DUTY OF LOYALTY _conflicts of interest_

Document Sample
DUTY OF LOYALTY _conflicts of interest_ Powered By Docstoc
					Professional Responsibility
         Law 115

      Wed., Nov. 28
  DUTY OF LOYALTY
(conflicts of interest)




                          2
• Personal Interest Conflicts 1.8
  – All imputed to other members of firm (except
    1.8(j) – sexual relations)
     • See 1.8(k)
     • While lawyers are associated in a firm, a prohibition in
       the foregoing paragraphs (a) through (i) that applies to
       any one of them shall apply to all of them.




                                                                  3
• Maintenance
• Champerty




                4
• 1.8(e) A lawyer shall not provide financial
  assistance to a client in connection with
  pending or contemplated litigation, except
  that:
• (1) a lawyer may advance court costs and
  expenses of litigation, the repayment of which
  may be contingent on the outcome of the
  matter; and
• (2) a lawyer representing an indigent client
  may pay court costs and expenses of litigation
  on behalf of the client.

                                               5
• 1.8(i) A lawyer shall not acquire a proprietary
  interest in the cause of action or subject
  matter of litigation the lawyer is conducting
  for a client, except that the lawyer may:
• (1) acquire a lien authorized by law to secure
  the lawyer's fee or expenses; and
• (2) contract with a client for a reasonable
  contingent fee in a civil case.




                                                    6
• Personal interests affecting representation
  – Need not be mentioned in 1.8




                                                7
• The disqualification arising from a close family
  relationship is personal and ordinarily is not
  imputed to members of firms with whom the
  lawyers are associated. See Rule 1.10.




                                                     8
• Having sex with clients




                            9
• 1.8(j)
• A lawyer shall not have sexual relations with a
  client unless a consensual sexual relationship
  existed between them when the client-lawyer
  relationship commenced.




                                                10
• Problem of jointly representing criminal
  defendants




                                             11
• Problems in representing joint clients in
  transactional work




                                              12
State v. Callahan
  (Kan. 1982)
MR 1.2(c) (c) A lawyer may limit the
 scope of the representation if the
limitation is reasonable under the
circumstances and the client gives
         informed consent.
• But joint representation can be in clients’
  interest
• Despite disadvantages
  – Especially if there is a falling out
  – No attorney client privilege with respect to one
    another
  – problems of duty of confidentiality
  – And generally cannot represent one in a
    substantially related issue unless the other
    consents



                                                       15
• Successive Representation




                              16
• 1.9(c) A lawyer who has formerly represented a
  client in a matter or whose present or former firm
  has formerly represented a client in a matter shall
  not thereafter:
• (1) use information relating to the representation to
  the disadvantage of the former client except as these
  Rules would permit or require with respect to a
  client, or when the information has become
  generally known; or
• (2) reveal information relating to the representation
  except as these Rules would permit or require with
  respect to a client.


                                                      17
• Rule 1.9 Duties To Former Clients
• (a) A lawyer who has formerly represented a
  client in a matter shall not thereafter
  represent another person in the same or a
  substantially related matter in which that
  person's interests are materially adverse to
  the interests of the former client unless the
  former client gives informed consent,
  confirmed in writing.



                                                  18
• Comment 3 to 1.9
• substantially related = same transaction or
  legal dispute or if there otherwise is a
  substantial risk that confidential factual
  information as would normally have been
  obtained in the prior representation would
  materially advance the client's position in the
  subsequent matter




                                                    19
  what happens when you jointly
  represented A and B in the past
and now want to represent B only
in a substantially related matter in
 which B’s interests are materially
          adverse to A’s?
Brennan’s Inc v Brennan’s
    Restaurants Inc
     (5th Cir. 1979)
what if lawyer represents
organization and constituent and
then there is a falling out

may lawyer continue representing
organization in a substantially
related manner when organization’s
interests are materially adverse to
constituents?
accommodation client
• You were corporate counsel for the A Corp.
  from 1996-98. Since then a new board of
  directors has gained control. B approaches
  you and asks you to represent him in a suit
  against members of the board concerning
  actions they undertook after you left. Any
  conflicts problems?




                                                24
• You have defended the A Corp. in employment
  discrimination suits brought against it from
  1978-98. This year B approaches you and asks
  you to bring an employment discrimination
  suit against the A Corp. concerning actions by
  the corporation that occurred after you
  terminated your relationship with it. Any
  conflicts problems?




