TOP TEN ETHICAL TRAPS AND HOW TO AVOID THEM T F

TOP TEN ETHICAL TRAPS AND HOW TO AVOID THEM
STEVEN H. SCHWEITZER
THE FULLENWEIDER FIRM
4265 San Felipe, Suite 1400
Houston, Texas 77027
28th Annual Advanced Family Law Course
August 5 - 8, 2002 - Dallas, Texas
Chapter 56
STEVEN H. SCHWEITZER
THE F ULLENWEIDER F IRM
4265 SAN F ELIPE, SUITE 1400
H OUSTON, T EXAS 77027
EDUCATION:
University of Houston Law Center
Juris Doctor - 1977
Texas Tech University
Bachelor of Business Administration - 1975
BAR ADMISSIONS :
Texas Supreme Court - May 1978
U.S. Court of Appeals, Fifth Circuit
BOARD CERTIFICATION:
Family Law, Texas Board of Legal Specialization - 1987
Re-certified - 1992, 1997
EXPERIENCE AND TRAINING:
Law Offices of Charles J. Brink & Associates - 1979-1980
Law Offices of Steven H. Schweitzer - 1980-1983
Associate Judge, 308th District Court - 1983-March 1994
Advanced Mediation Training; A.A. White Dispute Resolution Institute;
Divorce & Child Custody, 1993
The Fullenweider Firm - July 1994-present
PROFESSIONAL –HONOR AFFILIATIONS :
Director:
Faculty:
Gulf Coast Family Law Specialists-1989, 1991
State Bar of Texas Annual Meeting - 1990
(Author/Panelist)
Faculty:
14th Annual Marriage Dissolution Institute - 1991
(Author/Panelist)
Faculty:
South Texas College of Law Family- Law Practice Seminar -1994, (Author/Panelist)
Faculty:
University of Houston Family Law Practice Seminar- 1994
& 1995
Faculty:
South Texas College of Law, Family Law for the General Practitioner and Legal Assistant,
1999 & 2000
Faculty:
State Bar of Texas-Marriage Dissolution Seminar 1999
Committee
American Bar Association Family Law Section 1993-1994– The Care and Concern of Children Custody
Judicial Liaison: Houston Bar Association
MEMBERSHIPS :
American Bar Association
State Bar of Texas, Family Law Section
State Bar of Texas, Litigation Section
College State Bar of Texas
Houston Bar Association, Family Law Section
Burta Rhoads Raborn American Inns of Court
Gulf Coast Family Law Specialists
Texas Academy of Family Law Specialists
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Table of Contents
I.
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Top Ten: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Preamble to the Texas Disciplinary Rules of Professional Conduct, Excerpted . . . . . . . . . . . . . . . . . . 1
II. LAWYER-CLIENT RELATIONSHIP . . . . . . . . . . . . . . . . . . . . . . . . .
A. Who is the Client? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
B. How is the Attorney-Client Relationship Formed? . . . . . . . . . . . . . . . . . .
C. Who is the client when a third party hires the lawyer and/or pays the bills?
D. “I am not your lawyer” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
E. Preventative Measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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III. CONFLICTS OF INTEREST . . . . . . . . . . . . . . . . . . . . . . .
A. Current Clients--Rule 1.06. Conflict of Interest: General Rule .
B. Former Clients--Rule 1.09. Conflict of Interest: Former Client
C. Imputed Conflicts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1.
LAWYERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. NON-LAWYERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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IV. TERMINATING REPRESENTATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
A. Rule 1.15. Declining or Terminating Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
C. Maintaining Privilege following Disqualification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
V.
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
i
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Table of Authorities
Arzate v. Hayes, 915 S.W.2d 616 (Tex. App.—El Paso 1996, writ dism’d) . . . . . . . . . . . . . . . . . . . . . . 14
Belt v. Commission for Lawyer Discipline, 970 S.W.2d 571 (Tex. App.—Dallas 1997, no writ) . . . . . . . . 18
Brasher v. State, 715 S.W.2d 827 (Tex. App. Houston [14th dist.] 1986, no writ) . . . . . . . . . . . . . . . . . 17
Byrd v. Woodruff, 891 S.W.2d 689, 700-701 (Tex. App.—Dallas 1994, writ denied) . . . . . . . . . . . . . . . . 4
City of El Paso v. Salas-Porras Soule, 6. F. Supp. 2d 616, 625 (W.D. Tex. 1998) . . . . . . . . . . . . . . . . . . 9
Clarke v. Ruffino, 819 S.W.2d 947, 949 (Tex. App.—Houston [14th Dist.] 1991, writ dism’d w.o.j.) . . . . 4
Clarke v. Ruffino, 819 S.W.2d 947, 950 (Tex. App.—Houston [14th Dist.] 1991, writ dism’d w.o.j.) . . . . 9
Davis v. Stansbury, 824 S.W.2d, 278 (Houston [1st. Dist] 1992, no writ) . . . . . . . . . . . . . . . . . . . . . . . 11
Ditto v. State, 898 S.W. 2d 383 (Tex. App. – San Antonio 1995) rev’d on other grounds 988 S.W.2d 236
(Tex. Crim. App. 1999) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Gleason v. Compton, 693 S.W.2d 564 (Houston [14th Dist.], 1985, no writ) . . . . . . . . . . . . . . . . . . . . . 10
Grant v. Thirteenth Court of Appeals, 888 S.W.2d 466 (Tex. 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Gray v. Memorial Med. Center, Inc., 855 F.Supp. 377 (S.D. Ga. 1994) . . . . . . . . . . . . . . . . . . . . . . . . 12
Hebisen v. State, 615 S.W.2d 866, 868 (Tex. Civ. App. – Houston [1st Dist.] 1981, no writ) . . . . . . . . . . 17
HECI Exploration Co. v. Clajon Gas Co. 843 S.W.2d 622 (Tex. App.—Austin 1992, writ denied) . . . . . . . 7
Henderson v. Floyd, 891 S.W.2d 252 (Tex. 1995) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Hicks v. State, 864 S.W.2d 693 (Tex. App. Houston [14th dist.] 1993, no writ) . . . . . . . . . . . . . . . . . . . 17
Hicks v. State, 864 S.W.2d 693 (Tex. App. Houston [14th dist.] 1993, no writ) . . . . . . . . . . . . . . . . . . . 17
In re American Airlines, Inc., 972 F.2d 605, 614 (5th Cir. 1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
In re American Home Products Corp., 985 S.W.2d 68, 75 (Tex. 1998) . . . . . . . . . . . . . . . . . . . 13
In re Corrugated Container Antitrust Litig., 659 F.2d 1341, 1346 (5th Cir. 1981) . . . . . . . . . . . . . . . . . . 10
In re Epic Holdings, Inc., 985 S.W.2d 41 (Tex. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
In re George, 28 S.W.3d 511 (Tex. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
In re George, 28 S.W.3d 511, 516 (Tex. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Martin v. State, 896 S.W.2d 336, 340 (Tex. App.- Amarillo 1995, no writ) . . . . . . . . . . . . . . . . . . . . . . 17
Monroe v. City of Topeka, 988 P.2d 228, 234 (Kan. 1999) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Moss v. Malone, 880 S.W.2d 45 (Tex. App.—Tyler 1994, writ denied) . . . . . . . . . . . . . . . . . . . . . . . . . 18
NCNB Texas Nat. Bank v. Coker, 765 S.W.2d 398, 400 (Tex. 1989) . . . . . . . . . . . . . . . . . . . . . . . . . . 10
NCNB Texas Nat’l Bank v. Coker, 765 S.W.2d 398, 399-400 (Tex. 1989) . . . . . . . . . . . . . . . . . . . . . . . . 7
Parker v. Carnahan, 772 S.W.2d 151, 157 (Tex. App.—Texarkana 1989, writ denied) . . . . . . . . . . . . . . . 5
People v. Speedee Oil Change Systems, Inc., 980 P.2d 371, 383 (Cal. 1999) . . . . . . . . . . . . . . . . . . . . . 12
Perez v. Kirk & Carrigan, 822 S.W.2d 261, 265 (Tex. App.—Corpus Christi 1991, writ denied) . . . . . . . . 4
Phoenix Founders, Inc. v. Marshall, 887 S.W.2d 831, 834 (Tex. 1994) . . . . . . . . . . . . . . . . . . . 13
Prigmore v. Hardware Mut. Ins. Co., 225 S.W.2d 897, 899 (Tex. App.—Amarillo 1949, no writ) . . . . . . . 5
Samuels v. Montgomery, 793 S.W.2d 337 (Tex. App.—Houston [14th Dist.] 1990, mand. mtn. overr.)
