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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.


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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