Legal Ethics

NEW 2016 Sixth Edition of Minnesota Legal Ethics is now published.  Commentary—updated through the end of 2015, with some updates from early 2016 – on all the rules of professional conduct.

In 2013, Larry, a solo transactional lawyer, assisted Beyer in purchasing a business from Stella. In 2016, Beyer stops payments to Stella, alleging breach of warranties. Stella sues Beyer. Beyer retains Amy, a litigator. Stella’s counsel, Stanley, serves a subpoena on Larry, for production of his file for Beyer and for his deposition. The subpoena informs Larry of his right to arrangements for payment of his time and expenses to be made before Larry begins compliance. What should Larry do?

Larry should read Rule 45, R. Civ. Proc., “Subpoena.” Larry should also consider consulting his malpractice carrier to learn whether they provide help and whether being served with a subpoena is a reportable event. Larry should also ask Amy if, with Beyer’s authorization, she will instruct Larry, regarding claims of privilege or other grounds for not producing portions of the file, and will represent Larry at deposition and in any motion hearings. Most subpoena responses, including that for G.D. Beyer, can be handled in this fashion. Amy may even arrange with Stanley that Amy can take possession of the file and handle the matter without Larry’s involvement.

Let’s change the facts. The client now is Evil Twin Beyer. When Larry represented him, E.T. did not pay fees, and threatened Larry with both a malpractice suit and physical harm. E.T. is not represented by counsel in Stella’s suit. Now Larry has difficult issues to consider. As a humble transactional lawyer with no expertise in these matters, Larry may wish to retain his own counsel who has the expertise and the stomach for dealing with E.T.

If Larry does not retain counsel, he should brush up on two confidentiality doctrines—attorney-client privilege and Rule 1.6(a), Minn. R. Prof. Conduct (“MRPC”). Another confidentiality doctrine—work product protection—will not apply, because Larry’s work product was not created in anticipation of litigation.

Privilege and the ethics duty of confidentiality differ in important ways. Privileged materials consist of communications between privileged persons, seeking or giving legal advice, which are meant to be confidential and which, at the option of the client, may be kept from discovery. Confidentiality includes privileged communications and also other information which a lawyer may not divulge without client consent, court order, or some other specified exception.

Confidentiality’s coverage of documents and information is considerably broader than that of privilege. Rule 1.6(a) requires Larry to keep confidential “information relating to the representation” of Beyer. However, Rule 1.6(b) provides ten exceptions. The largest disclosure permission is for information that is not privileged and that is not apt to embarrass or harm the client. However, this permission is trumped where the client requests all information be held inviolate.

The client’s blanket confidentiality request itself may be trumped where a disclosure mandate applies, such as disclosure required by law, “A lawyer may reveal information relating to the representation of a client to the extent the lawyer reasonably believes necessary to comply with other law or court order.” 1.6(b)(9). The “may” of this rule becomes “shall” where the law relating to subpoenas and discovery, or a court order, requires disclosure. Rule 3.4 (c) forbids knowingly disobeying a court rule, including rules pertaining to discovery and subpoenas.

Let’s change one important fact. After Amy reports that E.T. has fired her, Larry tries to contact E.T. E.T. will not respond. What should Larry do? Larry’s duty not to disclose confidential information and privileged information is clear in principle, but it is not clear how far that duty extends. The Office of Lawyers Professional Responsibility (OLPR) and the ABA provide advice that is generally helpful, but in each case has a serious flaw.

OLPR has advised, “[A] lawyer may take the cautious approach and decline to disclose any information. If subpoenaed to a deposition or a hearing, the attorney could assert the attorney-client privilege or the ethical obligation in response to all questions seeking such information …” Martin A. Cole, The Self-Defense Exception to Client Confidentiality, Minn. Law., Apr. 1, 2002, at 2, 25 (emphasis added).

OLPR’s advice is mistaken and far from cautious. The subpoena is a court “command” under Rule 45. Only arguably valid legal objections may be asserted. The Rule 1.6 duty of confidentiality is not a right that can be asserted to protect non-privileged information from a subpoena. U.S. v. Sindel, 53 F.3d 874 (8th Cir. 1995). As another authority states, “A lawyer’s general legal duty not to use or disclose confidential client information is superseded when the law specifically requires such use or disclosure.” Restatement (Third) of the Law Governing Lawyers § 63 cmt. a.

