Must a lawyer tell an insurer that a personal-injury claimant died while future pain-and-suffering claims remain in settlement talks?

Plain-English summary

A lawyer negotiating a personal-injury settlement with an insurer learned that the client had died of unrelated causes. The insurer did not know. The lawyer believed disclosure would weaken a claim that included future pain and suffering.

The committee said former DR 1-102 and DR 7-102 prohibited deceit, misrepresentation, and knowingly false statements inside and outside court. It declined to impose a broad obligation to reveal every weakness in a client's case. On these facts, however, withholding the death would allow the insurer to value future pain and suffering as if the claimant were alive. The committee found that passive nondisclosure would be misleading and required disclosure.

Currency note

This opinion was issued in 1989, before Vermont's 1999 adoption of 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 Treat this page as historical context, not current guidance.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.

Common questions

Q: Did the committee require disclosure of every fact that reduced settlement value?

A: No. It expressly declined to read the former rules as broadly requiring disclosure of all case weaknesses or value-reducing facts.

Q: Why did the client's death require disclosure here?

A: Future pain and suffering had been claimed, and silence would let the insurer proceed on the false belief that the claimant was alive.

Background and rules framework

The opinion applied former Vermont DR 1-102(4) on dishonesty and misrepresentation and DR 7-102(5) on knowingly false statements. It distinguished its earlier Opinion 82-7 concerning facts discovered after settlement.

Citations and references

Former Vermont disciplinary rules:

• DR 1-102(4) and DR 7-102(5).

Other opinions cited:

• Vermont Opinion 82-7.

See also

• Rhode Island Ethics Op. 93-81: Possible insurer overpayment
• New York Ethics Op. 1229: Duties after a client's death

Source

• Landing page: VBA settlement opinions
• Original PDF: Vermont Advisory Opinion 89-02
• Rules history: Vermont Rules of Professional Conduct, “These rules apply to lawyer conduct after September 1, 1999.”