                                               25
• You unsuccessfully defend A in criminal
  charges. Afterward the prosecutor in the case
  approaches you and asks you to bringing a
  high profile product liability action on his
  behalf against the D Corp. Any conflicts
  problems?




                                              26
Prosecutor approaches you and asks
you to bringing a high profile product
liability action on his behalf against the
D Corp. The suit was successfully
concluded. Then A asks you to defend
him in criminal changes brought by
Prosecutor. Any conflicts problems?
- A and B are bitter rivals
- Lawyer represented A in a breach
of contract suit against C
- B asks Lawyer to represent it in a
tort suit against it filed by D
- any conflicts problems?
- A and B are bitter rivals
- Lawyer defended A in a antitrust
suit brought by C
- B asks Lawyer to represent it in a
antitrust suit against A
- any conflicts problems?
Lawyer represented Maritrans in
reducing labor costs without
violating labor laws

It dropped Maritrans and
undertook to represent Maritrans’s
rival in order to help it reduce labor
costs without violating labor laws

conflicts problems?
• Prospective clients




                        31
• Rule 1.18 Duties To Prospective Client
• (c) A lawyer subject to paragraph (b) shall not
  represent a client with interests materially
  adverse to those of a prospective client in the
  same or a substantially related matter if the
  lawyer received information from the
  prospective client that could be significantly
  harmful to that person in the matter, except as
  provided in paragraph (d).



                                                32
• L represents A is the simple drafting of a will
• L is approached by B to discuss L representing
  B in drafting B’s will (no actual representation)
• assume A and B give same amount of info to L
• assume that A’s and B’s wives want to sue A
  and B for child support and have L as their
  lawyer
• does B have a greater burden in disqualifying L
  than A?


                                                  33
• A – must show only that the matters are
  substantially similar and interests are
  materially adverse
• B – must also show that lawyer received
  information from B that could be significantly
  harmful to B in the matter




                                                   34
• A former client is not required to reveal the
  confidential information learned by the lawyer
  in order to establish a substantial risk that the
  lawyer has confidential information to use in
  the subsequent matter. A conclusion about
  the possession of such information may be
  based on the nature of the services the lawyer
  provided the former client and information
  that would in ordinary practice be learned by
  a lawyer providing such services.


                                                  35
• Comment [6] to 1.18
• Even in the absence of an agreement, under
  paragraph (c), the lawyer is not prohibited
  from representing a client with interests
  adverse to those of the prospective client in
  the same or a substantially related matter
  unless the lawyer has received from the
  prospective client information that could be
  significantly harmful if used in the matter.



                                                  36
• Conflict tainting




                      37
• Comment 2 to 1.18
• A person who communicates information
  unilaterally to a lawyer, without any
  reasonable expectation that the lawyer is
  willing to discuss the possibility of forming a
  client-lawyer relationship, is not a
  "prospective client" within the meaning of
  paragraph (a).




                                                    38
imputation concerning prospective
         client conflicts
• If a lawyer is disqualified from representation
  under this paragraph, no lawyer in a firm with
  which that lawyer is associated may knowingly
  undertake or continue representation in such
  a matter, except as provided in paragraph (d).




                                                40
• 1.18(d) When the lawyer has received
  disqualifying information as defined in
  paragraph (c), representation is permissible if:
• (1) both the affected client and the
  prospective client have given informed
  consent, confirmed in writing, or




                                                 41
• (2) the lawyer who received the information
  took reasonable measures to avoid exposure
  to more disqualifying information than was
  reasonably necessary to determine whether
  to represent the prospective client; and
• (i) the disqualified lawyer is timely screened
  from any participation in the matter and is
  apportioned no part of the fee therefrom; and
• (ii) written notice is promptly given to the
  prospective client.


                                               42
• Imputed conflicts
• Transitory lawyers




                       43
• 1.10(a)
• While lawyers are associated in a firm, none of
  them shall knowingly represent a client when
  any one of them practicing alone would be
  prohibited from doing so by Rules 1.7 or 1.9,
  unless
• (1) the prohibition is based on a personal
  interest of the prohibited lawyer and does not
  present a significant risk of materially limiting
  the representation of the client by the
  remaining lawyers in the firm

                                                  44
• If one lawyer in a firm is prohibited from
  representing a client (w/o consent) under
  conflicts rules 1.7 or 1.9 (not personal
  interest conflicts), all lawyers in the firm
  are.




