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CONFLICT OF INTEREST AND THE LAWYER IN CIVIL PRACTICE

At the heart of the skills which a lawyer offers to his client
is the exercise of his independent professional judgment. Given
the realities of the Anglo-American adversary system, a lawyer’s
total loyality must be to his client, restricted only by his duty to
the court and to the law. An adversary system of jurisprudence
simply will not work if a litigant’s attorney has loyalities which
conflict with the best legal interests of the client. Thus, the necessity
that lawyers avoid conflicts of interest is a keystone of the
profession. Yet, little has been written about the subject, and
lawyers often appear insensitive to conflict of interest problems.

The following survey analyzes some major conflict of interest
problems, concentrating especially on civil practice. Readers interested
in the somewhat different problems of conflicts of interest
in criminal cases will find that those problems have received
more attention in the case law than those on the civil side.

1
A few studies have focused on conflicts of interest in specific
kinds of civil cases,2 but conflict problems arise so often in civil
litigation3 that the subject should be explored more carefully in
professional literature.

CONFLICT OF INTEREST AND THE LAWYER IN CIVIL PRACTICE

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The first code of ethics regulating the legal profession,
adopted by the American Bar Association in 1908, expressly prohibited
an attorney from representing conflicting interests unless
all concerned consented after a full disclosure of the facts. In the
1970 Code of Professional Responsibility, the American Bar Association
promulgated an even stricter, and certainly more
extensive, set of rules governing conflicts of interest. Unlike the
earlier code, the Code of Professional Responsibility adopted disciplinary
rules and ethical considerations which generally prohibit
a lawyer from participating in any conflict of interest situation.

Even the client’s consent to such representation will not save
it. The Code thus stresses the need of the lawyer to “exercise professional
judgement [sic] solely on behalf of his client,”5 thus prohibiting
a lawyer from putting himself in a position where his own
interest, those of other clients or third parties, or political, social
or economic pressures are likely to infringe on the independent
exercise of his judgment.
LAWYER’S SELF-INTEREST V. THE INTEREST OF THE CLIENT
The most obvious conflicts of interest are those in which the
lawyer’s personal interests clash with those of the client. The
Disciplinary Rules expressly prohibit the creation of such a situation:

Except with the consent of the client after full disclosure,
a lawyer shall not accept employment if the
exercise of his professional judgment on behalf of his
client will be or reasonably may be affected by his own
financial, business, property, or personal interests.6
Obviously, the client’s rights to full and disinterested service by
his lawyer will be meaningless if the lawyer must choose between
his own and the client’s interests. A few examples of such selfinterest
will underscore the reasons for the express prohibition
contained in the Code.
to be a general belief that many client complaints about lawyers relate to
real or perceived conflict of interest problems.
4. ABA CANONS OF PROFESSIONAL ETHICS No. 6 (1908).
5. EC 5-21. The Code of Professional Responsibility has been almost
universally adopted by the states, with modifications to suit local traditions.
The rules of the Code are commonly called Disciplinary Rules, and will be
cited as “DR” throughout the text and footnotes in this article. The Disciplinary
Rules are supported by more general Ethical Considerations, cited
“EC” throughout the text and footnotes of the article.
6. DR 5-101(A).
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CONFLICT OF INTEREST
When an attorney has a financial interest in the outcome
of litigation, other than fees, the temptation to further that interest
to the detriment of the client may be difficult to overcome.
For example, an advocate working on a case drawing considerable
public attention might be tempted to accept exclusive
publication rights in the story of the case as part of his fee.
The Code recognizes the danger of such financial interest, since
a lawyer may be “influenced, consciously or unconsciously, to a
course of conduct that will enhance the value of his publication
rights to the prejudice of his client.”

7
The same prejudice may come to bear when an attorney with
an interest in a business venture is requested to give business
or investment advice. In such a situation, the lawyer must give
careful thought to the scope of any recommendation he may give.

If he chooses to suggest an investment in that same business
venture, the recommendation should be accompanied by an indication
of the attorney’s interest in the matter. Any other course of
action is a breach of the fiducuary relationship between attorney
and client.
Failure to reveal the advisor’s personal interest may merit
severe sanctions. For example, a lawyer in Ohio was suspended
from the practice of law for having “falsely and fraudulently
counselled” the beneficiaries of an estate for which he was the
attorney.

The attorney had advised the beneficiaries to invest
in a corporation which intended to purchase a plant and lease it
back to the seller. However, he failed to disclose that he was the
sole owner of the purchasing corporation. The attorney also had
attempted to induce the investment by representing that he was
investing $20,000 of his own money, in addition to the $85,000
that the beneficiaries were investing, when in fact he was only
investing $5,000 in cash. Finally, the attorney did not inform the
beneficiaries that he would benefit by the depreciation deduction
which he could take against the entire property for income tax
purposes.

The seller-lessee went bankrupt four years later and
defaulted on its rental payments. The beneficiaries did not learn
of their lawyer-advisor’s self-interest in the investment until after
the investment failed. The lawyer argued that he should not
be penalized because the clients “knew where they were coming
out.”9 Nevertheless, the Supreme Court of Ohio ordered that the
7. EC 5-4.
8. Toledo Bar Ass’n v. Miller, 22 Ohio St. 2d 7, 257 N.E.2d 376 (1970).
9. Id. at 377.
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CONFLICT OF INTEREST AND THE LAWYER IN CIVIL PRACTICE
426 VALPARAISO UNIVERSITY LAW REVIEW [Vol. 10
lawyer be suspended from the practice of law for an indefinite
period, noting that:
[h] e had a lawyer’s professional obligation not to acquire
an interest adverse to his clients, not to represent conflicting
interests except with their consent, … and not
to accept employment as a lawyer without first disclosing
to these clients his relationship with any adverse
party and his interest in the subject matter of the employment.1
0
The fiduciary relationship is also strained when a client
wishes to confer a benefit on a lawyer. The lawyer should not
lose sight of the possible impression of wrong-doing in such cases.
The lawyer is a fiduciary, and “courts of equity will scrutinize
with jealous vigilance transactions between parties occupying
fiduciary relations toward each other.”‘” Perhaps the most recognized
example of such fiduciary duty is that of the attorney who is
to receive a benefit under a will should not draft the will. Courts
confronted with will contests have gone so far as to suggest that
a presumption of undue influence arises when the will is drafted
by an attorney-beneficiary:
Our courts have on occasion said that where a testator
wishes to name his attorney or a member of the attorney’s
family as a beneficiary, ordinary prudence requires that
the will be drawn by some other lawyer of the testator’s
choosing, and thus to avoid the suspicion of an abuse of
the confidential relationship.2
The same principle would seem to apply to inter vivos conveyances,
since an attorney simply cannot give the kind of independent advice
which a client should expect when the attorney’s own property
and personal interests are involved.
10. Id. at 379.
11. McFail v. Braden, 19 Ill. 2d 108, 117 N.E.2d 46, 52 (1960). The
Massachusetts Appellate Court, explaining this scrutiny, stated that the
attorney has the burden of showing that the transaction was in all respects
fair and equitable. The court required an attorney to return collateral to
a client when the collateral was much greater in value than the amount the
attorney had loaned the client. The fact that the attorney actually advised
the client that the loan arrangement was contrary to his financial interest
would not save the transaction. Goldman v. Kane, 329 N.E.2d 770 (Mass.
App. 1975).
