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The Usage of What Country: A Critical Analysis of Legal Ethics in Transnational Legal Practice

Published online by Cambridge University Press:  20 August 2019

César S. Arjona
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Abstract

This article maintains that the standard conception of legal ethics – the so-called ‘theory of amorality’ – is highly dependent on context and cannot be consistently applied to transnational legal practice. After defining in some detail the basic tenets of the standard conception, I identify its main assumptions, namely, (i) that a legal relation is an agency relation in which both lawyer and client are individual moral agents, (ii) that such relation is connected to a litigation process, and (iii) that such relation takes place within the framework of a decently well-functioning rule of law system. Using as a paradigmatic example the BTC pipeline case– a set of contracts and international treaties signed by a consortium of private companies and several sovereign states during the first decade of the 21st century to regulate the building and operation of a transnational oil pipeline – I analyze one by one these three assumptions to conclude that they are at the very least highly problematic in the context of global legal practice. Additionally, I consider the counter-argument that a lawyer who moves beyond the standard conception is actually usurping the role of the judge, an argument that loses much of its appeal on the transnational context. In a brief concluding remark I inscribe these problems within the more general post-Westphalian paradigm shift in law and jurisprudence.

Keywords

Legal EthicsJurisprudenceAmoralityTransnational Legal PracticeBTC pipeline case
Type
Research Article
Information
Canadian Journal of Law & Jurisprudence , Volume 32 , Issue 2 , August 2019 , pp. 259 - 283
Copyright
© Canadian Journal of Law & Jurisprudence 2019 

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Footnotes

I am grateful to my former students Berta Casanova Aguilera for legal and factual research on the BTC case, and Ferran Soler Gomà for proofreading of early drafts.

References

1. Michel de Montaigne, Selected Essays, edited by William Carew Hazlitt, translated by Charles Cotton (Dover, 2011) at 195.

2. I use this widest of criteria deliberately. The use of the adjective ‘transnational’ to qualify legal phenomena that happen “across borders” in any relevant sense is common in the literature since the term was firstly coined by Philip Jessup, Transnational Law (Yale University Press, 1956) at 2: “I shall use ... the term ‘transnational law’ to include all law which regulates actions or events that transcend national borders. Both public and private international law are included, as are other rules which do not wholly fit into such standard categories”. Transnational law is therefore wider than—and encompasses—international law in the classic sense of the term. Sometimes I will use the term ‘transnational’ and ‘global’ as interchangeable, although it is possible to trace differences among both (see, e.g., García, Frank, “Globalization’s Law: Transnational, Global or Both?” (2015) in Capaldo, Giuliana Ziccardi, ed, The Global Community Yearbook of International Law and Jurisprudence (Oxford University Press, 2015Google Scholar)).

3. Toby Carroll, “Pipelines, Participatory Development and the Reshaping of the Caucasus” (2009) Center on Asia and Globalization Working Paper Series, National University of Singapore, Working Paper No 007 at 13.

4. See Fred C Zacharias, “The Images of Lawyers” (2007) 20:1 Geo J Leg Ethics 73 at 73-74 (for an American view on the issue); Massimo La Torre, “‘Juristas, Malos Cristianos’ Abogacía y Etica Jurídica” (2003) 12 Derechos y Libertades 71 at 81-82 (for a European perspective on the same problem).

5. See W Bradley Wendel, “The Limits of Positivist Legal Ethics: A Brief History, a Critique, and a Return to Foundations” (2017) 30:2 Can JL & Jur 443 at 445 [Wendel, “The Limits”].

6. Among many others, O’Dair, Richard, Legal Ethics: Text and Materials (Cambridge University Press, 2001Google Scholar) at 134.

7. The second part of the sentence can be considered a third principle in its own right: the principle of non-accountability (Wendel, W Bradley, Lawyers and Fidelity to Law (Princeton University Press, 2010CrossRefGoogle Scholar) at 29 [Wendel, Fidelity]).

8. Richard Wasserstrom, “Lawyers as Professionals: Some Moral Issues” (1975) 5:1 Human Rights 1 at 8.

9. Nicholson, Donald & Webb, Julian, Professional Legal Ethics (Oxford University Press, 2000) at 180Google Scholar.

10. Massimo La Torre, “Abogacía y retórica. Entre teoría del derecho y deontología forense” (2009) 25 Anuario de Filosofía del Derecho 13 at 16. Difficulties in understanding this subtlety, or maybe the hypocritical use that lawyers have often made of it, may explain why they have been so frequently described as despicable in Western literature, philosophy, and popular culture. There are hundreds of examples frequently referred to in the legal ethics literature, ranging from Plato to Luther to modern films and TV series.

