When a lawyer is on contract to a government entity, sits on a client's board, or has firm members serving as guardians ad litem, can the lawyer also represent clients whose interests look adverse to those responsibilities?

Plain-English summary

A number of attorneys asked the committee whether they could represent clients given other responsibilities that appeared to create conflicts: lawyers on contract to the Risk Management Division to defend the state who wanted to represent private clients in unrelated litigation against the state (a land matter, court-appointed neglect representation); a Navajo Nation Bar member on contract to the tribe who could be appointed to defend criminal cases prosecuted by the Navajo Nation; a lawyer wanting to represent a financial institution while a partner sat on its board; and a firm whose members served as guardians ad litem in some neglect cases while representing respondents in others. The committee located the answer in Rule 16-107 and its commentary.

The committee concluded that Rule 16-107 permits representation that appears adverse to another client or limited by the lawyer's other responsibilities, subject to two requirements: first, the lawyer must reasonably believe he can undertake both representations without adverse effect on either; second, the lawyer must obtain each client's consent after explaining all implications, advantages, and risks. Drawing on the commentary, it added that the reasonable-belief test must be satisfied before seeking consent: when a disinterested lawyer would conclude the client should not agree, the lawyer should not ask for consent. For the government-contract situations, the committee concluded a lawyer on contract as to a particular matter could generally represent clients in totally unrelated suits against the entity, provided the dual representation would not adversely affect either client and both consented after consultation, including telling the client why the client might hesitate.

On the lawyer-director situation, the committee adopted the rule's commentary in full: the lawyer should weigh the frequency and intensity of potential conflicts, the effect of resigning from the board, and the corporation's ability to get advice elsewhere, and should not serve as director if there is a material risk that the dual role will compromise independent professional judgment. It noted a sophisticated corporation could waive the conflict on full disclosure, but the representation should not be undertaken, even with consent, if the lawyer-director believes he could not be totally objective. On the guardian ad litem situation, the answer again depended on the facts: firm members taking diametrically opposite positions on neglect before the same court should not attempt the dual representation, while different courts or unrelated issues could permit it with each client's consent. In all situations the lawyers must first be satisfied they can undertake both representations without compromising either, and resolve any doubt against doing so.

Currency note

This opinion was issued in 1990, under the New Mexico Rules of Professional Conduct effective January 1, 1987 (SCRA 1986, Rule 16-107). It predates the State Bar of New Mexico's November 3, 2008 revisions to those Rules (the New Mexico adoption of the ABA Ethics 2000 changes), which restructured the conflict-of-interest rule and its consent and reasonable-belief standards. 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: Can a lawyer on contract to a government agency sue that agency for a private client?

A: The committee concluded a lawyer on contract as to a particular matter could generally represent clients in totally unrelated suits against the entity, if the lawyer reasonably believes neither client will be adversely affected and both consent after consultation.

Q: What must a lawyer decide before even asking clients to consent to a conflict?

A: The committee concluded the lawyer must first apply the disinterested-lawyer test: if a disinterested lawyer would conclude the client should not agree, the lawyer should not ask for consent.

Q: Can a lawyer represent a corporation while a partner sits on its board?

A: The committee adopted the commentary's factors and concluded the lawyer should not serve as director if there is a material risk the dual role will compromise independent judgment, and should not undertake the representation even with consent if unable to be totally objective.

Q: Can different lawyers in one firm take opposite sides in similar neglect cases?

A: It depends on the facts. The committee concluded that taking diametrically opposite positions before the same court should not be attempted, while different courts or unrelated issues could permit it with each client's consent.

Background and rules framework

The opinion interpreted Rule 16-107, New Mexico's general conflict-of-interest rule (corresponding to Model Rule 1.7), and relied heavily on the rule's commentary, including the passages on representing an enterprise with diverse operations and on a lawyer who serves as a director of a client organization. The committee read the rule as a two-part gate (reasonable belief of no adverse effect, then informed consent of both clients) with the disinterested-lawyer standard governing whether consent may even be sought.

Citations and references

Rules of Professional Conduct:

• Rule 16-107 (conflict of interest; general rule) and its committee commentary

See also

• NM Ethics Op. 1990-1: Municipal Attorney - Conflict of Interest

Source

• Landing page: https://www.sbnm.org/Leadership/Committees/Ethics-Advisory-Committee/Ethics-Advisory-Opinions
• Original PDF: https://www.sbnm.org/Portals/NMBAR/AboutUs/committees/Ethics/1990-92/1990-3.pdf

