Me. R. Prof. Cond. 1.7
Me. R. Prof. Cond. 1.7
Advisory Note-October 2018
Rule 1.8(j) has been adopted, and therefore Comment [12] to this Rule is no longer correct in stating that "Maine has not adopted the ABA Model Rules' categorical prohibition on an attorney forming a sexual relationship with an existing client." See Rule 1.8(j) and Advisory Committee Note thereto of even date. Rule 1.7 has not been amended in any way on this date.
COMMENT
General Principles
[1] Loyalty and independent judgment are essential elements in the lawyer's relationship to a client. Concurrent conflicts of interest can arise from the lawyer's responsibilities to another client, a former client or a third person or from the lawyer's own interests. For specific Rules regarding certain concurrent conflicts of interest, see Rule 1.8. For former client conflicts of interest, see Rule 1.9. For conflicts of interest involving prospective clients, see Rule 1.18. For definitions of "informed consent" and "confirmed in writing," see Rule 1.0(e) and (b).
[2] Resolution of a conflict-of-interest problem under this Rule requires the lawyer to: (1) clearly identify the client or clients; (2) determine whether a conflict-of-interest exists; (3) decide whether the representation may be undertaken despite the existence of a conflict, i.e., whether the conflict is consentable; and (4) if so, consult with the clients affected under paragraph (a) and obtain their informed consent, confirmed in writing. The clients affected under paragraph (a) include both of the clients referred to in paragraph (a)(1) and the one or more clients whose representation might be materially limited under paragraph (a)(2).
[3] A conflict-of-interest may exist before representation is undertaken, in which event the representation must be declined, unless the lawyer obtains the informed consent of each client under the conditions of paragraph (b). To determine whether a conflict-of-interest exists, a lawyer should adopt reasonable procedures, appropriate for the size and type of firm and practice, to determine in both litigation and non-litigation matters the persons and issues involved. See also Comment to Rule 5.1. Subject to the exception set forth in Comment [24] with respect to "issue conflicts," ignorance caused by a failure to institute such procedures will not excuse a lawyer's violation of this Rule. As to whether a client-lawyer relationship exists or, having once been established, is continuing, see Comment to Rule 1.3 and Scope.
[4] If a conflict arises after representation has been undertaken, the lawyer ordinarily must withdraw from the representation, unless the lawyer determines the conflict is consentable and has obtained the informed consent of the client under the conditions of paragraph (b). See Rule 1.16. Where more than one client is involved, whether the lawyer may continue to represent any of the clients is determined both by the lawyer's ability to comply with duties owed to the former client and by the lawyer's ability to represent adequately the remaining client or clients, given the lawyer's duties to the former client. See Rule 1.9. See also Comments [5] and [29].
[5] Unforeseeable developments, such as changes in corporate and other organizational affiliations or the addition or realignment of parties in litigation, might create conflicts in the midst of a representation, as when a company sued by the lawyer on behalf of one client is bought by another client represented by the lawyer in an unrelated matter. Depending on the circumstances, the lawyer may have the option to withdraw from one of the representations in order to avoid the conflict. The lawyer must seek court approval where necessary and take steps to minimize harm to the clients. See Rule 1.16. The lawyer must continue to protect the confidences of the client from whose representation the lawyer has withdrawn. See Rule 1.9(c).
Identifying Conflicts of Interest: Directly Adverse
[6] Loyalty to a current client prohibits undertaking representation directly adverse to that client without that client's informed consent. Thus, absent a determination by the lawyer that the conflict is consentable and the grant of consent by the client, a lawyer may not act as an advocate in one matter against a person the lawyer represents in some other matter, even when the matters are wholly unrelated. The client as to whom the representation is directly adverse is likely to feel betrayed, and the resulting damage to the client-lawyer relationship is likely to impair the lawyer's ability to represent the client effectively. In addition, the client on whose behalf the adverse representation is undertaken reasonably may fear that the lawyer will pursue that client's case less effectively out of deference to the other client, i.e., that the representation may be materially limited by the lawyer's interest in retaining the current client. Similarly, a directly adverse conflict may arise when a lawyer is required to cross-examine a client who appears as a witness in a lawsuit involving another client, as when the testimony will be damaging to the client who is represented in the lawsuit. on the other hand, simultaneous representation in unrelated matters of clients whose interests are only economically adverse, such as representation of competing economic enterprises in unrelated litigation, does not ordinarily constitute a conflict-of-interest and thus may not require consent of the respective clients.
[7] Directly adverse conflicts can also arise in transactional matters. For example, if a lawyer is asked to represent the seller of a business in negotiations with a buyer represented by the lawyer, not in the same transaction but in another, unrelated matter, the lawyer could not undertake the representation without determining that the conflict may be waived by consent and the grant of informed consent by each client.
