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LOCATION: 555 Capitol Mall, Suite 1230, Sacramento, CA 95814
PHONE: (916) 996-0400 | FAX: (916) 668-5760

Following is the 75th post in a series from Parker Law Group about recent changes to the California Bar Association (CBA)’s Rules of Professional Conduct (RPC). This rule is found in Chapter 1 – “Lawyer-Client Relationship,” focusing on issues involving attorneys who have been employed or retained by organizations.

This Rule of Professional Conduct, as revised, is as follows:

Rule 1.13   Organization as Client

(a)  A lawyer employed or retained by an organization shall conform his or her representation to the concept that the client is the organization itself, acting through its duly authorized directors, officers, employees, members, shareholders, or other constituents overseeing the particular engagement.

(b)  If a lawyer representing an organization knows that a constituent is acting, intends to act, or refuses to act in a matter related to the representation in a manner that the lawyer knows or reasonably should know is (i) a violation of a legal obligation to the organization or a breach of the law reasonably imputable to the organization, and (ii) likely to result in substantial injury to the organization, the lawyer shall proceed as is reasonably necessary for the best lawful interest of the organization. Unless the lawyer reasonably believes that it is not required in the best legal interest of the organization to do so, the lawyer shall refer the matter to higher authority in the organization, including, if warranted by the circumstances, to the highest authority that can act on behalf of the organization as determined by applicable law.

(c)  In taking any action under paragraph (b), the lawyer shall not reveal information protected by Business and Professions Code section 6068, subdivision (e).

(d)  If despite the lawyer’s actions per paragraph (b), the highest authority that can act on behalf of the organization insists upon motion, or fails to act, in a manner that is a violation of a legal obligation to the organization or a breach of the law reasonably imputable to the organization, and is likely to result in substantial injury to the organization, the lawyer shall continue to proceed as is reasonably necessary for the best lawful interests of the organization. The lawyer’s response may include the lawyer’s right and, where appropriate, duty to resign or withdraw in accordance with rule 1.16.

(e)  A lawyer who reasonably believes that he or she has been discharged because of the lawyer’s actions taken under paragraph (b), or who resigns or withdraws under the circumstances described in paragraph (d), shall proceed as the lawyer reasonably believes necessary to assure that the organization’s highest authority is informed of the lawyer’s discharge, resignation, or withdrawal.

(f)  In dealing with an organization’s constituents, a lawyer representing the organization shall explain the lawyer’s client’s identity whenever the lawyer knows or reasonably should know that the organization’s interests are adverse to those of the constituent(s) with whom the lawyer is dealing.

(g)  A lawyer representing an organization may also represent any of its constituents, subject to the provisions of rules 1.7, 1.8.2, 1.8.6, and 1.8.7. Suppose any requires the organization’s consent to the dual representation of these rules. In that case, the consent shall be given by an appropriate official, constituent, or body of the organization other than the individual to be represented or by the shareholders.

Most of the content found in Rule 3-600 (“Organization as Client”) of the CBA’s previous version of the RPC can still be found in the revised RPC’s Rule 1.13, although slightly rearranged.  The last sentence of subdivision (D) in the old rule – which says an attorney shall not mislead a constituent regarding confidential information sharing – is missing from the latest version of the rule. The first half of subd. (B) and the last two sentences of that same subdivision – along with sub-subdivisions (B)(1)-(2) – are now in subd. (b) of the new rule. And subd. (c) of the new rule was a phrase previously found in the middle of subd. (B).

Subds. (C), (D), and (E) of the RPC’s previous Rule 3-600 are now Rule 1.13(d), (f), and (g), as set forth above. Subd. (e) of CBA RPC Rule 1.13 is new, addressing the need for an attorney who has been discharged due to circumstances outlined in subd. (b) or (d), to inform the organization’s [client’s] highest authority of the attorney’s discharge, resignation, or withdrawal.

The American Bar Association (ABA)’s Model RPC Rule 1.13 has, for the most part, the same content as that found in the CBA’s revised rule. However, subd. (c) The CBA’s rule refers to information found in California’s Bus. & Prof. Code § 6068 subd. (e) – is not included in the ABA’s rule. Subd. (a) in the ABA rule conveys the same information as 1.13(a) of the CBA rule does … but more concisely. Subd. (b) is the same in both ABA and CBA rules, while subd. (c) of ABA’s rule is subd. (d) in CBA’s rule. Subd. (d) of ABA Rule 1.13 does not appear to match any content in CBA Rule 1.13. That portion of the ABA rule is shown below:

((d)  Paragraph (c) shall not apply concerning information relating to a lawyer’s representation of an organization to investigate an alleged violation of law or to defend the organization or an officer, employee, or other constituent associated with the organization against a claim arising out of an alleged violation of the law.

Potential Benefit:  By reorganizing the information about “organization as a client,” this rule – generally speaking – makes it easier for attorneys to spot essential parts of this regulation.

The information provided herein is informational only and should not be construed as legal advice or as an agreement for representation. This is not an advertisement. If you have an issue or dispute with your attorney, or are seeking advice with respect to your obligations, you should consult with an experienced attorney. Parker Law Group is a full-service litigation and transactional law firm. Mr. Parker has represented clients in professional malfeasance disputes for over 22 years. If you would like to schedule an initial consultation with Mr. Parker or his team, you can reach them at 916/996-0400 or at contact@parlawgroup.com. (An email to the law firm requesting a consultation does not create an attorney-client relationship or any agreement for representation by the firm.)

Rules of professional conduct, California Bar Association, American Bar Association, legal malpractice, client rights, organizations, Parker Law Group, Port Parker

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