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    Ethics: Court's Proposed Changes to Attorney Conduct Rules

    This summary highlights the major changes included in the Wisconsin Supreme Court's first draft of proposed modifications to the Rules of Professional Conduct for Attorneys. Written feedback that you submit by July 19 will help the State Bar make recommendations to the court in advance of the court's final order of Rule changes, expected in September.
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    Wisconsin LawyerWisconsin Lawyer
    Vol. 79, No. 7, July 2006

    Overview: Court's Proposed Changes to Attorney Conduct Rules

    This summary highlights the major changes included in the Wisconsin Supreme Court's first draft of proposed modifications to the Rules of Professional Conduct for Attorneys. Written feedback that you submit by July 19 will help the State Bar make recommendations to the court in advance of the court's final order of Rule changes, expected in September.

    by Dean R. Dietrich & Timothy J. Pierce

    On March 15, 2006, the Wisconsin Supreme Court issued an interim order containing the first draft of its proposed changes to SCR Chapter 20, the Rules of Professional Conduct for Wisconsin Attorneys (hereinafter the Rules). Many of the proposed changes are modeled after changes to the ABA Model Rules adopted by the ABA House of Delegates in 2002. The proposed Rules maintain several Wisconsin Rules that vary from the ABA Model Rules, such as the rules defining what constitutes false and misleading advertisements and requiring that lawyers disclose confidential information under certain circumstances.

    Many of the changes are editorial in nature, simply clarifying already existing duties, but some create new or different obligations for Wisconsin lawyers, especially when dealing with a client. Lawyers should be familiar with the proposed Rule changes and should provide written comment to the State Bar Ethics 2000 Review Committee on any areas of particular concern. (Please see the accompanying sidebar on how to provide written comment.)

    The major changes to the Rules are summarized below.

    Informed Consent (SCR 20:1.0(f))

    Dean R. Dietrich
    Dean R. Dietrich, Marquette 1977, of Ruder Ware, Wausau, is chair of the State Bar Professional Ethics Committee.
    Timothy J. Pierce Timothy J. Pierce, U.W. 1992, is the State Bar ethics counsel and liaison to the Professional Ethics Committee.

    Lawyers are required to obtain client consent in various circumstances. The proposed change requires the lawyer to obtain the client's "informed consent" in those circumstances in which the lawyer is now obligated to obtain "consent after consultation" with the client. The definition of informed consent, found in a new Rule, SCR 20:1.0 (entitled "Terminology"), makes clear that the lawyer must discuss all available options and alternatives, and the advantages and disadvantages of a proposed course of conduct, when presenting a matter to a client for decision.

    Scope of Representation and Allocation of Authority Between Lawyer and Client (SCR 20:1.2)

    With the exception of subsection (e), proposed SCR 20:1.2 follows ABA Model Rule 1.2 and is similar to the current Rule, which provides that the client has final authority to determine the course of representation. The proposed new subsection (e) requires insurance defense lawyers to inform the insured under an insurance policy, in writing and within a reasonable time of being retained to represent the insured, of any limitations on the scope of representation imposed by the terms of the insurance policy.

    Communication (SCR 20:1.4)

    Lawyers are obligated to keep their clients informed about all aspects of the representation and to respond to inquiries from clients about the representation. The proposed Rule brings together the many duties of communication that a lawyer owes to a client. These duties include:

    • Promptly notifying the client of any decision for or circumstance in which the client's informed consent is required;
    • Reasonably consulting with the client about how the client's objectives are to be accomplished;
    • Keeping the client reasonably informed about the status of the matter;
    • Promptly complying with the client's reasonable requests for information; and
    • Consulting with the client about any relevant limitation on the lawyer's conduct when the client expects assistance from the lawyer that is not permitted by the Rules of Professional Conduct or other law.

    Fees (SCR 20:1.5)

    Several changes have been made to the Rule governing lawyer fees. Under the proposed Rule, the lawyer must advise the client in writing of the nature and scope of the representation and the basis or rate of fees and costs that will be charged to the client. The lawyer also must advise the client whenever the basis or rate for the fees or costs is increased during the course of representation. If the lawyer reasonably believes that the fees and costs charged to the client for the representation will be less than $1,000, the lawyer still must advise the client of the representation's nature and scope and the basis or rate of the fees and costs but is not required to do so in writing.