Identifying Conflicts of Interest: Material Limitation
[8] Even where there is no direct adverseness, a conflict-of-interest exists if there is a significant risk that a lawyer's ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the lawyer's other responsibilities or interests. For example, a lawyer asked to represent several individuals seeking to form a joint venture is likely to be materially limited in the lawyer's ability to recommend or advocate all possible positions that each might take because of the lawyer's duty of loyalty to the others. The conflict in effect forecloses alternatives that would otherwise be available to the client. The mere possibility of subsequent harm does not itself require disclosure and consent. The critical questions are the likelihood that a difference in interests will eventuate and, if it does, whether it will materially interfere with the lawyer's independent professional judgment in considering alternatives or foreclose courses of action that reasonably should be pursued on behalf of the client.
Lawyer's Responsibilities to Former Clients and Other Third Persons
[9] In addition to conflicts with other current clients, a lawyer's duties of loyalty and independence may be materially limited by responsibilities to former clients under Rule 1.9 or by the lawyer's responsibilities to other persons, such as fiduciary duties arising from a lawyer's service as a trustee, executor or corporate director.
Personal Interest Conflicts
[10] The lawyer's own interests should not be permitted to have an adverse effect on representation of a client. For example, if the probity of a lawyer's own conduct in a transaction is in serious question, it may be difficult or impossible for the lawyer to give a client detached advice. Similarly, when a lawyer has discussions concerning possible employment with an opponent of the lawyer's client, or with a law firm representing the opponent, such discussions could materially limit the lawyer's representation of the client. In addition, a lawyer may not allow related business interests to affect representation, for example, by referring clients to an enterprise in which the lawyer has an undisclosed financial interest. See Rule 1.8 for specific Rules pertaining to a number of personal interest conflicts, including business transactions with clients. See also Rule 1.10 (personal interest conflicts under Rule 1.7 ordinarily are not imputed to other lawyers in a law firm).
[11] When lawyers representing different clients in the same matter or in substantially related matters are closely related by blood or marriage, there may be a significant risk that client confidences will be revealed and that the lawyer's family relationship will interfere with both loyalty and independent professional judgment. As a result, each client is entitled to know of the existence and implications of the relationship between the lawyers before the lawyer agrees to undertake the representation. Thus, a lawyer related to another lawyer, e.g., as parent, child, sibling or spouse, ordinarily may not represent a client in a matter where that lawyer is representing another party, unless each client gives informed consent. The disqualification arising from a close family relationship is personal and ordinarily is not imputed to members of firms with whom the lawyers are associated. See Rule 1.10. See also Rule 1.8(l).
[12] Maine has not adopted the ABA Model Rules' categorical prohibition on an attorney forming a sexual relationship with an existing client because such a rule seems unnecessary to address true disciplinary problems and it threatens to make disciplinary issues out of conduct that we do not believe should be a matter of attorney discipline. However, the lack of a categorical prohibition should not be construed as an implicit approval of such relationships. Attorneys have been disciplined under the former Maine Code of Professional Responsibility for entering into sexual relations with clients, and they may be disciplined for similar conduct under these rules. The relationship between lawyer and client is a fiduciary one in which the lawyer occupies the highest position of trust and confidence. In certain types of representations such as family or juvenile matters, the relationship is almost always unequal; thus, a sexual relationship between lawyer and client in such circumstance may involve unfair exploitation of the lawyer's fiduciary role, in violation of the lawyer's basic ethical obligation not to use the trust of the client to the client's disadvantage. In addition, such a relationship presents a significant danger that, because of the lawyer's emotional involvement, the lawyer will be unable to represent the client without impairment of the exercise of independent professional judgment. Moreover, a blurred line between the professional and personal relationships may make it difficult to predict to what extent client confidences will be protected by the attorney-client evidentiary privilege, since client confidences are protected by privilege only when they are imparted in the context of the client-lawyer relationship. Before proceeding with the representation in these circumstances, the lawyer should consider whether the lawyer's ability to represent the client will be materially limited by the sexual relationship.
Interest of Person Paying for a Lawyer's Service
[13] A lawyer may be paid from a source other than the client, including a co-client, if the client is informed of that fact and consents and the arrangement does not compromise the lawyer's duty of loyalty or independent judgment to the client. See Rule 1.8(f). If acceptance of the payment from any other source presents a significant risk that the lawyer's representation of the client will be materially limited by the lawyer's own interest in accommodating the person paying the lawyer's fee or by the lawyer's responsibilities to a payer who is also a co-client, then the lawyer must comply with the requirements of paragraph (b) before accepting the representation, including determining whether the conflict is consentable and, if so, that the client has adequate information about the material risks of the representation.
