It is quite common for corporate clients to ask their attorneys to prepare written legal opinions for use in helping them to make key decisions. These opinions are typically cloaked in privilege, for the purpose of allowing clients to know the lawyer’s legal advice and recommendations.

It is also common for corporate clients to ask their attorneys for written legal opinions that they intend to share with others. A client may want, for example, to share the results of the lawyer’s independent investigation into allegations of board misconduct. Or in another instance, the client may want to have a legal opinion ready to disclose to government regulators if there is ever an inquiry about whether the client complied with the law.

Although these are relatively routine situations, there are ethical considerations that can arise when a lawyer prepares a legal opinion for clients with the intent that it will be shared with third parties (strangers to the attorney-client relationship). These ethical duties can include the duty to maintain confidentiality and to avoid disclosing attorney-client privileged information.

Here are some tips for complying with the ethical obligations inherent in preparing a legal opinion for consumption by third parties.

Are There Competing Interests?

Rule 2.3 of the ABA Model Rules of Professional Conduct governs the preparation of legal reports for use by persons outside the attorney-client relationship. The Rule provides that “[a] lawyer may provide an evaluation of a matter affecting a client for the use of someone other than the client if the lawyer reasonably believes that making the evaluation is compatible with other aspects of the lawyer’s relationship with the client.”  Part (b) of the Rule confirms that “[w]hen the lawyer knows or reasonably should know that the evaluation is likely to affect the client’s interests materially and adversely, the lawyer shall not provide the evaluation unless the client gives informed consent.” The Rule also confirms that separate from the disclosure of a report or evaluation, “information relating to the evaluation is otherwise protected by Rule 1.6,” the rule governing confidential information.

Typically, the attorney-client relationship is one where the attorney acts as both advisor and advocate. When an attorney is retained to provide an evaluation of a matter that will be shared with third parties, there may be different goals than in the typical attorney-client relationship. It may be that the attorney is caught between two potentially competing interests in the evaluation: to render an impartial opinion so that the client can benefit from candid advice but to also ensure that the evaluation does not contain any information that will harm the client if it is being shared with third parties.

Because of the tensions between the duties owed to the client and the purpose of the evaluation, the Comments to Rule 2.3 caution that “careful analysis of the situation is required.” For example, the requirement for the client’s “informed consent” under Rule 2.3 for a legal opinion to be shared may require that the attorney advise the client regarding the potential adverse effects of sharing an evaluation with a third party.

Comment [3] to Rule 2.3 also advises that the lawyer should “be satisfied as a matter of professional judgment that making the evaluation is compatible with other functions undertaken in behalf of the client.” The comment notes that if a lawyer is defending the client from charges of fraud, it may be “incompatible” with that role to then perform an evaluation of that transaction for the benefit of others. Thus, lawyers should review whether the opinion they are asked to prepare for disclosure to third parties creates a risk with regard to any other separate or related representation of the client.

Having this discussion before commencing the representation can help ensure that both the attorney and client understand the purpose of the representation (i.e., whether the attorney is to act an advocate or as an impartial evaluator) and avoid client relations problems later.

The Duty of Candor

One of the cornerstones of the attorney-client relationship is the attorney’s ability to tell the client hard truths, protected by privilege. An attorney should be able to tell the client, frankly, their opinion of the issues being evaluated, including weaknesses in the client’s position or if the client faces significant exposure. In those instances, clients typically rely on their attorneys to provide an objective assessment of risks and liabilities for the clients’ eyes only.

On the other hand, when the lawyer’s evaluation or legal opinion is intended to be provided to others, it may not be the client’s intent for that report to contain a candid analysis. Thus, at the beginning of the representation, attorneys ask whether the client intends for the attorney to share the opinion with others to determine whether the provisions of Rule 2.3 may be implicated.

The Comments to Rule 2.3 provide a list of situations where this may become an issue, including an “opinion concerning the title of property rendered at the behest of a vendor for the information of a prospective purchaser, or at the behest of a borrower for the information of a prospective lender,” an opinion regarding the legality of securities, or an opinion provided for a third person, such as the purchaser of a business.

Protect Confidentiality

As noted above, lawyers who are preparing written opinions for consumption by others still have obligations of confidentiality. Lawyers can still ensure, when preparing materials for public disclosure, that they do not contain information that the client intends to remain confidential or privileged.

In other words, although the attorney may be called upon to evaluate an issue in an objective way (and not as an advocate) for inclusion in a report to be disclosed to others, the attorney still owes the client a duty to protect confidential information. Attorneys can take care not to disclose any confidential information unless it is necessary for the evaluation (or the client consents).

By considering the guidance in the Rules of Professional Conduct, lawyers can take steps to help fulfill their legal and ethical obligations to clients when asked to provide a legal opinion for sharing with third parties.