Ethics 2000

Proposed Introduction and Summary of Changes

On behalf of the Ethics 2000 Commission, I respectfully present to the House of Delegates, to the legal community and to the public, our Report on the Evaluation of the Model Rules of Professional Conduct. I do so proudly and humbly. I am proud of this Commission and its herculean effort to produce this Report in a timely manner. I am humbled by the daunting task of reconciling the many diverse views presented to us along the way.

We began this journey in mid-1997 by virtue of the vision and action of then-incumbent ABA President Jerome J. Shestack, his immediate predecessor, N. Lee Cooper, and his successor, Philip S. Anderson. These three leaders persuaded the ABA Board of Governors that the Model Rules adopted by the ABA House of Delegates in 1983 needed comprehensive review and some revision, and this project was launched. Though some might have thought it premature to reopen the Model Rules to such a thoroughgoing general reassessment after only 14 years, the evaluation process has proved that the ABA leadership in 1997 was right on target.

One of the primary reasons behind the decision to revisit the Model Rules was the growing disparity in state ethics codes. While a large majority of states and the District of Columbia had adopted some version of the Model Rules (then 39, now 42), there were many significant differences among the state versions that resulted in an undesirable lack of uniformity - a problem that had been exacerbated by the approximately 30 amendments to the Model Rules between 1983 and 1997. A few states had elected to retain some version of the 1969 Model Code of Professional Responsibility, and California remained committed to an entirely separate system of lawyer regulation.

But it was not only the patchwork pattern of state regulation that motivated the ABA leaders of 1997 to take this action. They were also concerned about some substantive shortcomings and lack of clarity in particular Rules, both exemplified and aggravated by dissonance between Rule text and Comment. These shortcomings were underscored by the work then underway on the American Law Institute’s Restatement of the Law Governing Lawyers. There were also new issues and questions raised by the influence that technological developments are having on the delivery of legal services. The explosive dynamics of modern law practice and the anticipated developments in the future of the legal profession lent a sense of urgency as well as a substantive dimension to the project.

Yet with all these perceived shortcomings of the Model Rules, there was also a strong countervailing sense that there was much to be valued in their concepts and articulation. The Commission concluded early on that these valuable aspects of the Rules should not be lost or put at risk in our revision effort. As a result, the Commission set about to be comprehensive, but at the same time conservative, and to recommend change only where necessary. In balancing the need to preserve the good with the need for improvement, we were mindful of Thomas Jefferson's words of nearly 185 years ago, in a letter concerning the Virginia Constitution, that "moderate imperfections had better be borne with; because, when once known, we accommodate ourselves to them, and find practical means of correcting their ill effects."

Thus, we have retained the basic architecture of the Model Rules. We have also retained the primary disciplinary function of the Rules, resisting the temptation to preach aspirationally about "best practices" or professionalism concepts. Valuable as the profession might find such guidance, it would not have - and should not be misperceived as having - a regulatory dimension. We were however, always conscious of the educational role of the Model Rules. Finally, we tried to keep our changes to a minimum: when a particular provision was found not to be "broken" we did not try to "fix" it. Even so, as the reader will note, the Commission ended up making a large number of changes: some are relatively innocuous and nonsubstantive, in the nature of editorial or stylistic changes; some are substantive but not particularly controversial; and a few are both substantive and controversial.

How is it that these changes were deemed necessary? In the end, of course, it was by majority vote of the 13 members of the Commission. But those votes did not take place in a vacuum, and our determinations are not being pronounced ex cathedra. Rather, they are products of thorough research, scholarly analysis and thoughtful consideration. Of equal importance, they have been influenced by the views of practitioners, scholars, other members of the legal profession and the public. All these constituencies have had continual access to and considerable - and proper - influence upon the deliberations of the Commission during its extraordinarily open process from the beginning of its work over three years ago to the present.

I must pause to underscore the openness of our process. We have had 39 days of meetings, all of which were open, and eight public hearings at regular intervals over this period of nearly 40 months. There have been a large number of interested observers at our meetings, many of whom were from the ranks of our Advisory Council of 250-plus persons, to offer comments and suggestions. Those observations have been very helpful and influential in shaping the Report. Our public discussion drafts and minutes have been available on our website ( www.abanet.org/cpr/e2k/home.html) for the world to see and comment upon. As a consequence, we have received an enormous number of excellent comments and suggestions, many of which have been adopted in the formulation of this Report.

Moreover, we have encouraged state and local bar associations, ABA Sections and Divisions, other professional groups and the judiciary to appoint specially designated committees to work with and counsel the Commission. This effort has been successful, and the Commission has benefitted enormously from the considered views of these groups. We fully expect more interaction of this nature as we progress toward consideration by the ABA House of Delegates of this Report and any amendments that may be in the offing.

In heeding the counsel of these advisors, we have been constantly mindful of enormous and high-velocity changes in the profession, particularly over the past decade. These changes have been highlighted by increased public scrutiny of lawyers and an awareness of their influential role in the formation and implementation of public policy; persistent concerns about lawyer honesty, candor and civility; external competitive and technological pressures on the legal profession; internal pressures on law-firm organization and management raised by sheer size, as well as specialization and lawyer mobility; jurisdictional and governance issues such as multidisciplinary and multijurisdictional practice; special concerns of lawyers in nontraditional practice settings, such as government lawyers and in-house counsel; and the need to enhance public trust and confidence in the legal profession.

At the end of the day, our goal has been to develop a set of Rules that make sense to the public and provide clear guidance to the practitioner. Our desire was to preserve all that is valuable and enduring about the existing Model Rules, while at the same time adapting them to the realities of modern law practice and the limits of professional discipline. We believe our product is a balanced blend of traditional precepts and forward-looking provisions that are responsive to modern developments. Our process has been thorough, painstaking, open, scholarly, objective and collegial. But the journey we have undertaken over the past three-plus years to produce this Report has not been without controversy or respectful division within our ranks. Indeed, this would be a very sterile document if every vote in the Commission’s deliberations had been unanimous. As Walter Lippmann, the great American writer and editor said, "Where all think alike, no one thinks very much."

The Commission recognizes that this Report represents only our view - by majority vote on a rule-by-rule basis - of what provisions to retain and what changes to make in the Model Rules for the future. We expect vigorous discussion over the coming months. The Commission will listen and consider all views. When the House of Delegates has finally concluded its work on Model Rule revisions and the state supreme courts or other state authorities consider implementation, it is our fervent hope that the goal of uniformity will be the guiding beacon.

