Law Practice Management

1
Law Practice Management

• Class 6 Conflicts and Bar Grievances

2
Conflicts of Interest

• Need to be sensitive to conflicts of interest
• Not all conflicts are apparent at beginning of
  representation
• Need to look forward to anticipated developments
  in case (witnesses, experts, etc.)
• Need to take steps in advance to resolve
  conflicts or, if not resolvable, decline
  representation or withdraw

3
Common conflicts

• Represent two or more plaintiffs against same
  defendant
• Even where actions are unrelated, there may be a
  collection-related conflict
• Parties with contrary legal positions/theories
• Exacerbated if in same court
• Winning for one client often means losing for
  other

4
Common conflicts (cont.)

• Partnerships
• Representing multiple partners
• Representing both a partner and the partnership
  itself
• Corporations
• Representing multiple directors
• Representing both a director and the corporation
  itself

5
Common conflicts (cont.)

• Divorce cases
• NEVER represent both spouses
• Dont pretend to represent the children unless
  you are appointed to do so by the court
• Decline to represent either spouse if you
  previously represented both spouses in matters
  such as estate planning or closely-held
  businesses
• Watch for shoppers who meet with lawyers just
  to disqualify them from representing spouse
• Good reason not to offer free consultations

6
Common conflicts (cont.)

• Multiple defendants or potential defendants in
  criminal or civil cases
• Criminal defendants may turn on each other to cut
  a plea deal in exchange for testimony
• Civil defendants may try to shift liability to
  other defendant(s)
• Passenger and driver in auto accident cases
• Owner/driver liability may be issue

7
What can happen to lawyer if conflict is ignored
or mishandled?

• Withdrawal from case
• Become object of motion to disqualify
• Heard in open court in front of your peers
• May not be able to collect fees due
• May have to refund fees already collected
• May face disciplinary proceedings or malpractice
  litigation

8
What can happen to client in conflict of interest
cases?

• Need to retain new lawyer
• Delay associated with bringing new lawyer up to
  date on case
• Delay in court date and ultimate resolution of
  matter

9
Resolve conflict FIRST

• Better to recognize conflict and avoid working on
  case than to work on case, then find conflict,
  and not get paid
• Everyone has to eat crow (admit mistake)
  sometime
• Better to do so when crow is young and tender
  rather than when crow is old and tough

10
Waiver of conflict?

• Conflict does not preclude representation if
  conflict can be waived
• Some conflicts should not be waived
• Such as representing both spouses in a divorce
• Always get conflict waiver IN WRITING
• See Foonberg pp 224-227 for sample waiver clauses

11
Ethics problems

• Avoiding an ethics war is much better than
  winning one
• Collateral damage to your reputation is serious
  and permanent even if you prevail
• The time and effort it takes to win an ethics
  battle could be better spend on fee-generating
  client work

12
Ethics Hotlines

• Most State Bars Have Some Form of Ethics Hotlline
• FL Ethics Hotline for Oral Advisory Opinion call
  [phone]
• Written Ethics Opinion (3-5 weeks) write to FL
  Bar (standard request form online)

13
Common ethics issues

• Amount of Fee
• Generally must be reasonable
• If unsure what to charge, call other lawyers with
  experience in the area
• Fee agreement must be in writing
• Keep accurate time records

14
Common ethics issues (cont.)

• Fee Splitting
• Must be disclosed to client
• Fee must not increase due to fee-splitting
  arrangement
• Cant split fees with non-lawyers or, in most
  cases, with out of state lawyer
• Exception is with non-profit lawyer referral
  agencies approved by the Bar (usually run by
  local bar association)

15
Common ethics issues (cont.)

• Fee Splitting in Florida - FL Rule 4-1.5(g)
• total fee must be reasonable
• division of fees in proportion to the services
  performed by each lawyer
• written agreement with the client
• discloses the basis upon which that division will
  be made
• each lawyer assumes joint legal responsibility
  for the representation
• each lawyer is available for consultation with
  the client.

