Can one attorney represent both an injured plaintiff and the plaintiff's own insurance carrier, which is subrogated for medical payments, in the same tort action?

Plain-English summary

The Committee was asked whether an attorney may, with informed consent, represent both an insured plaintiff in a tort action and the plaintiff's insurance carrier, which had paid the plaintiff's medical expenses and was subrogated to the recovery of those expenses. The inquirer recognized a potential conflict in settlement negotiations and the decision whether to try the case, had proposed a course of action to protect the plaintiff at the carrier's risk if a conflict arose, and reported that the carrier had consented; the Committee assumed the plaintiff likewise consented and that the conditions of DR 5-105(C) were met.

The Committee explained that DR 5-105 does not forbid all employment involving conflicts; it permits dual representation under DR 5-105(C) where the attorney believes he can adequately represent each party and each consents after full disclosure of the facts and the possible effect on the lawyer's independent professional judgment. It pointed to ABA Formal Opinion 282, which recognized that such consent is available in subrogor-subrogee situations, and to EC 5-17, which notes potential conflicts between insureds and insurers and recognizes that representation after informed consent may be undertaken when the conditions of DR 5-105(C) are met.

The Committee concluded that, on the stated facts, dual representation with informed consent was permissible. It presumed the plaintiff was a competent adult acting in his own interest and the carrier was competent to make its own decisions, including the self-interested desire to avoid paying two sets of legal fees out of one fund where the parties' interests on the merits were identical. It held that the parties may consent to the dual representation under agreed conditions for anticipated conflict situations, and that on such consent the representation is proper, provided all other conditions of DR 5-105(C) are met.

Currency note

This opinion was issued in 1976, before New Jersey's adoption of the 2004 revisions to the Rules of Professional Conduct, and predates the 1984 replacement of the Disciplinary Rules by the RPCs. Concurrent-conflict questions, formerly governed by DR 5-105 and its consent provision DR 5-105(C), are now analyzed under RPC 1.7, whose consent standard differs. 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 one lawyer represent both the injured plaintiff and the plaintiff's own insurer?

A: Under this opinion, yes, where the conditions of DR 5-105(C) are met and both clients consent after full disclosure.

Q: Why was consent available despite the potential conflict?

A: Because the parties' interests on the merits were identical, and the Committee, following ABA Formal Opinion 282 and EC 5-17, treated subrogor-subrogee conflicts as consentable.

Q: What was the lawyer expected to plan for?

A: A course of action, agreed in advance, to protect the plaintiff at the carrier's risk if a conflict arose in settlement or trial decisions.

Background and rules framework

The opinion applied DR 5-105 and its consent provision DR 5-105(C), informed by ABA Formal Opinion 282 and EC 5-17, to a subrogor-subrogee dual representation. In current New Jersey terms, the concurrent-conflict analysis is governed by RPC 1.7.

Citations and references

Rules of Professional Conduct:

• DR 5-105 and DR 5-105(C) (declining or accepting employment with conflicting interests; client consent after full disclosure), as in effect 1976; now MR 1.7 / NJ RPC 1.7
• EC 5-17 (potential conflicts between insureds and insurers)

Other opinions cited:

• ABA Committee on Ethics and Professional Responsibility, Formal Opinion 282 (consent available in subrogor-subrogee situations)

See also

• NJ ACPE Op. 502: Insurer's Counsel and the Insured Where Coverage Is in Issue
• NJ ACPE Op. 358: Suing an Estate the Lawyer Administered

Source

• Full text (Justia mirror): https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp357-1.html
• Issuing authority: New Jersey Supreme Court Advisory Committee on Professional Ethics, via the NJ Courts Supreme Court Committees page

Original opinion text

Reproduced from a full-text mirror of the official opinion for research purposes. The linked official source controls.

99 N.J.L.J. 1074, December 2, 1976

OPINION 357

Conflict of Interest
Representing Plaintiff and His Insurer

An attorney asks whether he may, with the informed consent of the parties, represent an insured plaintiff in a tort action and also plaintiff's insurance carrier. The carrier has paid plaintiff's medical expenses, and is subrogated under the policy to plaintiff's rights to the recovery of such expenses to the extent of the payment. The inquirer recognizes the existence of a potential conflict in the area of prospective settlement negotiations and related decisions as to whether or not to proceed with trial in light thereof. He has advised the carrier of a proposed course of action to protect the plaintiff at the carrier's risk in the event that such conflict arises, and the carrier has agreed to the proposed course of action and given its consent. Similarly, we assume the consent of the plaintiff to the dual representation and that the conditions of DR 5-105(C) have been met. Otherwise the inquiry would be meaningless, and our decision would, of course, be that the dual representation would be improper.

DR 5-105 does not forbid all employment involving conflicts and in fact permits it when it comes within the purview of DR 5-105(C). That applies where the attorney believes he can adequately represent the interests of each party and "each consents to the representation after full disclosure of the facts and of the possible effect of such representation on the exercise of his independent professional judgment on behalf of each". The American Bar Association, Committee on Ethics and Professional Responsibility, Formal Opinion 282, interpreting Canon 6 of the Canons of Professional Ethics (predecessor to DR 5-105), specifically recognized that such consent was available in situations involving conflicts relating to subrogor and subrogee. Further, the ethical considerations adopted by the American Bar Association and relating to DR 5-105 take specific note of potential conflict situations in the case of insureds and insurers, and recognize that representation after informed consent may be undertaken in such cases where all the conditions of DR 5-105(C) are met. See EC 5-17.

It seems to us that in this case dual representation with informed consent is permissible. We presume, under the facts as stated, that the plaintiff is a competent adult, acting in his own self-interest, and the corporate carrier is certainly presumed to be similarly competent to make its own decisions based on considerations of self-interests. This self-interest would, naturally, include a desire to avoid payment of two sets of legal fees from one potential fund under circumstances where, on the merits of the issues in suit, the interests of both parties are identical.

Under these circumstances, it appears that the parties may consent to the dual representation in question under such conditions as may be agreed to regarding future anticipated situations relating to conflict and, upon such consent, the representation in question is proper, provided that all the other conditions of DR 5-105(C), referred to above, are met.