Q: Dear Ethics Lawyer, I am an associate working with a partner on a substantial matter. The client has asked for advice concerning the potential exposure and whether it should be estimated and disclosed as a material matter to audit personnel working on the company’s financial statements. The partner believes strongly that the matter is sufficiently speculative that it need not be disclosed. However, I believe that, although arguable, the partner is wrong and that a failure to disclose the matter would cause the client to misstate its contingent liabilities. The partner considered my position, but rejected it and has determined to advise the client based on his position. What may or must I do under the ethics rules?
A: You are in an awkward position requiring some careful analysis – welcome to the practice of law! Model Rule 5.2(a) makes it clear that the Rules of Professional Conduct apply to you, even if you are acting at the direction of another, but subsection (b) gives you some meaningful protection as a “subordinate lawyer,” acting at the direction of the partner as a “supervisory lawyer.” You do not violate the Rules when acting per the partner’s instructions if the partner’s instruction is a “reasonable resolution of an arguable question of professional duty.”
You describe the partner’s resolution as “arguable.” Please consider whether the partner’s resolution is “reasonable” under the standard set forth in Rule 5.2. I would advise you also to consult with firm counsel or otherwise with firm or practice leadership, or even to obtain outside counsel on the issue. You should not lightly go against the partner’s instructions, but your law license and reputation are your career. Use the resources available to you to help resolve this issue.