What conflicts arise when a lawyer sells title insurance as the insurer's agent in a transaction involving a legal client?
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This page answers the general question as of 1993. Ask about yours and see what the current North Dakota Rules of Professional Conduct say for your facts, with citations.
Plain-English summary
The committee considered a lawyer acting as a title company's agent and issuing insurance policies in a transaction involving a lawyer client as seller, buyer, mortgagor, or mortgagee. The opinion identified possible competing interests among the buyer, seller, and insurer. It also identified a possible personal-interest conflict when the lawyer advised a buyer about insurance while expecting part of the commission.
Under Rule 1.7(c), the committee said the lawyer might resolve some conflicts by reasonably believing the representation would not be adversely affected and obtaining client consent after consultation about the common representation's implications, advantages, and risks. It discussed Rule 1.8(a)'s requirements for a business transaction with a client, including fairness, consultation, advice to seek independent counsel, and consent.
The committee's conclusion remained qualified: it said these rules might resolve conflicts, but the competing property rights of a seller client, insurer, and buyer client could put the lawyer in violation of the conduct rules. It expressly did not address the lawyer's possible legal liability.
Currency note
This opinion was issued in 1993, before North Dakota's 2006 revisions to its Rules of Professional Conduct. The later North Dakota Opinion 06-05 states: “On August 1, 2006, material changes to N.D.R. Prof. Conduct 1.10(a) will take effect.” 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 Treat this page as historical context, not current guidance.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.
Common questions
Q: Did the committee give unconditional approval to the lawyer's insurer-agent role?
A: No. It expressed concern that conflicting property interests could place the lawyer in violation of the conduct rules.
Q: What conditions did the committee discuss for potentially resolving conflicts?
A: It discussed a reasonable belief that representation would not be adversely affected and client consent after consultation under Rule 1.7(c), together with Rule 1.8(a)'s requirements for a transaction with a client.
Background and rules framework
The opinion discusses North Dakota Rules 1.7(b), 1.7(c), and 1.8(a) and cites Estate of Schuldt, 428 N.W.2d 251 (S.D. 1988), as conflict guidance.
Citations and references
Rules of Professional Conduct:
- North Dakota Rules 1.7(b), 1.7(c), and 1.8(a).
Cases:
- Estate of Schuldt, 428 N.W.2d 251 (S.D. 1988).
See also
Source
- Landing page: https://www.sband.org/page/ethics_opinions
- Original PDF: https://web.archive.org/web/20250000000000id_/https://www.sband.org/resource/resmgr/docs/for_lawyers/93-08.pdf
Original opinion text
Full opinion text unavailable from the official source; see the linked source above for the complete text.
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