What is a Dual Representation Agreement with a Lawyer and When is it Used?

by | Feb 19, 2016 | Intellectual Property, Non-Profits, U.S. Private and Emerging Business

ProsCons             Deciding when to invest in an attorney is an important decision. Frequently, people hope to save money and have one attorney or agent represent the interests of both individuals on either side of a dispute. However, in order to do so the attorney must comply with strict disclosure rules for the state in which he or she is practicing. Both parties on either side of the conflict must be made aware that there is a potential conflict, that they have the right to independent representation, and they generally are required to sign a written agreements acknowledging they have been made well aware of their rights. Sometimes this agreement is reached and both parties and the attorney will review and be asked to sign a conflict of dual representation agreement. In this agreement you are consenting to allow one attorney represent both parties. If both parties have a similar objective then this could be a very cost effect decision. It is usually used for simple legal matters in which both parties share a common interest. However, it is important to note that in the instances where clients have two interests that directly, materially, and substantially conflict with one another, then legal counsel may not represent both individuals even after the parties have consented to representation with a dual representation agreement. These agreements are often used in real estate transfers where one party is selling property to another without going through a realtor. The price has been determined and the legal documents just need to be filled out and filed.

In addition, there are several things in which an attorney must be aware, prior to signing this agreement. One of the most important factors is attorney client confidentiality. When both parties are represented by a single attorney, the attorney is not able to withhold information from either party. Therefore, there is no confidentiality between the dually represented parties. Further, if the parties later decide to seek separate representation, several states will allow the attorney to use the prior information shared amongst the parties with the remaining client, as long as it is not to directly harm the prior client. If one signs a conflict of dual representation agreement, one is agreeing that the attorney may share all information between both parties which can include financial information and other personal information as well. Possible conflicts of interest may arise between clients due to differences in opinions on how things should be handled. When this happens, it is very difficult for the attorney to represent the individual best interest of each party. If there is even the slightest chance that there could be a conflict, it would be in the best interest of all parties to hire separate legal counsel to ensure that the best interest of all parties are being met.

After discussing their wish to be represented by the same attorney, the attorney is required to draft a written agreement disclosing all the rights and obligations of legal counsel and the parties. This can be a short and to the point agreement or a very long and detailed one depending on the attorney and what your legal matter is. The attorney is legally obligated to tell you that it would be in your best interest to hire separate counsel. However, if you choose to continue with a single lawyer, then you are aware that a conflict may arise. You will agree that you are aware that there will be no attorney client confidentiality between the parties. If you are in agreement then all parties will be asked to sign the agreement.

Conflict of dual representation agreements are not generally recommended due largely to the fact that a conflict will arise at some point and create an even bigger problem. Prior to signing this agreement, all parties should be completely sure they are in agreement as to how matters should be handled. They should also be clear on the steps they will take if and when a conflict arises and how it will be settled. When choosing an attorney to handle your legal matters, make sure to find a qualified business attorney who is knowledgeable in this field and will advise you of your rights and options.