ER 2.4 Lawyer Serving as Third-Party Neutral
The Standard
A lawyer serves as third-party neutral when assisting two or more parties, who are not clients of the lawyer, to reach a resolution of a matter. A third-party neutral can act as a mediator, an arbitrator, or in another capacity. The Rules of Professional Conduct apply to lawyers serving as third-party neutrals, but their conduct also can be governed by court rules, statutes, and other professional codes and guidelines. ER 1.12 addresses conflicts of interest relating to third-party neutrals.
The Limitation
When acting as a third-party neutral, a lawyer must explain to unrepresented parties that the lawyer does not represent any party. The lawyer should also explain the difference between third-party neutrals and legal representatives, including that the attorney-client privilege does not attach to any communication a party has with the third-party neutral.
FAQs
No. Because the lawyer’s service is not provided in connection with a representation, lawyers who only operate as third-party neutrals in alternative dispute resolution are not required to hold funds for services in a trust account or even establish a trust account. Acting as a mediator or arbitrator does not create an attorney-client relationship. Ariz. Ethics Op. 03-07.
The sophistication of the client, as well as the nature of the proceedings, dictates the extent of the disclosure. Topics to address include the differences in the roles of advocate versus a neutral, and the inapplicability of the attorney-client privilege. ER 2.4, Cmt 3. You may want to have all parties execute acknowledgements of a written disclosure, especially if the unrepresented parties are unsophisticated.
If a dispute resolution process takes place before a tribunal, such as court-ordered binding arbitration, then the lawyer’s duty of candor is governed by ER 3.3. See ER 1.0(l) for the definition of “tribunal.” Otherwise, the lawyer’s duty of candor toward both the neutral and other parties is governed by ER 4.1.
Best Practices
- ER 1.1 Competence
- ER 1.2 Scope of Representation
- ER 1.3 Diligence
- ER 1.4 Communication
- ER 1.5 Fees
- ER 1.6 Confidentiality of Information
- ERs 1.7 & 1.10 Conflicts of Interest and Screening Tips
- ER 1.8 Conflict of Interest: Current Clients: Specific Rules
- ER 1.9 Duties to Former Clients
- ER 1.11 Special Conflicts of Interest for Former and Current Government Officers and Employees
- ER 1.13 Organization as Client
- ER 1.14 Client with Diminished Capacity
- ER 1.15 Safekeeping Property
- ER 1.16 Declining or Terminating Representation
- ER 2.4 Lawyer Serving as Third-Party Neutral
- ER 8.3 Reporting Professional Misconduct