advisory opinion:

"'A', an attorney, is a local attorney for a Federal Land Bank and as attorney examines abstracts of title on which loans are contemplated. Question: Is it proper for 'A', after requiring title to be quieted, to represent the applicant in court to quiet the title, assuming the attitude of representing both applicant and Federal Land Bank?"

In response:

In the opinion of the Board 'A', under the circumstances, would be representing conflicting interests were he to quiet the title for the applicant, and then proceed to pass upon the title for the Federal Land Bank. However, Rule Eight of the Rules of Professional Conduct provides:

"It is unprofessional to represent conflicting interests, except by express consent of all concerned given after a full disclosure of the facts."

The inhibition against an attorney representing conflicting interests grows out of the principle of agency. "No man can serve two masters." The ground upon which this rule is based rests upon the fraudulent advantage which such an interest may stimulate the agent to take to the prejudice of his principle's rights. However, Rule Eight, supra, was enacted to relax the general principle of law in order that an attorney might properly represent conflicting interests when he brings himself clearly within the strict interpretation of the rule which requires the free and intelligent consent of all parties concerned, given after full knowledge of all the facts and circumstances. In the ordinary transactions where the attorney brings himself within the strict letter of the rule there is no just ground for criticism. However, the present inquiry presents a slightly different situation than the ordinary. Here we are confronted with a situation involving a member of the Bar, a citizen and a governmental agency which of necessity acts only by and through a delegation of powers. Upon the acceptance of an attorneyship to examine titles for this governmental agency the attorney becomes a part of the agency for the purpose of performing those special duties. In this representative capacity the member of the Bar in dealing with the citizen places himself in a very delicate situation and one fraught with many dangers. It places the member of the Bar in a position where he can make needless title requirements, indirectly solicit business, direct legal business into favored or chosen channels and commit other malfeasances to his pecuniary benefit. To occupy this dual relationship will in some, and in many instances create a condition which will tend to bring reproach upon the legal profession. Such delicate situations should always be avoided where possible. A member of the Bar should not only avoid all impropriety but should likewise avoid the appearance of impropriety. The Bar as a whole would, undoubtedly, frown upon the situation presented should 'A' accept employment from the applicant.

The Board is of the opinion that while technically such employment of 'A' by the applicant is permissible under Rule Eight supra, provided the strict letter of the Rule is followed, yet the relationship creates such a delicate situation surrounded by so many pitfalls and so likely to bring reproach upon 'A' and the legal profession, that such employment should be accepted only in those exceptional cases where the applicant is absolutely unwilling to secure the services of other counsel after being advised so to do by 'A'.