Can a lawyer who represents a corporation or other organization also serve on its board of directors, or as board chair?

Plain-English summary

The committee was asked what ethical constraints apply when a lawyer for a corporation or other organization also serves on its board, and whether serving as board chair adds anything. Without endorsing the practice, and noting commentators have criticized it, the committee held there is no per se rule against a lawyer serving as a director of a client organization, consistent with opinions from several jurisdictions and ABA Informal Opinion C-431.

The committee distilled three governing constraints. First, the lawyer may not use the directorship as a feeder for legal practice; DR 2-103(A) bars improper solicitation, and a lawyer/director may not take part in the board's decision to retain the lawyer or the lawyer's firm as counsel. Second, the lawyer must disclose to the client the risk of losing the attorney-client privilege and the other consequences of the dual role. Third, the lawyer must keep independent professional judgment free of the influences the directorship creates (DR 5-101(A); EC 5-1, 5-2), and is disqualified from any matter where the lawyer's own interests as counsel are at stake, such as a controversy between the organization and its directors, advice on directors' personal liability, or where directorship fees are financially significant to the lawyer. The committee endorsed the Comment to Model Rule 1.7 as accurately reflecting these concerns under the New York Code.

The committee added that DR 5-102 may require the lawyer to withdraw as counsel if the lawyer becomes a potential witness. As to board chair, it saw no different analysis, but observed that a chair's greater involvement in management makes conflicts more likely; if the chair's non-participation in conflicted matters would seriously impair the board, the lawyer should not serve as chair. Where a lawyer would have to decline or withdraw from the board seat, DR 5-105(D) bars any partner or associate from taking it.

Currency note

This opinion was issued in 1988, before New York replaced the Code of Professional Responsibility with the Rules of Professional Conduct in 2009 (conflicts of interest now appear at Rule 1.7, and the director-service concern is addressed in the Comment to that rule). Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a lawyer for a company also sit on its board of directors?

A: Yes, with conditions. The committee held board service is not per se improper if the lawyer does not use the seat as a feeder for legal work, discloses the risks including possible loss of privilege, and keeps independent professional judgment.

Q: When must the lawyer/director step away from a matter?

A: Whenever the lawyer's own interests as counsel are implicated. The committee held the lawyer is disqualified from advising on controversies between the organization and its directors, directors' personal liability, or any matter where significant directorship fees could affect the lawyer's judgment.

Q: Does serving as board chair change the analysis?

A: The standard is the same, but conflicts are more likely. The committee held that if the chair's required non-participation in conflicted matters would seriously impair the board, the lawyer should not serve as chair.

Q: If the lawyer must leave the board, can a partner take the seat?

A: No. The committee held that under DR 5-105(D), if the lawyer must decline or withdraw from the board, no partner or associate of that lawyer may accept the position.

Background and rules framework

The opinion interpreted DR 2-103(A) (solicitation), DR 5-101(A) with EC 5-1 and 5-2 (independent judgment and personal-interest conflicts), DR 5-102 with EC 5-9 and 5-10 (lawyer as witness), DR 1-102(A)(6) (conduct adversely reflecting on fitness), and DR 5-105(D) (imputation). It treated the Comment to Model Rule 1.7 as an accurate statement of the relevant concerns, which is the closest current analogue.

Citations and references

Rules of Professional Conduct:

• MR 1.7 (conflicts of interest; the Comment addresses a lawyer serving as a director of a client organization)
• NY DR 1-102(A)(6); DR 2-103(A); DR 5-101(A); DR 5-102; DR 5-105(D); EC 5-1, 5-2, 5-9, 5-10

Other opinions cited:

• ABA Informal Op. C-431 (1961): a lawyer may serve as a director or chair of a client's board
• Illinois Op. 483 (1975): disclosure of the potential loss of the attorney-client privilege
• N.Y. City 611 (1942): a lawyer/director may not participate in the decision to retain the lawyer as counsel

See also

• NY State Bar Op. 743: Lawyer for a labor union as an organization client
• NY State Bar Op. 650: Corporate compliance program and employee reporting
• NY State Bar Op. 1153: A county attorney on a community college board

Source

• Landing page: https://nysba.org/opinion-589/