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Songer v. Clement, 20 S.W.3d 188 (Tex. App.- Texarkana 2000, no writ) . . . . . . . . . . . . . . . . . . . . . . . 17
Terrell v. State, 891 S.W.2d 307, 313 (Tex. App.—El Paso 1994, writ ref’d) . . . . . . . . . . . . . . . . . . . . . 4
Texaco, Inc. v. Garcia, 891 S.W.2d 255 (Tex. 1995) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
The State Bar of Texas v. Dolenz, 3 S.W.3d 260, 270-71 (Tex. App.—Dallas 1999, no writ) . . . . . . . . . . . 8
Vaughn v. Texas Employment Commission, 792 S.W.2d 139 (Tex. App. Houston [1 st dist.] 1990, no writ)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Weiss v. Commission for Lawyer Discipline, 981 S.W.2d 8 (Tex. App. – San Antonio 1998) . . . . . . . . . . 18
Ethics Opinions Cited:
ABA Comm. on Ethics and Professional Responsibility, Informal Op. 372 (1993) . . . . . . . . . . . . . . . . . . . 8
SBOT Ethics Opinion 501–CORRECT CITATION! . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Tx. Bar Journal, Vo. 57, No 7 at 786, July 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Statutory Authority Cited:
Restatement of the Law 3d, The Law Governing Lawyers, Vol. 2, Chapter 8, Section 122, . . . . . . . . . . . . 9
Rule 503 of the Texas Rules of Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
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Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Tex. Penal Code 37.03 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Texas Disciplinary Rules of Professional Conduct (Tex. Disciplinary R. Prof. Conduct, 1989, repeated in Tx.
Gov’t Code, tit. 2, subt. 6, app.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Texas Penal Code, section 37.02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Other Authority:
Jeffrey A. Davis, The Tangled Web: Ethical Issues Involving Conflicts of Interest and Disentangling
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Top Ten Ethical Traps and How to Avoid Them
Chapter 56
TOP TEN ETHICAL TRAPS AND HOW TO AVOID THEM
I.
•
•
of the duties which a member of the
legal profession owes to the public, to
the court, to his professional brethren,
and to his client. Kraushaar, supra.
Introduction This paper seeks to aid the
prac titioner in understanding and focusing on
the obvious. That which is obvious is that the
ethics and personal integrity of the practicing
lawyer, in large part, define the public’s
perception of and trust in the judicial system.
Among the tools available to aid the practicing
lawyer in protecting the public trust must be a
substantial familiarity with the Texas
Disciplinary Rules of Professional Conduct
(The Rules). The following comments examine
the nature of law practice and implicit
conflicting responsibilities. Understanding The
Rules should be the first step of our focus.
Texas Center
Professionalism:
for Legal Ethics and
http://www.txethics.org
The American Academy of
Lawyers Bounds of Advocacy:
http://www.aaml.org
What is generally called the “ethics”
of the profession is but consensus of
expert opinion as to necessity of
professional standards. Cherry v.
Board of Regents of University of
State of New York, 289 N.Y. 148, 44
N.E.2d 405,412.
Ethical:
Of or relating to moral action, motive
or character; as ethical emotion; also
treating of moral feelings, duties or
conduct; containing precepts of
morality; moral; and secondarily as
“professionally right or befitting;
conforming to professional standards
of conduct”. Kraushaar v. Legal
Assistant Vin, 181 Misc. 508, 42
N.W.S.2d 857, 859.
Duty of candor toward the Court
•
Preservation of
confidential
information
•
Duty of fairness to others
Resolution:
Texas Disciplinary Rules of
Professional Conduct (Tex.
Disciplinary R. Prof. Conduct, 1989,
repeated in Tx. Gov’t Code, tit. 2,
subt. 6, app.)
The Top Ten:
1. Failure to define the client;
2. Failure to recognize when a person becomes a
client;
3. Failure to define who is NOT a client;
4. Failure to explain confidentiality of information;
5. Failure to define, identify and avoid conflicts of
interests;
6. Failure to recognize conflicts with former clients;
7. Failure to preclude imputed conflicts (lawyers);
8. Failure to preclude imputed conflicts (nonlawyers);
9. Failure to decline/terminate representation; and
10 Failure to understand why counsel should not
have sex with clients.
Matrimonial
Ethics:
Conflict:•
Preamble to the Texas Disciplinary Rules of
Professional Conduct, Excerpted
1. A lawyer is a representative of clients, an officer
of the legal system and a public citizen having
special responsibility for the quality of justice.
Lawyers, as guardians of the law, play a vital
role in the preservation of society. The
fulfillment of this role requires an understanding
by lawyers of their relationship with and function
in our legal system. A consequent obligation of
lawyers is to maintain the highest standards of
ethical conduct.
Legal Ethics: Usages
and
customs among
members of the legal profession,
involving their moral and professional
duties toward one another, toward
clients, and toward the courts; that
branch of moral science which treats
1
Top Ten Ethical Traps and How to Avoid Them
2.
As a representative of clients, a lawyer
performs various functions. As advisor, a
lawyer provides a client with an informed
understanding of the client’s legal rights and
obligations and explains their practical
implications. As advocate, a lawyer zealously
asserts the client’s position under the rules of
the adversary system. As negotiator, a lawyer
seeks a result advantageous to the client but
consistent with requirements of honest dealing
with others. As intermediary between clients, a
lawyer seeks to reconcile their divergent
interests as an advisor and, to a limited extent,
as a spokesperson for each client. A lawyer
acts as evaluator by examining a client’s affairs
and reporting about them to the client or to
others.
3.
In all professional functions, a lawyer should
zealously pursue clients’ interests within the
bounds of the law. In doing so, a lawyer should
be competent, prompt and diligent. A lawyer
should maintain communication with a client
concerning the representation. A lawyer should
keep in confidence information relating to
representation of a client except so far as
disclosure is required or permitted by the Texas
Disciplinary Rules of Professional Conduct or
other law.
4.
A lawyer’s conduct should conform to the
requirements of the law, both in profes sional
service to clients and in the lawyer’s business
and personal affairs. A lawyer should use the
law’s procedures only for legitimate purposes
and not to harass or intimidate others. A lawyer
should demonstrate respect for the legal system
and for those who serve it, including judges,
other lawyers and public officials. While it is a
lawyer’s duty, when necessary, to challenge
the rectitude of official action, it is also a
lawyer’s duty to uphold legal process.
5.
Chapter 56
be mindful of deficiencies in the administration of
justice and of the fact that the poor, and
sometimes persons who are not poor, cannot
afford adequate legal assistance, and should
therefore devote professional time and civic
influence in their behalf. A lawyer should aid the
legal profession in pursuing these objectives and
should help the bar regulate itself in the public
interest.
7. In the nature of law practice, conflicting
responsibilities are encountered. Virtually all
difficult ethical problems arise from apparent
conflict between a lawyer’s responsibilities to
clients, to the legal system and to the lawyer’s
own interests. The Texas Disciplinary Rules of
Professional Conduct prescribe terms for
resolving such tensions. They do so by stating
minimum standards of conduct below which no
lawyer can fall without being subject to
disciplinary action. Within the framework of
these Rules many difficult issues of professional
discretion can arise. The Rules and their
Comments constitute a body of principles upon
which the lawyer can rely for guidance in
resolving such issues through the exercise of
sensitive professional and moral judgment. In
applying these rules, lawyers may find
interpretive guidance in the principles developed
in the Comments.