11. Simon, William H, The Practice of Justice: A Theory of Lawyers’ Ethics (Harvard University Press, 1998) at 100CrossRefGoogle Scholar.

12. Wendel, Fidelity, supra note 7 at 30.

13. Wendel, Fidelity, supra note 7 at 20. The very idea that there can exist a role-differentiated morality is questioned from some philosophical quarters, especially from those working under Kantian premises. Thus, for example, Massimo La Torre draws on the principle of universalizability to conclude that there cannot be such a thing as a role-differentiated morality, since we cannot rationally expect the specific duties attached to a particular occupation to be universally extended to other roles (see La Torre, supra note 4 at 99; but see Luban, David, Lawyers and Justice: An Ethical Study (Princeton University Press, 1988) at 113-15Google Scholar). If that is the case, professional ethics “must either be derived from, be identical with, or be an intensification of ordinary morality” (Koehn, Daryl, The Ground of Professional Ethics (Routledge, 1994) at 4Google Scholar, reflecting, although not sharing, some of these criticisms). This view would reject the common intuition among legal ethicists that both the philosophical and the practical interest of legal ethics lies precisely in the conflict between ordinary morality and professional duties (see Kimberly Kirkland, “Confessions of a Whistleblower: A Law Professor’s Reflections on the Experience of Reporting a Colleague” (2007) 20:4 Geo J Leg Ethics 1105). I will not discuss this philosophical point any further, since the object of this paper is not to examine the plausibility of the theory of amorality as such. Its dominance within both the academia and the professional ranks can be ascertained as an empirical fact.

14. O’Dair, supra note 6 at 134.

15. Luban, supra note 13 at 129-33.

16. See Kenneth Kipnis, “Ethics and the Professional Responsibility of Lawyers” (1991) 10:8 J Business Ethics 569.

17. See Stephen Pepper, “The Lawyer’s Amoral Ethical Role: A Defense, A Problem, and Some Possibilities” (1986) 1986:4 American Bar Foundation Research J 613.

18. Wendel, “The Limits”, supra note 5 at 448.

19. Wendel, Fidelity, supra note 7 passim.

20. Wendel, Fidelity, supra note 7 at 82.

21. Andrew M Perlman, “A Behavioral Theory of Legal Ethics” (2015) 90:4 Ind LJ 1639 at 1663.

22. Wendel, Fidelity, supra note 7 at 187: “in legal ethics discourse, the criminal defense paradigm always hovers in the background, subtly informing our tacit assumptions about what a lawyer’s duties ought to be.”

23. Moreover, the theory of amorality draws on complicated assumptions of social psychology (see, e.g., Perlman, supra note 21, questioning from a psychological perspective the capacity of a lawyer of making objective judgements while playing a partisan role). I am not dealing here with this interesting issue and other similar criticisms.

24. Holmes, Vivien & Rice, Simon, “Our common future: the imperative for contextual ethics in a connected world” in Bartlett, Francesca, Mortensen, Reid & Tranter, Kieran, eds, Alternative Perspectives on Lawyers and Legal Ethics. Reimagining the Profession (Routledge, 2011) 56Google Scholar at 59.

25. The BTC consortium was incorporated with the official name of Baku-Tbilisi-Ceyhan Pipeline Company in 2002. The main shareholder was British Petroleum, with more than 30% of the total amount of shares, but there were ten other shareowners—from more to less owned shares: the Azari SOCAR, the American UNOCAL, the Norwegian STATOIL, the Turkish TPAO, the Italian ENI, the French TOTAL, the Japanese ITOCHU, the Japanese INPEX, the American CONOCOPHILIPS, and the British HESS Energy Trading Company. There were other important transnational corporations involved through the process, especially in the construction phase. For the sake of simplicity, I am leaving those aside, and concentrating solely on the BTC consortium and its relations with the states.

26. Technical information on the pipeline can be found at: “Operations and Projects: Pipelines: Baku-Tbilisi-Ceyhan Pipeline”, BP Azerbaijan, online: www.bp.com/en_az/caspian/operationsprojects/pipelines/BTC.html.

