Ind. Prof. Cond. Rule 2.3

Effective January 1, 2005

(a) 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.

(b) When 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.

(c) Except as disclosure is authorized in connection with a report of an evaluation, information relating to the evaluation is otherwise protected by Rule 1.6.

Comment

Definition

[1] An evaluation may be performed at the client's direction or when impliedly authorized

in order to carry out the representation. See Rule 1.2. Such an evaluation may be for the

primary purpose of establishing information for the benefit of third parties; for example, 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. In some situations, the evaluation may be required by a government

agency; for example, an opinion concerning the legality of the securities registered for

sale under the securities laws. In other instances, the evaluation may be required by a

third person, such as a purchaser of a business.

[2] A legal evaluation should be distinguished from an investigation of a person with

whom the lawyer does not have a client-lawyer relationship. For example, a lawyer

retained by a purchaser to analyze a vendor's title to property does not have a client-lawyer relationship with the vendor. So also, an investigation into a person's affairs by a government lawyer, or by special counsel by a government lawyer, or by special counsel

employed by the government, is not an evaluation as that term is used in this Rule. The

question is whether the lawyer is retained by the person whose affairs are being

examined. When the lawyer is retained by that person, the general rules concerning loy-

alty to client and preservation of confidences apply, which is not the case if the lawyer is

retained by someone else. For this reason, it is essential to identify the person by whom

the lawyer is retained. This should be made clear not only to the person under examination, but also to others to whom the results are to be made available.

Duties Owed to Third Person and Client

[3] When the evaluation is intended for the information or use of a third person, a legal

duty to that person may or may not arise. That legal question is beyond the scope of this

Rule. However, since such an evaluation involves a departure from the normal client-lawyer relationship, careful analysis of the situation is required. The lawyer must be satisfied

as a matter of professional judgment that making the evaluation is compatible with other

functions undertaken in behalf of the client. For example, if the lawyer is acting as advoc-

ate in defending the client against charges of fraud, it would normally be incompatible with

that responsibility for the lawyer to perform an evaluation for others concerning the same

or a related transaction. Assuming no such impediment is apparent, however, the lawyer

should advise the client of the implications of the evaluation, particularly the lawyer's

responsibilities to third persons and the duty to disseminate the findings.

Access to and Disclosure of Information

[4] The quality of an evaluation depends on the freedom and extent of the investigation

upon which it is based. Ordinarily a lawyer should have whatever latitude of investigation

seems necessary as a matter of professional judgment. Under some circumstances, however, the terms of the evaluation may be limited. For example, certain issues or sources

may be categorically excluded, or the scope of search may be limited by time constraints

or the noncooperation of persons having relevant information. Any such limitations that

are material to the evaluation should be described in the report. If after a lawyer has commenced an evaluation, the client refuses to comply with the terms upon which it was

understood the evaluation was to have been made, the lawyer's obligations are determ-

ined by law, having reference to the terms of the client's agreement and the surrounding

circumstances. In no circumstances is the lawyer permitted to knowingly make a false

statement of material fact or law in providing an evaluation under this Rule. See Rule 4.1.

Obtaining Client's Informed Consent

[5] Information relating to an evaluation is protected by Rule 1.6. In many situations,

providing an evaluation to a third party poses no significant risk to the client; thus, the lawyer may be impliedly authorized to disclose information to carry out the representation.

See Rule 1.6(a). Where, however, it is reasonably likely that providing the evaluation will

affect the client's interests materially and adversely, the lawyer must first obtain the client's consent after the client has been adequately informed concerning the important possible effects on the client's interests. See Rules 1.6(a) and 1.0(e).

Financial Auditors' Requests for Information

[6] When a question concerning the legal situation of a client arises at the instance of the

client's financial auditor and the question is referred to the lawyer, the lawyer's response

may be made in accordance with procedures recognized in the legal profession. Such a

procedure is set forth in the American Bar Association Statement of Policy Regarding

Lawyers' Responses to Auditors' Requests for Information, adopted in 1975.