The Report includes a "clean copy" of the proposed revision of each Model Rule and Comment, as well as a blacklined copy of the text of each Rule and Comment so that the reader may readily see each change or retention of the provisions of the current Model Rules. We also provide, after each blacklined copy, a Reporter’s Explanation of Changes. For reference to other materials documenting the Commission’s work, including minutes of its open meetings and testimony from its hearings, the reader is invited to visit our website, which we trust the reader will find to be informative. Readers may also find helpful the comprehensive summary of the Commission’s work prepared by Commissioner Margaret Love, also available on our website.

What follows is a brief description of the most significant recommendations proposed by the Commission.

1. Communication with Clients, Informed Consent, Allocation of Authority

One recurring theme throughout this Report is an insistence on clear communication between lawyer and client. The lawyer’s obligation to consult with the client is emphasized in Rule 1.4 ("Communication"), and given effect in rules requiring that client consent must be "informed." As defined in a new Rule 1.0 on terminology, "informed consent" means agreement "after the lawyer has communicated adequate information and explanation about the material risks of and reasonably available alternatives to the proposed course of conduct." The Commission also proposes to require that client consent be confirmed in writing in many cases, notably in connection with conflict waivers under Rules 1.7 (current client) and 1.9 (former client). Ordinarily the requirement of a writing may be satisfied by a letter from the lawyer to the client, though in a few cases the rules require the client’s signature. (The four rules that require a client actually to sign a consent are Rule 1.5(c) on contingent fees, Rule 1.5(e) on fee-splitting agreements, Rule 1.8(a) on business transactions with clients, and Rule 1.8(g) on aggregate settlements.)

The Commission also proposes in Rule 1.5 ("Fees") to require a lawyer to communicate the scope of representation and fee and expense arrangements to a client in writing at the commencement of the representation, except where the lawyer will charge a "regularly represented" client at the same rate. Fees for referrals will be permitted without requiring division of work or "joint responsibility" for the representation, as long as the total fee is reasonable and the client agrees in a signed writing to the participation of all lawyers involved, including the share of the fee each lawyer will receive

The allocation of responsibility between lawyer and client is explicated in amendments to Rule 1.2 ("Scope of Representation and Allocation of Authority Between Client and Lawyer"). This provision retains the present authority of the client to decide objectives of the representation. The Commission decided to leave the resolution of disagreements with clients about means to be resolved by the law of agency, the right of the client to discharge the lawyer, and the right of the lawyer to withdraw from the representation pursuant to Rule 1.16 ("Declining or Terminating Representation") if the lawyer has a "fundamental disagreement" with the client. A new sentence confirms that "a lawyer may take such action on behalf of the client as is impliedly authorized to carry out the representation."

Special issues of communication are presented where a client’s capacity is diminished by reasons such as minority or mental disability. Amendments to Rule 1.14 (retitled "Client With Diminished Capacity") provide that where the lawyer believes that a client with diminished capacity is at risk of physical, financial or other harm unless action is taken, the lawyer may take necessary protective action. For example, the lawyer may, in some circumstances, seek appointment of a guardian, and may be impliedly authorized under Rule 1.6 ("Confidentiality of Information") to reveal information relating to the representation to protect the client’s interests.

2. Confidentiality

There has always been a tension between the goal of keeping inviolate the client’s confidences and the need to give the lawyer the ability to deal with situations where disclosure is necessary to protect third parties or the legal system from substantial harm. The Commission is proposing to broaden, in carefully circumscribed situations, the grounds for discretionary disclosure of client information under Rule 1.6, recognizing that a number of state jurisdictions have already moved in this direction. As amended, Rule 1.6 would permit (though not require) disclosure to prevent death or substantial bodily harm and to prevent or rectify substantial injury resulting from a client's serious abuse of the lawyer's services. It will also explicitly permit a lawyer to disclose confidences to obtain legal advice about the lawyer's compliance with the Rules. Finally, it will permit disclosure where it is required by a law or court order. In light of these substantial changes to Rule 1.6, the Commission has both reorganized and substantially revised the Rule’s Comment.

3. Conflicts

a) Current Clients - The Commission retained the basic substantive concepts relating to conflicts affecting current clients, but completely reorganized Rule 1.7 (retitled "Conflict of Interest: Current Client") and expanded its Comment to give guidance in a number of controversial areas. The revised rule defines clearly what constitutes a conflict of interest, and distinguishes situations where the lawyer may be "directly adverse" to a client from those in which the lawyer’s representation of the client may be "materially limited." As previously noted, client consent to a conflict must be "informed," and must be confirmed in writing. The revised rule clarifies that certain conflicts are "nonconsentable:" e.g., lawyers from the same firm may not represent opposing parties in litigation even if both clients to consent.

The Comment to Rule 1.7 also gives detailed guidance on such unsettled conflicts issues as positional conflicts, conflicts in representation of multiple clients, class action conflicts, corporate family conflicts, close family relationships, and prospective waivers. A lawyer’s obligation to withdraw where a conflict arises after a representation has begun is detailed in several contexts, such as changes in corporate and other organizational affiliation, or the addition or realignment of parties in litigation. Where more than one client is involved, a lawyer may have to terminate both representations and client consent may not be sufficient to permit the lawyer to continue any participation in the matter.

b) Other Conflicts Issues – Former Clients, Government Lawyers, Transactions with Clients, Prospective Clients

No substantive change is being recommended in the text of Rule 1.9 on "Duties to Former Clients", though new commentary clarifies several unsettled issues. For example, a lawyer who has represented multiple clients in a matter may not subsequently represent one client against the others in the same or a substantially related matter, without the consent of all affected clients. The Comment also defines when matters will be deemed "substantially related" for purposes of the rule: "if they involve the same subject matter or if there is otherwise a risk that confidential information as would normally have been obtained in the prior representation would materially advance the client’s position in the current matter."

The conflict of interest obligations of current and former government lawyers are comprehensively covered in an expanded Rule 1.11, which combines for the first time in a single rule a lawyer’s duties when opposing a former client, and the special obligations of a government employee not to abuse the power of public office. Rule 1.11 extends the substantive provisions of Rule 1.9 to cases where the current or former government lawyer is adverse to a former client in the same or a substantially related matter, and also makes clear that lawyers employed by the government are subject to Rule 1.7.