Original opinion text

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

Advisory Opinion 1990-3
A number of attorneys have asked for the Committee's advice concerning their ability to represent clients in light of their
other responsibilities. Some of the requests pose direct questions about whether the attorney may ethically undertake the
representation; others assume that the attorney either can or cannot undertake the representation and ask questions
concerning the consequences. Guidance in all of these situations is found in SCRA 1986, 16-107 and the commentaries
thereto. We therefore set forth the situations and then discuss the application of the rule and commentaries.
1. Several attorneys have asked whether their being on contract to the Risk Management Division to defend the state in
civil tort litigation precludes their representation of private clients in other areas of litigation in which the state is a party.
Specifically, one attorney wishes to represent a client in litigation concerning real property in which the State Land Office
has an interest. Another attorney wishes to know if he can accept court appointment to represent respondents in neglect
matters.
2. A similar situation is presented by an attorney who is a member of Navajo Nation Bar. He is on contract to the Navajo
Nation, representing a particular tribal enterprise. Judges of the courts of the Navajo Nation appoint members of the
Navajo Nation Bar to represent defendants in criminal cases prosecuted by Navajo Nation Department of Justice.
3. Another attorney wishes to know if he may represent a financial institution in litigation matters when his partner sits on
the board of the institution.
4. An attorney wishes to know if his firm may represent respondents in neglect cases when members of his firm are
guardians ad litem for children in other neglect cases.
In all of these situations, the representation of one client appears to be adverse to another client or appears to be limited
by the lawyer's responsibilities to another. Rule 16-107 specifically permits such representation subject to following two
requirements. First, the lawyer must reasonably believe that he can undertake both representations without adverse effect
on either one. Second, the lawyer must obtain the consent of both clients after explaining all of the implications,
advantages, and risks involved.
In each of the above situations, the Committee can conceive of circumstances pursuant to which it would be permissible
to undertake the representation and circumstances pursuant to which it would be impermissible. The commentary to the
rule states, "a lawyer representing an enterprise with diverse operations may accept employment as an advocate against
the enterprise in an unrelated matter if doing so will not adversely affect the lawyer's relationship with the enterprise or
conduct of the suit and if both clients consent upon consultation." It would seem that, in the situations where the lawyer is
on contract to a governmental entity as to a particular matter, that lawyer could represent clients in suits against the entity
on totally unrelated matters. Examples of these situations are where the lawyer having a Risk Management contract or a
contract with the tribe regarding a particular retail enterprise wishes to represent a client in a land transaction or a client
accused of child neglect under the Children's Code or a crime under the Criminal Code. In these cases, it would appear
that the lawyer could reasonably believe that the dual representation would affect neither client adversely. The
commentary to the rule gives the following guidance on whether a lawyer could so reasonably believe. It states that, when
a disinterested lawyer would conclude that the client should not agree to the dual representation, the lawyer should not
ask for consent. This implies that before disclosure to and consent of the client the lawyer must conclude that no lawyer
would reasonably believe that the dual representation would affect either client adversely.
Of course, the lawyer must obtain the informed consent of each client. In fulfilling the duty of consultation, the lawyer
would have to explain to the client exactly why the client might want to consent. Thus, for example, the lawyer with the
Risk Management contract who wishes to represent the respondent in a neglect matter would have to advise the
respondent that the lawyer has a contract with the state in an unrelated matter due to which the respondent might think
the lawyer would not give best efforts on behalf of the respondent. The lawyer may assure respondent that this is not the
case and that the lawyer reasonably believes that he can undertake the representation without adverse affect on either
client. However, the lawyer should advise the respondent that it is respondent's decision whether to consent. Similarly,
Risk Management, either in the contract of employment or on a case by case basis, would also have to give its informed
consent.

The law firm, a member of which sits on the board of a financial institution, presents a similar situation. The commentary
to the rule contains extensive guidance on this issue, which we adopt in full herein;
A lawyer for a corporation or other organization who is also a member of its board of directors should determine whether
the responsibilities of the two roles may conflict. The lawyer may be called on to advise the corporation in matters
involving actions of the directors. Consideration should be given to the frequency with which such situations may arise,
the potential intensity of the conflict, the effect of the lawyer's resignation from the board and the possibility of the
corporation's obtaining legal advice from another lawyer in such situations. If there is material risk that the dual role will
compromise the lawyer's independence of professional judgment, the lawyer should not serve as director.
The lawyer concerned with this problem specifically referred to the possibility that the lawyer/director could not be totally
objective in making board decisions which would affect the amount of business his firm would get in litigation. It appears
to the Committee that, while this type of conduct is a realistic possibility, any potential conflict created by it could be
waived by a sophisticated business corporation upon full disclosure. However, if the lawyer/director believes he or she
could not be totally objective, the representation should not be undertaken, even with the consent of the corporation.
Furthermore, because the exercise of professional judgment, both as an attorney and as a director is a continuing
responsibility, the lawyer/director must continually assess the impact of positions taken and of facts developed to assure
the necessary independence of professional judgment.
Finally, the question concerning some members of the firm acting as guardians ad litem while others are representing
other parties in similar litigation raises the same concerns as discussed above. Again, our answer will depend on the
facts. If, for example, the attorneys are to appear before the same trial or appellate court and take diametrically opposite
positions on what constitutes neglect sufficient to remove the children from the home, the commentary to the rule
indicates the lawyers should not attempt the dual representation. On the other hand, if the lawyers are before different
courts or the issues in the cases are not related, it would not be improper for the firm to seek the consent of each client to
simultaneous representation.
In all situations, the lawyers first must be satisfied that they can actually undertake both representations without
compromising either. If the lawyers have any doubts about whether they can do this or about whether a disinterested
lawyer would believe they can do this, those doubts should be resolved against attempting to undertake both
representations. Once the lawyers conclude they may seek the consent of the clients, a full and fair disclosure must be
made to the clients. This disclosure must include advice on all of the advantages and, particularly, disadvantages of the
proposed course of action. Finally, both clients must consent. Only when these requirements are met may lawyers
represent what may appear to be adverse interests.