Types of Legal Malpractice Conflicts of Interest
A lawyer owes his undivided loyalty to his client. The ethics rules governing lawyers make this very clear. But, sometimes a lawyer's interests are in conflict with his client's.
When this happens, and it negatively affects a client, the conflicted lawyer should be made to pay. hde
Some lawyers go into business with their clients, something which the ethics rules discourage. There are several things lawyers have to do if they want to be partners with their clients, and they can be sued if the venture fails. While not all business ventures with cheats are technically a conflict of interest, the Supreme Court has warned lawyers repeatedly of the dangers.
Lawyers often know the intimate details of their client's lives, especially their finances. Lawyers often have the trust of their clients. Some lawyers may then use that trust and insight to get their clients to invest in businesses that benefit the lawyer.
I have fought against this kind of abuse of trust. The attorneys in that case did legal work for the pensions of small businesses. They used their knowledge about those pensions to get their clients to invest $30 million in an insurance company started and controlled by the attorneys.
The company quickly failed and the clients lost all the money they invested. The legal malpractice case which followed was especially hard-fought; the attorneys did not see themselves as having acted as attorneys when they convinced their clients to invest. The jury and the court felt otherwise.
The law firm was so certain that it had not committed a conflict of interest that even after losing the trial it refused to pay the award. The firm was forced to the brink of being closed down like any other debtor that would not pay its debts before it finally agreed to pay.
Other conflicts of interest cause malpractice cases. A lawyer may want to settle a case or just end it because he is not getting paid. A lawyer may know that he has made a mistake and try to cover it up, failing to tell his client.
Lawyers may sometimes have competing interests, favoring one client over another. For example, when business partners get into a dispute, a lawyer who has represented them both may side with the one who will end up with the business. A lawyer who represented a husband and wife may later be asked by one to take on the divorce case.
Quite simply, a lawyer does wrong when he violates a duty of loyalty by changing sides and using confidential information learned when he represented the person he is now suing. I am handling several cases about just such a conflict.
Types of Legal Malpractice Conflicts of Interest
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