Professors Jacqueline Nolan-Haley and Bruce Green were quoted in Law360 in an article analyzing the concerns of neutrality in investigations.
After legal assistants complained about sexist and racist conduct at Sanford Heisler Sharp LLP in June, name partner and chairman David Sanford repeatedly told staffers that the firm hired a “third-party neutral” as an “independent investigator,” according to emails he sent between July 1 and Aug. 10 that were obtained by Law360, as well as accounts from current and former employees.
But one Sanford Heisler attorney confirmed to Law360 that the investigator said “definitively that he was not a third-party neutral” and was actually retained by people with a relationship with the firm. The investigator wouldn’t say if he was reporting to Sanford Heisler’s outside counsel, according to the attorney.
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Jacqueline Nolan-Haley, a Fordham University law professor who directs the school’s ADR & Conflict Resolution Program and the Mediation Clinic, said firms “in trouble” often hire attorneys to serve as fact-finders but said labeling them as third-party neutrals “shouldn’t be protective covering.”
“There’s a defined understanding of a third-party neutral — he’s helping two or more persons who are not clients to reach a resolution,” Nolan-Haley said. “There should be transparency in all of this, and the employees are entitled to know with whom they are dealing.”
A true third-party neutral cannot have an attorney-client relationship with any party in a dispute under an American Bar Association model rule adopted in 2002.
Attorneys who serve as third-party neutrals must be open about their role in a dispute and inform unrepresented parties that they are not representing them under the ABA Model Rules of Professional Conduct. They’re also supposed to explain the difference between their role as a third-party neutral and a lawyer’s position when they represent a client.
“The reason is obvious: The parties might otherwise misunderstand the neutral lawyer’s role and erroneously believe that the lawyer is looking out for their interests as their lawyer and undertaking fiduciary obligations to them,” said Bruce Green, director of the Stein Center for Law and Ethics at Fordham Law School.