Can a firm that sues an insurance company for plaintiffs also defend that same insurer in other cases?

Plain-English summary

A lawyer in a firm with a substantial plaintiffs' personal injury practice, which also defended insurance companies to some extent, asked whether the firm could defend a particular insurance company in a number of personal injury cases while at the same time representing plaintiffs in other personal injury cases against that same insurer, with the full knowledge and consent of both the plaintiffs and the insurer.

A majority of the committee concluded the multiple representation would not be permissible. Under DR 5-105, a lawyer must decline employment if his independent professional judgment is likely to be adversely affected, except as permitted by DR 5-105(C), which allows multiple representation only if it is obvious the lawyer can adequately represent each client and each consents after full disclosure of the possible effect on the lawyer's judgment. The majority found that judgment would likely be adversely affected, for example in advising a plaintiff on a proper settlement sum in a suit against the firm's regular insurer client, and that it would not be "obvious" the lawyer could adequately represent each, so consent could not cure the conflict. The committee invoked EC 5-1, EC 5-2, EC 5-14, and EC 5-15 on undivided loyalty and resolving doubts against multiple representation, cited Opinion 65-13 and ABA Formal Opinion 112 on not opposing a current client even in unrelated matters, and noted the Canon 9 appearance-of-impropriety concern. The opinion carefully limited itself to the situation presented and expressly did not address past or future employment by the insurer, a lawyer regularly employed by two insurers where one sues the other, or situations where the plaintiff's lawyer could not have known the defendant's carrier before suit. A minority disagreed for several divergent reasons.

Currency note

This opinion was issued in 1977, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. It applied the former Code of Professional Responsibility, which has since been replaced. Treat this page as historical context, not current guidance. Verify against current Rule 4-1.7 before relying on any specific requirement mentioned here.

Common questions

Q: Can a firm sue an insurer for some clients and defend it for others at the same time?

A: The opinion concluded a firm with a substantial plaintiffs' practice against a particular insurer may not simultaneously defend that insurer in like cases in the same area.

Q: Does client and insurer consent fix the problem?

A: Per the opinion, no; the majority found it would not be obvious the lawyer could adequately represent each, so DR 5-105(C) consent could not render the representation permissible.

Q: How far does the opinion reach?

A: The committee limited the opinion to the specific situation, expressly declining to address past or future employment by the insurer, two-insurer cross-claims, or cases where the plaintiff's lawyer could not learn the defendant's carrier before suit.

Background and rules framework

The opinion applied DR 5-105 (declining or continuing employment that impairs independent judgment), the EC 5 series on undivided loyalty, and Canons 7 and 9 of the former Code of Professional Responsibility. That subject corresponds to Model Rule 1.7 (concurrent conflicts, including directly adverse representation of a current client); the current Florida counterpart is Rule 4-1.7.

Citations and references

Rules of Professional Conduct (as cited, former Code):

• CPR Canon 7; Canon 9; EC 5-1; EC 5-2; EC 5-14; EC 5-15; DR 5-105(C)

Other opinions cited:

• Florida Bar Opinion 65-13; ABA Formal Opinion 112

See also

• FL Bar Ethics Op. 76-2: Insurer's Lawyer Cannot Represent Claimant
• FL Bar Ethics Op. 75-33: Firm Adverse to City Client

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-75-17/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-75-17-1.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

