March 19, 2014 – Conflicts may arise for lawyers acting in a dual capacity, including those serving as directors for client organizations. In this video, State Bar ethics advisors Tim Pierce and Aviva Kaiser explain that a lawyer’s role as a director may limit the lawyer’s ability to fully represent the client in future legal matters, thus the lawyer must secure a written advance waiver of conflicts.
When your first role with an organization has been as a lawyer and the organization asks you to sit on the board, it is important to have a conflict waiver drawn up. A conflicts analysis is a forward-ooking document, where the lawyer states that there is a significant risk material limitation on the lawyer’s ability to represent the client in the future if the lawyer is asked to act in another role.
It is important to note that Rule 1.7 does not mean significant in the sense of likelihood, it means significant in the sense of importance or risk. It is incumbent on the lawyer to explain this in writing to the client and to get their consent before moving forward.
While there is a reasonable assumption that it may never happen, the client has the right to know before they decide they want a lawyer to perform these dual roles. The organization must decide if it wishes to preserve the ability to have the lawyer represent its legal needs.
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Read “Untangling Third-person Conflicts of Interest,” published in March 2014,Wisconsin Lawyer™ magazine. Dean Dietrich says determining whether a potential client’s interests might clash with those of a colleague requires predicting the likelihood of future conflicts.
For more information on this subject, see State Bar of Wisconsin PINNACLE’s program, Ethical Issues of Volunteer Board Membership, available as a webcast replay on March 31, 2014 and May 13, 2014, or through CLE OnDemand.