August 22, 2017

Ethical Issues for Lawyers Serving on Nonprofit Boards

nonprofitLawyers are invited to join the boards of nonprofit corporations for a variety of reasons, the best of which relate to the judgment and analytical and communication skills lawyers may bring to bear. Service on nonprofit boards, however, often presents lawyers with irresistible opportunities to their exercise their legal training, with potential ethical implications.

One of the primary ethical concerns for attorneys serving on nonprofit boards is whether the attorney is perceived as representing the organization or actually represents the organization. Lawyers serving on nonprofit boards must take care to avoid establishing an accidental attorney-client relationship. If a lawyer does not want to enter into an accidental attorney-client relationship, he or she would be wise to make it clear from the beginning of his or her service, perhaps in writing, that there is no attorney-client relationship. Similarly, attorneys serving on nonprofit boards should emphasize their roles to the other board members.

Conflicts of interest are another ethical pitfall for attorneys serving on nonprofit boards. The lawyer’s independent professional judgment may be compromised by his or her obligation to respect the conduct of the organization regardless of whether that conduct complies with the Colorado Rules of Professional Conduct. There is also the potential for conflict between the organization and the attorney’s law firm.

Although serving on boards of directors for nonprofit organizations presents unique ethical concerns, attorneys provide valuable contributions to boards. Good practices, such as clarifying the lawyer’s role before beginning board service or refraining from voting on issues involving the lawyer’s firm, can help avoid ethical dilemmas.

Ericka Houck Englert, Of Counsel at Davis Graham & Stubbs, will present a one-hour lunch program on December 20, 2016, to discuss ethics for attorneys sitting on nonprofit boards. Register by calling (303) 860-0608, or click the links below.

 

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CLE Program: Ethical Issues for Attorneys Serving on Nonprofit Boards

This CLE presentation will occur on December 20, 2016, at the CBA-CLE offices (1900 Grant Street, Third Floor), from 12 p.m. to 1 p.m. Register for the live program here or register for the webcast here. You may also call (303) 860-0608 to register.

Can’t make the live program? Order the homestudy here: MP3Video OnDemand.

Colorado Judicial Ethics Advisory Opinion 2016-01 Released

On Wednesday, February 24, 2016, the Colorado Judicial Ethics Advisory Board issued C.J.E.A.B. Opinion 2016-01. This opinion addresses whether it is appropriate for a judge sitting on a nonprofit board to personally write or call donors to thank them for their contributions. The requesting judge asked the Advisory Board to consider if such communication would be considered fundraising in violation of the Colorado Code of Judicial Conduct.

The Advisory Board considered applicable provisions of the Code of Judicial Conduct and determined that, in cases where the judge is not soliciting further donations, implicitly or explicitly, it is acceptable for the judge to personally thank donors for their contributions in her role as board member of the nonprofit organization.

The Colorado Judicial Ethics Advisory Board is a committee of the Colorado Supreme Court consisting of judges and non-judges who provide ethical advice to judicial officers who request an opinion on prospective conduct. There are seven committee members: four judges, one lawyer, one non-lawyer citizen, and one law professor. Any Colorado judicial officer may request an opinion. Requests may be submitted to any member of the Advisory Board or to Christine Markman, staff attorney to the Colorado Supreme Court. Requests may be submitted on the Advisory Board’s form, JDF 2.

The full text of C.J.E.A.B. 2016-01 is available here. All of the C.J.E.A.B. opinions are available here.

Colorado Supreme Court: Board Members of Water Conservancy District Serving Expired Terms May Continue to Vote

The Colorado Supreme Court issued its opinion in Concerning the Application for Water Rights of Yellow Jacket Water Conservancy District in Rio Blanco County: Yellow Jacket Water Conservancy District v. Livingston on Monday, December 23, 2013.

Diligence Applications—Holdover Directors—Water Conservancy Act.

The Supreme Court held that the holdover provision in the Water Conservancy Act, CRS § 37-45-114(1)(b), enables a holdover director to continue to serve as a de jure officer and does not impose a temporal limit on his or her authority to act on behalf of a water district. The water court’s judgment was reversed and the case was remanded for further proceedings.

Summary and full case available here.