South Carolina Legal Ethics
1.2 Rule 1.2 Scope of Representation
1.2:100 Comparative Analysis of South Carolina Rule
• Primary SC References: SC
Rule 1.2
• Background References: ABA
Model Rule 1.2, Other Jurisdictions
• Commentary:
1.2:101 Model Rule Comparison
South Carolina Rule 1.2 and its comments are identical to Model Rule 1.2.
1.2:102 Model Code Comparison
Rule 1.2 did not have an exact counterpart in the Code of Professional Responsibility.
1.2:200 Creating the Client-Lawyer Relationship
• Primary SC References: SC
Rule 1.2
• Background References: ABA
Model Rule 1.2, Other Jurisdictions
• Commentary: ABA/BNA § 31:101, ALI-LGL §§ 26-29A,
Wolfram § 9.2
1.2:210 Formation of Client-Lawyer Relationship
An attorney-client relationship may arise in a variety of situations even without an engagement agreement and even if the attorney fails to recognize the existence of the relationship. For example, in In re Pyatt, 280 S.C. 302, 312 S.E.2d 553 (1984), the court rejected the argument that a lawyer had not understood the sellers of a property to be the lawyer's clients when the lawyer arranged a sale to relatives of the lawyer to avoid foreclosure. The sellers looked to the lawyer to be their attorney, and the lawyer should have explained to them that such was not the case. Similarly in In re Morgan, 288 S.C. 401, 343 S.E.2d 29 (1986), the lawyer agreed to sell a house in exchange for a percentage of the sales price. Legal title was held by four individuals, although their father, who had deeded the land to them, occupied the house and dealt with the lawyer. The father was held to be a client, as were all four legal owners, who were paying the legal fee out of the sales proceeds of their interests. The lawyer was reprimanded for misconduct stemming from a failure to understand who was the client.
Lawyers have an obligation to clarify the nature of their relationship; their failure to do so may result in discipline. In In re Warder, 316 S.C. 249, 449 S.E.2d 489 (1994), the client did not sign a representation agreement until after the time period had passed for answering a summons and complaint. The lawyer argued that he did not believe an attorney-client relationship had been created earlier, but acknowledged that he had "failed to ensure that . . . [the purported client] understood the situation." A lawyer may be faulted for failing to be sufficiently "definitive in . . . conversations with . . . [the potential client] regarding the nature of their attorney-client relationship." In re Larkin, 320 S.C. 512, 466 S.E.2d 355 (1996). Larkin unsuccessfully argued that he had not been retained as counsel by the grievant. S.C. Bar Ethics Adv. Op. # 97-45 (initial interview in which lawyer turns down representation because of conflict of interest does not create attorney-client relationship when lawyer did not receive confidential information).
Fee payment arrangements do not always reflect the attorney-client relationships that may exist. One person's agreement to guarantee the payment of another's legal expenses does not alone "give rise to an employment relationship" between the lawyer and the guarantor. Marshall v. Marshall, 282 S.C. 534, 320 S.E.2d 44 (Ct. App. 1984).
In multi-party transactions, attorneys can have multiple clients. When a lawyer is the only lawyer present at a real estate closing, the lawyer may represent the interests of various parties including a mortgage broker. See S.C. Bar Ethics Adv. Op. # 90-30. For a discussion of the lawyer's role as an agent for various parties at a closing, see Citizens Savings Bank, F.S.B. v. Verex Assurance, Inc., 883 F.2d 299 (4th Cir. 1989); Costas v. First Fed. Sav. & Loan Assoc., 283 S.C. 94, 321 S.E.2d 51 (1984); and Jones v. Thomas and Hill, Inc., 265 S.C. 66, 216 S.E.2d 871 (1975). A question also may arise as to whether a lawyer who acts as title insurance agent in a real estate closing also represents the insurance company. See S.C. Bar Ethics Adv. Op. # 92-03 (whether a lawyer serving as title agent is also attorney for the insuror is a matter of law, but it does not appear that an attorney-client relationship ordinarily is created). In tort cases, a lawyer hired to represent an insured party may represent only the insured or both the insured and the insuror. See S.C. Bar Ethics Adv. Op. # 90-44. Similar issues can arise in bankruptcy proceeding. See S.C. Bar Ethics Adv. Op. # 90-09 (a lawyer acting only as a trustee in bankruptcy is not engaged in an attorney-client relationship with the creditors or debtors of the estate).
1.2:220 Lawyer's Duties to Prospective Client
An attorney-client relationship may arise from a discussion with a potential client regarding a matter, even when the lawyer is never formally retained. See S.C. Bar Ethics Adv. Ops. # 88-11, 89-19. However, an initial consultation does not always create an attorney-client relationship. See S.C. Bar Ethics Adv. Op. # 91-03.
