DR 5-101(A) revisited
By Scott Morrill
Shortly after the April 2004 Bulletin came out the Oregon Supreme Court decided In re Obert, 336 Or 640, 89 P3d 1173 (2004) and In re Knappenberger, 337 Or. 15, 90 P3d 614 (2004). Both cases may be found on the Oregon Supreme Court website at www.publications.ojd.state.or.us. These two decisions give additional guidance to lawyers on the meaning and effect of DR 5-101(A) (Self Interest Conflicts of Interest). While there were other issues in each case, this column will focus on the DR 5-101(A) concerns.
Obert represented a client in a post-conviction relief matter. He missed an appeal deadline and the court dismissed the case. After learning that his client’s appeal had been dismissed, Obert failed to promptly notify his client. Instead, he researched whether there was any way to reinstate his client’s appeal. When he determined that there was no way to reinstate the appeal, Obert stopped communicating with his client and refused to return calls or answer correspondence from his client. Obert testified at his disciplinary hearing that he was "ashamed and embarrassed" that he had missed the filing deadline. Five months after the court dismissed his client’s appeal Obert informed his client and withdrew.
The bar argued that Obert had a duty to comply with DR 5-101(A) when he began researching whether his client’s appeal could be reinstated in hopes of fixing his mistake. The bar argued that Obert’s interests and his client’s interests diverged once he realized he had made a mistake. The bar noted that Obert admitted his shame and embarrassment as evidence that his judgment was affected. The bar also argued that the possibility of a malpractice claim reasonably affected Obert’s judgment.
The court agreed that Obert continued to represent his client by searching for a way to reinstate the appeal. However, the court held that the bar missed the mark in arguing that DR 5-101(A) was triggered when Obert began his search for a solution to his problem. The court found that there was no evidence that Obert’s judgment was so affected or that his interests were adverse to his client’s while he was searching for a way to correct his mistake. After Obert determined that there was no fix, there was no evidence that Obert continued to work for his client.
The court also found the bar’s second argument lacking. The bar argued that the possibility of a malpractice claim may have impaired Obert’s judgment requiring him to disclose the possible conflict to his client. The court held that until there was evidence that Obert’s interests diverged from his client’s there was no evidence that his professional judgment was affected. The point at which Obert’s interests diverged was when he determined that he could not fix his mistake and had likely committed malpractice. However, after he made that determination Obert did no further work for his client. The court held that the mere possibility of malpractice did not automatically invoke DR 5-101(A). Rather, the potential for impaired judgment must be reasonable. In Obert’s case, once he determined that he had probably committed malpractice and his and his client’s interests diverged, he did no further work for his client.
The DR 5-101(A) issue in In re Knappenberger is similar to the one raised in In re Obert. In one client’s matter Knappenberger filed a notice of appeal in a domestic relations case, but failed to properly serve the opposing party. The opposing party moved to dismiss the appeal based on the failure to properly serve, but Knappenberger felt that this motion had little chance of success. The court dismissed the appeal for lack of service, but addressed the substantive issues anyway because of a cross-appeal filed by the opposing party. It is unclear whether Knappenberger notified his client or his client found out from another source about the dismissal. However, the court ultimately awarded the opposing party fees and costs, which Knappenberger failed to notify his client of.
The bar argued that the possibility of a malpractice claim for failing to properly serve the opposing party triggered a duty to disclose the problem to the client and obtain the client’s consent to Knappenberger’s continued representation of the client. Knappenberger argued that it was not certain that his failure to serve the motion would have resulted in malpractice liability because he did not believe the opposing party’s motion would succeed. He further argued that his error was harmless because the court addressed the substantive issues anyway.
The Oregon Supreme Court held that an error does not automatically invoke DR 5-101(A). Rather, the bar must prove by clear and convincing evidence that the error, and the pending or potential liability arising from the error, will or reasonably may affect the lawyer’s judgment before the lawyer must make full disclosure to the client and obtain the client’s consent to proceed. In Knappenberger’s situation, the court found that the bar failed to meet this burden. The court found that because Knappenberger did not believe the opposing party’s motion had much chance of success, there was no self-interest conflict. Additionally, the appellate court reached the substantive issues in the appeal anyway.
On a different client’s matter, Knappenberger filed a petition for post-conviction one day late. However, he continued to work on this client’s matter and failed to advise his client that the state had moved to dismiss until several months later. When he did advise his client that there might be a problem, he did not identify his error as being the source of the problem. Rather, he suggested that he would not continue to work on the matter without getting paid. The court granted the state’s motion to dismiss and Knappenberger then notified his client that it was because he missed the filing deadline. Knappenberger admitted that his conduct violated DR 5-101(A) and the court agreed. We leave it to the reader to decide what the difference is between Knappenberger’s conduct in this matter and Obert’s conduct in his matter.
One lesson to be learned from these cases is that a lawyer mistake does not mechanically invoke DR 5-101(A). The bar must prove that the lawyer’s interests diverged from the client’s interests and that the divergence affected or reasonably could affect the lawyer’s professional judgment before the lawyer must make full disclosure to and obtain the client’s consent to proceed. The determination that a lawyer’s professional judgment may be affected must be reasonable. The analysis is whether under the facts and circumstances of a particular matter a lawyer’s professional judgment will be or reasonably may be affected by the lawyer’s own interests. In Obert’s and Knappenberger’s situations, the facts and circumstances did not support a duty to comply with the requirements of DR 5-101(A).
If a lawyer makes a mistake in representing a client, the lawyer should carefully analyze the effect of the mistake on the client and its impact on the lawyer’s ability to exercise independent professional judgment on behalf of the client. A cautious lawyer may wish to make full disclosure to and obtain client consent when the mistake is clear cut and likely difficult to repair. No one has ever been disciplined for making full disclosure and obtaining client consent to proceed when the disclosure may not have been absolutely necessary.
As a related aside, lawyers need, as a general proposition, the permission of courts in which they are appearing to withdraw. If a lawyer makes full disclosure to a client under DR 5-101(A) and the client does not consent to the lawyer’s continued representation, the lawyer must still obtain the permission of the court to withdraw. Absent such permission, the lawyer must proceed. The disciplinary rules do not require a lawyer to violate one rule to comply with another so the court’s direction to the lawyer to proceed should not be problematic concerning a subsequent client conflict of a violation of DR 5-101(A).
© 2004 Scott Morrill
ABOUT THE AUTHOR
Scott Morrill is assistant general counsel for the Oregon State Bar. He can be reached by telephone at (503) 620-0222 or (toll-free in Oregon) at (800) 452-8260, ext. 344. He can also be reached by e-mail at smorrill@ osbar.org.