November 20, 1989
A lawyer may not represent a client in an action which, if successful, will result in liability in whole or in part of the lawyer's partner.
References: MRPC 1.7, 1.15, 8.4; RI-25.
A lawyer was a partner in a firm until mid-1986, at which time the lawyer practiced alone briefly, and then took on a partner in November of 1986. The lawyer has been advised that clients of the former firm, who were not clients of the lawyer, have alleged another partner converted their funds. The same partner may be the subject of other conversion claims, which may or may not be for a period of time when the lawyer was with the former firm.
The lawyer's current partner has been asked to represent the claimant. The lawyer and the current partner ask whether the representation is proper.
The Committee has no jurisdiction to render opinions on questions of law, and thus does not determine whether the lawyer is legally liable for the conversion of a partner; nor does the Committee decide whether the lawyer will be free of liability since the claim was raised after the lawyer left the firm.
MRPC 1.7(b) states:
"(b)A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person, or by the lawyer's own interests, unless:
"(1) the lawyer reasonably believes the representation will not be adversely affected; and
"(2) the client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved."
If the current partner's own interests, or duty to a third person, would materially limit representation of the claimant, then the representation cannot be undertaken unless paragraphs (1) and (2) are followed.
We do not construe the lawyer's partnership agreement, but we consider it normal for a partnership to impose mutual duties on the partners for the enrichment of the partnership. Although it could be argued that successful representation in this matter will financially benefit the current partnership, the current partner's success will be at the expense of the former firm. If the lawyer is legally liable for the acts of the former partner, success by the current partner will adversely affect the lawyer.
More directly, the charge of conversion entails violations of ethics rules MRPC 1.15, 8.4(a), (b) and (c), and may be criminal. If the lawyer is liable for the acts of the former partners, the lawyer would be equally responsible for the ethical improprieties, and may be disciplined. A suspension or disbarment clearly impacts the current partner's own interests in preserving the partnership.
It should be noted that if the alleged misconduct occurred after October 1, 1988, MRPC 5.1 would place a burden on all partners of the former firm to show efforts taken to ensure firm member compliance with the rules. There is no comparable rule for partners' responsibility under the old Code of Professional Responsibility.
Since we have concluded that the current partner's own interests and duties to the partnership will materially affect the representation of the claimant, we now look to whether paragraphs (1) and (2) are satisfied.
We have said before that the standard to be applied under (1) is whether a disinterested lawyer would reasonably believe the representation would not be adversely affected. In RI-25 we held that when one member of a firm is being sued for malpractice, the firm may only continue to represent the complainant in other pending litigation if the client consents, and only if the firm lawyers have individually made determinations that the representation of the client will not be adversely affected, utilizing the standard of a disinterested lawyer examining the circumstances.
We fail to see how this representation will not be adversely affected by the current partner's conflicting interests using the standard, and a disinterested lawyer would be hard-pressed to conclude that the client should agree to the representation under the circumstances.