11 The rules presuppose a larger legal context
shaping the lawyer’s role. That context includes
court rules and statutes relating to matters of
licensure, laws defining specific obligations of
lawyers and substantive and procedural law in
general. Compliance with the rules, as with all
law in an open society, depends primarily upon
understanding and voluntary compliance,
secondarily upon reinforcement by peer and
public opinion and finally, when necessary, upon
enforcement through disciplinary proceedings.
The Rules and Comments do not, however,
exhaust the moral and ethical considerations that
should guide a lawyer, for no worthwhile human
activity can be completely defined by legal rules.
As a public citizen, a lawyer should seek
improvement of the law, the administration of
justice and the quality of service rendered by
the legal profession. As a member of a learned
profession, a lawyer should cultivate knowledge
of the law beyond its use for clients, employ
that knowledge in reform of the law and work
to strengthen legal education. A lawyer should
Terminology
?Belief” or ?Believes” denotes that the person
involved actually supposed the fact in question to be
2
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
?Substantial” when used in reference to degree
true. A person’s belief may be inferred from
circumstances.
or extent denotes a matter
significance or involvement.
or
? Consultation” denotes
communication of information and advice reasonably
sufficient to permit the client to appreciate the
significance of the matter in question.
of
meaningful
? Consult”
?Tribunal” denotes any governmental body or
official or any other person engaged in a process of
resolving a particular dispute or controversy.
?Tribunal” includes such institutions as courts and
administrative agencies when engaging in
adjudicatory or licensing activities as defined by
applicable law or rules of practice or procedure, as
well as judges, magistrates, special masters,
referees, arbitrators, mediators, hearing officers and
comparable persons empowered to resolve or
recommend a resolution of a particular matter; but it
does not include jurors, prospective jurors, legislative
bodies or their committees, members or staffs, nor
does it include other governmental bodies when
acting in a legislative or rule-making capacity.
?Firm” or ?Law firm” denotes a lawyer or
lawyers in a private firm; or a lawyer or lawyers
employed in the legal department of a corporation,
legal services organization, or other organization, or
in a unit of government.
?Fitness” denotes those qualities of physical,
mental and psychological health that enable a person
to discharge a lawyer’s responsibilities to clients in
conformity with the Texas Disciplinary Rules of
Professional Conduct. Normally a lack of fitness is
indicated most clearly by a persistent inability to
discharge, or unreliability in carrying out, certain
obligations.
Tex. Disciplinary R. Prof’l Conduct, reprinted in
Tex. Gov’t Code Ann., tit. 2, subtit. G, app. A, art.
10 § 9 (Vernon 1998) (hereafter “Rule” or “Rules”).
?Fraud” or ?Fraudulent” denotes conduct
having a purpose to deceive and not merely negligent
misrepresentation or failure to apprise another of
relevant information.
II. LAWYER-CLIENT RELATIONSHIP
A. Who is the Client?
?Knowingly,” ?Known,” or ?Knows” denotes
•
Attorney-client privilege attaches to your
communications made for the purpose of
obtaining legal advice.
•
Protection attaches to communications that
are not privileged but still “confidential.”
(Rule 1.05)
•
The opposing lawyer may not communicate
with your client about the subject of the
dispute once he or she knows counsel is
representing the client. (Rule 4.02)
•
Consultation with potential client who does
not retain attorney may result in attorneyclient relationship and ongoing duty to
protect client confidence. State Bar of
Texas Professional Ethics Committee
Opinion 494 (Tx. Bar Journal, Vo. 57, No 7
at 786, July 1994)
•
Your representation of that client may
effect your ability to represent other
persons or entities. (Rule 1.06-1.09)
actual knowledge of the fact in question. A person’s
knowledge may be inferred from circumstances.
?Partner” denotes an individual or corporate
member of a partnership or a shareholder in a law
firm organized as a professional corporation.
?Reasonable” or ?Reasonably” when used in
relation to conduct by a lawyer denotes the conduct
of a reasonably prudent and competent lawyer.
?Reasonable belief” or ?Reasonably believes”
when used in reference to a lawyer denotes that the
lawyer believes the matter in question and that the
circumstances are such that the belief is reasonable.
?Should know” when used in reference to a
lawyer denotes that a reasonable lawyer under the
same or similar circumstances would know the
matter in question.
3
Top Ten Ethical Traps and How to Avoid Them
•
You have certain limitations on your right
to stop representing that person or entity.
(Rule 1.15)
•
You have a duty to not neglect the client’s
matter entrusted to you. (Rule 1.01)
•
You have a duty to abide by the client’s
decisions concerning the objective and
general methods of representation and
whether to accept an offer of settlement
of a matter. (Rule 1.02)
•
You have a duty to keep your client
reasonably informed about the status of
the matter, promptly comply with
reasonable requests for information, and to
explain a matter to the extent reasonably
necessary to permit the client to make
informed decisions regarding the
representation. (Rule 1.03)
•
Chapter 56
A relationship of client and lawyer arises
when:
(1) a person manifests to a lawyer the
person’s intent that the lawyer provide
services for the person; and either
(a) the lawyer manifests to the
person consent to do so; or
(b) the lawyer fails to manifest lac k
of consent to do so, and the
lawyer knows or reasonably
should know that the person
reasonably relies on the lawyer to
provide the services; or
(2) a tribunal with power to do so appoints
the lawyer to provide the services.
•
Other persons with whom you may be
partners or associated in the practice of
law will in some ways be subject to the
same rules as you with respect to this
client. See e.g. Rules 1.06(f), 1.07(e),
1.08(i), 1.09(b),(c).
B . How is the Attorney-Client Relationship
Formed?
•
Preamble, 12 (Texas Disciplinary Rules of
Professional Conduct)–Most of the duties
flowing from the client-lawyer relationship
attach only after the client has requested
the lawyer to render legal services and the
lawyer has agreed to do so. For purposes
of determining the lawyer’s authority and
responsibility, individual circumstances and
principles of substantive law external to
these rules determine whether a clientlawyer relationship may be found to exist.
But there are some duties, such as of that
of confidentiality, that may attach before a
client-lawyer relationship has been
established.
•
Restatement Of the Law 3d, The Law
Governing Lawyers, Chapte r 2 ,
s ection 14. Formation of a ClientLawyer Relationship.
4
Case Law–No express agreement is
necessary under Texas law to create the
attorney-client relationship. Terrell v. State,
891 S.W.2d 307, 313 (Tex. App.—El Paso
1994, writ ref’d). To the contrary, Texas
courts hold that the relationship may be
implied from the parties’ course of dealing.
Id.; Byrd v. Woodruff, 891 S.W.2d 689,
700-701 (Tex. App.—Dallas 1994, writ
denied) (holding that an attorney’s conduct
in preparing documents after the attorney
contended the attorney-client relationship
ended prevented summary judgment
because such evidence established that the
attorney continued to act in that capacity);
Clarke v. Ruffino, 819 S.W.2d 947, 949
(Tex. App.—Houston [14th Dist.] 1991,
writ dism’d w.o.j.) (holding that an
attorney’s conduct of offering advice even
on a pro forma basis created an attorney
client relationship); Perez v. Kirk &
Carrigan, 822 S.W.2d 261, 265 (Tex.
App.—Corpus Christi 1991, writ denied)
(holding that attorney’s conduct
encouraging an employee to repose trust in
them created an attorney- client relationship
between the attorneys and employee). The
existence or not of an attorney client
relationship does not depend on any
agreement to pay a fee and may arise from
gratuitously provided services. Perez v.
Kirk & Carrigan, 822 S.W.2d at 765;
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Prigmore v. Hardware Mut. Ins. Co.,
225 S.W.2d 897, 899 (Tex.
App.—Amarillo 1949, no writ) (holding
that a contract of employment “may exist
merely as a result of an offer or request
made by the client and an acceptance or
assent thereto by the attorney”).