Prohibited Representations
[14] In many instances, clients may consent to representation notwithstanding a conflict. However, as indicated in paragraph (c), some conflicts are nonconsentable, meaning that the lawyer involved cannot properly ask for such agreement or provide representation on the basis of the client's consent. When a disinterested lawyer would conclude that the client should not agree to the representation under the circumstances, the lawyer involved cannot properly ask for such agreement or provide representation on the basis of the client's consent. When the lawyer is representing more than one client, the question of consentability must be resolved as to each client.
[15] Consentability is typically determined by considering whether the interests of the clients will be adequately protected if the clients are permitted to give their informed consent to representation burdened by a conflict-of-interest. Thus, under paragraph (b)(1), representation is prohibited if in the circumstances the lawyer cannot reasonably conclude that the lawyer will be able to provide competent and diligent representation. See Rule 1.1 (competence) and Rule 1.3 (diligence).
[16] Paragraph (c)(1) describes conflicts that are nonconsentable because the representation is prohibited by applicable law. For example, in some states substantive law provides that the same lawyer may not represent more than one defendant in a capital case, even with the consent of the clients, and under federal criminal statutes certain representations by a former government lawyer are prohibited, despite the informed consent of the former client. In addition, decisional law in some states limits the ability of a governmental client, such as a municipality, to consent to a conflict-of-interest.
[17] Paragraph (c)(2) describes conflicts that are nonconsentable because of the institutional interest in vigorous development of each client's position when the clients are aligned directly against each other in the same litigation or other proceeding before a tribunal. Whether clients are aligned directly against each other within the meaning of this paragraph requires examination of the context of the proceeding. Although this paragraph does not preclude a lawyer's multiple representation of adverse parties to a mediation (because mediation is not a proceeding before a "tribunal" under Rule 1.0(m) ), such representation may be precluded by paragraph (b)(1).
Informed Consent
[18] Informed consent requires that each affected client be aware of the relevant circumstances and of the material and reasonably foreseeable ways that the conflict could have adverse effects on the interests of that client. Whether a client has given informed consent to representation, when required by this Rule or Rule 1.8, shall be determined in light of the mental capacity of the client to give consent, the explanation of the advantages and risks involved provided by the lawyer seeking consent, the circumstances under which the explanation was provided and the consent obtained, the experience of the client in legal matters generally, and any other circumstances bearing on whether the client has made a reasoned and deliberate choice. See Rule 1.0(e) (informed consent). The lawyer must reasonably believe that each client will be able to make adequately informed decisions during the representation and, to that end, the lawyer must consult with each client concerning the decisions to be made and the considerations relevant in making them, so that each client can make adequately informed decisions. See
Rule 1.4. The information required depends on the nature of the conflict and the nature of the risks involved. When representation of multiple clients in a single matter is undertaken, the information must include the implications of the common representation, including possible effects on loyalty, confidentiality and the attorney-client privilege and the advantages and risks involved. See Comments [30] and [31] (effect of common representation on confidentiality).
[19] Under some circumstances it may be impossible to make the disclosure necessary to obtain consent. For example, when the lawyer represents different clients in related matters and one of the clients refuses to consent to the disclosure necessary to permit the other client to make an informed decision, the lawyer cannot properly ask the latter to consent. In some cases the alternative to common representation can be that each party may have to obtain separate representation with the possibility of incurring additional costs. These costs, along with the benefits of securing separate representation, are factors that may be considered by the affected client in determining whether common representation is in the client's interests.
Consent Confirmed in Writing
[20] Paragraph (b) requires the lawyer to obtain the informed consent of the client, confirmed in writing. Such a writing may consist of a document executed by the client or one that the lawyer promptly records and transmits to the client following an oral consent. See Rule 1.0(b). See also Rule 1.0(n) (writing includes electronic transmission). If it is not feasible to obtain or transmit the writing at the time the client gives informed consent, then the lawyer must obtain or transmit it within a reasonable time thereafter. See Rule 1.0(b). The requirement of a writing does not supplant the need in most cases for the lawyer to talk with the client, to explain the risks and advantages, if any, of representation burdened with a conflict-of-interest, as well as reasonably available alternatives, and to afford the client a reasonable opportunity to consider the risks and alternatives and to raise questions and concerns. Rather, the writing is required in order to impress upon clients the seriousness of the decision the client is being asked to make and to avoid disputes or ambiguities that might later occur in the absence of a writing.
Revoking Consent
[21] A client who has given consent to a conflict may revoke the consent and, like any other client, may terminate the lawyer's representation at any time. Whether revoking consent to the client's own representation precludes the lawyer from continuing to represent other clients depends on the circumstances, including the nature of the conflict, whether the client revoked consent because of a material change in circumstances, the reasonable expectations of the other client and whether material detriment to the other clients or the lawyer would result.
