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End-of-life notice: American Legal Ethics Library

As of March 1, 2013, the Legal Information Institute is no longer maintaining the information in the American Legal Ethics Library. It is no longer possible for us to maintain it at a level of completeness and accuracy given its staffing needs. It is very possible that we will revive it at a future time. At this point, it is in need of a complete technological renovation and reworking of the "correspondent firm" model which successfully sustained it for many years.

Many people have contributed time and effort to the project over the years, and we would like to thank them. In particular, Roger Cramton and Peter Martin not only conceived ALEL but gave much of their own labor to it. We are also grateful to Brad Wendel for his editorial contributions, to Brian Toohey and all at Jones Day for their efforts, and to all of our correspondents and contributors. Thank you.

We regret any inconvenience.

Some portions of the collection may already be severely out of date, so please be cautious in your use of this material.


Connecticut Legal Ethics

1.13   Rule 1.13 Organization as Client

1.13:100   Comparative Analysis of Connecticut Rule

Primary Connecticut References: CT Rule 1.13
Background References: ABA Model Rule 1.13, Other Jurisdictions
Commentary:
Connecticut Commentary:

1.13:101      Model Rule Comparison

Conn. Rule 1.13 is identical to Model Rule 1.13.

1.13:102      Model Code Comparison

There is no counterpart to this Rule in the Disciplinary Rules of the Model Code. EC 5-18 stated that a "lawyer employed or retained by a corporation or similar entity owes his allegiance to the entity and not to a stockholder, director, officer, employee, representative, or other person connected with the entity. In advising the entity, a lawyer should keep paramount its interests and his professional judgment should not be influenced by the personal desires of any person or organization. Occasionally, a lawyer for an entity is requested by a stockholder, director, officer, employee, representative, or other person connected with the entity to represent him in an individual capacity; in such case the lawyer may serve the individual only if the lawyer is convinced that differing interests are not present." EC 5-24 stated that although a lawyer "may be employed by a business corporation with non-lawyers serving as directors or officers, and they necessarily have the right to make decisions of business policy, a lawyer must decline to accept direction of his professional judgment from any layman." DR 5-107(B) provided that a lawyer "shall not permit a person who ... employs ... him to render legal services for another to direct or regulate his professional judgment in rendering such legal services."

1.13:200   Entity as Client

Primary Connecticut References: CT Rule 1.13(a)
Background References: ABA Model Rule 1.13(a), Other Jurisdictions
Commentary:
Connecticut Commentary:

In Mayer-Wittman Joint Ventures, Inc. v. Gunther Intern., No. 93-0134790, 1994 WL 271795, *1 (Conn. Super. June 6, 1994), the issue before the court was whether an attorney-client relationship existed between Mayer-Wittman (president of plaintiff company and director of defendant company) and the law firm representing defendant company. The court cited the Comment to Conn. Rule 1.13 and the Connecticut Practice Book in reiterating that "if an organizational client requests its lawyer to investigate allegations of wrongdoing, interviews made between the lawyer and the corporate employees or constituents during the course of that investigation are covered by Rule 1.6." After considering the facts, the court held that there was no indication that the firm in question ever represented the plaintiff or its officer in a personal matter and denied the motion to disqualify.

Informal Opinion 95-14 (1995) stated that so long as a lawyer's role is precise and clear and she comports herself in accord with the Rules of Professional Conduct, she may remain an employee of a corporation and represent it in and out of court in connection with collection matters. In issuing this opinion, the Committee represented that two Connecticut Supreme Court cases that predated Conn. Rule 1.13, holding that a corporation could be represented at a hearing only by an attorney who was not a salaried employee, were no longer applicable.

1.13:210      Lawyer with Fiduciary Obligation to Third Person

There appear to be no pertinent Connecticut court decisions or ethics opinions on this subject.

