Can a plaintiff's lawyer send settlement demands directly to the insurer that is providing defense counsel for the adverse party?

Plain-English summary

Lawyer A was insured against professional malpractice. A plaintiff sued Lawyer A for malpractice, and the insurance company provided Lawyer B to defend Lawyer A. The inquiry asked whether the plaintiff's counsel could communicate settlement demands to Lawyer B with a copy to the insurance company.

The opinion answered no, unless Lawyer B consents. Rule 7.4(a) prohibits a lawyer from communicating about the subject of the representation with a party the lawyer knows to be represented by another lawyer in the matter, absent that lawyer's consent or legal authorization. For purposes of the rule, an insurance company that provides counsel for its insured in defending a third party's liability claim is itself a party represented by counsel, and so may not be contacted directly by the third party's lawyer unless the lawyer for the insured and insurer consents.

Currency note

This opinion was issued in 1988, before the North Carolina State Bar's adoption of the 2003 revisions to the Rules of Professional Conduct. The provision it applies (Rule 7.4(a), the no-contact rule) has since been renumbered and revised (the corresponding Model Rule is 4.2). 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 Treat this page as historical context, not current guidance.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 plaintiff's lawyer send settlement demands straight to the adverse party's insurer?

A: No, unless defense counsel consents. The opinion concluded the insurer is a represented party under the no-contact rule.

Q: Why is the insurer treated as a represented party?

A: The opinion concluded that an insurer providing counsel to defend its insured against a liability claim is itself a party represented by that counsel.

Q: What would make the direct contact permissible?

A: The opinion concluded the contact is permissible only with the consent of the lawyer for the insured and insurer.

Background and rules framework

The opinion applied North Carolina Rule 7.4(a), the no-contact rule barring communication with a represented party absent counsel's consent or legal authorization (corresponding to Model Rule 4.2). The analysis turned on characterizing the insurer that funds and directs the defense as itself a represented party, not a mere nonparty, so the opposing lawyer's direct contact required consent.

Citations and references

Rules of Professional Conduct:

• North Carolina Rule 7.4(a) (communication with a represented party)
• MR 4.2 (communication with person represented by counsel)

See also

• NC Ethics Op. RPC 67: interviewing employee of adverse corporate party
• NC Ethics Op. RPC 62: disclosure of client confidences in defense of legal malpractice claim

Source

• Landing page: https://www.ncbar.gov/for-lawyers/ethics-and-governing-rules/ethics-opinions/opinions/rpc-39/

Original opinion text

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

Inquiry:

Lawyer A is insured against professional malpractice by Insurance Company. Plaintiff sues Lawyer A for malpractice. Insurance Company provides Lawyer B to defend Lawyer A. May Plaintiff's counsel communicate settlement demands to Lawyer B with a copy to Insurance Company?

Opinion:

No, unless Lawyer B consents. Rule 7.4(a) prohibits a lawyer from communicating regarding the subject of representation with a party the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized by law to do so. For the purpose of this rule, an insurance company which provides counsel for its insured in the defense of a third party's liability claim is itself a party represented by counsel and may, therefore, not be contacted directly by the third party's lawyer unless the lawyer for the insured and insurer consents.