|Members Present |
Alice Senechal, Chair
Judge Karen Braaten
|Members Absent |
Chair Senechal called the meeting to order at 10:00 a.m. and welcomed as a new member Barbara Perry Cichy, Professor of Speech at Bismarck State College, who was recently appointed by the SBAND Board of Governors as one of the Committee's lay members. She then drew Committee members' attention to Attachment B (February 21, 2003) - minutes of the November 15, 2002, meeting.
It was moved by Randy Lee, seconded by Sandi Tabor, and carried unanimously that the minutes be approved.
Chair Senechal explained that the lawyer assistance proposal reviewed at the last meeting was submitted to the Board of Governors, which, after review and discussion, approved the proposal. She then drew attention to Attachment C (February 21, 2003) - a revised draft enabling rule regarding a lawyer assistance program and revised draft amendments to Rule 8.3, Rules of Professional Conduct.
Staff briefly reviewed the draft rule and the changes resulting from the Committee's discussion at the November 2002 meeting. Specifically, he said, the draft was modified to delete references to the state bar association and board member. The draft was also modified, he said, to include in Section 4 (Confidentiality) general language (italicized) permitting the disclosure of information if considered necessary to prevent the commission of an act believed likely to result in imminent death or imminent substantial bodily harm. He said the general language, taken from Rule 1.6(a), was considered preferable to the reference to the rule incorporated in the earlier draft.
With respect to Section 5 concerning immunity from suit for those participating in an assistance program, Sandi Tabor wondered whether the Supreme Court has the authority to grant immunity by rule. She noted that substantive law issues, such as immunity, are generally considered the proper subject matter of statutes, while the Supreme Court is empowered to address procedural matters by rule. Staff said Section 5 in the draft is generally patterned after the immunity provision in Rule 6.5 of the Rules for Lawyer Discipline, which was previously adopted by the Supreme Court. Randy Lee recalled that when the lawyer discipline rules were developed and revised, a similar discussion occurred about the authority of the Supreme Court to provide immunity for those involved in the discipline process. He said the early conclusion was that it would likely be "cleaner" if the Supreme Court were to conclude, in an appropriate case, that immunity was appropriate. But, he said, delaying development of rules while waiting for a possible decision was considered unsatisfactory because of the concern that lawyers would be deterred from participating in the discipline process for fear of possible liability. Christine Hogan noted there is caselaw in other states to the effect that rules of professional conduct have the force of law.
Mike Williams observed that Section 4 regarding confidentiality permits disclosure of information if considered necessary to prevent imminent death or substantial bodily injury, while Rule 1.6(a) requires disclosure under those circumstances. He asked whether Section 4 should be consistent with the mandatory disclosure provided for under Rule 1.6(a). Randy Lee observed that some of those involved in the assistance program will not be lawyers. Lawyers, he said, would be required to disclose information if that information were to arise during the lawyer-client relationship. Lawyers participating in the assistance program, he said, would not be in a lawyer-client relationship. Consequently, he said, there may be a logical basis for requiring disclosure in the one situation, while permitting it in the other. He noted as well that the Committee would be reviewing changes made to Rule 1.6(a) as a result of the Ethics 2000 report. He said depending upon what the Committee concludes is to be done with North Dakota's Rule 1.6(a), there may be a need to review again the draft language in Section 4 of the enabling rule.
Loralyn Hegland asked whether the Committee has considered development of guidelines to be used by inquiry committees when deciding whether diversion or referral to an assistance program is appropriate. Chair Senechal said the Committee has not yet considered that particular topic, but will review possible amendments to the Rules for Lawyer Discipline regarding the role lawyer assistance and diversion might play in the discipline process.
Rule 8.3 Amendments
Staff reviewed the revised draft amendments to Rule 8.3 of the Rules of Professional Conduct as contained in Attachment C (February 21, 2003). Staff said the only changes are the deletions of references to state bar association and board member and the inclusion of a reference to the yet to be determined administrative (enabling) rule for the assistance program.
Randy Lee suggested, and Committee members agreed, the references to "lawyer's" assistance program on lines 16 and 22 of the second page should be changed to "lawyer" assistance program.
Draft Rule Changes Regarding Lawyer Assistance and Diversion
Alice Senechal explained that Attachment D (February 21, 2003) was developed with the assistance of Judge Braaten and Jim Hill and attempts to identify various rules that might require modification to implement an assistance program and diversion from discipline. She said the draft revisions are simply early starting points for discussion and may require additional modification as Committee review proceeds. Committee members then turned to a review of the various amendments.
