Bressler Risk Blog

“Why Documenting What You’re Not Retained to Do Can Be Important Too” —

• “In my experience, too many lawyers appear to be quite comfortable running with an assumption that their client’s understanding of what the scope of representation is aligns with theirs. This is one of the reasons why I suspect trying to convince lawyers to document scope of representation on all new matters is a never-ending task. Getting buy-in on documenting what one has been retained to do is hard enough. Now, I’m going to add to this advice a recommendation that lawyers should also be thinking about documenting what one has not been retained to do. It’s an uphill battle, I know; but it’s a battle worth fighting. Here’s an example of why.”
• “A nonprofit regularly reaches out to a plaintiff personal injury lawyer on behalf of clients of the nonprofit. After a family member was shot and killed by police, this nonprofit retained the lawyer for the purpose of gathering as much information about the shooting as he could, to include obtaining video footage of the shooting from the police department. The purpose was to provide the nonprofit’s client with information that would help her understand what led to the shooting. While the lawyer worked with the nonprofit’s client, the nonprofit paid his fee. Documentation of the lawyer’s role was minimal, consisting primarily of a few emails with both the nonprofit and its client, none of which properly addressed the issue other than to say he would take care of gathering information.”
• “…This is when things went off the rails. The nonprofit’s client reached out asking about the video and also raising concerns about what the recent running of the statute of limitations means for her case. Of course, in the lawyer’s mind he never agreed to pursue this claim. He viewed his role to be limited to information gathering. However, the nonprofit’s client appears to see it differently.”
• “The lawyer’s immediate concern was how his reputation might be damaged when the nonprofit’s client complains to the nonprofit. His fear was referrals might now go elsewhere. And then there’s the possibility of a grievance being filed and/or a malpractice claim, all for the want of proper documentation of his scope of representation.”

“Judge’s secret romance triggers courtroom conflict of interest” —

• “The failure of a Victorian judicial officer to disclose a secret personal relationship with a lawyer has been found to breach basic conflict of interest, but an investigating panel said the conduct is not serious enough to sack them.”
• “A panel of the Judicial Commission of Victoria (JCV) recommended that the judge not be kicked off the bench, despite their silence on an occasion when a lawyer they were romantically linked to appeared before them in court.”
• “The panel found the judge’s ‘personal and intimate relationship’ with the lawyer, and subsequent omissions about it during court proceedings, amounted to a conflict of interest. ‘The [judicial officer] failed to use the multiple opportunities when the prospect of an appearance arose to identify and respond to the potential issue. Instead, the officer promoted or condoned further appearances,’ a statement from the JCV said.”
• “The panel also said that when asked about the relationship and the failure to address the obvious ethical problem, the judge’s response tended to water down the significance of the conflict.”
• “The judge’s choices reflected poor-decision making, the panel said, and they must to attend at least one counselling session to ‘explore the stressors that contributed’ to this ethics breach.”
• “This latest JCV finding comes after another similar issue was addressed in the High Court about the relationship between a judge and barrister involved in a family court trail. That case has prompted the Australian Law Reform Commission to undertake a review of the laws on judicial impartiality and bias.”

Dentons Partners Shari L. Klevens and Alanna Clair remind us: “Watch Out for Risks When Moving Offices” —

• “As the practice of law adjusts to a post-pandemic world, many firms are evaluating their current office space and the lasting impact of the sudden transition to work-from-home over the last year. Because of anticipated changes to the office environment, some firms may look elsewhere for an office that better suits their needs.”
• “But a successful move requires overcoming numerous logistical challenges. Law firms may view the move as an opportunity to ‘clean house’ by discarding old or seemingly unneeded files that do nothing more than take up space. However, the decision to destroy files can be complex and may implicate the ethical obligations attorneys owe to their clients.”
• “If documents needed to protect client interests have been destroyed, the law firm risks not only the ability to defend against a legal malpractice claim brought by that client, but also may receive a bar grievance or other complaint for failing to take the steps necessary to surrender papers and property to which the client is entitled.”
• “This typically does not require law firms to maintain all records and papers indefinitely, however. Law firms can consider the costs associated with storing old files. For every law firm, the level of risk the firm is willing to take when disposing of old files versus the price it is willing to spend to keep them in storage will vary; there is rarely a one-size-fits-all solution to this issue.”
• “Generally, documents from closed files can be divided into three categories. The first category is documents, such as originals, that have special legal significance (wills, leases, contracts, etc.)… The second category includes documents subject to a “litigation hold” … The third category encompasses nearly all other documents… Those documents can be retained for the number of years required by state bar rules or until the statute of limitations for any legal malpractice claims has lapsed, whichever is greater.”
• “The ABA, in Informal Opinion 1384, identifies some additional considerations for attorneys deciding how long to hold onto materials or documents.”