12. In re Blake’s Will, 21 N.J. 50, 120 A.2d 745 (1956).
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9 CONFLICT OF INTEREST
However, the one area in which the Code condones a direct assertion
of the lawyer’s own self-interest against the client’s interest
is in collection of fees. Indeed, one of the few instances in
which an attorney can reveal a client’s confidence is when the
revelation is “necessary to establish or to collect” a fee. 3 Moreover,
the “retaining lien” of an attorney allows him to withhold
a client’s papers and documents until the fee is paid. While
such a lien is analogous to the mechanic’s or banker’s lien, the
lawyer has always rejected the “tradesman” image of those
businesses. Presumably the lien can be asserted even if it is harmful
to the client and prevents successor counsel from pursuing the
client’s case. Because of the questionable nature of the retaining
lien, not all states have recognized it.14
The very form of the fee arrangement may establish a conflict
of interest between the client and the attorney. For example,
while the Code of Professional Responsibility does not prohibit
contingency fees in divorce cases, 5 apparently a contingency fee
agreement based upon the amount of support ordered or upon the
property settlement places the attorney in an interested position,
conflicting with his duty to seek marital reconciliation whenever
possible. 6 This is probably one reason that Massachusetts lawyers
are prohibited by court rule from using a contingent fee agreement
“in respect of the procuring of a divorce, annulment of marriage
or legal separation.””‘ The policy behind this Massachusetts rule
was illustrated in Mclnerney v. Massasoit Greyhound Association,”8
in which the lawyer had a divorce client sign a contingent
fee agreement after “ten or fifteen minutes conversation,” one
month after she separated from her husband of ten years. The
court felt that the lawyer’s conduct manifested a desire to get
some of the client-wife’s property for himself.”
13. DR 4-101(c) (4).
14. The retaining lien differs from the judgment lien, under which
an attorney enjoys a lien on any judgment collected for his client to the extent
of the fee still due to him. This form of the attorney’s lien does not
have the same potential for conflict between the client’s and the attorney’s
interests as the retaining lien does.
15. DR 2-106(c) only prohibits the collection of “a contingent fee for
representing a defendant in a criminal case.”
16. Contingency fee agreements in divorce cases were recently held
to be “void as against public policy.” Aucoin v. Williams, 295 So. 2d 868
(La. 1974); Succession of George Butler, 294 So. 2d 512 (La. 1974).
17. SuP. JUD. CT. RULE 3:14(3).
18. 359 Mass. 339, 269 N.E.2d 211 (1971).
19. Id. at 351.
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Like divorce and property settlement matters, personal injury
fee arrangements may induce conflicts, but in such cases, the
contingent fee arrangement may be necessary. While a conflict
may not be so apparent in the personal injury situation, some
writers have noted that in fact, “the lawyer’s financial interest
lies in an early discounted settlement while the client’s interest
lies in waiting out the insurer.’2 Most personal injury lawyers
will spend more time on a clear liability-good damage tort case
than a case involving questionable liability issues and small damages.
However, that does not mean that contingency fee personal
injury suits are not handled to the best of each lawyer’s
ability; generally, both lawyer and client have an identical community
of interest in procuring the best possible settlement.
Furthermore, critics of the contingent fee agreement often forget
that from the client’s point of view, such an arrangement may be
the only method by which he can finance the payment of a lawyer
to handle a tort case. It is axiomatic that the victim of tortious
conduct, offered a choice between the contingent fee method of
compensating his lawyer and an hourly or per diem basis, will
inevitably choose the former rather than the latter. In truth, the
contingency system ensures that legal services are rendered to a
vast number of persons who would not otherwise receive them.
This identity of interest between the lawyer and the client must
be kept in mind in evaluating alleged conflicts of interest in the
use of contingent fee agreements.
When someone other than the client is the source of the fee,
the lawyer may feel a sense of responsibility to the person paying
the fee as well as to the client.2 ‘ That source may subject the
attorney to pressures adverse to the client’s interest. On the other
hand, the fact that a lawyer is merely being paid by a source
which is also paying the opposing counsel does not of itself create
a conflict of interest. In a New York case, 2
2 a public defender
refused to represent a party in a family court proceeding because
the county attorney was representing the opposing side in a child
protective proceeding. Although the public defender argued that
there was a conflict of interest since both he and the county
attorney were appointed by and paid by the county, the court
held that these facts alone did not create a conflict of interest.’
20. D. ROSENTHAL, LAWYER AND CLIENT: WHO’S IN CHARGE? (1974).
21. EC 5-22.
22. Owen v. Mogavero, 77 Misc. 2d 581, 355 N.Y.S.2d 90 (Sup. Ct.
Otsego County, 1974).
23. The source of the attorney’s fee may create a conflict where
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CONFLICT OF INTEREST
THE LAWYER IN OTHER ROLES
An attorney may frequently fulfill various non-lawyer functions,
outgrowths of his practice of law, which present possible
conflicts of interest. For example, attorneys may serve as guardians,
public office holders or executors of estates. In various
courtrooms, attorneys may be called on to serve as public defenders
or special judges. Perhaps the most familiar conflict
of interest situation is the lawyer who is also a potential witness
and must decide before or during trial whether his client’s interest
is best served by withdrawing from the case to testify or by remaining
as counsel in the action.
The Lawyer as Witness
A lawyer cannot testify to a matter in dispute between parties
in litigation and still fulfill his function as an advocate. The
Ethical Considerations of the Code of Professional Responsibility
remind: “[T]he role of an advocate is to advance or argue the
cause of another, while that of a witness is to state facts objectively.”
4 The lawyer-witness may be more easily impeached
as a witness when he also serves as counsel to the party for whom
he testifies. Because of this conflict, the rules of the Supreme
Judicial Court of Massachusetts flatly provide that “no attorney
shall be permitted to take part in the conduct of a trial in which
he has been or intends to be a witness for his client, except by
special leave of court.”25 Similarly, the Code of Professional Responsibility
prohibits a lawyer from accepting employment in
contemplated or pending litigation “if he knows or it is obvious
that he or another lawyer in his firm ought to be called as a
witness. 2 6
If, after accepting employment, a lawyer learns that he ought
to be called as a witness on behalf of his client in “contemplated
or pending litigation,” the Code provides that he should withdraw
as counsel. 7 If a lawyer learns only in the course of the trial
several attorneys work for a legal services organization. See Estep v. Johnson,
383 F. Supp. 1323 (D. Conn. 1974); Owen v. Mogavero, 77 Misc. 2d 581,
355 N.Y.S.2d 90 (Sup. Ct. Otsego County, 1974). For a discussion of this
potential conflict in criminal matters, see Allison, Relationship Between the
Office of Public Defender and the Assigned Counsel System, 10 VAL. U.L.
REv. – (1976).
24. EC 5-9.
25. SUP. JUD. CT. RuLE 2:24.
26. DR 5-101(B).
27. DR 5-102(A).
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that he ought to appear as a witness and his withdrawal from
the trial would prejudice the case of his client, good sense dictates
that the lawyer should be permitted to testify. If a lawyer learns
subsequent to employment that he or someone in his firm may
be called as a witness by the opposing side, he may continue to
represent his client unless he determines that such testimony will
be prejudicial to his client.2 8
The rule prohibiting an attorney from testifying is clearest
in cases in which a lawyer is a witness to any substantive
matter in dispute.2″ In such cases he must withdraw as counsel.
In an Illinois case,3° an Assistant Attorney General testified in a
Civil Service Commission discharge hearing in which he was also
counsel for the state. The plaintiff, a state safety inspector, had
testified that he had not visited specified plants for at least a
month before his discharge hearing. Despite the fact that he
represented the state in the hearing, the Assistant Attorney General
took the stand and was permitted to testify, solely in rebuttal,
that he had seen the plaintiff at one of the plants the day
before the hearing. In reviewing the Commission’s admission of
his testimony, the Illinois Court of Appeals stated:
We condemn the conduct of the Assistant Attorney General.
While acting as counsel for the Department of
Labor, a public body, he abandoned his role as advocate
and became a witness for the party he was representing
without withdrawing from the case. This practice of
acting as both advocate and witness has been consistently
frowned upon and discouraged by the legal professionin
the instant case, this conduct was totally unnecessary
and inexcusable.”