Alice Senechal said the draft amendments to Rule 1.0 of the Rules for Lawyer Discipline would provide definitions for "diversion from discipline" and "lawyer assistance program."
Mike Williams wondered whether a restriction or guideline should be included in the lawyer assistance program definition to indicate when participation in an assistance program would not be an appropriate alternative. Elaine Fremling suggested such a substantive qualification might better be placed in a separate provision since a definitional section is generally used simply to define operative words.
Sandi Tabor agreed, however, there should be some direction or guideline regarding when lawyer assistance or diversion is appropriate. She said her concern is that, without guidelines, some may seek to exploit lawyer assistance or diversion as a way of circumventing the discipline process.
Judge Braaten agreed with the need for standards regarding when lawyer assistance or diversion is considered an appropriate alternative. She said one possibility may be for the rules to establish the outer boundaries regarding kinds of conduct for which diversion would be inappropriate, but leave some flexibility for the assistance committee.
Staff noted that in its earlier discussion of diversion, the Committee reviewed a draft diversion rule that listed several kinds of misconduct for which diversion from the discipline process would not be appropriate.
Randy Lee said a complicating factor in resolving the diversion vs. discipline discussion is that those who support and work with lawyer assistance programs would suggest the determination of who can benefit from the program is based not on what the lawyer has done, i.e., misconduct, but whether the lawyer's behavior can be successfully changed. The consequence, he said, is the general premise that the misconduct should not, or does not, have anything to do professionally with whether a lawyer should be admitted to the program. On the other hand, he said, the Committee is charged with helping the Supreme Court protect the public through the development of rules of professional conduct and discipline that establish a system in which the public can have confidence. As a result, he said, the Committee's previous discussions have indicated a reluctance to consider a diversion process without clear limitations. He suggested that, rather than list kinds of misconduct that would disqualify a lawyer's participation in diversion, perhaps a rule could provide that if the alleged misconduct, if true, would be grounds for suspension or disbarment, then the lawyer would not be eligible for diversion. The problem, he said, is that at the outset there may be very little actually known about the nature of the alleged misconduct.
Bob Udland said that from the standpoint of a inquiry committee member, it would be helpful to have general limitations such as those previously reviewed by the Committee. He suggested the limitations could be supplemented by providing that the inquiry committee would also have the general authority to reject diversion as an alternative when that is considered appropriate.
Sandi Tabor said it may be worthwhile to permit referring a lawyer to an assistance program as part of imposed discipline.
In response to a question from Chair Senechal, Committee members agreed staff would prepare draft amendments to the Rules for Lawyer Discipline to identify, as general limitations, the kinds of misconduct for which diversion would not be available.
Committee members next reviewed draft amendments to Rule 2.4E(3) and (4) of the Rules for Lawyer Discipline concerning inquiry committee authority and duties. Randy Lee noted that the draft language for paragraph (4) requires, in part, the inquiry committee to dismiss the complaint after the lawyer's successful completion of participation in an assistance program. He said that will run counter to the suggestion that it should be possible for a lawyer to be referred to an assistance program even as part of imposed discipline. Alice Senechal observed that if discipline were imposed, then the inquiry committee likely will not have approved diversion. Sandi Tabor said the inquiry committee could, however, order participation in an assistance program as a form of discipline.
Staff suggested the possibility of adding a new paragraph to Section E to provide that the inquiry committee "shall", in circumstances deemed appropriate by the inquiry committee, direct the respondent to participate in a lawyer assistance program either alone or in conjunction with any form of discipline available to the committee.
Elaine Fremling suggested paragraph (4) could be separated into two provisions, one regarding dismissal of the complaint after successful completion of an assistance program and the other regarding discontinuing diversion if the lawyer fails to successfully participate in an assistance program. Randy Lee agreed but suggested that paragraph (4) should be further modified to refer to dismissal of the complaint after successful "diversion to" participation in an assistance program. He cautioned against dismissal occurring after simply completing the assistance program even though discipline, if also imposed, is ongoing during the lawyer's participation in the program
Alice Senchal recalled that the Committee had previously discussed the need for an individualized lawyer assistance plan, whether or not as part of a diversion situation, and the need to have that plan approved by the lawyer assistance committee. She said a reference to that requirement should probably be included in the rules at some point.
