PR Overview• Fiduciary principles

– Agency law– 2005 ABA Model Rules

• Duty of loyalty– Confidentiality– Fidelity

• Duty of care

• Duty of confidentiality

PR Overview

• Judgment– Practical reasoning taking into account

interactions among all relevant interests

Sources and Scope of Liability

GovernmentInstitution

Related Party

Rules ofProfessional Conduct

Your client(fiduciary Rules)

GeneralLegal rules

The Web

Lawyer

ClientRelated parties

Agencies Tribunals

Survival rules of thumb

• 1. Never create a duty you don’t intend to create

• 2. Always be prepared to walk away• 3. Assume that everything you do or say

will become publicly known• 4. Never mistake the client’s problem for

yours (stay calm)• 5. Never do anything as a lawyer that you

find repugnant as an ordinary person

Agency and fiduciary overview

Fiduciary duty

• “A fiduciary duty is the duty of an agent to treat his principal with the utmost candor, rectitude, care, loyalty, and good faith--in fact to treat the principal as well as the agent would treat himself.”

Burdett v. Miller, 957 F.2d 1375 (7th Cir. 1992) (Posner, J)

Fiduciary duty

• (1)  Agency is the fiduciary relation which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act.

• (2)  The one for whom action is to be taken is the principal.

• (3)  The one who is to act is the agent.

Agency and fiduciary dutyP

A 3P

Fiduciary aspect of agency

Reliance/binding aspect of agency

7108 West Grand Ave.

• What is the procedural posture of this case?• What was the plaintiffs’ argument?• How did Judge Easterbrook characterize the

legal problem?• What was Judge Easterbrook’s argument for

not letting Habib and his clients off the hook?• What does this argument imply about the

lawyer’s role?

Tante v. Herring

• Did Tante commit malpractice? • Did Tante breach a contract with the

Herrings?• What does it mean to say Tante is a fiduciary

with regard to information he gets from his client?

• What should Tante have done to fulfill his duty of good faith & loyalty?

• What is the relationship between the fiduciary cause of action and disciplinary rules?

Tante v. Herring

Rule violationsFiduciarybreaches

Tante

Barbara A v. John G

• What does the Court see as “the essence” of a fiduciary relationship?

• What part of the case does the Court say the attorney-client relationship is relevant to?

• How would the plaintiff’s case be affected if fiduciary standards apply to her claims?

• What question is to be addressed on remand?

Fiduciary duty

• “A fiduciary duty is the duty of an agent to treat his principal with the utmost candor, rectitude, care, loyalty, and good faith--in fact to treat the principal as well as the agent would treat himself.”

Burdett v. Miller, 957 F.2d 1375 (7th Cir. 1992) (Posner, J)

Fiduciary duty

• (1)  Agency is the fiduciary relation which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act.

• (2)  The one for whom action is to be taken is the principal.

• (3)  The one who is to act is the agent.

Authority

AUTHORITY

• Power—– Ability to change legal status by act or

omission (7108 W. Grand Ave.)

• Authority– Power created by principal’s assent

that agent act for principal

• Two types of relevant authority:– Actual authority– Apparent authority

Actual Authority

• Express: agreement of lawyer/client• Implied in fact: because of the nature of

the representation• Implied in law: because presumed by law.

P

A 3P

AgreementRstmt §23MR 1.2(a)

Apparent Authority

• Created by acts of the principal with respect to a third party that lead the third party to believe, reasonably, that the agent has authority to do the act in question.

