attorney commits professional misconduct when she includes a provision that is potentially invalid . 18 When a lawyer includes a potentially invalid provision in a contract , she is likely trying to contract around some mandatory rule of law in a way that benefits her client . 19 While drafting , she should contemplate the possibility of future litigation challenging the contract and have a good faith basis for thinking the subject provision is valid . 20 Further , where there is doubt as to a provision ’ s validity , a prudent course of conduct would be to disclose both to the client and to third parties that the provision might be invalid in certain jurisdictions . 21
Transactional matters implicate professional conduct concerns in contexts that are often simultaneously adversarial and collaborative . Professional values embodied in the Rules , such as truthfulness and transparency , are at the core of any transactional representation . Accordingly , attorneys should draft transactional documents against the backdrop of what the Rules require .
1 Gregory M . Duhl , The Ethics of Contract Drafting , 14 LEWIS & CLARK L . REV . 989 , 995 ( 2010 ).
2
Rule 3.1 provides : “ A lawyer shall not bring or defend a proceeding , or assert or controvert an issue therein , unless there is a basis in law and fact for doing so that is not frivolous , which includes a good faith argument for an extension , modification or reversal of existing law .”
3
See Rule 3.1 , cmts . 1 and 2 .
4
See , e . g ., Rule 1.7 ( a ), which states that “[ a ] lawyer shall not represent a client if the lawyer ’ s ability to consider , recommend , or carry out a course of action on behalf of the client will be adversely affected by the lawyer ’ s responsibilities to another client or to a third person , or by the lawyer ’ s own interests .” See also Rule 1.7 ( b ) ( providing that “[ a ] lawyer shall not represent a client when the lawyer ’ s own interests are likely to adversely affect the representation .”).
5
Rule 2.1 .
6
Duhl , supra note 1 , at 995 . See also Paul D . Carrington , Unconscionable Lawyers , 19 GA . ST . U . L . REV . 361 , 379-84 ( 2002 ) and Christina L . Kunz , The Ethics of Invalid and “ Iffy ” Contract Clauses , 40 LOY . L . A . L . REV . 487 ( 2006 ).
7
Rule 1.2 ( d ) provides that “[ a ] lawyer shall not counsel a client to engage , or assist a client , in conduct that the lawyer knows is criminal or fraudulent , but a lawyer may discuss the legal consequences of any proposed course of conduct with a client and may counsel or assist a client to make a good faith effort to determine the validity , scope , meaning or application of the law .”
8
Rule 4.1 provides that “[ i ] n the course of representing a client a lawyer shall not make a statement to a third person of fact or law that the lawyer knows to be false .” See also Michael S . McGinniss , Breaking Faith : Machiavelli and Moral Risks in Lawyer Negotiation , 91 N . D . L . Rev . 247 , 258 ( 2015 ) ( noting that Rule 4.1 does not require materiality for the proscribed conduct ).
9
Rule 8.4 ( c ) provides that “[ i ] t is professional misconduct for a lawyer to engage in conduct involving dishonesty , fraud , deceit , or misrepresentation that reflects adversely on the lawyer ’ s fitness as a lawyer .”
10
Rule 1.0 ( e ).
11
Id . cmt . 5 .
12
Duhl supra note 1 at 1013 .
13
N . D . Cent . Code Ann . § 9-08-06 ( 2015 ). The statute bars non-compete agreements except in the context of contracts for the sale of business or a partnership dissolution . Even then , the non-compete agreement is subject to a reasonableness test with regard to the scope of the conduct the agreement restricts . Id .
14
See Rule 1.0 ( e ). There need not be reliance or damages , however . Id . cmt . 5 .
15
That said , negligent or irresponsible use of a form may implicate Rule 1.1 ’ s duty to “ provide competent representation to a client .” Rule 1.1 .
16
Rule 1.0 ( g ).
17
See Rule 1.0 ( g ) ( permitting an inference of knowledge based on the circumstances ); see also McGinniss , supra note 8 at 262-66 ( explaining why lawyers should be held to a “ higher standard of truthfulness ” under Rule 4.3 when “ negotiating with unrepresented persons ”).
18
Carrington , supra note 6 , at 371-73 .
19
Kunz , supra note 6 , at 508 – 09 .
20
See Rule 3.1 (“ A lawyer shall not bring or defend a proceeding [ before a tribunal ], or assert or controvert an issue therein , unless there is a basis in law and fact for doing so that is not frivolous , which includes a good faith argument for an extension , modification or reversal of existing law .”).
21
Duhl , supra note 1 , at 1032 .
Thank You On behalf of Real Property Section & SBAND , I would like to thank the following for presenting at our 2016 Real Property Seminar :
Jannelle Combs Jeffery Dobberpuhl Kara Erickson Casey Furey
Ray German Sonja Greenwaldt Ken Hedge Chris Stoneback
The expertise of professionals like you is the key to a strong CLE program for our members . We greatly appreciate you sharing your knowledge and expertise with us .
Please join us in Bismarck on December 7 & 8 at the Kelly Inn for our 2017 RPPT Seminar .
Grant Shaft , Section Chair
WINTER 2017 11