LEO: Conflict of Interest - Fees/Attorney's LE Op. 1244

 

Conflict of Interest - Fees/Attorney's Lien - Personal Injury

Practice: Law Firm Representing Plaintiff and Defendant;

Asserting Attorney's Statutory Lien After Withdrawal.

 

June 13, 1989

 

You have asked the Committee for guidance as to any impropriety of the

law firm's conduct with regard to the continued representation of

plaintiff in a personal injury action after disclosure of a conflict of

interest when the plaintiff was informed by letter of the representation

of the defendant by another partner of the law firm. In addition, you have

inquired whether the attorney may assert a statutory lien under the

circumstances, after plaintiff/client discharges the law firm from further

representation.

 

The following is a summary of the relevant facts which form the basis of

your inquiry. Attorney A of Law Firm X was retained by plaintiff,

concerning a personal injury matter, while Attorney B, a partner of A's,

was discussing the representation of defendant with regard to the same

accident with a member of defendant's family. Both Attorney A and his

partner initiated the routine letters and notifications to develop the

file and both were unaware of the involvement of the other. This mutual

unawareness continued until plaintiff received the letter of

representation of defendant by Law Firm X at which time plaintiff

contacted Attorney A to discuss the implications and ramifications of Law

Firm X's past and continued involvement. As a result, Attorney B advised

defendant and his family of the circumstances and, with the consent of the

defendant and his family, Attorney B withdrew as counsel and sealed the

client's file with instructions not to open without permission of Attorney

B. In addition, all persons in the office who knew anything about the file

or were involved with Attorney B were instructed not to discuss the matter

with Attorney A. Attorney A continued in the representation of plaintiff

with his consent. Subsequently, Attorney A was discharged, whereupon he

notified plaintiff's new counsel that a statutory lien was being asserted

for the previous services rendered on behalf of plaintiff. The only

discussions between Attorney A and his partner, Attorney B, have regarded

the possibility of a conflict of interest and the possible appearance of

impropriety, issues which were raised by plaintiff's new attorney.

 

The Committee believes the appropriate and controlling disciplinary rules

relative to your inquiry are DR:5-105(B) and (C), which provide that a

lawyer shall not continue multiple employment if the exercise of his

independent professional judgment on behalf of a client will be, or is

likely to be adversely affected by his representation of another client,

unless it is obvious that he can adequately represent the interests of

each and if each consents to the representation after full disclosure of

the possible effect of such representation on the exercise of the

attorney's independent professional judgment on behalf of each. Under the

facts as provided, the Committee would opine that there has been no

impropriety relative to Law Firm X's conduct with regard to the

simultaneous representation of plaintiff and defendant in the instant

matter. Where, in the initial stages of taking on representation of a

client, an attorney or his client learns that a partner of the attorney

represents the opposing party, the client should be so advised and the

client should be given the opportunity to determine if the attorney should

withdraw under the circumstances. It appears that Attorney B consulted his

client who then consented to allow Attorney B to withdraw as counsel with

the promise of preserving all information gained in the attorney/client

relationship as privileged. Thus, assuming that plaintiff consented to the

continued representation by Attorney A after full and adequate disclosure

under the circumstances, the continued representation of plaintiff by

Attorney A is ethically permissible providing that Attorney A does not

become privy to any confidences or secrets gained during the

representation of defendant by Attorney B.

 

The Committee is also of the view that, under the facts indicated,

Attorney A would be within his rights to assert a statutory lien pursuant

to 54.1-3932 of the Code of Virginia, based on the application of

quantum meruit for the reasonable value of the services rendered by

attorney if the fee was based on a contingency agreement. (See Heinzman v.

Fine, Fine, Legum & Fine, 217 Va. 958, 234 S.E. 2d 282 (1977) and LE

Op. 936) The satisfaction of the lien may be a matter of factual dispute

and as such the resolution of the dispute and the sums involved are beyond

the purview of the Committee.

 

Committee Opinion June 13, 1989