Opinion ID: 835777
Heading Depth: 1
Heading Rank: 2

Heading: former client conflict

Text: The Bar also alleges that the accused violated DR 5-105(C) by first representing the husband in a divorce proceeding and later representing the wife in the same divorce proceeding and in a proceeding to overturn a related restraining order. On de novo review, we conclude that the Bar proved the following facts by clear and convincing evidence. On October 4, 2000, Richard Grossman, who was seeking to replace his existing lawyer in a divorce proceeding, met with the accused to discuss representation. Richard asked whether the consultation was confidential, and, although the accused did not provide Richard a direct answer, he did not disabuse Richard of that understanding. [6] Richard provided a copy of a property settlement agreement that he and his wife Linda had signed, and he described the main issues in the divorce, including whether Linda could share an annuity that he had purchased after the couple had signed a postnuptial agreement. Richard also told the accused about his goals in the divorce proceeding. Although Richard was seeking representation only in the divorce proceeding, he also told the accused about the history of Family Abuse Prevention Act restraining orders involving the parties. Richard previously had obtained a restraining order against Linda. At the time Richard consulted the accused, Linda had obtained a restraining order against Richard. The petition that had been the basis for the latter restraining order alleged that Richard had shoved and threatened Linda during a public argument on August 13, 2000. However, Richard described to the accused a different version of those events, saying that Linda had been the aggressor, yelling and screaming at Richard and his female companion and preventing Richard from getting into his car and leaving. Richard told the accused that he believed Linda had sought the restraining order as a defense to a stalking complaint that his companion had filed against Linda. Richard told the accused that Linda had broken into his home sometime after the August 13 incident and that he was concerned because he believed that the police were not being responsive. He said that he was considering obtaining another restraining order against Linda. On October 12, the accused wrote to Richard expressing a desire to represent him in the divorce proceeding. In a subsequent telephone conversation, however, Richard told the accused that he had decided to retain another lawyer, Urrutia. The accused sent Richard a bill for the October 4 consultation, but Richard never paid it. On November 21, Richard filed a pro se petition seeking a restraining order against Linda and citing the August 13 incident and the break-ins, among other incidents that had occurred in the prior 180 days. The court issued the order on November 22. Richard did not know, at the time that he filed the petition for a restraining order, that Linda also was seeking a new lawyer because she was dissatisfied with her existing lawyer. On November 30, Linda interviewed the accused, discussed the divorce and restraining order proceedings with him, and retained him to represent her in both those matters. The accused never discussed with Linda the fact that he had consulted with Richard. Over the next few days, the accused took affirmative steps in connection with his representation of Linda. He wrote to Linda's previous lawyer to request Linda's file, wrote to Urrutia to notify him of the representation and discuss the scheduling of discovery, and requested a hearing to contest the restraining order. He also wrote to Urrutia to request that Linda be allowed to attend a class at Portland Community College (PCC), a location that the restraining order barred her from visiting. On December 4, Laney, an associate of Urrutia's, notified the accused that he had a conflict in representing Linda because he had consulted with Richard previously. They discussed the propriety of the representation by fax and telephone. Laney requested that the accused withdraw from representing Linda in the divorce proceeding because he had a conflict of interest as a result of his prior consultation with Richard. The accused said that he did not remember speaking to Richard. However, the accused did not check any records that might have refreshed his recollection. Laney sent the accused a copy of the accused's October 12 letter to Richard as evidence of the meeting. The accused responded by faxed letter that he still did not remember Richard but that he would discuss the issue with his ethics counsel. During their communications on December 4, Laney and the accused also continued to discuss whether Linda could go to PCC. Laney said that the couple might meet there, and that Richard would consider any contact with Linda, however accidental, a violation of the restraining order. The accused said that he intended to contest in court whether Linda's college attendance violated the restraining order. On December 5, Laney asked the accused to decide promptly whether he would continue to represent Linda, because a hearing in the divorce proceeding was approaching. The accused responded that he would be meeting with his ethics counsel that day, but he refused to withdraw until after that meeting. On December 6, the accused informed Urrutia that he would withdraw from representing Linda in the divorce proceeding. He withdrew from the divorce representation on December 8, but he did not withdraw from the restraining order proceeding. Urrutia confirmed the divorce withdrawal by letter, noting that the accused was still undecided as to whether he would withdraw from the restraining order matter and requesting that he do so. The accused consulted his ethics counsel a second time. On December 12, he informed Linda that he was withdrawing from that matter as well, and arranged for Linda's previous attorney to resume representing her. Urrutia, who was unaware of the change, threatened to file a motion to disqualify the accused in the restraining order proceeding. On December 18, the other attorney told Urrutia that the accused had withdrawn. The Bar's complaint charged the accused with violating DR 5-105(C). That provision provides: Former Client Conflicts  Prohibition. Except as permitted by DR 5-105(D) [regarding consent by both parties after full disclosure], a lawyer who has represented a client in a matter shall not subsequently represent another client in the same or a significantly related matter when the interests of the current and former