Can a lawyer defend another lawyer in a malpractice case when the two firms regularly appear against each other as opposing counsel in unrelated matters?

Plain-English summary

Opinion E-87-4 addressed a situation in which a law firm sued for legal malpractice had defense counsel selected by its insurance carrier, and that defense counsel and his firm regularly appeared on the opposite side of unrelated civil litigation, municipal, and divorce matters against the defendant firm. The question was whether the defendant firm or its attorneys had a conflict each time the two firms appeared opposite each other in separate proceedings, whether disclosure could cure it, who must disclose, and whether disclosure would breach confidentiality owed in the malpractice case.

The committee concluded that when counsel for a lawyer-malpractice defendant is offered a retainer by the lawyer's insurance carrier, counsel with whom the defendant lawyer has or likely would have adversary contact as opposing counsel in unrelated matters should decline the representation unless the defendant firm gives informed consent. As the questions implied, the adversary relationship could cause the defendant lawyer to question malpractice counsel's undivided loyalty, and the lawyer's own clients, against whom that counsel appears, could reasonably question whether their lawyer's dependence on opposing counsel for personal representation might affect zealous representation of them.

The committee added that if the carrier had already selected such counsel, or the conflict arose after the representation began, the issue should be addressed through a motion for substitution of counsel. Absent substitution, both firms would have to make disclosures to their clients involved in matters where the other firm represents persons with differing or adverse interests. The committee noted that in some cases the rules of confidentiality (SCR 20.22) and the law of privilege (Wis. Stat. section 905.03) may preclude disclosing client identities as part of a full disclosure; where that occurs, the committee believed both firms must join in a motion to substitute the malpractice counsel.

Currency note

This opinion was issued in 1987, before Wisconsin's July 1, 2007 adoption of the revised Rules of Professional Conduct for Attorneys (the state's Ethics 2000 update), and it expressly notes it was predicated on the existing Code, which the Supreme Court had amended effective January 1, 1988. The conflict, confidentiality, and withdrawal provisions cited have since been renumbered and amended. 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: Can my insurer assign a lawyer to defend me in a malpractice case if that lawyer regularly opposes my firm?

A: The committee concluded that such counsel should decline the representation unless the defendant firm gives informed consent, because the adversary relationship can put malpractice counsel's loyalty in question.

Q: What if the conflict only becomes apparent after the defense is underway?

A: The committee recommended addressing it through a motion for substitution of counsel; absent substitution, both firms would have to disclose the conflict to their affected clients.

Q: What happens if confidentiality prevents the firms from disclosing?

A: The committee believed that where confidentiality or privilege precludes disclosing client identities, both firms must join in a motion to substitute the malpractice counsel.

Background and rules framework

The opinion interpreted the former Code's conflict-of-interest provisions on a lawyer's adverse personal interests and consent (SCR 20.23 and 20.24 / Model Rule 1.7), the confidentiality rule (SCR 20.22 / Model Rule 1.6) read alongside the privilege statute, and the withdrawal and substitution provisions (SCR 20.16(2) / Model Rule 1.16).

Citations and references

Rules of Professional Conduct:

• Wis. SCR 20.23, 20.24 / Model Rule 1.7 (conflicts of interest; consent after disclosure)
• Wis. SCR 20.22 / Model Rule 1.6 (confidentiality)
• Wis. SCR 20.16(2) / Model Rule 1.16 (withdrawal; substitution of counsel)

Statutes:

• Wis. Stat. section 905.03 (lawyer-client privilege)

Cases:

• DeBardeleben v. Ethics Board, 112 Wis. 2d 324, 332 N.W.2d 826 (1983)

Other opinions cited:

• Wisconsin Formal Op. E-83-9

See also

• WI Ethics Op. E-87-3: Former House Counsel Against a Former Employer
• WI Ethics Op. E-89-10: Representing Majority and Minority Investors
• CA COPRAC Op. 2014-190: Duties on Firm Dissolution

Source

• Landing page: https://www.wisbar.org/formembers/ethics/pages/formal-opinions.aspx
• Original PDF: https://www.wisbar.org/formembers/ethics/Ethics%20Opinions/E-87-4.pdf