Current-client conflicts - Multiple clients and joint repres...

Learning Outcomes

After reading this article, you will be able to identify when representing multiple clients creates a conflict of interest, explain the requirements for joint representation, and apply the rules for obtaining informed consent and handling aggregate settlements. You will also recognize when withdrawal is required and how these issues are tested on the MPRE.

MPRE Syllabus

For the MPRE, you are required to understand the ethical rules governing conflicts of interest when representing multiple current clients. This article covers:

• Recognizing direct adversity and material limitation conflicts among current clients.
• The requirements for joint representation and informed consent.
• The process for obtaining and documenting client consent.
• Restrictions on aggregate settlements involving multiple clients.
• The duty to withdraw when conflicts become unwaivable.
• The effect of revocation of consent by one or more clients.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. A lawyer represents two business partners in negotiating a contract with a third party. The partners later disagree about a key term. What must the lawyer do?
   1. Continue representing both if both consent orally.
   2. Withdraw from representing both unless both give informed consent in writing and the lawyer reasonably believes she can represent both.
   3. Represent only the partner who first contacted her.
   4. Decide for herself which partner to continue representing.
2. Which of the following is required before a lawyer may represent multiple clients in the same matter with potential conflicts?
   1. Oral consent from each client.
   2. Informed consent, confirmed in writing, from each client.
   3. Consent from only the client most at risk.
   4. No consent if the clients are family members.
3. In an aggregate settlement involving several clients, what must the lawyer do?
   1. Obtain each client’s informed consent in writing after full disclosure.
   2. Only disclose the total settlement amount to all clients.
   3. Decide the allocation herself and inform the clients later.
   4. Obtain oral consent from each client.
4. If one client revokes consent to joint representation, the lawyer:
   1. May continue representing the other client automatically.
   2. Must withdraw from representing all clients in the matter, unless circumstances permit continued representation.
   3. Must seek court approval to continue.
   4. May ignore the revocation if it is not in writing.

Introduction

A lawyer may be asked to represent multiple clients in the same matter, such as co-plaintiffs, co-defendants, or business partners. However, representing more than one client often creates a risk of conflict of interest. The Model Rules require lawyers to avoid representing clients with directly adverse interests or where there is a significant risk that representation will be materially limited by duties to another client.

Key Term: Current-Client Conflict
A situation where a lawyer’s representation of one client is directly adverse to, or materially limited by, responsibilities to another current client.

Identifying Conflicts in Multiple Client Representation

A lawyer must not represent clients with directly adverse interests in the same matter. Even if interests are not directly adverse, a conflict exists if there is a significant risk that the lawyer’s representation will be materially limited by duties to another client.

Key Term: Direct Adversity
When a lawyer’s representation of one client is directly opposed to the interests of another current client in the same matter.

Key Term: Material Limitation
When a significant risk exists that a lawyer’s ability to consider, recommend, or carry out an appropriate course of action for a client will be limited by the lawyer’s responsibilities to another client.

Joint Representation and Informed Consent

A lawyer may represent multiple clients in the same matter only if:

1. The lawyer reasonably believes she can provide competent and diligent representation to each client.
2. The representation is not prohibited by law.
3. The representation does not involve asserting a claim by one client against another in the same proceeding.
4. Each affected client gives informed consent, confirmed in writing.

Key Term: Joint Representation
The representation of two or more clients by the same lawyer in the same matter.

Key Term: Informed Consent
Agreement by a client to a proposed course of conduct after the lawyer has explained the material risks and reasonable alternatives.

Requirements for Informed Consent

Consent must be based on a full explanation of:

• The nature of the conflict or potential conflict.
• The possible effects on the lawyer’s representation.
• The reasonably available alternatives.
• The consequences if a dispute arises later.

Consent must be confirmed in writing by each client.

Aggregate Settlements

When representing multiple clients in a matter that settles as a group (aggregate settlement), the lawyer must:

• Disclose the existence and terms of the settlement, including the share each client will receive or pay.
• Obtain each client’s informed consent in writing after full disclosure.

Key Term: Aggregate Settlement
A single settlement or plea agreement involving two or more clients represented by the same lawyer, requiring disclosure and written consent from each client.

Worked Example 1.1

Three passengers injured in a bus accident hire the same lawyer to pursue claims against the bus company. The company offers a lump sum to settle all claims. What must the lawyer do before finalizing the settlement?

Answer:
The lawyer must disclose the total settlement amount, how it will be divided, and all relevant terms to each client. The lawyer must obtain each client’s informed consent in writing before accepting the settlement.

Revocation of Consent and Withdrawal

Clients may revoke consent to joint representation at any time. If this occurs, the lawyer may need to withdraw from representing all clients in the matter, unless circumstances allow continued representation of one client without using confidential information from the other.

Key Term: Withdrawal
The process by which a lawyer ceases to represent a client, often required when a conflict becomes unwaivable or consent is revoked.

Worked Example 1.2

A lawyer represents two business partners in forming a company. A dispute arises, and one partner revokes consent to joint representation. What must the lawyer do?

Answer:
The lawyer must withdraw from representing both partners in the matter, unless the circumstances allow continued representation of one partner and the other gives informed consent, confirmed in writing.

Limits on Waiver and Non-Consentable Conflicts

Some conflicts cannot be waived, even with consent. If the lawyer cannot reasonably believe she can represent all clients competently and diligently, or if the representation involves one client asserting a claim against another in the same proceeding, joint representation is prohibited.

Exam Warning

On the MPRE, be alert for questions where a lawyer represents multiple clients with conflicting interests but fails to obtain informed consent in writing. Oral consent is never sufficient.

Revision Tip

Always check whether the lawyer has explained all material risks and alternatives to each client and obtained written consent before proceeding with joint representation.

Key Point Checklist

This article has covered the following key knowledge points:

• A current-client conflict exists with direct adversity or material limitation between clients.
• Joint representation requires reasonable belief in competent, diligent representation and informed consent, confirmed in writing.
• Consent must be based on full disclosure of risks, alternatives, and consequences.
• Aggregate settlements require disclosure of all terms and written consent from each client.
• Revocation of consent may require withdrawal from representing all clients.
• Some conflicts cannot be waived, even with consent.

Key Terms and Concepts

• Current-Client Conflict
• Direct Adversity
• Material Limitation
• Joint Representation
• Informed Consent
• Aggregate Settlement
• Withdrawal