1.2:230 When Representation Must Be Declined [see 1.16:200-230]
1.2:240 Client-Lawyer Agreements
An attorney-client relationship can be formed even when the lawyer and client do not enter into a formal engagement agreement. See 1.2:210. The terms of an engagement agreement will often control the relationship between lawyer and client. For example, the agreement may determine the scope of the lawyer's representation. See S.C. Rule 1.2(c). The agreement may specify the fees that the client will pay subject to the general standard of reasonableness. See S.C. Rule 1.5. A lawyer and client may agree that the lawyer will have a lien on the amount of any judgment or settlement to secure payment of fees and expenses. See Eleazer v. Hardaway Concrete Co., Inc., 281 S.C. 344, 315 S.E.2d 174 (Ct. App. 1984)
1.2:250 Lawyer's Duties to Client in General
See discussion throughout this narrative.
1.2:260 Client's Duties to Lawyer
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1.2:270 Termination of Lawyer's Authority
When a lawyer is counsel of record, the lawyer must make a motion to be relieved of counsel. The lawyer's representation does not terminate until the court grants the motion. See S.C. R. Civ. Proc. 11(b); Culbertson v. Clemens, 322 S.C. 20, 471 S.E.2d 163 (1996); Ex parte Strom, 334 S.C. 605, 514 S.E.2d 599 (Ct. App. 1999). On the termination of a lawyer's authority when the lawyer is discharged see 1.16:210.
1.2:300 Authority to Make Decisions or Act for Client
• Primary SC References: SC
Rule 1.2(a)
• Background References: ABA
Model Rule 1.2(a), Other Jurisdictions
• Commentary: ABA/BNA § 31.301, ALI-LGL §§ 32-34,
37-41, Wolfram §§ 4.4, 4.6
1.2:310 Allocating Authority to Decide Between Client and Lawyer
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1.2:320 Authority Reserved to Client
South Carolina Rule 1.2(a) provides that in a civil case a lawyer shall abide by a client's decision whether to accept an offer of settlement. If a lawyer enters into an unauthorized settlement, however, the client may be bound by the settlement, although the lawyer may be liable to the client for damages. See 1.2:340. South Carolina Rule 1.2(a) also provides that in criminal cases a lawyer shall abide by a client's decision regarding the plea to be entered, whether to waive a jury trial and whether the client will testify.
1.2:330 Authority Reserved to Lawyer
South Carolina Rule 1.2(a) states that a lawyer shall consult with a client as to the means by which a client's objectives are pursued. Lawyers, however, have authority to make decisions about the tactics to be used in a case. In Palacio v. State, 333 S.C. 506, 511 S.E.2d 62 (1999), during jury selection, defendant instructed his lawyer to strike a juror because the juror was an attorney. Defense counsel refused to do so. Defendant later claimed this refusal as ineffective assistance of counsel. The court rejected this argument, stating that "jury selection is a process that inherently falls within the expertise and experience of trial counsel. . . . [A] criminal defendant has no right to a trial by any particular jury, but only a right to a trial by a competent and impartial jury."
1.2:340 Lawyer's Authority to Act for Client
The acts of attorneys are directly attributable to and binding on their clients through principles of agency law. Collins v. Bisson Moving & Storage, Inc., 332 S.C. 290, 504 S.E.2d 347 (Ct. App. 1998). Lawyers have authority to settle cases on behalf of their clients. Such settlements are binding absent fraud or mistake. Arnold v. Yarborough, 281 S.C. 570, 316 S.E.2d 416 (Ct. App. 1984). The lawyer's authority is limited, however, to claims set forth in the pleadings, and any settlement that goes beyond the pleadings must be expressly agreed to by the client. Graves v. Serbin Farms, Inc., 295 S.C. 391, 368 S.E.2d 682 (Ct. App. 1988). A lawyer who enters into a settlement without client authority may be liable to the client for negligent advice with regard to the settlement. Crowley v. Harvey & Battey, P.A., 327 S.C. 68, 488 S.E.2d 334 (1997). To be binding a settlement agreement must comply with S.C. R. Civ. Proc. 43(k), which provides: "No agreement between counsel affecting the proceedings in an action shall be binding unless reduced to the form of a consent order or written stipulation signed by counsel and entered in the record, or unless made in open court and noted upon the record." Ashfort Corp. v. Palmetto Const. Group, Inc., 318 S.C. 492, 458 S.E.2d 533 (1995).