Consent to Future Conflict
[22] Whether a lawyer may properly request a client to waive conflicts that might arise in the future is subject to the test of paragraph (b). The effectiveness of such waivers is generally determined by the extent to which the client reasonably understands the material risks that the waiver entails. The more comprehensive the explanation of the types of future representations that might arise and the actual and reasonably foreseeable adverse consequences of those representations, the greater the likelihood that the client will have the requisite understanding. Thus, if the client agrees to consent to a particular type of conflict with which the client is already familiar, then the consent ordinarily will be effective with regard to that type of conflict. If the consent is general and open-ended, then the consent ordinarily will be ineffective, because it is not reasonably likely that the client will have understood the material risks involved. On the other hand, if the client is an experienced user of the legal services involved and is reasonably informed regarding the risk that a conflict may arise, such consent is more likely to be effective, particularly if, e.g., the client is independently represented by other counsel in giving consent and the consent is limited to future conflicts unrelated to the subject of the representation. In any case, advance consent cannot be effective if the circumstances that materialize in the future are such as would make the conflict nonconsentable under paragraph (b)(1) or paragraph (c).
Conflicts in Litigation
[23] Paragraph (c)(2) prohibits representation of opposing parties in the same litigation, regardless of the clients' consent. On the other hand, simultaneous representation of parties whose interests in litigation may conflict, such as coplaintiffs or codefendants, is governed by paragraph (a)(2) and paragraph (b). A conflict may exist by reason of substantial discrepancy in the parties' testimony, incompatibility in positions in relation to an opposing party or the fact that there are substantially different possibilities of settlement of the claims or liabilities in question. Such conflicts can arise in criminal cases as well as civil. The potential for conflict-of-interest in representing multiple defendants in a criminal case is so grave that ordinarily a lawyer should decline to represent more than one codefendant. On the other hand, common representation of persons having similar interests in civil litigation is proper if the requirements of paragraph (b) are met.
[24] The mere fact that advocating a legal position on behalf of one client might create precedent adverse to the interests of a client represented by the lawyer in an unrelated matter does not create a conflict-of-interest. A conflict-of-interest exists, however, if there is a significant risk that a lawyer's action on behalf of one client will materially limit the lawyer's effectiveness in representing another client in a different case; for example, when a decision favoring one client will create a precedent likely to seriously weaken the position taken on behalf of the other client. Factors relevant in determining whether the clients need to be advised of the risk include: where the cases are pending, whether the issue is substantive or procedural, the temporal relationship between the matters, the significance of the issue to the immediate and long-term interests of the clients involved and the clients' reasonable expectations in retaining the lawyer. If there is significant risk of material limitation, then absent informed consent of the affected clients, the lawyer must refuse one of the representations or withdraw from one or both matters. Under Maine law and practice, this Rule is violated only if an attorney does not obtain informed consent to an issue conflict that rises to the level of a conflict-of-interest described in Rule 1.7(a), and is actually known by the lawyer. A lawyer does not violate this Rule merely by being ignorant of the existence of an issue conflict. There are situations where, because of the risk of material limitation of a client representation, that an issue conflict can be a true (albeit consentable) conflict-of-interest. The intent of this Rule and this paragraph is not to create a conflict-of-interest-screening requirement that has not heretofore existed in Maine.
[25] When a lawyer represents or seeks to represent a class of plaintiffs or defendants in a class-action lawsuit, unnamed members of the class are ordinarily not considered to be clients of the lawyer for purposes of applying paragraph (b) of this Rule. Thus, the lawyer does not typically need to get the consent of such a person before representing a client suing the person in an unrelated matter. Similarly, a lawyer seeking to represent an opponent in a class action does not typically need the consent of an unnamed member of the class whom the lawyer represents in an unrelated matter.
Nonlitigation Conflicts
[26] Conflicts-of-interest under paragraphs (a)(1) and (a)(2) arise in contexts other than litigation. For a discussion of directly adverse conflicts in transactional matters, see Comment [7]. Relevant factors in determining whether there is significant potential for material limitation include the duration and intimacy of the lawyer's relationship with the client or clients involved, the functions being performed by the lawyer, the likelihood that disagreements will arise and the likely prejudice to the client from the conflict. The question is often one of proximity and degree. See Comment [8].
[27] For example, conflict questions may arise in estate planning and estate administration. A lawyer may be called upon to prepare wills for several family members, such as husband and wife, and, depending upon the circumstances, a conflict-of-interest may be present. In estate administration the identity of the client may be unclear under the law of a particular jurisdiction. In order to comply with conflict-of-interest rules, the lawyer should make clear the lawyer's relationship to the parties involved.