Christine Hogan suggested the definition of "diversion from discipline" (Rule 1.0 amendments) should be modified to simply refer, in relevant part, to "participation in the lawyer assistance program", rather than to successful participation. She said paragraph (4) in Rule 2.4E could then be modified to refer to dismissal of the complaint after "successful participation in a diversion from discipline", rather than to "successful completion of participation" in a lawyer assistance program. The latter reference, she said, is not needed since diversion is defined as participation in a lawyer assistance program. Additionally, she said, dismissal would then hinge on successfully participating in diversion, rather than successfully completing participation in an assistance program.
Bob Udland said he favored deleting the reference to "successful" participation because the lawyer will either complete the program or not and the program will likely be defined by an agreement with the lawyer. The lawyer assistance committee, he said, will have to decide whether the lawyer completed the program.
Alice Senechal wondered whether the lawyer's participation or completion should be explicitly linked to the plan or agreement approved by the assistance committee or relevant disciplinary entity.
Following further discussion, it was moved by Judge Braaten, seconded by Bob Udland, and carried unanimously that paragraph (4) of Rule 2.4E be modified to refer, in part, to dismissal of the complaint after successful completion of all conditions of diversion and that the reference to "successful" be deleted from the definition of "diversion from discipline".
It was moved by Elaine Fremling, seconded by Judge Bratten, and carried unanimously that paragraph (4) of Rule 2.4E be separated, with a subsequent new paragraph (5) referring to discontinuing diversion from discipline if a lawyer does not successfully complete all conditions of diversion.
Committee members agreed an additional paragraph should be added providing additional authority for the inquiry committee to direct, in circumstances deemed appropriate by the committee, that the lawyer participate in a lawyer assistance program either alone or in conjunction with any form of discipline available to the committee.
Alice Senechal next reviewed the draft amendments to Rule 3.1C, which would permit the inquiry committee chair or vice-chair to refer a lawyer to the assistance program even if the complaint is summarily dismissed.
Sandi Tabor wondered about the authority to refer a lawyer to an assistance program if the complaint has been summarily dismissed. Judge Braaten said the intent was to assure that inquiry committees could suggest participation in an assistance program. Sandi Tabor responded that if the complaint has been dismissed, the lawyer would not be obliged to participate in the program. Judge Braaten agreed the lawyer would not be compelled to participate, but the lawyer might nevertheless consider it prudent to consider the committee's suggestion. Sandi Tabor doubted such would be the case.
Randy Lee said the suggested language may be a reflection of an early sentiment that it may be useful for the inquiry committee, as the first interface between the discipline system and a lawyer who may have problems, to be able to alert the lawyer that there is concern about the direction in which the lawyer might be headed, i.e., "finger-shaking".
Bob Udland observed that it may be better to provide that the chair or vice-chair may suggest that the lawyer participate in the assistance program. He said his first interpretation of the "may refer" language in the draft was that the lawyer would actually be sent to an assistance program.
Loralyn Hegland noted that inquiry committees have ceased any kind of finger-shaking or written suggestions to respondent lawyers. Judge Braaten said if that is the case, then it may be doubly important to clarify that an inquiry committee can suggest or refer a lawyer to an assistance program to address issues that may become the subject of future discipline actions.
Loralyn Hegland explained that the basis for summary dismissal is a conclusion that, even if the allegations were true, there would be no violation of any rule of professional conduct. She said the lawyer is not required to respond and an investigation is not conducted with respect to complaints that are summarily dismissed. Consequently, she said, there is simply an allegation with no evidence, which may be a questionable basis from which to suggest that the lawyer participate in an assistance program for a possible problem.
Dan Crothers said he is concerned about bringing diversion into play when there is no ongoing discipline. He said diversion before there is any discipline under consideration is akin to a solution in search of a problem.
Christine Hogan wondered whether what is being considered is essentially encouraging the lawyer to self-refer to the lawyer assistance program. Dan Crothers said that approach can occur at any time, but incorporating referral or diversion without finding misconduct will simply invite opposition to the proposal.
It was moved by Judge Braaten and seconded by Tim Priebe that the draft language in Rule 3.1C be modified to provide: "Notwithstanding a summary dismissal, the chair or vice-chair may suggest that the lawyer participate in the lawyer assistance program."
