Advance Waivers of Conflicts of Interest
(Opinion 309, which was discussed in the Jan. 2002 “Legal Ethics” column, addresses waivers of conflict of interest and the circumstances in which the waiver is allowed and disallowed. Rules 1.6,1.7,1.9, 1.10,and 2.2 are resorted to as authoritative.)
The Ethics Committee has been asked whether advance waivers of conflicts of interest1 are permissible and, if so, whether there are requirements for such waivers additional to, or different from, those prescribed by Rules 1.7 and 1.9 for waivers generally. For purposes of this opinion, the term “advance waiver” means one that is granted before the conflict arises and generally before its precise parameters (e.g., specific adverse client, specific matter) are known.
The District of Columbia Rules of Professional Conduct (“D.C. Rules”) prescribe the conflicts of interest that prevent a lawyer from accepting and, in some instances, continuing, a representation. D.C. Rules 1.7, 1.9. Where the conflict involves two current clients, a lawyer may not advance adverse positions on behalf of those clients in the same matter. D.C. Rule 1.7(a). That conflict is not waivable. See id., comments -, .
Rule 1.7(b) sets out four types of current-client conflicts that may be overcome by a waiver…
A conflict under Rule 1.7(b) may be waived … “if each potentially affected client consents to such representation after full disclosure of the existence and nature of the possible conflict and the possible adverse consequences of such representation.” D.C. Rule 1.7(c). “Consent is “a client’s uncoerced assent to a proposed course of action, following consultation with the lawyer regarding the matter in question.” D.C. Rules, Terminology, ¶ . In turn, “consultation” means “communication of information reasonably sufficient to permit the client to appreciate the significance of the matter in question.” Id. ¶ . A waiver must be predicated upon disclosure sufficient to allow the client to make “a fully informed decision” and to make the client “aware of the possible extra expense, inconvenience, and other disadvantages that may arise if an actual conflict of position should later arise and the lawyer be required to terminate the representation.” D.C. Rule 1.7, comment … A conflict of interest under Rule 1.9 (former client) also may be waived. D.C. Rule 1.9, comment . Such a waiver is valid “only if there is disclosure of the circumstances, including the lawyer’s intended role in behalf of the new client.” Id. That is, the Rules require that a client who is asked to waive an actual or potential conflict have an adequate appreciation of what protection she is giving up. This requirement is subjective, meaning that more explanation may be required to satisfy the Rules’ consent and consultation criteria where a less sophisticated client is involved than where a more sophisticated client is being asked to waive its rights. See D.C. Rule 1.7, comment ; ABA Opinion at 170.
…The D.C. Rules … permit a lawyer to seek a waiver even though the representation reasonably may be expected to affect adversely the relationship with the other client. D.C. Rule 1.7(b)(2)-(3), 1.7(c). We nevertheless believe that a prudent lawyer in this jurisdiction should revisit the issue when a conflict actually arises, so as to ensure that adequate disclosure will be made to the new client from whom a contemporaneous waiver of conflicts is being sought, see ABA Formal Op. 99-415, and that the lawyer is satisfied that she will be able to represent both clients adequately.
(T)he modern view—held by the courts, the American Bar Association, local bar associations and the American Law Institute—is that advance waivers of conflicts of interest are permissible, within certain limits and subject to certain client protections. We conclude that the D.C. Rules are consistent with that view and that they permit advance waivers under Rules 1.7 and 1.9…
Such waivers, however, are permissible only if the prerequisites of
the D.C. Rules—namely “full disclosure of the existence
and nature of the possible conflict and the possible adverse consequences
of such representation”—are satisfied. See D.C. Rule 1.7(c).
As noted above, the client must have “information reasonably
sufficient to permit the client to appreciate the significance of the
matter in question,” D.C. Rules, Terminology, , and to allow
the client to make “a fully informed decision” with awareness
“of the possible extra expense, inconvenience, and other disadvantages
that may arise if an actual conflict of position should later arise
and the lawyer be required to terminate the representation.”
D.C. Rule 1.7, comment ; … Ordinarily this will require that
either (1) the consent is specific as to types of potentially adverse
representations and types of adverse clients (e.g., a bank client for
whom the lawyer performs corporate work waives the lawyer’s representation
of borrowers in mortgage loan transactions with that bank) or (2) the
waiving client has available in-house or other current counsel independent
of the lawyer soliciting the waiver.
Further, the lawyer must make full disclosure of facts of which she is aware, and hence cannot seek a general waiver where she knows of a specific impending adversity unless that specific instance also is disclosed. See D.C. Rule 1.7, comment  … A corollary of this rule is that if the lawyer cannot disclose the adversity to one client because of her duty to maintain the confidentiality of another party’s information, the lawyer cannot seek a waiver and hence may not accept the second representation. D.C. Rule 1.7, comment  …
A conflict arising from the lawyer’s appearance on both sides of the same matter is, as noted above, nonwaivable. D.C. Rule 1.7(a) & comment . Because of the greatly increased potential for misuse of client confidences—inadvertently or otherwise—advance waivers should exclude from their coverage not only the same matter but also any substantially related matter. … For this reason, advance waivers ordinarily will not come into play in former-client situations under Rule 1.9 because disqualification under that rule extends only to matters that are the same as, or substantially related to, the initial matter.
Further, although the D.C. Rules do not require that waivers be in writing, D.C. Rule 1.7, comment , we join the ABA Committee on Ethics and Professional Responsibility in recommending that—for the protection of lawyers as well as clients—advance waivers be written. See ABA Opinion at 173. We note in this connection that the ABA Ethics 2000 Commission has proposed that the Model Rules require all waivers to be written. …
Finally, any decision to act on the basis of an advance waiver should be informed by the lawyer’s reasoned judgment. For example, a prudent lawyer ordinarily will not rely upon an advance waiver where the adversity will involve allegations of fraud against the other client or is a litigation in which the existence or fundamental health of the other client is at stake.
In accordance with the foregoing, a client not independently represented by counsel (including in-house counsel) generally may waive conflicts of interest only where specific types of potentially adverse representations or specific types of adverse clients are identified in the waiver correspondence. A client that is independently represented by counsel generally may agree to waive such conflicts even where the specificity requirements set out in the preceding sentence are not satisfied.