Transcript Slide 1

Bowing Out Professionally
Effective Settlements and How to
Ethically Withdraw to Avoid
Malpractice
Withdrawal
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Prior to entry of appearance before a
tribunal must comply with -
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Rule 4-1.16
After entry of appearance must comply
with –
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Rule 4-1.16 and
Any applicable law requiring notice to or
permission of the tribunal
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Rule 4-1.16(c)
See Rule 4-1.2 for Scope
Rule 4-1.16(c)
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of Representation and
Rule 55.03(b)(3) for
limited entry of
appearance and
termination of limited
appearance
(c) A lawyer must comply with applicable
law requiring notice to or permission of a
tribunal when terminating a representation
unless the lawyer has filed a notice of
termination of limited appearance. Except
when such notice is filed, a lawyer shall
continue representation when ordered to
do so by a tribunal notwithstanding good
cause for terminating the representation.
Mandatory Withdrawal
Rule 4-1.16(a)
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The representation will result in violation
of the rules of professional conduct or
other law;
The lawyer’s physical or mental condition
materially impairs the lawyer’s ability to
represent the client; or
The lawyer is discharged.
Permissive Withdrawal
Rule 4-1.16(b)
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(1) Withdrawal can be accomplished
without material adverse effect on the
interests of the client;
(2) The client persists in a course of action
involving the lawyer’s services that the
lawyer reasonably believes is criminal or
fraudulent;
(3) The client has used the lawyer’s
services to perpetrate a crime or fraud;
Permissive Withdrawal
Rule 4-1.16(b)
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(4) The client insists upon taking action
that the lawyer considers repugnant or
with which the lawyer has a fundamental
disagreement;
(5) The client fails substantially to fulfill an
obligation to the lawyer regarding the
lawyer’s services and has been given
reasonable warning that the lawyer will
withdraw unless the obligation is fulfilled;
Permissive Withdrawal
Rule 4-1.16(b)
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(6) The representation will result in an
unreasonable financial burden on the
lawyer or has been rendered unreasonably
difficult by the client; or
(7) Other good cause for withdrawal
exists.
Duties After Withdrawal
Rule 4-1.16(d)
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Upon termination of representation, a lawyer
shall take steps to the extent reasonably
practicable to protect a client's interests, such as
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giving reasonable notice to the client,
allowing time for employment of other counsel,
surrendering papers and property to which the client
is entitled and
refunding any advance payment of fee or expense
that has not been earned or incurred.
The lawyer may retain papers relating to the
client to the extent permitted by other law.
Duties After Withdrawal
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Still subject to Rules of Professional
Responsibility
See particularly -
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Rule 4-1.6 – Confidentiality of Information
Rule 4-1.9 – Duties to Former Clients
Rule 4-1.15 – Safekeeping Property
Actual Cases – Discipline Imposed
Actual Cases – Discipline Imposed
Actual Cases – Discipline Imposed
Actual Cases – Discipline Imposed
Actual Cases – Discipline Imposed
Informal Opinions
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Opinion Number: 20060053 - Rule Number:
QUESTION: Attorney has reason to believe that a Trustee misappropriated,
and perhaps stole, funds from a Trust. Since Attorney represented the
Trustee, is Attorney permitted to notify and inform the other beneficiaries of
the Trustee's management of the Trust and of Attorney's suspicions? To
Attorney's knowledge, the other beneficiaries have received no information
regarding the Trust, and they have not contacted Attorney.
ANSWER: Attorney may not disclose the information to the other
beneficiaries, unless Attorney has the consent of the Trustee. If the Trustee
will come forward with the necessary information, Attorney may continue to
represent the Trustee in attempting to resolve any problems. It is
permissible for Attorney to advise the Trustee that Attorney will withdraw if
the Trustee is unwilling to take the steps Attorney believes to be necessary,
including consenting to disclosure to the other beneficiaries. It is also
permissible for Attorney to withdraw, at this point, regardless of the steps
the Trustee is willing to take. If the Trustee is not willing to take the steps
necessary to resolve the problem and Attorney believes that the Trustee's
conduct is fraudulent or criminal, Attorney must withdraw if Attorney's
representation would assist the fraudulent or criminal activity.