Sandi Tabor asked what procedure is contemplated by the suggested approach. She described as an example a situation in which the inquiry committee chair finds there are no grounds for discipline but there is an allegation that the lawyer may have an alcohol problem. The inquiry committee chair, she said, is then in the position of "suggesting" in a letter to the lawyer that the lawyer participate in the assistance program based simply on allegations that the lawyer has an alcohol problem. That, she said, is a troublesome approach. Bob Udland said an additional complication is that if such a suggestion is placed in the file, there could be serious consequences if there is an inquiry concerning licensure received from another state.
The motion failed.
It was moved by Sandi Tabor, seconded by Randy Lee, and carried unanimously to delete the underscored draft language in Rule 3.1C.
Committee members then reviewed draft amendments to Rule 3.1D(3), which would permit the inquiry committee to refer a lawyer to the assistance program for screening at any time during which a complaint is under consideration and would permit the lawyer to initiate a screening process at any time during which the complaint is under consideration.
In response to a question from Tim Priebe, Alice Senechal said the assistance program under consideration would allow self-referral by a lawyer at any time, whether or not there is a complaint pending.
In response to a question from Sandi Tabor, Alice Senechal said the draft language only addresses referral to the assistance program and not diversion from discipline. Thus, she agreed that if screening indicates the lawyer has a problem and should participate in the assistance program, the inquiry committee could still decline referral to the program and proceed with discipline if that were considered appropriate in light of the alleged misconduct.
It was moved by Tim Priebe, seconded by Sandi Tabor, and carried unanimously that the draft language to Rule 3.1D(3) be accepted as written.
Alice Senechal next drew attention to draft amendments to Rule 3.1D(6), which would add diversion from discipline as a circumstance that would not require notice of the opportunity to appear before the inquiry committee to be provided to the complainant.
Tim Priebe asked whether the lawyer must agree with the lawyer assistance committee and the inquiry committee regarding participation in the assistance program, or whether the lawyer can reject the referral and risk whatever may result from the discipline process. If the lawyer does have the option, he said, then it may be necessary to provide the complainant with an opportunity to appear. Alice Senechal said the lawyer would have to agree to participate before the plan could be approved by the lawyer assistance committee.
Sandi Tabor said there may be a need, at some point, to provide guidance regarding the degree of the lawyer's participation in designing the assistance plan.
With respect to the no notice requirement when diversion is involved, Randy Lee wondered whether there would be some point in the process when the complainant would be informed that the lawyer is being diverted from the discipline process. Alice Senechal said Rule 3.1D(8) provides for notice to the complainant of the disposition of the complaint. Loralyn Hegland said notice would only be provided if diversion occurs after a complaint has been filed by someone. Additionally, she noted that the complainant must be notified of the opportunity to appear if the complaint is investigated.
Randy Lee said the amendment to Rule 3.1D(6) is acceptable as long as the complainant is aware that diversion has occurred.
Bob Udland asked how a decision could be reached regarding diversion without the attorney and the complainant appearing. The written complaint alone, he said, may not be an adequate basis upon which to make the decision.
Dan Crothers explained that if an investigation indicates there likely will be no sanction imposed for the alleged misconduct, then the lawyer is not afforded an opportunity to appear. Additionally, he said the process under discussion seems to contemplate imposing the current disciplinary procedure on the manner in which a decision regarding diversion is reached. Specifically, he said, it is troubling that the process being reviewed suggests a lawyer could be referred to an assistance program even though there has been no misconduct for which a sanction could be imposed. He cautioned that the Committee should be aware of all the various steps in the process and the problems associated with simply piggybacking a diversion decision on the present process.
Sandi Tabor said that at some point in the process all those involved must come to the table to consider whether diversion in a particular case is appropriate. Reaching the decision based only on the paper complaint, she said, is likely not a satisfactory approach. She suggested one approach might be for the lawyer to be screened to determine if the assistance may be appropriate. If the assistance committee concludes assistance may be necessary, she said, there could then be an opportunity for the lawyer and the complainant to appear before the inquiry committee to discuss the option of diversion.
It was moved by Sandi Tabor and seconded by Dan Crothers that the underscored amendment to Rule 3.1D(6) be deleted.
Dan Crothers said his second was for purposes of discussion and suggested the need for something to be stated regarding notice. Sandi Tabor agreed but said there should be a discussion of how, practically and procedurally, decisions regarding assistance and diversion should be reached and then rules could be amended to facilitate that process.