Although Rule 1.6 itself is not a basis for objection to a subpoena, related policy considerations sometimes may be used to protect some information. Where disclosure of even non-privileged information would be embarrassing or harmful, seeking a protective order could be considered, on grounds of “undue burden.” Rule 45.03, R. Civ. Proc.

A new ABA Formal Opinion (473), issued in February 2016, takes a less extreme position than OLPR’s. Op. 473 recognizes that a lawyer is bound, under the Rule 1.6 duty of confidentiality, to assert only “reasonable” claims and seek only “appropriate” protections against disclosure. If the lawyer’s positions are rejected by a trial court, the lawyer is not required to appeal. Op. 473 also recognizes the lawyer is bound under the civil law pertaining to subpoenas.

Let’s change the facts again. E.T. belatedly responds to Larry’s notice of the subpoena. E.T. says he will meet with Larry but not pay any fees. E.T. reminds Larry of Larry’s purported malpractice. Larry would like to just give E.T. the file and let E.T. handle it, but E.T. might alter or destroy the file and Larry could suffer the consequences.

How should Larry deal with E.T.? ABA Op. 473 gives Larry what could be disastrous advice, “The lawyer’s obligations of notice and consultation upon receiving a demand for client files and information are essentially the same for current and former clients.” The opinion continues, “the lawyer must consult the client about how to respond to the demand.” To “consult” is to communicate, “information reasonably sufficient to permit the client to appreciate the significance of the matter in question.” Rule 1.0(c) (emphasis added). Opinion 473 would require Larry’s “consultation” with E.T. to cover, “at a minimum,” Rule 1.6, and “whether and to what extent the attorney- client privilege or work product doctrine or other protections or immunities apply,” and “any other relevant matter,” e.g. any criminal exposure. The Opinion regards a former client, like E.T., as someone whom Larry must reinstate as a current client, by “consulting” regarding the subpoena. This advice may work for dealing with G.D., but not with E.T..

Opinion 473 does not answer two important questions. First, what authority requires Larry to “consult” and thereby reinstate E.T. as a current client? This question should be asked even if E.T. was not a repugnant former client. The lawyer in possession of the former client’s file is duty-bound to follow the client’s instructions for file production or protection, when those instructions are reasonable and do not violate the law. But a lawyer is free to decline any representation, including a new representation, of a former client.

Opinion 473 repeatedly cites Rule 1.6, MRPC. Rule 1.6 provides that “a lawyer shall not knowingly reveal” certain client information, and “a lawyer may reveal” other information. However, the rule contains no “shall.” In particular, Rule 1.6 does not include any “shall consult” or “shall represent.” True, a lawyer “may reveal” information if “the client gives informed consent.” Rule 1.6(b)(1). However, this rule assumes rather than creates an attorney-client relationship.

Second, Larry, a transactional lawyer, does not know the law of privilege, work product, criminal exposures, etc. Larry has never appeared in court and might not competently assert the protections that may be available to E.T. Must Larry acquire expertise to perform the “minimum” consultation Op. 473 would require? If the sale was extremely complicated and there are 10,000 pages of related documents, must Larry review and “consult” with E.T. on the whole file?

There is general agreement on some issues. A lawyer should take disclosure and non-disclosure instructions from a client or former client, insofar as they are reasonable and do not violate the law. Where the client or former client is unavailable, a lawyer must take reasonable steps so as not to reveal information that is protected by law, such as privileged information and documents. ABA Op. 473 states, however, that where the client or former client is available, but will not pay a lawyer’s fee, the lawyer is not required to “act” (although the opinion appears to regard consultation as required even where fees will not be paid).

Op. 473’s parallel treatment of clients and former clients is unwise and unfounded. The duty to protect certain client information does not entail a duty to “consult” a former client, and thereby reinstate an attorney-client relationship, especially where the relationship is repugnant or apt to be harmful to Larry. Larry must inform E.T. of the subpoena. Larry may also inform E.T. that he will not represent or consult with E.T., and that E.T. should retain counsel. Larry may also state that he will follow reasonable instructions that do not require him to violate the law.

In taking these positions, Larry is a party and is also a lawyer who is subject to legal obligations imposed by a subpoena. Larry may also be acting at E.T.’s direction, but following directions by itself does not create or reinstate an attorney-client relationship. And again, Larry may wish to retain his own counsel.