Does a one-hour consultation that never led to representation still create confidentiality duties that can disqualify the lawyer's firm years later?

Plain-English summary

Years earlier, Attorney A had a roughly one-hour meeting with an individual who was a remainder beneficiary and co-trustee of a family trust being sued for breach of fiduciary duty. Attorney A did not take the representation, opened no file, kept no documents, made no referral, and could recall no information that was not already public. The individual lost that earlier litigation. Attorney A later joined a different four-lawyer firm. Now Attorney B, Attorney A's partner, had been approached by the trust's new trustees to bring an action against that same individual concerning a more-than-ten-year-old order, though the facts behind the order were not at issue. The questions were when an attorney-client relationship forms, and whether Rule 1.6 duties attach to confidences received from a potential client even if no relationship forms.

The committee explained that whether an attorney-client relationship exists is a question of fact and can arise from an initial consultation even without a formal retainer, fee, or signed agreement. More importantly, it held that the duties under Rule 1.6(a) may attach when a lawyer and a potential client are considering whether to form a relationship: a potential client's initial consultation creates an expectation of confidentiality that the lawyer must protect even where no representation otherwise arises. Whether confidences were actually received is a case-by-case factual question, and the absence of notes, a file, a fee, or a retainer does not affect the Rule 1.6(a) obligation.

Applying this, the committee could not determine on the limited facts whether a relationship formed or whether confidences were shared, but observed it was difficult to imagine a one-hour consultation about potential representation in which the individual disclosed nothing confidential. If confidences were received, Rule 1.9(b) would prevent Attorney B (through Rule 1.10 imputation) from representing the trustees in a matter materially adverse to the individual in a substantially related matter, unless the individual consents after consultation. The committee noted that South Carolina's possible adoption of ABA Model Rule 1.18 on prospective clients could affect the analysis.

In practice

Under this opinion, on the facts presented, a lawyer cannot assume that a brief, unconsummated consultation leaves the firm free to take the other side later. The committee tied the confidentiality duty to Rule 1.6(a) as applied to prospective clients, made the existence of received confidences a case-by-case factual question, and applied Rule 1.9(b) with Rule 1.10 imputation to potentially disqualify the partner absent the prospective client's consent after consultation. It flagged that adoption of Model Rule 1.18 could change the analysis.

Common questions

Q: I met with someone once but never took the case. Do I owe any duties?

A: Possibly. The committee holds that Rule 1.6(a) confidentiality duties may attach to a prospective client if you received confidences, even with no file, fee, or retainer.

Q: Can my partner now sue that former prospective client?

A: Maybe not. If confidences were received, Rule 1.9(b) and Rule 1.10 imputation can bar the firm from representing an adverse party in a substantially related matter unless the prospective client consents after consultation.

Q: Does it matter that I cannot recall what was said?

A: The committee found that of little comfort. It said it was hard to imagine a one-hour consultation in which no confidences were shared, and the factual question is whether confidences were in fact disclosed.

Background and rules framework

The opinion applies South Carolina's versions of Model Rule 1.6 (confidentiality, specifically 1.6(a) as applied to prospective clients), Model Rule 1.9 (duties to former clients, specifically 1.9(b)), and Model Rule 1.10 (imputation of conflicts), at SCACR 407. The committee noted that adoption of ABA Model Rule 1.18 (duties to prospective clients), then under consideration in South Carolina, could affect the result.

Citations and references

Rules of Professional Conduct:

• MR 1.6 / SC Rule 1.6(a) (confidentiality; duty to prospective clients)
• MR 1.9 / SC Rule 1.9(b) (duties to former clients; firm-side conflicts)
• MR 1.10 / SC Rule 1.10(a) (imputation of conflicts within a firm)

Cases:

• In the Matter of Broome, 2003 WL 22661330 (S.C. Nov. 2003), client status arises from confidential communication seeking legal advice

Other opinions cited:

• SC Ethics Advisory Opinions 91-03, 88-11, 89-19, 97-45 (formation of the attorney-client relationship)

See also

• SC Bar Ethics Op. 04-08: Former guardian ad litem switching sides
• ABA Formal Op. 492: Obligations to prospective clients
• ABA Formal Op. 90-358: Protection of information imparted by a prospective client

Source

• Landing page: https://www.scbar.org/for-lawyers/quicklinks/legal-resources/ethics-advisory-opinions/ethics-advisory-opinion-03-12/

Original opinion text

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

UPON THE REQUEST OF A MEMBER OF THE SOUTH CAROLINA BAR, THE ETHICS ADVISORY COMMITTEE HAS RENDERED THIS OPINION ON THE ETHICAL PROPRIETY OF THE INQUIRER’S CONTEMPLATED CONDUCT. THIS COMMITTEE HAS NO DISCIPLINARY AUTHORITY. LAWYER DISCIPLINE IS ADMINISTERED SOLELY BY THE SOUTH CAROLINA SUPREME COURT THROUGH ITS COMMISSION ON LAWYER CONDUCT.