Dan Crothers reiterated that if a sanction will not be imposed as the result of a complaint, then the lawyer will not appear before the inquiry committee unless the lawyer is required to appear for purposes of determining participation in an assistance program. That process, he said, in essence creates a separate dispositional track for the inquiry committee.
Tim Priebe wondered whether the new language to paragraph (6) is needed. Perhaps, he said, it would be better to review paragraph (7), which describes when notice must be provided, and consider requiring notice to be provided when the inquiry committee is reviewing diversion as an alternative.
Loralyn Hegland expressed concern for the additional workload for inquiry committees with respect to deciding whether diversion is appropriate. As an alternative, she said, the committees could determine, as they always have, whether there is sanctionable conduct and then, additionally, if there is an issue regarding lawyer assistance. If, she said, the inquiry committee determines lawyer assistance may be an issue, then the matter could be sent to the lawyer assistance committee for review and conclusion whether assistance is appropriate and can be provided.
Sandi Tabor said that may be a workable approach, particularly if there is a "list" of kinds of misconduct for which diversion would not be available. There could be, she said, a process in which, if the allegations are sufficient to suggest the need for screening, an opinion is sought from the assistance committee on whether diversion, for example, would be appropriate. The inquiry committee, she said, could then direct that the assistance committee develop a plan for submission to the inquiry committee.
In response to the general discussion, Alice Senechal and Judge Braaten said they would develop a procedural flowchart describing the process with respect to diversion issues.
With the consent of the second, the motion was withdrawn.
Christine Hogan suggested that the draft language in paragraph (6) is likely unnecessary, but that a reference to diversion should be included in paragraph (7).
As a general matter for consideration, Sandi Tabor asked whether the responsibilities of the lawyer assistance program are clear. For example, she said there are a number of potential problem areas, such as law office mismanagement, that are different from those associated with alcohol or substance abuse. Randy Lee noted that the draft enabling rule had been modified to refer generally to any kind of problem that may adversely affect a lawyer's performance. Sandi Tabor said a question of resources may arise depending on how broadly lawyer assistance is defined.
Alice Senechal said she and Judge Braaten will revise the draft rule amendments and develop a flowchart for review at the next meeting.
Overview of Tentative Amendments to Rules 1.2 - 1.5
Staff distributed and reviewed amendments to Rules 1.2 through 1.5 tentatively approved by the Committee at its November 15, 2002, meeting. He noted that the Committee had reserved consideration of Comment amendments until a later time. A copy of the amended rules is attached as Appendix A.
Randy Lee drew attention to the change, in Rule 1.2(c), from the reference to objectives of the representation to scope of representation. He noted that Rule 1.2(a), as modified, provides that "subject to paragraph (c)", which now refers to scope of representation, the lawyer must abide by the client's decision concerning the objectives of representation. He suggested there may now be a conflict between the two references, if they are intended to have different meanings.
It was moved by Dan Crothers that Rule 1.2(a) be modified to replace the reference to "objectives" with " scope".
Staff noted that previous discussion drew a distinction between "objectives", which were the concern of the client, and "scope", which concerns a decision by the lawyer regarding the level or kind of representation provided. In that regard, he said, the references in the amended rule may make sense. Randy Lee said there still may be an incongruity because paragraph (a) would subject the client's decisions concerning "objectives" to the lawyer's possible limitation of the "scope" of representation under paragraph (c).
The motion died for lack of a second.
Elaine Fremling suggested paragraph (c) concerning the scope of representation should perhaps precede current paragraph (a), which concerns objectives. It would seem, she said, that a decision would first be made concerning the scope of the lawyer's representation, and then the client's objectives would be considered. Sandi Tabor observed that, as currently modified, paragraph (c)implies, through the consent provision, that the client has some role in determining the scope of the lawyer's representation. That, she said, would seem inappropriate.
Bob Udland offered the example in which a client wants a firm to incorporate a business and do the tax work, but the firm is willing to handle only the business incorporation. The client, he said, will, in fact, have to make a decision concerning whether the firm will be retained for that limited purpose. In that regard, he said, the client is involved in "consenting" to the scope of representation.
Following further discussion, Dan Crothers agreed to review the Rule 1.2 amendments and offer an assessment at the next meeting concerning the relationship between objectives and scope of representation.
