Model Code – Canons **New York Still Has Model Code**
· EC – aspirational
· DR – Rules
Model Rules in 1983 (in NY in 2 years) (MPRE – Only Model Rule).
· In Late 1990’s there was an Update completed in 2002.
· After Enron there was 2 changes for Financial in 2003
problem 4: Fundamental of the Lawyer-Client Relationship:
Facts:
Bad investment
Broker took excessive risk and bought/sold frequently to make a lot in commission.
I knew what he was doing, I could have stopped him but I got greedy.
I want you to throw the book at my broker.
Best Argument: Broker engaged in illegal churning and violated the federal rules relating to an investor’s suitability (what stocks are suitable to meet a given investor’s objectives, here safety and income.)
Client not happy – wants his license and tie up his bank accounts.
The SoL is about to run on all federal and state claims and tell client only will bring claim on suitability and churning. He reluctantly agrees.
After extensive discovery the Broker’s Attorney makes you a fair offer.
Knowing that he was angry you accept on the spot so he could not throw away the opportunity.
Model Rule 1.7 – A law firm may not represent both sides in the same litigated case.
Once a lawyer has learned confidential information from an actual client typically means that neither the lawyer nor anyone else in that lawyer’s firm may oppose that client in the same or a substantially related matter.
There is an opportunity cost to initial interviews because of rules concerning Prospective Client
Duty before become a client:
1) Have to treat information confidentially
2) Have to take care of any property they give you
3) Have to give them competent advice.
Do you have to take every client?
· No. A lawyer is under no obligation to act as an advisor for every client that contacts him.
· There are no legal limits that restrain a lawyer’s right to reject a case.
· A lawyer however should not lightly decline proffered employment and should take his share of tendered employment which may be unattractive both to him and the bar generally.
A lawyer’s decision to represent a client commits that lawyer to zealously furthering the interest of one whom the lawyer or others in the Community believe to be morally repugnant.
A lawyer is not obligated to accept a client whose character or cause the lawyer regards as repugnant.
Model Rule 1.2b – who we take does not constitute an endorsement of client’s view or activities.
Do not take a case that is frivolous, harassing or to seek revenge, you need to have a legal claim.
Sometime need to tell client that you understand they are angry, but there are ways to do this, have a moral dialogue with your client.
Become a client when it is the client’s reasonable perception that they are a client.
A relationship of client and lawyer arises when a person manifest to a lawyer the person’s intent that the lawyer proceed legal services for the person and either
a) Consents – The lawyer manifests to the person consent to do so; or
b) Reliance – The lawyer fails to manifest lack of consent to do so, and the lawyer knows or reasonably should know that the person reasonably relied on the lawyer to provide service.
Lawyer will bear risk of ambiguity about whether the lawyer-client relation has been formed?
Engagement Letter:A letter transmitted to client as countersigned by client which should contain:
1) Who the client is
2) Scope of representation, what the lawyer is undertaking to do
3) The fee for representation Rule 1.3
4) Conflicts of interest the lawyer may have and sufficient information to let the client give informed consent if it is willing to waive the conflicts
5) Any departures from the usual assumptions about handling confidential information such as possible agreement to share information between spouses who come in for a joint estate planning. Model Rule 1.6
6) Undertakings the client will be asked to make in connection with the representation, such as an agreement to be candid with the lawyer about the relevant facts.
Non-Engagement Letter – If a lawyer decides not to represent a client they should also send a letter documenting that fact to avoid a later claim.
Want to limit the scope of representation to a client to protect from a later suit because the lawyer did not do something on behalf of the client. Scope of representation is not self evident.
Decision making during representation – issues the lawyer is to decide and issues reserved to the client
“Allocation of Decision Making Authority” Raful
Defines the Lawyers Role
1) Traditional Rule – Means Ends Test – Client tells the ends, Lawyer decides the means. NY follows
Justifications:
· Paternalism – our clients are not capable of making decisions, we have to because we make sure their rights are upheld.
· Attorney Autonomy – we are not a mouth piece of client, we do what we want.
· Efficiency – it is more efficient to trust me.
Criticisms:
· Assume only care about the ends, they might care about the means.
· Why assume can separate the means and the end.
· Why do we let the client control anything if think so stupid?
2) Informed Consent – Now will be Informed Consent from the Client to act. It increases the dignity of client, adds legitimacy to law, and now both rich and poor can control their own destiny.