Informal Opinions
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Opinion Number: 20030049 - Rule Number: 1.1; 1.16
QUESTION: Attorney's law firm recently lost the attorneys in its litigation department
and those attorneys are not able to continue to handle the litigation. Before leaving,
one of the attorneys won a trial on a personal injury case. The case was reversed and
remanded for new trial. Attorney's firm does not have anyone who can represent this
client adequately. Attorney's firm has been unsuccessful in securing other counsel for
the client. The case is not on a trial docket. May Attorney's firm withdraw under these
circumstances?
ANSWER: It is permissible for Attorney's firm to seek to withdraw, if you the firm can
do so at a time that will not be materially adverse to the client. Whether a case is on
a trial docket would be one factor in determining whether withdrawal, at a given
time, will be materially adverse. However, there could be other factors to consider,
such as discovery, court orders, etc. If there are no factors that will cause withdrawal
to be materially adverse to the client, Attorney's firm may seek to withdraw,
notwithstanding the fact that the client has been unable to find other counsel.
Whether Attorney's firm is permitted to withdraw is entirely in the discretion of the
court. If the court refuses to allow withdrawal, under Rule 4-1.16(c), Attorney's firm
must stay in the case and represent the client. Attorney's firm should be sure to
inform the court of its concerns about its ability to adequately represent the client, in
the course of seeking leave to withdraw.
Informal Opinions
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Opinion Number: 20030047 - Rule Number: 1.16(d); 1.15
QUESTION: If Attorney sends a client a courtesy copy of all
pleadings at the time of filing and a copy of all pleadings filed by
opposing counsel (with a notation that it is a courtesy copy for the
client's information and safekeeping), is it necessary to copy the file
and provide the documents again to the client? May attorney charge
for copies of documents previously sent to client?
ANSWER: It is permissible for copies provided to the client during
the course of the representation to serve as client's file, or a portion
of the client's file, if two conditions are met. First, Attorney would
have had to provide an explanation of this process prior to sending
the copies. Second, the original of the file belongs to the client.
Therefore, if there is an original in the file, a copy does not fulfill the
obligation to the client unless the attorney and client have agreed
that it will. If both conditions are not met, attorney should provide
the file to the client and keep copies at Attorney's own expense.
Informal Opinions
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Opinion Number: 20030010 - Rule Number: 1.16
QUESTION: Attorney represented client in a matter
which is now concluded. Attorney advanced funds for
court reporter fees and transcripts. The client has
requested copies of the transcripts, but has not
reimbursed Attorney for these expenses. Must Attorney
provide copies of the transcripts to the client?
ANSWER: Rule 4-1.16 requires Attorney to return the
client's property to the client at the conclusion of the
representation. However, under Formal Opinion 115, as
amended, Attorney may withhold items for which
Attorney has paid out-of-pocket and has not been
reimbursed.
Informal Opinions
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Opinion Number: 20000172 - Rule Number: 1.3; 1.16(b); 1.5
QUESTION: Attorney would like to add a provision to Attorney's
standard engagement letter for civil cases, particularly domestic
relations cases. Is it permissible to state in the engagement letter
that if the client does not make payment, Attorney will stop working
on his or her case? Attorney would like to state that Attorney will
not continue to work on a client's case if no payments are made.
ANSWER: Attorney may not include the provision Attorney proposes
in Attorney's engagement letter. Under Rule 4-1.3, Attorney has an
obligation to diligently represent Attorney´s client, unless Attorney
withdraws. If Attorney has not been paid, Attorney´s option is to
continue to diligently represent the client and seek payment, or seek
to withdraw. Attorney may seek to withdraw under Rule 4-1.16(b),
only if withdrawal may be accomplished without ´material adverse
effect on the interests of the client.
