Law Firms And Client Representation: Ethical Boundaries

Whether a law firm can represent a client depends on several factors, including potential conflicts of interest, client-lawyer confidentiality, and consent. For example, a law firm may not be able to represent a client if doing so would compromise the lawyer's independence or professional judgment due to a conflict of interest. Additionally, if a lawyer is already representing another client with opposing interests in the same matter, all parties must agree and provide informed consent for the lawyer or firm to continue representation.

Conflict of interest

A conflict of interest arises between an attorney and a client if the interests of the attorney, a different client, or a third party conflict with those of the present client. Attorneys have a duty to zealously represent the interests of their clients. If an attorney has two or more clients, these duties may conflict, making it impossible for the attorney to fulfill both at once. For example, an attorney cannot represent both the plaintiff and the defendant in a case, as advocating for one will inherently go against advocating for the other.

Attorneys must perform conflict checks when accepting new clients. A potential client must fill out a brief questionnaire to determine whether the attorney has represented or opposed the client in any other case. A lawyer may not allow related business interests to affect their representation. For instance, they cannot refer clients to an enterprise in which the lawyer has an undisclosed financial interest.

An attorney cannot represent a client where their own personal interests are adverse to those of an existing client. This type of conflict often occurs when a lawyer enters into a business transaction with a client after the formation of the attorney-client relationship. Some examples include purchasing property from the client at a below-market rate and drafting a will where the lawyer is a beneficiary.

If a conflict of interest arises in a litigation setting, a lawyer could face disqualification and have their professional ethics called into question in a public forum. They could also be compelled to disgorge fees earned from conflicted representation or have their undocumented business transaction with a client unwound.

Client-lawyer confidentiality

The principle of client-lawyer confidentiality is underpinned by three related bodies of law: the attorney-client privilege, the work product doctrine, and the rule of confidentiality established in professional ethics. The attorney-client privilege and work product doctrine apply when a lawyer is called as a witness or required to produce evidence concerning a client in judicial or other proceedings. It's important to note that the attorney-client privilege is separate from the work-product doctrine, and the former does not apply when an attorney is acting in a non-legal role, such as a business advisor.

The rule of client-lawyer confidentiality, on the other hand, applies more broadly to all information relating to the representation of a client, regardless of its source. This means that a lawyer cannot disclose any information about their client's case unless specifically authorized or required by the Rules of Professional Conduct or other laws, such as state and federal data privacy laws. This rule continues even after the client-lawyer relationship has ended.

There are, however, some limited exceptions to the confidentiality rule. For example, a lawyer may disclose information to other lawyers within their firm unless instructed otherwise by the client. Additionally, a lawyer may reveal information if they reasonably believe it is necessary to prevent certain harms, such as death, substantial bodily harm, or financial injury resulting from a client's crime or fraud. Furthermore, lawyers may disclose confidential information to secure payment for their services or to defend themselves in disciplinary or legal proceedings.

In certain situations, a client may waive their rights to confidentiality, such as when initiating proceedings against their lawyer or in the probate of a last will and testament. In the case of concurrent conflicts of interest, where a lawyer represents multiple clients with opposing interests, the attorney-client privilege does not apply, and common representation is generally not advisable.

Informed consent

A law firm can represent a client, but there are ethical guidelines and rules of professional conduct that must be followed. These rules are in place to ensure that clients are treated fairly and that their interests are protected. One of the most important concepts in this regard is "informed consent".

In some cases, a lawyer may need to obtain informed consent from a client in writing. For example, if a lawyer is representing multiple clients with potentially conflicting interests, they must obtain the informed consent of each client before proceeding. This consent should be obtained before accepting or continuing representation and must include a disclosure of the facts and circumstances, as well as a discussion of the advantages, disadvantages, and alternatives of the proposed course of conduct.

It is worth noting that informed consent does not always require the client's explicit agreement. In some cases, a lawyer may provide information and advice, and the client may make a decision based on that information without explicitly consenting. However, in cases where there is a conflict of interest, the lawyer must obtain the client's consent to continue the representation. If a conflict arises after representation has begun, the lawyer must typically withdraw from the representation unless they have obtained the informed consent of the client to continue.

Dual representation

However, there are several potential issues with dual representation. One of the main concerns is a conflict of interest. Lawyers have a duty to act in their clients' best interests and provide unbiased advice. When a lawyer represents two clients, conflicts can arise due to differing interests or objectives. In such cases, the lawyer may not be able to provide effective representation to both clients. Additionally, dual representation can lead to confusion, duplication of work, and increased costs. It can also complicate matters and hinder the ability to present a strong and cohesive case.

To address these concerns, lawyers engaging in dual representation must comply with strict disclosure rules. They must inform both parties of the potential conflict and their right to independent representation. Written agreements must be signed by all parties, acknowledging their awareness of their rights. Despite these precautions, dual representation may still result in complications, especially if a conflict arises or confidential information is disclosed, impacting the lawyer's ability to continue representing one or both clients.

Attorney-client privilege

The origins of attorney-client privilege can be traced back to medieval England, where the king presided over trials and relied on attorneys to present cases. Despite attorneys being expected to disclose all relevant information as officers of the court, courts eventually recognised that forcing them to reveal client confidences undermined justice. This led to the principle that even the king could not compel an attorney to disclose confidential communications, with Berd v. Lovelace (1577) being one of the earliest recorded cases affirming this privilege. By the 18th century, the doctrine had solidified in English common law and was later adopted in the American legal system, where it became a foundational rule of professional ethics.

There are, however, certain exceptions to attorney-client privilege. The privilege does not apply if the communication was made in the presence of or disclosed to individuals who are neither the attorney nor the client. Additionally, if the communication was made for the purpose of committing a crime, tort, or fraud, the privilege may be waived. The privilege also does not extend to communications solely related to non-legal business matters or when the attorney is acting in a non-legal role, such as a business advisor or member of the board of directors.

It is important to note that attorney-client privilege can be limited or overridden by public policy interests, such as protecting a child. Furthermore, if a third party is essential to the attorney-client relationship, such as an interpreter, their presence during privileged communication does not compromise confidentiality. In the case of common representation, where a lawyer represents multiple clients, the privilege does not attach between the commonly represented clients, and they should be advised accordingly.

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