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Illinois Bar Journal

The Magazine of Illinois Lawyers

November 2011Volume 99Number 11Page 572

November 2011 Illinois Bar Journal Cover Image

Estate Planning / Elder Law

Ethical Issues in Representing Elderly Clients with Diminished Capacity

By
Kerry R. Peck

You fear your elderly client suffers from diminished capacity. Can you allow her to make a decision you advise against? Must you? This article explores this and other issues, like conflict of interest and confidentiality, that arise in serving elderly and other estate-planning clients.

The graying of America means that lawyers more often find themselves representing clients who have cognitive impairment - often hidden - associated with advanced age. Rule 1.14 of the new Illinois Rules of Professional Conduct governs Illinois attorneys' professional obligations when dealing with a client with diminished mental capacity. Any lawyer interacting with a client or would-be client who is or might be impaired should consult this rule as a starting point.

This article applies this rule, along with Rules 1.6 (confidentiality) and 1.7 (conflict of interest), to true-to-life hypotheticals. It focuses on three broad ethical concerns: the need to 1) follow a diminished-capacity client's wishes insofar as possible, 2) determine who the client is when family members initiate the representation, and 3) protect the client's information as required by the rules.

Maintaining a "normal" relationship with a diminished-capacity client

Hypothetical A. Lauren Lawyer represents Carla Client, who is of limited means and a defendant in a contract dispute. Client has a complete defense to the action based on the creditor's fraudulent conduct. However, Client instructs Lawyer to pay the disputed bill, despite Lawyers' advice to the contrary and the disastrous impact on Client's financial well being, because Client has "always paid" her bills in the past.

Hypothetical B. Lawyer has also represented Sam Senior for many years, and has been engaged to represent him in the sale of a residence to obtain the funds necessary to move into an assisted living facility - a move that Lawyer and Senior agree is in his best interest in light of his failing health and increasing memory problems. Shortly before the scheduled closing, Senior suffered a stroke and is unable to communicate with Lawyer or attend the closing.

Rule 1.14: what is "normal"? Rule 1.14 of the Illinois Rules of Professional Conduct addresses a lawyer's professional obligations when dealing with a client with diminished capacity, providing as follows: "When a client's capacity to make adequately considered decisions in connection with a representation is diminished, whether because of minority, mental impairment or for some other reason, the lawyer shall, as far as reasonably possible, maintain a normal client-lawyer relationship with the client."

In short, a lawyer should, to the extent possible, allow the client with diminished capacity to make decisions and manage his or her affairs as any other client would. Here is Comment [1] to Rule 1.14:

The normal client-lawyer relationship is based on the assumption that the client, when properly advised and assisted, is capable of making decisions about important matters. When the client is a minor or suffers from a diminished mental capacity, however, maintaining the ordinary client-lawyer relationship may not be possible in all respects. In particular, a severely incapacitated person may have no power to make legally binding decisions. Nevertheless, a client with diminished capacity often has the ability to understand, deliberate upon, and reach conclusions about matters affecting the client's own well-being. For example….it is recognized that some persons of advanced age can be quite capable of handling routine financial matters while needing special legal protection concerning major transactions.

Comment [2] similarly notes:

The fact that a client suffers a disability does not diminish the lawyer's obligation to treat the client with attention and respect. Even if the person has a legal representative, the lawyer should as far as possible accord the represented person the status of client, particularly in maintaining communication.

However, as observed in ABA Formal Ethics Opinion 96-404, the ideal of normalcy sometimes comes up against the unfortunate reality of disability: "When the client's ability to communicate, to comprehend and assess information, and to make reasoned decisions is partially or completely diminished, maintaining the ordinary relationship in all respects may be difficult or impossible."

In that case, the lawyer owes it to his or her client to alter the relationship accordingly. Here are some techniques lawyers can use to effectively represent disabled clients.

Seeking help from family members. If necessary to assist in the representation of a client with diminished capacity, you can seek the help of family members. Doing so "generally does not affect the applicability of the attorney-client evidentiary privilege," according to Comment [3] to Rule 1.14. But the comment goes on to warn of the dangers of forgetting whom you represent: "Nevertheless, the lawyer must keep the client's interests foremost" and, to the extent possible, "look to the client, and not family members, to make decisions on the client's behalf."

Also, in determining whether the client possesses sufficient capacity to make informed decisions, the lawyer may consult with a diagnostician. See Comment [6] to Rule 1.14 ("In appropriate circumstances, the lawyer may seek guidance from an appropriate diagnostician.").

Substituted judgment. Rule 1.14(b) provides that a lawyer can take reasonably necessary protective action when a client with diminished capacity "is at risk of substantial physical, financial or other harm unless action is taken and [the client] cannot adequately act in the client's own interest."

