Law Practice
Management
Class #6 – Conflicts and Bar
Grievances
Conflicts of Interest
• Need to be sensitive to conflicts of interest
• Not all conflicts are apparent at beginning
of representation
– Need to look forward to anticipated
developments in case (witnesses, experts,
etc.)
– Need to take steps in advance to resolve
conflicts or, if not resolvable, decline
representation or withdraw
Common conflicts
• Represent two or more plaintiffs against
same defendant
– Even where actions are unrelated, there may
be a collection-related conflict
• Parties with contrary legal
positions/theories
– Exacerbated if in same court
– Winning for one client often means losing for
other
Common conflicts (cont.)
• Partnerships
– Representing multiple partners
– Representing both a partner and the
partnership itself
• Corporations
– Representing multiple directors
– Representing both a director and the
corporation itself
Common conflicts (cont.)
• Divorce cases
– NEVER represent both spouses
– Don’t pretend to represent the children unless you are
appointed to do so by the court
– Decline to represent either spouse if you previously
represented both spouses in matters such as estate
planning or closely-held businesses
• Watch for “shoppers” who meet with lawyers just
to disqualify them from representing spouse
– Good reason not to offer free consultations
Common conflicts (cont.)
• Multiple defendants or potential
defendants in criminal or civil cases
– Criminal defendants may turn on each other
to cut a plea deal in exchange for testimony
– Civil defendants may try to shift liability to
other defendant(s)
• Passenger and driver in auto accident
cases
– Owner/driver liability may be issue
What can happen to lawyer if
conflict is ignored or mishandled?
• Withdrawal from case
• Become object of motion to disqualify
– Heard in open court in front of your peers
• May not be able to collect fees due
• May have to refund fees already collected
• May face disciplinary proceedings or
malpractice litigation
What can happen to client in
conflict of interest cases?
• Need to retain new lawyer
• Delay associated with bringing new lawyer
up to date on case
• Delay in court date and ultimate resolution
of matter
Resolve conflict FIRST
• Better to recognize conflict and avoid
working on case than to work on case,
then find conflict, and not get paid
• Everyone has to “eat crow” (admit
mistake) sometime
• Better to do so when crow is young and
tender rather than when crow is old and
tough
Waiver of conflict?
• Conflict does not preclude representation
if conflict can be waived
• Some conflicts should not be waived
– Such as representing both spouses in a
divorce
• Always get conflict waiver IN WRITING
– See Foonberg pp 224-227 for sample waiver
clauses
Ethics problems
• Avoiding an ethics war is much better than
winning one
• Collateral damage to your reputation is
serious and permanent even if you prevail
• The time and effort it takes to win an
ethics battle could be better spend on feegenerating client work
Ethics Hotlines
• Most State Bars Have Some Form of
Ethics Hotlline
– FL Ethics Hotline for Oral Advisory Opinion
call (800) 235-8619
– Written Ethics Opinion (3-5 weeks) write to FL
Bar (standard request form online)
Common ethics issues
• Amount of Fee
– Generally must be “reasonable”
– If unsure what to charge, call other lawyers
with experience in the area
– Fee agreement must be in writing
– Keep accurate time records
Common ethics issues (cont.)
• Fee Splitting
– Must be disclosed to client
– Fee must not increase due to fee-splitting
arrangement
– Can’t split fees with non-lawyers or, in most
cases, with out of state lawyer
• Exception is with non-profit lawyer referral
agencies approved by the Bar (usually run by local
bar association)
Common ethics issues (cont.)
Fee Splitting in Florida - FL Rule 4-1.5(g)
• total fee must be reasonable
• division of fees in proportion to the
services performed by each lawyer
• written agreement with the client:
– discloses the basis upon which that division
will be made
– each lawyer assumes joint legal responsibility
for the representation
– each lawyer is available for consultation with
the client.
Common ethics issues (cont.)
• Fees paid by third parties
– Duty is to client, not person paying fee
– Fee agreement should state that duty will be
to client, not fee payer, if conflict arises
– Common problem when insurance carrier is
paying fee for the insured
Common ethics issues (cont.)