[28] Whether a conflict is consentable depends on the circumstances. For example, a lawyer may not represent multiple parties to a negotiation whose interests are fundamentally antagonistic to each other, but common representation is permissible where the clients are generally aligned in interest even though there is some difference in interest among them. Thus, a lawyer may seek to establish or adjust a relationship between clients on an amicable and mutually advantageous basis; for example, in helping to organize a business in which two or more clients are entrepreneurs, working out the financial reorganization of an enterprise in which two or more clients have an interest or arranging a property distribution in settlement of an estate. The lawyer seeks to resolve potentially adverse interests by developing the parties' mutual interests. Otherwise, each party might have to obtain separate representation, with the possibility of incurring additional cost, complication or even litigation. Given these and other relevant factors, the clients may prefer that the lawyer act for all of them.
Special Considerations in Common Representation
[29] In considering whether to represent multiple clients in the same matter, a lawyer should be mindful that if the common representation fails because the potentially adverse interests cannot be reconciled, the result can be additional cost, embarrassment and recrimination. Ordinarily, the lawyer will be forced to withdraw from representing all of the clients if the common representation fails. In some situations, the risk of failure is so great that multiple representation is plainly impossible. For example, a lawyer cannot undertake common representation of clients where contentious litigation or negotiations between them are imminent or contemplated. Moreover, because the lawyer is required to be impartial between commonly represented clients, representation of multiple clients is improper when it is unlikely that impartiality can be maintained. Generally, if the relationship between the parties has already assumed antagonism, the possibility that the clients' interests can be adequately served by common representation is not very good. Other relevant factors are whether the lawyer subsequently will represent both parties on a continuing basis and whether the situation involves creating or terminating a relationship between the parties.
[30] A particularly important factor in determining the appropriateness of common representation is the effect on client-lawyer confidentiality and the attorney-client privilege. With regard to the attorney-client privilege, the prevailing rule is that, as between commonly represented clients, the privilege does not attach. But see M.R. Evid. 502(d)(5). Hence, it must be assumed that if litigation eventuates between the clients, the privilege will not protect any such communications, and the clients should be so advised.
[31] As to the duty of confidentiality, continued common representation will almost certainly be inadequate if one client asks the lawyer not to disclose to the other client information relevant to the common representation. This is so because the lawyer has an equal duty of loyalty to each client, and each client has the right to be informed of anything bearing on the representation that might affect that client's interests and the right to expect that the lawyer will use that information to that client's benefit. See Rule 1.4. The lawyer should, at the outset of the common representation and as part of the process of obtaining each client's informed consent, advise each client that information will be shared and that the lawyer will have to withdraw if one client decides that some matter material to the representation should be kept from the other. In limited circumstances, it may be appropriate for the lawyer to proceed with the representation when the clients have agreed, after being properly informed, that the lawyer will keep certain information confidential. For example, the lawyer may reasonably conclude that failure to disclose one client's trade secrets to another client will not adversely affect representation involving a joint venture between the clients and agree to keep that information confidential with the informed consent of both clients.
[32] When seeking to establish or adjust a relationship between clients, the lawyer should make clear that the lawyer's role is not that of partisanship normally expected in other circumstances and, thus, that the clients may be required to assume greater responsibility for decisions than when each client is separately represented. Any limitations on the scope of the representation made necessary as a result of the common representation should be fully explained to the clients at the outset of the representation. See Rule 1.2(c).
[33] Subject to the above limitations, each client in the common representation has the right to loyal and diligent representation and the protection of Rule 1.9 concerning the obligations to a former client. The client also has the right to discharge the lawyer as stated in Rule 1.16.
Organizational Clients
[34] A lawyer who represents a corporation or other organization does not, by virtue of that representation, necessarily represent any constituent or affiliated organization, such as a parent or subsidiary. See Rule 1.13(a). Thus, the lawyer for an organization is not barred from accepting representation adverse to an affiliate in an unrelated matter, unless the circumstances are such that the affiliate should also be considered a client of the lawyer, there is an understanding between the lawyer and the organizational client that the lawyer will avoid representation adverse to the client's affiliates, or the lawyer's obligations to either the organizational client or the new client are likely to limit materially the lawyer's representation of the other client.
[35] 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 a director or should cease to act as the corporation's lawyer when conflicts of interest arise. The lawyer should advise the other members of the board that in some circumstances matters discussed at board meetings while the lawyer is present in the capacity of director might not be protected by the attorney-client privilege and that conflict-of-interest considerations might require the lawyer's recusal as a director or might require the lawyer and the lawyer's firm to decline representation of the corporation in a matter.
REPORTER'S NOTES:
Model Rule 1.7(2002) corresponds to M. Bar R. 3.4(b) and (c), and addresses conflicts of interest with respect to concurrent representation of clients. In substance, Model Rule 1.7(2002) does not represent a significant departure from the treatment of conflicts of interest in M. Bar R. 3.4. Accordingly, the Task Force recommended the adoption of the structure of Model Rule 1.7(2002), with some clarifying adjustments. The Restatement §§ 121, 122, 123, 128 and 129 are generally in accord with Model Rule 1.7(2002).
