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  • Gregory Chan

The Environment v. The Legal Profession: The Role of the Legal Community in Tackling Climate Change

Introduction

There is an undeniable tension between lawyers acting under their clients’ instructions and those advocating for themselves or, even more broadly, the public interest. On one hand, the “duty of loyalty” to clients has led to a majority of firms branding themselves as “service-oriented,” meaning they are acting in their client’s best interest. On the other, this overzealous, client-centric practice often overshadows the consequences of the services or advice lawyers provide to clients. Indeed, as lawyers attract work from clients with loose environmental regulations, they become accused of assisting clients to weave around the increasingly onerous environmental law obligations they face when bridging the gap between law and policy. Yet, as Professor Stephen Vaughan powerfully advocated for, we should abandon the old “lawfully awful” practices in favor of greater public interest considerations.

 

However, what would this entail? Particularly in the commercial world, lawyers are often bound by clients’ instructions when acting for them. Otherwise, concerns about the profession and a lawyer’s individual practice would inadvertently arise. Indeed, if lawyers were to act to “influence” a company’s decisions based on their own interests, the foundation of the profession might be inadvertently shaken. After all, legal advice is highly specialized; clients are often deferential to lawyers. Yet, this deference must similarly not be abused.

 

In this regard, one must thus query the extent of the incorporation of sociopolitical concerns in legal advice. Indeed, to avoid “lawfully awful” lawyering, one must ask two fundamental questions: first, what the extent of legal discretion is when rendering advice to clients, and second, if there is discretion, how it would play out in the context of environmental concerns.

 

Discretion of Legal Advice

Broadly, it should be said that attorneys could be capable of being positive drivers for change independent of a client’s instruction. The ABA Model Rules of Professional Conduct, specifically Rule 2.1, states that "a lawyer may refer not only to law but to other considerations such as moral, economic, social, and political factors that may be relevant to the client's situation.”

 

Other jurisdictions adopt a similar pattern. The Solicitors Regulation Authority (SRA) in the United Kingdom notes that the client’s instructions are but one of the principles governing a solicitor’s conduct. However, other key tenets require lawyers to act to uphold the rule of law and to maintain public trust and confidence in the profession. Read alongside the Law Society’s Climate Resolution on a solicitor’s “climate-conscious” practices, these principles can be said to give practitioners wider discretion to incorporate environmental concerns into their advice as opposed to acting purely on their client’s instructions.

 

These lessons were shared with the ABA at COP 27, where the ABA engaged with the SRA to discuss the role of lawyers in a changing economy. Regretfully, they seemed to fall on deaf ears. The ABA’s subsequent 2019 resolution merely noted that attorneys should engage in more pro-bono work, staying silent on the role of public interests, which is particularly worrying and might limit a lawyer’s ability to incorporate environmental factors. Or would it?

 

Take, for instance, a lawyer engaged to advise a business went beyond their client's concerns and incorporated environmental risks in their advice. Would they be disciplined?

 

While the US has yet to comment specifically on the matter, perhaps some insights can be taken from relevant English cases. First, Gosfield School Ltd. v. Birkett Long, which holds that a solicitor has a duty to point out transactional risks which are obvious to solicitors but not within the contemplation of their clients. In County Personnel v. Alan R Pulver & Co., this was extended to solicitors having a duty to advise clients of risks which “might even allude an intelligent layman,” emphasizing the objective nature of the test. This was later extended, with the Court noting that in situations where the risk is particularly obvious, solicitors must call attention to these risks for their clients. Finally, solicitors also cannot express no opinion where it was obvious that their clients were engaging in an objectively unwise decision.

 

In that regard, one inevitably observes that practitioners generally enjoy significant discretion when making legal advice. Nonetheless, it remains unlikely that their livelihoods would be in jeopardy. Conversely, one might go further to suggest that environmental considerations should instead, be included in legal advice within modern commercial practice. Indeed, Mark Carney, former governor of the Bank of England and current UN Special Envoy for Climate Action, famously noted that the next threat for the commercial world stems from climate risks and the potential catastrophic spillover effects. Hence, by including environmental risks, lawyers would arguably be providing a holistic view of “economic, social, and political” factors.