Rule 1.8, which covers specific rules on conflicts of interest with current clients, reformulates and clarifies the rules governing a lawyer’s business transactions with clients. As amended, paragraph (a) of Rule 1.8 would require the lawyer to advise the client in writing of the desirability of seeking independent legal counsel on the transaction, and to obtain the client’s informed written consent to the essential terms of the transaction and the lawyer’s role in it,

including whether the lawyer is representing the client’s interests in the transaction. New commentary explains the risks associated with a lawyer’s dual role as legal adviser and participant in a transaction, pointing out that in some cases the conflict may be such that Rule 1.7 would preclude the lawyer from even seeking the client’s consent to the transaction.

The Commission has also added a new Rule 1.8(j) that would prohibit sexual relations between a lawyer and client, unless a consensual sexual relationship existed at the time the client- lawyer relationship commenced.

A new Rule 1.18 dealing with a lawyer’s duties to a prospective client imposes on the lawyer a duty of confidentiality to a person who discusses the possibility of forming a client-lawyer relationship. In addition, a lawyer will not be permitted, without consent, to represent any clients against such a prospective client in the matter about which the lawyer was consulted (or one substantially related to it), if the lawyer received information during the consultation that could be "significantly harmful" to the prospective client in the matter. Other lawyers in the firm will be permitted to undertake such a representation, however, as long as the personally disqualified lawyer is screened.

4. Imputation of Conflicts—Screening

Conflicts that burden one lawyer are generally imputed by Rule 1.10 to all lawyers associated in a "firm." (The term "firm" as defined in Rule 1.0 may include lawyers sharing office space, depending on the circumstances.) Under the amended Rule 1.10, however, a lawyer’s "personal interest conflicts" would ordinarily not be imputed. The amended rule also permits nonconsensual screening in the case of lawyers moving between firms, except in situations where a moving lawyer had a "substantial role" adverse to a client of the new firm in a proceeding before a tribunal. The personally disqualified lawyer may receive no part of the fee from the representation, and affected clients must be notified. The Commission was ultimately persuaded that non-consensual screening in these cases adequately balances the interests of the former client in confidentiality of information, the interests of current clients in hiring the counsel of their choice (including a law firm that may have represented the client in similar matters for years), and the interests of lawyers in mobility, particularly when they are moving involuntarily because their former law firms have downsized, dissolved or drifted into bankruptcy. The Commission understands that there have been few significant complaints regarding screening in the seven jurisdictions whose rules currently permit it. The elements of an effective screen are set forth in a new provision of Rule 1.0 on Terminology.

Other situations in which the rules will permit unconsented screening are those involving former government lawyers, judges and third party neutrals, lawyers who interview prospective clients, and lawyers who perform "short-term limited legal services" pursuant to new Rule 6.5 ("Non-profit and Court-Annexed Limited Legal-Service Programs"). The conflicts of current government lawyers and a firm’s nonlawyer personnel are ordinarily not imputed, though in both cases personally disqualified individuals "ordinarily" should be screened.

5. Law Firm Management and Discipline

The Commission is proposing that Rules 5.1 ("Responsibilities of a Partner or Supervisory Lawyer") and Rule 5.3 ("Responsibilities Regarding Nonlawyer Assistants") be amended to make clear that the responsibilities imposed by these provisions apply not just to "partners" in a law firm, but to all lawyers with "managerial authority" in a firm (defined in Rule 1.0 to include corporate legal departments, legal services organizations, and law offices within government agencies). In addition, these duties would be extended to law firms as well as individual lawyers. The Comment to Rule 5.1 will elaborate the duty of each responsible lawyer to make reasonable efforts to establish internal policies and procedures designed to provide reasonable assurance that all lawyers in a firm will conform to the Rules, including procedures designed to detect and resolve conflicts of interest, to account for client funds, and to ensure proper supervision of inexperienced lawyers, as well as nonlawyer staff.

6. Multidisciplinary Practice

The Commission recommends no significant change in Model Rule 5.4, which addresses the professional independence of a lawyer and prohibitions on forming partnerships and sharing fees with nonlawyers. This decision is consistent with Resolution 10F adopted by the ABA House of Delegates in July 2000. The Standing Committee on Ethics and Professional Responsibility was designated in that Resolution by the House to consider whether rules should be developed to address strategic alliances and side-by-side partnerships between lawyers and nonlawyers.

7. Multijurisdictional Practice

The complex issues raised by multijurisdictional practice are exemplified by the problem of whether and under what circumstances a lawyer is engaged in the unauthorized practice of law when doing legal work for a client in a state where the lawyer is not licensed to practice. A separate ABA Commission has recently been established to study multijurisdictional practice. In the meantime, however, Ethics 2000 has recommended significant changes in Model Rules 5.5 and 8.5 that recognize the fact that modern legal practice crosses jurisdictional boundaries in a variety of ways.

Proposed amendments to Rule 5.5 identify four "safe harbors" for a lawyer practicing outside the licensing jurisdiction: 1) where the lawyer is preparing for a proceeding in which the lawyer expects to be admitted pro hac vice; 2) where the lawyer is acting on behalf of a client of which the lawyer is an employee, or on behalf of the client’s other employees; 3) where the lawyer is handling a matter that is "reasonably related" to the lawyer’s representation of a client in a jurisdiction in which the lawyer is licensed; and 4) where the lawyer is "associated in a particular matter" with a lawyer admitted in the jurisdiction.

Under proposed amendments to Rule 8.5, a lawyer who "renders or offers to render any legal services" in a jurisdiction where the lawyer is not admitted to practice will be subject to the disciplinary authority and rules (including choice of law rules) of that jurisdiction, as well as the jurisdiction where the lawyer is licensed. In addition, the Commission is proposing a new approach to choice of law where conduct does not take place in connection with a matter before a tribunal, offering an alternative between the rules of the jurisdiction where the conduct occurred or the jurisdiction where the conduct had its predominant effect. A lawyer will not be subject to discipline if the lawyer’s conduct conforms to the rules of a jurisdiction in which the lawyer reasonably believes the predominant effect of the lawyer’s conduct will occur.

