Navigating Ethical Issues When Parties Change Mid-Project

• Pages: 23-35
• Date: 01 October 2025
• Published date: 01 October 2025
• Author: Samuel D. Gregory,Matthew D. Peng
• Subject Matter: Derecho Público y Administrativo

Published in The Construction Lawyer Volume 44, Number 4, ©2025 by the American Bar Association. Reproduced with permission.

All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in

an electronic database or retrieval system without the express written consent of the American Bar Association.

Forum on Construction Law The Construction Lawyer Fall 2025

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Navigating Ethical Issues When Parties Change

Mid-Project

Samuel D. Gregory and Matthew D. Peng

Samuel D. Gregory is an attorney with Butler Snaow LLP in Ridgeland, MS.

Matthew D. Peng is an attorney with Gordon Rees Scully Mansukhani, LLP in San Francisco, CA.

Introduction

When onboarding a new client or beginning a new engagement, a conicts check is one of the rst things

that is done. Running conicts on the front end is straightforward and common, and most lawyers and rms

have their own processes and conicts departments already in place to make such checks run smoothly and

eciently. However, navigating conicts of interest becomes more dicult if parties change during the course

of a project or engagement.

This is especially so if the lawyer has no advanced knowledge of the change and suddenly finds himself/

herself with existing clients on opposite sides. This article will address the multiplicity of issues that need to be

analyzed when a lawyer finds himself/herself in this type of situation.

Overview of Hypothetical Situation

To avoid analyzing issues in a vacuum, this article will walk through an analysis of the following hypothetical:

e attorney represented the owner in the creation of the development documents and then helped

dra the construction contract documents. At the time, no conict existed because the general contrac-

tor either was unknown or was not a client of the attorney. en, halfway through the project, the owner

switches general contractors and the new general contractor is a client of the attorney. What are the next

steps for the attorney? What happens if the project goes sideways?

Initially, the attorney’s representation of the owner in drafting contracts presents no conflict. The potential

for a conflict emerges when the owner hires a new general contractor who is already a client of the attorney.

The conflict arises when the interests of the owner and the new general contractor could potentially diverge,

necessitating the attorney’s ethical management of the situation.

Identifying the Need to Reassess Conflicts

Prior to commencing a conict-of-interest analysis, an attorney needs to identify the need to do so in the rst

place. is can necessitate an evaluation of how a change in a project’s dynamics could impact a lawyer’s own

representation(s) and ethical obligations.

As soon as a lawyer learns of a change in parties, or even a potential change, the attorney should perform the

same conflicts check that would have been run at the beginning of an engagement. And if the conflicts check

reveals that a new party is or was previously represented by the lawyer or the lawyer’s firm, then an analysis

must be done to determine whether an actual or potential conflict exists and, if so, whether such a conflict can

potentially be the subject of consent.