In certain exceptional circumstances, the Code permits a lawyer
to testify where the potential for conflict is de minimus 2 Thus,
an attorney’s testimony is allowed:
28. DR 5-102(B).
29. The fact that an attorney submitted an affidavit on jurisdictional
facts in dispute was held not to be grounds for disqualifying him as counsel,
if the same facts were supported by independent testimony. Ceramco, Inc. v.
Lee Pharmaceuticals, 510 F.2d 268 (2d Cir. 1975).
30. Lavin v. Civil Service Comm’n, 18 I1. App. 3d 982, 310 N.E.2d 858
(1974).
31. Id. at 865.
32. DR 5-101(B).
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(1) If the testimony will relate solely to an uncontested
matter.
(2) If the testimony will relate solely to a matter
of formality and there is no reason to believe that substantial
evidence will be offered in opposition to the
testimony.
(3) If the testimony will relate solely to the nature
and value of legal services rendered in the case by the
lawyer or his firm to the client.
(4) As to any matter, if refusal would work a substantial
hardship” on the client because of the distinctive
value of the lawyer or his firm as counsel in the
particular case.3

When a lawyer is in some doubt as to whether he would better fill
the role of witness or the role of advocate in a given case, “doubts
should be resolved in favor of the lawyer testifying and against
his becoming or continuing as an advocate. 35
The Lawyer as Administrator or Guardian
An attorney who holds office as a fiduciary, such as an executor,
administrator or guardian ad litem, may encounter conflicts
of interest. Although there appears to be little case law
relating to the subject, an attorney-administrator or attorneyexecutor
may be in a potential conflict of interest situation if
33. An example of a “substantial hardship,” is found in Los ANGELES
BAR AsSOCIATION LEGAL ETHICS COMMITTEE OPINIONS, No. 312 (196D), which
permits the lawyer to continue in the case when his partner is a witness
and the following conditions are met:
(1) the partners represented the client previously to the litigation,
(2) the testimony supports the client’s position,
(3) the lawyers have intimate knowledge of the details of the
litigation which would cause substantial prejudice to the client
if he were not represented by them,
(4) the court and opposing counsel are informed that the partner
will be a witness.
A recent opinion of the Massachusetts Bar Association Committee, No. 76-2,
suggests that when the pending case is an unusually complex matter such
as a patent infringement case involving sophisticated technical matters or
a complex anti-trust case, “the expense and inefficiency of having a new
lawyer become familiar with the case would come within the substantial
hardship exception of DR 5-101(B) (4).”
34. DR 5-101(B).
35. EC 5-10.
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he is also the attorney for the estate.3 6 This common practice
probably does not result in any direct conflict in the majority of
cases, but retention of an independent attorney for the estate
might serve to deter the larcenous tendencies of a given administrator.
Clearly there is no such check when the same person
acts as both attorney and administrator.
In a recent Ohio case,3
” an attorney was disbarred for serving
as guardian of an incompetent person who held a note payable
by another client of the same attorney. While he was
guardian, he cancelled the note. The court rejected the attorney’s
argument that “as guardian he was not acting as an attorney.”3
Recognizing this potential conflict in other situations, the Committee
on Professional Responsibility has held that an attorney
serving on the board of directors of a bank and/or counsel for
the bank cannot act to foreclose a mortgage of property held
by an estate for which he is executor.3 9
The hydra-headed role of a guardian ad litem may itself
create a potential conflict of interest for an attorney appointed
to that position. For example, under Massachusetts practice, a
person appointed as guardian is expected to advise the court of
the circumstances of his ward. While the guardian’s report has
“no authoritative standing as establishing the facts in the case,”‘ 0
it is expected to give an added dimension to assist the court.
However, the guardian-attorney is also expected to advance the
best interests of his client, which may require him to assume a
strong adversary position in a case. Is it possible for the same
person to be both an advisor to the court and a vigorous advocate
for his client?
The dilemma of the lawyer-guardian is poignantly illustrated
in cases in which a guardian ad litem is appointed to represent
a minor donor in bone marrow transplant or kidney transplant
cases.” In these cases, the hospital and operating physicians sue
36. According to ABA COMM. ON PROFESSIONAL ETHICS, INFORMAL
OPINIONS, No. 836 (1965), there is no impropriety per se in allowing a
guardian of person or property to perform legal services for the benefit of
that person or property.
37. Toledo Bar Ass’n v. Bartlett, 39 Ohio St. 2d 100, 313 N.E.2d 834
(1974).
38. Id. at 838.
89. ABA COMM. ON PROFESSIONAL ETHICS, INFORMAL OPINIONS, No.
930 (1966) [hereinafter cited as ABA OPINIONS].
40. Young v. Tudor, 323 Mass. 508, 83 N.E.2d 1 (1948).
41. These cases are unreported proceedings before a single justice
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for a declaratory judgment against the donor, seeking immunity
from liability for non-negligent torts. Since the minor ward
wants to make the tissue donation to save the life of a relative,
the attorney as guardian is under strong pressure to consent.
On the other hand, the operation creates some substantial risks
for the donor without medical benefits to him, a situation which
causes some lawyers to object to hospital and doctor immunity.
Should the guardian then oppose the operation when the net
effect of the operation would be to threaten the life of his ward’s
donee? The basic dilemma of the lawyer-guardian in these cases
is whether or not he sees this declaratory judgment proceeding
as truly adversary.
The Lawyer as Public Official
A lawyer serving as a public official is required to avoid a
conflict between the duty he owes to the public and his own interest
or that of a client. The Code of Professional Responsibility is
explicit on this point:
A lawyer who holds public office shall not:
(1) Use his public position to obtain, or attempt to obtain,
a special advantage in legislative matters for
himself or for a client under circumstances where
he knows or it is obvious that such action is not
in the public interest.
(2) Use his public position to influence, or attempt to
influence, a tribunal to act in favor of himself or
of a client.
(3) Accept anything of value from any person when
the lawyer knows or it is obvious that the offer
of the Supreme Judicial Court. See generally Nathan v. Meekins, No. 74-109-
Equity (July 14, 1974); Camitta v. O’Mealia, No. 73-86-Equity (April 25,
1973); Nathan v. Clark, No. 73-71-Equity (April 12, 1973); Kennedy v.
Nathan, 72-136-Equity (October 3, 1972); DeCaro v. Klein, No. 72-88-Equity
(July 18, 1972); Huckey v. Harison, No. 68-674-Equity (November 20,
1957); Masden v. Haarison, No. 68-651-Equity (June 12, 1957). In Nathan
v. Farinelli, No. 74-87-Equity (July 3, 1974), the guardian-lawyer expressly
opposed the transplant and attempted to file a cross claim. He successfully
sought to compel the purchase of insurance for non-negligent injury, an order
which was later modified. In Nathan v. Cruz, No. 75-96-Civ. (April 17,
1975), the guardian filed a motion to dismiss for want of jurisdiction; the
action was dismissed, and the donee child later died.
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CONFLICT OF INTEREST AND THE LAWYER IN CIVIL PRACTICE
is for the purpose of influencing his action as a
public official.42
Even after a lawyer has left public office, he may not use the
office for his own self-interest, such as by stating this former position
on a business card or letterhead.”3 The former public official
cannot ethically represent a private client in any matter in which
he previously participated as a public employee. Thus, a former
deputy city attorney may not defend a client against alleged zoning
violations partly investigated by him while he was employed
by the city.4
Lawyers in public positions should be aware of another
conflict of interest dimension. The lawyer as a public official
is frequently limited in what he can do, not only by the Code of
Professional Responsibility, but also by public-interest conflict
rules. The federal government has adopted statutory conflict of
interest rules, 5 as have some states. 6
Thus, we have seen the problems which may be presented
when an attorney has a self-interest which conflicts with that
of his client. Likewise, an attorney serving as executor, guardian,
or office holder must be alert to potential conflicts. The ethical
and practical dilemma which arises in conflict of interest situations
is most clearly seen in civil litigation.