FLORIDA BAR ETHICS OPINION
OPINION 75-17
May 31, 1977
Advisory ethics opinions are not binding.
A firm that engages in a substantial amount of personal injury litigation for plaintiffs against a particular insurance company is prohibited from simultaneously defending the same insurance company against other plaintiffs in the same kind of cases in the same geographical area.
CPR: Canon 7, Canon 9; EC 5-1, EC 5-2, EC 5-14, EC 5-15; DR 5-105(C);
Opinions: 65-13; ABA Formal 112
Vice Chairman Lehan stated the opinion of the committee:
The inquiring attorney is a member of a firm which engages in a substantial amount of personal injury litigation on the plaintiff's side and also represents insurance companies on the defense side to some extent. He asks whether it is permissible for his firm to represent a particular insurance company by defending that company in a number of personal injury cases at a given time and, at the same time, represent the plaintiffs in other personal injury cases against that same insurance company, with the full knowledge and consent of both the plaintiffs and the insurance company as to such multiple representation.
The majority of the Committee is of the opinion that such multiple representation would not be permissible under the Code of Professional Responsibility.
DR 5-105 provides that a lawyer shall "decline proffered employment if the exercise of his independent professional judgment in behalf of a client will be or is likely to be adversely affected by the acceptance of the proffered employment, except to the extent permitted under DR 5-105(C)." Subsection (C) of DR 5-105 provides that a lawyer may represent multiple clients "if it is obvious that he can adequately represent the interest of each and if each consents to the representation after full disclosure of the possible effect of such representation on the exercise of his independent professional judgment on behalf of each."
In the view of the Committee majority, the independent professional judgment of a lawyer representing multiple clients under the circumstances referred to in the inquiry would likely be adversely affected. Such adverse effect may relate to the attorney's judgment on behalf of personal injury plaintiffs who are suing the attorney's insurance company client who provides regular employment for the attorney.
Also, regarding Subsection (C) of DR 5-105, it would not be "obvious" that the lawyer can adequately represent the interest of each client under various possible circumstances; for example, circumstances involving the exercise of the attorney's judgment on behalf of a personal injury plaintiff as to a proper settlement sum in a suit against the attorney's regular insurance company client. Accordingly, the consent of each client, the plaintiff and the insurance company defendant, would not appear to render that type of multiple representation permissible. Parenthetically, it is noted that full knowledge and consent of the plaintiff and the insurance company as to the attorney's multiple representation would not fulfill the consent requirements of subsection (C) of DR 5-105 unless there has been also full disclosure of "the possible effect of such representation on the exercise of his independent professional judgment on behalf of each."
EC 5-1 provides that the professional judgment of a lawyer should be exercised "solely for the benefit of his client and free of compromising influences and loyalties" and that the interests of other clients should not be permitted "to dilute his loyalty to his client." EC 5-2 provides that a lawyer who has accepted employment should refrain from assuming a position "that would tend to make his judgment less protective of the interests of his client." EC 5-14, in requiring a lawyer's maintenance of his independence of professional judgment on behalf of a client, precludes employment which will "adversely affect his judgment on behalf of or dilute his loyalty to a client" whether the interests are "conflicting, inconsistent, diverse or otherwise discordant." EC 5-15 provides that in instances of prospective representation of multiple clients having "potentially differing interests" the lawyer "should resolve all doubts against the propriety of the representation."
Opinion 65-13 concluded that under the Canons of Professional Ethics the interests of the profession and the public are best served if a lawyer does not act as attorney for one person in a litigated matter while concurrently acting as attorney for the first client's adversary in another litigated matter, even though the matters are unrelated and even in the absence of pertinent confidential communications. As is stated in ABA Formal Opinion 112, a lawyer "should not go into the contest handicapped in any way which might even subconsciously interfere with that perfect freedom of conduct which his duty to the new client would require him to exercise."
Also, Canon 9 provides that a lawyer should avoid even the appearance of professional impropriety. The Committee majority feels that the circumstances involved in the inquiry contain the distinct potential for an appearance of impropriety in the eyes of laymen, the lawyer being required also by Canon 7 to represent each of his clients zealously.
This opinion is not directed to and not intended to express the Committee's views as to any factual situation other than the one presented to us — whether a firm with a significant plaintiffs' personal injury practice which has a number of cases pending against an insurance company or its insureds may properly defend that company in the same geographical area in a number of personal injury cases of the same general kind in which the firm is suing the company or its insureds.
This opinion does not encompass situations where the law firm has been employed by the insurance company in the past or where it may be employed in the future. It does not intend to deal with circumstances where an attorney is regularly employed by two insurance companies and one sues the other, e.g. on a cross-claim.
The Committee also recognizes that, under present law, a plaintiff's attorney may not know or be able to find out the identity of an individual defendant's insurance carrier prior to the time suit is filed, and this opinion is not intended to deal with the situation that could arise where an attorney files a plaintiff's personal injury action and only then is able to learn that the defendant's insured is a regular client.
A minority of the Committee disagrees with the majority but for divergent reasons. Part of the minority feels that the circumstances related in the inquiry do not involve improper multiple representation unless the attorney's relationship with the insurance company is closer, e.g., as general counsel, and that the judgment of the attorney should be relied upon to exclude instances where the likelihood of impairment of independent professional judgment will exist. Another minority view is that with the informed consent of the clients an attorney should be allowed to use his own judgment. One Committee member feels that the Code of Professional Responsibility prohibits the multiple representation referred to in the inquiry but that the Code should be amended in that respect so as to reflect more realistically practical considerations of trial practice.