MARYLAND STATE BAR ASSOCIATION, INC.
COMMITTEE ON ETHICS
ETHICS DOCKET NO. 1990-19
Conflicts - Representing driver in lawsuit after having represented passenger in prior lawsuit
Your letter of inquiry poses the following facts. Several years ago, A, a longstanding client of Attorney X, was involved in an automobile accident with B, the other driver. A and her passenger, C, were injured as a result. The insurance company representing B, D Corporation, alleged that Attorney X's client, A, was contributorily negligent and would not settle the claims of A and C. Attorney X, then representing only C, filed suit against B; D Corporation subsequently impleaded A as a third-party defendant to C's claim. The insurance company representing A, E Corporation, independently and without any solicitation from Attorney X, offered to contribute toward the settlement [the contribution was equal to half of C's claim]. Attorney X accepted this offer from E Corporation. Approximately two and one-half (2.5) years later, A has asked Attorney X to represent her in a suit against B for the injuries A sustained due to that same accident. You have asked us to assist you in determining whether, because Attorney X accepted funds contributed by A's insurance company, Attorney X may represent A in her lawsuit against B.
The first ethical concern involves the general principles of Conflict of Interest, as expressed in Rule 1.7 of the Maryland Rules of Professional Conduct. Rule 1.7 is set forth as follows:
(a) A lawyer shall not represent a client if the representation of that client will be directly adverse to another client, unless:
(1) the lawyer reasonably believes the representation will not adversely affect the relationship with the other client; and
(2) each client consents after consultation.
(b) A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person, or by the lawyer's own interests, unless:
(1) the lawyer reasonably believes the representation will not be adversely affected; and
(2) the client consents after consultation.
(c) The consultation required by paragraphs (a) and (b) shall include explanation of the implications of the common representation and any limitations resulting from the lawyer's responsibilities to another, or from the lawyer's own interests, as well as the advantages and risks involved.
It is unimportant in determining the existence of a conflict whether the two "matters" are the identical or completely unrelated. In either case, because an attorney whose clients are in an adversarial position cannot properly consider the needs and concerns of both clients, an attorney should decline representation, or withdraw, if an impermissible conflict arises.
The circumstances surrounding the suit of A against B are much different than those involving C against B (and A). The interests of A and C are not adverse in any manner because A seeks compensation for his/her own injuries as caused by B, and does not seek reimbursement for the contribution made by E Corporation on A's behalf. Unless there were any privileged communications between Attorney X and C which would disadvantage C in any way, the rules governing conflict of interest do not appear to bar Attorney X from representing A.
The other ethical rule which is involved in resolving your inquiry is Rule 1.9. This rule, which concerns Conflict of Interest with respect to former clients, disallows an attorney who has formerly represented someone in a matter from representing another person in the same or substantially related matter where the former client has interests which are materially adverse to the potential client. In the initial lawsuit, this Rule did not preclude Attorney X from representing C, even after A was impleaded into the case, because, although the relationship was presumably adverse, Attorney X never represented C in the same matter in the past. In the present situation, although the matters are conceivably substantially related, A and C are not simultaneously in an adverse position. As mentioned above, the issues do not concern C in any respect. Thus, both suits appear to fall outside the scope of Rule 1.9.
If Attorney X is disqualified by Rule 1.9, Attorney X can nevertheless request C, after full disclosure of Attorney X's intended representation of A, to "waive" the disqualification of Attorney X. Any waiver and consent must conform to the standards set forth above in Rule 1.7.
Hence, based on the foregoing, acceptance of the funds by Attorney X in C's suit against B (and A) does not appear to ethically bar Attorney X from representing A in her suit against
References: Rules 1.7 and 1.9 of the Maryland Rules of Professional Conduct