clients are in actual or likely conflict. Matters are significantly related if either: (1) Representation of the present client in the subsequent matter would, or would likely, inflict injury or damage upon the former client in connection with any    matter in which the lawyer previously represented the former client; or (2) Representation of the former client provided the lawyer with confidences or secrets as defined in DR 4-101(A), the use of which would, or would likely, inflict injury or damage upon the former client in the course of the subsequent matter. When evaluating whether a lawyer has violated DR 5-105, we consider all facts that the lawyer knew, or by the exercise of reasonable care should have known. DR 5-105(B). The trial panel found that Richard had been the accused's client and that Richard's interests were in conflict with Linda's. It also found that the accused either knew or should have known of that conflict when he met with Linda for the first time and that the conflict was so obvious    that no consultation [with ethics counsel had been] required on either the restraining order or the divorce proceedings, which were inextricably intertwined. The trial panel held that the Accused's failure to recognize the conflict when he undertook to represent [Linda] in both the divorce and [restraining order] matters and his failure to withdraw in a timely manner in both matters when being alerted to the conflict, constitute a violation of DR 5-105(C). The accused argues on review that DR 5-105(C) does not apply to this proceeding because that rule applies only to a conflict between a current client and a former client, and that Richard was not a former client of the accused. In the accused's view, Richard was, at most, a prospective client of the accused who never became an actual client and, therefore, cannot be a former client. The Bar, relying on OEC 503 and this court's decision in In re Spencer, 335 Or. 71, 58 P.3d 228 (2002), argues that this court should construe the word client in DR 5-105(C) to include anyone who consults with a lawyer with a view to obtaining professional services from the lawyer. In the Bar's view, Richard was the accused's client for purposes of the former client conflict prohibition of DR 5-105(C), even though he did not retain the accused. For the reasons that we discuss below, although we disagree with the Bar's broad reading of the word client in DR 5-105(C) to include anyone who consults with a lawyer with a view to retaining legal services, we conclude that, in this proceeding, the Bar has proved by clear and convincing evidence that Richard was a client of the accused's, at least briefly, and, therefore, that he also was a former client for purposes of DR 5-105(C). In Spencer, this court considered whether the requirement in DR 9-101(C)(4) that lawyers promptly    deliver to a client as requested by the client    properties in the possession of the lawyer which the client is entitled to receive applied to prospective clients. This court noted that OEC 503 extends the lawyer-client privilege to persons who consult a lawyer with a view to obtaining professional legal services from the lawyer, Spencer, 335 Or. at 83, 58 P.3d 228, and concluded that, when a person delivers documents to a lawyer who is considering whether to represent that person, the person has entrusted those materials to the lawyer as a lawyer and, as such, is as much entitled to be considered a `client' for that limited purpose as if the person had made a confidential, verbal communication to the lawyer. Id. at 84, 58 P.3d 228. As noted previously, the Bar argues that Spencer and OEC 503 support its argument that anyone who consults with a lawyer with a view to obtaining legal services should be considered a client for conflict of interest analysis under DR 5-105. On the contrary, in Spencer this court specifically declined to treat all prospective clients as clients for purposes of the disciplinary rules and limited its interpretation of client there to the use of that term in DR 9-101(C)(4). 335 Or. at 84-85 and n. 9, 58 P.3d 228. Spencer does, however, recognize that this court will consider as evidence that a person is a client for purposes of the disciplinary rules whether the putative client intended to establish a lawyer-client relationship and whether the putative client could assert the lawyer-client privilege under OEC 503 as to communications with the lawyer. Id. at 84, 58 P.3d 228. We now turn to the evidence in the record to determine whether Richard ever was a client of the accused for purposes of DR 5-105(C). As described above, Richard consulted the accused for approximately two hours concerning representation in his divorce. The accused provided Richard substantive advice on various aspects of the divorce proceeding. Richard reasonably believed that the consultation was confidential, and the accused also believed that it was confidential. Richard expected to be billed for his consultation with the accused, and the accused in fact sent him a bill. Richard also discussed with the accused the factual details regarding the restraining orders. The accused provided Richard with legal advice concerning the evidence a court would require from Richard before he could obtain such an order. The accused never told Richard that he was not the accused's client, that Richard should avoid disclosing confidential information, or that the creation of a lawyer-client relationship would be deferred until some later date. Although Richard ultimately decided not to retain the accused to appear on his behalf in the divorce proceeding (or in connection with the restraining orders), we conclude that the Bar has proved by clear and convincing evidence that Richard was a client of the accused for purposes of DR 5-105, at least during their consultation on October 4, 2000. The accused identifies certain evidence that, he asserts, supports his view that Richard was only a prospective client, including correspondence from Urrutia and Laney to the accused that refers to the accused's potential representation of Richard. The accused is correct that some evidence in the record supports his claim that Richard was a prospective client; however, as we have determined, clear and convincing evidence in the record supports our conclusion that Richard was a client. The accused also correctly points out that Richard never affirmatively retained the accused to represent him as trial counsel in the divorce proceeding. The lawyer-client relationship, however, is not as narrow as the accused suggests, and a