1.13:220      Lawyer Serving as Officer or Director of an Organization

In DeLeon v. Fonda, No. 97-0059096, 1998 WL 165062, *1 (Conn. Super. Apr. 2, 1998), plaintiff brought a legal malpractice action against defendant. The plaintiff and a third party, with the assistance of the defendant lawyer, undertook a venture to acquire property. A year later, the plaintiff received an offer from a developer to buy the project rights to the property. The defendant and plaintiff's partner persuaded the plaintiff not to accept the offer. The property's project rights were ultimately sold for less than the first developer had offered. Then, the defendant, plaintiff's partner and the developer formed a partnership for the purpose of developing and managing the property. Neither the defendant nor the plaintiff's partner informed the plaintiff of this arrangement. In denying the motion to strike the count of legal malpractice, the court cited ABA Formal Opinion No. 91-361 (1991): "a lawyer who represents a partnership represents the entity rather than the individual partners unless the specific circumstances show otherwise. Whether a lawyer representing a partnership has an attorney-client relationship with any individual partner depends on the facts of the particular situation ..." In construing the facts in the complaint most favorably to the plaintiff, the court held that these facts would support a cause of action.

1.13:230      Divers Kinds of Entities as Organizations

Informal Opinion 97-3 (1997) discussed the situation where a director of the executive board of an incorporated residential condominium association and owner of condominium unit in that association was asked to represent the association in the collection of common charges, penalties and fines from other unit owners. The Committee stated that the lawyer/director/owner must explain to each unit owner that he represents the association when he makes a claim.

1.13:300   Preventing Injury to an Entity Client

Primary Connecticut References: CT Rule 1.13(b) & (c)
Background References: ABA Model Rule 1.13(b) & (c), Other Jurisdictions
Commentary:
Connecticut Commentary:

Formal Opinion 41 (1990) concerned a lawyer employed in the home office of a corporation. The corporation was engaged in litigation where an agreement had been made between outside counsel and an informant, where the informant was to be paid a substantial sum of money for information provided. The lawyer thought that this agreement was illegal, perhaps criminal, and sought an opinion from the Committee to outline his disclosure obligation. The Committee identified the measure taken in accordance with Rule 1.13; the lawyer referred the matter to a higher authority in the company. Further options included referring the matter to the Board of Directors or resignation, if warranted by the seriousness of the matter.

1.13:310      Resignation Versus Disclosure Outside the Organization

[The discussion of this topic has not yet been written.]

1.13:400   Fairness to Non-Client Constituents Within an Entity Client

Primary Connecticut References: CT Rule 1.13(d)
Background References: ABA Model Rule 1.13(d), Other Jurisdictions
Commentary:
Connecticut Commentary:

In In re JLM, Inc., 210 B.R. 19 (B.A.P. 2d Cir. 1997), the court distinguished this case from the non-bankruptcy context, where absent ongoing fraud or criminal activity, an attorney's obligation is to advise clients and if the client disagrees, the attorney resigns pursuant to Conn. Rule 1.13(c). In bankruptcy proceedings, the corporation's board of directors are obligated to "consider the best interests of creditors, and because counsel for the debtor in possession has fiduciary obligations not ordinarily foisted upon the attorney-client relationship, the attorney for the debtor in possession may not simply resign where the client refuses the attorney's advice."

1.13:500   Joint Representation of Entity and Individual Constituents

Primary Connecticut References: CT Rule 1.13(e)
Background References: ABA Model Rule 1.13(e), Other Jurisdictions
Commentary:
Connecticut Commentary:

Informal Opinion 99-13 (1999) stated that the Rules of Professional Conduct did not bar an attorney for a trade association from accepting additional duties as attorney for additional member institutions, subject to the provisions of Rules 1.7, 1.13 and Rule 5.5.

Informal Opinion 91-19 (1991) discussed the formation of a corporation for the purpose of purchasing a restaurant and the corporation's request for production of corporate books and records. The Committee stated that after the corporation was formed, the lawyer not only represented his individual client (who requested assistance in the formation of the corporation), but the corporation as well. The books and records of a corporation are its property. The president of the corporation may request these books and records and unless the lawyer has reason to believe that the president intends to use these books and records in a manner that would violate the law or cause injury to the corporation, he does not need to consult with the sole shareholder.