16
Common ethics issues (cont.)

• Fees paid by third parties
• Duty is to client, not person paying fee
• Fee agreement should state that duty will be to
  client, not fee payer, if conflict arises
• Common problem when insurance carrier is paying
  fee for the insured

17
Common ethics issues (cont.)

• Failure to refund unearned fees
• Fee agreement should be clear that fee is flat or
  fixed and not dependent on time devoted to
  matter, continued representation, or result
  achieved
• Dropping client for failure to pay
• Place appropriate clause in agreement letting you
  get out if client doesnt pay
• Court permission required for litigation matters

18
Common ethics issues (cont.)

• False billing practices
• Overstating number of hours worked on case
• Often to make up for unrealistically low hourly
  rate
• Misstating who did the work
• Billing for paralegal time at lawyers rate

19
Common ethics issues (cont.)

• Depositing fee advance prematurely in to
  operating account
• Unless the fee is specified as non-refundable
  (and meets certain other requirements), fees are
  not earned until the work is done
• Ethical violation to deposit or transfer such
  funds into firm operating account before fee is
  earned

20
Common ethics issues (cont.)

• Suing clients for unpaid fees
• Expect counter-claim for malpractice
• Waiting until malpractice statute of limitation
  runs may limit counter-claim to amount of fees in
  dispute
• Before you sue, make sure your file is in order
  and you have done an exemplary job for the client
• Consider ADR (mediation or arbitration)
• Juries dont like lawyers, and especially dont
  like suits for fees

21
Common ethics issues (cont.)

• Lack of a written fee agreement
• No written agreement often means not getting paid
  or being forced to take less than the full amount
  billed
• Agreement often defines scope of representation,
  which is important to avoid being pulled into
  disputes that were not contemplated
• Agreement should have clients signature as well
  as lawyers signature

22
Common ethics issues (cont.)

• Failure to communicate all settlement offers
• May think offer is totally unacceptable, but must
  still advise client of offer
• Free to offer your recommendation on offer

23
Common ethics issues (cont.)

• Failure to keep client informed of progress of
  matter
• Copies of all incoming and outgoing
  correspondence, pleadings, emails, etc.
• Foonberg says bombard them with paper at p 542
• Client should have a file nearly complete as your
  own
• Some firms provide nice binders for this purpose
  at beginning of representation

24
Common ethics issues (cont.)

• Media advertising
• Follow the three Ts
• Truthful
• Tasteful
• Tentative
• Do not guarantee results
• Most complaints come from fellow lawyers, not
  clients

25
Common ethics issues (cont.)

• Indirect media advertising
• Keep yourself in the news
• Frequent press releases trumpeting
  accomplishments and awards
• Keep a list of all media contacts in your area
  including email addresses, fax numbers, telephone
  numbers, etc.
• Recognize when case related publicity may be
  helpful to you but hurt your client Avoid
  crossing this line

26
Common ethics issues (cont.)

• Nonsolicitation mailings
• Firm newsletters
• Paper and email
• Announcements
• Brochures
• Holiday cards
• PR mailings with copies or excerpts of articles
  about self or firm

27
Common ethics issues (cont.)

• No recovery, no fee advertising
• Client may still be liable for costs, which can
  be substantial
• May also be sanctions or other penalties for
  non-meritorious filings

28
Common ethics issues (cont.)

• Selection of firm name
• Many jurisdictions have restrictions on
  fictitious names
• Often cant use name that sounds like a research
  or educational non-profit institution
• Cant always use names of deceased lawyers
• Can often use names that describe the nature of
  the firms practice
• Business Litigation Group
• Environmental Law Group

29
Common ethics issues (cont.)

• Buying or selling law practice
• Many states still prohibit the direct sale or
  purchase of a law practice
• Forming entity for merger purposes, then
  transferring goodwill is a workaround

30
Common ethics issues (cont.)

• Coaching a client to lie
• Ethical violation everywhere
• Some jurisdictions require lawyer to withdraw and
  blow whistle on client if lawyer is convinced
  that the client lied

31
Common ethics issues (cont.)

• Failure to turn over client file when discharged
• Must return to client all property, including
  documents, that belong to the client
• Must provide copies of all other file documents
• Who bears the copying cost varies with
  jurisdiction, but this can often be specified in
  the fee agreement

32
Common ethics issues (cont.)

• Premature destruction of client file
• Should first return documents belonging to client
• Must be able to demonstrate compliance with file
  retention policy
• Best to have policy in fee agreement signed by
  client
• Archive paper files on CD or DVD

