Inside Track: Ethical Dilemma: What Conflicts Are Left Behind When a Lawyer Leaves a Firm?:

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  • February
    19
    2020

    Ethical Dilemma: What Conflicts Are Left Behind When a Lawyer Leaves a Firm?

    When a lawyer leaves a firm, what conflicts does the lawyer leave behind? Turns out, it may depend on the firm's file retention policy.

    Timothy J. Pierce

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    Feb. 19, 2020 Lawyers come and go from firms on a regular basis. How can the firm determine if they have a conflict arising from the work of a departed lawyer?

    Question

    I have been asked to represent a husband in a divorce in which custody is an issue. I ran a conflicts check and it turns out that another lawyer in the firm represented the husband’s former wife in a divorce from a different man several years ago, which involved children.

    Tim Pierceorg tpierce wisbar Tim Pierce is ethics counsel with the State Bar of Wisconsin. Reach him by org tpierce wisbar email or through the Ethics Hotline at (608) 229-2017 or (800) 254-9154.

    I know that the lawyer who represented the wife could not represent the husband because it would be a conflict, but that lawyer left our firm two years ago, and I had nothing to do with the representation of the former wife.

    If the lawyer who formerly represented the wife is no longer with the firm, may I now represent the husband in the current divorce?

    Answer

    SCR 20:1.10 governs imputation of conflicts within a private law firm and states in relevant part that “(w)hile lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by SCR 20:1.7 or SCR 20:1.9.”

    Because the lawyer who represented the former wife would be prohibited by SCR 20:1.9(a) from representing the husband in the divorce, if that lawyer were still associated with the firm, the entire firm would be conflicted out.1

    But what happens when that lawyer is no longer associated with the firm?

    SCR 20:1.10(b) states:

    (b) When a lawyer has terminated an association with a firm, the firm is not prohibited from thereafter representing a person with interests materially adverse to those of a client represented by the formerly associated lawyer and not currently represented by the firm, unless:

    (1) the matter is the same or substantially related to that in which the formerly associated lawyer represented the client; and

    (2) any lawyer remaining in the firm has information protected by SCR 20:1.6 and SCR 20:1.9(c) that is material to the matter.

    If it is assumed that no other lawyer remaining with the firm assisted the departed lawyer on the representation of the wife, and there were no significant discussions of the matter among the lawyers in the firm, no lawyer remaining in the firm would personally have information relating to the representation of the former client, and thus is protected by SCR 20:1.6 and SCR 20:1.9(c).

    Further inquiry is, however, necessary. Comment c(I) to §124 Restatement (Third) of the Law Governing Lawyers further explains;

    c(i).Personally prohibited lawyer terminates the affiliation.During the time that a personally prohibited lawyer is associated with another lawyer, law firm, or other organization to which prohibition is imputed under§ 123, the lawyer could reveal confidential information to any other lawyer within the organization. Accordingly, imputed prohibition of all lawyers in the firm is appropriately required by§ 123. However, after the personally prohibited lawyer has left the firm, an irrebuttable presumption of continued sharing of client confidences or continued disloyalty induced by the affiliation is no longer justified.

    The lawyers remaining in the affiliation may rebut the presumption that confidential information was shared during the period of actual affiliation. They have the burden of persuasion concerning three facts: (1) that no material confidential client information relevant to the matter was revealed to any lawyer remaining in the firm; (2) that the firm does not now possess or have access to sources of client confidential information, particularly client documents or files; and (3) that the personally prohibited lawyer will not share fees in the matter so as to have an interest in the representation.

    (emphasis added)

    Therefore, the firm must determine whether it is still in possession of the file – whether in physical or electronic format – relating to the prior representation of the wife. If the firm is still in possession of the file (or any other information relevant to the matter) the firm would be conflicted out of the representation of the husband unless the written and signed informed consent of both the current and former clients were obtained.

    Part of a firm’s obligation under SCR 20:1.16(d) to protect the interests of clients upon termination of the representation is preserving closed client files for a reasonable period of time after the conclusion of the representation.2 The obligation to preserve closed files does not last forever, however, and one of the consequences of following a reasonable file retention policy is that conflicts arising from the firm’s former lawyers may eventually be removed.

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    Endnotes

    1 Pursuant to SCR 20:1.9(a), lawyers will have a conflict when the interests of a new client are materially adverse to the interests of a former client and the matters are substantially related. Here, because both the former and current representations involve custody, the matters are substantially related. Former client conflicts are subject to the written and signed informed consent of the both the current and former client.

    2 See Wisconsin Formal Ethics Opinion EF-17-01.




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