Ethics Opinion 326
Referral of Person Adverse to a Client to Another Lawyer
When a lawyer is approached by a potential client about a representation adverse to an existing client, after declining the case, the lawyer may refer the potential client to another lawyer.
- Rule 1.3 (Diligence and Zeal)
- Rule 1.4 (Communication)
- Rule 1.6 (Confidentiality of Information)
- Rule 1.7 (Conflict of Interest: General Rule)
- Rule 4.3 (Dealing with Unrepresented Persons)
A lawyer is approached by a person seeking representation in a matter adverse to a party with whom the lawyer has an on-going lawyer-client relationship. After declining the representation, may the lawyer refer the person to another lawyer?
Lawyers frequently decline representations but suggest the names of other lawyers who might represent the potential client. For example, a lawyer who is approached by a person seeking to write a will might refer that person to another lawyer or other lawyers who have expertise in trusts and estates law that the referring lawyer lacks. A lawyer who represents a client in a grand jury investigation might refer another person who has been subpoenaed to testify before the grand jury to another lawyer or other lawyers to avoid a possible conflict of interest. But what are a lawyer’s obligations when approached by a person who wants to sue an existing client? We assume, for purposes of this opinion, that the lawyer would decline the representation.1 May the lawyer recommend another lawyer or a list of lawyers to the person who wishes to sue her client?2
The Rules of Professional Conduct
The District of Columbia Rules of Professional Conduct do not speak directly to this situation. Nor have we been able to find authority from other jurisdictions directly on point. Two Rules seem to be relevant indirectly. First, Rule 4.3 provides:
In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not:
(a) give advice to the unrepresented person other than advice to secure counsel, if the interests of such person are or have a reasonable possibility of being in conflict with the interests of the lawyer’s client . . . .
Rule 4.3(a) contemplates a different situation than the inquiry under consideration, namely that the lawyer is already representing a client in a matter potentially adverse to the unrepresented person. The inquiry presumes either that the matter has not yet been initiated or that the lawyer does not represent the existing client in that particular matter.3 Nor does the Rule address whether it is appropriate for the lawyer to recommend a specific lawyer or list of lawyers whom the unrepresented person might engage as opposed to advising the person that he needs to engage (unspecified) counsel. We can, however, distill from Rule 4.3(a) that a lawyer is permitted to advise an unrepresented person, adverse to her client, to retain counsel even though her client might gain a tactical advantage if the person remained unrepresented. Lawyers frequently give this advice and tell persons potentially adverse to their clients that they ought to engage counsel.
Rule 1.3 is also tangentially relevant. In addition to the requirement that a lawyer represent her client zealously and diligently within the bounds of the law, Rule 1.3(a) provides that "A lawyer shall not intentionally: . . . (2) prejudice or damage a client during the course of the professional relationship." The requirement that a lawyer not damage a client does not mean, however, that the lawyer must press for every conceivable tactical advantage. Comment  to Rule 1.3 provides that the duty of zealous representation does not require a lawyer to press for every advantage that might be realized for a client. Moreover, zealous representation must at times be tempered by the lawyer’s obligation to the administration of justice. In fact, certain conduct that might arguably prejudice a client’s case is mandatory under the Rules such as the requirement in Rule 3.3(a)(3) that the lawyer disclose adverse and dispositive legal authority adverse to the client’s position, if her opponent overlooks it.
Recommending that an adverse person retain counsel does not constitute damage or prejudice to a client within the meaning of Rule 1.3(a). Rule 4.3(a) specifically permits such a recommendation. In the situation under inquiry, where the person has already determined to engage counsel prior to approaching the lawyer, such general advice would be superfluous. We do not believe that the further step of recommending a specific lawyer or list of lawyers prejudices the referring lawyer’s existing client. We assume that in making such a referral, the lawyer will act in good faith and will recommend competent and independent counsel. First, the person would almost certainly find a lawyer even in the absence of a recommendation. Second, it would be mere speculation to conclude that the lawyer that the person might find on his own would not be as competent as the one recommended by the conflicted lawyer. The lawyer could be as good, better, or not as good as the one that the conflicted lawyer might recommend. Moreover, we cannot assume that it is disadvantageous to the referring lawyer’s existing client for its adversary to be represented by competent counsel. Competent opposing counsel is likely in many cases to contribute to reaching a reasonable resolution of the dispute.
More basically, inherent in our adversary system is the principle that persons ought to be represented by competent lawyers and that disputes ought to be resolved on their merits. Assisting a person to obtain competent representation is entirely consistent with that principle. Once the issue is joined, a lawyer can and should take whatever lawful and ethical measures that are required to vindicate her client’s position. Assisting an adversary to obtain competent representation, so that the issue can be joined, is not inconsistent with that duty. It is consistent, however, with the lawyer’s obligation to the administration of justice. At times, the interests of the legal system and the public interest may prevail over that of the client, e.g., Rule 3.3(a)(3). We believe that recommending competent counsel to an unrepresented person, can never constitute prejudice to a client within the meaning of Rule 1.3(a).
