Can a lawyer hired by an insurer represent the insured in a contribution counterclaim when the insured might do better by being held liable and recovering under an employer's policy?

Plain-English summary

The committee was asked whether a lawyer employed by an insurance company to represent its insured in a counterclaim for contribution may continue that representation where it may be in the insured's better interest to be held liable on the main case, but then to recover under his employer's policy in the contribution case. In the facts presented, the insured wife had substantial damages, the defendant had minimal insurance coverage, and the insured husband's employer had substantial coverage applicable to the contribution claim.

The committee explained that EC 5-14 requires a lawyer to maintain independent professional judgment and prevents a lawyer from representing two or more clients who may have differing interests, while DR 5-105 requires refusing or discontinuing employment when a conflict arises. It acknowledged that multiple employment can be permissible if it is obvious the attorney can adequately represent each party's interests and each consents after full disclosure.

Applying those rules, the committee concluded that the lawyer at trial would, on one hand, be arguing to minimize both the overall damages and the counter-defendant's negligence, while on the other hand the insured might be better positioned by being found liable so as to recover more under the employer's policy in the contribution case. In those circumstances, the committee held, the lawyer has no choice but to withdraw from the multiple representation.

Currency note

This opinion was issued in the late 1970s, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

The official PDF of this opinion does not carry a printed issuance date; the opinion number places it in the late 1970s.

Common questions

Q: Can one lawyer represent both the insurer and the insured in this situation?

A: The opinion concluded the lawyer may not, because the insured's interest in being held liable to recover under an employer's policy conflicts with the carrier's interest.

Q: When is joint insurer-insured representation permissible?

A: The opinion stated multiple employment can be permissible only if it is obvious the lawyer can adequately represent each party's interests and each consents after full disclosure.

Q: What must the lawyer do once the conflict appears?

A: The opinion concluded the lawyer has no choice but to withdraw from the multiple representation.

Background and rules framework

The opinion interprets CPR EC 5-14 and DR 5-105, the Code provisions on independent professional judgment and conflicts arising from multiple representation. These correspond to Model Rule 1.7 (Florida Rule 4-1.7) on concurrent conflicts of interest.

Citations and references

Rules of Professional Conduct:

• CPR EC 5-14; DR 5-105 (Model Rule 1.7)

See also

• FL Bar Ethics Op. 97-1: Insurer Instructions on Summary Judgment
• FL Bar Ethics Op. 86-6: Representing a Physician and Insurer on Settlement
• FL Bar Ethics Op. 81-5: Insurer Restriction on Settlement Advice

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-78-17/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-78-17-1.pdf

Original opinion text

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

FLORIDA BAR ETHICS OPINION
OPINION 78-17
Advisory ethics opinions are not binding.
An attorney may not represent both an insurance carrier and its insured when the circumstances are such that it would be better for the insured to be held liable and then recover under his employer's policy in contribution. The multiple representation presents a conflict between the best interests of the insured and the best interests of the insurance carrier.
CPR: EC 5-14, DR 5-105
Mr. Corrigan stated the opinion of the committee:
The Committee has been asked whether an attorney who has been employed by an insurance company to represent its insured in a counterclaim for contribution in a factual circumstance in which it may be in the better interest of the insured to be held liable on the main case, but then to be able to recover under his employer's policy in the contribution case, thus creating a possible conflict at the trial between the best interests of the insured and the best interests of the insurance carrier, may continue such representation. In the particular factual situation involved, the insured wife has substantial damages. The defendant has minimal insurance coverage but the insured husband's employer has substantial insurance coverage which would be applicable on the contribution claim.
Ethical Consideration 5-14, which requires a lawyer to maintain the independence of professional judgment, prevents a lawyer from representing two or more clients who may have differing interests. Disciplinary Rule 5-105 relates to refusing to accept or continue employment if a conflict arises. Multiple employment can be permissible if it is obvious that the attorney can adequately represent the interests of each party 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.
In the question posed, however, it is obvious that the lawyer at the trial on one hand should be arguing to minimize both the overall damages and the counter-defendant's negligence, and on the other hand, the insured might be in a better position to be found to be liable and thus be able to recover more money under his employer's policy in the contribution case. In such circumstances, the lawyer has no choice but to withdraw from the multiple representation.