The conflicts of interest rules preserve a lawyer's loyalty to his or her clients. A conflict-of-interest may also implicate issues relating to confidentiality. Even in cases where there is little or no chance of disclosing client confidences or secrets, however, representation may be prohibited because of the presence of a conflict-of-interest that may be viewed, from the client's perspective, as a concession of their lawyer's loyalty.
The Task Force recognized that some conflicts of interest can be cured, and others can not. The recommendation to divide Model Rule 1.7(b) (2002) into M. Bar R. 1.7(b) and (c) was not meant to be a change in substance from the 2002 Model Rule formulation: the purpose was to make explicit the types of conflicts that can be cured, and the types of conflicts that can not. Rule 1.7(b) provides for a conflict-of-interest cure by "consent plus." This means when a conflict-of-interest is found, (except in circumstances described in paragraph (c)) for the lawyer to engage in the concurrent representation, each client must give "informed consent" to the conflict (as defined in Maine Rules of Professional Conduct 1.0(e) ), and the lawyer must reasonably believe that he or she will be able to provide competent and diligent representation to each client. This "consent plus" concept is not meant to be a substantive departure from the standard set forth in M. Bar R. 3.4(c)(2)(i): a client's consent is valid only in those instances in which a disinterested lawyer would conclude that the risk of inadequate representation is minimal. The Task Force recognized this standard was an objective one: the lawyer's independent judgment must be measured against the judgment of the "reasonable lawyer." Model Rule 1.7(2002) and M. Bar R. 3.4(b) and (c) both identify a conflict-of-interest when a lawyer is representing one client and simultaneously representing another client, while the clients' interests are adverse. A classic illustration of this type of conflict is A suing B, when a lawyer is representing both A and B. Pursuant to M. Bar R. 3.4(c)(2), and Model Rule 1.7(2002), however, the matters involved do not have to be related. M. Bar R. 3.4(c)(2) explicitly states adversity between clients may exist in unrelated matters. Model Rule 1.7(2002) does not state this explicitly in the Rule, but relegates it to Comment [6]. The Task Force recommended making this point explicit in the Rule itself and discussed the following example: Lawyer X is representing Client A in connection with the adoption of a child. Client B desires to engage Lawyer X in connection with a real estate sale in which Client A is the buyer. In such a circumstance, Lawyer X's concurrent representation of Client B would be directly adverse to Lawyer X's representation of Client A in the real estate transaction. Where representation of one client is directly adverse to the concurrent representation of another client, even if the representation involves wholly unrelated matters, a conflict-of-interest exists. The Task Force recognized the issue of conflicts of interest must be viewed from the perspective of the client as well as of the lawyer. The duty of loyalty requires the lawyer obtain the client's consent before being directly adverse to the client. In the vast majority of cases, where a lawyer determines a conflict is consentable, i.e., the lawyer has a reasonable belief that the quality of the representation would not be compromised by the conflict, the affected clients are likely to consent to the representation. Unlike M. Bar R. 3.4(b), Rule 1.7 addresses only conflicts of interest with respect to current clients. Conflicts of interest with respect to former clients are addressed in Model Rule 1.9 (2002). The Task Force acknowledged the issue of when a client is a current client and when a client is a former client is not always clear in practice. It is an issue, however, that can be addressed through plain language in attorney engagement letters, clearly defining both the scope and duration of a lawyer's engagement. There are, however, certain circumstances where concurrent representation of two (or more) clients is categorically prohibited. This is the case, (i) when the representation is prohibited by law, and (ii) when two (or more) clients are asserting claims against each other in the same proceeding. The Task Force recommended dividing Rule 1.7(b) into Rule 1.7(b) and (c) to make that point clearly and explicitly. This structural modification of the Model Rule does not represent a substantive departure from either M. Bar R. 3.4 or from Model Rule 1.7(b) (2002).
The Task Force also recognized that under M. Bar R. 3.4(c)(2)(i)(A) and (B), a lawyer engaged in a simultaneous representation that presents a conflict must reasonably believe that each affected client "will be able to make adequately informed decisions, and consult with each client concerning the decisions to be made and the considerations relevant in making them." Although these requirements are not stated expressly in Model Rule 1.7(2002), the Task Force believed they are implicit in the Model Rules. An attorney cannot reasonably determine whether he or she can provide diligent and competent representation if it is not possible for an affected client to make adequately informed decisions. A concurrent representation does not relieve a lawyer of his or her obligations under Maine Rules of Professional Conduct Rule 1.4 to consult with clients and keep them adequately informed so that they can make informed decisions.
Under the Maine Bar Rules, a lawyer engaged in concurrent representation presenting a conflict must terminate representation if any of the conditions that made it permissible to undertake the concurrent representation cease to exist. The Task Force was satisfied these issues are adequately addressed in Comments [4] and [5].