ABA INFORMAL OPINION 1384: GUIDELINES FOR CLIENT FILE RETENTION/DISPOSITION —

• “Unless the client consents, a lawyer should not destroy or discard items that clearly or probably belong to the client. Such items include those furnished to the lawyer by or on behalf of the client, the return of which could reasonably be expected by the client, and original documents (especially when not filed or recorded in the public records).”
• “A lawyer should use care not to destroy or discard information that the lawyer knows or should know may still be necessary or useful in the assertion or defense of the client’s position in a matter for which the applicable statutory limitations period has not expired.”
• “A lawyer should use care not to destroy or discard information that the client may need, has not previously been given to the client, and is not otherwise readily available to the client, and which the client may reasonably expect will be preserved by the lawyer.”
• “In determining the length of time for retention or disposition of a file, a lawyer should exercise discretion. The nature and contents of some files may indicate a need for longer retention than do the nature and contents of other files, based upon their obvious relevance and materiality to matters that can be expected to arise.”
• “A lawyer should take special care to preserve, indefinitely, accurate and complete records of the lawyer’s receipt and disbursement of trust funds.”
• “In disposing of a file, a lawyer should protect the confidentiality of the contents.”
• “A lawyer should not destroy or dis pose of a file without screening it in order to determine that consideration has been given to the matters discussed above.”
• “A lawyer should preserve, perhaps for an extended time, an index or identification of the files that the lawyer has destroyed or disposed of.”

Interesting story from Canada: “Professional Negligence Claim Dismissed Against Lawyer Despite Conflict Of Interest And Breach Of The Standard Of Care” —

• “The plaintiffs, a husband and wife, sued their former lawyer, who had been disbarred by the time of the hearing. Their claim had nothing to do with allegations of missing trust funds or dishonesty which led to the lawyer being disbarred. Rather, it was a claim for professional negligence and breach of retainer.”
• “In mid-2011, the lawyer was asked to prepare documents in order to secure the outstanding loans from the plaintiffs. The lawyer prepared a General Security Agreement (GSA) over the assets of Maplesoft and registered the security under the Ontario Personal Property Security Act (PPSA). The plaintiffs were not directed to obtain legal advice, and the lawyer did not obtain written consent to the joint retainer or otherwise comply with the rules concerning conflicts of interest as required by Rule 3.4 of the Law Society of Ontario’s Rules of Professional Conduct.”
• “At first blush, it may have appeared that the plaintiffs had a strong claim. There was no doubt that their lawyer had acted in a conflict of interest and had failed to document the consent and instructions of his various clients. The lawyer admitted that he should have prepared a promissory note in 2011 in order to “paper the loan.” There was little doubt that the lawyer’s actions and omissions were careless and fell below the standard of care required of a reasonable and prudent lawyer in the circumstances of the retainer.”
• “None of this was sufficient, however, to establish liability for negligence. In that regard, the plaintiffs failed to show how the lawyer caused their alleged damages. Proof of loss is an essential element of an action for professional negligence. As stated by Justice MacLeod, “there can be no liability for negligence unless some consequential damage has been suffered by the plaintiff.”
• “Similarly, conflict of interest is not an independent cause of action without proof of damages resulting therefrom: Lacroix v. CMHC and McCann v. CMHC, 2016 ONSC 2641 (Div. Ct.)… it was not clear how the lawyer’s conflict of interest gave rise to any losses. The male plaintiff negotiated directly with the CEO of Maplesoft and there was no evidence that the plaintiffs had relied on the lawyer for business or financial advice. The male plaintiff had signed a release and subordination of security interest at Maplesoft’s request without seeking any advice from the lawyer before doing so.”
• “The decision affirms the principle that a finding of a breach of a duty of care or conflict of interest by a professional does not end the question of whether the professional was negligent or caused the plaintiffs any losses. Negligence requires proof of foreseeable damages that result from the alleged error or omission. Plaintiffs who focus on the alleged error or omission without taking steps to quantify and prove the damages that allegedly result therefrom may face a summary dismissal of their claim.”