lawyer-client relationship may be  and often is  limited to office consultations in which a client seeks, and the lawyer gives, legal advice. The conflicts rules protect clients who seek and obtain such advice as much as they do clients who retain lawyers to represent them in court proceedings. Because Richard was the accused's client for a time, when Richard decided to retain another lawyer instead of the accused, and so informed the accused, Richard became a former client of the accused for purposes of DR 5-101(C). [7] DR 5-105(C) prohibits a lawyer who has represented a client in a matter from representing a subsequent client in the same matter, when the two clients' interests are in actual or likely conflict. An actual conflict exists when the lawyer has a duty to contend for something on behalf of one client that the lawyer has a duty to oppose on behalf of another client. DR 5-105(A)(1). The accused represented Richard in connection with the divorce proceeding. He subsequently represented Linda in the same proceeding. By representing Linda, the accused assumed a duty to advocate for her financial interests in the distribution of the marital estate  a duty diametrically opposed to his obligations when he had advised Richard in connection with the divorce. We conclude that the Bar has proved by clear and convincing evidence that the accused had an actual conflict of interest in representing Linda in the divorce. The accused contends that he actually did not represent Linda in the divorce because he undertook no actions on her behalf. We reject that argument because we find, as a factual matter, that the accused did take such actions, including but not limited to several meetings in which he advised Linda on the appropriate legal strategy in the divorce. The Bar also contends that the accused violated DR 5-105(C) by representing Linda in the proceeding concerning the November 2000 restraining order that Richard had obtained against her. According to the Bar, that violation occurred because the order was significantly related to the divorce. DR 5-105(C) prohibits a lawyer who has represented a client from representing a subsequent client on a significantly related matter when the two clients' interests are in actual or likely conflict. That rule provides that a subsequent matter is significantly related to an earlier matter when, in part, the representation of the former client provided the lawyer with confidences or secrets, as defined in DR 4-101(A), the use of which would, or likely would, inflict injury or damage upon the former client in the course of the subsequent matter. [8] The accused received confidences and secrets from Richard. As described above, Richard shared his version of the facts underlying the restraining order that Linda obtained against him. He also discussed additional incidents in which he believed Linda had threatened him and possible grounds for obtaining a restraining order against her. Richard later based his petition for a restraining order against Linda on some of the same facts. Richard also discussed with the accused Linda's motivation for obtaining her restraining order against him and his motivation for obtaining a restraining order against her. Those views likely would have been important to Richard's prosecution of his petition for a restraining order and his responses to Linda's defense. As previously noted, both Richard and the accused believed that the consultation was confidential, and the accused understood that his conversation with Richard was covered by the lawyer-client privilege. The Bar does not claim that the accused used the confidences communicated to him by Richard in his representation of Linda. However, DR 5-105(C)(2) requires only that the accused could have used them in a way that would have been likely to harm Richard, and we find that requirement met here. We conclude that the accused's representation of Linda in connection with the restraining order that Richard sought against her was significantly related to his earlier representation of Richard. The interests of Richard and Linda were in actual conflict in that matter because Richard sought to obtain and sustain a restraining order that Linda sought to overturn. The accused therefore violated DR 5-101(C) by representing Linda in the restraining order matter. The accused argues that he should not be deemed to have violated DR 5-105(C) because he had ended the representation as soon as possible after he had discovered the conflict and consulted with ethics counsel. He contends that finding a violation here is inappropriate because it would discourage lawyers from consulting ethics counsel in the future. We disagree. The accused should have known of the conflict before he began representing Linda; he did not because he had no real procedure for checking for conflicts. The accused did not conduct routine conflicts checks to determine whether the representation of a potential new client might present a conflict. He kept a client address list, to which he added the names of potential clients if he thought that they might become clients. That file contained Richard's name. Indeed, the accused not only placed Richard's name on that list, but also opened a file, which included documents, correspondence, and the bill that he sent Richard. However, the accused checked his list or other files only when his memory alerted him to a potential problem. According to his testimony, he did not check his client list when Linda consulted him or before agreeing to represent her. Clearly, he should have. In our view, a lawyer in the accused's situation may not rely solely on his or her memory to avoid prohibited conflicts of interest. If the accused had established and used a more reliable procedure, then he would have known of his prior consultation with Richard and would have been able to consult with ethics counsel before he met with Linda. The accused emphasizes the benefits to the public and to the bar if lawyers consult with ethics counsel when faced with a possible conflict, and we encourage that sort of consultation. However, in contrast to complex transactions or cases involving numerous parties and close questions of whether parties' interests may be adverse, this was a straightforward, if contentious, divorce proceeding (with related restraining order disputes) between two people who had the same last name. We agree with the trial panel that the conflict here should have been obvious to the accused and should have caused the accused to decline to represent Linda when he first met with her.