 

Indeed, this latter view might be preferable; it should not be said that environmental concerns should be neglected as a whole purely because they fall outside the scope of business. Rather, they form new “considerations” to be advised upon.

 

The Next Steps

Having underscored that there is broad capacity for legal practitioners to play a role in the climate crisis, and there are opportunities and means for them to do so, the next obvious question is how they can achieve this. Indeed, this section focuses on contracts as the core building block of commercial practice.

 

While commercial agreements mark the beginning of parties’ relationships in a private setting, they similarly present the best opportunity for practitioners to include pro-environmental clauses. However, this does not mean practitioners should covertly incorporate these provisions; rather, they should advise clients that these amendments and additional mechanisms reflect current best practices, assisting them in navigating obligations under new legislative trends.

 

In drafting and incorporating these provisions into contracts, one can look to best-practice mechanisms currently prepared for use by various initiatives made by the legal community. For instance, The Chancery Lane Project (TCLP) has been particularly active in preparing model clauses, as well as full standard form contracts, for practitioners across various industries. These include supply contracts that contain mechanisms for entire supply chains to adopt environmental targets and clauses on the transparency of energy sources when producing the goods, clauses on commercial leases, climate-based discretionary clauses, and many more. Indeed, the recent 2022 TCLP impact report indicated a positive growing trend of practitioners adopting their clauses, and an upward growth in members and funding which the initiative has gained in recent times.

 

In a similar vein, dispute-resolution clauses have seen an uptick in ‘green’ activity. Lucy Greenwood’s Campaign for Greener Arbitration, which includes model clauses to amend traditional arbitral practice to become ‘greener’, has seen an upsurge in popularity. Lucia Bíziková refers to the pledge as the gold-standard, and discusses e-filing to reduce paper-wastage with bundles, greater discretion for virtual hearings to reduce traveling-based emissions, and environmental impact assessments on sustainability measures during the dispute in accordance with the relevant governing laws. Kim Franklin KC similarly goes further to note that various arbitral institutions have adopted mechanisms and frameworks to incorporate these green mechanisms into their procedural rules. Hence, with these mechanisms in place, it would be rather simple to give in to parties’ wishes under an agreed-upon green arbitration clause within the disputed contract.

 

Incorporating these provisions, however, would require cooperation amongst a multitude of stakeholders: the party on the opposite end of the negotiating table, practitioners representing the other parties, the represented client’s wishes, as well as the overall business environment. After all, incorporating these novel clauses into agreements requires party consent. At first, they may be reluctant to change. It is therefore the lawyer’s task to advise them of the numerous practical benefits, such as reducing overall costs and efficiency through these legal innovations. Whle empirical studies note that there is an ongoing trend to incorporate more of these climate-friendly clauses, if they were truly to become mainstream in the commercial setting, both practitioners and commercial parties must seek to be more open-minded and embrace the change in the commercial landscape.

 

Conclusion

As the climate crisis worsens, the legal profession should look for ways to step up and play their part in tackling it. However lawyers choose to achieve their goals, the end result should be that of net-zero, climate-friendly conduct and practices, and perhaps even carbon-negative status. Thus far, this paper has highlighted but one example of how commercial lawyers can move forward and play their part, all while maintaining the integrity of the profession and acting in the client’s best interest. There are many more tools that can be engaged with to help lawyers make a difference in the climate emergency. The only question is: will they?


Gregory Chan is a current LLM student at New York University specializing in International Business Regulation, Litigation and Arbitration, and current research assistant to Professor Franco Ferrari and Professor Linda Silberman. Prior to commencing his LLM, he worked at UNIDROIT Digital Assets and Private Law working group, disputes groups of various firms in Singapore and was a mentee to Svenja Wachtel for the Young Energy Disputes Arbitration Centre mentorship program. He completed his LLB at King’s College London, and was a member of the Willem C. Vis Commercial Arbitration Moot Team as well as the Cross-Examination Moot Team.

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