P

A 3P

AgreementRstmt §23MR 1.2(a)

Acts by P expressing to 3P that A may act for P with regard to 3P; Rstmt §27

AuthorityP

A 3P

AgreementRstmt §23MR 1.2(a)

Acts by P expressing to 3P that A may act for P with regard to 3P; Rstmt §27

Ability to act as and for client;Risk of liability for mis-stated authority;Undisclosed client contractual liability; Rstmt §30

Authority

AgreementRstmt §23MR 1.2(a)

Acts by P with regard to 3P

Rstmt§31

Death,Discharge,End of matterWithdrawal

Limiting the scope of representation

Scope of representation

Issues relevantto client

Rule 1.2

(a) Subject to paragraphs (c) and (d), a lawyer shall abide by a client’s decisions concerning the objectives of representation and, as required by Rule 1.4, shall consult with the client as to the means by which they are to be pursued. A lawyer may take such action on behalf of the client as is impliedly authorized to carry out the representation. A lawyer shall abide by a client’s decision whether to settle a matter. In a criminal case, the lawyer shall abide by the client’s decision, after consultation with the lawyer, as to the plea to be entered, whether to waive jury trial and whether the client will testify.

Client Calls (MR 1.2(a))

• Civil Cases– Settlement

– Costs

• Criminal Cases– Plea

– Jury trial

– Testimony

Rule1.4(a) A lawyer shall:

(1) Promptly inform the client of any decision or circumstance with respect to which the client’s informed consent, as defined in Rule 1.0(e), is required by these rules;

(2) Reasonably consult with the client about the means by which the client’s objectives are to be accomplished;

(3) Keep the client reasonably informed about the status of the matter;

(4) Promptly comply with reasonable requests for information; and

(5) Consult with the client about any relevant limitation on the lawyer’s conduct when the lawyer knows that the client expects assistance not permitted by the Rules of Professional conduct or other law.

Rule1.4

(b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.

In re Grievance Proceeding

• What does the agreement in question provide?

• Who drafted it?• What did the Grievance Committee conclude

about Rule 1.2(a) in conjunction with Rule 1.4?

• Did the attorney actually enforce this agreement by keeping information from the client in question?

• Is this just a rule of discipline?

In re Grievance Proceeding

• As a matter of interpretation, how does the court read MR 1.2? Literally/formally? Purposively?– Cf Preamble para. 14: The rules of professional

conduct are rules of reason. They should be interpreted with reference to the purposes of legal representation and of the law itself.

• Why no discipline?– What purposes does discipline serve?– What about compensation?

FennelFennel

Brewington Frink

AgreementRstmt §23MR 1.2(a)

Acts by P expressing to 3P that A may act for P with regard to 3P; Rstmt §27

Fennell

• Very straightforward apparent authority opinion: representative case

• Note conflicting perspectives:– District court views interaction from its own

perspective/that of lawyers—settlements like this happen all the time; this is what lawyers do; otherwise mild chaos

– CTA2 sees it from lawyers perspective, too, but relative to the client, not the docket

• Look at the language of the 3/20 letter from Brewington (p.21); what is going on there?

The Web II

Brewington

FennellOther lawyers

Agencies Tribunals

Fiduciary obligations, but annoyed at client for complaining abt settlement

Reputational stake with court; and opposing counsel

Blanton

• Note the time between the first trial date and the second, and between the arbitration agreement and the second trial date– What is going on here?

• Look at the terms of arbitration; what do they tell you?

• This is “doubling down”

The Web III

Harris

BlantonRelated parties

Agencies Tribunals

Rejection of bindingArb. = no authority

Severe pressure: go to trial now or agree to binding arb.

Blanton

• What is Ms. Blanton’s ground for objecting to arbitration?

• Note the competing interests at stake—3P reliance and client autonomy/claim against lawyer

• Would it have mattered if the arbitration were less one-sided?

• Why not just let Ms. Blanton sue Harris?– What would she have to prove?– How would she have to prove it?

• How can you reconcile this case with 7108 West Grand Avenue?

Lally

• What happened?• What is the lawyer’s explanation?• Note how actual instructions even on tactical

matters affects the Court’s view of the case• Note (preliminarily—we’ll come back to this) the

number of arguments Kuster raises on damages

Olfe

• The court distinguishes between a failure to– Perform services in a way that meets the standard of

care applicable to such services (breach of the duty of care by incompetence); and failure to

– Carry out the (lawful) instructions of the principal (breach of the duty of care by disobedience)

• Cf Blanton on this issue

• Litigating the former may require expert testimony to establish the standard of care, so it can be shown the lawyer didn’t meet it

• Litigating the latter does not