    The proposed Rule also clarifies the ethical duties of lawyers who share fees after referring a matter to another attorney (for example, a "third of a third" of a contingent fee). The referring lawyer and the lawyer to whom the matter is referred have the same ethical responsibilities as if they were partners in a law firm, and the client must be informed in writing of and consent in writing to the terms of the referral fee arrangement.

    Confidentiality (SCR 20:1.6)

    Lawyers have a paramount duty to maintain the confidentiality of information learned during the representation of a client. Proposed SCR 20:1.6 differs from ABA Model 1.6 and retains the unique features of the current Wisconsin Rule. Notable features include:

    • Retention of the current mandatory disclosure of information to the extent necessary to prevent a client from inflicting death or substantial harm on the person or financial interests of another;
    • New, permissive disclosure to prevent death or substantial bodily harm that is reasonably likely to occur, regardless of whether the client is involved in the conduct likely to cause such harm;
    • New, permissive disclosure to seek advice about compliance with the Rules (for example, calling the State Bar's Ethics Hotline);
    • New, permissive disclosure to comply with other law or court order. This clarifies that although a lawyer must raise all nonfrivolous objections to court-ordered disclosure of information protected by SCR 20:1.6, a lawyer does not violate the Rule by complying with a court's final orders.

    Conflicts of Interest (Current Clients) (SCR 20:1.7)

    Preventing conflicts of interest in representing clients is a cornerstone of the duty of loyalty owed to a client. Proposed SCR 20:1.7 in large part follows ABA Model Rule 1.7 and refers to conflicts involving current clients as "concurrent conflicts of interest." A "concurrent conflict of interest" exists when the representation of one client is directly adverse to another client or when there is a significant risk that the representation of a current client may be materially limited by the lawyer's responsibilities or own interests. Notable features of the proposed Rule include:

    • A general definition of unwaivable conflicts;
    • Retention of the requirement in the current Rule that all waivers of conflicts be in writing and be signed by each affected client;
    • Extensive and informative comments in the Rule about many different aspects of conflicts.

    Imputed Disqualification: General Rule (SCR 20:1.10)

    Proposed SCR 20:1.10 retains the basic proposition that, in many circumstances, an individual lawyer's conflicts are imputed to other members of the firm. The proposed Rule, however, differs from the current Rule and ABA Model Rule 1.10 and, in some respects, is less restrictive on a firm's ability to accept cases despite the conflict of one of its members. New provisions include:

    • Conflicts arising from a lawyer's personal interests that do not pose a significant risk of materially limiting the representation of the client will not be imputed to the firm.
    • When a lawyer has a conflict arising from having provided only minor and isolated services to a former client, the lawyer with the conflict may be timely screened to defeat imputation of the conflict to other lawyers in the firm. Notice of the screening arrangements must be given to the affected client. For example, an associate who may have done some document review on a large case would not necessarily disqualify the associate's new firm, provided the associate was timely screened from the matter.

    Organization as Client (SCR 20:1.13)

    Representing an organization creates special ethical obligations for a lawyer. Proposed SCR 20:1.13 provides for more detailed reporting "up the ladder" when the lawyer is aware of actions in violation of law that are likely to harm the organization. In most circumstances, the lawyer must report the actions to higher decisionmakers within the organization. If that decision maker fails to appropriately address the situation, the lawyer may reveal information otherwise protected by SCR 20:1.6 to the extent necessary to protect the organization. The proposed Rule also clarifies that the mandatory disclosure requirements of SCR 20:1.6(b) apply to lawyers representing organizations.

    Client with Diminished Capacity (SCR 20:1.14)

    A lawyer who represents a client who may have diminished capacity is obligated to make sure that the client fully understands the representation and is capable of making decisions regarding the course of the representation. The new Rule adds additional actions that the attorney may take to determine whether a client suffers from a diminished capacity, including contacting individuals or entities that have the ability to take action to protect the client or seeking appointment of a guardian ad litem.

    Duties to a Prospective Client (SCR 20:1.18)

    This is a proposed new Rule that is identical to the ABA Model Rule. The Rule describes the duties that a lawyer owes to a prospective client who has met with the lawyer for purposes of seeking representation but who has not retained the lawyer or the lawyer chooses not to represent. The Rule clarifies the duty of confidentiality that the lawyer owes to the prospective client and clarifies that conflicts of interest may arise even though the lawyer has decided not to represent the prospective client. The conflict of interest that one lawyer may have from meeting with the prospective client would not be imputed to other members of the law firm, if the lawyer with the conflict is screened from involvement with the representation.

