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.
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Ohio Legal Ethics Narrative
[ARBITRATORS OR MEDIATORS ARE EXAMPLES OF THIRD-PARTY NEUTRALS. A MORE ACCURATE TITLE WOULD BE "LAWYER SERVING AS THIRD-PARTY NEUTRAL" (THE MODEL RULE TITLE) OR "LAWYER SERVING AS ARBITRATOR, MEDIATOR, OR OTHER THIRD-PARTY NEUTRAL." SEE THE USE OF "OTHER" IN SIMILAR CIRCUMSTANCES IN THE TITLE TO OHIO RULE 1.12.]
The text of Ohio Rule 2.4 is identical to the Model Rule.
The following section of the Ohio Code of Professional Conduct is listed in the Correlation Table (Appendix A to the Rules) as related to Ohio Rule 2.4: EC 5-21.
The text of Ohio Rule 2.4 is identical to MR 2.4, which was added to the Model Rules in 2002. In contrast to former OH EC 5-21 (as to which see below), the Ohio rule involves acting as a third-party neutral to assist two or more persons who are not clients in resolving a dispute that has arisen between them. Ohio Rule 2.4(a). If one or more of the parties to the dispute are unrepresented, Ohio Rule 2.4(b) obligates the lawyer neutral, at a minimum, to inform the unrepresented party or parties that he is not representing them. And, if the third-party neutral knows or reasonably should know that any party is confused about the third-party neutral's role, the neutral must explain to them how that role differs from that of a lawyer representing a client. Id. The extent of disclosure required will turn on the subject matter of the proceedings, the sophistication of the parties, and the type of dispute resolution device employed. Ohio Rule 2.4 cmt. .
Because the third-party neutral role does not involve representing clients, many of the Ohio Rules are inapplicable to the lawyer working in that capacity (although those rules not based on client representation continue to apply). Rather, third-party neutral practice is largely governed by other statues and rules. Ohio Rule 2.4 cmt. . See discussion below at "Additional Restrictions."
In contrast, lawyers who represent clients in an alternative dispute resolution process are subject to the full measure of the Ohio Rules. Ohio Rule 2.4 cmt. . If the third-party neutral is subsequently asked to serve as a lawyer representing a client in the same matter, the conflicts-of-interest issues that arise for the lawyer and the lawyer's firm are controlled by Ohio Rule 1.12. Ohio Rule 2.4 cmt. .
The only provision in the former OHCPR touching on the subject of third-party neutrals was OH EC 5-21, which provided:
A lawyer is often asked to serve as an impartial arbitrator or mediator in matters which involve present or former clients. He may serve in either capacity if he first discloses such present or former relationships. After a lawyer has undertaken to act as an impartial arbitrator or mediator, he should not thereafter represent in the dispute any of the parties involved.
See related discussion concerning partisan arbitrators at section 1.12:500.
Additional restrictions: In addition to Rules 1.12 and 2.4, other provisions, grounded in the substantive law governing arbitrators and mediators, bear on a lawyer's service in these capacities. With respect to arbitration, see ORC CH 2711. The Ohio statutory law governing mediation is collected in 3 Sarah R. Cole, Nancy H. Rogers & Craig A. McEwen, Mediation: Law, Policy, Practice at App. C-36 (2d ed. 2007). Subsection (H) of the testimonial-privilege statute prohibits a domestic-relations mediator from testifying in certain domestic relations proceedings concerning information discussed or presented in the mediation process. ORC 2317.02(H). (In its Ohio Code Comparison to Rule 1.12, the Task Force states that 2317.02(H) has been repealed; we find no evidence of repeal. See section 1.12:200 at "Confidentiality and service as a judge, adjudicative officer, third-party neutral or law clerk.") See also Rule 2.4 cmt. , noting that various codes of ethics may apply to lawyer/third-party neutrals, including but not limited to the Code of Ethics for Arbitration in Commercial Disputes.
Lawyer as arbitrator: In cases involving arbitration, courts have considered the impact that potential conflicts of interests of the lawyer/arbitrator may have on the validity of the arbitration process itself. Significant conflicts must be disclosed to the parties involved in the arbitration. Failure to do so constitutes "evident partiality" on the arbitrator's part, which justifies vacation of an arbitration award. ORC 2711.10(B).
Of most concern are situations in which there is a direct and substantial relationship between the arbitrator and a party. Under such circumstances, there is a duty to discover and disclose the relationship. The primary case on this point is Close v. Motorists Mut. Ins. Co., 21 Ohio App.3d 228, 486 N.E.2d 1275 (Franklin 1985). In Close, an arbitration decision was vacated under ORC 2711.10(B) where the attorney-arbitrator was a member of a law firm that did substantial work for one of the parties in the litigation. The fact that the arbitrator was not personally aware of the fact was found to be irrelevant. He had a duty to discover and to disclose the conflict so that the parties could address and resolve the conflict before arbitration.