Criticism:
Paternalism will still come out
Clients will bargain away rights
Up to the Client
Decision to Plead
Decision for a settlement is up to the client
Decision to waive a jury trial is up to the client
Whether to testify in a criminal matter is up to the client
NY – get to decide what witnesses to call, what defenses plead, what claims /objections to make.
· Really important to do a CYA Memo – write a contemporaneous memo (short note) for the file of what you discussed in your meetings. What talked about, what you decided and time stamp it.
· Keep client informed. The major claim brought against the lawyer is neglect of a client.
· Model Rule 3.1 – Cannot bring a case unless there is a basis in law or fact for…
· Model Rule 1.2 – You can never settle a matter without talking to the client!
TEST QUESTION: NO 1.2a – cannot change client mind….line between convincing and harassing.
The Legal Profession: Background and Fundamental Issues
The ABA Model Rules from either 1983 or 2002-2003 have only the status of proposed law. They are models that must be adopted or rejected by individual state supreme courts before they have a legal effect. The “Code of Ethics” binding on me will be the one adopted by the NY Court of Appeals.
Four Sources of Authority and Advice for Legal Ethics:
1) Court decision whether in cases seeking discipline of lawyers, cases seeking malpractice damages, contempt proceedings, and criminal cases.
2) ABA and state and local bar associations Ethical Opinions. Not legally binding but used. American Law Institute – The Law Governing Lawyers, not legally binding courts often cited.
3) Federal Agencies issue regulations that regulate the work of lawyers who appear before them.
Three Parts of Ethical Analysis:
1) Defining a minimum standard below which conduct may not fall.
2) Establishing standards of ideal behavior towards which individuals should aims
3) Giving practical advice that is somewhere in between.
Kohlberg – Six Stages of Moral Growth
1) Adherence to rules imposed on lawyers by state supreme courts.
2) “I will be good to you if you are good to me”
3) Conforms behavior to something he thinks other will approve.
4) Respect to authority
5) Official morality of democracy
6) Universal Ethical Principles
Consequential – Utilitarian – chose the course of conduct that brings the greatest well being.
u tell the client, well probably best to drive home that jury can come back with nothing, and will take a long time, but it might come back up to $60,000, but remember could be $0.
Suggested Factors to determine if contingency is proper:
1) Is there a genuine and substantial question of liability or is the only real question the amount of damages?
2) Is the case likely to be settled or tried to verdict
3) If the amount of recovery likely to be small or large – for example soft tissue damage or death of a families bread winner.
Until the lawyer knows the answer to these it is improper and unfair to know if a % contingent is proper.
· Contingent not proper: Model Rule 1.5(d) A lawyer shall not enter into an arrangement for, charge, or collect:
o (1) Domestic relations – contingent upon the securing of a divorce or upon the amount of alimony or support, or property settlement in lieu thereof; or
o (2) Criminal case because it will discourage a ∆ attorney from taking a plea.
Reasoning:
This is because we do not want to promote the breaking of relationships.
· Need to tell Client A that you are going to be working on Client B’s file on the plane. He must ok it.
· States the kind of fee arrangements which are not allowed:
o Include contingency fee in a domestic relations matter, where the fee is contingent upon securing a divorce, alimony etc.
o Contingency fee re: Criminal Matters. What is freedom valued at
Collateral Effects of hourly rates want 2000 hours, which is basically 830-630 six days a week.
Move towards fixed fees for recurring, routine tasks.
Lawyer’s productivity in revenue for the firm not just hours.
To determine what fee the Lawyer is entitled to where Client terminates early and it was on Continent basis:
Normal rule is Quantum Meruit recovery.
Quantum Meruit to Recover Fee:
· legal services had be performed
· client accepted services
· with expectation of payment for the services
· value of the services could be ascertained
In case of contingent fee the first attorney can only recover if second prevails.
Problem 6 – Handling of Client Property and Withdrawing from Rep.
AKA: The death penalty for lawyer, you steal money or commingle you will be disbarred.
Facts:
Award ring and 100,000 in punitive damages
Contract was for 40% of all damages
Client after getting award thought it to be too high and wouldn’t pay more than $25,000
Attorney got the ring and money and told the client I will not turn it over until we work this out.
Busy lawyer, another client complained not returning calls quick enough, and told get another lawyer and filed a notice of withdrawal.
Another client sensed she would be slow to pay so she took security inland, was slow to pay forced an involuntary sale and refused to give the judgment so that client could get a loan he needed.
Important that lawyers pay attention to their handling of client property because Fiduciary relationship
Trustworthy management of client property is one of the lawyer’s fundamental