8. Pro Bono Service

The Commission discussed at length the question whether to amend Rule 6.1 ("Voluntary Pro Bono Publico Service") to make mandatory a lawyer’s obligation to perform a specified number of hours of pro bono service. After seeking public comment on the issue, the Commission voted to recommend that pro bono service remain voluntary. In order to emphasize that pro bono publico service is a time-honored ethical obligation of all members of the legal profession, the Commission voted to add to the black letter rule a provision now in the Comment stating that "Every lawyer has a professional responsibility to provide legal services to those unable to pay." New commentary will emphasize law firms’ responsibility to enable firm lawyers to meet their pro bono obligations.

9. Limited Legal Service Programs

A new Rule 6.5 ("Non-Profit and Court-Annexed Limited Legal Service Programs") will address the ethical obligations of lawyers providing "short-term limited legal services" to persons of limited means under the auspices of a non-profit or court-annexed legal services program (such as "legal advice hotlines, advice-only clinics, or pro se counseling programs"). In these programs a client-lawyer relationship is established, but the conflict of interest rules are relaxed so as not to discourage firms from permitting their lawyers to volunteer in legal service programs.

10. Third Party Neutrals

The Commission is proposing a new rule on lawyers serving as third-party neutrals in alternative dispute resolution settings. This new Rule 2.4 ("Lawyer Serving as Third-Party Neutral") will require lawyers serving as neutrals to make clear to the parties the nature of their role in the matter. Rule 2.2 ("Intermediary") will be deleted in its entirety. The Commission is also proposing amendments to Rule 1.12 (now "Former Judge or Arbitrator," retitled "Former Judge, Arbitrator, Mediator or Other Third Party Neutral") to extend its conflict of interest provisions to all third party neutrals. This means that former mediators, like former judges and arbitrators, may not represent a client in any matter in which they participated personally and substantially while a mediator, but others in their firm may do so if the former neutral is screened.

11. Obligations to the Tribunal

The Commission proposes to sharpen the lawyer’s responsibilities to a tribunal (defined by Rule 1.0 to include binding arbitration and all entities acting in an adjudicative capacity) and to third parties. Under amendments to Rule 3.1 ("Meritorious Claims and Contentions"), a lawyer’s conduct will be judged by a single objective standard, with the term "good faith" replaced by "non-frivolous" throughout the rule and Comment.

The Commission has revised and reorganized Rule 3.3 ("Candor Toward the Tribunal") to clarify a lawyer's obligations with respect to testimony given and actions taken by the client and other witnesses. The Comment was reorganized and expanded to address some recurring situations not directly addressed in the Rule. In some particulars, the lawyer's obligations to the tribunal have been strengthened. For example, the Rule now makes clear that the lawyer must not allow the introduction of false evidence and must take remedial steps where the lawyer comes to know that material evidence offered by the client or a witness called by the lawyer is false - regardless of the client's wishes. As under the existing Rule, the lawyer's obligations to the tribunal may require the lawyer to reveal information otherwise protected by Rule 1.6. The lawyer's obligation in the existing Rule to avoid assisting client crime or fraud is replaced by a broader obligation to ensure the integrity of the adjudicative process. The lawyer must take remedial measures whenever the lawyer comes to know that any person is engaging or has engaged in criminal or fraudulent conduct related to the proceeding, such as jury tampering or document destruction.

In one special case, however, the lawyer's obligation to the client has been reaffirmed and strengthened, and that is where the lawyer represents the defendant in a criminal proceeding. For the first time the Rule text will address the special obligations of a criminal defense lawyer, providing that such a lawyer does not have the same discretion as other lawyers regarding the client's own testimony. While a criminal defense lawyer is subject to the general rule prohibiting the offering of testimony the lawyer "knows" to be false, the lawyer may not refuse to allow a defendant to testify in the defendant's defense if the lawyer only "reasonably believes" the testimony will be false. The Comment also provides that where a court insists that a criminal defendant be permitted to testify in the defendant's defense, the lawyer commits no ethical violation in allowing the client to do so even if the lawyer knows the client intends to lie.

12. Obligations to Third Parties

The Commission proposes no change in the text of Rule 4.1 ("Truthfulness in Statements to Others"), but will clarify in Comment the duty imposed by paragraph (b) (a lawyer may not knowingly "fail to disclose a material fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by a client, unless disclosure would be prohibited by Rule 1.6"). This duty is a specific application of the lawyer’s general duty not to assist client fraud or crime set forth in Rule 1.2(d), and is most frequently invoked where a client’s wrongdoing involves a lie or misrepresentation to a third party. New commentary explains the relationship between the lawyer’s duty to third parties under Rules 1.2(d) and 4.1(b), and the lawyer’s duty of confidentiality to the client under Rule 1.6.

A new provision of Rule 4.4 ("Respect for Rights of Third Persons") deals with the currently controversial issue of the "errant FAX." It provides that a lawyer who receives a document, and knows or reasonably should know that it was inadvertently sent, must promptly notify the sender. Beyond this, however, the rule does not attempt to sort out a lawyer’s possible obligations under other law in connection with examining and using confidential documents that come into the lawyer’s possession through the inadvertence or wrongful act of another.

13. Communication with Represented and Unrepresented Persons

The Commission spent a great deal of time and energy considering possible amendments to Rule 4.2 ("Communication with Person Represented by Counsel"), to meet concerns raised by the U.S. Department of Justice. In the end, the Commission decided to propose only one amendment to the black letter of the rule, confirming that otherwise prohibited communications may be authorized by court order. New commentary provides that a court order may be sought either to clarify the application and scope of the rule or, in exceptional circumstances, to authorize communication that would otherwise be prohibited by the rule.

Existing commentary is revised to explain that communications "authorized by law" may include, for example, those made (a) by a lawyer "on behalf of a client who is exercising a constitutional or other legal right to communicate with a government official," where the government official has "authority to take or recommend action in the matter" and (b) in the course of "investigative activities of lawyers representing governmental entities, directly or indirectly through investigative agents, prior to the commencement of criminal or civil enforcement proceedings." In this latter regard, the revised Comment attempts to clarify the relationship between Rule 4.2 and constitutional limits on government lawyers’ investigative activities: "The fact that a communication does not violate a state or federal constitutional right is insufficient to establish that the communication is permissible under this rule."

