YourABA: March 2013
YourABA April 2013 Masthead

Understanding the key elements
of a conflict waiver

In an American Bar Association Sound Advice podcast, Mike Downey, a litigation partner at Armstrong Teasdale in St. Louis, discussed the three most important elements of a conflict waiver.

There are two types of risk. The first is what Downey calls the “zealousness factor.”

The first element requires the lawyer to explain the circumstances that give rise to the conflict, says Downey, who is also an ethics professor at Washington University School of Law and St. Louis University School of Law, both in St. Louis. “For example, if you’re going to file a lawsuit on behalf of one client and you previously have done work for the defendant in the case, you may have confidential information for that defendant that you would not be able to disclose or use because of Rule 1.9,” he says.

The second element of the conflict waiver is to talk about what the risks of the conflict are, Downey says. There are two types of risk. The first is what Downey calls the “zealousness factor.”

“Is there some reason that you may not make the same arguments, pursue the claims as vigorously, make decisions because of the relationship you have with the other party or with the source of the conflict?” he asks. “So, for example, if we go back and talk about that situation where you are now representing a plaintiff and you previously represented the defendant, you might say, ‘Well, there’s a possibility that because I had a pretty good relationship with them, I wouldn’t sue them. I wouldn’t pursue them as vigorously. I may not seek punitive damages against them.’ If those are the types of things that you’re thinking may affect things, you need to go ahead and describe what those are.”

The second set of risks of that usually arises relates to information, Downey says. Typically a lawyer is not able to share information he or she learns in representing one client with another client, nor may the lawyer use that information to benefit the other client or for the lawyer’s own benefit. “If we go back to the situation where you’re now representing a plaintiff who’s suing a former client, there may be confidential information that you have learned that you wouldn’t be able to use or disclose,” he says. “In addition, it may be difficult for you to form your questions about things without getting into the [confidential information] that you learned.”

An example would be a lawyer who represented a doctor in a licensure proceeding who had a substance abuse problem, Downey says. “Now your client is going to be suing that doctor, and you would say, well, typically I’d ask them, have you ever been arrested? Have you ever used illegal drugs? Now I’m not really comfortable asking those questions because I know the answers to those questions, and the answers, in fact, would be harmful to my former client,” he says. “Obviously, you can’t say to your new client, ‘Well, I don’t want to ask them questions about their arrest record because I know they’ve been arrested,’ but you would want to say, ‘I may have learned information during that prior representation that I can’t get into. It could relate to things that may be material to your case.’”

The third issue that needs to be covered in the conflict waiver is the alternatives to the conflicted representation. This means looking at whether there is something that can be done to lessen the threat of the conflict or remove it, Downey says. “Typically what I tell lawyers when you are discussing with someone a conflict, it is important to actually say to them, ‘Remember, you can hire some other lawyer to do this work. You don’t have to hire me,’” he says. “First of all, clients appreciate that candor, and second of all, it allows you to make sure that you’ve given them the ultimate alternative, which is that they use a nonconflicted lawyer.”

Still, think through other alternatives, Downey says. “Suppose that you’re going to represent a husband and wife in a case, and you tell them ‘Because I’m representing the two of you, there may be a conflict of interest,’” he says. “‘Although obviously you’re happily married and there are no issues now, you may, for example, have one of you want to tell me information that you may not want the other one to know. That would be information that typically under a joint representation I’m going to need to share.’

Having set out the elements of a conflict, it’s important to next consider whether you need to put anything in writing, Downey says.

“Then you could talk about some alternatives. You could agree, for example, that I am not required to share information between [husband and wife] unless you give me authorization.”

Having set out the elements of a conflict, it’s important to next consider whether you need to put anything in writing, Downey says. “The rules in most jurisdictions have been changed that for a normal conflict of interest, you need to get confirmation in writing,” he says. “What this means is that there needs to be some sort of document — and the rules even permit you to send an email, it can be a letter — that simply says, this is to confirm that we’ve discussed the conflict, I’ve discussed with you the risks involved, the alternatives that you have, and you understand things and agree to waive that.”

Do you need the document signed? The typical rule for most jurisdictions is that you don’t need a client’s signature, Downey says. “Most of the time, if you send that email, even if you don’t get a response, under the rules, it’s going to be sufficient,” he says. “That said, people who are active in law firm risk management like I am really like to see some sort of confirmation back from the client: a signature or an email back saying, yes, I agree to waive it. If you don’t get that, there’s the danger later that they’ll say, ‘I didn’t get your email. I didn’t look at it, I didn’t read it, I didn’t understand it.’ So you have to be very careful there.”

When you need a written waiver, does it need to be detailed? The answer comes down to the circumstances, Downey says. “If you’re representing a huge company that has a very complex, sophisticated in-house counsel department and it’s something of a run-of-the-mill conflict, you may say, ‘you know what, we don’t need to put a lot of detail in there,’” he says. “If, however, it’s a situation where you have a less sophisticated client or a more substantive conflict, it is certainly worth considering whether you want to take greater steps to make sure you’ve documented the conflict waiver.”

In those circumstances, you really want to be explicit. “When I prepare a conflict waiver, I use the subheadings of ‘circumstances giving rise to the conflict,’ ‘risks from the conflict’ and ‘alternatives to the conflicted relationship,’” he says. “That way if someone were ever to look at the conflict waiver, you’d be able to set things out and say, here’s how I covered what I was required to cover under Rule 1.0(e) in order to try to obtain informed consent.”

Sound Advice is sponsored by the Section of Litigation.

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