“Christian Porter’s barrister discussed conflict of interest before taking ABC defamation case” —

• “Former attorney-general Christian Porter’s top barrister in his defamation case against the ABC has revealed she had key conversations about whether she should continue in the case while running on a treadmill in a Melbourne hotel.”
• “Sue Chrysanthou is being challenged over an alleged conflict of interest in the Federal Court, after she gave legal advice to someone linked to the allegations against Mr Porter before taking on his case.”
• “Mr Porter is suing the ABC over a story about an unnamed cabinet minister accused of a historical alleged rape. The article, published in February, did not name the attorney-general as the subject of the complaint, but Mr Porter’s legal team claim he was easily identifiable. He has strenuously denied the allegation.”
• “The hearing into Ms Chrysanthou’s alleged conflict of interest has been running for three days.”
• “It was also revealed that Mr Porter’s barrister had given some advice to Ms Dyer and others about a separate legal matter, before taking on Mr Porter’s defamation case. Ms Chrysanthou gave evidence at the hearing today and told the court she initially hesitated before taking Mr Porter’s case. ‘I said ‘I have to check, because of a conference I had,’ Ms Chrysanthou told the court. She also confirmed her junior solicitor told her taking the case was a bad idea. But Ms Chrysanthou said she took advice from more senior lawyers and decided there was not a problem.”
• “Ms Chrysanthou did agree there might be a question about whether the information Ms Dyer gave to her in the meeting was confidential or not, but said she accepted legal advice that said that was not an issue.”
• “She said she discussed an undertaking not to cross-examine Ms Dyer or another witness with instructing solicitors and possibly Mr Porter, while she was on a treadmill in a Melbourne hotel.”
• “During the three-day hearing into the alleged conflict of interest, the court has been closed several times while the confidential material said to have been exchanged between Ms Chrysanthou and Ms Dyer was discussed.”

“Gunster Out: Miami Judge Disqualifies Shareholder and Law Firm in Insurance Suit” —

• “The Miami-Dade Circuit Court has approved a motion to disqualify a statewide law firm and one of its shareholders from multi-year insurance litigation.”
• “Anthony V. Alfieri, the founder and director of the Center for Ethics and Public Service at the University of Miami School of Law, is not involved in the case. But Alfieri said Miller’s decision will be required reading for teachers of legal malpractice and law firm management, and for courts and practitioners in the field.”
• “‘Putting aside the prominence of the litigation teams and the widely respected expert witness Robert M. Klein, the decision [full text here] stands out not only because of its wide-ranging analysis of Florida ethics rules governing conflicts of interest (4-1.7, 4-1.8, and 4-1.9), and mandatory withdrawal (4-1.16), but also because of its vigorous application of the Daubert standard for expert testimony,’ Alfieri stated in an email Tuesday. ‘Equally important, the decision addresses both the doctrine of waiver and appearance of impropriety standard.'”
• “Part of the issue is that the law firms represent more than 80 insurance companies, including USAA Casualty Insurance Co. and USAA General Indemnity Co., who are the defendants in this underlying action.”
• “The law firms have argued since October that Ruiz did not have standing to raise issues primarily based on the conflict of interest arguments. But after multiple hearings, Miller denied motions to dismiss the disqualification motions.”
• “An appeal to Florida’s Third District Court of Appeal also proved futile, court documents show. And after Miller held an evidentiary hearing, the circuit court ruled that Gunster and one of its shareholders, Angel A. Cortinas, a former Third DCA judge, should be disqualified from the litigation in the circuit court.”
• “Now, Miller ruled in the order that Gunster and Cortinas also cannot represent Akerman and Greenberg in the appeal of the circuit court order, finding that the law firm and Greenberg had a conflict of interest, and that they failed to produce information and data they were legally required to produce.”
• “‘The impact of the defendants’ actions are enormous,’ Ruiz said. ‘These lawyers and their clients have to think long and hard how they are representing multiple parties that have conflicts of interest with each other and it’s all to the detriment of the Medicare trust fund.'”