CIviL LITIGATION
The Code of Professional Responsibility states that a lawyer
should not accept employment, or should withdraw from employ42.
DR 8-101. The fear of such a conflict is also the reason for prohibiting
assistant district attorneys from having private criminal law
practices. ABA OPINIONS, No. 922 (1966).
43. DR 2-102. In State v. Schumacher, 210 Kan. 377, 502 P.2d 748
(1972), an attorney was suspended from practice for six months for
printing “Former Workmen’s Compensation Commissioner” on his letterhead.
However, a lawyer who is starting a new professional association may
mail to lawyers, clients, former clients, personal friends and relations a
brief announcement card which states “the immediate past position of the
lawyer.” DC 2-102(A) (2). He may not place such an announcement in a
local newspaper. See MASS. BAR ASS’N ETHICAL OPINIONS, No. 75-3.
44. ABA OPINIONS, No. 647 (1963).
45. 18 U.S.C. §§ 201-18 (1969).
46. See, e.g., MASS. GEN. LAWS ch. 268A (1970); N.Y. EXEC. LAW
§ 63(11) (McKinney 1972); WASH. Rsv. CODE ANN. § 42.22.010-.070 (1972).
For a discussion of the Illinois law, see Spak and Parent, Conflict of Interest,
52 CHI.-KENT L. REV. 64 (1975).
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CONFLICT OF INTEREST
ment, “if it would be likely to involve him in representing differing
interests.”” Obviously an attorney cannot represent both the
plaintiff and the defendant in the same case ;”5 yet, other situations
in which such “differing interests” arise may not be so clear.
These differing interests described in the Code which would disqualify
a lawyer may be “conflicting, inconsistent, diverse, or
otherwise discordant,”” Thus, an attorney cannot represent both
the lender and the borrower,”0 the mortgagor and the mortgagee,’
the vendor and vendee, 2 or the insurer and the insured. 3
As a result of the expanding use of complex, multi-party
litigation in this country, civil attorneys are increasingly faced
with potential conflicts of interest which until recently arose
mainly in a criminal setting. It has become apparent that the
interests of multiple plaintiffs or defendants may be adverse in
the civil context. For example, in a tort case where one lawyer
represents several plaintiffs, he may not make an aggregate settlement
of their claims unless each client consents to the aggregate
settlement after being informed of the existence, nature and
amount of all the claims being settled. ”
A lawyer asked to represent various parties should carefully
examine whether there is a totality of interest among the parties
he represents. In the dissenting opinion of a recent federal case,
a lawyer was criticized for not showing the “slightest concern
for the welfare of the minor plaintiff””5 when he represented
both an anonymous minor and an abortion clinic which sought to
have a portion of the Massachusetts abortion statute 6 declared unconstitutional.
The majority of the court was also criticized for
not appointing a guardian ad litem for the minor when it became
clear that there was not a totality of interest among the various
plaintiffs who were all represented by one lawyer.”‘
47. DR 5-105(A) (B).
48. Crowley v. O’Connell, 174 Mass. 253, 54 N.E. 558 (1899).
49. EC 5-14.
50. Matter of Greenberg, 21 N.J. 213, 121 A.2d 520 (1955).
51. ABA OPINIONS, No. 643 (1963).
52. Matter of Hall, 73 Wash. 2d 406, 438 P.2d 874 (1968).
53. Kelly v. Greason, 23 N.Y.2d 638, 244 N.E.2d 456 (1969).
54. DC 5-106.
55. Baird v. Bellotti, 393 F. Supp. 847, 859 (D. Mass. 1975) (Julian, J.,
dissenting), vacated – U.S. – , 96 S. Ct. 2857 (1976).
56. MASS. GEN. LAWS ch. 112, § P (1971).
57. Judge Julian wrote in his dissenting opinion:
The record shows that his sole objective was to have the statute
declared unconstitutional for the benefit of the adult and corporate
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Several themes are repeated in many conflicting interest
cases: the potential for abuse of confidences, inability of counsel
to serve each of his clients fully, and the need to preserve the
profession from the appearance of impropriety. Each of these
is of concern to courts and to the bar. One series of cases may
be used to show how conflicts of interest may develop and why
they may not be tolerated.
United Mine Workers Cases
In addition to illustrating the reasons for barring conflicts of
interest, the series of United Mine Workers cases is also the classic
example of how complex conflicts cases can be. The UMW cases
show that an attorney’s conflict of interest may develop during
a civil suit even when the attorney-client relationship arose in a
different matter.5″
In Yablonski v. United Mine Workers of America,”‘ the court
held that a well-known Washington law firm had to disqualify itself
as counsel for the union in an action brought by dissident
union members for an accounting and restitution of funds allegedly
misappropriated and misspent.6
” The dissidents joined
as defendants certain officers of the union who were allegedly
responsible for the misuse of funds. The law firm was regularly
outside counsel for the union. During the first six months after
the complaint was filed, the law firm represented both the union
and the defendant officers. The firm then withdrew as counsel for
the individual defendant officers but continued to represent the
union. The plaintiffs filed a motion to disqualify the law firm
from continued representation of the union as well, because it
had represented the officers of the union in other litigation; this
plaintiffs . . . . The court should have appointed a guardian ad
litem for the minor plaintiff to insure representation of her interests.
Baird, 393 F. Supp. at 859.
58. Another example of a conflict of interest in one suit arising from
a relationship in another suit is found in Kansas v. Kopke, 210 Kan. 330,
502 P.2d 813 (1972), in which an attorney represented a client in a personal
injury suit. At the same time, he represented the client’s employer in an
independent workman’s compensation claim in which the client proceeded
pro se. While the client did not complain about this situation, the court found
a conflict of interest. The lawyer should have withdrawn from the workman’s
compensation case or insisted that the client obtain independent legal
counsel.
59. 448 F.2d 1175 (D.C. Cir. 1971).
60. The action was brought under the Labor-Management Reporting
and Disclosure Act, 29 U.S.C. § 501(b) (1975).
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allegedly brought the firm into conflict with its representation
of the union in the present litigation. On appeal from the district
court’s pretrial denial of plaintiff’s motion, the United States
Court of Appeals for the District of Columbia Circuit ordered
disqualification of the law firm.’
The court noted that the law firm was representing the
defendant officers individually in four other separate cases pending
between the plaintiffs and the officers. Since the interests of
the individual officers and the union may have been both distinct
and adverse in these other cases, the ability of the law firm to
give total fidelity to the union in the instant case was in doubt:
It is undeniable that the regular U.M.W.A. Counsel have
undertaken the representation of Boyle individually in
many facets of his activities as a U.M.W.A. official, as a
trustee of the Fund, as a Director of the Bank owned
74% by the union. With strict fidelity to this client, such
counsel could not undertake action on behalf of another
client which would undermine his position personally.
Yet in this particular litigation, counsel for the U.M.W.A.
should be diligent in analyzing objectively the true interests
of the U.M.W.A. as an institution without being
hindered by allegiance to any individual concerned.-
Even if we assume the accuracy of the appellee’s position,
at the present time there is no visible conflict
of interest, yet we cannot be sure that such will not arise
in the future.-The public interest requires that the
validity of appellant’s charges against the U.M.W.A.
management of breach of its fiduciary responsibility be
determined in a context which is as free as possible from
the appearance of any potential for conflict of interest in
the representation of the union itself.62
After remand to the district court for trial, the union’s General
Counsel entered its appearance for the union. Plaintiff again
moved to disqualify the defendan ‘s attorney. The district court
denied this motion, and again an appeal was taken to the circuit
61. The court rejected the argument that the firm should be disqualified
because it had represented both the union and the individual
officer-defendants for the first six months of the litigation. The court
noted that representation of both for six months was “an effort to ascertain
the exact nature of the lawsuit and protect the interest of all the defendants.”
