Ethics update
By Jonathan Bishop
This section highlights recent developments in attorney professional responsibility,
including new cases, advisory ethics opinions, pending legislation and proposed
rule amendments.
CASES
BGJ Associates, LLC v. Wilson, (Dec 3, 2003) 2003 WL 22853071,
2003 Cal. App. LEXIS 1789.
After an attorney was retained by the client to file a lawsuit seeking a prescriptive
easement to certain property, the attorney entered into an oral joint venture
with the client and another party for the purpose of buying the property. In
doing so, the attorney did not obtain the client's informed written consent
to the transaction.
In affirming a judgment that the joint venture agreement was voidable and unenforceable,
the 2nd District Appellate Court found that the attorney's conduct violated
rule 3-300 of the California Rules of Professional Conduct.
The court also relied upon Cal. Prob. Code §16004 in finding that the
joint venture was a transaction between a fiduciary and beneficiary subject
to a presumption of undue influence.
The court further found that the attorney could not overcome the presumption
of undue influence as the terms of the transaction were not fair and reasonable
to the client.
Snider v. Superior Court, (Dec 3, 2003) 2003 WL 22853650,
2003 Cal. App. LEXIS 1790.
The 4th district appellate court issued a writ of mandate directing the trial
court to vacate its order disqualifying a former employee's attorney in a trade
secret and unfair competition case, finding the attorney's contacts with two
of the respondent's employees did not violate California Rule of Professional
Conduct 2-100 which prevents ex parte contact with represented parties.
Under the facts presented, the court reasoned Rule 2-100(B)(1) did not prohibit
contacts with employees other than officers, directors and managing agents,
and that Rule 2-100(B)(2) applied to management-level employees who had actual
authority to speak on behalf of the organization or who could bind it, within
the meaning of Cal. Evidence Code §1222, with regard to the subject matter
of the litigation.
The court found that the two interviewed employees, a sales manager and a production
department supervisor, were not managing agents because they did not exercise
substantial discretionary authority over organizational policymaking and could
not make admissions binding on the organization.
Glassman v. McNab, (Nov 4, 2003) 112 Cal.App.4th 1593, 6 Cal.Rptr.3d
293.
In affirming the trial court's order which confirmed an arbitration award in
favor of the attorney, the court held that California Business & Professions
Code §6200 et seq., governing arbitration of disputes as to attorney fees,
allowed parties to enter into an agreement that authorized arbitrators to determine
the existence of an attorney-client relationship.
Under §6203(a), the arbitration award includes a determination of all
the questions submitted to the arbitrators. Here, the parties executed a written
stipulation for binding arbitration, which included an express notation that
jurisdiction and attorney-client relationship were issues in the proceeding
and that rulings thereon were binding as provided by law.
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