C. Who is the client when a third party hires
the lawyer and/or pays the bills?
•
•
Regardless of who places the initial call to
the lawyer’s office, attends the initial
conference or pays the fee, make sure
you know, and the client knows, at the
outset the identity of the “client” and
confirm it in writing. It is difficult to
ethically and effectively provide
representation without a clear
identification of the client. You will also
avoid problems with others claiming they
were your client if you make it clear at the
outset they are not. Withdrawing from a
troublesome attorney-c lient relationship
may be a lot less painful if everyone
knows who is the client.
Rule 5.04(c) states, “A lawyer shall not
permit a person who recommends, employs,
or pays the lawyer to render legal services
for another, to direct or regulate the
lawyer’s professional judgment in rendering
such legal services.”
•
Rule 1.05 states that a lawyer may
generally not reveal the confidential
information of a client without the client’s
consent. Confidential information is defined
to include both privileged information and
“all information relating to a client or
furnished by the client, other than privileged
information, acquired by the lawyer during
the course or by reason of the
representation of the client.” If a fee
statement or invoice describes legal
services rendered, it inc ludes information
relating to the client acquired by reason of
the representation.
D. “I am not your lawyer”
•
At the outset of an engagement (and
sometimes during the engagement), it may
be necessary to advise a party that you are
not his, her, or its lawyer (i.e. spouse or
child the subject of the suit, or business
entity of the client). Doing so may not only
help you avoid an awkward situation but
also prevent or at least minimize problems
with others claiming they were your client
with all of the responsibilities such a
relationship entails.
•
A duty to advise that you are not
someone’s attorney arises if you were
aware or should have been aware that your
conduct would have led a reasonable
person to believe she was being
represented by you. Parker v. Carnahan,
772 S.W.2d 151, 157 (Tex.
App.—Texarkana 1989, writ denied).
•
Websites and “Contact Us” sections of
websites where any person with internet
access can send any e-mail to your law
firm increase the risk of receiving
The engagement letter between the
lawyer and the client should do the
following:
1.
2.
3.
4.
•
•
Confirm the engagement.
Define the engagement. It can be
broad.
Identify the client precisely.
Define the fees to be charged, and
the obligation to pay it. (See Rule
1.15(b)(5))
Special attention should be given to the
c lient in the initial engagement letter, and
in appropriate circumstances, identifying
who is not the client. This can prevent
conflict problems in the future under either
1.06 or 1.09. See In re Epic Holdings,
Inc., 985 S.W.2d 41 (Tex. 1998) (dispute
over whether or not the chief executive
officer of a corporate client had also been
a client of the firm).
5
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
unwanted confidential information that
may cause conflicts with existing clients.
A prospective client can click on the
“contact us” button and send an e-mail to
a lawyer in your law firm or organization
which potentially can disqualify the firm
from representing an existing client. With
your website, consider having any
?c ontact us” e-mails go to a webmaster
or other designated person, to screen for
conflicts. The website should also include
a disclaimer explaining that you or your
firm cannot represent the person making
contact on line until there is discussion, an
agreement and a written statement
confirming the engagement.
E.
lawyer’s or law firm’s own interests.
(c) A lawyer may represent a client in the
circumstances described in (b) if:
(1) the lawyer reasonably believes the
representation of each client will not
be materially affected; and
(2) each affected or potentially affected
client consents to such representation
after full disclosure of the existence,
nature, implications, and possible
adverse consequences of the common
representation and the advantages
involved, if any.
(d) A lawyer who has represented multiple
parties in a matter shall not thereafter
represent any of such parties in a dispute
among the parties arising out of the matter,
unless prior consent is obtained from all
such parties to the dispute.
Preventative Measures
•
It is imperative that the client fully
understand both the scope and limitation of
the attorney-client relationship. Although
the attorney shall abide by a client’s desire
concerning the objectives and general
methods of representation, the client must
be informed that the information of a client
protected by the lawyer-client privilege is,
in certain instances, subject to courtordered or ethically required revelation.
(e) If a lawyer has accepted representation in
violation of this Rule, or if multiple
representation properly accepted becomes
improper under this Rule, the lawyer shall
promptly withdraw from one or more
representations to the extent necessary for
any remaining representation not to be in
violation of these Rules.
III. CONFLICTS OF INTEREST
A. Current Clients--Rule 1.06.
Interest: General Rule
•
Conflict of
(a) A lawyer shall not represent opposing
parties to the same litigation.
The rule.
1.
Do not represent opposing parties in the
same litigation.
2.
In other situations, the guiding factor
underlying these rules is the duty of loyalty
and duty to not disclose confidential
information a lawyer owes his or her client.
3.
The practical effect of Rule 1.06(b): A
lawyer may represent client x in a matter
adverse to client y without the consent of
both parties in some circumstances. For
example where the matter in which the
lawyer represents client x is not related to
the matter in which the lawyer represents
client y.
(b) In other situations and except to the extent
permitted by paragraph (c), a lawyer shall
not represent a person if the
representation of that person:
(1) involves a substantially related matter
in which that person’s interests are
materially and directly adverse to the
interests of another client of the
lawyer or the lawyer’s firm; or
(2) reasonably appears to be or become
adversely limited by the lawyer’s or
law firm’s responsibilities to another
client or to a third person or by the
6
Top Ten Ethical Traps and How to Avoid Them
4.
Chapter 56
The reverse of Rule 1.06(b): a lawyer
may take on the representation where:
representation after full
disclosure of the existence,
nature, implications, and possible
adverse consequences of the
c ommon representation and the
advantages involved, if any.”
The representation does not involve:
i.
ii.
iii.
a substantially related matter
in which the interests of client x are
materially and directly adverse to the
interests of client y or the lawyer’s
firm or
the representation
reasonably
appears to be or become adversely
limited by the lawyer’s or law firm’s
responsibilities to another client or to
a third person
5.
Texas is the one of the few if not the only
state that allows lawyers to represent a
client in a lawsuit against another client on
an unrelated matter without client consent.
ABA Model Rule 1.7 prohibits such
representation.
6.
What is ?substantially related”?
•
7.
For purposes of a motion to
disqualify, it has been stated that
“The moving party must prove the
existence of a prior attorney-client
relationship in which the factual
matters involved were so related to
the facts in the pending litigation that
it creates a genuine threat that
confidences revealed to his former
counsel will be divulged to his current
adversary.”
NCNB Texas Nat’l
Bank v. Coker, 765 S.W.2d 398,
399-400 (Tex. 1989).
HECI
Exploration Co. v. Clajon Gas Co.
843 S.W.2d 622 (Tex. App.—Austin
1992, writ denied).
Exception:
?(c) A lawyer may represent a client in
the circumstances described in (b) if:
(1) the lawyer reasonably believes
the representation of each client
will not be materially affected;
and
(2) each affected or potentially
affected client consents to such
7
•
If there is a dispute, the lawyer will
have the burden of proving the
elements of the exception. The State
Bar of Texas v. Dolenz, 3 S.W. 3d
260, 270-71 (Tex. App.—Dallas 1999,
no writ).
•
The comments accompanying Rule
1.06 remind us that taking an
advocacy role against a current client
should be carefully considered even if
the exception is applicable.
“Ordinarily, it is not advisable for a
lawyer to act as advocate against a
client the lawyer represents in some
other matter, even if the other matter
is wholly unrelated and even if
paragraphs (a), (b), and (d) are not
applicable. However, there are
circumstances in which a lawyer may
act as advocate against a client, for a
lawyer is free to do so unless this rule
or another rule of the Texas
Disciplinary Rules of Professional
Conduct would be violated.”( Rule
1.06, Comment 11)
•
As for the first part of the exception,
the lawyer involved will not have
unbridled discretion to decide that
“each client will not be materially
affected”. Instead, this determination
will be made on a disinterested lawyer
standard.
“[W]hen a disinterested
lawyer would conclude that the client
should not agree to the representation
under the circumstances, the lawyer
involved should not ask for such
agreement or provide representation
on the basis of the client’s consent.