448 F.2d at 1177.
62. 448 F.2d at 1179-80.
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court. Once again the Court of Appeals for the District of Columbia
Circuit reversed the district court-ordered disqualification of
the union’s General Counsel on grounds of his close association
with the individual defendant officers and his representation of
such officers in other litigation. 3
The UMW case had a bizarre ending: plaintiffs subsequently
were elected to positions of power in the union. The union was
realigned as party-plaintiff to the suit. The new union leadership
then moved for leave to have its General and Associate Counsel
represent the union in the litigation. While its action might seem
inconsistent with the prior proceedings, the District of Columbia
Circuit ruled that the General and Associate Counsel could now
represent the union, although those same lawyers formerly represented
the individual plaintiffs who initiated the suit. After
the union shake-up, the court found that the interests of the new
individual officers were not antagonistic to the interests of the
union; therefore, representation was permitted.”
Other Civil Conflicts
An attorney may himself become plaintiff in a civil action.
Of course, he enjoys the rights of any litigant to represent himself.
But may he represent himself as plaintiff while also representing
other plaintiffs? While this situation is not prohibited per se,
it holds such a great potential for conflict of interest that “the
lawyer would be well advised not to undertake such representation.
65
In domestic relations cases, a conflict of interest exists if
an attorney represents both husband and wife. Parties may agree
on a divorce, on terms of separate support, property, and child
custody, yet their interests will remain adverse. This would
clearly preclude one lawyer advising both husband and wife.
Since both husband and wife may have an existing relationship
with one lawyer, the attorney must be careful when his advice is
63. Yablonski v. United Mine Workers of America, 454 F.2d 1036
(D.C. Cir. 1971), cert. denied, 406 U.S. 906 (1972).
64. Weaver v. United Mine Workers of America, 492 F.2d 580 (D.C.
Cir. 1973). The extensive litigation over the issue of representation apparently
produced unusual bitterness between counsel. Charges of unethical
conduct, subornation of perjury, brides to witnesses, as well as conflicts of
interest have found their way into print. See, e.g., Gillers, Joe Rauh: An
Integrated Life, JuRIS DOCTOR, Feb. 1975, at 36; Rauh v. Williams, JURIS
DOCTOR, May 1975, at 6.
65. ABA OPINIONS, No. 899 (1965).
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sought on a domestic dispute. One ethical opinion has stated that
an attorney who represented a married couple in an adoption
proceeding may later represent the wife in a divorce action against
the husband, but must disqualify himself if, in the course of the
adoption case, he learned any confidential information which
would be advantageous to the wife in the divorce.”
In an Ohio case, 7 an attorney was censured by the state’s
supreme court because he allowed himself to drift into dual representation
of husband and wife. While he was representing the
husband in a personal injury action, the husband and wife agreed
to the terms of a separation and requested the attorney to draft it.
This agreement provided that the wife was to receive one-third
of any settlement of the tort case. The attorney then filed a
divorce petition for the wife. At the uncontested divorce hearing,
the attorney, representing the wife, asked the court to incorporate
into the decree the terms of the previously drawn separation agreement.
Even though the tort case was subsequently settled, the
attorney refused to communicate the amount of the settlement to
the wife; rather, he paid the proceeds directly to the husband.
While there was never any direct understanding between the wife
and the attorney that he would protect her interests in the tort settlement,
the Supreme Court of Ohio nevertheless felt that the
attorney acted improperly: “Too many experienced lawyers have
accepted such employment for separation or divorce matters under
said circumstances, only to ultimately abandon the interest of
one or the other of their clients.” 8
Derivative suits in corporate practice provide another example
of the complexities of conflicts of interest hidden below the
surface of civil litigation. Since a corporation is a legal person
with an identity separate from both stockholders and officers, an
attorney in a professional relationship with stockholders or officers
must concern himself with potential conflicts between his
duty to the corporation and his duty to these individuals. Whether
the attorney is corporate counsel, or outside counsel commonly retained
to represent corporate interests, he will find the stockholder
derivative suit to be a source of conflict if he undertakes
to represent or advise any individual defendant-officer. The very
thrust of such a suit is to assert the interests of the corporation
66. MASS. BAR ASS’N ETHICAL OPINIONS, No. 76-12 (1976).
67. Columbus Bar Ass’n v. Grelle, 14 Ohio St. 2d 208, 237 N.E.2d 298
(1968).
68. Id. at 300.
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against the allegedly wrongdoing officer. Even though the corporation
is a nominal defendant, it is clear that the corporate entity
has interests both different and potentially adverse to those of
the individual defendants in the suit. The most that corporate
counsel can do in such cases is to urge the individual defendants
to seek separate legal counsel; he should never undertake to
represent them. The mere fact that the individual defendants, if
successful, may seek reimbursement from corporation assets does
not mean that they are entitled to have corporate counsel represent
them.
CONFLICTS AS A RESULT OF SUBSEQUENT PLEADING
Sometimes no conflict of interest exists between an attorney
and a party at the outset of a suit, but as a result of some subsequent
pleading, a conflict arises. A counterclaim or cross claim
filed pursuant to FED. R. CIV. P. 13 or the addition of a thirdparty
defendant under FED. R. Civ. P. 14 may create a previously
unexpected conflict of interest for counsel, since parties are then
realigned.
An attorney found himself in such a dilemma in Jedwabny v.
Philadelphia Transportation Company,” a case arising out of a
collision between an automobile and a streetcar. The ownerdriver
of the motor vehicle and two of his guest passengers
brought suit against the streetcar company for injuries sustained
in the collision. All three plaintiffs were represented by a single
attorney. Subsequently the streetcar company joined the ownerdriver
as a third-party defendant on a theory that his negligence
was the cause of the collision. Thus, when the case was called for
trial, one attorney was representing three plaintiffs and the thirdparty
defendant. The jury returned a verdict for the plaintiffguests
against the defendant-streetcar company and third-party
defendant owner-driver. The trial judge consequently ordered
a new trial on the grounds that he had failed to properly advise the
third-party defendant of his right to have independent counsel
represent him as third-party defendant, and had failed to make
certain that the third-party defendant knew the ramifications of
his attorney’s conflict of interest. The Supreme Court of Pennsylvania
affirmed the order for a new trial:
No one could conscionably contend that the same attorney
may represent both the plaintiff and defendant
69. 390 Pa. 231, 135 A.2d 252 (1957).
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in an adversary action. Yet that is what is being done
in this case. It was the attorney’s duty to protect the
$10,500 verdict of his plaintiff client against the additional
defendant while it was his duty at the same time
to relieve from liability the additional defendant whose
representation the attorney had orginally undertaken
for the purpose of obtaining for him a recovery from the
transportation company. Obviously the attorney cannot
serve the opposed interests of his two clients fully and
faithfully. The ancient rule against one’s attempting
to serve two masters interposes.”0
The emphasis in Jedwabny was on the need for the client to
make an intelligent waiver of his rights in this conflict of interest
situation. Under the Code of Professional Responsibility the lawyer
must not only obtain consent in such a situation but it must
be “obvious that he can adequately represent the interest of
each.”” Since it is impossible to adequately represent both the
plaintiff and defendant, it would seem that under modern rules
even the informed consent of the client in such circumstances
would not be adequate to enable the same counsel to represent
the plaintiff and a third-party defendant. Indeed, in Jedwabny
the court even rejected the argument of the third-party defendant
that he did not want a new trial.
In Jedwabny, the strong dissent by Justices Bell and Musmanno
of the Pennsylvania Supreme Court seems to call for a
“common sense” solution to third-party defendant problems of
this kind. Justice Musmanno saw no conflict of interest because
all plaintiffs and the third-party defendant took the same position
-that only the streetcar company was responsible for the accident.
