Ethical Dilemmas of the Volunteer Lawyer/nonprofit Director
| Publication year | 1994 |
| Pages | 2735 |
| Citation | Vol. 23 No. 12 Pg. 2735 |
1994, December, Pg. 2735. Ethical Dilemmas of the Volunteer Lawyer/Nonprofit Director
Whether motivated by genuine compassion or a sense of civic duty, a desire to gain greater recognition in the community or simply an inability to say "no," most lawyers have accepted, at one time or another, an invitation to serve on the board of directors of a nonprofit corporation. Few, however, may have considered either the personal and professional liabilities or the possible prejudicial consequences to the corporation that might result from community service of this nature.
Unfortunately, the exact scope of a lawyer's responsibilities in this respect is somewhat speculative, since the case law and commentary in this area have almost uniformly addressed only the implications of lawyers serving on the boards of corporations (invariably for-profit) with which they maintain an established lawyer-client relationship.(fn1) Nonetheless, although fundamentally distinguishable, the available authorities do provide useful guidance regarding what is the principal focus of this article, the ethical responsibilities and dilemmas of lawyers who serve---as volunteers---on the boards of nonprofit corporations that are not their acknowledged clients.(fn2)
From the perspective of a nonprofit corporation, the distinction between a volunteer director who happens to be a lawyer and compensated outside counsel who also serves on the board is not always apparent and may not even be particularly meaningful. In either case, the corporation quite properly anticipates that several substantial advantages will result from the presence of one or more lawyers on its board. Apart from their judgment and the experience with business matters generally that lawyers are typically expected to contribute, corporations may assume that a lawyer's training and expertise will enable the board, at an early stage in its deliberations, to recognize and avoid decisions that could lead to possible legal complications.
Thus, even in the case of volunteer lawyer/directors, it may not always be clear, either to the lawyer involved or to the board as a whole, whether the lawyer/director purposefully renders legal advice on a given occasion or merely speaks as a member of the board who incidentally possesses a legal background. Smaller nonprofit organizations in particular that lack the resources to engage outside counsel on a regular basis may tend to rely on a lawyer/director for captive legal guidance. To a lawyer in such a situation, providing a legal perspective on issues that come before the board may prove to be irresistible.
The fact that the lawyer is not compensated for acting in what may amount to a professional capacity is not necessarily sufficient to avoid the establishment of a lawyer-client relationship. For example, New Jersey Supreme Court Advisory Committee on Professional Ethics Opinion 671, issued on April 5, 1993, described a lawyer who volunteered one night per week to provide counseling on domestic violence, divorce and child support issues to the clients of a nonprofit corporation that supported abused women. Although both the organization and the lawyer routinely advised the organization's clients that the counseling services were not intended to create any attorney-client relationship and that no attorney-client privilege would apply, the Opinion concluded that such a relationship did arise when the client, in a one-on-one conference, relied on advice with regard to the particular facts of her case. The Opinion also stated that the "same ethical rules apply, regardless of whether the legal advice or representation is provided on a compensated or pro bono basis" and that there is "no separate or more relaxed version of the applicable ethical precepts for attorneys providing pro bono advice."(fn3)
It is not unusual for nonprofit corporations to look to a lawyer/director for assistance with what the corporation's management views as routine legal matters---reviewing an office lease, drafting an employment contract with the executive director or attending to revisions to the corporate bylaws. While a variety of matters of this nature may in fact fall within the scope of competence assumed by a general practitioner, it has become...
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