When more than one client is involved,
the question of conflict must be
resolved as to each client.” (Rule
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
1.06, Comment 7)
•
•
The other element of an exception
under 1.06(c) is consent after full
disclosure. Remember, if there is a
dispute, the lawyer will bear the
burden of proving this element of the
exception. The State Bar of Texas v.
Dolenz, 3 S.W.3d 260, 270-71 (Tex.
App.—Dallas 1999, no writ).
•
•
Full disclosure. “Disclosure and
consent are not formalities.
Disclosure sufficient for
sophisticated clients may not be
sufficient to permit less
s ophisticated clients to provide
fully informed consent. While it
is not required that the
disclosure and consent be in
writing, it would be prudent for
the lawyer to provide potential
dual clients with at least a
written summary of the
considerations disclosed.” (Rule
1.06, Comment 8.)
•
Disclosure must include the
“existence, nature, implications,
and possible adverse
consequences of the common
representation and the
advantages involved, if any.”
Rule 1.06(c)(2). Sometimes, full
disclosure may not be possible.
Rule 1.05 imposes a duty not to
disclose confidential client
information without the consent
of the client or former client.
Rule 1.05(b)(1).
If the
communication of the
information necessary to comply
with the duty to make full
disclosure to both clients
requires the communication of
confidential information from
client x to prospective client y,
and client x refuses to authorize
the disclosure of its confidential
information, then the exception
under 1.06(c) may not be met.
8
Must the full disclosure and
consent be in writing? The
disclosure and consent do not
need to be in writing, but
comment 8 to Rule 1.06
encourages that “it would be
prudent for the lawyer to provide
potential dual clients with at least
a written summary of the
considerations disclosed.”
In 1993, the ABA issued Formal
Opinion 93-372 stating that in limited
circumstances, advance consent may
be appropriate under the ABA Model
Rules.
•
The opinion noted that the
problem with advance consent is
that the client may not be able to
give the necessary “informed
consent.” Therefore, to allow for
informed consent, a prospective
waiver would probably have to
identify either a potential adverse
party or potential conflicts that
might arise. “The closer the
lawyer who seeks a potential
waiver can get to circumstances
where not only the actual adverse
client but also the actual potential
future dispute are identified, the
more likely it will be that a
prospective waiver is consistent
with the requirement of the
Model Rules that consent be
attended by a consultation that
communicates ‘information
reasonably suffic ient to permit
the client to appreciate the
significance of the matter in
question.’” ABA Comm. on
Ethics and Professional
Res ponsibility, Informal Op. 372
(1993) (citing Model Rules).
•
Further, the Opinion cautioned
lawyers to remember that in
addition to informed consent, the
lawyer must believe that the
representation will not adversely
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
affect the attorney-client
relationship with the original
client.
•
•
•
(3) if it is the same or a substantially
related matter.
(b) Except to the extent authorized by Rule
1.10, when lawyers are or have become
members of or associated with a firm, none
of them shall knowingly represent a client if
any one of them practicing alone would be
prohibited from doing so by paragraph (a).
Texas
courts
have
not
specifically ruled on the matter.
In a case somewhat on point,
the United States District Court
for the Western District of
Texas found an advance
consent that waived any conflict
arising out of the firm’s
representation of another client
in a related matter to be invalid.
City of El Paso v. SalasPorras Soule, 6. F. Supp. 2d
616, 625 (W.D. Tex. 1998).
The case did not determine
whether advance consents
dealing with unrelated matters
are valid.
(c) When the association of a lawyer with a
firm has terminated, the lawyers who were
then associated with that lawyer shall not
knowingly represent a client if the lawyer
whose association with that firm has
terminated would be prohibited from doing
so by paragraph (a)(1) or if the
representation in reasonable probability will
involve a violation of Rule 1.05.
•
Given the foregoing analysis,
one principle seems certain: no
lawyer can rely with ethical
certainty on a prospective
waiver of objection to future
adverse representations simply
because the client has executed
a written document to that
effect.
Under Rule 1.09, there are three
circumstances where a lawyer may not
represent a person against a former client:
(1) If the new client questions the validity
of the lawyer’s work product or
services for the former client. See In
re Epic Holdings, Inc., 985 S.W.2d
41 (Tex. 1998).
(2) If there is a reasonable probability that
the new representation will involve the
disclosure of confidential information
protected by Rule 1.05
See, Restatement of the Law 3d, The
Law Governing Lawyers, Vol. 2,
Chapter 8, Section 122, Comment d,
p. 268-270, 279.
•
Both privileged and unprivileged
information are protected
confidential information under
Rule 1.05. Rule 1.05; Clarke v.
Ruffino, 819 S.W.2d 947, 950
(Tex. App.—Houston [14th
Dist.] 1991, writ dism’d w.o.j.).
•
“Privileged information” means
information of a client protected
by the lawyer-client privilege of
Rule 503 of the Texas Rules of
Evidence or by the principles of
attorney-client privilege governed
by Rule 501 of the Federal Rules
of Evidence. Rule 1.05.
•
“Unprivileged client information”
B . Former Clients --Rule 1.09. Conflict of
Interest: Former Client
(a) Without prior consent, a lawyer who
personally has formerly represented a
client in a matter shall not thereafter
represent another person in a matter
adverse to the former client:
(1) in which such other person questions
the validity of the lawyer’s services
or work product for the former client;
or
(2) if the representation in reasonable
probability will involve a violation of
Rule 1.05.
9
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
means all information relating to
a client or furnished by the
client, other than privileged
information, acquired by the
lawyer during the course of or
by reason of the representation
of the client. Rule 1.05.
S.W.2d 41, 51 (Tex. 1998).
•
•
•
Advice does not need to be
“relevant” in the evidentiary
sense in order to be
“substantially related”. Rather,
the advice need only be “akin to
the present action in a way
reasonable persons would
understand as important to the
issues involved . . . Where parts
of the present action and the
past representation concern the
very same subject matter,
reasonable minds must agree
they are substantially related.”
In re Corrugated Container
Antitrust Litig., 659 F.2d 1341,
1346 (5th Cir. 1981).
The party
moving
for
disqualific ation need not prove
that the matters are so similar
that not disqualifying the lawyer
would threaten to “taint” the
trial. Substantial relationship is
not that high of a standard.
Rather, the two representations
need only involve the same
“subject matter.” American
Airlines, 972 F.2d at 616, 625.
•
If the moving party meets this
burden, “the moving party is
entitled to a conclusive
presumption that confidences and
secrets were imparted to the
former attorney.” Coker, 765
S.W.2d at 400; American
Airlines, 972 F.2d at 614.
•
Even if a party would be
substantially prejudiced by the
disqualification of his counsel,
courts are not inclined to depart
from the substantially related
standard.
Corrugated
Container, 659 F.2d at 1346.
Example: Ex-Wife hired attorney
who represented Ex-Husband in
their divorce, to represent her in
modification proceeding.
The
court found a substantial
relationship between the subject
matter of the former
representation and the
subsequent
adverse
representation. The Court found
that an attorney’s duty to
preserve his client’s confidenc es
outlasts his employment.
Gleason v. Compton, 693
TEST for disqualification:
•
for
(a) an actual attorney-client
relationship between the
moving party and the
attorney he seeks to
disqualify, and
(b) a substantial relationship
between the subject matter
of the former and present
representations.
In re
A merican Airlines, Inc. ,
972 F.2d 605, 614 (5th Cir.
1992); NCNB Texas Nat.
Bank v. Coker, 765 S.W.2d
398, 400 (Tex. 1989).
(3) In the same or substantially related
matter:
•
The
party
moving
disqualification must prove:
An actual disclosure of
confidences need not be
proven in order to
disqualify counsel. Rather,
the test is whether there is
a threat of disclosure
because of the similarity of
the matters. In re Epic
Holdings, Inc., 985
10
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
S.W.2d 564 (Houston [14th
Dist.], 1985, no writ).
the law firm of Piro Nichols
Lilly. Piro represented the
wife in the same divorce
case.