Musmanno pointed out that only the streetcar company,
not the losing third-party defendant, profited from the order of
a new trial. Indeed, as a result of the court’s reversal, the thirdparty
defendant could find himself being held jointly liable with
the streetcar company, or even singly liable, for a larger amount
of damages. The dissenters questioned further whether the court
should try to protect the client from his own best interest merely
because of a theoretical conflict of interest on the part of his
lawyer. Justice Bell used the following example to show how the
majority decision could be reduced to an absurdity:
70. Id. at 254.
71. DR 5-105(c).
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For example, a poor man owns and is a passenger
in an automobile which is driven by his wife. There is
some evidence that it was being driven under his direction
although he denies this. A collision occurs with another
automobile owned and driven under the same circumstances.
Each family engages a lawyer and each is
convinced that the other driver is solely at fault. Cross
suits are brought and each plaintiff is joined as a defendant
in each suit. The suits are tried together and each
lawyer explains to his client the legal risks and possibilities.
Each family tells their attorney that they cannot
afford to employ more than one lawyer. Why should
the law or any canon compel each claimant to employ
two lawyers–a total of six or eight lawyers in this
simple case? Isn’t such a requirement impractical, unjust
and ridiculous? 2
Even though the majority in Jedwabny may have been technically
correct in pointing out the need for full disclosure of
possible conflicts, the dissenters make clear how ridiculous such
an approach can be. A better approach to solving conflicts problems
might be to determine whether any purposes of the rule
against conflicts of interest, such as keeping communications
privileged, are in fact aided.
POTENTIAL ABUSE OF PRIVILEGE
One of the main reasons for avoiding attorney conflicts of
interest is to prevent the potential abuse of privileged communications.
Under DR 4-101 (B) (2) and (3) of the ‘Code of Professional
Responsibility, an attorney may not use a confidence
of his client “to the disadvantage of the client” or “for the advantage
of a third person.” 3 A lawyer may find it difficult to
maintain a client’s confidences in several situations. Changes of
parties during the course of an action may create a privilege
dilemma, as may the appearance of another client of the attorney
as witness for the opposing party. Association with a law
72. 135 A.2d at 255.
73. For the text of an extensive proposed amendment to the Code of
Professional Responsibility which would require withdrawal from a case for
conflicts of interest largely related to the attorney-client privilege, see
Comment, Attorney’s Conflict of Interests, 55 B.U.L. REv. 61, 84 (1975). It
is doubtful that such detailed rules are needed, since the infinite variety of
conflict situations are best met by a few simple rules which allow non-rigid
solutions to complex problems.
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firm which represents an opposing party also raises the issue
of abuse of confidences.
A change of a client’s loyalties during litigation puts an
attorney representing multiple parties in a dilemma. In Universal
Athletic Sales Co. v. American Gym Recreational and Athletic
Equipment Corp., Inc.,”‘ an attorney represented both the defendant
corporation and the defendant president of the corporation
in a patent infringement action. After the suit was filed, the
president of the corporation was dismissed from his position
and decided to cooperate with the plaintiff. The attorney withdrew
as counsel to the former president. Subsequently, plaintiffs
moved to disqualify the attorney for the corporation. They
argued that in undertaking to represent both the corporation
and the individual officer, the attorney learned things of a
confidential nature which enhanced the defendant’s position
and brought the attorney into conflict of interest with a former
client to the plaintiff’s disadvantage. The court rejected this
argument, finding that no confidential information was in fact
learned as a result of the former representation. 5 The court
warned, however, that if in the future a problem of privileged
communications arose which would be used to the detriment of
the former president, the court might disqualify corporate
counsel.” i
The appearance of a client as a witness for the opposing
party also creates a privilege dilemma for the attorney. In a
New York case,”‘ the plaintiff’s principal witness stated during
cross-examination that the defendant’s attorney was also his
lawyer. In that bench trial, the court immediately recessed the
proceedings and held a hearing on whether it was necessary
to disqualify defendant’s lawyer for conflict of interest. The
defense attorney argued against disqualification on the ground
that the defendant and witness had consented to the arrangement.
The court rejected this argument, however, noting that
under the Code of Professional Responsibility the consent exception
is not viable where there is a direct clash of conflicting
interests.’
74. 357 F. Supp. 905 (W.D. Pa. 1973).
75. Id. at 907.
76. Id. at 908.
77. In re Estate of Trench, 76 Misc. 2d 180, 349 N.Y.S.2d 265 (1973).
78. DR 5-105(A) and (B) absolutely prohibit a lawyer from representing
conflicting interests. Under DR 5-105(C), the client can consent to a
lawyer representing conflicting interests only if he can “adequately represent
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In examining the facts, the court determined that the defense
attorney was unable to represent both interests of the defendant
and the witness, since the witness’s testimony on cross-examination
might have implicated him in a crime. While no party had
moved to disqualify the defendant’s attorney for conflict of
interest, the court felt that it had to do so on its own motion in
order to maintain public confidence in the legal profession.
There is a strong policy against an attorney appearing in
a position adverse to that of even a former client. If an attorney
who finds himself in an adverse position to a former client possesses
confidential information, learned in representing the
former client, which is advantageous to his present client in the
civil litigation, the attorney should withdraw. If he does not
withdraw, the former client may move to have him disqualified
on the grounds that he had access to client confidences which
might prove useful in his present adversary position. This policy
is so guarded that on occasion courts have reversed judgments
solely because of the conflict.7
” The rule was laid down in P.C.
Theater Corporation v. Warner Brothers:8″
The former client need show no more than the matters
embraced within the pending suit wherein his former
attorney appears on behalf of his adversary are substantially
related to the matters or cause of action wherein
the attorney previously represented him–only in this
manner can the lawyer’s duty of absolute fidelity be
enforced in the spirit of the rule relating to policed
communications be maintained.8′
Some courts have gone so far as to suggest that if the current
civil litigation is substantially related to the previous representation,
then an “irrebuttable presumption” of imputed knowledge
of confidences arises, and the attorney must be disqualified.8 2
The more difficult case arises when an attorney once worked
for a firm which represented his present adversary and may
have had access to confidential information useful in the present
the interests of each” and only after “full disclosure of the possible effect of
such representation.”
79. United States v. Bishop, 90 F.2d 65 (6th Cir. 1937).
80. 113 F. Supp. 263 (S.D.N.Y. 1953).
81. Id. at 268-69.
82. Emle Indus., Inc. v. Patentex, Inc., 478 F.2d 562 (2d Cir. 1973);
Fleisatr v. A.A.P., 163 F. Supp. 548 (S.D.N.Y. 1958).
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litigation. In a Second Circuit case,83 a lawyer was disqualified
when the court imputed knowledge of confidences to him because
he was once a salaried clerk in a law firm which had represented
his present opponent in similar litigation. This rule would seem
particularly applicable when the subject matter of the present
litigation involves closely held trade secrets. But it would not
apply merely because a lawyer once worked for a firm that
represented a present opponent in any capacity.
In another federal case,” the court refused to disqualify a
lawyer who once had worked for a major law firm which represented
Chrysler Motors. While associated with the firm, the
attorney had handled some small real estate matters involving
property owned by Chrysler Motors. Several years later he represented
a franchise of Chrysler Motors in a restitution action in
which his client claimed that Chrysler Motors had used unfair
business practices to get him to sign a lease. The court indicated
that there was no reasonable relationship between the subject
matter of the present litigation and the prior representation which
would preclude the attorney from participating. It stressed that
the decision to disqualify a lawyer for conflict of interest in such
circumstances turns on whether, “in the course of the former representation,
the associate acquired information reasonably related
to the particular subject matter of the subsequent litigation.”85
The court added that if all lawyers were disqualified in such
circumstances, “young lawyers will necessarily become overcommitted
to their initial employer.”‘”
Personal relationships, as well as business relationships,
also raise the issue of potential abuse of confidences. Lawyers
have traditionally recognized that certain personal relationships
create problems which are best avoided if possible. It was widely
recognized as appropriate that Associate Justice Tom Clark
of the United States Supreme Court retire from the court when
his son, Ramsey Clark, was nominated by President Johnson
to serve as the Attorney General of the United States. The
Canons of Judicial Ethics require a judge to disqualify himself
if the judge’s spouse, or a person (or his spouse) within the third
degree of relationship to either of them, acts as a lawyer in the pro83.