27. After initial negotiations that go as far back as 1992, the intergovernmental agreement between Azerbaijan, Georgia, and Turkey was finally signed by the Presidents of the countries (respectively Heydar Aliyev, Edward Shevardnadze and Süleyman Demirel) in 1999 during a meeting of the Organisation for the Security and Cooperation in Europe celebrated in Istambul, and with the signature of the President of the United States Bill Clinton as witness. The Host Government Agreements were signed on April 28, 2000 (Georgia), October 17, 2000 (Azerbaijan), and October 19, 2000 (Turkey). A fifth important pillar of the legal structure was an agreement entered with the state-owned Turkish company BOTAS concerning the construction and operation of the Turkish end of the pipeline. For the same reasons of simplicity already expressed, I am going to leave this particular contract and other legal documents aside.

28. The law firm in charge was the Houston based Baker & Botts, representing the main investor (British Petroleum) and also the Azari’s state-owned oil company. A very informative—and fiercely critical—account of Baker & Botts’ involvement in the BTC project, touching upon legal, commercial and political issues, can be found at Daphne Eviatar, “Wildcat Lawyering” (2 November 2002), Law.com, online: www.law.com/almID/900005532993/Wildcat-Lawyering/. There were other lawyers involved, both public lawyers representing the states and private firms.

29. See Douglas-Scott, Sionaidh, Law After Modernity (Hart, 2013Google Scholar) at ch 5.

30. See Westerman, Pauline, Outsourcing the Law (Edward Elgar, 2018CrossRefGoogle Scholar).

31. The language “prevailing legal regime” was explicitly used in the intergovernmental treaty (Art.II, 4 (i)). For the remainder of this piece, and for the purpose of not overloading the text with footnotes, I am not going to make specific citations to the sections and articles of the agreements. The full text of the agreements (including the three host-government agreements and the intergovernmental agreement) can be found at “BP in Azerbaijan: Legal Agreements”, BP Azerbaijan, online: www.bp.com/en_az/caspian/aboutus/legalagreements.html.

32. See Abigail S Reyes, “Protecting the Freedom of Transit of Petroleum: Transnational Lawyers Making (up) International Law in the Caspian” (2006) 24:3 BJIL 842, for an exhaustive analysis of the text of the agreements and the problems involved in those areas.

33. Ibid at 879.

34. Furthermore, undertaking an empirical study on the particulars of the BTC operation would have had methodological problems of its own. Although receiving severe ethical criticism from some quarters (ibid at 884), the BTC is not widely identified in the public opinion as a corporate scandal and it has not generated even a fraction of the massive body of literature produced in relation to other contemporary corporate cases. Things are subtler here, what adds an extra layer of interest to the case, but also implies that information is scarce and consequently research becomes more difficult. Since the case has not been seriously challenged at either the legal or the political levels, there are no legal proceedings or independent inquiries offering objective and easily accessible information.

35. The term ‘agent’ is used here with two different meanings. Firstly, I refer to the lawyer as an agent of the client, authorized to act legally in her place. This is the usual meaning of the term within the context of the agency relation, in all its possible manifestations. But I also speak of both lawyer and client as agents in a second meaning, as autonomous beings that have the power to act freely and to produce effects in the world through their actions. This is the usual meaning of the term in the context of moral philosophy.

36. Wilkins, David B, “Where the Action is: Globalisation, Law and Development, the Sociology of the Legal Profession, and the ‘GLEE-full’ Career of Dave Trubek” in de Búrca, Gráinne, Kilpatrick, Claire & Scott, Joanne, eds, Critical Legal Perspectives on Global Governance (Hart, 2005) 439 at 445Google Scholar.

37. HW Arthurs, “A Global Code of Legal Ethics for the Transnational Legal Field” (1999) 1:3 Legal Ethics 59 at 66.

38. Wilkins, supra note 36 at 445.

39. See John Flood, “Megalawyering in the Global Order: The Cultural, Social and Economic Transformation of Global Legal Practice” (1996) 3 Int’l J of the Legal Profession 169.

40. The usual reference to “the lawyer” ignores the rather obvious fact that humans behave differently when we are in group than when we act alone. This is well documented in social psychology and has led to both theoretical and practical developments considering the implications of the law firm context for legal ethics (Perlman, supra note 21 at 1665).