As part of her
employment acceptance, the
attorney agreed that the job
would be available at the
end of the divorce case.
The attorney moved her
offices before the end of the
case, but did not work for
Piro attorneys. The court
looked at Rule 1.09 and held
that there was no evidence
that the attorney was a
member of or associated
with the Piro firm.
Therefore, the firm should
not be disqualified. Samuels
v . M o n t g o m e r y , 793
S.W.2d
337
(Tex.
App.—Houston [14th Dist.]
1990, mand. mtn. overr.).
Example: Husband sought to
disqualify Wife’s attorney under
circumstances where Husband
consulted with another attorney
at Wife’s attorney’s law firm
after Wife had retained the firm.
Court found that as a matter of
law that Wife had an attorney
client relationship with her
attorney/the firm which
preceded Husband’s attempt to
retain the firm, that the subject
matters were substantially the
same and that Wife’s cons ent
was necessary to allow the firm
to represent Husband. Davis v.
Stansbury, 824 S.W.2d, 278
(Houston [1st. Dist] 1992, no
writ).
•
Attorney past employment with
a firm?
•
•
Attorney future
with a firm?
•
C. Imputed Conflicts–Different rules apply for
lawyers and non-lawyers who move from firm to
firm.
If a lawyer represented a
client and then the lawyer
leaves the firm, the
remaining lawyers at the
firm may not represent a
client where (1) the validity
of the former lawyer’s
work product or services
may be questioned; or (2)
where there is a
reasonable probability that
confidential information
may be disclosed. Rule
1.09(c).
1.
employment
An attorney at the Burta
Rhoads Raborn law firm
worked on the firm’s
representation of the
husband in a divorce case.
During the pendency of the
lawsuit, the attorney
accepted employment at
11
LAWYERS
•
Lawyers are governed by Rule 1.06(f)
and Rule 1.09(b).
•
If one lawyer in a firm is disqualified,
all lawyers associated with or
members of the firm are also
disqualified.
•
Example: Plaintiff’s counsel hired an
associate who formerly worked for
defendant’s counsel during the
pendency of the litigation dispute. At
defendant’s counsel’s firm, the
associate never met the defendant and
never worked on a specific assignment
in the case. However, he may have
proofread briefs and attended some
file review meetings. The court held
that plaintiff’s counsel must be
disqualified. “The simple fact is that
[defendant’s] former lawyer is now
associated with his opponent’s lawyer.
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
Rule 1.09 does not permit such
representation.”
Henderson v.
Floyd, 891 S.W.2d 252 (Tex. 1995);
See also Texaco, Inc. v. Garcia,
891 S.W.2d 255 (Tex. 1995).
•
Example: “SBOT Ethics Opinion 501:
In a contrary ruling, this committee
held that there is no nonrebuttable
presumption of conflict where,
previous to Husband retaining his
attorney, his attorney’s former law
partner had consulted with, but was
not retained by his Wife.” The
committee found that Husband’s
attorney never acquired any
confidential information from the
prior partner.
•
What does it mean to be a member
of or associated with a firm? The
meaning of these terms is not clear,
especially because law firms,
themselves, often use different
designations for positions within the
firm.
•
associated with a firm.
For example, an “of counsel”
designation can mean a myriad
of things.
See People v.
Speedee Oil Change Systems,
Inc., 980 P.2d 371, 383 (Cal.
1999) (“Of counsel” attorneys
may be permanent full-time
practitioners who are not on
partnership track, or part-time
affiliates with other personal or
professional commitments, or
potential partners brought in for
a probationary period); Monroe
v. City of Topeka, 988 P.2d
228, 234 (Kan. 1999)
(disqualified “of counsel”
attorney shared office space,
telephone and facsimile number,
and a mailing address, and
generally presented herself to
the public as part of the firm).
The statement that a lawyer is
“of counsel” to a firm does not
establish that he is not
2.
12
•
One court stated that to be a
member of a firm, a lawyer
would have to be a “partner or
[a] shareholder in a professional
corporation, given the usual
meaning of ‘member’ in the
context of a law firm.” Further
to be associated with a firm, the
court stated an attorney would
have to be “an ‘associate’ . . . on
the payroll of law firm as an
employee, given the usual
meaning of ‘associate’ in this
context.”
Samuels v.
Montgomery, 793 S.W.2d 337,
340 (Tex. App.—Houston [14th
Dist.] 1990, mand. mtn. overr.).
•
Contrary to the sometimes
restricted definitions of
?member” or ?associate”, courts
have disqualified firms where the
firms are associated with lawyers
who are not members or
associates in the traditional sense.
Whether attorneys will be found
to be associated with each other
is likely an intensely factual
inquiry depending on the
circumstances of each case. See
Gray v. Memorial Med. Center,
Inc., 855 F.Supp. 377 (S.D. Ga.
1994).
NON-LAWYERS
•
If a non-lawyer (i.e., paralegal, legal
secretary, case clerk, legal assistant)
works at one firm and then leaves and
becomes employed at a firm on the
opposite side of a matter, the nonlawyer’s new firm is not automatically
disqualified from working on the
matter.
The new firm has the
opportunity to show that it has taken
sufficient steps to build a “Chinese
Wall” around the non-lawyer.
•
When a non-lawyer who has worked
on a case switches firms to a new firm
Top Ten Ethical Traps and How to Avoid Them
•
Chapter 56
also working on the same case, two
circumstances are presented:
where disqualification will always be
required:
(a) a nonrebuttable pres umption
arises that the non-lawyer
obtained
confidential
information; and
(b)
rebuttable presumption arises
that the non-lawyer shared this
information . In re American
Home Products Corp., 985
S.W.2d 68, 75 (Tex. 1998);
Phoenix Founders, Inc. v.
Marshall, 887 S.W.2d 831, 834
(Tex. 1994).
(a) when information relating to the
representation of an adverse
client has in fact been disclosed,
or
(b) when screening would be
ineffective or the non-lawyer
necessarily would be required to
work on the other side of a
matter that is the same or
substantially related to a matter
on which the non-lawyer has
worked. Phoenix
Founders,
Inc., 887 S.W.2d at 835.
The second presumption can be
overcome [this is not true when
lawyers switch firms] if the firm
takes sufficient steps to screen the
non-lawyer. These steps include:
•
(a) cautioning the non-lawyer not to
disclose any information relating
to the representation of a client
of the former employer;
(b) instructing the non-lawyer not to
work on any matter the nonlawyer worked on during his
prior employment or regarding
which the non-lawyer has
information relating to the
former
employer’s
representation; and
(c) taking any other necessary
screening precautions .Grant v.
Thirteenth Court of Appeals,
888 S.W.2d 466, 467-68
(Tex. 1994); Phoenix
Founders, Inc., 887 S.W.2d at
835.
•
•
(1) the substantiality of the
relationship between the former
and current matters;
(2) the time elapsing between the
matters;
(3) the size of the firm;
(4) the number of individuals
presumed to have confidential
information;
(5) the nature of the involvement in
the former matter; and
(6) the timing and features of any
measures taken to reduce the
danger of disclosure. Phoenix
Founders, Inc. , 887 S.W.2d at
836.
The
test
for
determining
disqualification is met by
demonstrating a genuine threat of
disclosure, not an actual materialized
d i s c l o s u r e . American Home
Products, 985 S.W.2d at 74; Grant,
888 S.W.2d at 467.
There
are
some
After a firm screens the non-lawyer,
in deciding a motion to disqualify, the
court should consider the practical
effect of this screening.
Factors
bearing on this determination include:
circumstances
13
•
For disqualification purposes, it is
irrelevant whether the non-lawyer was
a full-time employee of the firm or
instead was “freelance” or contract.
American Home Products, 985
S.W.2d at 77.
•
Example:
A legal assistant left
Thompson & Knight (TK) and began
working at David & Goodman (DG).
