20 April 2020

Ethical dilemmas faced by in-house lawyers - and how to respond

Published on 20 April 2020

In-house lawyers are no strangers to ethical dilemmas. The very nature and position of their role within an organisation - as gatekeepers of the law employed exclusively by one ‘client’ - places them in unique ethical situations.

Insights spoke to veteran in-house lawyer John Steadman on his experiences with ethical dilemmas, and his advice on how to manage them.

Conflicting priorities

“The biggest challenge is that your client is the company or organisation that employs you, not the managers or employees of that organisation with whom you will build relationships over time,” explained John. “As a general rule, priorities will broadly align but there may be times where this is not the case.  For example, a salesperson who gets a bonus on making a sale may be prepared to say or promise things that could create problems for your client in the future.”

Distinguishing your client, the organisation, from its employees - the people most likely to expose the organisation to liability - presents one of the biggest challenges for in-house lawyers. It is likely personal relationships may come into conflict with the best interests of the organisation.

“Never forget your duty is to protect your client, not the people who you work with on a daily basis,” said John. “This can sometimes be quite challenging. Never put yourself in a position where you are not acting in the best interests of your client.”

Never “legitimise” questionable behaviour

As a trusted legal authority within your organisation, it is vital to be mindful of what you say and how it is perceived. 

“Never allow yourself to be used to ‘legitimise’ questionable behaviour,” warned John. “From time to time you may be requested to front a discussion and say certain things as - despite the lawyer jokes - people generally believe what lawyers say.  Never say anything you would not be comfortable saying or admitting to at a later date.  It takes years to develop a reputation as a lawyer that can be trusted and is ethical but only takes minutes to potentially ruin it.”

Ensure you receive sufficient training

Few organisations have the resources or internal legal expertise to hire and train junior lawyers. Moving in-house early in one’s career may not be advisable.

“Most in-house legal roles look for a minimum of three to five years of experience,” said John. “ To give yourself the best opportunity, identify the sector you want to work in and then get as much experience as you can in private practice to set yourself up for a move in-house.  Sometimes in larger firms, secondment opportunities may come up and this can lead to permanent roles in an in-house legal team.”

Keep up to speed with emerging ethical dilemmas

The growth of in-house legal teams is presenting new and varying ethical dilemmas every day. Practical courses and seminars offer the best way to understand what ethical dilemmas confront in-house lawyers, learn how to best respond, and grow your network.

“The NZ In-House Lawyers Association (ILANZ) is a useful resource and try to build your network with other in-house lawyers,” said John. “In addition, undertaking the College of Law’s Practical Masters degree with an in-house specialisation will also assist those wanting to move in-house.  In the Master’s course the emphasis is on practical skills you will need to be a successful in-house lawyer.”

John has relished his experiences as an in-house lawyer. Career highlights include the negotiation and drafting significant agreements with global suppliers such as Microsoft, Apple, Sony, Google, Cisco, and Samsung.

“In private practice I enjoyed the technical aspects of law but did not enjoy the administrative side of private practice, particularly timesheets and monthly billing,” said John. “Moving in-house removed those issues and allowed me to get much closer to the business and work on large technology transactions.”