New commentary makes clear that the no-contact rule does not preclude a lawyer from advising a represented person who is seeking a second opinion, as long as the lawyer is not otherwise representing a client in the matter. It also confirms that a lawyer may not make a communication prohibited by the rule through the acts of another – though parties to a matter may communicate directly with each other. Finally, it provides that the "no-contact rule" applies even when the represented person "initiates or consents to" the communication, and that a lawyer must immediately terminate communications if the lawyer learns that the person is one with whom communication is not permitted.

With respect to the applicability of the no-contact rule in the organizational context, the test has been modified so that communication is now prohibited with "a constituent" of the organization who "supervises, directs, or regularly consults with the organization’s lawyer concerning the matter or has authority to obligate the organization with respect to the matter, or whose act or omission in the matter may be imputed to the organization for purposes of civil or criminal liability." The Commission deleted the problematic reference in the current rule to persons whose "statement may constitute an admission on the part of the organization." The Comment also clarifies that the rule does not bar communications with former constituents.

The Commission proposes to restore to Rule 4.3 ("Dealing with Unrepresented Person") a provision from the predecessor Model Code of Professional Responsibility prohibiting a lawyer from giving legal advice to an unrepresented person whose interests "are or have a reasonable possibility of being in conflict" with those of the lawyer’s client, other than the advice to seek counsel. New commentary provides guidance on what constitutes impermissible advice-giving, and alludes to the particular problems that may arise when a lawyer for an organization deals with an unrepresented constituent.

The foregoing brief survey of the highlights of the Commission’s work will suggest particular areas of interest that can be explored more fully by reference to the full text of the proposed amendments and explanatory notes accompanying each Rule. The Commission invites all interested persons and entities to study and carefully consider our proposals and we invite further comments with specific suggestions for drafting language.

In closing this introduction, I want to express my gratitude to and admiration for my colleagues. The chemistry, good will, good humor, serious purpose, collegiality and hard work of the Commission members, Reporters and ABA staff has been extraordinary. The profession and the public have been enriched beyond measure by their efforts. It has been - and continues to be - a pleasure and a privilege for me to work with all of them. The Commission also expresses its gratitude to the law firm of Drinker Biddle & Reath, whose generous contribution made possible the continued, invaluable support of the Commission's Chief Reporter.

For the Commission:

E. Norman Veasey, Chair

 

SUMMARY OF PROPOSED CHANGES

PREAMBLE

  • removed reference in paragraph [2] to Rule 2.2, which has been deleted
  • new paragraph [3] addresses the lawyer’s role as a third-party neutral
  • added references in paragraph [6] to a lawyer’s duty to promote access to justice and to further public understanding of the law
  • added further guidance in paragraph [9] on how the principles underlying the Rules may help resolve conflicts between a lawyer’s competing responsibilities and interests

SCOPE

  • deleted material that is no longer accurate or is redundant
  • amended paragraph [20] to reflect decisions of courts on the relationship between the Rules and causes of action against a lawyer, including the admissibility of evidence of a violation of a Rule in appropriate cases

Rule 1.0 TERMINOLOGY

  • created new Rule 1.0 on Terminology
  • added new definitions of "confirmed in writing," "informed consent," "screened," "tribunal," and "writing"
  • amended definitions of "firm" and "fraud"
  • deleted definition of "consultation" because "informed consent" has replaced "consents after consultation" throughout the Rules
  • new Comment explains the definitions

Rule 1.1 COMPETENCE

  • no change to black-letter Rule
  • expanded the Comment to address agreements to limit the scope of the representation and to identify three aspects of continuing education relevant to maintaining competence

Rule 1.2 SCOPE OF REPRESENTATION AND ALLOCATION OF AUTHORITY BETWEEN CLIENT AND LAWYER

  • changed Rule title from "Scope of Representation"
  • added a reference in paragraph (a) to Rule 1.4, which addresses the lawyer’s duty to communicate with the client
  • added a sentence in paragraph (a) acknowledging the lawyer’s implied authority to take action to carry out the representation
  • replaced "whether to accept offer of settlement" in paragraph (a) with "whether to settle"
  • modified paragraph (c) to permit reasonable limitations on the scope of a lawyer’s representation
  • moved paragraph (e) to Rule 1.4, which, as amended, addresses all aspects of the duty to communicate
  • made extensive modifications to the Comment to provide better guidance and explanation

Rule 1.3 DILIGENCE

  • no changes to black-letter Rule
  • made changes to the Comment to clarify the lawyer’s authority and duty to take action on behalf of the client, provide support for the bar’s civility initiatives and sharpen the discussion of a lawyer’s responsibilities with respect to taking an appeal from an adverse decision

Rule 1.4 COMMUNICATION

  • combined in Rule 1.4 all aspects of a lawyer’s duty to communicate with the client
  • modified the Comment to explain more fully the lawyer’s duty to communicate with the client

Rule 1.5 FEES

  • substituted Model Code language ["A lawyer shall not make an agreement for, charge, or collect an unreasonable fee"] for current Rule [‘A lawyer’s fee shall be reasonable"] in paragraph (a)
  • added an explicit prohibition on unreasonable expenses in paragraph (a)
  • amended the list of factors to be considered in determining the reasonableness of a fee by replacing "whether the fee is fixed or contingent" in paragraph (a)(8) with "the degree of risk assumed by the lawyer"
  • added a requirement in paragraph (b) that the lawyer communicate fees, scope and expenses in writing
  • added a requirement that any changes in the basis or rate of the fee or expenses shall be in writing
  • amended paragraph (c) to clarify that contingent fee agreements must be signed by the client and must include notification regarding expenses
  • amended paragraph (e) to permit division of fees with client agreement
  • expanded the Comment to address reasonableness of fees and expenses generally, reasonableness of contingent fees and prohibited contingent fees
  • modified the Comment to reflect the changes in the Rule