Informal Opinions
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Opinion Number: 960110 - Rule Number: 1.16
QUESTION: Attorney represents a client in a
matter which is set for hearing in several
months. The client did not divulge certain
information to Attorney which Attorney has now
learned. If Attorney had been aware of this
information, Attorney would not have taken the
case. May Attorney seek to withdraw?
ANSWER: Attorney may withdraw, if Attorney is
allowed by the tribunal to do so, as long as
Attorney is not at a point in the proceedings
such that the withdrawal will have a materially
adverse effect on Attorney´s client.
Informal Opinions
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Opinion Number: 950248 - Rule Number: 1.16
QUESTION: Attorney has lost contact with the clients. Attorney
wishes to withdraw. What is Attorney required to do to notify the
clients?
ANSWER: Attorney has a duty to take all reasonable steps to
contact the clients. It is unclear from the information Attorney has
provided whether Attorney has taken sufficient steps under the
circumstances. Attorney is not required to hire a private investigator
but Attorney should conduct a reasonable investigation. Attorney
has not indicated whether Attorney has checked with various
agencies or businesses that may have received notification of an
address change. The Department of Revenue (drivers and motor
vehicle licenses), employers, banks and relatives all may be
appropriate to contact, depending on the circumstances. Attorney is
not required to give notification to the clients by publication if
Attorney is unable to contact them any other way, but Attorney may
do so. Attorney should also seek guidance from Attorney´s
malpractice insurer's claims prevention office, regarding any
additional steps they may recommend.
Informal Opinions
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Opinion Number: 940175 - Rule Number: 1.16;5.24
QUESTION: Attorney is the trustee in bankruptcy for an
attorney who is now deceased. The deceased attorney
had closed client files from many years of practice. What
should the trustee do about the files?
ANSWER: Rule 5.24 provides a mechanism for
appointment of a trustee to wind up the practice of a
deceased attorney. That rule would not prohibit the
bankruptcy trustee from also being the trustee for the
practice. The attorney who is appointed trustee under
Rule 5.24 should make an effort to return the files to the
clients.
Informal Opinions
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Opinion Number: 940065 - Rule Number: 1.5;1.16(d)
QUESTION: Attorney accepted a case on a flat fee basis.
Attorney now wishes to withdraw before the case is
concluded due to the client's lack of cooperation.
Attorney states that, as a result of client's lack of
cooperation, attorney fees valuing several times the flat
fee paid have been provided. May Attorney withdraw
and, if so, what amount of refund, if any, is owed the
client?
ANSWER: Attorney may ask the court for leave to
withdraw. This office cannot resolved factual issues such
as the amount of a refund owed in the context of an
informal advisory opinion.
Informal Opinions
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Opinion Number: 940059 - Rule Number: 1.4;1.16(d)
QUESTION: Attorney is representing the class in a class
action suit. One of the members of the class is recruiting
class members and obtaining the attorney fee which is
forwarded to Attorney. May Attorney accept these
people as clients in this manner?
ANSWER: Yes. Once Attorney accepts them as clients,
Attorney must communicate with them directly affirming
Attorney´s representation and communicating about the
case before taking any action as their attorney. If they
change their mind after direct communication, Attorney
must refund the fee under Rule 4-1.16. This opinion
does not consider any restrictions the court may impose.
Informal Opinions
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Opinion Number: 940038 - Rule Number: 1.16
QUESTION: Attorney and the client have
disagreed over the amount of settlement that
would be reasonable. As a result, the client has
discharged Attorney twice but has returned
when other attorneys told the client that
Attorney´s assessment of the case was
reasonable. May Attorney withdraw?
ANSWER: Yes. Attorney must comply with all of
the requirements of Rule 4-1.16(d), including
the requirement that Attorney not withdraw if
the withdrawal would have a materially adverse
impact on the interests of Attorney´s client.
Informal Opinions
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Opinion Number: 940027 - Rule Number: 1.6
QUESTION: Attorney's client is receiving Medicaid.