1.2:350 Lawyer's Knowledge Attributed to Client
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1.2:360 Lawyer's Act or Advice as Mitigating or Avoiding Client Responsibility
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1.2:370 Appearance Before a Tribunal
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1.2:380 Authority of Government Lawyer
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1.2:400 Lawyer's Moral Autonomy
• Primary SC References: SC
Rule 1.2(b)
• Background References: ABA
Model Rule 1.2(b), Other Jurisdictions
• Commentary: Wolfram § 10.4
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1.2:500 Limiting the Scope of Representation
• Primary SC References: SC
Rule 1.2(c)
• Background References: ABA
Model Rule 1.2(c), Other Jurisdictions
• Commentary: ABA/BNA § 31:301, ALI-LGL § 30, Wolfram
§ 5.6.7
1.2:510 Waiver of Client or Lawyer Duties (Limited Representation)
In S.C. Bar Ethics Adv. Op. # 99-11 the Ethics Advisory Committee ruled that a lawyer who handled residential real estate closings in which the closing documents provided that Delaware law applied to the transaction could enter into a limited engagement agreement with his clients under which the lawyer would not provide advice about Delaware law. See also S.C. Bar Ethics Adv. Op. # 93-23 (limited engagement agreement between borrower and lender permitted in real estate transactions). The Ethics Advisory Committee has also considered whether a defense lawyer in a wreck case may agree not to handle negotiations of settlement. Settlement is a common objective of legal representation in personal injury case, but, the opinion concludes, a defendant may direct a lawyer only to prepare a matter for trial and not to be involved in any settlement discussions. See S.C. Bar Ethics Adv. Op. # 90-44. However, unless the client so directs, it would be improper for the lawyer to agree with the client's insuror that the lawyer will not engage in settlement discussions.
1.2:600 Prohibited Assistance
• Primary SC References: SC
Rule 1.2(d)
• Background References: ABA
Model Rule 1.2(d), Other Jurisdictions
• Commentary: ABA/BNA § 31:301, ALI-LGL § 151, Wolfram
§ 13.3
1.2:610 Counseling Illegal Conduct
Rule 1.2(d) does impose some limitations on the content of a lawyer's communications to a client. A lawyer may not "counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent." Rule 1.2(d). Thus, a lawyer may not, for example, participate in a transaction designed to allow the client to escape tax liability by criminal or fraudulent means. Rule 1.2, cmt. If the lawyer discovers during the representation that conduct originally believed to be lawful is not lawful, the lawyer should seek to withdraw from the representation. Id.
1.2:620 Assisting Client Fraud
Rule 1.2(d) forbids a lawyer from assisting a client in known fraudulent conduct. See In re Dobson, 310 S.C. 422, 427 S.E.2d 166 (1993) (lawyer signed documents in blank that assisted client's fraudulent scheme); In re Shelley, 305 S.C. 180, 407 S.E.2d 626 (1991) (lawyer permitted client to sign name of client's spouse to joint settlement check and release). See also Rule 1.16(b), which permits withdrawal by a lawyer who believes the client is using the lawyer's services to pursue fraudulent conduct.
1.2:630 Counseling About Indeterminate or Uncertain Law
One issue, of course, may be whether the lawyer has actual knowledge that certain conduct is illegal so as to fall within the proscription of Rule 1.2. The Rule expressly permits a lawyer to discuss "the legal consequences of any proposed course of conduct with a client" and to participate in "a good faith effort to determine the validity, scope, meaning or application of the law." Rule 1.2(d). The comment elaborates that there is "a critical distinction between presenting an analysis of legal aspects of questionable conduct" and recommending how to commit a crime or fraud "with impunity." Rule 1.2, cmt. See John Freeman, Standing up to the Client, S.C. LAW., March-Apr. 1999, at 10 (discussing how lawyers should fulfill their counseling duties with regard to client fraud or deception, by advising clients "aggressively and without apology").
1.2:700 Warning Client of Limitations on Representation
• Primary SC References: SC
Rule 1.2(e)
• Background References: ABA
Model Rule 1.2(e), Other Jurisdictions
• Commentary: ABA/BNA § 31:301, ALI-LGL § 165
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1.2:800 Identifying to Whom a Lawyer Owes Duties
• Primary SC References: SC
Rule 1.2
• Background References: ABA
Model Rule 1.2, Other Jurisdictions
• Commentary: ABA/BNA § 31:101, ALI-LGL §§ 72, 73,
155, 156A, Wolfram § 7.2
1.2:810 Prospective Clients [see 1.2:220]
1.2:820 Persons Paying for Representation of Another [see 1.7:400]
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1.2:830 Representing an Entity [see also 1.13:200]
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1.2:840 Representing a Fiduciary [see also 1.13:520]
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1.2:850 Class Action Clients
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