Consolidated Theaters v. Warner Bros., 261 F.2d 920 (2d Cir. 1954).
84. Silver Chrysler-Plymouth, Inc. v. Chrysler Motors, Inc., 370 F. Supp.
581 (E.D.N.Y. 1973), aff’d, 518 F.2d 751 (2d Cir. 1975).
85. 370 F. Supp. at 586-87.
86. Id. at 589.
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ceeding.8 While this rule is not per se binding on non-judges, it
provides a good standard. Similarly, an attorney who represents
a judge should not appear before that judge or accept appointments
from him,88 and a defense lawyer should not employ in a
confidential capacity the spouse of a police detective.” Such employment
would not be consistent with a lawyer’s duty to take
reasonable care to protect the confidences of his clients.”
A situation not very common in the past, involving husband
and wife lawyers, promises to appear more frequently in the
future. When husband and wife are not practicing together,
there does not seem to be any direct prohibition against their
representation of adverse interests. Of course, since laymen
may in some cases question the propriety of representing opposing
parties, lawyers should try to avoid that situation. Unlike adversaries
who are mere friends or relatives, husband and wife
have their own confidential relationship and thus must be careful
to avoid inadvertent breach of a confidence. Client calls
or messages left at an attorney’s home only aggravate the danger.
In addition, the financial interest involved in winning or losing
a case in such circumstances should cause husband and wife
attorneys to question seriously their positions under DR 5-101,
which prohibits an attorney from accepting employment if his
own financial interests may be affected by such employment.9 ‘
REMEDIES FOR CONFLICTS OF INTEREST
Various solutions exist for an attorney when he is in a
conflict of interest situation. The lawyer’s sense of duty and his
ethics should prompt him to avoid conflict situations or to withdraw
when such a situation develops. Courts may disqualify an
attorney from appearing in conflicting roles or may refuse to enforce
the attorney’s fees against an aggrieved client. Perhaps the
strongest judicial remedy is reversal of a case tainted by a conflict
of interest. None of these severe remedies are necessary,
however, if an attorney follows his ethical duty.
87. ABA CANONS OF PROFESSIONAL ETHICS No. 3C (1) (d) (ii).
88. The Supreme Judicial Court of Massachusetts has termed “highly
improper” the conduct of two attorneys who rendered private legal services
to a judge without fee, while appearing before the judge in private cases
and in court appointments to represent indigent criminal defendants In re
Troy, 306 N.E.2d 203, 224 (Mass. 1973).
89. ABA OPINIONS, No. 692 (1964).
90. See DR 4-10(D).
91. ABA OPINIONS, No. 340 (1975). See 61 A.B.A.J. 1542 (1975).
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The Code of Professional Responsibility provides guidelines
for the attorney when a conflict of interest develops. The Code expressly
requires that a lawyer refuse employment when his personal
interests conflict with those of the client;2 it also sets
guidelines when he becomes a witness in a case.”3 Under the
Code, an attorney must avoid acquiring interest in litigation and
must limit business relationships with his client. A lawyer has an
affirmative duty to refuse to accept or to continue employment if
the interests of another client may impair his independent professional
judgment.9 4 The Code also requires a lawyer to avoid influence
by others that would adversely affect the client.9 5
The rules of the Code concerning the preservation of attorneyclient
confidences,” if carefully followed, will also eliminate some
conflict of interest problems.9 7 Once he has accepted employment
and a prohibited conflict arises, the attorney is required by the
Code to seek leave to withdraw from the matter.9 8 If he declines
employment or withdraws as required by the Code, his partners
or associates are also disqualified from the case.99 These rules of
the Code are enforceable in proceedings before the disciplinary
board or commission of the state bar.’ °0 Violations can result in
disbarment, suspension or censure by the court.’0 ‘
92. DR 5-101.
93. DR 5-102.
94. DR 5-103, 5-104.
95. DR 5-105.
96. DR 5-107.
97. DR 4-101.
98. DR 2-110, titled “Mandatory Withdrawal,” requires the lawyer to
withdraw if “he knows or it is obvious that his continued employment will
result in the violation of a Disciplinary Rule.”
99. DR 5-105.
100. See, e.g., MASS. Sup. JUD. CT. RULE 4:01. Section 3 of Rule 4:01
provides that:
each act or omission by an attorney . .. which violates any of the
Canons of Ethics and Disciplinary Rules . . . shall constitute misconduct
and shall be grounds for appropriate discipline.
Section 5 creates the Board of Bar Overseers and gives it jurisdiction over
the investigation of lawyers, with power to make recommendations to the
court regarding discipline.
101. The following cases provide example of attorneys being disciplined
for violation of conflict of interest rules: Lavin v. Civil Service Comm’n, 18
Ill. App. 3d 982, 310 N.E.2d 858 (1974) (attorney’s conduct condemned by
court in judicial opinion on the merits of the case); Kansas v. Kopke, 210
Kan. 330, 502 P.2d 813 (1972) (attorney censured); Cowley v. O’Connell,
174 Mass. 253, 54 N.E. 558 (1899) (attorney disbarred for representing
both plaintiff and defendants in actions which involved the same issue);
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An attorney whose conduct in a conflict of interest situation
is grossly improper may be deprived of other offices he holds. A
Massachusetts judge was enjoined from sitting for several reasons,
including his act of appointing his own private attorney, whom
he did not pay, to defend indigent criminal defendants. ‘ 2 The
Supreme Judicial Court of Massachusetts also removed an elected
district attorney from office because of his conflict of interest
with a charitable trust for which he was trustee.1 0 3
Another remedy arises from the power of the court to disqualify
an attorney from appearing in a representative capacity
which involves a conflict of interest.’0 4 Although the motion to
disqualify normally is made by the opposing party, the court has
the power to disqualify counsel on its own motion’ 5 if the administration
of justice requires. Courts, however, are reluctant to
disqualify a lawyer, since clients are then deprived of the services
of the attorney of their choice; for this same reason, a party
should not be permitted to disqualify the opposing attorney unless
he is able to show real prejudice.’ 6
Prejudice can be shown if the party now represented by the
attorney gains some undue advantage because of a potential conflict
of interest between a former client and the attorney,’ 7 espeToledo
Bar Assn. v. Miller, 22 Ohio St. 2d 7, 257 N.E.2d 376 (1970) (attorney
suspended from practice for one year); Columbus Bar Ass’n v.
Grelle, 14 Ohio St. 2d 208, 237 N.E.2d 298 (1968) (attorney censured);
Matter of Hall, 73 Wash. 2d 401, 438 P.2d 874 (1968) (attorney disbarred
for failure to reveal a conflict of interest and for breach of trust).
102. In re Troy, 364 Mass. 15, 306 N.E.2d 203 (1973).
103. Attorney General v. Flynn, 331 Mass. 413, 120 N.E.2d 296 (1954).
The District Attorney, acting as trustee of a testamentary charitable trust,
had sold trust land to himself through a strawman. The court ordered his
removal under MASS. GEN. LAW ch. 211, § 4 (1958).
104. It is not clear if the grant or denial of a motion to disqualify
counsel is appealable prior to a final adjudication on the merits. In Cord
v. Smith, 338 F.2d 516 (9th Cir. 1964), the court ruled that an order disqualifying
a lawyer on grounds of conflict of interest was not appealable, but treated
the “appeal” as a petition for a writ under 28 U.S.C. § 1651 (1966). An appeal
from a denial of a motion to disqualify was allowed in Yablonski v.