TK represented the defendant in a
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
collection suit; DG represented the
plaintiffs. While at DG, the legal
assistant billed six-tenths of an hour
on the suit and discussed the case
with the plaintiffs’ lead counsel. The
legal assistant then returned to TK.
DG moved to disqualify TK. On
petition for writ of mandamus, the
Supreme Court of Texas held that
TK was not necessarily disqualified
and instructed the trial court to
consider whether TK effectively
screened the non-lawyer. Phoenix
Founders, Inc. v. Marshall, 887
S.W.2d 831 (Tex. 1994).
•
•
and finding that precautionary
measures taken by firm such as
prohibiting non-lawyer from working
on case and instructing her not to
disclose any information were
sufficient to safeguard against any
threat of disclosure).
IV. TERMINATING REPRESENTATION
A. Rule 1.15. Declining
Representation
or
Terminating
(a) A lawyer shall decline to represent a client
or, where representation has commenced,
shall withdraw, except as stated in
paragraph (c), from the representation of a
client, if:
Example: A legal secretary worked
for the plaintiffs’ lawyers in a lawsuit
arising out of a chemical explosion.
In connection with the lawsuit, the
legal secretary opened client files,
interviewed clients daily, prepared
investigative reports, and monitored
clients’ medical appointments. The
legal secretary then began working at
a firm that represented two of the
defendants. The new law firm did
not inquire into possible conflic ts.
The legal sec retary worked on the
same case at the new law firm. She
did secretarial and clerical work and
scheduled depositions for the case.
After the legal secretary disclosed
that she had previously worked on
the case, the lawyers at the new firm
told her not to disclose to them any
information but allowed her to
continue working on the case. The
Supreme Court of Texas determined
that there was an “unacceptable
danger of prohibited disclosure . . .
exacerbated by the absence of any
effective, institutional screening
mechanisms.” Grant v. Thirteenth
Court of Appeals, 888 S.W.2d 466
(Tex. 1994).
(1) the representation will result in
violation of Rule 3.08 [Lawyer as
Witness], other applicable rules of
professional conduct or other law;
(2) the lawyer’s physical, mental or
psychological condition materially
impairs the lawyer’s fitness to
represent the client; or
(3) the lawyer is discharged, with or
without good cause.
(b) Except as required by paragraph (a), a
lawyer shall not withdraw from
representing a client unless:
(1) withdrawal can be accomplished
w ithout material adverse effect on the
interests of the client;
(2) the client persists in a course of action
involving the lawyer’s services that the
lawyer reasonably believes may be
criminal or fraudulent;
(3) the client has used the lawyer’s
services to perpetrate a crime or
fraud;
(4) a client insists upon pursuing an
objective that the lawyer cons iders
repugnant or imprudent or with which
the lawyer has fundamental
disagreement;
See also Arzate v. Hayes, 915
S.W.2d 616 (Tex. App.—El Paso
1996, writ dism’d) (weighing factors
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Top Ten Ethical Traps and How to Avoid Them
Chapter 56
(5) the client fails substantially to fulfill
an obligation to the lawyer regarding
the lawyer’s services, including an
obligation to pay the lawyer’s fee as
agreed, and has been given
reasonable warning that the lawyer
will withdraw unless the obligation is
fulfilled;
(6) the representation will result in an
unreasonable financial burden on the
lawyer or has been rendered
unreasonably difficult by the client; or
(7) other good cause for withdrawal
exists.
than) declining to represent a former client.
Letters to a client confirming the conclusion
of an engagement or representation can
help prevent a dispute over this issue.
•
If the attorney-client relationship has not
been created, it is easy to decline any
representation of a prospective client.
Make sure you do not say or do anything to
make a potential or prospective client think
you are their attorney until you are ready to
agree to that relationship.
•
Withdrawal permitted by any of paragraphs
b(2) through b(7) is optional for the lawyer
“even though the withdrawal may have a
material adverse effect upon the interests
of the client.” (Comment 8)
•
Although Comment 8 allows withdrawal
with resulting material adverse effect, it is
strongly recommended that the fee
relationship be reduced to written form and
that periodic statements of accrued fees
and costs be furnished to the client.
Additionally, the attorney should take
reasonable steps to avoid foreseeable
prejudice to the rights of the client, allow
time for employment of other counsel, and
deliver to the client all papers and property
to which the client is entitled (Comment to
A.A.M.L. rule 2.4)
•
Withdrawal by counsel following discharge
of client is mandatory under paragraph (a)
(3). Caution should be exercised regarding
any procedurally required act by the
attorney prior to court approval of
withdrawal. Discharge of court-appointed
counsel depends on applicable law and may
preclude appointment of successor counsel
(Comment 5).
•
“Other rules, in addition to Rule 1.15,
require or suggest withdrawal in certain
situations. See Rules 1.01, 1.05, Comment
22, 1.06(e) and 1.07(c), 1.11(c), 1.12(d),
and 3.08(a).” (Comment 10)
(c) When ordered to do so by a tribunal, a
lawyer shall continue representation
notwithstanding good cause for
terminating the representation.
(d) Upon termination of representation, a
lawyer shall take steps to the extent
reasonably practicable to protect a client’s
interests, such as giving reasonable notice
to the client, allowing time for employment
of other counsel, surrendering papers and
property to which the client is entitled and
refunding any advance payments of fee
that has not been earned. The lawyer may
retain papers relating to the client to the
extent permitted by other law only if such
retention will not prejudice the client in the
subject matter of the representation.
•
The Rule–Comments
•
•
Mandatory decline or withdrawal under
(a)(1): 1. if the Lawyer as Witness rules
applies (3.08); 2. there is or likely to be a
conflict of interest (1.06, 1.07, 1.08, or
1.09); 3. the representation is beyond
your competence or you do not have the
time to handle the representation without
neglecting it (1.01); or 4. mandated
?permissible” circumstances presented by
(b)(2) through (b) (7).
Withdrawing from representation of a
client is different from (and more difficult
15
Top Ten Ethical Traps and How to Avoid Them
•
Chapter 56
Withdrawal permitted by any paragraph
(b) subpart may become mandatory under
(a)(1) when the lawyer knows the conduct
will be illegal or in violation of these rules
(Comment 7). Instances which may
convert permissible withdrawal to
mandatory withdrawal include the
following:
•
•
•
testimony on cross-examination.
Ethically, the right thing for the lawyer
to do would be to urge that the false
testimony be corrected or withdrawn.
But, neither Rule 1.05(a)(5), nor
1.05(b) apply to this situation.
However, if the attorney attempted to
use the false testimony later in support
of client’s case, he would violate
1.05(a)(5).
False Testimony–In progress. If the
client or witness makes a statement
while the trial is in progress that you
immediately know to be false,
counsel should ask the court for
immediate opportunity to confer with
the witness such that the testimony
can be corrected or permission to
take the witness on voir dire may be
necessitated to correct the situation.
If the client refuses to correct the
situation, the lawyer should ask to
withdraw from the case. If not
allowed to withdraw, the lawyer shall
take remedial measures as
necessitated by Rule 3.03 a(2), 3.03
b. or 4.01 b.
False Testimony–After the Fact. If
counsel places into evidence
testimony or other material that he
later finds out is false, and the client
refuses to correct or withdraw the
false testimony, the lawyer must take
remedial measures.
The lawyer
must disclose the deception to the
court or to the opposing party.
Although this can cause severe
consequences for the client, the
lawyer must disclose the falsity or he
may be found to have aided in the
deception of the court or the jury
with resulting disciplinary penalties
such as reprimand, suspension, or
even disbarment.
After the Fact–Cross Examination.
Defines a situation where the client
answers truthfully to questions under
direct examination, but offers false
16
•
Client Request to Introduce False
Testimony. If the lawyer is presented
with a situation in which he is asked by
the client to place into evidence
testimony or other material that the
lawyer knows to be false, the lawyer
must refuse to offer it and is obligated
to instruct the client or witness
involved not to offer false or
fabricated evidence. He must also
advise the client of the steps he will
take if such false evidence is offered
which inc lude disclosure to the court
or opposing counsel and possible
withdrawal from the case.