Rule 1.6 ( Confidentiality) - Review
Randy Lee distributed and reviewed his comparison and analysis of North Dakota Rule 1.6 (Confidentiality) and new Model Rule 1.6. He noted that the model rule resulting from the Ethics 2000 process is now more similar to North Dakota's rule than the predecessor model rule. A copy of his report is attached as Appendix B.
Randy Lee suggested there is good reason not to follow the approach in new Model Rule 1.6, which, most importantly, would require removing paragraph (d) from North Dakota's current rule. That provision permits a lawyer to reveal protected information if the lawyer reasonably believes disclosure is necessary to prevent the client from committing a criminal or fraudulent act that may result in non-imminent death or substantial bodily harm, or substantial injury or harm to the financial interests or property of another. In addition, he said, there remains a difference between North Dakota Rule 1.6(a) and the model rule with respect to whether disclosure is required (North Dakota) or permitted (model rule) when there is a possibility of imminent death or substantial bodily harm. He suggested there is likely little support for changing North Dakota's "required disclosure" provision. He noted that the model rule also no longer refers to an "act" committed by a "client". Rather, the model rule permits disclosure "to prevent reasonably certain death or substantial bodily harm". Disclosure, he said, is therefore not limited to an act, and is extended to anything that may prevent death or bodily harm.
Randy Lee further explained that the new model rule permits disclosure of protected information to secure legal advice about the lawyer's compliance with ethical rules. There is no like provision, he said, in North Dakota's Rule 1.6.
Following further discussion, it was moved by Randy Lee, seconded by Mike Williams, and carried unanimously that required disclosure under current paragraph (a) of Rule 1.6 be retained but that paragraph (a) be modified to follow the model rule with respect to disclosure necessary to prevent reasonably certain death or substantial bodily harm.
Randy Lee said North Dakota Rule 1.6(b) is largely the same as the new model rule except that the model rule incorporates the concept of informed consent, which the Committee had previously rejected. He recommended no changes to current Rule 1.6(b). He said there is no change in the model rule with respect to Rule 1.6(c). In light of the Committee's action with respect to Rule 1.6(a), he recommended that references to non-imminent death or bodily harm be deleted from Rule 1.6(d). He noted that paragraph (a) would now require disclosure to prevent reasonably certain death or substantial bodily harm. He inquired whether it is necessary to include death or bodily harm in paragraph (d) unless the permission to disclose afforded by that provision relates to death or bodily harm that is something other than "reasonably certain."
Christine Hogan noted that paragraph (a) requires disclosure if it is "reasonably certain" that death or bodily harm might result. Paragraph (d), she said, permits disclosure if the lawyer reasonably believes the client's act is "likely" to result in non-imminent death or substantial bodily harm. She suggested the standards are different enough to justify retaining in paragraph (d) the references to death and bodily harm.
It was moved by Randy Lee, seconded by Mike Williams, and carried unanimously that Rule 1.6(d) be modified to delete references to non-imminent.
With respect to paragraph (f) of Rule 1.6, Randy Lee said the model rule provision is the same and there is no recommended change. He said the model rule does in commentary what paragraph (g) does in the blackletter rule, which would not require any change to the current provision. He said he is uncertain of the reason for current paragraph (h), which permits disclosure of protected information if that information has become generally known, and the model rule does not contain a similar provision.
It was moved by Randy Lee, seconded by Mike Williams, and carried unanimously that paragraph (h) be deleted from current Rule 1.6.
It was moved by Randy Lee and seconded by Tim Priebe that current Rule 1.6 be modified to include the model rule provision permitting disclosure of protected information if necessary to secure legal advice about the lawyer's compliance with ethical rules.
Sandi Tabor said she agrees with the change in principle but is concerned about the balance between the impact of the change and the protection given a lawyer who seeks an advisory opinion from the ethics advisory committee. She said the change may detract from a lawyer's willingness to seek an opinion at the outset. Randy Lee suggested there may be instances in which the lawyer has insufficient time to seek an advisory opinion.
The motion carried unanimously.
