Can a lawyer who is a shareholder in a law firm try the firm's own fee-collection suit when other firm shareholders will testify?

Plain-English summary

A shareholder in an incorporated law firm asked whether she could serve as trial counsel for the firm in a suit to collect attorney's fees from a former corporate client and certain individual shareholders of that client, where three other shareholders of her own firm would testify about the services rendered and how they benefited the individual defendants. An outside expert would testify to the value of the services. The committee concluded she could ethically represent the firm.

The committee framed the issue under the advocate-witness rule. DR 5-101(B) requires a lawyer to refuse employment in litigation if the lawyer or a lawyer in the firm ought to be called as a witness, and DR 5-102(A) requires withdrawal when it becomes obvious that the lawyer or a member of the firm will testify on a client's behalf. The committee explained that the rule's rationale is to avoid the public perception that a lawyer-witness is distorting the truth for a client.

The committee reasoned that a sole practitioner could represent herself in a suit to collect her own fees without "accepting employment" or having a "client" in the sense those terms are used in DR 5-101 and DR 5-102. It applied the same construction to a partnership or incorporated practice: the advocate shareholder should be treated as representing the firm's own interests, not those of a separate client. It concluded that neither professional ethics nor the ends of justice preclude a firm from representing itself through one of its members in a fee-collection action against a former client, even though some members or shareholders will testify.

Currency note

This opinion was issued in 1984, 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 Treat this page as historical context, not current guidance.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.

Common questions

Q: Can a firm shareholder be trial counsel in the firm's own fee suit?

A: The opinion concluded that a shareholder may represent her incorporated firm at trial in a fee-collection suit against a former client.

Q: Does the advocate-witness rule bar this when other shareholders testify?

A: The opinion concluded the advocate-witness rule does not apply, because the firm is representing its own interests rather than a separate "client" as that term is used in DR 5-101 and DR 5-102.

Q: How does the committee treat a firm compared to a sole practitioner?

A: The opinion concluded that the same reasoning allowing a sole practitioner to represent herself in collecting her own fees applies to a partnership or incorporated practice.

Background and rules framework

The opinion interprets the advocate-witness rule of CPR DR 5-101 and DR 5-102, which corresponds to Model Rule 3.7 (lawyer as witness). The opinion turns on the meaning of "employment" and "client" in those provisions when the litigant is the lawyer's own firm.

Citations and references

Rules of Professional Conduct:

• CPR DR 5-101; DR 5-102 (Model Rule 3.7, lawyer as witness)

See also

• FL Bar Ethics Op. 88-1: Action Against a Client for Unpaid Fees
• FL Bar Ethics Op. 86-2: Interest on Unpaid Fees and Costs

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-84-4/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-84-4-1.pdf

Original opinion text

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

FLORIDA BAR ETHICS OPINION
OPINION 84-4
September 15, 1984
Advisory ethics opinions are not binding.

An attorney who is a shareholder in an incorporated law firm may represent the firm at trial in a suit against a former client, for attorney's fees even though other shareholders will be called as witnesses on behalf of the firm.

CPR: DR 5-101; DR 5-102

Vice Chairman Proctor stated the opinion of the committee:

An attorney who is a shareholder in an incorporated law firm inquires whether she may ethically represent her law firm as trial counsel in a suit for collection of attorney's fees against a former corporate client and certain individuals who are shareholders in that corporation, in which suit three other shareholders in the inquiring attorney's firm will be witnesses at trial. An outside witness will be the expert witness on the value of the legal services rendered, and the three fellow shareholders of the inquiring attorney will testify to the services provided to the corporate defendant and the individual defendants, and how those services benefited the individual defendants. The inquiring attorney asserts that the only contested issue in the action is whether the legal services rendered benefited the individual defendants.

The Committee has concluded that the facts and circumstances involved in this inquiry are such that the inquiring attorney can ethically represent her law firm in an action against a former client of the law firm for the collection of attorney's fees.

DR 5-101 provides that a lawyer refuse employment in contemplated or pending litigation if he or she knows that he or she or a lawyer in his or her firm ought to be called as a witness. Likewise, DR 5-102(A) requires that a lawyer and his or her firm withdraw from conducting a trial when it is obvious that he or she or a member of his or her law firm will be called as a witness on behalf of a client. It appears that a primary basis or rationale for this longstanding rule, which is commonly referred to as the "advocate-witness rule," is to preclude a perception by the public that a lawyer in his capacity as a witness is distorting the truth for the sake of his client. There is no dearth of judicial and bar association committee opinions and discussions pertaining to the advocate-witness rule and its application to a multiplicity of situations. We do not, however, feel that the rule is applicable in the instant situation.

If the inquiring attorney was a sole practitioner, we believe that she could represent herself in a suit for collection of attorney's fees owed to her. In such a case we do not think that she would be accepting "employment" as we think that term should be interpreted under DR 5-101(B), nor do we think such a situation would involve a "client" as we think that term should be interpreted under DR 5-102(A). We likewise believe that this construction, interpretation or rationale can and should be applied or utilized to obtain the same determination or result in situations involving a law partnership or an incorporated law practice. The advocate partner or shareholder should, for purposes of interpreting the strictures of DR 5-101 and DR 5-102, be construed to be representing his or her own interests, and not the interest of an independent "client" as that term is traditionally construed or used in relation to those provisions.

In conclusion, the Committee is of the opinion that neither professional ethics nor the ends of justice prohibit or preclude a law firm from representing itself by or through one of its members or shareholders in an action for collection of attorney's fees against a former client, notwithstanding that some members or shareholders of the firm will be called as witnesses in the action.