Ethics Opinions

Opinion No. 02-1

Summary: When a lawyer is representing a husband and wife as co-executors of an estate in which they are beneficiaries of a substantial minority interest in a valuable piece of real estate, the lawyer may not undertake representation of the wife in a divorce proceeding against the husband unless he can meet the consent and objective test requirements of Rule 1.7(a). Whether he may represent the wife with the husband's consent depends upon the circumstances of the particular case. The lawyer may not solve the conflict problem by withdrawing from representation of the husband as co-executor.

Facts: A lawyer represents a husband and wife as co- executors. The husband and wife are also devisees under the testator's will of a substantial minority interest in a valuable piece of real estate. The lawyer has never represented the husband or wife on any other matter. During the course the representation, the husband and wife decide to divorce and the wife asks the lawyer to represent her in that proceeding. In the course of his representation of the estate, the lawyer has obtained no confidential information from the husband individually. The lawyer asks three questions: 1) May the lawyer represent the wife if the husband does not consent? 2) May the lawyer represent the wife if the husband does consent? 3) If the lawyer ceased to represent the husband as co-executor, may he represent the wife as co-executor and also in her divorce matter?

Discussion: Rule 1.7 of the Massachusetts Rules of Professional Conduct provides:

(a) A lawyer shall not represent a client if the representation of that client will be directly adverse to another client, unless:

(1) the lawyer reasonably believes the representation will not adversely affect the relationship with the other client; and

(2) each client consents after consultation.

(b) A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person, or by the lawyer's own interests, unless:< br>
(1) the lawyer reasonably believes the representation will not be adversely affected; and

(2) the client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved.

Comment 3 to Rule 1.7 provides:
As a general proposition, loyalty to a client prohibits undertaking representation directly adverse to that client without that client's consent. Paragraph (a) expresses that general rule. Thus, a lawyer ordinarily may not act as advocate against a person the lawyer represents in some other matter, even if it is wholly unrelated. . . .

Under Rule 1.7, the issue is whether representing the wife against the husband in the divorce matter would be directly adverse to an existing client, that is, whether representation of the husband as executor is the equivalent of representation of the husband as an individual. We have addressed that question previously in our Opinion 92-2. In that Opinion we said:

The general rule is that a lawyer may not represent, and be adverse to, a client at the same time, at least not without consent of both clients after full disclosure of the possible effects of the multiple representation on the independence of the lawyer's professional advice. The McCourt Co., Inc. v. FPC Properties Inc., 386 Mass. 145 (1982). Even with consent, taking an adverse position to a current client is not permitted unless it is "obvious that the lawyer can adequately represent the interests of each." DR 5-105(C). . . . There is an issue whether representation of an individual as executor should be regarded as representation of the individual for purposes of the conflict rules. The executor exists for purposes of distributing the estate in accordance with the will and the law, and often an executor who happens to be an individual is not acting for his individual benefit. The person as executor could therefore be regarded as a different legal entity from the person as individual. On the other hand, the lawyer representing an executor, especially an executor who is an individual and not an organization, is dealing with a flesh and blood client whom he has an obligation to advise and keep out of trouble. A relationship of trust and confidence is built up with executor that is difficult to ignore when another client proposes to take action against that person as an individual. Whatever the correct outcome in the usual case, see Hazard, Triangular Lawyer Relationships, 1 Geo. J. Leg. Ethics 15 (1987), this situation is different. Y, the executor, is the principal beneficiary of the estate and, aside from his obligation to pay the debts of the estate, is acting essentially for himself. At least in these circumstances, our advice is to regard Y the individual as a client for purposes of DR 5-105.

We conclude that there is no substantial difference between the situation where the client-executor is the principal beneficiary of an estate and where the client- executor is an important beneficiary of the estate. In those circumstances, our Opinion 92-2 governs and we do not need to address the issue whether an individual-executor should be treated as an individual client even if he or she is not a beneficiary. The McCourt rule governs, and the lawyer may not represent the wife in her divorce matter over the objection of the husband. In this regard there is no relevant difference between the substantive principle expressed in former DR 5-105 and current MRPC 1.7(a).

The second question is whether the lawyer may represent the wife in her divorce matter if the husband consents. That depends on whether he is able to comply with the condition in Rule 1.7(a) that "the lawyer reasonably believes the representation will not adversely affect the relationship with the other client . . . . " The Rule states an objective
test -- that a reasonable attorney would conclude that the lawyer's representation of the wife in the divorce matter would not adversely affect his representation of the husband in the estate matter. This test is in addition to the requirement that the husband consent to the representation after disclosure of the ramifications of the new representation by the lawyer of his wife and therefore assumes that the actual consent of the husband is not sufficient in and of itself to meet the objective test.

Whether the objective test can be met depends upon the facts of the case. If the divorce proceedings are going to be "amicable" so that those proceedings will not produce any rancor that might spill over into the estate matter, then perhaps the test can be met. The possibility of contention in the divorce proceedings would, by contrast, point in the opposite direction. In addition, if the lawyer undertook representation of the wife in the belief that he met the objective test and circumstances changed, he might then have to withdraw from representation in the middle of the proceedings, to the detriment of the wife. This possibility would have to be explained to the wife at the outset if the husband consents and the lawyer believes that he can meet the objective test of Rule 1.7.

The third question is whether the lawyer may solve his problem by ceasing representation of the husband as co-executor. Opinion 92-2 addresses that question as well and answers it in the negative. In that Opinion, we advised:

In Opinion 84-4, we adopted the general rule set forth in Unified Sewerage Authority v. Jelco, Inc., 646 F.2d 1339, 1345 n.4 (9th Cir. 1981) that the policy reasons for DR 5-105 require that ability to represent multiple parties be decided as of the time when the conflict arises and that a prohibited conflict may not be cured by withdrawing from representation of a party or by finishing the work for one of the parties. Whether exceptions might be justified in some cases for reasons of insubstantiality or the like, see N. Sacca & Sons Inc. v. East Coast Excavators (Mass. Dist. Ct. App. Div. 1992), this does not seem to us to be such a case because the liquor license matter arose while the estate matter was still active.

The Jelco rule, now known as the "hot potato" rule, is widely followed, and we believe that the Supreme Judicial Court is likely to adopt it in interpreting Rule 1.7. Under the Jelco rule, the lawyer would not be able to cure the conflict problem under Rule 1.7 by withdrawing from representation of the husband as co- executor.

Permission to publish granted by the House of Delegates on January 24, 2002. As stated in the Rules of the Committee on Professional Ethics, this advice is that of a committee without official government status.

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