41. Flood, John, What Do Lawyers Do? An Ethnography of a Corporate Law Firm (Quid Pro Books, 2013) at 17Google Scholar.

42. Mikhail Xifaras, “The Global Turn in Legal Theory” (2016) 29:1 Can JL & Jur 215 at 219.

43. Arthurs, supra note 37 at 68.

44. John KM Ohnesorge, “Corporate Lawyers as an Infant Industry? Legal Market Access and Development Policy” in Critical Legal Perspectives on Global Governance, supra note 36 at 426.

45. There seems to be empirical evidence supporting such concern, as reported in Wendel, Fidelity, supra note 7 at 64.

46. Arthurs, supra note 37 at 66.

47. Ibid.

48. Mark A Sargent, “Lawyers in the Moral Maze” (2004) 49:4 Vill L Rev 867 at 883.

49. A further problem, of huge philosophical significance, is that corporations—in spite of being treated as persons for legal purposes—are mere legal fictions “and not autonomous moral actors capable of free will or autonomous responsible citizenship”, and therefore lack the moral agency to “justify an attorney’s suspension of moral judgment” (Judith McMorrow & Luke M Scheuer, “The Moral Responsibility of the Corporate Lawyer” (2011) 60:2 Cath U L Rev 275 at 278). Fundamental as it is, I leave this point aside from the analysis, since it does not exclusively affect transnational practice but corporate lawyers in all different contexts, including the domestic arena.

50. Holmes & Rice, supra note 24 at 74.

51. Indeed, Azerbaijan was formally represented by Baker & Botts through its state-owned oil company. The fact that there were three countries involved made things particularly difficult, especially since the differences among them in terms of legal background and (legal and non-legal) culture, and economic and political interests (both geo-strategically and in relation to the pipeline project), were innumerable. This is why, besides treasuring extraordinary legal skills, the lawyers responsible for the agreements had to have “a secretary of state’s political savvy” (see Eviatar, supra note 28).

52. Wendel, Fidelity, supra note 7 passim.

53. Wendel defines a legal entitlement—in a very Hohfeldian way—as “a substantive or procedural right, created by the law, which establishes claim-rights (implying duties upon others), privileges to do things without interference, and powers to change the legal situation of others (e.g., by imposing contractual obligations)” (ibid at 50).

54. Wendel, Fidelity, supra note 7 at 59, adding: “This is such an obvious point that it is hard to understand why lawyers sometimes fail to appreciate it. But it may be the most pervasive feature of the normative framework of practicing lawyers that they proclaim an obligation to defend their clients’ interests within the law, rather than vindicating their clients’ legal entitlements”.

55. Ibid, passim.

56. Ibid at 210.

57. Holmes & Rice, supra note 24 at 74. The authors put forward the idea that in the absence of a clear domestic system of reference, lawyers should take directly into account the broader context of their actions. Thus, moving legal ethics into paths more often trodden by business ethicists, they suggest that business lawyers must consider how their decisions affect their client’s stakeholders. The starting point of such approach shares the main thesis of this paper, namely, that the key to legal ethics lies in context, and in the absence of a clear domestic rule of law system, another relevant framework must be found for amorality to be a justifiable model. However, the stakeholder approach raises practical issues that, in the sort of complex cases that transnational lawyers frequently confront, become virtually intractable, if only because the actions of these lawyers may affect “a plethora of publics with differing and often opposing interests” (Arthurs, supra note 37 at 66). The BTC case is again a perfect example, with its relevant stakeholders including at the very least the governing elites of the states, its populations, the communities directly affected by the pipeline, national and foreign workers, other companies that benefited from the project or were negatively affected by it, national and foreign competitors, neighbouring countries, and the environment—not to mention the ultimate consumers of oil and gas, other pipeline communities around the world, the international community or even future generations.

58. Nicholson & Webb, supra note 9 at 166.

59. Holmes & Rice, supra note 24 at 60.

60. Luban, supra note 13 at 146.

61. Ibid at 151-52.

62. W Bradley Wendel, “Professionalism as Interpretation” (2005) 99:3 Nw UL Rev 1167 at 1182.

63. Ibid.

64. Wendel, Fidelity, supra note 7 at 54.

65. Murray L Schwartz, “The Professionalism and Accountability of Lawyers” (1978) 66:4 Cal L Rev 669 at 677.

66. Among many others see Roger C Cramton, “Enron and the Corporate Lawyer: A Primer on Legal and Ethical Issues” (2002) 58:1 Bus Lawyer 143.