There are, however, some practical considerations to recommending counsel to a potential adversary of a lawyer’s client. First, will the person trust the recommendation? Second, while the principles that underlie our adversary system may permit such a recommendation, some clients may not understand why their lawyer assisted an adversary to obtain counsel to sue them. Thus, as a matter of client relations, a lawyer may prefer not to make such a recommendation. Moreover, a prudent lawyer who elects to make a recommendation might be wiser to suggest more than one name to avoid recriminations from the inquirer, should the recommended lawyer prove unsatisfactory, or from her client, should the recommended lawyer turn out to be vexatious.4
The practical consideration relating to two other Rules merit discussion. There is always the possibility that in discussions with a potential client, a lawyer may learn confidences or secrets that the person does not want revealed.5 If the lawyer does learn of these confidences or secrets and then realizes that the potential client is adverse to an existing client, she faces a dilemma: Under Rule 1.4, which concerns the lawyer’s obligation to communicate with clients, she may have an obligation to inform her existing client that someone intends to sue it. In some circumstances the failure to inform the existing client could be damaging. Suppose, for example, the potential client seeks to bring a sexual harassment claim against her employer, an existing client, because of an on-going hostile environment. The client should want to know this as soon as possible so that it could investigate and if necessary remediate the situation. On the other hand, the potential client might not want to disclose to the lawyer’s existing client that she is contemplating a lawsuit. Comment  to Rule 1.6, which prohibits, in general, the disclosure of confidences and secrets, makes it clear that the lawyer’s duty of confidentiality attaches when the lawyer agrees to consider whether to take on a client. "Thus, a lawyer may be subject to a duty of confidentiality with respect to information disclosed by a client to enable the lawyer to determine whether representation of the potential client would involve a prohibited conflict of interest . . . ." Presumably, most lawyers ascertain at the outset the name of the adverse party prior to discussing with a potential client a new matter. But if a lawyer neglects to do so or if a lawyer, particularly in a large firm, does not recognize at the outset that the adversary is a firm client, the lawyer may be seized with confidential or secret information.6
Under those circumstances, the specific obligation under Rule 1.6 not to reveal those confidences and secrets trumps the more general Rule 1.4 obligation to keep clients informed. Nevertheless, a lawyer who must refrain from telling her client information that the client would wish to know - even if the only "secret" was the potential client’s contemplated suit - might hesitate before taking the steps of actually recommending counsel to the inquiring person. Many clients might find it difficult to understand that their lawyer not only failed to tell them they were about to be sued, but also recommended counsel to file that suit.
In sum, we believe that it is consistent with a concept of our adversary system, and not prohibited by the Rules of Professional Conduct, for a lawyer, if she chooses, to refer a person seeking representation to another lawyer, even if the representation would be adverse to the referring lawyer’s existing client. Each lawyer must decide for herself whether under the particular circumstances this is a wise thing to do.
1. Rule 1.7 generally prohibits the lawyer from accepting such a representation. It is possible, of course, for the lawyer to seek a waiver from the existing client (and the potential client) under Rule 1.7 and sue her client, if that existing client were represented by another lawyer in the matter.
2. The most likely scenario is that the lawyer is approached by a potential plaintiff. She could also be approached by a defendant, already sued by her client who is represented by another lawyer in the matter. Presumably similar situations might arise in a non-litigation context such as a potential client who wants to retain counsel to represent him in a business transaction with the lawyer’s existing client. In a non-litigation context, where the adversarial relationship is less stark, the existing client is less likely to be offended by its lawyer’s referral of the potential client to another lawyer.
3. If the lawyer represents the client in a matter already initiated, presumably the unrepresented person would not seek to engage the lawyer representing his adversary.
4. It may not always be possible to recommend more than one lawyer. For example, if the person is seeking pro bono counsel, furnishing a list of names may be impractical.
5. We assume that the lawyer discovers the conflict before forming a lawyer-client relationship. Whether such a relationship has been formed is a matter of substantive law. Comment  Rule 1.6. See ABA Formal Op. 95-390 (citing Restatement (Third) of the Law Governing Lawyers § 26 (Tent. Draft No. 5 1992) for the indicia of when a lawyer-client relationship arises.
6. Under some circumstances, disclosure of confidential information by a potential client that might be useful to the representation of an existing adverse client, might disqualify the lawyer from representing the existing client in the matter adverse to the potential client. Comment , Rule 1.10. See N.Y. Eth. Op. 643, 1993 WL 57240 (N.Y. St. Bar Assn. Comm. Prof. Eth.) (a confidence revealed in an intake interview of prospective client relevant to representation of existing client requires withdrawal from existing representation and separate lawyers for each client.) Fl. Eth. Op. 92-1, 1992 WL 602798 (Fla. St. Bar Assn.) (presuming confidential information is always obtained in Legal Aid intake interview). A conflict obtained as a result of learning confidential information in deciding whether to enter into a representation is not imputed to other associated lawyers when no lawyer-client relationship is formed. Rule 1.10(a) and Comment .