A few months ago, I wrote an InsidePerspectives column (see “Higher Standards,” November 2008) urging a community-based approach to raising awareness of ethical issues in-house counsel face. My commitment to this idea was tested when InsideCounsel asked me to participate in its new ethics column. I am not an accomplished writer on this topic, but I have a concern that in-house counsel tend to relegate ethics proficiency to remote positions on their “to-do” lists.
For some the content in this column will be familiar, but I urge you to view it as a necessary review. Remember, the in-house counsel who found themselves entangled in high-profile ethical and legal difficulties were seasoned corporate counsel (see “Under Scrutiny,” June 2008). Clearly, this subject matter becomes more critical as we progress in our careers. For those new to the in-house practice, I hope this column will serve as a syllabus for your ethics training.
Let’s start with client identity, because the stories of in-house counsel who have found themselves in ethical and legal difficulties share a common theme: The client was overlooked.
In just about every case, the in-house lawyer replaced fidelity to the client with self-interest or loyalty to the management team. Whether those transgressions were intentional or negligent, the proper attorney-client relationship requires attention and recommitment.
The Model Rules of Professional Conduct provide that “[a] lawyer employed or retained by an organization represents the organization acting through its duly authorized constituents.” Organizational constituents remain identified with the client provided they are acting in the interest of the client. To the extent that a constituent’s interests are adverse to the client’s, the Rule counsels that the lawyer “shall explain the identity of the client.”
Comment 10 to this rule explains: “Care must be taken to assure that the individual understands that, when there is such adversity of interest, the lawyer for the organization cannot provide legal representation for that constituent individual, and that discussions between the lawyer for the organization and the individual may not be privileged.”
The importance of clarifying the attorney-client relationship when a constituent’s adverse interest is apparent has given rise to the use of “corporate Miranda warnings.” These are designed to set organizational constituents’ expectations by clarifying your role to represent the corporation.
While the concept of the organizational client is complicated for in-house counsel, this notion is absolutely foreign to our corporate constituents. This nuanced conception of the client stands in stark contrast to the common portrayal and understanding of the attorney-client relationship, replete with expectations of an absolute duty of confidentiality.
The manner in which our constituents often perceive legal departments reinforces this misperception. Too often we are cast or cast ourselves as the corporate team’s attorneys. Often, our business partner communications suggests that we owe direct duties to the constituents. We must accept that for corporate personnel, the term “client” evokes a vision of the attorney-client relationship that is inapposite in the corporate setting.
Managing this complex aspect of in-house practice requires setting expectations across the organization. Introducing the concept of the client in regular training, staff meetings and one-on-one meetings will minimize misunderstandings as to the nature of our duties.
This column will strive to be focused on reader-identified issues and concerns. Please send me your suggestions for the content of this community dialog on in-house ethics at email@example.com.