MRPC Rule 1.7

(a) A lawyer shall not represent a client if the representation of that client will be directly

adverse to another client, unless:

(1) the lawyer reasonably believes the representation will not adversely affect the

relationship with the other client; and

(2) each client consents after consultation.

(b) A lawyer shall not represent a client if the representation of that client may be materially

limited by the lawyer’s responsibilities to another client or to a third person, or by the

lawyer’s own interests, unless:

(1) the lawyer reasonably believes the representation will not be adversely affected; and

Michigan Rules of Professional Conduct 21 Updated with MSC order(s)

(2) the client consents after consultation. When representation of multiple clients in a

single matter is undertaken, the consultation shall include explanation of the

implications of the common representation and the advantages and risks involved.

Loyalty to a Client.

Loyalty is an essential element in the lawyer’s relationship to a client. An impermissible conflict

of interest may exist before representation is undertaken, in which event the representation

should be declined. The lawyer should adopt reasonable procedures, appropriate for the size and

type of firm and practice, to determine in both litigation and nonlitigation matters the parties and

issues involved and to determine whether there are actual or potential conflicts of interest.

If such a conflict arises after representation has been undertaken, the lawyer should withdraw

from the representation. See Rule 1.16. Where more than one client is involved and the lawyer

withdraws because a conflict arises after representation, whether the lawyer may continue to

represent any of the clients is determined by Rule 1.9. See also Rule 2.2(c). As to whether a

client-lawyer relationship exists or, having once been established, is continuing, see comment to

Rule 1.3 and Scope, ante, p M 1-18.

As a general proposition, loyalty to a client prohibits undertaking representation directly adverse

to that client without that client’s consent. Paragraph (a) expresses that general rule. Thus, a

lawyer ordinarily may not act as advocate against a person the lawyer represents in some other

matter, even if it is wholly unrelated. On the other hand, simultaneous representation in

unrelated matters of clients whose interests are only generally adverse, such as competing

economic enterprises, does not require consent of the respective clients. Paragraph (a) applies

only when the representation of one client would be directly adverse to the other.

Loyalty to a client is also impaired when a lawyer cannot consider, recommend, or carry out an

appropriate course of action for the client because of the lawyer’s other responsibilities or

interests. The conflict in effect forecloses alternatives that would otherwise be available to the

client. Paragraph (b) addresses such situations. A possible conflict does not itself preclude the

representation. The critical questions are the likelihood that a conflict will eventuate and, if it

does, whether it will materially interfere with the lawyer’ s independent professional judgment in

considering alternatives or foreclose courses of action that reasonably should be pursued on

behalf of the client. Consideration should be given to whether the client wishes to accommodate

the other interest involved.

Consultation and Consent.

A client may consent to representation notwithstanding a conflict. However, as indicated in

paragraph (a)(1) with respect to representation directly adverse to a client, and paragraph (b)(1)

with respect to material limitations on representation of a client, when a disinterested lawyer

would conclude that the client should not agree to the representation under the circumstances, the

lawyer involved cannot properly ask for such agreement or provide representation on the basis of

the client’s consent. When more than one client is involved, the question of conflict must be

resolved as to each client. Moreover, there may be circumstances where it is impossible to make

the disclosure necessary to obtain consent. For example, when the lawyer represents different

clients in related matters and one of the clients refuses to consent to the disclosure necessary to

Michigan Rules of Professional Conduct 22 Updated with MSC order(s)

permit the other client to make an informed decision, the lawyer cannot properly ask the latter to

consent.

Lawyer’s Interests.

The lawyer’s own interests should not be permitted to have adverse effect on representation of a

client. For example, a lawyer’s need for income should not lead the lawyer to undertake matters

that cannot be handled competently and at a reasonable fee. See Rules 1.1 and 1.5. If the

probity of a lawyer’s own conduct in a transaction is in serious question, it may be difficult or

impossible for the lawyer to give a client detached advice. A lawyer may not allow related

business interests to affect representation, for example, by referring clients to an enterprise in

which the lawyer has an undisclosed interest.

Conflicts in Litigation.

