State Bar of Texas Blog

Referendum 2011: By the Ballot - An Improvement to the Current Rules

Referendum 2011 started on Tuesday, January 18. Please take the time to understand the proposed disciplinary rules. This post explains by ballot item how the proposed rules improve the current rules. To read the proposed rules, please click here [PDF]. Again, please take the time to study the issues before you vote.

 

Ballot Question A.Terminology, Competent and Diligent Representation, Scope of Representation and Allocation of Authority, Communication, Fees, Confidentiality, Safekeeping Property, and Declining or Terminating Representation:

Do you favor the adoption of Proposed Rules 1.00–1.05 and 1.15–1.16 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Proposed Rule 1.00, which replaces the current Terminology section, adds terms that reflect the modern-day practice of law (for example, see "affiliated," "confirmed in writing," and "writing") and that should help Texas lawyers understand when they may be violating a Rule (for example, see "personally prohibited" and "represents").
  • These and other proposed Rules require a client's "informed consent" to otherwise prohibited activity.  Other proposed Rules, such as the conflicts-of-interest rules, require further that the "informed consent" be "confirmed in writing"; oral consent would no longer suffice. But a lawyer could generally comply with this new requirement by sending a written confirmation (such as an e-mail) of the client's oral informed consent.
  • Proposed Rules 1.03, 1.04, and 1.15 require lawyers to communicate more with their clients. These requirements respond to the large number of grievances that are filed based on lawyers' alleged failure to communicate sufficiently with clients.
  • Proposed Rule 1.05 simplifies the definition of "confidential information" by removing the burdensome distinction between "privileged information" and "unprivileged client information." The definition remains broad to protect clients, but the Rule would no longer subject a lawyer to discipline for using or disclosing information that is generally known or readily obtainable from sources generally available to the public. The revised Rule would also allow a lawyer to use or disclose confidential information when seeking legal advice about the lawyer's compliance with the Rules.
  • Proposed Rule 1.15 distinguishes between a lawyer's obligations to a client and to a third person when safekeeping property. The proposed Rule was revised substantially in response to concerns that were raised in the public comment period and now makes clear that the lawyer's duty to third persons generally arises only when the lawyer "knows" that property belongs to third persons. The proposed Rule also adds a defense for lawyers dealing with claims to the property that the lawyer reasonably believes are not valid, and it contains more explicit guidance about client trust accounts.
  • A list of defined terms in each proposed Rule appears before the comments to each Rule.


Ballot Question B. Conflicts of Interest: Multiple Clients in the Same Matter:

Do you favor the adoption of Proposed Rule 1.07 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Texas would follow the ABA’s lead in abolishing current Rule 1.07, which addresses a lawyer’s often misunderstood role as an “intermediary.” While proposed Rule 1.07 is unique, it gathers requirements that lawyers in Texas and elsewhere have to tease out of other rules. The proposed Rule mandates certain disclosures to clients before, or as soon as reasonably practicable after, a lawyer undertakes the representation of more than one client in the same matter. The proposed Rule lists three specific, reasonable things that lawyers must tell clients to comply with the disciplinary rules and, thus, provides far more certainty to lawyers than the current Rules governing multiple-client representations (Rules 1.06(c)(2) and 1.07) in what they must disclose to avoid discipline.


Ballot Question C. Other Conflicts of Interest:

Do you favor the adoption of Proposed Rules 1.06 and 1.08 - 1.12 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Proposed Rule 1.06 aligns Texas with every other state by defining conflicts of interest so that a conflict exists if a lawyer is adverse to a current client in any matter, not just in substantially related matters. The elimination of the substantial relationship test is not as significant as some lawyers seem to believe.  There are actually two prongs to the current Texas conflicts rule.  One is the substantial relationship test; the other prong provides that a lawyer shall not represent a person if the representation of that person “reasonably appears to be or become adversely limited by the lawyer’s or law firm’s responsibilities to another client or to a third person or by the lawyer’s or law firm’s own interests.” Additionally, because the federal courts in Texas adopt the 49-state rule, and because so many lawyers are also admitted elsewhere, many lawyers currently follow the 49-state rule, which provides that a lawyer or law firm may not be adverse to a current client on any matter without consent from their clients.
  • Proposed Rules 1.06 and 1.08–1.11 contain imputation provisions that do not subject a lawyer to discipline for engaging in a conflicted representation unless the lawyer either knew or reasonably should have known of the conflict. Proposed Rule 1.08(a) also contains new scienter standards that should protect against a lawyer being disciplined despite having acted reasonably. Finally, like other proposed Rules, proposed Rule 1.08 contains more specific guidance for lawyer-client communications.
  • Proposed Rules 1.09 and 1.12 have been reorganized and clarified. Proposed Rule 1.12 also provides enhanced guidance for lawyers facing reporting requirements imposed by Federal law.


