Terminating the AC

15 important questions on Terminating the AC

Generally Cs can fire Ls for any reason. What is the biggest exception?

Whistle-blowing, in-house Ls.

Since in-house Ls are also an employee of the entity, they might be covered by employment laws that protect ordinary employees who whistle-blow (protected from retaliatory discharge for brining safety/regulatory concerns to management's attention)

A C may issue that a L is looking after C's affairs in cases where the L thinks that the R has terminated. ABA provision (comment)

1.3, CMT 4.

Affect of ongoing R, unbeknownst to L

As long as the R continues, L is required to (1) communicate relevant info to C, (2) rep C diligently, and (3) refrain from representing conflicting interests.
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Which professional duty extends beyond termination of A-C R?

The PDC continues beyond termination of the AC-R. 1.6, CMT 18.

A reasonable person would believe the AC-R is ongoing where?

  • L continues to send marketing materials ("current developments in law" newsletters) to C
  • L retains important documents of C (corporate minute books)
  • C pays any bills that L sends

A reasonable person might believe the AC-R has terminated where?

  1. C has refused to pay a big and L has not followed up to collect
  2. C hired another L, and L1 knows that.

The Hot Potato Doctrine

Prohibits Ls from discharging Cs just so sthey can be in a position to take on a more lucrative rep of another C, which would otherwise be prohibited by the CoI Rules.

RLE: L cannot terminate the rep prior to what the parties considered to be, ex ante, the natural completion of the matter. Any purported termination by L will be considered ineffective, and the multiple rep will be analyzed as a current-C conflict (1.7, 1.7).

What does ABA 1.16(d) require

L must take steps to minimize the harm to C resulting from withdrawal - including (1) giving notice to C, (2) allowing time for C to secure substitute counsel, and (3) returning papers + property that belong to C.

ABA Rs on L's ongoing duties to former Cs? 2 Rs

1.6 and 1.9

Issue Spot: Whether AC-R is ongoing

Lookout for facts that makes the C's subjective belief in an ongoing professional relationship either reasonable or unreasonable

Facts tending to support a C's reasonable belief in an ongoing relationship?

  • A long history of using the same L or law firm
  • Sending promotional materials or "dear friend" letters
  • retention of client documents
  • a relatively short interval between the last legal work performed and the time in which the L seeks to represent a new C with adverse interests [for purposes of former-C conflicts under 1.9(A).

1.18(b). Duties to prospective C?

At the moment the prospective C consults with a L, the L acquires an obligation to keep confidential any information learned in the course of the consultation. 1.18(b).

1.18(c) - Prospective C Conflicts

Even if a prospective C decides not to retain L, L is personally disqualified from representing a new C whose interests are materially adverse to those of the former C in the same or a substantially related matter if L obtained information that could be significantly harmful to the prospective C.

1.18(d) - Screening + Prospective Client

The prospective C rule permits the firm too crest he L who conducted the interview from other Ls in the firm. 1.18(d). If the personally disqualified is effectively screened, following the procedures in 1.18(d), other Ls in the firm may represent a new C whose interests are materially adverse to those of the prospective C, in the same or a substantially related matter.

Avoiding 1.18(c) Prospective C Conflicts?

In order to avoid personal disqualification--1.18(d) screening will not be required---Ls conducting interviews with prospective Cs should obtain waivers of confidentiality and conflicts of interest from the prospective C. NYC Bar Forma Op. 2006-2. However, if there is effective 1.18(d) screening, other Ls in the firm may undertake subsequent adverse representation of other Cs even if the interviewing L does not obtain waivers of confidentiality and conflicts.

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