Tax Advisors and Conflicted Citizens

Abstract

How should we think about the obligations of a lawyer who counsels and provides legal advice outside of litigation? thousands of lawyers are involved every day in advising clients in this setting. these lawyers counsel companies or individuals on how they can benefit from or avoid violating statutes, regulations, and other sources of law. Legal counsellors do their job behind closed doors. they engage in conversations that are usually protected from disclosure. they move in the shadows, and their influence can be hard to trace. that influence can be profound, however. It can determine who is exposed to what chemicals, who keeps and who loses their jobs, who will be able to count on retirement savings and who won’t. rules of professional responsibility devote remarkably little sustained attention to the role of the advisor. American Bar Association (ABA) Model rule 2.1 is the only rule that explicitly refers to the lawyer as advisor. It simply says that a lawyer ‘shall exercise independent professional judgment and render candid advice’. In doing so, an advisor ‘may’ refer to considerations such as ‘moral, economic, social and political factors’. By contrast, most of the other Model rules are premised on a conception of the lawyer as an advocate. this model is relatively clear and straightforward, and can provide an appealing default template for thinking about the obligations of the advisor. It suggests that the lawyer take a relatively aggressive approach to interpreting the legal provisions applicable to a client in order to maximise the client’s freedom of action. If a client’s behaviour would be permissible according to the literal terms of a statute, for instance, an advocate should urge the client to behave in that way on the ground that assessing the behaviour’s consistency with the purposes of the statute is inappropriate. If the literal terms of the law proscribe behaviour in which the client is engaged, the advisor as advocate may counsel to continue it on the ground that it is in accordance with the law’s purposes. While an advisor who acts as an advocate may adopt either approach, Doreen McBarnet and christopher Whelan argue that advisors who act as advocates in the regulatory context often focus on the literal terms of the law to help the client engage in what they call ‘creative compliance’. this involves structuring transactions, relationships or entities according to