An incredibly unhelpful ethics opinion from Colorado

Were you looking for something that is very well-written but entirely unhelpful to your needs as a lawyer?  Well, you’ve come to the right place today.

Wait, I now see how that paragraph could be misconstrued in an entirely unflattering way and as an inadvertent passing of judgment on this whole blog.  Obviously, I didn’t mean that.  After all, I said “well-written.”

Anyway, what I’m actually intending to refer to is Colorado Formal Ethics Opinion 134 which was enacted in January 2018 but which was brought to my attention by a loyal reader of this space.  It likely came into his path because of some treatment in the ABA/BNA Lawyers’ Manual which I admittedly have not read beyond their headline and lead sentence, which is as follows:

Advance Agreements on Joint Settlement OK, Colorado Bar Says

A lawyer who represents multiple clients in a case can prepare for them, with informed consent, an agreement stating that a majority vote controls for settlement offers, a recent Colorado bar ethics opinion says.

That is one way to spin the Colorado opinion and draw peoples attention, but studying the opinon itself reveals that the picture being painted is far too rosy because a more fair introduction to the opinion would be:

Advance Agreements on Joint Settlement OK to Memorialize But Lawyer Can’t Enforce It in the Future, Colorado Bar Says

A lawyer who represents multiple clients in a case can prepare for them, with informed consent, an agreement stating that a majority vote controls for settlement offers, a recent Colorado bar ethics opinion says, but what would be the point?  The same opinion explains that if any of the clients later rejects the settlement and refuses to abide by the majority vote then the lawyer doesn’t have settlement authority and can’t continue to represent everybody.

I’m not kidding.  That is the TL/DR version of Colorado Formal Opinion 134.  Don’t believe me, go read it for yourself.

Now, Colorado may feel like it has given a helpful opinion because it distinguishes its opinion from some others by saying it is perfectly ethical for a lawyer to participate in preparing an agreement along these lines for jointly represented clients and explaining how Rule 1.8(g) is not triggered until some future point when a settlement is on the table for consideration.  But . . . geez.  From a practical perspective, it’s an exercise in navel-gazing because of this paragraph of the opinion:

If multiple clients agree in advance on a majority-decision rule for how they will respond to an aggregate settlement proposal, but one client in the future refuses to follow the majority’s decision, the dissenting client might be in breach of that agreement.  The other clients might have claims against the dissenting client.  This circumstance creates an unwaivable conflict for their joint lawyer due to the dispute between in the dissenting client and the other clients.  The lawyer may not take sides in the dispute, and may not seek to enforce the agreement againts the dissenting client, on behalf of the majority clients, by compelling the dissenting client to settle.  The lawyer might need to withdraw from the joint representation entirely.

Because of that, it seems hard to understand how any good Colorado lawyer armed with this opinion could ever respond to an inquiry by joint clients about putting together a majority-rule agreement with any advice other than:

Yeah, you don’t want me to go through all of that.  If anyone changes their mind later, I can’t enforce it and you probably just end up in additional litigation maybe over breaching the contract and you all just end up having to hire more and different lawyers.  So, let’s just wait until we have something in front of us to think about on settlement some day and then work it out if and when that day ever comes around.

 

 

 

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