Comment [11] to Model Rule 1.7 is substantially the same as existing M. Bar R. 3.4(f)(3), addressing the issue of familial relations between lawyers in the same or substantially related matters. The Task Force recommended adding a new Rule 1.8(l) setting forth the substance of M. Bar R. 3.4(f)(3).
With respect to advance waivers of conflicts of interest, the Task Force was in accord with the approach taken by Model Rule 1.7 Comment [22] (2002). Comment [22], in setting forth various factors to consider in evaluating the validity of such an advance waiver, is consistent with what has been both common law and practice in the State of Maine. The Task Force recognized that such advance waivers are a business necessity for many lawyers and law firms, and may be the only way that clients can secure counsel of their choosing. Especially in cases where sophisticated, repeat users of legal services are independently represented by their own in-house lawyers, advance waivers of conflicts of interest ought to be allowed. Notwithstanding the absence of a specific provision addressing this issue in M. Bar R. 3.4, inclusion of interpretive Comment [22] does not represent a substantive departure from the approach historically taken in Maine. The Model Rule (2002) approach is in accord with the Restatement § 122, comment d.
M. Bar R. 3.4(b)(2) lists a number of factors bearing on the determination of whether a client has given "informed consent." The Task Force recommended that the enumeration of factors informing the issue of whether a client has given informed consent set forth in M. Bar R. 3.4(b)(2) be added to Maine Rule of Professional Conduct 1.0(e) definition of "informed consent." The Rule 1.0(e) definition of "informed consent" is cross-referenced in Comment [18] to Rule 1.7.
The Task Force discussed the difficulties that may face a lawyer who is himself or herself being represented in a legal matter, and who may face his or her own lawyer in unrelated matters as opposing counsel. For example Lawyer A represents Smith against Jones, who is represented by Lawyer B. At the same time, Lawyer B is representing Lawyer A in a personal affair of Lawyer A's. Lawyer A's client relationship to Lawyer B is a personal relationship of Lawyer A. In the appropriate case, the Task Force advises it would be prudent for Lawyer A to disclose to Smith that personal relationship, including that Lawyer B represents him on an unrelated personal matter.
With respect to the issue of the form of informed consent required, the Task Force recognized three potential options: (i) verbal informed consent, (ii) informed consent, confirmed in writing by the lawyer (which does not need to be written or signed by the client), and (iii) informed consent in writing, signed by the client. Under the Model Rules (2002), the default rule for informed consent to a concurrent conflict-of-interest is to obtain consent from the client, confirmed in writing. In contrast, the Maine Bar Rules do not require a writing. Because it is in the best interest of both clients and lawyers to memorialize the specifics of the consent, the Task Force recommended the adoption of the Model Rule 1.7 (2002) requirement that clients' informed consent be confirmed in writing.
Comment [24] addresses the issue of positional (or issue) conflicts of interest. When a lawyer advocates a resolution of particular legal issue in one way for one client, and advocates the opposite resolution of the same issue for another client in an unrelated matter, this is referred to as a "positional" or an "issue" conflict. The Task Force recognized that the treatment of such situations has been the subject of much debate; the ABA, the Restatement 3rd, and Board of Overseers' Professional Ethics Commission all have spoken to this issue, not entirely consistently.
Under the Maine Rules of Professional Responsibility, an issue conflict is not a per seconflict-of-interest under Rule 3.4; the only Rule bearing on an issue conflict is the lawyer's duty under Rule 3.6 to employ "reasonable care and skill" and "the lawyer's best judgment" in representing clients and to determine whether the issue conflict (so-called) requires the lawyer to withdraw. In so ruling, the Board of Overseers' Professional Ethics Commission expressly declined to adopt the reasoning of the ABA. The ABA has analyzed issue conflicts as conflicts under Rule 1.7(b), and set forth factors that counsel should consider in determining whether the conflict is consentable or not (i.e. whether the representation of one client would be adversely affected). In other words, an issue conflict by itself is not representation of "directly adverse" clients (under Rule 1.7(a) ); it is a potentially consentable conflict, assuming the lawyer reasonably believes that one representation will not be adversely affected by the other. The ABA interpretation was based on the text of Rule 1.7 and the comments thereto as they existed at that time. The subsequent revisions to Rule 1.7 (2002), as well as the Restatement 3rd, follow the same general approach addressing issue conflicts in general as consentable conflicts, but they revised the discussion of the factors to be considered in making the consentability determination, and made clear that an "issue conflict" is not a conflict at all unless one representation presents a significant risk of materially impairing another representation.