• Failure to refund unearned fees
– Fee agreement should be clear that fee is flat
or fixed and not dependent on time devoted to
matter, continued representation, or result
achieved
• Dropping client for failure to pay
– Place appropriate clause in agreement letting
you get out if client doesn’t pay
– Court permission required for litigation
matters
Common ethics issues (cont.)
• False billing practices
– Overstating number of hours worked on case
• Often to make up for unrealistically low hourly rate
– Misstating who did the work
– Billing for paralegal time at lawyer’s rate
Common ethics issues (cont.)
• Depositing fee advance prematurely in to
operating account
– Unless the fee is specified as non-refundable
(and meets certain other requirements), fees
are not earned until the work is done
– Ethical violation to deposit or transfer such
funds into firm operating account before fee is
earned
Common ethics issues (cont.)
• Suing clients for unpaid fees
– Expect counter-claim for malpractice
• Waiting until malpractice statute of limitation runs
may limit counter-claim to amount of fees in
dispute
– Before you sue, make sure your file is in order
and you have done an exemplary job for the
client
– Consider ADR (mediation or arbitration)
• Juries don’t like lawyers, and especially don’t like
suits for fees
Common ethics issues (cont.)
• Lack of a written fee agreement
– No written agreement often means not getting
paid or being forced to take less than the full
amount billed
– Agreement often defines scope of
representation, which is important to avoid
being pulled into disputes that were not
contemplated
– Agreement should have client’s signature as
well as lawyer’s signature
Common ethics issues (cont.)
• Failure to communicate all settlement
offers
– May think offer is totally unacceptable, but
must still advise client of offer
– Free to offer your recommendation on offer
Common ethics issues (cont.)
• Failure to keep client informed of progress
of matter
– Copies of all incoming and outgoing
correspondence, pleadings, emails, etc.
– Foonberg says “bombard them with paper” at
p 542
– Client should have a file nearly complete as
your own
• Some firms provide nice binders for this purpose at
beginning of representation
Common ethics issues (cont.)
• Media advertising
– Follow the three “T’s”
• Truthful
• Tasteful
• Tentative
– Do not guarantee results
– Most complaints come from fellow lawyers,
not clients
Common ethics issues (cont.)
• Indirect media advertising
– Keep yourself in the news
• Frequent press releases trumpeting
accomplishments and awards
• Keep a list of all media contacts in your area
including email addresses, fax numbers, telephone
numbers, etc.
– Recognize when case related publicity may
be helpful to you but hurt your client – Avoid
crossing this line
Common ethics issues (cont.)
• Nonsolicitation mailings
– Firm newsletters
• Paper and email
– Announcements
– Brochures
– Holiday cards
– PR mailings with copies or excerpts of articles
about self or firm
Common ethics issues (cont.)
• “No recovery, no fee” advertising
– Client may still be liable for costs, which can
be substantial
– May also be sanctions or other penalties for
non-meritorious filings
Common ethics issues (cont.)
• Selection of firm name
– Many jurisdictions have restrictions on
fictitious names
• Often can’t use name that sounds like a research
or educational non-profit institution
– Can’t always use names of deceased lawyers
– Can often use names that describe the nature
of the firm’s practice
• “Business Litigation Group”
• “Environmental Law Group”
Common ethics issues (cont.)
• Buying or selling law practice
– Many states still prohibit the direct sale or
purchase of a law practice
– Forming entity for merger purposes, then
transferring “goodwill” is a workaround
Common ethics issues (cont.)
• Coaching a client to lie
– Ethical violation everywhere
– Some jurisdictions require lawyer to withdraw
and blow whistle on client if lawyer is
convinced that the client lied
Common ethics issues (cont.)
• Failure to turn over client file when
discharged
– Must return to client all property, including
documents, that belong to the client
– Must provide copies of all other file
documents
• Who bears the copying cost varies with jurisdiction,
but this can often be specified in the fee
agreement
Common ethics issues (cont.)
• Premature destruction of client file
– Should first return documents belonging to
client
– Must be able to demonstrate compliance with
file retention policy
– Best to have policy in fee agreement signed
by client
– Archive paper files on CD or DVD
Common ethics issues (cont.)
