## Facts

- An attorney was engaged by the personal representative of an estate to prepare probate documents, including estate accountings to be filed with the probate court.
- The estate’s sole beneficiary was an elderly woman living in a nursing home.
- While preparing the accountings, the attorney found a serious discrepancy between (a) cash in the decedent’s bank accounts at death and (b) the cash the personal representative used to open the estate account.
- The attorney also had other (unspecified) information suggesting misuse of estate assets and received information that the beneficiary’s bills were not being paid.
- After these discoveries, the attorney was unable to reach the personal representative by telephone or mail, while a final-accounting deadline was approaching.
- The attorney planned to withdraw as counsel of record and asked the Maryland State Bar Association Committee on Ethics whether the attorney could report suspected misuse of estate assets to Adult Protective Services.
- In a separate scenario, the attorney was consulted by a client caring for an elderly husband at home; during the attorney-client conversation, the client disclosed she paid caregivers in cash and had not withheld FICA, paid household employment taxes, or paid worker’s compensation or unemployment insurance, stating a CPA told her these were unnecessary.
- The attorney inferred the attorney corrected that advice and told the client the obligations applied (including to a household cleaning person), but the client refused further counseling on the subject.
- The attorney asked whether there was a duty to report the client’s noncompliance to authorities.

## Issues

1. Whether, consistent with Maryland Rule of Professional Conduct 1.6, the attorney may or must report suspicions that a personal representative misused estate assets to Adult Protective Services.
2. Whether Rule 1.6(b)(1) permits disclosure of information about a client’s past misuse of estate assets, as opposed to disclosure aimed at preventing likely future criminal or fraudulent conduct causing substantial financial injury.
3. Whether Rule 1.6(b)(2) permits disclosure to rectify consequences of a client’s crime or fraud when there is no showing that the lawyer’s services were used to further the wrongdoing.
4. Whether withdrawal changes the attorney’s confidentiality obligations, and whether Rules 3.3 (candor to the tribunal) and 4.1 (truthfulness to others) can require disclosure if continued representation would assist client fraud.
5. Whether the attorney may or must report a client’s failure to withhold and pay household employment taxes and related obligations, based on the client’s disclosures.

## Decision

- The Committee advised that the attorney had no duty to report suspected misuse of estate assets to Adult Protective Services.
- The Committee advised that, absent client consent or an applicable Rule 1.6(b) exception, the attorney may not disclose information relating to the representation to authorities.
- The Committee stated Rule 1.6(b)(1) concerns preventing a client’s prospective criminal or fraudulent conduct likely to cause substantial financial injury; it does not permit disclosure of client wrongdoing that has already occurred, standing alone.
- The Committee explained that Rule 1.6(b)(2) did not apply on the facts presented because the attorney did not identify facts showing the client used the attorney’s services to further a criminal or fraudulent act.
- The Committee advised that confidentiality continues after withdrawal; ending the attorney-client relationship does not change Rule 1.6 duties.
- The Committee cautioned that if the attorney continues representation and must submit filings or make statements in a setting where Rules 3.3 or 4.1 apply, those rules impose required duties and may demand disclosure necessary to avoid assisting client crime or fraud, even if the information would otherwise be protected by Rule 1.6.
- In the tax scenario, the Committee treated the conversation as within the attorney-client relationship and therefore covered by Rule 1.6; on the facts given, there was no duty to report and no identified exception permitting disclosure.
- The Committee noted that whether a client’s future omissions would cause “substantial injury” under Rule 1.6(b)(1) is fact-dependent; however, because the client did not indicate an intent to continue unlawful practices, the Committee did not view an exception as triggered on the stated facts.

## Legal Principles

- Rule 1.6 protects all information relating to representation of a client, regardless of source, unless the client consents, disclosure is impliedly authorized to carry out the representation, or an exception in Rule 1.6(b) applies.
- Rule 1.6(b) exceptions are permissive; they allow (but do not require) disclosure only to the extent the lawyer reasonably believes necessary.
- Rule 1.6(b)(1) is directed to preventing a client from committing future criminal or fraudulent acts likely to result in substantial injury to another’s financial interests or property; knowledge limited to past misconduct does not by itself permit disclosure under this exception.
- Rule 1.6(b)(2) permits limited disclosure to rectify consequences of a client’s crime or fraud only when the lawyer’s services were used in furtherance of that conduct; absent such use, the exception does not apply.
- Rule 1.6 obligations continue after withdrawal; termination of the representation does not free the lawyer to disclose confidential information.
- Rules 3.3 and 4.1 impose required duties not to make false statements and not to withhold facts when disclosure is necessary to avoid assisting client crime or fraud; compliance may require disclosure even when Rule 1.6 would otherwise bar it.
- A lawyer’s representation of a personal representative in a fiduciary capacity does not, by itself, create attorney-client duties to the estate’s beneficiary. See Ferguson v. Cramer, 349 Md. 760 (1998).

## Conclusion

Ethics Docket No. 2001-18 concludes that an attorney generally may not report suspected misuse of estate assets by a personal representative, or a client’s household employment tax noncompliance, because Rule 1.6 protects information relating to the representation; disclosure is allowed only if a specific Rule 1.6(b) exception applies (most relevantly, to prevent likely future client crime or fraud causing substantial financial injury) or if disclosure is required by other professional duties such as Rules 3.3 and 4.1 in connection with court filings, and confidentiality continues even if the attorney withdraws.


Duty to Report Improper Conduct by a Personal Representative, Ethics Docket No. 2001-18 (2001)