1.13:510      Corporate Counsel's Role in Shareholder Derivative Actions

There appear to be no pertinent Connecticut court decisions or ethics opinions on this subject.

1.13:520      Representing Client with Fiduciary Duties

In Tremont v. Yuditski, No. 95-321175, 1997 WL 12326, *1 (Conn. Super. Jan. 3, 1997), the defendant moved to disqualify plaintiff's law firm on the ground that the firm owed the defendant a fiduciary duty. The plaintiff brought this action to recover shares of stock that were mistakenly transferred to the defendant rather than to a successor pension plan, after the original pension plan was terminated. The plaintiff retained the firm to review the termination of an old profit sharing plan and to advise what distributions were to be made to the defendant. However, the firm managed the original plan, of which the defendant was a beneficiary. The court concluded that the firm did not have interests adverse to the interests of the new pension plan. While the firm may have had a fiduciary duty to the beneficiaries of the old plan, the existence of the duty did not make those beneficiaries clients of the firm.

1.13:530      Representing Government Client

Informal Opinion 99-34 (1999) discussed a partner in a real estate partnership who sought approval of the town of which he was town attorney to subdivide the partnership's property, without appealing the Zoning Commission's denial of approval. The Committee stated that Conn. Rule 1.13 "recognizes that a town attorney may also represent taxpayers ("constituents") of the town [and that] the organization (in this case, the Town), may be capable of consenting to questionable representation if, as a threshold matter, the provisions of Rule 1.7(b)(1) have been satisfied." The Committee concluded that if (1) the attorney (as town attorney) recused himself from representing the town with respect to the matter before the Planning and Zoning Commission; and (2) neither the attorney nor any member of his firm represented the partnership in those proceedings, and (3) the attorney explained the facts of this situation, and the steps he took to avoid any possible influence he might have on its resolution, to the Chief Executive Authority of the town and received the consent of the Chief Executive Authority of the town, to remain town attorney, he would have satisfied 1.7(b) and 1.13.

In Place v. City of Waterbury, No. 96-181435, 1996 WL 686909, *1 (Conn. Super. Nov. 19, 1996), the defendant moved to disqualify plaintiff's attorney and law firm for its representation of plaintiff in this claim against the City. Prior to this suit, the law firm negotiated and prepared a lease for "Workforce," a regional organization comprised of local municipalities including the defendant. The court held that Conn. Rule 1.13 did not apply to this case because an attorney-client relationship never existed between the firm and the defendant.

Informal Opinion 96-14 (1996) discussed the application of Rule 1.13(a)-(c) to a lawyer who believed that his employer, a government agency, was utilizing procedures that were unconstitutional or otherwise not permitted by law. The Committee stated that this "whistle-blowing rule" suggested that the lawyer may raise his objection to the procedures with agency supervisors and if the response is not satisfactory, he may ask for consideration of his objections by higher authorities in the organization. If this does not adequately resolve his objections, he may resign. The Committee cited the Comment to Rule 1.13, which states that "when the client is a governmental organization, a different balance may be appropriate between maintaining confidentiality and assuring that the wrongful official act is prevented or rectified" because public business is involved.

In Wise v. Lowery, No. 94-0533322, 1995 WL 506071, *1 (Conn. Super. Aug. 16, 1995), the court read Conn. Rule 1.13 to permit an attorney and her firm to represent a town and, simultaneously, represent an official of the town. The court recognized that town governments are "rife with disputes between agencies, between officials and agencies, between elected and appointed officials, etc. An important role of a town attorney is to give advice to the governing authority of the town regarding these disputes.... A rule saying a town attorney represented each agency or official, at all times, ... would require towns to employ different sets of lawyers in many situations."