    Lawyer Serving as Intermediary (SCR 20:2.2)

    This Rule addresses situations in which the lawyer has been retained to represent two clients simultaneously. The draft of the proposed Rules eliminates SCR 20:2.2 because a lawyer's responsibilities when representing clients simultaneously are fully addressed by other Rules, such as SCR 20:1.7, under which lawyers must seek appropriate waivers of conflicts that comply with the rigorous requirements for obtaining informed consent from each client represented in the matter. The elimination of SCR 20:2.2, which was commonly called the "scrivener rule," would not prohibit situations in which a lawyer is retained by two parties as scrivener and does not advocate for either party. Lawyers simply must follow the conflict of interest rules to serve in that capacity.

    Special Responsibilities of Prosecutors (SCR 20:3.8)

    The current Rule provides guidance to prosecutors concerning the types of statements that can be made to individuals who are not represented by a lawyer. The proposed Rule clarifies and expands limitations on prosecutors to ensure that prosecutors do not unduly influence an unrepresented person when considering tactical decisions, especially in proceedings in which a deprecation of rights may occur. The proposed Rule applies in limited circumstances to municipal prosecutors, who also must be careful in their communication of information to unrepresented persons.

    Threatening Criminal Prosecution (SCR 20:3.10)

    The draft deletes SCR 20:3.10, which makes it misconduct to threaten criminal prosecution solely to gain advantage in a civil matter. The ABA Model Rules contain no similar provision, and Wisconsin's current Rule has proven difficult to enforce. To the extent such conduct would constitute the crime of extortion, it likely would be misconduct under SCR 20:8.4(b).

    Truthfulness in Statements to Others (SCR 20:4.1)

    The current Rule requires lawyers to always be truthful in making statements to other persons, whether represented or unrepresented. The proposed Rule continues this requirement but adds an additional provision that allows a lawyer to provide advice concerning (but not to participate in) lawful investigatory activities. The change clarifies that lawyers may give advice to others engaged in lawful investigatory activities in order to ensure that the investigation is conducted in accordance with applicable law and regulations.

    Guardians ad Litem (SCR 20:4.5)

    This proposed Rule has no counterpart in the ABA Model Rules. The proposed Rule makes clear that guardians ad litem are bound by the Rules of Professional Conduct consistent with their role of representing the best interests of individuals rather than the individuals personally.

    Reporting Professional Misconduct (SCR 20:8.3)

    Lawyers have an obligation to report the misconduct of another lawyer to the appropriate authority. This proposed Rule maintains the current Rule's requirement that a lawyer report the substantial misconduct of another lawyer or judge, but the proposed Rule makes clear that when reporting would require revealing information protected by SCR 20:1.6, the lawyer must consult with the client concerning the lawyer's duty to report and then abide by the client's wishes. The comment to the proposed Rule also adds to the list of entities that are exempt from the duty to report the State Bar's Law Office Management Assistance Program and the Ethics Hotline.

    Misconduct (SCR 20:8.4)

    The current Rule identifies several acts or types of behavior that are considered misconduct. The proposed Rule has two subsections not in the current Rule. The first makes plain that it is misconduct to fail to cooperate with the Office of Lawyer Regulation in the investigation of a grievance. This has always been the case, but new subsection SCR 20:8.4 was added to provide better notice to lawyers. The second new subsection makes it misconduct for a lawyer to harass a person because of that person's status (for example, age, race, gender, and so on) in connection with the lawyer's professional activities. The comment states that what constitutes harassment may be determined by relevant legislation and caselaw.

    Conclusion

    While many of the changes in the first draft of the proposed new Rules of Professional Conduct are not significantly different from the current Rules, lawyers must be aware of all of the proposed changes and will want to consider modifying their practices and procedures to ensure compliance with the anticipated new Rules of Professional Conduct. The State Bar Board of Governors will be reviewing the first draft of the Rule changes and members' written comments to determine if the State Bar should provide further comment to the Wisconsin Supreme Court during its final review of the proposed Rule changes.




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