Paragraph (a) prohibits representation of opposing parties in litigation. Simultaneous

representation of parties whose interests in litigation may conflict, such as coplaintiffs or

codefendants, is governed by paragraph (b). An impermissible conflict may exist by reason of

substantial discrepancy in the parties’ testimony, incompatibility in positions in relation to an

opposing party, or the fact that there are substantially different possibilities of settlement of the

claims or liabilities in question. Such conflicts can arise in criminal cases as well as civil. The

potential for conflict of interest in representing multiple defendants in a criminal case is so grave

that ordinarily a lawyer should decline to represent more than one codefendant. On the other

hand, common representation of persons having similar interests is proper if the risk of adverse

effect is minimal and the requirements of paragraph (b) are met. Compare Rule 2.2 involving

intermediation between clients.

Ordinarily, a lawyer may not act as advocate against a client the lawyer represents in some other

matter, even if the other matter is wholly unrelated. However, there are circumstances in which

a lawyer may act as advocate against a client. For example, a lawyer representing an enterprise

with diverse operations may accept employment as an advocate against the enterprise in an

unrelated matter if doing so will not adversely affect the lawyer’ s relationship with the enterprise

or conduct of the suit and if both clients consent upon consultation. By the same token,

government lawyers in some circumstances may represent government employees in proceedings

in which a government agency is the opposing party. The propriety of concurrent representation

can depend on the nature of the litigation. For example, a suit charging fraud entails conflict to a

degree not involved in a suit for a declaratory judgment concerning statutory interpretation.

Interest of Person Paying for a Lawyer’s Service.

A lawyer may be paid from a source other than the client if the client is informed of that fact and

consents and the arrangement does not compromise the lawyer’s duty of loyalty to the client.

See Rule 1.8(f). For example, when an insurer and its insured have conflicting interests in a

matter arising from a liability insurance agreement, and the insurer is required to provide special

counsel for the insured, the arrangement should assure the special counsel’s professional

independence. So also, when a corporation and its directors or employees are involved in a

controversy in which they have conflicting interests, the corporation may provide funds for

separate legal representation of the directors or employees if the clients consent after

consultation and the arrangement ensures the lawyer’s professional independence.

Other Conflict Situations.

Michigan Rules of Professional Conduct 23 Updated with MSC order(s)

Conflicts of interest in contexts other than litigation sometimes may be difficult to assess.

Relevant factors in determining whether there is potential for adverse effect include the duration

and intimacy of the lawyer’s relationship with the client or clients involved, the functions being

performed by the lawyer, the likelihood that actual conflict will arise, and the likely prejudice to

the client from the conflict if it does arise. The question is often one of proximity and degree.

For example, a lawyer may not represent multiple parties in a negotiation whose interests are

fundamentally antagonistic to each other, but common representation is permissible where the

clients are generally aligned in interest even though there is some difference of interest among

them.

Conflict questions may also arise in estate planning and estate administration. A lawyer may be

called upon to prepare wills for several family members, such as husband and wife, and,

depending upon the circumstances, a conflict of interest may arise. In estate administration the

identity of the client may be a question of law. The lawyer should make clear the relationship to

the parties involved.

A lawyer for a corporation or other organization who is also a member of its board of directors

should determine whether the responsibilities of the two roles may conflict. The lawyer may be

called on to advise the corporation in matters involving actions of the directors. Consideration

should be given to the frequency with which such situations may arise, the potential intensity of

the conflict, the effect of the lawyer’s resignation from the board, and the possibility of the

corporation’s obtaining legal advice from another lawyer in such situations. If there is material

risk that the dual role will compromise the lawyer’ s independence of professional judgment, the

lawyer should not serve as a director.

Conflict Charged by an Opposing Party.

Resolving questions of conflict of interest is primarily the responsibility of the lawyer

undertaking the representation. In litigation, a court may raise the question when there is reason

to infer that the lawyer has neglected the responsibility. In a criminal case, inquiry by the court

is generally required when a lawyer represents multiple defendants. See MCR 6.101(C)(4).

Where the conflict is such as clearly to call in question the fair or efficient administration of

justice, opposing counsel may properly raise the question. Such an objection should be viewed

with caution, however, for it can be misused as a technique of harassment. See Scope, ante, p M

1-18.