Attorney has obtained agreement from an insurance
company to settle a personal injury case. Statutes
require both Attorney and client to notify Social Services
of the settlement. Client has withdrawn authority to
settle and discharged Attorney after Attorney informed
client of this obligation. May Attorney report to Social
Services?
ANSWER: If Attorney reports without client's consent,
Attorney will violate the confidentiality obligation under
Rule 4-1.6. Attorney should counsel client regarding the
obligations under the statutes prior to withdrawing. If
client will not consent to reporting, Attorney must
remain silent and withdraw under Rule 4-1.16(a)(1).
Informal Opinions
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Opinion Number: 940019 - Rule Number: 1.16
Question 1. May Attorney move to withdraw from a
criminal case if the client is uncooperative and will not
communicate or assist with the defense? The Attorney
will warn the client that Attorney will withdraw if the
situation doesn't improve before the Attorney actually
withdraws.
Question 2. If a client who is a criminal defendant fails
to make a court date and a warrant is issued and the
client has had no contact with Attorney for several
weeks or months, may Attorney move to withdraw?
ANSWER: Yes to both questions. However, the fact that
the Rules of Professional Conduct allow Attorney to
move to withdraw does not affect the authority of the
court to refuse to sustain that motion.
Informal Opinions
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Opinion Number: 940011 - Rule Number:
1.16
QUESTION: Attorney accepted a client in a
dissolution case. Attorney accepted the
retainer and the filing fee but has not
filed. If Attorney returns the filing fee and
retainer, may Attorney withdraw?
ANSWER: Yes.
Informal Opinions
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Opinion Number: 930099 - Rule Number:
1.16
QUESTION: May an attorney withdraw
from a case due to the client's
interference with the representation?
ANSWER: Yes. Attorney must comply with
all of the requirements of Rule 1.16(d).
In re Donaho
98 S.W.3d 871 (Mo. banc 2003)
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Donaho, licensed in both Illinois and
Missouri agreed to represent Campbell in a
post-dissolution action
Campbell paid him $700 fee and $60 filing
fee
Donaho prepared the motion and sent it
to Campbell, who promptly signed and
returned it
Donaho took no further action
In re Donaho
98 S.W.3d 871 (Mo. banc 2003)
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Six months later Donoho closed his Illinois office
and opened a new office in St. Louis
Did not inform Campbell of new address or
telephone number
Campbell –
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Left messages on Donaho’s home phone which he did
not return
Tried to contact him at new office and he did not
respond
Send certified letter to new office, which he received
but did not respond
In re Donaho
98 S.W.3d 871 (Mo. banc 2003)
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Campbell demanded return of fee
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Donaho responded that he would return the
fee if Campbell signed a complete release
Donaho drafted the release, but did not
advise Campbell to seek independent advice
Campbell signed and returned the release
Donaho failed to return the money as
promised
In re Donaho
98 S.W.3d 871 (Mo. banc 2003)
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Campbell filed suit in small claims and obtained
a default judgment for $765, which Donaho did
not pay
Campbell filed complaint with OCDC
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Disciplinary committee indicated to Donaho that
timely payment of the judgment would be considered
a mitigating factor and would be viewed favorably if
satisfied by a certain date
Donaho faxed copies of two money orders made out
to Campbell and represented that they had been sent
to Campbell
Committee admonished Donaho and closed file
Instead of mailing the money orders to Campbell,
however, Donaho cashed them for his own use
In re Donaho
98 S.W.3d 871 (Mo. banc 2003)
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Campbell filed second complaint with OCDC –
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Among the rule violations the committee included in
the charge was a violation of Rule 4-1.16(d)
Supreme court stated: “As noted in the disciplinary
rules, ‘[p]erhaps no professional shortcoming is more
widely resented than procrastination.’ Rule 4-1.3,
Comment. Of course, the fact that Respondent failed
to refund the advance fee upon the termination of
representation as required by Rule 4-1.16(d)
compounds the problem.
