Duty of Loyalty - Conflicts of Interest Flashcards
Imputation
Conflicts are imputed onto other lawyers of a firm when the first lawyer has a conflict of interest.
When is a conflict imputed?
When lawyer knew or should have known another lawyer had a conflict.
What are the two conditions for a conflict when lawyer must not represent a client?
Directly adversarial to another client
Significant risk that rep will be materially limited by the lawyer’s personal interest or responsibilities to another client
What are the four conditions that would resolve a conflict?
Lawyer reasonably believes he can rep both with competence and diligence
Rep is not prohibited by law
Rep does not involve claims of one client against another where lawyer is on both sides of litigation
Affected clients give consent that is memorialized in writing
What are the direct adversity conflicts?
Lawyer represents multiple clients in the same matter
Lawyer reps client who is an adverse party in another action lawyer or his firm are handling
Lawyer accepts new client in matter that is adverse to an existing client of the lawyer or firm
Is economic diversity enough to create direct adversity?
No. They can be competitors just not in the same matters.
What are some examples of conflicts that would have a substantial risk of material limitation of representation?
Rep of multiple parties of the same matter
corporation and its directors
partners in a business
spouses creating wills and trusts
When lawyer owes duty to a third person - serves on board of directors
When lawyer has a personal or financial interest in the matter
What are the conditions that allow for a lawyer to acquire an ownership, possessory. security, or money interest that is adverse to the client?
Fair and reasonable to client
Terms of deal fully disclosed to client in writing
Client has reasonable opportunity to seek advice from independent counsel
Client consents in writing
Business with Client - First Discuss Over Coffee
Fairness
Disclosure
Outside counsel
Consent
Examples of business with a client to look out for
Accepting stock for payment
Borrowing money from client
Purchasing property fromc lient
Selling property to client
Taking interest in client property as security for payment of fees
What is misuse of client confidential information?
Using confidential information to client’s disadvantage or advantage of lawyer or 3P
unless client consents/exception applies/candor to the tribunal rule applies
Can a lawyer solicit a gift from a client or prepare an instrument on behalf of client giving gift to the lawyer?
No UNLESS the client is related to the recipient lawyer.
Can the lawyer provide financial assistance to a client with pending or potential litigation?
Advance court costs and expenses YES as a contingency fee agreement
If client is indigent - lawyer may pay court costs and fees
When can a lawyer make an aggregate settlement agreement?
Lawyer discloses the nature of all claims involved and people participating in the agreement
Each client consents after consultation
When can a lawyer accept payments from someone other than the client?
Client consents after consulation
no interference with lawyers jugment or the lawyer client relationship
confidential information is protected
