(Inquiry No. )
Opinion No. 2020-01
Inquiry No. 2020-1
March 2, 2020
Topic: Conflict of interest – former client; imputed conflicts; responsibilities of law firm partners and supervisory lawyers
Law firm partner, whose prior representation of a client at his former firm creates an imputed conflict as to representation of his current firm’s client, is required to make reasonable efforts to ensure that lawyers under his supervision do not represent current firm’s client in the absence of a conflict waiver and that management of firm is aware of imputed conflict and the prohibition of continuing the representation in the absence of a conflict waiver.
1.9, 1.10, 5.1, 8.3
Inquiring counsel was previously an associate of Firm A. While at Firm A, inquiring counsel worked on an estate litigation matter, representing the daughter (D) of a decedent in a discovery and turnover proceeding against two defendants, a husband (H) and wife (W), alleging that H and W had fraudulently procured funds from the decedent during his lifetime, in an attempt to bring the funds back into the decedent’s estate. Inquiring counsel drafted the petition which was served on H and W and did other work on the matter for a period of time until D terminated Firm A and retained new counsel to represent her in the ongoing proceeding.
Inquiring counsel left Firm A and joined Firm B as a partner in the trusts and estates department. Unbeknownst to inquiring counsel, W was a client of Firm B with respect to other matters. When W died, inquiring counsel was asked to handle the administration of W’s estate. Inquiring counsel subsequently learned that D’s case against H and W had not been resolved and that D was pursuing claims against W’s estate. Inquiring counsel has personally withdrawn from the representation of W’s estate, and inquires as to whether he has any further obligations with regard to Firm B’s representation of W’s estate.
What are inquiring counsel’s obligations with regard to Firm B’s administration of W’s estate?
Inquiring Counsel’s Conflict of Interest is Imputed to Firm B
Inquiring counsel’s prior representation of D creates a conflict of interest prohibiting his representation of W’s estate in the absence of a waiver. Rule 1.9(a) governs conflicts of interest concerning former clients, providing that “A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.” Rule 1.9(a) applies to the facts here, as inquiring counsel formerly represented D in the same matter in which inquiring counsel would be representing the estate of W—a party with interests materially adverse to D’s interests. Thus, inquiring counsel may not represent the estate of W unless D gives informed consent, confirmed in writing.
Inquiring counsel’s conflict of interest is imputed to Firm B. Rule 1.10 addresses whether an individual attorney’s conflict of interest will be imputed to his or his firm. Rule 1.10(a) provides: that “While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rule . . . . 1.9, except as otherwise provided therein.” Rule 1.10(c) further provides that “When a lawyer becomes associated with a firm, the firm may not knowingly represent a client in a matter that is the same as or substantially related to a matter in which the newly associated lawyer, or a firm with which that lawyer was associated, formerly represented a client whose interests are materially adverse to the prospective or current client unless the newly associated lawyer did not acquire any information protected by Rule 1.6 or 1.9(c) that is material to the current matter.”
Thus, Firm B may not represent the estate of W unless inquiring counsel “did not acquire any information protected by Rule 1.6 or 1.9(c) that is material to the current matter.” Here, due to the fact that inquiring counsel was directly working on the estate litigation on behalf of D, it would likely be presumed that inquiring counsel did acquire protected information. As Comment  to Rule 1.9 notes, “A conclusion about the possession of such information may be based on the nature of the services the lawyer provided the former client and information that would in ordinary practice be learned by a lawyer providing such services.”
Inquiring Counsel’s Duty to Ensure Firm B’s Compliance With the Rules of Professional Conduct
Because inquiring counsel is or should be aware of the fact that his conflict of interest is imputed to Firm B, he has a duty to make reasonable efforts to ensure that the other lawyers in Firm B’s trusts and estates department comply with their obligations as attorneys with an imputed conflict of interest under Rule 1.10. Rule 5.1(b) provides that “A lawyer with direct supervisory authority over another lawyer shall make reasonable efforts to ensure that the supervised lawyer conforms to these Rules.” Inquiring counsel, as a partner in Firm B’s trusts and estates department, has supervisory authority over other attorneys in the trusts and estates department, and thus is required to take reasonable efforts to ensure that said attorneys do not violate the Rules of Professional Conduct, including Rule 1.10, by taking on, or continuing, a conflicted representation without obtaining the necessary waivers.
Moreover, pursuant to Rule 5.1(d), “A lawyer shall be responsible for a violation of these Rules by another lawyer if . . . (2) the lawyer is a partner in a law firm or is a lawyer who individually or together with other lawyers possesses comparable managerial responsibility in a law firm in which the other lawyer practices or is a lawyer who has supervisory authority over the other lawyer; and (i) knows of such conduct at a time when it could be prevented or its consequences avoided or mitigated but fails to take reasonable remedial action . . .” Under Rule 5.1(d), inquiring counsel, as a partner of the firm, could be responsible for the violation of the Rules of Professional Conduct by another lawyer at Firm B if inquiring counsel knows of such conduct and fails to take reasonable remedial action. According to Professor Roy Simon, this applies to “all lawyers in a firm who are designated by the title ‘partner’” regardless of whether he or she has direct supervisory authority over the lawyer who engaged in misconduct and regardless of whether the lawyer is an equity partner or a non-equity partner. Roy D. Simon, Jr., Simon’s New York Rules of Professional Conduct Annotated, §5.1:24 (2019).
The question thus becomes: what “reasonable remedial action” should the inquiring attorney take in order to avoid responsibility under Rule 5.1(d). The inquiring attorney has already undertaken some reasonable remedial action by advising his present firm of the conflict and by ending his own personal involvement in the specific matter. In the Committee’s view, however, the inquiring attorney must go further. As a partner in the firm’s trusts and estates department, the inquiring attorney should direct the handling attorneys to advise the former client’s present attorneys of the conflict. He should further direct the handling attorney to advise the firm’s client that there exists grounds for potential disqualification of the firm.
We note that Rule 1.10(d) permits a disqualification prescribed by Rule 1.10 to be “waived by the affected client or former client under the conditions stated in Rule 1.7.” Thus, Firm B could represent the estate of W if the conditions under Rule 1.7 are met and D (as well as the representative of W’s estate) gives informed consent, confirmed in writing. The inquiring attorney can encourage the handling attorneys at his firm to seek such consent, and direct them to end the representation if the consent cannot be obtained.
If the inquiring attorney does not have direct supervisory control over the handling attorneys and does not have the ability to unilaterally terminate the firm’s attorney-client relationship, he should advise the firm’s ethics counsel, managing attorney(s) and/or management committee of the conflict and the fact that the conflict is imputed to other attorneys at the firm in accordance with Rule 1.10. The Committee does not opine as to whether the inquiring attorney has an obligation under Rule 8.3 to report professional misconduct of others at his firm, as we do not have sufficient information from which to conclude that other attorneys at his firm committed violations of the Rules of Professional Conduct which raise “a substantial question as [their] honesty, trustworthiness or fitness as . . . lawyer[s].”
In sum, inquiring counsel has an ethical obligation not only to address and avoid his own conflict of interest with respect to the representation of W’s estate, but to take reasonable efforts to ensure that other lawyers in Firm B comply with their obligations as to imputed conflicts of interest. If inquiring counsel has supervisory authority over the attorneys handling the matter which gives rise to the conflict, he should direct them to advise both the former client’s present attorneys and Firm B’s client of the conflict and seek a waiver of the conflict. If the waiver cannot be obtained, Firm B should terminate the attorney-client relationship at issue. If the attorney does not have supervisory authority over the handling attorneys at Firm B, he should advise those at Firm B who do have supervisory authority.
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