67. Holmes & Rice, supra note 24 at 56.

68. Abigail Reyes suggests that this “innovation in private international law” is a direct response to the growing litigation around human right abuses committed along pipeline corridors (supra note 32 at 850). The first of these actions in the US, Doe vs Unocal, was filed in 1996, just three years before the first of the BTC agreements was signed. The “indemnification clause” is not literally to be found in the agreements but according to Reyes is a plausible interpretation of the actual clauses (ibid at 870).

69. See Pepper, supra note 17.

70. Not only exotic, but also controversial as regards their efficacy and even desirability (see, e.g., Arthurs, supra note 46 or Andrew Boon & John Flood, “Globalization of Professional Ethics? The Significance of Lawyers’ International Codes of Conduct” (1999) 2:1 Legal Ethics 29).

71. Wendel, Fidelity, supra note 7 at 49. Therefore, “the normative attractiveness of the lawyer’s role depends on the normative attractiveness of legality” (ibid at 92).

72. Holmes & Rice, supra note 24 at 70.

73. Ibid at 62.

74. Xifaras, supra note 42 at 220.

75. Wendel, “The Limits”, supra note 5 at 445.

76. In the words of the Baker & Botts head of the BTC project: “without having to amend local laws, we went above and around them by using a treaty” (cited in Reyes, supra note 32 at 856).

77. In this sense, “[t]he morally activist lawyer shares and aims to share with her client responsibility for the ends she is promoting in her representation” (Luban, supra note 13 at xxii). As a consequence, neither the principle of neutrality nor the principle of non-accountability apply to her.

78. In the words of Vivien Holmes and Simon Rice: “A lawyer cannot justify acting on a client’s instructions simply because those instructions are ‘legal’, or even ‘not illegal’, in circumstances where institutions of the state cannot be relied on to mediate between the diverse range of views of what ought to be done” (supra note 24 at 70).

79. Wendel, “The Limits”, supra note 5 at 462.

80. Ibid.

81. Xifaras, supra note 42 at 221. The previous quote from Benoît Frydman, ibid at 221, n 12.

82. Christopher J Whelan, “Ethics Beyond the Horizon: Why Regulate the Global Practice of Law?” (2001) 34:4 Vand J Transnat’l L 931 at 946.

83. The words are from the 19th century Judge George Sharswood, as quoted in Luban, supra note 13 at 10.

84. Frank J Garcia, “The Moral Hazard Problem in Global Economic Regulation” (Boston College Law School Faculty Papers, presented at the IALS Conference on The Law of International Business Transactions: A Global Perspective, delivered at the Bucerius Law School, Hamburg, Germany, 10-12 April 2008).

85. Douglas-Scott, supra note 29 at 147.

86. This is the most persuasive response against the counter-argument that in a case such as the BTC it is ultimately the signature by the sovereign states that gives authority to the agreements as binding law, thus liberating the private lawyers from moral responsibility. True as this may be from a purely formal perspective, it hides and distorts the substantial economic and political dimensions of the case. It is of course an option to turn a blind eye on those, but such option is not ethically neutral—it carries a moral weight.

87. Holmes & Rice, supra note 24 at 73.

88. David Kennedy, “Law and the Political Economy of the World” in Critical Legal Perspectives on Global Governance, supra note 36 at 66.

89. See, e.g., Garcia, Frank J, Global Justice and International Economic Law: Three Takes (Cambridge University Press, 2013CrossRefGoogle Scholar), heavily drawing on the ideas on (global) justice advanced by contemporary political thinkers such as John Rawls and Amartya Sen.

90. Garcia, Frank J, Consent and Trade: Trading Freely in a Global Market (Cambridge University Press, 2018) at 211CrossRefGoogle Scholar.

91. Garcia, supra note 90 at 4.

92. Kennedy, supra note 88 at 72.

93. Garcia, supra note 90 at 3.

94. Koehn, supra note 13 at 174.

95. Nicholson & Webb, supra note 9 at 224.

96. Wasserstrom, supra note 8 at 8.