Rule 1.6 CONFIDENTIALITY OF INFORMATION

  • replaced "consents after consultation" with "informed consent"
  • modified paragraph (b)(1) to permit disclosure of information related to the representation to prevent "reasonably certain" death or substantial bodily harm
  • added paragraph (b)(2), which permits disclosure of information related to the representation to prevent the client from committing a crime or fraud that is reasonably certain to result in substantial injury to the financial interests or property of another and in furtherance of which the client has used or is using the lawyer’s services
  • added paragraph (b)(3), which permits disclosure of information related to the representation to prevent, mitigate or rectify substantial injury to the financial interests or property of another that is reasonably certain to result or has resulted from the client’s commission of a crime or fraud in furtherance of which the client has used the lawyer’s services
  • added paragraph (b)(4), which permits disclosure of information related to the representation to secure legal advice about the lawyer’s compliance with the Rules
  • added paragraph (b)(5), which permits disclosure of information related to the representation to comply with other law or a court order
  • reorganized and substantially revised the Comment to provide better guidance and to reflect the changes in the Rule

Rule 1.7 CONFLICT OF INTEREST: CURRENT CLIENTS

  • changed title from "Conflict of Interest: General Rule"
  • reorganized current Rule 1.7 to clarify the Rule and to better educate lawyers regarding the complex subject of conflict of interest
  • created a single paragraph defining "conflict of interest" and a single paragraph on consentability and informed consent
  • replaced "consent after consultation" with "informed consent" and added a requirement that informed consent be confirmed in writing
  • substantially revised the Comment to provide better guidance to lawyers

Rule 1.8 CONFLICT OF INTEREST: CURRENT CLIENTS: SPECIFIC RULES

  • changed title from "Conflict of Interest: Prohibited Transactions"
  • added a requirement in paragraph (a) that clients be advised in writing of the desirability of seeking the advice of independent legal counsel before entering into a business transaction with a lawyer
  • added a requirement in paragraph (a) that the client give informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer’s role in the transaction
  • replaced "consent after consultation" with "informed consent" in paragraph (b)
  • added a prohibition on lawyer solicitation of substantial gifts and changed the definition of relationships that fall within the exception for lawyers related to the client or the donee in paragraph (c)
  • replaced "consent after consultation" with "informed consent" in paragraph (f)
  • replaced "consent after consultation" with "informed consent" in paragraph (g) and added a requirement that the informed consent be in a writing signed by the client
  • split paragraph (h) into two parts: deleted the reference to "permitted by law" in paragraph (h)(1) because the phrase has no significant role in addressing these conflicts; added reference to "potential claims" in paragraph (h)(2); reworded the advice to obtain independent counsel in paragraph (h)(2) to conform to the language used in paragraph 1.8(a)
  • moved paragraph (i) to Comment [11] of Rule 1.7 where conflicts of interest arising from a lawyer’s family relationships is more appropriately addressed
  • changed "granted" to "authorized" in paragraph (i), previously paragraph (j), to clarify that the exemption applies to all liens authorized by substantive law, including those liens that are contractual in nature
  • added a new Rule prohibiting most client-lawyer sexual relationships
  • added a provision regarding imputation of conflicts in Rule 1.8, treating imputation in Rule 1.8 differently from Rule 1.10
  • made extensive changes to the Comment to address every paragraph in Rule 1.8 and to reflect the changes in the Rule

Rule 1.9 DUTIES TO FORMER CLIENTS

  • changed title from "Conflict of Interest: Former Client"
  • replaced "consent after consultation" with "informed consent" in paragraphs (a) and (b) and added a requirement that the informed consent be confirmed in writing
  • replaced specific reference to Rules 1.6 and 3.3 in paragraph (c) with general reference to the Rules because Rules other than 1.6 and 3.3 may be relevant
  • amended the Comment to clarify the operation of the Rule and to specifically note that Rule 1.11 determines when Rule 1.9 is applicable to government lawyers

Rule 1.10 IMPUTATION OF CONFLICTS OF INTEREST: GENERAL RULE

  • changed the title from "Imputed Disqualification: General Rule"
  • eliminated imputation of conflicts under Rule 2.2, which has been deleted, and Rule 1.8, which now contains a provision addressing imputation
  • eliminated imputation of "personal interest" conflicts
  • added a provision for screening of lateral hires under certain circumstances
  • added a provision clarifying that Rule 1.11 is the exclusive Rule governing the imputation of conflicts of interest of current or former government lawyers
  • moved the definition of "firm" and the Comments relating to the definition of "firm" to the new Rule 1.0 on Terminology
  • expanded the Comment to explain principles of imputed disqualification and to provide guidance regarding screening

Rule 1.11 SPECIAL CONFLICTS OF INTEREST FOR FORMER AND CURRENT GOVERNMENT OFFICERS AND EMPLOYEES

  • changed title from "Successive Government and Private Employment"
  • replaced "consent after consultation" with "informed consent" in paragraph (a) and added a requirement that the informed consent be confirmed in writing
  • clarified in paragraph (a) that individual lawyers who have served as public officers or employees are subject to Rule 1.9 regarding their obligations to former clients, except that "matter" is defined in Rule 1.11(e)
  • clarified in paragraph (b) that conflicts under paragraph (a) are not imputed to other associated lawyers when the individual lawyer is properly screened
  • added a scienter requirement in paragraph (b) to parallel Rule 1.10
  • deleted current paragraph (e) and moved the definition of "confidential government information" to paragraph (c)
  • amended paragraph (d) to clarify the relationship between this Rule and Rules 1.9 and 1.10
  • added a provision allowing the government to give its informed consent, confirmed in writing, in paragraph (d)
  • expanded and modified the Comment to reflect the changes in the Rule

Rule 1.12 FORMER JUDGE, ARBITRATOR, MEDIATOR OR OTHER THIRD-PARTY NEUTRAL

  • changed caption from "Former Judge or Arbitrator"
  • extended the application of Rule 1.12 to mediators and other third-party neutrals
  • replaced "consent after consultation" with "informed consent" in paragraph (a) and added a requirement that the informed consent be confirmed in writing
  • expanded the Comment to explain the applicability of the Rule to third-party neutrals and to elaborate on the requirements for screening

Rule .113 ORGANIZATION AS CLIENT

  • clarified the scienter requirement in paragraph (d)
  • modified Comment [6] to more accurately reflect prevailing law regarding the identity of a government client

Rule 1.14 CLIENT WITH DIMINISHED CAPACITY

  • changed title from "Client Under a Disability"
  • changed terminology to reflect the change of focus of the Rule to the continuum of a client’s capacity
  • added guidance in paragraph (b) regarding protective measures a lawyer may take short of requesting a guardian and clarified when it is appropriate to take such action
  • substantially amended the Comment to reflect the changes in the Rule