United Mine Workers, 448 F.2d 1175 (D.C. 1971). Accord, Cermaco, Inc.
v. Lee Pharmaceuticals, 510 F.2d 268 (2d Cir. 1975); Fullmer v. Harper, 517
F.2d 20 (10th Cir. 1975).
105. See, Estate of Trench, 76 Misc. 2d 180, 349 N.Y.S.2d 265 (Sup.
Ct. Suffolk County, 1973).
106. Silver Chrysler-Plymouth, Inc. v. Chrysler Motors, Inc., 370 F.
Supp. 581 (E.D.N.Y. 1973), aff’d, 518 F.2d 751 (2d Cir. 1975).
107. Normally a party moving to disqualify an opposing lawyer on
grounds of access to confidential communication must show the existence of
Valparaiso University Law Review, Vol. 10, No. 3 [1976], Art. 2
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CONFLICT OF INTEREST
cially if it consists of information learned in a confidential communication.’08
If the conflict of interest exists between an attorney
and his present client, the court should make every effort to protect
the client’s interests. The court of its own motion should
disqualify counsel if his appearance in the case makes it difficult
for him to exercise independent professional judgment. The administration
of justice requires true adversaries on each side,
regardless of one client’s hardship.
However, the Code of Professional Responsibility provides
two exceptions where an attorney can continue to act with the
full and informed consent of the client. DR 5-105 (c) allows an
attorney to represent multiple clients if he can “adequately represent
the interest of each and if each consents to the representation
after full disclosure of the possible effect of such representation
on the exercise of his independent professional judgment on
behalf of each.” Under DR 5-106, lawyers representing multiple
clients against whom claims are asserted may participate in an
“aggregate settlement of the claims” if each client consents to the
settlement after being advised of the existence and nature of all the
claims invoked in the proposed settlement, of the total amount
of the settlement, and of each person’s participation in the settlement.
Other potential remedies for conflicts of interest include the
court’s refusal to enforce attorney fees and the institution of a malpractice
suit by the aggrieved client. In Gesellschaft Fiir Drahtlose
Telegraphie M.B.H. v. Brown,’0 9 the court reversed a $250,000 judgment
for the attorney for legal services because the attorney’s
a prior attorney-client relationship. See Hicks v. Drew, 117 Cal. 305, 49 P.
189 (1897). But if the client has divulged confidential communications to a
lawyer in order for the lawyer to decide if he will take the case, the communication
is protected:
[I]f an attorney has discussed the case with his client or proposed
client, or voluntarily listens to his statement of the case preparatory
to the defense, he is thereby disqualified to accept employment
on the other side.
State v. Leigh, 178 Kan. 549, 289 P.2d 777, 778 (1955).
The observance of the ethical obligation of a lawyer to hold inviolate
the confidences and secrets of his client not only facilitates the full
development of facts essential to proper representation of the client
but also encourages laymen to seek legal assistance.
EC 4-1.
108. P.C. Theater Corp. v. Warner Bros., 113 F. Supp. 265 (S.D.N.Y.
1953).
109. 78 F.2d 410 (D.C. Cir.), cert. denied, 296 U.S. 618 (1985).
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450 VALPARAISO UNIVERSITY LAW REVIEW [Vol. 10
employment contract required him to take a position hostile to
his former client in the same matter. The court noted:
[p]laintiff’s claim for attorney’s fees is void and unenforceable,
since it is in conflict with the well-established
rule of public policy that where an attorney has acted
for a client he cannot thereafter assume a position hostile
to the client concerning the same matter, or use against
the client knowledge or information obtained from him
while the relation existed.11°
Calling the contract for legal services void as against public policy,
the court even refused to allow attorney’s fees on a quantum
meruit theory. Similarly, if a client is in fact injured by the conflict
of interest of his attorney, he may sue in tort for malpractice.”‘
Perhaps the strongest remedy for conflicts of interest is reversal
of a judgment tainted by the conflict. Due to its severity,
however, it should not be used unless the appellant in a criminal
or civil case was arguably injured by the conflict. But the courts
are prone to reverse without an actual conflict of interest to avoid
even the appearance of impropriety, especially in criminal cases.
Such was the situation in a Massachusetts criminal case when
the defense counsel’s law firm had represented several key prosecution
witnesses in unrelated matters. The criminal defendant made
several inquiries about the conflict of interest prior to the trial.
The Supreme Judicial Court of Massachusetts reversed the conviction
even though the court felt that the trial had been “otherwise
faultless,” that there was strong evidence of the defendant’s
guilt, and that the lawyer had conducted the defense with “competence
and vigor.”‘ 1 2 Courts have reversed criminal convictions
when the lawyer for the appellant represented multiple defendants,
and was thus placed in a position of favoring one client over the
appellant.’ Presumably the same position could be adopted in
civil matters.
110. Id. at 412.
111. See, e.g., MASS. GEN. LAWS ch. 221, § 40 (1958): “An attorney may
be removed . . .for malpractice .. . and shall also be liable in damages to
the person injured thereby.”
112. Commonwealth v. Geraway, 73 Mass. Adv. Sh. 1281, 301 N.E.2d
814, 818 (1973).
113. Glasser v. United States, 315 U.S. 60 (1942); Lollar v. United
States, 376 F.2d 243 (D.C. Cir. 1967); Naiz v. United States, 217 F.2d 355
(6th Cir. 1954).
Valparaiso University Law Review, Vol. 10, No. 3 [1976], Art. 2
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CONFLICT OF INTEREST
CONCLUSION
Conflicts of interest may arise in many situations. The most
obvious is where an attorney himself has a financial or personal
stake in the outcome of a client’s problem. Except for fee collection
cases, a lawyer must ensure that his client’s interests come
before his own, especially in contingency fee arrangements. Perhaps
a more subtle conflict arises when an attorney acts in capacities
which conflict with his role as lawyer, such as a witness
in litigation, administrator of an estate, guardian of an incompetent,
or public official. In such cases, great care must be taken
to avoid acting as attorney if he will thereby prejudice those
to whom he owes a fiduciary duty.
Similarly, in civil litigation, a lawyer may find himself involved
in representing conflicting interests of multiple clients
whose claims are realigned so as to make them adverse. As the
United Mine Workers cases and husband and wife lawyers situations
illustrate, attorneys must avoid both potential and real conflicts,
even where they result from later pleadings in the case.
One reason for avoiding conflicts is the potential abuse of the
attorney-client privilege; but many other reasons may also dictate
strong sanctions against the attorney who represents conflicting
interests.
Perhaps as important as the outcome of actual conflicts is
the public’s perception of potential abuses. Bar authorities believe
that lawyers are commonly criticized by clients for real or alleged
conflicts of interest. Sometimes a client simply feels that the attorney
has not asserted his case with sufficient vigor because the
attorney wants to spend more time working on better-paying
cases. Sometimes the client perceives the lawyer only as a selfish
businessman who will sell short those whom he serves for reasons
of expediency or self-interest. Less frequently, the client actually
believes that the lawyer is working against his own best interests
because of selfish reasons or influences by other parties. It is
certainly true that these grievances of clients are frequently unjustified
and unfair; evidence indicates that the number of formal
disciplinary proceedings against attorneys for conflict of interest
is relatively small.
However, the public’s reaction to apparent improprieties by
the legal profession is obviously important. Thus, lawyers should
take seriously the requirements of the Code of Professional Responsibility
and interpreting cases if they expect the public to
continue to accept them. Individual lawyers can help prevent
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452 VALPARAISO UNIVERSITY LAW REVIEW [Vol. 10
multiplying misperceptions in their clients by clear and frank
communications about the reasons for their courses of action. If
an apparent conflict of interest arises, the lawyer should contact
the client and explain clearly and precisely what he proposes to do.
Communication can help to eliminate false conflict of interest
problems. The real problems can only be resolved by the conscience
of the lawyer and the vigilance of the profession.

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