Changes to Model Rules and New Corporate Governance Resolution: a Reaction to Corporate Malfeasance

• Publication year: 2003
• Pages: 73
• Citation: Vol. 32 No. 10 Pg. 73

32 Colo.Law. 73 Colorado Lawyer 2003.

2003, October, Pg. 73. Changes to Model Rules and New Corporate Governance Resolution: A Reaction to Corporate Malfeasance

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73

Vol. 32, No. 10, Pg. 73

The Colorado Lawyer
October 2003
Vol. 32, No. 10 [Page 73]

Departments
ABA Delegates' Report
Changes to Model Rules and New Corporate Governance Resolution: A Reaction to Corporate Malfeasance
by Chris Little

Chris Little, Greenwood Village, is a shareholder of Montgomery, Little & McGrew, P.C., and a Denver Bar Association representative on the ABA House of Delegates

Chris Little

At the August 2003 meeting of the ABA House of Delegates, the House adopted changes to two ABA Model Rules of Professional Conduct ("Model Rules") and a resolution providing guidelines for corporate governance. The changes are a direct result of recent dramatic corporate failures leading to catastrophic losses for investors, employees, and pensioners [See discussion in Fred Rodgers' report on page 71.]

Model Rule 1.6

The House voted 218 - 201 to adopt a revision to Model Rule 1.6 (Confidentiality of Information). The revised rule requires lawyers to reveal client confidences if the lawyer believes the disclosure will prevent the client from committing a crime or fraud that would lead to substantial injury to the financial interests or property of another

As adopted, Rule 1.6 reads:

(a) A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is permitted by paragraph (b).

(b) A lawyer may reveal informed information relating to the representation of a client to the extent the lawyer reasonably believes necessary:

(1) to prevent reasonably certain death or substantial bodily harm;

(2) to prevent the client from committing a crime or fraud that is reasonably certain to result in substantial injury to the financial interests or property of another and in furtherance of which the client has used or is using the lawyer's services;

(3) to prevent, mitigate or rectify substantial injury to the financial interests or property of another that is reasonably certain to result or has resulted from the client's commission of a crime or fraud in furtherance of which the client has used the lawyer's services;

(4) to secure legal advice about the lawyer's compliance with these Rules;

(5) to establish a claim...