Rule 1.7 (Conflict of Interest: General Rule) - Review
Judge Braaten distributed and reviewed her comparison and analysis of North Dakot Rule 1.7 and new Model Rule 1.7. A copy of the report is attached as Appendix C. In summary, she said North Dakota's rule recognizes that there is a possibility of greater impropriety if a lawyer's own interests are involved and, therefore, prohibits representation in those circumstances. The model rule, she said, allows greater latitude for the lawyer to undertake or continue representation if the client's informed consent, in writing, is obtained. She said North Dakota's rule appears clearer and less confusing as to its scope and application than the model rule. She noted, however, that the definition of "matter" under current paragraph (e) may require review. She underscored the model rule's requirement that if a client consents to representation, it must be "informed consent" and obtained in writing.
Sandi Tabor observed that informed consent and a writing requirement need not necessarily be linked, but obtaining a client's consent in writing in conflict situations would likely serve as a protection against potential legal malpractice claims.
Tim Priebe agreed that obtaining the client's consent in writing is preferable, but wondered if not doing so should be considered an ethical violation.
Mike Williams said a writing requirement is essentially a client protection issue, and in that regard he would support adding a writing requirement to the rule. Bob Udland agreed but expressed concern about requiring the client's informed consent.
Randy Lee recalled that the Committee had previously discussed the inclusion in the model rules of the concept of informed consent and had rejected that approach for North Dakota rules.
Sandi Tabor emphasized that if the informed consent requirement is rejected, the reason for doing so should be clearly reflected in the minutes.
Randy Lee drew attention to the Committee's discussion at the November 15, 2002, meeting (page 8 of the minutes), during which the vagaries associated with the concept of informed consent were reviewed. The conclusion reached, he said, was that because of the uncertainties of caselaw interpretation of the concept there would be too many variables to anticipate and the result would be informed consent agreements so lengthy and complex as to be of questionable value to a client. Mike Williams noted letters received from Lolita Romanick and Bradley Beehler, which were previously reviewed by the Committee and which outlined concerns about incorporating the informed consent model in North Dakota's rules [see Attachment J (November 7, 2002)]. Bob Udland drew attention to the recent article by Randy Lee in Law Matters, included in his material for review of Rule 1.9, which considers in greater detail concerns about the informed consent approach.
It was moved by Sandi Tabor, seconded by Bob Udland, and carried unanimously that, in light of the Committee's previous discussion and review of the noted information, the informed consent approach recommended by the Model Rules should not be included in the revison of orth Dakota's Rules.
In response to a question from Chair Senechal concerning any changes to Rule 1.7, it was moved by Randy Lee and seconded by Elaine Fremling that Rule 1.7(c)(2) be modified to include a requirement that the client consent "in writing" after consultation to the lawyer's representation.
In response to a question from Judge Braaten, Randy Lee said the writing requirement contemplates an acknowledgment by the client that representation is acceptable.
The motion carried unanimously.
Mike Williams noted that Rule 1.7(c), with some exceptions, precludes representation if the representation might be "adversely affected", while the model rule precludes representation if the representation will be "materially limited." He said the current standard appears broader in scope and arguably would allow an objection to representation on any number of conceivable grounds, while the "materially limited" standard seems more difficult to prove and might allow a lawyer to represent clients in situations that the current standard may not. Judge Braaten agreed the model rule uses a different standard but said she is uncertain whether one is any clearer in scope than the other.
Bob Udland said he would tend to agree that "adversely affects" seems almost a de minimis requirement, while "materially limiting" is arguably a more demanding standard.
Randy Lee observed that since nearly any conflict is curable under the model rule, there is less concern about what the standard might mean. He said more care is required with respect to the current North Dakota rule because under that rule some conflicts are not curable. He said the "adversely affects" standard is bothersome in that its meaning is not really clear.
Judge Braaten noted the model rule commentary, which explains that a material limitation of representation involves a question of whether a difference in interests "will materially interfere with the lawyer's independent professional judgment in considering alternatives or foreclose courses of action that reasonably should be pursued on behalf of the client." That, she said, is likely a good definition of what is at issue concerning the effect upon representation of a conflict. Randy Lee suggested that whatever standard is used, perhaps that language could be included in the commentary to explain what the standard means. Committee members agreed the definitional language should be considered when the comment to Rule 1.7 is reviewed.
Bob Udland noted that the model rule does address representation of a client that is "directly adverse" to another client, and representation that will be "materially limited" by the lawyer's responsibility to another client. Randy Lee suggested "directly adverse" is still not the equivalent of "adversely affect".
