MARYLAND STATE BAR ASSOCIATION, INC.
COMMITTEE ON ETHICS
ETHICS DOCKET NO. 2015-02
May an attorney represent a client who proposes to make testamentary gifts to charitable organizations that the attorney supports or volunteers for?
A member of the Maryland Bar has requested that the Ethics Committee of the Maryland State Bar Association issue a written opinion addressing whether a potential conflict can be waived under the following scenario: Attorney A serves as a Trustee of and pro bono counsel to the endowment fund of a local charitable organization (“Agency”). The Agency serves as the central fundraising entity for a number of local, national and international charitable organizations, including schools and social service organizations. A potential client has approached Attorney A and requested his representation in preparing various estate planning documents. The potential client has indicated that he wishes to make substantial charitable bequests in his estate plan. More particularly, those bequests are to (a) the private school where Attorney’s children have attended or currently attend, to which Attorney A contributes and which school is a major beneficiary of the Agency; (b) a religious organization which has a close relationship with the Agency; and (c) a national organization to which the Attorney and other firm attorneys may donate from time to time. The potential client wishes to make a contingent bequest to any organization that the potential client contributed to during the last three years of his life, which, if current patterns of giving continue, would include the Agency.
Attorney A asks the Committee whether this situation presents a conflict that is waivable upon informed consent by the potential client. Attorney A’s concern centers on Rule 1.7(a)(2), which states, “A conflict of interest exists if there is a significant risk that the representation of one or more clients will be materially limited by the lawyer’s responsibility to another client, a former client or a third party or by a personal interest of the lawyer.” More specifically, Attorney A is concerned that the representation of the potential client may run afoul of this committee’s opinion in Ethics Docket No. 2003-08, which applied Rule 1.7.
In Ethics Docket No. 2003-08, this Committee addressed a scenario that, although similar in broad contours was different in key respects. There, an attorney was on his church’s Legacy Committee, whose function was to promote legacy giving from its parishioners (i.e., bequests in wills, charitable trusts, charitable annuities, etc.) As Chair of the Legacy Committee, the attorney’s role was to explain and seek legacy giving from the church parishioners. The attorney there sought to volunteer his legal services to draft the estate planning documents (wills, codicils, and powers of attorneys) for unrepresented parishioners. The Committee concluded that the attorney could not draft these documents as parishioner’s counsel because the attorney’s “independent judgment in advising parishioners regarding whether their own interests will be served by such giving in general or by bequests to your church in particular, as issues regarding the nature, magnitude and timing of parishioners’ giving might be affected by considerations relating to your church’s financial needs.” The Committee also expressed “reservations regarding whether parishioners would be sophisticated enough to weigh the risks involved in order to knowingly consent to your representation.”
In the instant inquiry, Attorney A recognizes that his role as pro bono counsel and Trustee for the Agency’s endowment committee, and, to a lesser degree, his indirect interests in some of the other beneficiaries, present a conflict between the potential client’s interest and the Agency’s interest and/or Attorney’s interest. A significant distinction between the instant matter and Ethics Docket No. 2003-08 rests in the fact that here Attorney A did not actively seek or encourage the potential client to contribute to the Agency or any other beneficiary. Rather, the potential client came to Attorney A already having decided that he wanted to make certain bequests. Accordingly, a major concern expressed in Ethics No. 2003-08 about the attorney’s ability to exercise independent professional judgment in advising the parishioner client whether to make such bequests does not appear to be present in the instant scenario. Though not expressly stated, it is suggested by the facts that the potential client here has also previously determined the amounts that he wishes to give to his intended beneficiaries. If that is not the case, the potential client would need to be advised that Attorney A’s professional judgment may be impacted with regard to the nature, magnitude, or timing of any bequest to the school, religious organization, or the Agency. Any possible bequest to the Agency poses a potential conflict, as may any bequest to a beneficiary of the Agency. Given the known connection between the Agency and its major benefactors (school and religious organization), Attorney A’s role and involvement in the Agency endowment committee may influence his professional judgment. The Committee believes that, absent more, an attorney’s support of a national organization generally would not impact the attorney’s professional judgment. Any waiver sought for a conflict of interest must detail the limitations on the scope of Attorney A’s representation. However, if Attorney “A” concludes that the Agency’s goals conflict with the potential client’s goals a different conflict analysis may exist.
As Attorney A recognizes in his inquiry, the central question is whether the conflict can be waived. Given that Attorney A did not solicit the bequest in the current scenario, the conflict is diminished. With regard to whether the conflict can be waived, a second distinction between the two scenarios is significant. In Ethics Docket 2003-08 the Committee expressed concern about the parishioners’ sophistication in weighing the risks and waiving the conflict. Here, the potential client is “an attorney of great sophistication”. Plainly, the potential client here has the sophistication to understand any expressed limitations on the Attorney’s representation and can
give informed consent.
Consequently, it is the Committee’s opinion that any conflict of interest can be waived upon the potential client’s informed consent.