The Task Force concluded that interpretations of the Maine Bar Rules and interpretations of the ABA rules are not very far apart. The common concern is the risk of materially impairing the lawyer's effectiveness in representing one client in light of the positions that the lawyer is advocating for another client: contemporaneously arguing opposite sides of the same issue before the same judge or panel of judges has the potential to impair his or her effectiveness on behalf of both clients. In Maine, however, the principal concern seemed to be that treating issue conflicts as true conflicts would require attorneys to engage in conflict screening not simply as to the identity of clients, but as to the substance of legal arguments advanced on behalf of clients: a considerable burden. A related but unstated consequence of the Maine Professional Ethics Commission's ruling is issue conflicts are not something that need to be disclosed to or consented to by a client. Either they actually do materially impair the lawyer's effectiveness, in which case the lawyer must withdraw; or they do not, in which case the representation continues. The lawyer decides whether the impairment is actual or not, and there is no need to disclose or get consent to the mere potential of adverse impact.
The Task Force decided to adopt the approach taken under the Model Rules (2002): issue conflicts may be conflicts in some circumstances; and a multifactored analysis is necessary to determine whether an issue conflict can be waived by the client.
An issue conflict can, under certain circumstances, ripen into a true, albeit consentable, conflict-of-interest, but an issue conflict is not necessarily a conflict-of-interest in all cases. The Task Force was mindful fact that to the extent that issue conflicts are conflicts, they have not historically been the subject of a screening requirement in Maine. The adoption of this rule does not make them the subject of screening but simply recognizes that when a lawyer is aware of the existence of such an issue conflict, the lawyer must go through the paragraph 1.7(b) analysis to determine whether the 'conflict' presents a risk to the representation that is significant enough to constitute a true conflict; if so, whether the risk is insubstantial enough that the conflict, though real, is curable; and if so, that the lawyer make the necessary disclosure and obtain the necessary consent.
The Task Force recognized the sensitive issues raised by Model Rule 1.7 Comment [10] (2002) and Model Rule 1.8(j) (2002), categorically prohibiting of sexual relationships with clients. The Model Rules (2002) categorical prohibition does not exist in the Maine Bar Rules. Model Rule 1.8(j) (2002) bars forming a sexual relationship with a client (but does not prohibit forming a client relationship with an existing sexual partner) (and that prohibition is recognized as a conflict-of-interest in Comment [10] to Model Rule 1.7 (2002)). Comment [19] to Model Rule 1.8 (2002) notes that the prohibition applies in the context of organizational clients as well, prohibiting a sexual relationship "with a constituent of the organization who supervises, directs or regularly consults with that lawyer concerning the organization's legal matters."
Three principal rationales for the prohibition found in Model Rule 1.8(j) (2002) are put forward: impairment of the lawyer's professional detachment, risk to ability to protect client confidences, and possible sexual exploitation of the client by the lawyer. See Comment [17] to Model Rule 1.8 (2002). The first two rationales apply with equal force regardless of whether the sexual relationship pre-dates or post-dates the formation of the client relationship. The Rule, however, does permit a sexual relationship with the client as long as the sexual relationship predated the client relationship. The rationale that appears to motivate the rule as written is the rationale based on inequality in the relationship and the possibility of sexual exploitation of the client by the lawyer-or an unstated moral judgment that neither has, nor necessarily needs, further support (i.e., "it's just plain wrong").
The Task Force ultimately recommended (albeit with some dissent) that Maine not adopt the Model Rule (2002). A minority of members of the Task Force thought that the Model Rule 1.7 Comment [10] (2002) and Model Rule 1.8(j) (2002) should be adopted in Maine. The minority members expressed the concern that a failure to adopt a categorical prohibition against sexual relations with clients would tarnish the image of the legal profession in the eyes of the public. Furthermore, the Model Rule (2002) formulation, in setting forth a bright line rule, was more functional and gave attorneys clear guidance as to what was and was not prohibited conduct.
In the view of the majority of Task Force members, the rule is unnecessary to address the true disciplinary problems needing to be addressed. Moreover, it threatens to make disciplinary issues out of conduct that should not be a matter of attorney discipline. For example, if a junior associate were to become romantically involved with a corporate officer with whom he regularly consulted on a corporate client's title matters, for instance, the Rule would make that professional misconduct, subjecting that associate as well as his supervising partner(s) to potential professional discipline. It was the view of a majority of the Task Force that the problem of client exploitation can be addressed without Model Rule 1.8(j) (2002). Moreover, private moral judgment is not an appropriate basis for a rule of discipline. The Task Force was clear that this position does not condone sexual relationships that involve exploitation. They have been, and remain inappropriate.
The Task Force recognized even without a categorical prohibition, the Board of Overseers has, when appropriate, been able to discipline lawyers for inappropriate sexual relationships with clients. Sexual relationships involving exploitation of the client or impairment of the representation of the client have always been prohibited. Accordingly, the Task Force concluded that Model Rule 1.8(j) (2002) and its related Comments are well-intentioned, but poorly thought-out, attempts to address the core problem of sexual exploitation.