Arkansas Legal Ethics
1.13 Rule 1.13 Organization as Client
1.13:100 Comparative Analysis of Arkansas Rule
- Primary Arkansas References: AR Rule 1.13
- Background References: ABA Model Rule 1.13, Other Jurisdictions
- Commentary:
1.13:101 Model Rule Comparison
The Arkansas Rule is the same as the Model Rule.
1.13:102 Model Code Comparison
The comparison accepted by the Arkansas Supreme Court is identical to the comparison in the Model Rules.
1.13:200 Entity as Client
- Primary Arkansas References: AR Rule 1.13(a)
- Background References: ABA Model Rule 1.13(a), Other Jurisdictions
- Commentary: ABA/BNA — 91:2001, ALI-LGL —— 155, 156, Wolfram — 8.3
1.13:210 Lawyer with Fiduciary Obligation to Third Person
An attorney who is retained to provide legal services for a corporate entity has an attorney-client relationship with the corporation, but that relationship does not automatically extend to individual corporate directors or officers. Accordingly, the Rules do not prohibit an attorney from opposing a corporation, even though one of the corporate directors is also a director of a client corporation. Ark. Bar. Assn. Op. 97-02.
1.13:220 Lawyer Serving as Officer or Director of an Organization
Arkansas has no case law or authority on this topic.
1.13:230 Divers Kinds of Entities as Organizations
Arkansas has no case law or authority on this topic.
1.13:300 Preventing Injury to an Entity Client
- Primary Arkansas References: AR Rule 1.13(b) & (c)
- Background References: ABA Model Rule 1.13(b) & (c), Other Jurisdictions
- Commentary: ABA/BNA — 91:2001, ALI-LGL — 155, Wolfram — 13.7
1.13:310 Resignation Versus Disclosure Outside the Organization
An earlier draft of Model Rule 1.13 would have permitted the corporate attorney to take further remedial action that the lawyer believed to be in the best interest of the corporation, including revealing information otherwise protected by Rule 1.6. That language was withdrawn and replaced with the language of (c), permitting the attorney to withdraw or resign while still preserving confidentiality. See Comment [16] to Rule 1.6. But AR Rule 1.6(c) permits the attorney to announce his withdrawal and to withdraw any opinion or document.
1.13:400 Fairness to Non-Client Constituents Within an Entity Client
- Primary Arkansas References: AR Rule 1.13(d)
- Background References: ABA Model Rule 1.13(d), Other Jurisdictions
- Commentary: ABA/BNA — 91:2001, ALI-LGL — 163, Wolfram — 13.7.5
Arkansas has no case law or authority on this topic.
1.13:500 Joint Representation of Entity and Individual Constituents
- Primary Arkansas References: AR Rule 1.13(e)
- Background References: ABA Model Rule 1.13(e), Other Jurisdictions
- Commentary: ABA/BNA — 91:2601, ALI-LGL —— 156, 212, Wolfram — 13.7
A cautious attorney will avoid problems by clarifying who the client is. For example, Hughes v. Gibbs, 282 Ark. 488, 669 S.W.2d 451 (1984) (attorney represented corporation, but not the primary stock-holder). For allegations of malpractice arising from the dual representation of a corporate entity and a corporate officer, see Robertson v. White, 633 F.Supp. 954, 971 (W.D. Ark. 1986). Compare Hughes v. Gibbs, 282 Ark. 488, 669 S.W.2d 451 (1984) (attorney represented corporation, but not corporate officer).
1.13:510 Corporate Counsel's Role in Shareholder Derivative Actions
See Comments [11, 12] to Rule 1.13.
1.13:520 Representing Client with Fiduciary Duties
Closely held corporations present particular potential for conflicts among the investors and thus risk to the attorney attempting to represent all the investors. See Francis Fendler Rosenzweig, Protecting the Rights of Minority Shareholders in Close Corporations Under the New Arkansas Business Corporation Act, 44 ARK. L. REV. 1, 2-3 (1991).
1.13:530 Representing Government Client
Arkansas has no case law or authority on this topic.