As observed in ABA Opinion 96-404, Rule 1.14(b) does not authorize the lawyer to take protective action because the client is not acting in what the lawyer believes to be the client's best interest, but only when the client "cannot adequately act in the client's own interest." (Emphasis added.)

A client who is making decisions the lawyer considers to be ill-considered is not necessarily unable to act in his own interest, and the lawyer should not seek protective action merely to protect the client from what the lawyer believes are errors in judgment. Rule 2.1 permits the lawyer to offer his candid assessment of the client's conduct and its possible consequences and to suggest alternative courses, but he must always defer to the client's decisions. Substituting the lawyer's own judgment for what is in the client's best interest robs the client of autonomy and is inconsistent with the principles of the "normal" relationship.

Appointing a GAL. As provided in Rule 1.14(b), appropriate protective action taken by the lawyer may include "consulting with individuals or entities that have the ability to take action to protect the client and, in appropriate cases, seeking the appointment of a guardian ad litem, conservator or guardian."

Comment [7] to Rule 1.14(b) adds a caveat, however: "In many circumstances...appointment of a legal representative may be more expensive or traumatic for the client than the circumstances in fact require. Evaluation of such circumstances is a matter entrusted to the professional judgment of the lawyer." Comment [7] further notes that, in considering alternatives, the lawyer "should be aware of any law that requires the lawyer to advocate the least restrictive action on behalf of the client."

Avoiding inappropriate disclosure. As set forth in Rule 1.14(c):

Information relating to the representation of a client with diminished capacity is protected by Rule 1.6. When taking protective action pursuant to paragraph (b), the lawyer is impliedly authorized under Rule 1.6(a) to reveal information about the client, but only to the extent reasonably necessary to protect the client's interests.

Comment [8] to Rule 1.14 notes that "[d]isclosure of the client's diminished capacity could adversely affect the client's interests" and that such information is protected by Rule 1.6. Unless a lawyer is authorized to do so, he or she may not disclose such information.

However, Comment [8] further notes as follows:

When taking protective action pursuant to paragraph (b), the lawyer is impliedly authorized to make the necessary disclosures, even when the client directs the lawyer to the contrary. Nevertheless, given the risks of disclosure, paragraph (c) limits what the lawyer may disclose in consulting with other individuals or entities or seeking the appointment of a legal representative. At the very least, the lawyer should determine whether it is likely that the person or entity consulted with will act adversely to the client's interests before discussing matters related to the client. The lawyer's position in such cases is an unavoidably difficult one.

In Hypothetical A, if Lawyer believes Client has sufficient mental capacity to make an informed decision about the resolution of the contract dispute, she should respect Client's decision even if she thinks it is contrary to her interest, according to the provisions of Rule 1.14(a) and Comment 1 to Rule 1.14. Under ABA Opinion 96-404, the fact a client may make decisions which a lawyer considers to be "ill-considered" does not inevitably result in the conclusion that protective action is required; it is not the lawyer's role to substitute his or her judgment for the client's.

If, however, Lawyer believes that Client's mental capacity is so diminished that it limits her ability to make an informed decision, Lawyer may have Client's family members participate in discussions to assist Client in his decision-making, per Comment 2 to Rule 1.14. If Client is substantially impaired, Lawyer may decide per Rule 1.14(d) to take action to protect the client, including seeking the appointment of a guardian or GAL.

In Hypothetical B, given the substantial impact of Senior's stroke on his ability to adequately act in his own interest, Lawyer should take reasonable protective action under Rule 1.14(b) to obtain the appointment of a legal representative to complete the transaction on Senior's behalf.

Identifying your client

Hypothetical C. Aaron Attorney is visited by two adult children of Wendy Widow. Widow's children express their concern about her ability to care for her basic needs and request Attorney's assistance getting her to explore available options. Widow has considerable assets and the children, who are the beneficiaries of her will, express their concerns that the assets might be dissipated before she dies. The children offer to pay Attorney's fee for consulting with Widow.

Attorney meets with Widow, who asks that Attorney prepare a new will leaving her estate to her church.

Hypothetical D. Joe and Susie Golden­-years own a small but successful family business. They and their three children meet with Attorney and ask him to help them sell the business to the children.

Representing a family, not an individual? Identifying the client and establishing the scope of representation at the outset of the attorney-client relationship is crucial. Issues can arise when a lawyer attempts to represent a family as opposed to individual members of the family, which must be addressed at the inception of the relationship. Rule 1.7 of the Illinois Rules of Professional Conduct provides as follows:

(a) Except as provided in paragraph (b), a lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists if:

(1) the representation of one client will be directly adverse to another client; or

(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.

