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End-of-life notice: American Legal Ethics Library

As of March 1, 2013, the Legal Information Institute is no longer maintaining the information in the American Legal Ethics Library. It is no longer possible for us to maintain it at a level of completeness and accuracy given its staffing needs. It is very possible that we will revive it at a future time. At this point, it is in need of a complete technological renovation and reworking of the "correspondent firm" model which successfully sustained it for many years.

Many people have contributed time and effort to the project over the years, and we would like to thank them. In particular, Roger Cramton and Peter Martin not only conceived ALEL but gave much of their own labor to it. We are also grateful to Brad Wendel for his editorial contributions, to Brian Toohey and all at Jones Day for their efforts, and to all of our correspondents and contributors. Thank you.

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Delaware Legal Ethics

1.9 Rule 1.9 Conflict of Interest: Former Client

1.9:100 Comparative Analysis of DE Rule

1.9:101 Model Rule Comparison

DLRPC 1.9 is identical to Model Rule 1.9.

1.9:102 Model Code Comparison

DLPRC 1.9 has no Model Code counterpart. However, EC 4-6 states that the “obligation of a lawyer to preserve the confidences and secrets of his client continues after the termination of employment.”

Similar to 1.9(a) and (b), DR 5-105(c) discusses waiver by the former client. Both the Model Code and 1.9(c)(1) allow a lawyer to use former client information that is “generally known” or available to the public. DLRPC 1.9(a) and (b) are much broader than their counterpart in the Model Code. DLRPC 1.9 protects former client communications and information. The Model Code only protects “confidences and secrets.”

1.9:200 Representation Adverse to Interest of Former Client—In General

Comment [2] states that “The underlying question is whether the lawyer was so involved in the matter that the subsequent representation can be justly regarded as a changing of sides in the matter in question.” DLRPC 1.9 cmt. 2.

In a motion to disqualify counsel for a conflict of interest, the following four elements are required: (1) an attorney client relationship with the former client; (2) the former client’s matter is the same or substantially related to the current client’s matter; (3) the current client’s interests are materially adverse to the former client; and (4) the former client did not consent to the current client’s representation. See Nemours Foundation v. Gilbane, Aetna, Federal Ins. Co., 632 F. Supp. 418, 422 (D. Del 1986).

The comments to DLRPC give examples of impermissible conduct under DLRPC 1.9. For example, if a lawyer drafted a contract for a former client, the lawyer could not represent a client who seeks to rescind the same contract. Also, a lawyer cannot prosecute the accused in one case, and in a subsequent civil action represent the accused against the government. DLRPC 1.9 cmt. 1.

1.9:210 “Substantial Relationship” Test

To determine whether the prior attorney/client relationship is “substantially related” to the current matter, the Court must ask: “(1) what is the nature and scope of the prior representation; (2) what is the nature and scope of the present lawsuit; (3) whether the client might have disclosed confidences to counsel in the course of the prior representation that were relevant to the action, and if so, could those confidences be detrimental to the former client in the current litigation.” Bowden v. Kmart Corp., 1999 Del. Super. LEXIS 423 at *4 (Del. Super. July 1, 1999) citing J.E. Rhoads & Sons, Inc. v. Wooters, 1996 Del. Ch. LEXIS 4 at *7 (Del. Ch. January 24, 1996). The burden of proving a “substantial relationship” rests on the moving party. Bowden, 1999 Del. Super. LEXIS 423 at *7.

If a lawyer represents a client in “securing environmental permits to build a shopping center,” then the lawyer can not represent neighbors opposing the permit. But the lawyer would not be precluded by “substantial relationship” from defending a shopping center tenant in an eviction notice. DLRPC 1.9 cmt. 3.

In Acierno v. Hayward, the attorney was disqualified from representing Acierno against DelDOT, the lawyer’s former client. In this case, the lawyer represented DelDOT in a condemnation action against the current client, Acierno. The lawyer represented DelDOT in the “negotiation and drafting” of the settlement agreement over the condemnation of the land at issue. Acierno v. Hayward, 2004 Del. Ch. LEXIS 138 at *20 (Del. Ch. July 1, 2004).

Now, the lawyer seeks to use the settlement claims against DelDOT in support of Acierno’s claim. Among other things, the Court concluded that the former matter and the current matter were “substantially related.” The attorney’s disqualification was imputed to his firm under DLRPC 1.10. Id. at *1-*30.

It was impermissible for the lawyer to represent the wife in a divorce proceeding against the husband. The lawyer represented the wife in her 1982-1984 divorce, and represented the husband in a 1987 divorce. The wife and the husband married, and subsequently separated in 1991. In the divorce proceeding, the lawyer agreed to represent the wife, and the husband did not object. Eventually, the husband’s counsel objected, and the lawyer was ordered to withdrawal. Here, the divorce actions were “substantially related” because the lawyer received confidential information about the husband in a prior case. The confidential information could have been used to the husband’s detriment in this divorce proceeding. Private Admonition-Board Case No. 12, 1992. Date of Sanction: September 30, 1992.