Rule 1.15 SAFEKEEPING PROPERTY

  • added a provision to permit a lawyer to deposit funds in a client trust account in order to minimize bank changes
  • expanded paragraph (d) to cover property in which two or more persons claim interests
  • amended the Comment to reflect the changes in the Rule

Rule 1.16 DECLINING OR TERMINATING REPRESENTATION

  • clarified that "withdrawal without material adverse effect on the interest of the client" is one of seven situations when a lawyer may withdraw from the representation
  • changed permissive withdrawal in paragraph (b)(4) to situations where the client insists on taking action that the lawyer considers repugnant or with which the lawyer has a fundamental disagreement
  • added a reference in paragraph (c) to applicable law requiring notice to or permission of a tribunal when terminating a representation
  • made minor changes to the Comment to reflect the changes in the Rule

Rule 1.17 SALE OF A LAW PRACTICE

  • amended paragraph (b) to permit sale of a practice to one or more lawyers as long as the entire practice is sold
  • deleted provision that permitted the purchaser to refuse to undertake the representation unless the client consented to pay the purchaser’s customary fees
  • made minor changes to the Comment to reflect the changes in the Rule

Rule 1.18 DUTIES TO PROSPECTIVE CLIENTS

  • created a new Rule outlining duties to prospective clients
  • paragraph (a) defines "prospective client"
  • paragraph (b) identities the duty of confidentiality owed prospective clients
  • paragraph (c) prohibits later representation adverse to the prospective client
  • paragraph (d) permits representation with the consent of the client, confirmed in writing; or if the lawyer who received any "significantly harmful" information is screened
  • new Comment explains the operation of the Rule

Rule 2.1 ADVISOR

  • no change to the black-letter Rule
  • amended Comment [5] to remind lawyers that informing a client of various forms of dispute resolution may be required under Rule 1.4

Rule 2.2 INTERMEDIARY

  • deleted this Rule and moved discussion of common representations to the Comment of Rule 1.7

Rule 2.3 EVALUATION FOR USE BY THIRD PARTIES

  • restructured the Rule to clarify its application in situations where the evaluation poses no significant risk to the client and in situations where there is a significant risk of material and adverse effect on the client’s interest
  • replaced "consents after consultation" with "informed consent" in paragraph (b)
  • expanded the Comment to address informed consent; added a cross-reference to Rule 4.1 regarding truthfulness in statements to others

Rule 2.4 LAWYER SERVING AS THIRD-PARTY NEUTRAL

  • created a new Rule on the lawyer’s role as third-party neutral
  • paragraph (a) defines "third-party neutral"
  • paragraph (b) requires the lawyer to inform unrepresented parties of the lawyer’s role
  • new Comment explains the operation of the Rule

Rule 3.1 MERITORIOUS CLAIMS AND CONTENTIONS

  • replaced "good faith" with "nonfrivolous" to adopt an objective standard
  • clarified that a nonfrivolous argument must have a basis in both law and fact
  • two new Comments address criminal defendants
  • modified Comment [2] to conform to changes in the Rule

Rule 3.2 EXPEDITING LITIGATION

  • no changes

Rule 3.3 CANDOR TOWARD THE TRIBUNAL

  • revised and reorganized this Rule to clarify a lawyer’s obligation of candor to the tribunal with respect to testimony given and actions taken by the client and other witnesses
  • amplified in paragraph (a) the lawyer’s duty not to make false statements to a tribunal and added obligation to correct false statements previously made
  • deleted paragraph (a)(2) regarding disclosure where necessary to avoid assisting client crime or fraud because that subject in now addressed in paragraph (b)
  • added a new paragraph (b) addressing the lawyer’s duty to preserve the integrity of the adjudicative process
  • added an exclusion in paragraph (a)(3) for the testimony of a defendant in a criminal matter
  • clarified in paragraph (a)(3) that the lawyer must take remedial measures where the lawyer comes to know that material evidence offered by the client or a witness called by the lawyer is false
  • reorganized and expanded the Comment to address some recurring situations not directly addressed in the Rule and to provide guidance regarding the operation of the Rule

Rule 3.4 FAIRNESS TO OPPOSING PARTY AND COUNSEL

  • no change to black-letter Rule
  • amended Comment [2] to alert lawyers to the law governing possession of physical evidence of client crimes

Rule 3.5 IMPARTIALITY AND DECORUM OF THE TRIBUNAL

  • created a new paragraph (c) covering post-discharge communication with jurors
  • limited paragraph (b) to communication during the proceeding
  • expanded the Comment to reflect the changes in the Rule

Rule 3.6 TRIAL PUBLICITY

  • conformed the scienter requirement to be consistent with the terminology in Rule 1.0
  • replaced "reasonable person" with "reasonable lawyer"
  • added a reference to Rule 3.8(f) regarding additional duties of prosecutors in connection with extrajudicial statements about criminal proceedings

Rule 3.7 LAWYER AS WITNESS

  • minor editing change in black-letter Rule
  • clarified in Comment that the prohibition in paragraph (a) is for the protection of the tribunal as well as the parties
  • expanded the Comment to address conflicts of interest and vicarious disqualification

Rule 3.8 SPECIAL RESPONSIBILITIES OF A PROSECUTOR

  • incorporated current paragraph (e) into paragraph (f)
  • expanded Comment to elaborate on the rationale for the Rule

Rule 3.9 ADVOCATE IN NONADJUDICATIVE PROCEEDINGS

  • deleted the word "tribunal" to avoid confusion
  • expanded the Comment to explain the operation of the Rule

Rule 4.1 TRUTHFULNESS IN STATEMENTS TO OTHERS

  • no change to the black-letter Rule
  • expanded the Comment to address misrepresentation through omissions or partially true but misleading statements and remedial measures a lawyer may be required to take to avoid assisting client crime or fraud

Rule 4.2 COMMUNICATION WITH PERSON REPRESENTED BY COUNSEL

  • added reference to "court order"
  • expanded the Comment to explain the operation of the Rule and to reflect the change in the Rule; modified the explanation of the operation of the Rule with respect to a represented organization

Rule 4.3 DEALING WITH UNREPRESENTED PERSON

  • added prohibition (using language from Model Code) on giving legal advice to an unrepresented person if the lawyer knows or reasonably should know that the interests of such a person are or have a reasonable possibility of being in conflict with the interests of the client
  • expanded the Comment to reflect the changes in the Rule