Ethics Advisory Opinion 03-12

FACTS
Prior to 1991, Attorney A was a member of a firm of approximately 12 lawyers. During that period Attorney A met with Individual who was a remainder beneficiary of a trust established by his grandfather for the benefit of his mother. Individual and his mother were co-trustees of the trust and were being sued by other remainder beneficiaries for breach of fiduciary duties. The meeting was no longer than an hour, and Attorney A did not undertake representation. No file was opened or documents retained by Attorney A. Attorney A can recall no information provided by Individual that was not public record or which was not subsequently made public record as part of the litigation. Attorney A did not refer Individual to any other attorneys.
Individual lost the action, was removed as co-trustee, and was required to pay back a substantial sum of money as penalty.
Attorney A left the firm, practiced on his own for several years, and eventually joined another practice of four lawyers.
Attorney B, now a partner of Attorney A, has been approached by the new trustees of the trust, seeking representation involving the clarification and application of certain portions of the order, now more than ten years old, issued against Individual. The action will involve an action against Individual, although the facts leading to the earlier order are not at issue.
Although there has been no contact by Attorney A with Individual and they have not spoken since the meeting years ago, Individual has recently called Attorney A, leaving a message seeking a referral to an attorney for representation on an undisclosed matter.

QUESTIONS PRESENTED
(1) When is an attorney-client relationship formed?
(2) Does an attorney have ethical obligations under Rule 1.6 concerning confidences received from a potential client, if an attorney-client relationship is not formed?

SUMMARY
While most duties of a lawyer to the client attach only after an attorney-client relationship comes into existence, the duties under Rule 1.6 (a) may attach when a lawyer and potential client are considering whether to form an attorney-client relationship. Whether confidences are received by the attorney is a factual issue which must be decided on a case-by-case basis. If confidences are received from the potential client, attorney may not reveal the confidences unless the client consents after consultation. Under Rule 1.9(b) neither attorney nor an associate of attorney, under Rule 1.10, can represent a person in the same or substantially related matter, whose interests are materially adverse to the potential client, unless the potential client consents after consultation.

OPINION
The Committee has said that “whether an attorney-client relationship exists in a particular situation is a question of fact... S.C. Bar Ethics Advisory Opinion #91-03 (citing Chavez v. State, 604 P.2d 1341, 1346 (Wyo. 1980)). Although this relationship may be created even without formal recognition of the relationship by lawyer, and an attorney-client relationship may arise from an initial consultation with a potential client regarding a matter, even when the lawyer is never formally retained...” S.C. Bar Ethics Adv. Ops. 88-11, 89-19 and 97-45. “A person attains the status of a client when that person seeks legal advice by communicating in confidence with an attorney for the purpose of obtaining advice. Moreover, a signed retainer agreement is not essential to create such a relationship. See 7 Am.Jur.2nd Attorneys 136 (2003)” In the Matter of Broome, 2003 WL 22661330 (S.C. Nov. 2003). A professional relationship is not dependent upon the payment of fees nor, as we have noted, upon the execution of a formal contract. Allman v. Wilkeman,106 F.2d 663, 665 (9th Cir. 1939), cert. denied, 309 U.S. 668, 60 S.Ct. 608, 84 L.Ed. 1014 (1940). Lawyer’s advice to his client establishes a professional relationship though it be gratis. Fort Meyers Seafood Packers, Inc. v. Steptoe and Johnson, 127 U.S. App.D.C. 93, 94, 381 F.2d. 261, 262, (1967), cert. denied, 390 U.S. 946, 88 S.Ct. 1033, 19 L.Ed.2d 1135 (1968), Westinghouse Electric Corporation v. Kerr-McGee Corporation, 580 F.2d 1311, 1318 (7th Cir.)

While most duties of a lawyer to the client attach only after an attorney-client relationship comes into existence, the duties under Rule 1.6(a) may attach when a lawyer and potential client are considering whether to form an attorney-client relationship. “A lawyer shall not reveal information relating to representation of a client unless the client consents after consultation...” Rule 1.6(a). The purpose behind Rule 1.6(a) is to encourage the client to communicate fully and frankly with the lawyer even as to embarrassing or legally damaging subject matter. (See comments to Rule 1.6.) If, after being consulted, the obligation of an attorney to a prospective client’s confidences under Rule 1.6(a) were limited to cases in which the lawyer received a consultation fee, took notes, opened a file or was paid a retainer, every prospective client would be afraid to consult a lawyer for fear that the lawyer might disclose the confidences or would later take the other side of the controversy. A potential client’s initial consultation with an attorney creates an expectation of confidentiality, which must be protected by the attorney even where no attorney-client relationship arises in other respects. The preservation of confidentiality must be based upon a case-by-case determination as to the lawyer’s actual receipt of a potential client’s secrets or confidences. (See Opinion 86 Advisory Committee on Professional Ethics appointed by Supreme Court of New Jersey.)

With the limited facts presented, the Committee cannot determine whether an attorney-client relationship was formed between Attorney A and potential client. The fact that the Attorney A cannot recall the information provided by the prospective client is of little comfort, if there were in fact confidences disclosed to Attorney A during the meeting with prospective client. It is difficult to imagine that during the one hour conference concerning potential representation, that potential client did not divulge confidences to Attorney A. The fact that Attorney A did not take notes, open a file, receive a fee or undertake representation does not affect his obligation under Rule 1.6(a). And Rule 1.10(a) states: “While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rules 1.7, 1.8(c), 1.9 or 2.2.”

The representation of Trustees by Attorney B is substantially related to the matter for which potential client consulted Attorney A. Under the facts as presented, Attorney A had direct contact with potential client and, if he received confidential information, Rule 1.9(b) will prevent Attorney B from representing the Trustees in a matter which is materially adverse to the interest of potential client, unless potential client consents after consultation. If an attorney-client relationship was formed by Attorney A, then Attorney B will need to review Rules 1.7(a) and 1.10(a).

Note: Adoption of ABA Model Rule 1.18 dealing with Prospective Clients, which is under consideration in South Carolina, could affect the analysis and conclusion of this opinion.