Ballot Question D. Prohibited Sexual Relations, Diminished Capacity, and Prospective Clients:

Do you favor the adoption of new Proposed Rules 1.13, 1.14, and 1.17 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Proposed Rule 1.13 generally prohibits a lawyer from representing a client with whom the lawyer has sexual relations. But there are exceptions for a lawyer and client who are married to one another or were engaged in an ongoing, consensual sexual relationship that predates the lawyer-client relationship. The proposed Rule is a workable articulation of a requirement that has been discussed for over a quarter of a century by the Texas Bar.
  • Proposed Rule 1.14 addresses a lawyer's options and obligations when the lawyer is dealing with clients who have diminished capacity. It replaces current Rule 1.02(g), which lawyers have said exposes them to fiduciary duty claims for their roles in initiating allegedly unnecessary guardianships. The proposed Rule provides several options aside from guardianships and permits a lawyer to disclose a client's confidences when the lawyer is seeking to protect the client's interests.
  • Proposed Rule 1.17 concerns conflicts created by prospective clients. The proposed Rule defines a "prospective client" in a manner that excludes individuals who seek solely to conflict out lawyers who might otherwise represent the individuals' adversaries. The proposed Rule also contains a waiver provision that permits the lawyer to condition a conversation with a prospective client so that the conversation will not prohibit any future representations.


Ballot Question E. Advocate, Law Firms and Associations, Public Service, and Maintaining the Integrity of the Profession:

Do you favor the adoption of Proposed Rules 3.01-3.10, 5.01-5.07, 6.01-6.03, and 8.01-8.05 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Several changes to these proposed Rules are not substantive. But proposed Rule 3.03 has been revised substantively to clarify a lawyer's obligation of candor toward a tribunal. For example, with an exception for criminal matters, the Rule now permits a lawyer to refuse to offer or use evidence that the lawyer reasonably believes, but does not know, is false. Proposed Rule 3.07, which relates to trial publicity, has also been revised substantively. As revised, it gives a lawyer more leeway in responding to allegations of misconduct against the lawyer and in making statements to protect a client from the prejudice of publicity that neither the lawyer nor client initiated.
  • The substantive changes to the Section 5 Rules, which address supervised lawyers and nonlawyer assistants, reflect the changes in partnership designations and responsibilities since the current Rules were drafted. The changes place responsibility where it belongs (i.e., on lawyers with managerial or supervisory authority), not on lawyers based purely on their titles. The proposed Rules also make clear, however, that lawyers are not expected to take remedial action beyond the scope of their authority.
  • Proposed Rule 6.03 is new and addresses a lawyer's obligations when the lawyer participates in law-reform activities that may affect the interests of the lawyer's client. In light of this new Rule, references to law-reform activities in current Rule 6.02 have been deleted.


Ballot Question F. Counselor, Non-Client Relationship, Information About Legal Services, and Severability of Rules:

Do you favor the adoption of Proposed Rules 2.01–2.02, 4.01–4.04, 7.01–7.07, and 9.01 of the Texas Disciplinary Rules of Professional Conduct, as published in the December 2010 issue of the Texas Bar Journal?

  • Proposed Rule 2.01 is substantively the same as current Rule 2.01. Consistent with other proposed Rules, proposed Rule 2.02 now requires a client's "informed consent" rather than "consent[] after consultation." The changes to proposed Rules 4.01–4.04 are generally stylistic; however, the current Rule 4.04 requirement for a lawyer not to use means that have no substantial purpose other than to "embarrass" a third person has been modified for constitutional reasons. No substantive changes were made to Rules 7.01–7.07, which were modified in 2005 after going through a referendum in 2004. Proposed Rule 9.01 also contains no substantive changes.
     

This email was prepared with assistance from members of the Texas Disciplinary Rules of Professional Conduct Committee. For more information about Referendum 2011 and to vote, visit www.texasbar.com/rulesupdate.

 

Referendum 2011 started on Tuesday, January 18. Please take the time to understand the proposed disciplinary rules. This post explains by ballot item how the proposed rules improve the current rules.

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