Rule 4.4 RESPECT FOR RIGHTS OF THIRD PERSONS

  • added a new paragraph regarding obligations of a lawyer upon receipt of an inadvertently sent document
  • expanded the Comment to explain the new paragraph

Rule 5.1 RESPONSIBILITIES OF PARTNERS, SUPERVISORY LAWYERS AND LAW FIRMS

  • changed title from "Responsibilities of a Partner or Supervisory Lawyer"
  • added lawyers who possess managerial authority to those responsible under this Rule
  • added law firm responsibility
  • expanded the Comment to address law firm responsibility and the responsibility to establish internal policies and procedures designed to provide reasonable assurance that all lawyers in the firm conform to the Rules of Professional Conduct

Rule 5.2 RESPONSIBILITIES OF A SUBORDINATE LAWYER

  • no changes

Rule 5.3 RESPONSIBILITIES REGARDING NONLAWYER ASSISTANTS

  • added lawyers who possess managerial authority to those responsible under this Rule
  • added law firm responsibility
  • expanded the Comment explaining the changes in the Rule

Rule 5.4 PROFESSIONAL INDEPENDENCE OF A LAWYER

  • added a provision regarding sharing of court-awarded fees with a nonprofit organization
  • expanded the Comment to discuss limits on third-party direction

Rule 5.5 UNAUTHORIZED PRACTICE OF LAW

  • added a new paragraph (b), which describes four "safe harbors" for lawyers rendering legal services in jurisdictions where they are not admitted to practice
  • clarified that paragraph (c) applies to assisting lawyers not admitted to practice in this jurisdiction
  • expanded the Comment to explain the operation of new paragraph (b)

Rule 5.6 RESTRICTIONS ON RIGHT TO PRACTICE

  • no changes to black-letter Rule
  • minor edit in the Comment

Rule 5.7 RESPONSIBILITIES REGARDING LAW-RELATED SERVICES

  • no changes to black-letter Rule
  • minor edit in the Comment

Rule 6.1 VOLUNTARY PRO BONO PUBLICO SERVICE

  • added new first sentence regarding the professional responsibility of every lawyer to provide legal services to those unable to pay
  • added a new Comment calling upon law firms to act reasonably to enable lawyers in the firm to provide pro bono services

Rule 6.2 ACCEPTING APPOINTMENTS

  • no changes

Rule 6.3 MEMBERSHIP IN LEGAL SERVICE ORGANIZATION

  • no changes

Rule 6.4 LAW REFORM ACTIVITIES AFFECTING CLIENT INTERESTS

  • no changes

Rule 6.5 NONPROFIT AND COURT-ANNEXED LIMITED LEGAL SERVICE PROGRAMS

  • created a new Rule relaxing the conflict of interest and imputation rules in situations where a lawyer, under the auspices of a program sponsored by a nonprofit organization or court, provides short-term limited legal services to a client without expectation that the lawyer will provide continuing representation in the matter
  • new Comment explains the operation of the Rule

Rule 7.1 COMMUNICATION CONCERNING A LAWYER’S SERVICES

  • deleted paragraphs (b) and (c) as overly broad, limiting Rule 7.1 to a prohibition against false and misleading communications
  • moved a portion of paragraph (b) to Rule 8.4 because the prohibition against stating or implying that the lawyer can achieve results by means the violate the Rules is applicable beyond advertising
  • expanded the Comment to explain circumstances under which statements raising unjustified expectations and making unsubstantiated comparisons may be false or misleading

Rule 7.2 ADVERTISING

  • deleted specification of types of public media in paragraph (a) and added a reference to electronic communication
  • deleted the requirement of retaining copies of all advertisements for two years
  • modified paragraph (c) to permit identification of a law firm as the entity responsible for an advertisement
  • modified the Comment to more accurately reflect the current state of client development activities in law firms

Rule 7.3 DIRECT CONTACT WITH PROSPECTIVE CLIENT

  • extended prohibition to "real-time electronic contact"
  • exempted contact with lawyers and with person with whom the lawyer has a close personal relationship
  • added reference to electronic communication
  • modified the Comment to reflect the changes in the Rule

Rule 7.4 COMMUNICATION OF FIELDS OF PRACTICE AND SPECIALIZATION

  • title changed from "Communication of Fields of Practice"
  • restructured Rule to separate the two subjects addressed: communication of fields of law in which the lawyer practices, as permitted in paragraph (a), and communication of fields of law in which the lawyer claims to be certified as a specialist, covered in paragraph (d)
  • eliminated the provision that permits lawyers to claim certification as a specialist even though the certifying organization is not approved by an appropriate state authority or accredited by the ABA
  • modified the Comment to reflect the changes in the Rule

Rule 7.5 FIRM NAMES AND LETTERHEADS

  • added reference to "other professional designation" in Rule and Comment

Rule 7.6 POLITICAL CONTRIBUTIONS TO OBTAIN GOVERNMENT LEGAL ENGAGEMENTS OR APPOINTMENTS BY JUDGES

  • no changes

Rule 8.1 BAR ADMISSION AND DISCIPLINARY MATTERS

  • no change in the black-letter Rule
  • modified Comment [1] to clarify the obligation to correct any prior misstatements

Rule 8.2 JUDICIAL AND LEGAL OFFICERS

  • no changes

Rule 8.3 REPORTING PROFESSIONAL MISCONDUCT

  • modified scienter requirement to conform to new Rule 1.0 on Terminology
  • replaced references to the attorney-client privilege in paragraph (c) and in Comment [5] with references to information related to the representation

Rule 8.4 MISCONDUCT

  • added material in paragraph (e) that was deleted from Rule 7.1
  • added a new Comment [1] to distinguish a violation of the Rules through the acts of another from legally advising a client concerning actions the client is lawfully entitled to take

Rule 8.5 DISCIPLINARY AUTHORITY; CHOICE OF LAW

  • expanded disciplinary enforcement jurisdiction over a lawyer not admitted in the jurisdiction if the lawyer renders or offers to render any legal services in the jurisdiction
  • changed "court" to "tribunal" in paragraph (b)
  • created new choice of law provision
  • amended the Comment to explain the changes in the Rule

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