Sandi Tabor said there should be situations in which a conflict is not curable and there are situations in which a client should not be put in the position of consenting to representation when the client may not clearly understand what is being consented to. The challenge, she said, is to articulate what the appropriate standard is, which could be addressed in the comment.
It was moved by Sandi Tabor, seconded by Randy Lee, and carried unanimously that the Committee work within the current format of Rule 1.7 to address the issue.
Judge Braaten observed that the current definition of "matter" in paragraph (e) does not seem to cover transactional matters, such as activities involved in buying or selling a house. Randy Lee said the noted area is the most common riddle in the area of transactional conflicts. He explained that the buyer and seller often want to save money by having the same lawyer, but a lawyer in that situation should be very sensitive to appropriate disclosures and consents.
Judge Braaten suggested substituting "transaction" for "particular matter involving a specific party" in paragraph (e).
It was moved by Judge Braaten, seconded by Mike Williams, and carried unanimously that paragraph (e) be modified in the manner described.
Rule 1.8 (Conflict of Interest : Prohibited Transactions) - Review
Tim Priebe then reviewed Attachment E( February 21, 2003) - his comparison and analysis of North Dakota Rule 1.8 and new Model Rule 1.8. He noted that many of the model rule changes relate to the informed consent concept, which the Committee has declined to follow. He said the next notable possible change would be the inclusion from the model rule of a writing requirement in paragraph (a)(2), which concerns the client consenting to a lawyer entering into a business, financial, or property transaction with the client. Randy Lee noted there are two possible places in paragraph (a)(2) where a writing requirement could be included: requiring written advice to seek independent counsel and requiring that the client's consent be in writing.
It was moved by Tim Priebe and seconded by Mike Williams that paragraph (a)(2) be modified to include a requirement that the client's consent be in writing.
Randy Lee observed that most litigation related to this rule has centered on the issue of whether the lawyer did, in fact, advise the client to seek independent counsel. Tim Priebe said if the client's written consent is required, it is likely that advice to seek independent counsel would be included in that writing also.
It was moved by Tim Priebe and seconded by Mike Williams that the motion be amended to include modification of paragraph (a)(2) to require written advice to seek independent counsel.
After discussion, the amended motion carried unanimously.
Elaine Fremling noted that the model rule requires that the client consent in a writing signed by the client. She said that in the insurance industry all communications are in writing and signed by the client, which serves to underscore that the client was informed in writing. She wondered whether the signing requirement should also be included in paragraph (a)(2). Mike Williams said the consent document would likely contain language to the effect that the client consents and has been advised to seek independent counsel. Bob Udland suggested that if the requirement for a writing signed by the client is included in paragraph (a)(2), then the writing requirement previously included in Rule 1.7, as well as other rules where there may be a writing requirement, should be reviewed to determine whether a client signature should also be required.
It was moved by Elaine Fremling and seconded by Bob Udland that paragraph (a)(2), as modified, be further modified to include a requirement that the client's written consent be signed by the client.
Judge Braaten suggested the client's consent in writing may accomplish the same objective as having the client actually sign a writing. Mike Williams said that when the client consents to the transaction in writing, that implies the client is responsible for signing the document. Elaine Fremling noted that when an insurance contract is delivered to a client, the contract is accompanied by a cover letter explaining the contract. The client, she said, signs the letter and attests to the fact that the client has received a copy of the contract and agrees to its terms. Randy Lee suggested that if the client's consent is required to be in writing, as the previous motion determined, then all careful lawyers will ensure that something like what was described will also occur. The difference, he said, is that the "signing" will not be required by rule.
With the consent of the second, the motion was withdrawn.
With respect to paragraph (b) of Rule 1.8, Tim Priebe said the model rule replaces current references to Rules 1.6 and 3.3 with a generic reference to "these Rules". The reason for the change, he said, is that the ABA prefers that rule references be included in the Comment. Randy Lee noted that while that may be the ABA's stated preference, it is one that is not followed in other model rules. Committee members agreed no change was necessary to paragraph (b).
In light of the time, Chair Senechal said the Committee would review the remainder of Rule 1.8 at the Committee's next meeting.
Rule Review Assignments
The following rule review assignments were made: Dan Crothers - Rule 1.2 (objectives vs. scope of representation) and Rule 1.10; Sandi Tabor - Rule 1.11; Mike Williams - Rule 1.12; Randy Lee - Rule 1.13.
There being no further business, the meeting was adjourned at 2:30 p.m.