Maryland Legal Ethics

1.13 Rule 1.13 Organization as Client

1.13:100 Comparative Analysis of Maryland Rule

¥ Primary Maryland References: MD Rule 1.13
¥ Background References: ABA Model Rule 1.13, Other Jurisdictions
¥ Commentary:

1.13:101 Model Rule Comparison

Maryland Rule 1.13 is substantially identical to MR 1.13 except in one important respect. Maryland Rule 1.13(c) substantially expands a lawyer's discretionary authority to take various actions when the organization's highest authority insists on taking an action that is likely to result in a substantial injury to the organization. MR 1.13(c) limits a lawyer's discretionary authority to resignation as counsel for the organization. Maryland, on the other hand, provides that the "lawyer may take further remedial action that the lawyer reasonably believes to be in the best interest of the organization. Such action may include revealing information otherwise protected by Maryland Rule 1.6 only if the lawyer reasonably believes that:

(1) the highest authority in the organization has acted to further the personal or financial interests of members of the authority which are in conflict with the interests of the organization; and

(2) revealing the information is necessary in the best interest of the organization.

In other words, under Maryland's formulation of Maryland Rule 1.13, a lawyer, in certain circumstances, may reveal confidential information if it is in the best interest of the organization. Maryland adds a paragraph to the comment section of Maryland Rule 1.13, concerning the lawyer's broader discretionary authority under paragraph (c).

1.13:102 Model Code Comparison

There is no counterpart to this Maryland Rule in the Disciplinary Rules of the Model Code. However,other sections of the Code are encompassed by Maryland Rule 1.13. EC 5-18 states 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 interest 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 a case, the lawyer may serve the individual only if the lawyer is convinced that differing interests are not present." EC 5- 24 states "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) provides 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 Maryland References: MD 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