The lawyer simultaneously represented two clients in the formation of a corporation. The lawyer advised the clients on procedures to form the corporation, drafted the appropriate formation documents, and arranged for the proper filing of the documents. Several years later, the lawyer represented one of the former clients in negotiations to purchase the other former client’s interest in the corporation. The lawyer did not obtain consent. The buy-out negotiations were “substantially” related to the previous business formation representation. The lawyer was privately admonished, and ordered to pay the cost of the investigation incurred by the Office of Disciplinary Counsel. Private Admonition-Board Case No. 46, 1992. Date of Sanction: Jan. 28, 1994.

1.9:220 Material Adversity of Interest

The lawyer was disciplined for representing parties whose interests were clearly adverse to the former client. Here, the lawyer represented the president of a corporation for estate planning. The president decided that, upon his death, he wanted the number two person at the corporation to maintain control of the corporation. The president died. The president’s widow and personal representative of his estate (“PR”) retained the lawyer. The lawyer failed to consult with the clients about potential conflicts between the corporation and the widow/estate. Thus, the lawyer failed to receive the necessary consent from the parties. The widow expressed her concern about the corporation, and the lawyer withdrew, but continued representing the corporation. Consequently, a dispute arose between the estate and the corporation. The lawyer was concerned that he would be called as a witness. For this dispute the lawyer referred the corporation to other counsel. However, the lawyer continued to act on behalf of the corporation. Also, the lawyer represented others with adverse interests to the estate and PR. The PR formally asked the lawyer to withdraw from representing the adverse parties. The lawyer denied that he owed any duty to the former client. The lawyer did not honor the PR’s request and continued to represent parties whose interests were clearly adverse to the estate and widow. The lawyer was disciplined under DLRPC 1.9. Private Admonition-Board Case No. 10, 1999. Date of Sanction: May 17, 1999.

The public defender’s office moved to disqualify itself as defendant’s counsel because an assistant public defender claimed that one of her clients was a potential adverse witness to the defendant. The client harbored the defendant while he was a fugitive. The client most likely obtained information adverse to the defendant. It was unlikely that the client would be called as a witness against the defendant, so the motion to disqualify was denied. Nevertheless, in order for the defendant’s representation to continue, the client and the defendant would be asked to sign a waiver in order to ensure fairness. State v. Sykes, 2005 Del. Super. LEXIS 172 at *1-*10 (Del. Super. May 2, 2005).

1.9:230 Relevance of “Appearance of Impropriety” Standard [see also 1.7:230]

DLRPC 3.7(b) states, “A lawyer may act as advocated in a trial in which another lawyer in the lawyer’s firm is likely to be called as a witness unless precluded from doing so by Rule 1.7 or Rule 1.9.

In Cardoni v. Power International, while plaintiff was the CEO of Power, Dennison Hatch (of MNA&T) “served as general counsel for Power and Silicates,” and “played some part in drafting the contract presently in dispute, sat on the Board, and was involved in the decision to terminate plaintiff’s employment.” Cardoni v. Power Int’l, 1990 Del. Super LEXIS 105 at *1-*2 (Del. Super. March 27, 1990). The defendants wanted another lawyer from MNA&T to represent them against the plaintiff. The plaintiff argued that Rule 1.9 precluded this representation because Mr. Hatch (of MNA&T) previously advised plaintiff. Id. at *3; See DLRPC 3.7(b). The Court did not disqualify counsel because the “record before the court” did not show the “scope and nature” of the prior representation. Id. at *5. The Court could not make a decision without “undue speculation.” Id.

1.9:300 Client of Lawyer’s Former Firm

1.9:310 Removing Imputed Conflict of Migratory Lawyer

A potential conflict does not exist unless the lawyer involved in the former representation has “actual knowledge” of information relating to a particular client. DLRPC 1.9 cmt. 5.

1.9:320 Former Government Lawyer or Officer [see 1.11:200]

1.9:400 Use or Disclosure of Former Client’s Confidences

The former client is “not required to reveal the confidential information learned by the lawyer in order to establish a substantial risk that the lawyer has confidential information to use in the subsequent matter.” DLRPC 1.9 cmt. 3.

In Battaglia v. Battaglia, the wife consulted the lawyer about a divorce. The lawyer subsequently wished to represent the husband in the same divorce proceeding against the wife. The wife and husband’s interests were materially adverse, and the wife did not consent to the representation. In order for a lawyer to be disqualified under DLRPC, the court concluded that: (1) an attorney-client relationship must have existed between the client and attorney; and (2) if the relationship existed the Court will conclusively presume that confidential information was disclosed. Battaglia v. Battaglia, 1998 Del. Fam. Ct. LEXIS 177 at *6 (Del. Fam. Ct. December 23, 1998). A hearing was rescheduled to determine if an attorney-client relationship existed. Battaglia v. Battaglia, 1998 Del. Fam. Ct. LEXIS 177 at *8 (Del. Fam. Ct. December 23, 1998).

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