May a plaintiff's lawyer contact insured defendants directly to warn them that the verdict may exceed their policy limits and that they should hire personal counsel?

Plain-English summary

A minor driving his father's car caused an accident with serious injuries, and the injured person sued both the minor and the parent. The injuries suggested a verdict possibly exceeding the insurance coverage, and the insurer provided counsel to defend the minor and parent under the policy. Plaintiff's counsel asked whether he could communicate directly with the parent or minor during the suit, whether the excess-exposure changed that, whether he could advise them to obtain personal counsel for the amount above the policy limits, and whether he could deal directly with them if they did not designate personal counsel or affirmatively request the insurer's counsel to represent them for the coverage.

The Committee set aside the procedural questions about the minor's representation, treating the minor as represented by a guardian, and applied Canon 9, which provides that a lawyer should not communicate on the subject of the controversy with a party represented by counsel, and should deal only with that party's counsel. It held that this canon applies in all cases, including where defense counsel is furnished under an automobile casualty policy, quoting ABA Opinion 108 (1934) and a New York County Lawyers' Association opinion holding that the insurer's furnishing of counsel does not change the prohibition.

Applying that rule, the Committee concluded that the defendants would be well served by being advised of the possibility of damages exceeding the insurance coverage, and that it would indeed be proper for plaintiff's counsel to give that notice, provided he did so through the defendants' insurance counsel rather than directly.

Currency note

This opinion was issued in July 1965, before New Jersey's September 13, 1971 adoption of the Disciplinary Rules (Code of Professional Responsibility), and well before the 1984 Rules of Professional Conduct and all later revisions. It applied Canon 9 of the Canons of Professional Ethics on communicating with a represented party. That subject is now treated under RPC 4.2 (represented persons) and RPC 4.3 (unrepresented persons). Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific requirement mentioned here.

Common questions

Q: Could plaintiff's counsel contact the insured defendants directly?

A: No. The Committee held Canon 9 barred direct communication with a party represented by counsel, and that the insurer's furnishing of defense counsel did not change the prohibition.

Q: Could plaintiff's counsel warn the defendants about an excess verdict?

A: Yes, but only through their insurance counsel. The Committee said the defendants would be well served by the warning and that it was proper to give it, provided it went through the defendants' insurance counsel.

Q: Did it matter that the insurer, not the defendants, hired the lawyer?

A: No. The Committee, quoting a New York County Lawyers' Association opinion, said the fact that counsel is furnished by the insurer does not change the prohibition on contacting a represented party.

Background and rules framework

The opinion applied Canon 9 of the Canons of Professional Ethics, which barred a lawyer from communicating on the subject of the controversy with a party represented by counsel and directed dealing only with that party's counsel, and treated insurer-furnished defense counsel as counsel for this purpose. In current New Jersey terms, contact with represented and unrepresented persons is governed by RPC 4.2 and RPC 4.3.

Citations and references

Cases:

• Radio Taxi Service, Inc. v. Lincoln Mutual Insurance Co., 31 N.J. 299, 313 (N.J. 1960), cited (Justices Jacobs and Burling, dissenting on other grounds)

Other authorities:

• Canons of Professional Ethics, Canon 9 (communicating with a represented party)

Other opinions cited:

• ABA Committee on Professional Ethics and Grievances, Opinion 108 (1934): the bar on contacting a represented party is wise and should be obeyed
• New York County Lawyers' Association, Answer to Question No. 531 (May 10, 1965): insurer-furnished counsel does not change the prohibition

See also

• NJ ACPE Op. 194: Representing a Client and Adverse Witnesses
• NJ ACPE Op. 241: Merged Legal Services Projects and Opposing Parties

Source

• Landing page: https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp81-1.html

Original opinion text

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

88 N.J.L.J. 469
July 22, 1965

OPINION 81

Communication with Opposing Parties

An inquirer presents the following factual situation.

A minor driving his father's car becomes involved in an accident resulting in serious injury to a third person and a suit for damages against both minor and parent. The severity of the injuries indicates the possibility of a verdict in excess of insurance coverage. Under terms of the policy, the insurance company provides counsel to represent the minor and his parent.

On these facts, the inquirer asks:

A. May the attorney for the plaintiff communicate directly with the parent or infant during the pendency of the suit?

B. Would the fact that the possible damages are substantially in excess of the applicable policy limits be a factor in this decision?

C. May the attorney for the plaintiff advise the father and the infant that, because of the likelihood of the excess verdict, they should obtain personal counsel to represent them for the amount above the policy limits?

D. In the event that personal counsel is not designated by the infant and parent, or they do not affirmatively request the counsel designated by the insurance company to represent them for the coverage, may the attorney for the plaintiff then deal directly with the parent and infant?

The position of the minor as a party defendant involves questions of procedural law on which we will not comment. The questions will herein be treated as though the minor was represented by an appropriate guardian with no basis for any distinction in the ethical questions raised.

Canons of Professional Ethics, Canon 9 is relevant to the questions raised. It provides:

A lawyer should not in any way communicate upon the subject of controversy with a party represented by counsel; much less should he undertake to negotiate or compromise the matter with him, but should deal only with his counsel. It is incumbent upon the lawyer most particularly to avoid everything that may tend to mislead a party not represented by counsel, and he should not undertake to advise him as to the law.

This canon applies to counsel in all cases including those where defense counsel is furnished under automobile casualty insurance policies.

The first sentence above quoted is clear and convincing. The reasons for such a prohibition are equally clear. They arise out of the nature of the relation of attorney and client and are equally imperative in the right and interest of the adverse party and of his attorney. To preserve the proper functioning of the legal profession as well as to shield the adverse party from improper approaches the Canon is wise and beneficent and should be obeyed. A.B.A. Comm. on Professional Ethics and Grievances, Opinion 108 (1934).

The Committee on Professional Ethics of the New York County Lawyers' Association in answer to a similar question recently gave its opinion as follows:

Of course, after the insured is represented by counsel, the same Canon provides that an attorney should not communicate upon the subject of controversy with a party represented by counsel. We do not believe that the fact that the counsel is furnished by the insurer changes the prohibition. Answer to Question No. 531, May 10, 1965.

Also see Radio Taxi Service, Inc. v. Lincoln Mutual Insurance Co., 31 N.J. 299, 313 (1960), opinion of Justices Jacobs and Burling, dissenting on other grounds.

In the particular circumstances on which the inquiries are based, it is the opinion of this Committee that the defendants would be well served if they were advised of the possibility of damages exceeding the insurance coverage. It would indeed be proper for plaintiff's counsel to so notify defendants provided, however, that he did so through defendants' insurance counsel.