Avoiding Conflict of Interest Claims When Representing Husband and Wife in Estate Planning
It is a common practice for lawyers to jointly represent a husband and wife in preparing an estate plan. Married couples often desire this arrangement, as they may save money by hiring a single lawyer to prepare documents for both parties. As with any joint representation scenario, though, there is always a potential for conflicts of interest to arise in the representation. Many lawyers may not recognize the ethical and malpractice risks posed by joint representation of married couples in estate planning. When these risks are ignored, lawyers expose themselves to heightened malpractice risk and ethics complaints.
Complying with the Ethics Rules
Rule 1.7 of the North Carolina Rules of Professional Conduct generally prohibits representation of a client where that representation will be directly adverse to another client or where the representation may be materially limited by the lawyer’s responsibilities to another client. Notwithstanding this general rule, a lawyer may proceed with such representation if the lawyer reasonably believes that she will be able to provide competent and diligent representation to each affected client and each affected client gives informed consent, confirmed in writing.
When to Get Informed Consent
In a situation where the clients are in a first marriage and want reciprocal estate plans, there is very little risk in joint representation without a waiver and informed consent. However, where the estate plans are not completely reciprocal or where this is a second or third marriage, the risks increase. In these cases, the lawyer should protect himself by obtaining a waiver and informed consent from the husband and wife or by declining representation. Failure to do so may result in a malpractice claim or grievance after the death of one of the spouses. If you are uncertain whether a waiver and informed consent would be required in a particular situation, it is recommended that you err on the side of getting consent. And remember that declining representation of one or both spouses is always an option and, in some cases, is required.
What is Required for Informed Consent
It is not enough to just say, “I may have a conflict of interest in representing both of you, and you have the right to have independent counsel.” Informed consent requires a lawyer to explain in detail the ways in which a lawyer’s representation of both parties could create a conflict. Lawyers Mutual claims attorney Mark Scruggs offers the following suggestions for a good informed consent waiver:
- Identify the conflict of interest. For example, if representation of the client might be materially limited by your personal interest in not having your client assert a malpractice claim against you, say so.
- Describe the workaround. Tell the client(s) why you believe you can provide competent and diligent representation notwithstanding the existence of a conflict of interest.
- Describe the upside of the client(s) waiving the conflict of interest. Reduced cost might be an upside. For example, not having to bring another lawyer up to speed on the case might be a reason for the client to consent.
- Describe the downside to the client(s) waiving the conflict of interest. If the conflict is a personal interest conflict, a downside may be that despite your best efforts to prevent it, your personal interest might influence your actions.
- Get it in writing. Rule 1.7(b)(4) requires only that the consent be confirmed in writing. “Confirmed in writing” is defined in Rule 1.0(c) as given by the client in writing or a writing that the lawyer promptly transmits to the client confirming an oral informed consent. It’s best to have the client sign the consent, if possible.
- Take it home! You might want to take it home with language something like this: “Having been fully informed of the conflict of interest and [Lawyer’s] reasonable belief that she will be able to provide competent and diligent representation to [Client] notwithstanding the conflict of interest; and further having been informed that [Client] has the right to seek other counsel to represent him/her in [The Matter], [Client] consents to [Lawyer’s] continued representation of him/her in [The Matter].”