Supreme Court suspended Donaho’s license
indefinitely with leave to apply for reinstatement no
sooner than twelve months after date of opinion
Supreme Court noted in passing that: “the evidence
suggests that [Donaho] may have been suffering
from a drinking problem during the time in question”
In the Interest of P.D.
144 S.W.3d 907 (Mo.App., E.D. 2003)
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Lawyer represented natural mother in
termination of parental rights case
Hearing on September 23
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Mother was present
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Case set for trial on December 17
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Lawyer sent mother letter confirming trial date
Date of trial Mother did not appear
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Lawyer moved for continuance, which court denied
Lawyer orally moved to withdraw, which court
sustained
In the Interest of P.D.
144 S.W.3d 907 (Mo.App., E.D. 2003)
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On appeal mother claimed trial court
abused its discretion is allowing her lawyer
to withdraw
Eastern District, citing Rule 4-1.16 and a
local court rule, held that trial court
abused its discretion because there was
nothing in the record that lawyer had
provided mother with notice of his intent
to request to withdraw
Judgment of termination was reversed
Effective and Ethical Settlements
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Rule 4-1.2
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A lawyer shall abide by a client’s decisions
concerning the objectives of the
representation
A lawyer shall abide by a client’s decision
whether to settle a matter
Comment 3: At the outset of the
representation, the client may authorize the
lawyer to take specific action on client’s behalf
without further consultation
Effective and Ethical Settlements
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Rule 4-1.4 requires that the lawyer explain
a matter to the extent reasonably
necessary to permit the client to make
informed decisions regarding the
representation
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Interplay between Rule 4-1.2 and 4-1.4
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Client’s decision whether or not to settle a case
must be an informed decision
Effective and Ethical Settlements
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Rule 4-4.1 prohibits a lawyer from making a
false statement of material fact to a 3rd person
while representing a client
What about false statements made by counsel
during a settlement negotiation?
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Comment 2: Under generally accepted conventions in
negotiation, certain types of statements ordinarily are
not taken as statements of material fact (e.g.,
estimates of value or the client’s intentions as to an
acceptable settlement of a claim)
In re Coleman, 295 S.W.3d 857
(Mo. banc 2009)
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Client hired Coleman to represent her in 3
separate civil actions (med. malpractice,
wrongful term. and discrimination cases)
During next 5 years, client paid Coleman
up to $50,000 in fees and expenses.
When client no longer able to pay
additional fees, Coleman suggested
converting the 3 cases to contingent fee
agreements. Client agreed.
In re Coleman
“In consideration of one-third (1/3) of any recovery,
I agree to forego my hourly rate, and instead, agree
to accept one-third of any recovery. However,
because I am taking a risk with you on this case,
and because I am more familiar with the legal
trends relative to judgments, settlements, and
summary disposition, you agree I shall have the
exclusive right to determine when and for how
much to settle this case. That way, I am not held
hostage to an agreement I disagree with.”
In re Coleman
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The employer in the discrimination case offered
to settle the client’s claim for $20,000. The client
rejected the offer.
Coleman settled the case without his client’s
consent. Coleman submitted settlement
documents to the client. Client refused to sign
and insisted on proceeding to trial.
Coleman withdrew in all 3 cases and filed a
motion to enforce settlement in the
discrimination case.
In re Coleman
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Violations found by the Court:
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Rule 4-1.2 (Scope of Representation) by accepting a
settlement offer without client consent and filing a motion to
enforce the settlement;
Rule 4-1.7 (Conflict of Interest) by entering into a written
agreement with his client purporting to give Coleman
exclusive settlement rights and taking actions adverse to the
client’s interests;
Rule 4-1.16 (Terminating Representation) by failing to protect
his client’s interests upon termination
Rule 4-8.4 (Misconduct) by engaging in conduct prejudicial to
the administration of justice.
Discipline ordered: one year stayed suspension with probation.
Questions?