Note,
comment 15 to Rule 3.03 distinguishes
between testimony or other material
that the lawyer knows to be false and
that which is believed to be
untrustworthy, but not known to be
false. In this instance, the lawyer may
refuse to offer the evidence. A more
prudent approach, allowing the client’s
legitimate interests to be advocated is
to offer the support evidence and
allow the finder of fact to assess its
probative value. ?Suspect evidence”
does not trigger sections a(2), a(5),
and b of rule 3.03.
•
Discovery.
Family attorneys
frequently see perjury either in the
form of lies, falsification of or failure
to produce documents, or intentional
failure to disclose material facts in
pretrial discovery. A lawyer who
discovers that the client has lied in
responding to discovery must take all
Top Ten Ethical Traps and How to Avoid Them
•
Chapter 56
reasonable steps to rectify the
deception.
The normal duty of
confidentiality is superseded by the
duty of candor to the tribunal. The
lawyer must first try to convince the
c lient to rectify the situation. If this
proves impossible, it is the
responsibility of the lawyer to correct
the falsity by disclosure to the
necessary parties and/or the Court
once the lawyer becomes aware of
the deception, withdrawal alone is
inadequate.
It is essential that
clients be advised that a trial court
has broad discretion to impose
sanctions, including dismissal with
prejudice, fines, or ordering a new
trial, on a party who abuses the
discovery process. Vaughn v. Texas
Employment Commission, 792
S.W.2d 139 (Tex. App. Houston [1 st
dist.] 1990, no writ)(trial court
imposed a $10,000 fine on employee
for committing perjury in the course
of discovery), Songer v. Clement, 20
S.W.3d 188 (Tex. App.- Texarkana
2000, no writ).
Truthfulness in Statements to Others.
A lawyer violates Rule 4.01 and falls
under the purview of Rule 1.15 only
if the lawyer knows that the
statement of law or material fact is
false and intends thereby to mislead.
This trap is also opened by
incorporating or offering such a
statement by others. As relates to
acts or statements made by the client,
the lawyer generally has no duty to
inform a third person of relevant
material facts unless pursuant to
formal discovery.
However,
remedial actions, possible disclosure
to the court and mandatory
withdrawal may follow if the lawyer
knows the client is perpetrating a
crime or fraud and the lawyer, by
failure to act pursuant to the rules
requiring remedial efforts, becomes a
party to the crime or fraud. The
lawyer’s misconduct is defined by an
intent to mislead. As relates to client
committed criminal or fraudulent acts
with use of lawyer services, remedial
action must be urged before 4.01(b)
mandates become necessary.
Case Law
17
•
Perjury. Pursuant to section 37.02 of the
Texas Penal Code, it is a Class A
mis demeanor for a person, with intent to
deceive and with knowledge of the
statement’s meanings, to make a false
statement under oath or swear to the truth
of a false statement previously made and
the statement is required or authorized by
law to be made under oath. Hick s v. State,
864 S.W.2d 693 (Tex. App. Houston [14th
dist.] 1993, no writ). Aggravated perjury is
committed when the false statement is
made during or in connection with an
official proceeding and is material. This
offense is a third degree felony. Tex. Penal
Code 37.03. Brasher v. State, 715 S.W.2d
827 (Tex. App. Houston [14th dist.] 1986,
no writ). In Martin v. State, 896 S.W.2d
336, 340 (Tex. App.- Amarillo 1995, no
writ), the Court found that a statement
sworn to before a notary public is a
statement “authorized by law to be made
under oath”. Intent to commit perjury, like
any other crime, is an exception to Rule
1.05 of the Texas Rules of Professional
Conduct.
•
“The attorney is the agent of the client, and
the work product generated by the attorney
in representing the client belongs to the
client.” In re George, 28 S.W.3d 511, 516
(Tex. 2000). Hebisen v. State, 615 S.W.2d
866, 868 (Tex. Civ. App. – Houston [1st
Dist.] 1981, no writ).
•
An attorney representing a party in a
lawsuit who files a motion to withdraw is
the attorney until the court grants the
motion. Ditto v. State, 898 S.W. 2d 383
(Tex. App. – San Antonio 1995) rev’d on
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
other grounds 988 S.W.2d 236 (Tex.
Crim. App. 1999).
•
•
Under 1.15(d), a lawyer is required to take
steps to the extent reasonably practicable
to protect the interests of the client upon
termination of the relationship. Where
the lawyer took no action for one year
after learning the tortfeasor / potential
defendant had no insurance and
terminated the representation 31 days
before the statute of limitations ran, not
giving the client time to find new counsel,
the lawyer was guilty of professional
misconduct.
Belt v. Commission for
Lawyer Discipline, 970 S.W.2d 571 (Tex.
App.—Dallas 1997, no writ). Moss v.
Malone, 880 S.W.2d 45 (Tex.
App.—Tyler 1994, writ denied).
•
Privilege
The Supreme Court of Texas has
determined that in these situations, there are
two different types of documents and two
different rules that apply:
(1) Pleadings, discovery, correspondence,
and other documents in the public
record or exchanged by the parties:
Where lawyer did not return entire file to
client upon termination of relationship, but
client was not prejudiced, lawyer was not
guilty of professional misconduct. Weiss
v. Commission for Lawyer Discipline,
981 S.W.2d 8 (Tex. App. – San Antonio
1998).
C. M a i n t a i n i n g
Disqualification.
•
•
•
Successor
counsel
is
presumptively entitled to these
documents.
•
If confidential information was
revealed in these documents, the
former client can try to protect
the confidences by moving to seal
the documents or by seeking a
protective order.
(2) Work Product of the disqualified
counsel
•
The Court defined “work
product” in this circumstance to
mean “all of the materials the
attorneys created in anticipation
of litigation or for trial that has
not been placed in the public
record or shared with the other
side.”
•
Generally, the attorney is agent
for the client and therefore all
work generated belongs to the
client. However, in this situation,
this defeats the purpose of the
original disqualification.
•
Therefore, the Supreme Court of
Texas has developed a TEST:
following
This situation arises when counsel is
disqualified because of prior access to
confidential information; for example,
counsel was disqualified because of a
conflict of interest under 1.06 or 1.09.
When suc cessor counsel is hired, what
documents from the original counsel may
this successor counsel access?
Successor counsel will want and need
access to the documents maintained by
disqualified counsel in order to know the
status of the lawsuit and for efficiency,
cost, and fairness to the client. However,
there is a competing interest because
allowing successor counsel access to all
documents defeats the underlying purpose
of the original disqualification.
(a) a rebuttable presumption
that the work prod u c t
contains confidential
information arises when the
former client establishes that
the two representations are
substantially related.
18
Top Ten Ethical Traps and How to Avoid Them
Chapter 56
(b) The current client can
rebut the presumption by
showing there is not a
substantial likelihood that
the items of work product
contain or reflect
confidential information.
•
V.
a firmly grounded sense of professional integrity.
However, common sense, intuition and patience
should not be tools left behind when one goes to
work.
Once the successor counsel
moves for access to documents
or the former client moves to
restrict access, the trial court
s hould order the disqualified
attorneys to produce an
inventory of the documents.
The inventory for each item of
work product should include the
type of work, the subject matter
of the work, the claims the work
relates to, and any other
relevant information. The court
should then consider the nature
of the work (case and deposition
summaries are less likely to
contain confidential material
than attorney’s notes), the
subject matter of the work (legal
research on evidentiary and
procedural issues are less likely
to contain confidential
information), and other factors.
If necessary, the court should do
an in camera inspection. If
after these steps the court
cannot determine whether the
material contains confidential
information, the presumption is
not rebutted. In re George, 28
S.W.3d 511 (Tex. 2000). (This
case is the second mandamus
proceeding of In re Epic
Holdings, cited above).
Conclusion
The Texas Disciplinary Rules of Professional
Conduct offer both guidance and shelter to the
lawyer confused and conflicted. Careful review of
the Rules allows ethical refuge for the lawyer with
19