Can a lawyer file a new, unrelated lawsuit against someone the lawyer is still representing in a pending collection matter?

Plain-English summary

The inquirer asked whether he could undertake a negligence action against an individual he had formerly represented in two unrelated matters, where a judgment from one of those matters remained outstanding and would in part fund his contingent fee. In the collection matter, the attorney had obtained and docketed a judgment on a contingent-fee basis, but no collection action had been taken since October 1980, and he stated he did not intend to do anything further on the file. He had also represented the same client in a breach-of-contract suit that ended in a judgment dismissing the client's complaint. He had now been asked to represent a new client in a workers' compensation or negligence claim against his "former client," and offered, if necessary, to waive the contingent fee on the collection judgment.

The Committee disagreed with the inquirer's characterization of the man as a "former client." It found that, on the facts, there was a continuing representation: the attorney had a duty, absent a release by the client, to continue exerting reasonable efforts to collect the judgment, so the representation was on-going and had not ended. The disqualification rested on two principles, conflict of interest and the avoidance of the appearance of impropriety.

Quoting with approval from Opinion 301, the Committee observed that the impropriety of taking a case against a former client is not based solely on the necessity of disclosing confidential communications; if the former client has any reason to feel aggrieved, the need to maintain proper public relations for the bar and avoid the appearance of wrongdoing should lead the attorney to refuse adverse employment. The Committee concluded that, absent informed consent by all parties terminating the present relationship and consenting to the proposed adversarial representation, the inquirer was barred from undertaking it.

Currency note

This opinion was issued in 1982, 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. The 2004 revisions abolished the freestanding "appearance of impropriety" standard the Committee invoked. 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 Treat this page as historical context, not current guidance.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: Was the inquirer's man a "former client" or a current one?

A: The opinion held he was a current client. Because the attorney still owed a duty to pursue collection of the docketed judgment, the representation was ongoing, not ended.

Q: Could the lawyer sue that client in a new, unrelated matter?

A: No. The opinion concluded the continuing representation barred the lawyer from bringing the new unrelated action against the client.

Q: Would waiving the contingent fee or the fact that the matters were unrelated cure the problem?

A: No. The opinion held that even a terminated relationship would bar the adverse representation absent the informed consent of all parties; an unrelated matter and a fee waiver did not by themselves cure it.

Background and rules framework

The opinion was decided under the conflict principles then governing New Jersey lawyers, before the 1984 adoption of the Rules of Professional Conduct, applying both the conflict-of-interest rule and the appearance-of-impropriety standard. In current terms the analysis maps onto RPC 1.7 (a lawyer may not act adversely to a current client without informed consent) and RPC 1.9 (duties to former clients), the framework that replaced the Code's DR 5-105.

Citations and references

Rules of Professional Conduct:

• MR 1.7 / NJ RPC 1.7 (conflicts with a current client)
• MR 1.9 / NJ RPC 1.9 (duties to former clients)

Other opinions cited:

• NJ ACPE Opinion 301, 98 N.J.L.J. 209 (1975) (impropriety of taking a case against a former client; quoted with approval)
• NJ ACPE Opinions 43, 154, 313, 367, and 391 (conflict and appearance-of-impropriety principles)

See also

• NJ ACPE Op. 531: Opposing a Departed Partner's Corporate Client in a Divorce
• NJ ACPE Op. 547: Sewerage Authority Counsel Whose Partner Sues the Authority

Source

• Full text (Justia mirror): https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp507-1.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.

110 N.J.L.J. 408, October 7, 1982

OPINION 507

Conflict of Interest Suing Client in Unrelated Action

We quote the inquiry in the language presented to us:

QUESTION: May an attorney properly undertake a negligence action against an individual who he had formerly represented in two unrelated matters where a judgment remains outstanding from one matter which judgment will in part be used to provide the attorney's contingent fee?

The facts as presented are as follows: The attorney apparently had been retained by the client (whom he now proposes to oppose) in a collection matter which the attorney undertook to handle on a contingent fee basis; i.e., a percentage of the amount collected. The attorney instituted suit and obtained a judgment in the county District Court, which was subsequently docketed in the Superior Court. Discovery proceedings were then instituted; the debtor never attended the discovery hearing and since that time; namely, October 1980, no action for the collection of the judgment has been taken in connection with the matter. Although the inquirer states "I did not intend to do anything further regarding this collection file and have not, in fact, taken any further action on it," nevertheless, the file and the matter is a pending matter in his office and the representation with reference thereto is a continuing one. Additionally, he also represented the same client in another matter involving a suit for breach of contract which, after an 8-day trial, resulted in a judgment dismissing his client's Complaint. That matter appears to have been completed. He further advises that he has "now been requested to represent a client in a workers compensation and/or negligence claim against my former client, his spouse and/or a corporation in which they are officers." The inquirer characterizes his client as "my former client." We do not agree with such characterization.

In presenting the inquiry the inquirer states that, if it is necessary, he is willing to waive the contingency fee with reference to the judgment in the collection matter in its entirety.

The problem posed by this inquiry is one with which we have dealt heretofore. Based upon the facts as presented, it is clear that there is a continuing representation by the attorney of the client. He has a duty, in the absence of being released therefrom by the client, to continue to exert such efforts as are reasonably necessary in behalf of said client to collect the judgment. The representation of the client is on-going; it has not ended. The disqualification involves two basic ethical principles; namely, the matter of a "conflict of interest" as well as "avoiding the appearance of impropriety." See our Opinions 43, 154, 313, 367 and 391. Even if the attorney/client relationship has been terminated, nevertheless, we hold that, based upon the facts as presented, the inquirer could not undertake the new representation.

In our Opinion 301, 98 N.J.L.J. 209 (1975), we cited with approval the following, which is equally applicable, on the facts presented, to the instant inquiry:

The impropriety of taking a case against a former client is not based solely on necessity for disclosure of confidential communications. If the former client has any reason to feel aggrieved, the necessity of maintaining proper public relations for the bar and of avoiding the appearance of wrongdoing should cause the attorney to refuse to accept employment in a capacity adverse to the interests of a former client.

In the absence of an informed consent by all parties concerned terminating the present attorney/client relationship and consenting to the new proposed adversarial representation, the inquirer is barred from such undertaking. See our Opinion 43, 87 N.J.L.J. 285 (1964)