(b) Notwithstanding the existence of a concurrent conflict of interest under paragraph (a), a lawyer may represent a client if:

(1) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client;

(2) the representation is not prohibited by law;

(3) the representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and

(4) each affected client gives informed consent.

Will competing interests compromise the joint representation? As noted by Comment [8] to Rule 1.7 "a conflict of interest exists if there is a significant risk that a lawyer's ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the lawyer's responsibilities or interests." The comment goes on to observe that the question is whether the clients could ultimately have competing interests that could "materially interfere with the lawyer's independent professional judgment" in representing a client.

Comment [29] to Rule 1.7 notes as follows: "In considering whether to represent multiple clients in the same matter, a lawyer should be mindful that if the common representation fails because the potentially adverse interests cannot be reconciled, the result can be additional cost, embarrassment and recrimination...."

As Comment [13] to Rule 1.7 puts it, "A lawyer may be paid from a source other than the client, including a co-client, if the client is informed of that fact and consents and the arrangement does not compromise the lawyer's duty of loyalty and independent judgment to the client...." Thus, Wendy Widow's children can pay Aaron Attorney's fee for representing her, as long as she consents and Attorney does not let that fact compromise his representation of Widow. That almost certainly means in this case that Attorney cannot jointly represent Widow and her children, because of the high risk that they will have competing interests.

In Hypothetical C, to avoid the possible conflict of interest that might otherwise arise, Attorney must - at the outset of his discussions with Widow's children - clarify whom he is representing. If Attorney is representing Widow, he should advise the children that he is obliged to represent Widow's interests, not theirs. This includes pointing out to them that the fact that they are paying his fee does not affect his duty to render independent professional judgment on Widow's behalf and maintain the confidentiality of her information pertaining to the representation.

If Attorney is representing both Widow and her children, he must advise all of them that conflicts of interest may arise that could affect his ability to represent their respective interests and maintain confidentiality. If he were representing both Widow and the children, implementing her request to prepare a new will leaving her estate to her church could violate Rule 1.7's conflict-of-interest provisions.

In Hypothetical D, Attorney must, at the outset of his discussions with the Goldenyears and their children, discuss the conflicts that could arise in the representation of both parties in the sale of the business. Because of the differing interests that may arise, the best course is probably to treat the joint representation of seller and buyer as prohibited under Rule 1.7. Attorney could agree to represent the Goldenyears and advise the children to obtain separate counsel, or vice versa.

What's a privileged communication?

Hypothetical E. Constance Counselor prepares "mirror wills" for John and Jennifer Couple, pursuant to which each leaves his or her assets to the other. Several months later, John visits Counselor and asks her to prepare a new will leaving a substantial portion of his estate to another woman. He instructs Counselor not to disclose the change to Jennifer.

No more "confidences" and "secrets." Rule 1.6 of the new Illinois Rules of Professional Conduct erases the distinction that existed under prior Rule 1.6 between "confidences" and "secrets." Under current Rule 1.6, "information relating to the representation of a client" is protected.

Current Rule 1.6(a) provides: "A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is implicitly authorized in order to carry out the representation, or the disclosure is permitted by paragraph (b) or required by paragraph (c)."

Prior Rule 1.6 prohibited a lawyer from using or revealing a "confidence" (defined as "information protected by the lawyer-client privilege under applicable law") or "secret" (defined as "information gained in the professional relationship that the client has requested be held inviolate or the revelation of which would be embarrassing to or would likely be detrimental to the client") without the client's consent after disclosure (defined as the "communication of information reasonably sufficient to permit the client to appreciate the significance of the matter in question.")

Confidences and multiple representation. Issues can arise when representing multiple clients, such as a family or couple, which require discussion at the outset about the limits of confidentiality.

Comment [30] to Rule 1.7 notes that "the prevailing rule is that, as between commonly represented clients, the [attorney-client] privilege does not attach." Thus, if the parties end up suing each other the privilege will probably not apply, "and the clients should be so advised."

Comment [31] to Rule 1.7 notes as follows:

As to the duty of confidentiality, continued common representation will almost certainly be inadequate if one client asks the lawyer not to disclose to the other client information relevant to the common representation…. The lawyer should, at the outset of the common representation and as part of the process of obtaining each client's informed consent, advise each client that information will be shared and that the lawyer will have to withdraw if one client decides that some matter material to the representation should be kept from the other.....

In the hypothetical above, absent prior agreement to the contrary by both John and Jennifer, John's communication with Counselor would not be privileged. If Counselor acceded to John's request without advising Jennifer, discipline could result.

Conclusion

Representing an elderly client with diminished capacity can raise a number of nettlesome ethics issues, and the answers are sometimes counterintuitive. It is important to always respect your client and always remember who your client is. Most of all, however, it is important to familiarize yourself with the applicable ethics rules and the helpful commentary that accompanies them.


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