In the News

ABA examines lawyer-client controversy

Monday, November 18, 2002

Crain's Chicago Business

Letters to the Editor

As notes in his guest column, the American Bar Assn. is looking again at ethics rules covering when lawyers can and whether they should be required to report clients who commit financial crimes to regulatory authorities ("Attorneys must be willing to expose complicit clients," Oct. 7).

The ABA agrees lawyers have a responsibility to help fight corporate crime – and many of our members agree that having lawyers expose their clients is the most effective way to accomplish that. But the other view, and the one that prevailed the last time we looked at this question, is that lawyers can be much more effective heading off client crimes when clients trust them to protect secrets except in very limited circumstances. Lawyers must counsel their clients to adhere to the law and point out to their clients when proposed conduct violates the law. But they can only do that if clients are forthright about sharing their plans. Honoring the lawyer-client privilege preserves the trust clients need to be open in consulting their lawyers.

In the corporate setting, the client is the organization, not any single individual. But individuals, acting as corporate agents, hire lawyers. When those agents or other corporate officers share illegal schemes, lawyers have another option besides urging a different course. They can and do report up the corporate chain of command, urging a law-abiding policy. But sometimes when lawyers and corporate agents differ over proposed conduct, it is a close call as to whether the decision is a legal one or one of corporate strategy. Unless the law is clear, and the conduct clearly would violate the law, the lawyer can only advise.

As I said at the outset, we are reconsidering these issues. In fact, our Task Force on Corporate Responsibility has been hard at work on issues regarding the lawyer's role and responsibility in corporate actions since long before Sarbanes-Oxley Act assumed center stage.

- Alfred P. Carlton Jr.PresidentAmerican Bar Assn.Chicago

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