Also troubling for the courts are cases in which the lawyer-arbitrator has a continuing relationship with an attorney representing one of the parties in the litigation. In King v. Sentry Claims Serv., 71 Ohio App.3d 701, 595 N.E.2d 380 (Cuyahoga 1991), for example, the arbitrator chosen by the plaintiffs had an ongoing legal and business relationship with the plaintiffs' attorney. The arbitrator had even signed a complaint by the plaintiffs in a previous, possibly related, proceeding as a professional courtesy to the plaintiff's lawyer. Similarly, in Furtado v. Hearthstone Condominium Ass'n, No. 86 AP-1003, 1987 Ohio App. LEXIS 7217 (Ohio App. Franklin May 19, 1987), the arbitrator chosen by defendant's counsel had received referrals from defendant's counsel, which referrals accounted for between one to five percent of the arbitrator's legal practice, and he rented office space, shared office services, and was a social friend of the defendant's lawyer. He also was godparent to one of the defendant's lawyer's children. In both King and Furtado, over strong dissents, the arbitration award was held not violative of ORC 2711.10(B), despite the failure of the arbitrator to disclose the underlying relationship.
As the relationship between the arbitrator and the party becomes more remote, failure to disclose the relationship becomes less of a concern. For example, in Beck Suppliers, Inc. v. Dean Witter Reynolds, Inc., 53 Ohio App.3d 98, 558 N.E.2d 1187 (Sandusky 1988), the fact that the arbitrator's law firm represented the parent and affiliate corporations of a party was considered to be too indirect a relationship to warrant vacation of the arbitration award because of a failure to disclose that fact. In Staff v. State Farm Mut. Ins. Co., 87 Ohio App.3d 440, 622 N.E.2d 434 (Cuyahoga 1993), the failure to disclose that the lawyer for a party in the arbitration had signed an endorsement letter for the arbitrator when the arbitrator was running for judge was held to be of no legal consequence.
Lawyer as mediator: The conflict-of-interest problems arising for a lawyer engaged in mediation are illustrated clearly in the divorce-mediation context. A lawyer who attempts to represent both spouses in a divorce faces at least a potential conflict of interest, as each is likely to have differing interests on such questions as how the marital estate should be divided and what the child custody arrangements should be. See generally section 1.7:310 at "Conflict among current clients - Divorce, dissolution, and related matters." If, however, the lawyer acts as an impartial intermediary instead of as an advocate for each client, and the right limitations are in place, the conduct can be carried out free of conflict. The real question in such circumstances is how far the lawyer can go in mediation before the lawyer's status shifts from a neutral intermediary to a party's representative.
Substantial disagreement exists nationally concerning the proper scope of activities that can be carried out by a lawyer/mediator. See 1 Sarah R. Cole, Nancy H. Rogers & Craig A. McEwen, Mediation: Law, Policy, Practice § 10.02 (2d ed. 2001 & Supp. 2007-08). Prior to the adoption of the Rules, the primary guidance in Ohio came from one Board of Commissioners' opinion and two opinions of the Ohio State Bar Association.
In Bd. of Comm'rs on Grievances & Discipline Op. 2001-5, 2001 Ohio Griev. Discip. LEXIS 6 (Oct. 5, 2001), the Board opined that a court-employed lawyer/mediator could not conduct a private-fee mediation of any case pending on the docket of the employing court. Such conduct violated the Ohio Ethics Law applicable to judicial employees (accepting outside compensation to perform his/her official duties) and former OH DR 9-101(B), which prohibited an attorney from accepting private employment in a matter in which the attorney had "substantial responsibility" as a public employee. This would not be the case if the lawyer/mediator engaged in private-fee mediation of matters not pending on the docket of the employing court or of civil cases pending in jurisdictions other than that of the employing court. The underlying (if unstated) premise of the opinion is that attorneys can properly act as court-employed mediators.
The two state bar opinions are Ohio State Bar Ass'n Informal Op. 82-2 (Aug. 3, 1982); Ohio State Bar Ass'n Informal Op. 75-16 (Oct. 29, 1975). Considered together, these opinions endorsed the role of lawyer as mediator in the divorce context, at least where the mediation was limited to economic issues. (The principal bar association opinion approving divorce mediation, Op. 75-16, involved a mediation practice in which the mediators expressly limited their mediation to the economic aspects of terminating a marriage, and specifically declined to advise on whether the termination was advisable, or how custody, visitation, and related issues should be handled. In practice, however, such noneconomic issues often are handled by lawyer-mediators in the mediation process.) Preparing a memorandum of understanding to memorialize the results of the mediation also is allowed. The bar association viewed this as merely the act of a scrivener, raising no conflict-of-interest questions not already raised by the act of mediating itself. Op. 82-2, at 3. Instructing the parties to have the document reviewed by independent counsel before signing it further assured that the lawyer/mediator's role was properly confined. Id.
The opinions also allowed, in limited circumstances, post-mediation representation of any of the parties in court proceedings to finalize the divorce or dissolution. The bar association acknowledged that to represent one of the parties in the divorce or dissolution proceeding would appear to raise a conflict, but found the conduct to be proper, provided three conditions were met. First, the lawyer must fully inform the client that, because he or she acted as a mediator, the lawyer cannot advise the client on the merits of the memorandum of understanding or the termination of the marriage. Second, both parties must consent to the representation, after each side has had the opportunity to consult independent counsel about the matter. Third, representation is permitted only in instances where the underlying agreement and desire to terminate the marriage remain unchanged. Id. at 4; Op. 75-16, at 2.