• Inadvertent violations of Attorney-Client
confidences
– Discussion of client matters in public places
– Misdirected mail, faxes, emails
– Sending enclosures to wrong person via mail
(or attaching wrong files to email)
– Failure to use “Personal and Confidential” on
sensitive mail, faxes, email
– Not protecting identity of client
Common ethics issues (cont.)
• Failure to teach client confidentiality to:
– Members of lawyer’s family
– Independent contractors
– Office staff and others who come into contact
with case file
• Special problem in smaller or close-knit
communities
Common ethics issues (cont.)
• Trust account violations
– Overdrawing trust account usually ethical
violation “per se” with no defense
– Taking client funds for personal use almost
always results in suspension or disbarment
Common ethics issues (cont.)
• Getting into business deals with clients
– Never trade fees for a “piece of the action” in
a questionable business venture
– Foonberg, p 555: “A lawyer who wears two
hats has no head”
– May move services outside of your
malpractice policy coverage
Common ethics issues (cont.)
• Alternative billing methods
– Results-oriented “bonus” fees not permitted in
every jurisdiction or in all types of cases
• Florida does not permit results-oriented fees in
family law cases because they too closely
resemble an impermissible contingent fee
Common ethics issues (cont.)
• Overly “zealous” representation of client
– Rule permitting zealous representation not a
blank check to win at all costs
– Zealous is not the same as hostile or
aggressive
– Often results in running up a bill the client is
unable or unwilling to pay
• Balance duty to client with duty to legal
system and duty to society
Common ethics issues (cont.)
• Filing non-meritorious cases
– Failure to adequate investigate facts
– Failure to develop a legal theory on which
recovery may be obtained
• Sanctions can be levied against client,
lawyer, or both
• Sanctioned client will often grieve or sue
lawyer who gave bad advice
Common ethics issues (cont.)
• Communicating with adverse party
represented by counsel
– Happens far too often in family cases
• Communicating “ex parte” with court or
court staff
– Limit communication to procedural issues
such as confirming court dates, etc.
Common ethics issues (cont.)
• Suppressing or sanitizing evidence
– Don’t hide discoverable evidence or counsel
clients to do so
– Don’t alter or “clarify” documents
Foonberg’s 10 Rules
1. Discuss fees and expectations with client
at beginning of representation
2. Have written fee agreement
3. Bombard clients with paper (today,
emailed PDF versions of paper)
4. Return all telephone calls promptly
5. Be open and honest with bad news for
client
Foonberg’s 10 Rules (cont.)
6. Hands-off client’s money (no dipping into
trust account before fee is earned)
7. Cooperate fully with substitute counsel
when you are discharged
8. Respond immediately and completely to
all disciplinary inquiries
9. Keep accurate time records
10. Read and understand your state’s ethical
rules and interpretive opinions
If you violate the rules…
Types of Discipline in FL - Rule 3-5
• Admonishment
– Only applies to “Minor Misconduct”
• Probation for 6 months to 3 years
– Professionalism Enhancement Program
– Supervision by another Bar member
– Restrictions on Advertising
• Public Reprimand
• Suspension
– Indefinite or Term of Up to 3 Yrs
– More Than 90 Days Requires Proof of Rehabilitation
• Disbarment
Minor Misconduct?
• Cannot involve misappropriation of client fund
– Many trust account violations will not be merely
“minor misconduct”
• Cannot result in actual prejudice to a client
• Cannot include dishonesty, misrepresentation,
deceit, or fraud
• Cannot constitute a felony
• Lawyer cannot have been disciplined in any way
in past 3 years
• Lawyer cannot have been disciplined for same
type of misconduct in past 5 years
If Suspended or Disbarred…
• Must Send Notice to Clients, Opposing
Counsel and Courts of the Disciplinary
Decision
• Forfeiture of Fees
• Payment of Restitution
• Payment of Costs of Disciplinary
Proceedings
Problem #7
What law practice management techniques
can be used to minimize the risk of a Bar
grievance?