                                             45
1.8(k) While lawyers are associated
in a firm, a prohibition in the
foregoing paragraphs (a) through (i)
that applies to any one of them
shall apply to all of them.
screening does not help, except…
(2) the prohibition is based upon
Rule 1.9(a) or (b) and arises out of
the disqualified lawyer’s
association with a prior firm, and
(i) the disqualified lawyer is timely
screened from any participation in
the matter and is apportioned no
part of the fee therefrom;
(ii) written notice is promptly given to any
affected former client to enable the former client
to ascertain compliance with the provisions of
this Rule, which shall include a description of the
screening procedures employed; a statement of
the firm's and of the screened lawyer's
compliance with these Rules; a statement that
review may be available before a tribunal; and
an agreement by the firm to respond promptly
to any written inquiries or objections by the
former client about the screening procedures;
and
(iii) certifications of compliance with
these Rules and with the screening
procedures are provided to the former
client by the screened lawyer and by a
partner of the firm, at reasonable
intervals upon the former client's
written request and upon termination
of the screening procedures.
• c) A disqualification prescribed by this rule
  may be waived by the affected client under
  the conditions stated in Rule 1.7.




                                                  51
• 1.10(b) When a lawyer has terminated an association
  with a firm, the firm is not prohibited from thereafter
  representing a person with interests materially
  adverse to those of a client represented by the
  formerly associated lawyer and not currently
  represented by the firm, unless:
• (1) the matter is the same or substantially related to
  that in which the formerly associated lawyer
  represented the client; and
• (2) any lawyer remaining in the firm has information
  protected by Rules 1.6 and 1.9(c) that is material to
  the matter.


                                                       52
• If a tainting lawyer leaves the firm, the
  remaining lawyers are free of limitations
  except
• They still not may not represent (w/o consent)
  someone with interests materially adverse to
  a client of the tainting lawyer
• If the matter is the same or substantially
  similar to the earlier representation and
• The remaining lawyers have confidential
  information material to the matter

                                               53
• 1.9(b) A lawyer shall not knowingly represent a person in
  the same or a substantially related matter in which a
  firm with which the lawyer formerly was associated had
  previously represented a client
• (1) whose interests are materially adverse to that
  person; and
• (2) about whom the lawyer had acquired information
  protected by Rules 1.6 and 1.9(c) that is material to the
  matter;
• unless the former client gives informed consent,
  confirmed in writing.


                                                        54
• If a lawyer who was tainted leaves the firm
  with the tainting lawyer, he is free of
  limitation except
• she still may not represent (w/o consent)
  someone with interests materially adverse to
  the tainting lawyer’s client
• If she has confidences material to the matter




                                                  55
  • Assume X, a lawyer at Firm 1, defends A in
    connection with an antitrust claim against A
    brought by B. Y, also a lawyer at Firm 1, is
    approached by C, who wants to sue A for
    employment discrimination. Is there a
    conflicts problem?
 employment
 discrimination C
     A
     A                  Firm 1

antitrust           X            Y


     B


                                                   56
• What if “Firm 1" was not a partnership, but
  was merely a collection of lawyers that shared
  the same offices?




                                               57
 • Assume X, no longer represents A. Now may Y
   represent C?



 employment
 discrimination
                  C
     A
     A                    Firm 1

                      X            Y
antitrust


    B


                                             58
• May Y represent D, who is suing A for antitrust
  violations?




    antitrust D
  A
  A                   Firm 1

                  X            Y
antitrust


  B


                                                59
• May Z, who entered Firm 1 after X dropped A
  as a client, represent D?




    antitrust D
   A
   A                  Firm 1
                               Z (brand new lawyer)
antitrust         X


  B


                                                      60
• Assume that after dropping A as a client, X
  moves to Firm 2. May X now represent D in
  his suit against A?

                               Firm 2
                                        X

    antitrust D
   A
   A                  Firm 1

antitrust         X


  B


                                                61
• May W, another lawyer at Firm 2, represent D
  in his suit against A?


                               W
                                   Firm 2
                                            X

    antitrust D
   A
   A                  Firm 1

antitrust         X


  B


                                                 62
• After X leaves for Firm 2, may Y, who is still a
  lawyer at Firm 1 and who did a small amount
  of discovery work for A in B’s suit against A,
  represent D?

