ETHICS COMMITTEE OPINION NO. 19-01
THIS OPINION IS ADVISORY ONLY
FACTS
A firm represents an enterprise with a diverse operation and is a
governmental entity (government client). The firm currently provides
services to the government client in two distinct areas of the law
which are unrelated to the other. The attorney at issue (attorney) is
employed at the firm. The attorney does not currently represent the
government client in any matter. The attorney has not represented
the government client in any matter in the past. Only the attorney’s
colleagues in the firm have represented the government client.
The firm also represents another client (private client) concerning
a business. The firm’s services to the private client are unrelated to
the firm’s representation of the government client. The attorney has
primarily represented the private client. Although other counsel
within the firm have provided services to the private client, none of
the other counsel are currently providing services for the government
client.
The government client served a subpoena on the private client
indicating that the government client (a governmental entity) is
investigating whether the private client have committed unlawful
conduct including construction fraud (investigation). The firm is
not providing any services to the government client regarding the
investigation.
The private client has asked the attorney to represent the private
client regarding the investigation. After consultation, both the
government client and the private client have consented to the firm’s
representation of the private client regarding the investigation.
QUESTIONS PRESENTED
Under the North Dakota Rules of Professional Conduct, according
to Rule 1.7:
1. Does Rule 1.7 of the North Dakota Rules of Professional
Conduct permit the firm to represent the private client in the
investigation?
2. If the firm believes the representation will not be adversely
affected, is the firm’s belief “reasonable” as required by
N.D.R.Prof.Conduct 1.7(c)(1)?
OPINION
I. APPLICABLE NORTH DAKOTA RULES OF
PROFESSIONAL CONDUCT
North Dakota Rules of Professional Conduct, Rule 1.7 is most
applicable in this case.
30
THE GAVEL
The Rule states in pertinent part:
a. A lawyer shall not represent a client if the lawyer's ability to
consider, recommend, or carry out a course of action on behalf of
the client will be adversely affected by the lawyer's responsibilities
to another client or to a third person, or by the lawyer's own
interests.
b. …
c. A lawyer shall not represent a client if the representation of that
client might be adversely affected by the lawyer's responsibilities
to another client or to a third person, or by the lawyer's own
interests, unless:
1. the lawyer reasonably believes the representation will not be
adversely affected; and
2. the client consents after consultation.
II. DISCUSSION
Subsection (a) addresses the situation where a lawyer’s responsibilities
to another client will adversely affect the lawyer’s representation of a
client. N.D.R. Prof. Conduct 1.7, Comment 2. Subsection (c), on the
other hand, addresses the situation where a lawyer’s responsibilities
to another client may adversely affect the lawyer’s representation of a
client. Id. Under subsection (c), the lawyer may cure the conflict if the
lawyer reasonably believes there will not be an adverse effect and the
client consents. In this circumstance, subsection (c) applies because
there is no concrete evidence that the attorney’s representation of the
private client will adversely affect the government client.
“Ordinarily, a lawyer may not act as an advocate against a client the
lawyer represents in some other matter, even if the other matter
is wholly unrelated. However, there are circumstances in which a
lawyer may act as an advocate against a client. For example, 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 after consultation.” N.D.R. Prof. Conduct 1.7, Comment
9 (emphasis added). However, concurrent representation of this
nature can depend on the nature of the litigation. Id. Specifically, “a
suit charging fraud entails conflict to a degree not involved in a suit
for a declaratory judgment concerning statutory interpretation.” Id.
(emphasis added).
On its face, “charging” fraud could be construed differently than
“defending.” In this case, the attorney would be defending the
fraud allegation. However, the comment references “conduct of the
suit,” but does not state either charging or defending and does not
distinguish between the two. Because of that lack of distinction, it is
possible that the phrase “a suit charging fraud” is making a general
statement about what type of suit it is, as opposed to which side of
the suit an attorney is on.