33
Common ethics issues (cont.)

• Inadvertent violations of Attorney-Client
  confidences
• Discussion of client matters in public places
• Misdirected mail, faxes, emails
• Sending enclosures to wrong person via mail (or
  attaching wrong files to email)
• Failure to use Personal and Confidential on
  sensitive mail, faxes, email
• Not protecting identity of client

34
Common ethics issues (cont.)

• Failure to teach client confidentiality to
• Members of lawyers family
• Independent contractors
• Office staff and others who come into contact
  with case file
• Special problem in smaller or close-knit
  communities

35
Common ethics issues (cont.)

• Trust account violations
• Overdrawing trust account usually ethical
  violation per se with no defense
• Taking client funds for personal use almost
  always results in suspension or disbarment

36
Common ethics issues (cont.)

• Getting into business deals with clients
• Never trade fees for a piece of the action in a
  questionable business venture
• Foonberg, p 555 A lawyer who wears two hats
  has no head
• May move services outside of your malpractice
  policy coverage

37
Common ethics issues (cont.)

• Alternative billing methods
• Results-oriented bonus fees not permitted in
  every jurisdiction or in all types of cases
• Florida does not permit results-oriented fees in
  family law cases because they too closely
  resemble an impermissible contingent fee

38
Common ethics issues (cont.)

• Overly zealous representation of client
• Rule permitting zealous representation not a
  blank check to win at all costs
• Zealous is not the same as hostile or aggressive
• Often results in running up a bill the client is
  unable or unwilling to pay
• Balance duty to client with duty to legal system
  and duty to society

39
Common ethics issues (cont.)

• Filing non-meritorious cases
• Failure to adequate investigate facts
• Failure to develop a legal theory on which
  recovery may be obtained
• Sanctions can be levied against client, lawyer,
  or both
• Sanctioned client will often grieve or sue lawyer
  who gave bad advice

40
Common ethics issues (cont.)

• Communicating with adverse party represented by
  counsel
• Happens far too often in family cases
• Communicating ex parte with court or court
  staff
• Limit communication to procedural issues such as
  confirming court dates, etc.

41
Common ethics issues (cont.)

• Suppressing or sanitizing evidence
• Dont hide discoverable evidence or counsel
  clients to do so
• Dont alter or clarify documents

42
Foonbergs 10 Rules

1. Discuss fees and expectations with client at
   beginning of representation
2. Have written fee agreement
3. Bombard clients with paper (today, emailed PDF
   versions of paper)
4. Return all telephone calls promptly
5. Be open and honest with bad news for client

43
Foonbergs 10 Rules (cont.)

1. Hands-off clients money (no dipping into trust
   account before fee is earned)
2. Cooperate fully with substitute counsel when you
   are discharged
3. Respond immediately and completely to all
   disciplinary inquiries
4. Keep accurate time records
5. Read and understand your states ethical rules
   and interpretive opinions

44
If you violate the rulesTypes of Discipline in
FL - Rule 3-5

• Admonishment
• Only applies to Minor Misconduct
• Probation for 6 months to 3 years
• Professionalism Enhancement Program
• Supervision by another Bar member
• Restrictions on Advertising
• Public Reprimand
• Suspension
• Indefinite or Term of Up to 3 Yrs
• More Than 90 Days Requires Proof of
  Rehabilitation
• Disbarment

45
Minor Misconduct?

• Cannot involve misappropriation of client fund
• Many trust account violations will not be merely
  minor misconduct
• Cannot result in actual prejudice to a client
• Cannot include dishonesty, misrepresentation,
  deceit, or fraud
• Cannot constitute a felony
• Lawyer cannot have been disciplined in any way in
  past 3 years
• Lawyer cannot have been disciplined for same type
  of misconduct in past 5 years

46
If Suspended or Disbarred

• Must Send Notice to Clients, Opposing Counsel and
  Courts of the Disciplinary Decision
• Forfeiture of Fees
• Payment of Restitution
• Payment of Costs of Disciplinary Proceedings

47
Problem 7

• What law practice management techniques can be
  used to minimize the risk of a Bar grievance?