                                              Firm 2
                                                       X

    antitrust D           Y (small amt. of discovery
   A                      work for A)
   A                  Firm 1

antitrust         X


  B


                                                           63
• May V, who is still a lawyer at Firm 1 and who
  knew nothing about B’s suit against A,
  represent D?


                                              Firm 2
                                                       X

    antitrust D           Y (small amt. of discovery
   A                      work for A)
   A                  Firm 1
                      V
antitrust         X


  B


                                                           64
• Assume Y moves to Firm 3. May he now
  undertake to represent D?


                                      Y

                                              Firm 3


    antitrust D           Y (small amt. of discovery
   A                      work for A)
   A                  Firm 1

antitrust         X


  B


                                                       65
• May U, another lawyer at Firm 3, represent D?



                                      Y
                               U              Firm 3


    antitrust D           Y (small amt. of discovery
   A                      work for A)
   A                  Firm 1

antitrust         X


  B


                                                       66
• Assume instead that V moves to Firm 3. May
  V represent D?


                                      V

                                              Firm 3


    antitrust D           Y (small amt. of discovery
   A                      work for A)
   A                  Firm 1

                                          V
antitrust         X


  B


                                                       67
Firm 1 and Firm 2 cooperate jointly
in the defense of A in an antitrust
case. At the same time Firm 1's is
representing B in his suit against C,
who is represented by Firm 2. Is
there a conflicts problem?
Duty of Competence
• Malpractice
• also disciplinary law
• Rule 1.1 Competence
• A lawyer shall provide competent
  representation to a client. Competent
  representation requires the legal knowledge,
  skill, thoroughness and preparation
  reasonably necessary for the representation.
• Comment [2] A lawyer need not necessarily
  have special training or prior experience to
  handle legal problems of a type with which
  the lawyer is unfamiliar. …A lawyer can
  provide adequate representation in a wholly
  novel field through necessary study.
• Comment [3] In an emergency a lawyer may
  give advice or assistance in a matter in which
  the lawyer does not have the skill ordinarily
  required where referral to or consultation or
  association with another lawyer would be
  impractical. Even in an emergency, however,
  assistance should be limited to that
  reasonably necessary in the circumstances,
  for ill-considered action under emergency
  conditions can jeopardize the client's interest.
• Rule 1.3 Diligence
• A lawyer shall act with reasonable diligence
  and promptness in representing a client.
Malpractice
• duty of care
• breach
  – failure to exercise are that a reasonably
    competent attorney would under the
    circumstances
• causation
• harm
Lucas v. Hamm (Cal. 1961)
Smith v. Lewis
 (Cal. 1975)
Problems with causation
• Lawyer botches case by failing to call witness
  in a medical malpractice case
• She is sued for malpractice
• Even if she was breached her duty of care,
  how can escape liability
Lawyer undertakes to represent P
in P’s slip and fall suit against D
Lawyer already represents D in a
breach of contract suit against X
P was not informed of Lawyer’s
representation of D.
Malpractice action?
• Lawyer breaches her duty of care to her client
  by failing to communicate a settlement offer
  to the other side.
• Later they settle on terms unsatisfactory to
  client.
• How does one determine the damages caused
  by Lawyer’s breach?
  Malpractice in criminal defense
• Public defenders usually immune
• But even if lawyer was not public defender,
  plaintiff can successfully sue only if post-
  conviction relief was granted
• Sometime actual innocence must be shown
liability to third parties
Greycas v. Proud
 (7th Cir. 1987)
• Attorney asked to draft opinion letter concerning
  whether liens on some property owned by the client
• Attorney knows that the letter is to be given to X, who
  intends to loan money to client, provided that debt can
  be secured by property
• Attorney negligently drafts the letter, stating that the
  property has no liens on it, when in fact it does
• X decides for other reasons that it cannot make the
  loan, but tells another company, Y, that it should make
  the loan to X because it may be secured by the
  property
• Y makes the loan to the client. The client defaults and
  Y sues the attorney for negligent misrepresentation.
  What result?
      Limiting malpractice liability
1.8(h) A lawyer shall not:
• (1) make an agreement prospectively limiting the
  lawyer's liability to a client for malpractice unless the
  client is independently represented in making the
  agreement; or
• (2) settle a claim or potential claim for such liability
  with an unrepresented client or former client unless
  that person is advised in writing of the desirability of
  seeking and is given a reasonable opportunity to seek
  the advice of independent legal counsel in connection
  therewith.

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:5
posted:12/28/2012
language:Latin
pages:86