Referral of Person Adverse to a Client to Another LawyerWhen 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.
The Rules of Professional Conduct
In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not:
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).
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.
Adopted: December 2004