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Duty of Care Owed to Foreseeable Plaintiff
A duty of care arises when the defendant engages in the affirmative conduct associated with being a commercial supplier of products. This duty is owed to all foreseeable plaintiffs; there is no
requirement of contractual privity between the plaintiff and defendant. Hence, the duty extends
to users, consumers, and bystanders. Here, Mfr. produced the allergy pills and is therefore a commercial supplier. Sally was a foreseeable plaintiff because the pills were prescribed to her for treatment of her allergies. Hence, Mfr. owed Sally a duty of reasonable care in supplying the pills.
Breach
To prove breach of duty, the plaintiff must show (i) negligent conduct by the defendant that leads to (ii) the supplying of a defective product by the defendant. To establish that a manufacturer’s negligence resulted in a design defect or inadequate warnings, the plaintiff must show that the manufacturer knew or should have known of enough facts to put a reasonable manufacturer on notice of the dangers of marketing the product as is.
Here, Mfr. knew that there was a remote risk of permanent loss of eyesight associated with use of the pills, but advertised the pills as a “safe” means of controlling allergy symptoms without any warnings of the risks. Mfr. may argue that its product was sold only by medical prescription, so that a consumer likely would be warned by the prescribing physician. However, the facts here show that these warnings are not always provided. While the risk of harm was small, the gravity of the harm was substantial. Balanced against that is the relatively low expense of providing a warning label on the bottle so that consumers would be alerted to the risk. Accordingly, a trier of fact could find that Mfr. was negligent in not supplying warnings of the risk to users of the pills. Sally also must show that the pills were a defective product, as discussed above. If Mfr. supplied warnings of the risk to physicians, Sally will have to overcome the learned intermediary rule to establish that the absence of warnings to patients made the pills defective.
Actual Cause, Proximate Cause, and Damages
The elements of actual cause, proximate cause, and damages are analyzed the same as under the strict liability theory. Under standard proximate cause rules, a defendant is liable for all harmful results that are the normal incidents of, and within the increased risk caused by, his negligence.
In an indirect cause case, an intervening force comes into motion after the defendant’s negligent conduct and combines with it to cause the plaintiff’s injury. If the defendant’s actions created a foreseeable risk that this intervening force would harm the plaintiff, the defendant is liable for the harm caused. Here, Doc neglected to warn Sally of the risks of the pills. This conduct combined with Mfr.’s failure to include warnings on the product itself to cause Sally’s injury, because Sally would not have taken the pills had either defendant warned her about the risks. Hence, Doc’s conduct does not cut off Mfr.’s liability for its negligence. As discussed above, the extent of Sally’s recovery will likely be limited by her failure to mitigate damages by undergoing the corneal transplant.
Defenses
In a products liability action based on negligence, the standard negligence defenses are appli- cable. Under these rules, a plaintiff whose negligence was found to have contributed to her injury was completely barred at common law from recovering under traditional contributory negligence rules. Similarly, a plaintiff who knowingly and voluntarily assumed the risk of injury from the defendant’s conduct, whether expressly or impliedly, was barred from recovering damages. Most states today have replaced the traditional contributory negligence and implied assumption of risk rules with a comparative negligence system, in which the trier of fact weighs the plaintiff’s negli- gence against that of the defendant and reduces the plaintiff’s damages accordingly. Here, Sally was not negligent and assumed no risks in taking the pills because she had not been informed of the risks. Thus, no defenses can be raised by Mfr.
লেখাটিতে শুধু একটি বিষয় পর্যালোচনা করা হচ্ছে। অর্থনৈতিক শক্তি হিসেবে আবির্ভাবের সঙ্গে বাংলা ভাষার প্রসার ও এই ভাষায় দক্ষতা উন্নয়নের কোনো বিরোধ রয়েছে? উপার্জন কাজের জন্য বাংলা দক্ষতা কতটা জরুরি বা সহায়ক? সেখানে কোনো সমস্যা থাকলে সেগুলো কীভাবে সমাধান করা যায়? নাকি ধীরে ধীরে আমাদের প্রাণের ভাষা পেছনে পড়ে থাকবে অচল হয়ে, শুধু কিছু সাহিত্যের ছাত্র-শিক্ষক-লেখকদের মধ্যে সীমিত হয়ে?
লেখাটিতে শুধু একটি বিষয় পর্যালোচনা করা হচ্ছে। অর্থনৈতিক শক্তি হিসেবে আবির্ভাবের সঙ্গে বাংলা ভাষার প্রসার ও এই ভাষায় দক্ষতা উন্নয়নের কোনো বিরোধ রয়েছে? উপার্জন কাজের জন্য বাংলা দক্ষতা কতটা জরুরি বা সহায়ক? সেখানে কোনো সমস্যা থাকলে সেগুলো কীভাবে সমাধান করা যায়? নাকি ধীরে ধীরে আমাদের প্রাণের ভাষা পেছনে পড়ে থাকবে অচল হয়ে, শুধু কিছু সাহিত্যের ছাত্র-শিক্ষক-লেখকদের মধ্যে সীমিত হয়ে?
লেখাটিতে শুধু একটি বিষয় পর্যালোচনা করা হচ্ছে। অর্থনৈতিক শক্তি হিসেবে আবির্ভাবের সঙ্গে বাংলা ভাষার প্রসার ও এই ভাষায় দক্ষতা উন্নয়নের কোনো বিরোধ রয়েছে? উপার্জন কাজের জন্য বাংলা দক্ষতা কতটা জরুরি বা সহায়ক? সেখানে কোনো সমস্যা থাকলে সেগুলো কীভাবে সমাধান করা যায়? নাকি ধীরে ধীরে আমাদের প্রাণের ভাষা পেছনে পড়ে থাকবে অচল হয়ে, শুধু কিছু সাহিত্যের ছাত্র-শিক্ষক-লেখকদের মধ্যে সীমিত হয়ে?
at the time the product was placed into the stream of commerce. Here, Mfr. could have foreseen Sally’s loss of eyesight because it was aware of that risk from the pills. The fact that the risk was remote does not make it unforeseeable.
Mfr. may contend that Doc’s failure to warn Sally of the risk was a superseding force that cuts off any liability on its part. However, ordinary negligence on the part of an intermediary does not cut off the manufacturer’s strict liability. Here, while Doc was negligent in failing to warn Sally of the risk (as discussed below), this negligence likely would be considered foreseeable and therefore not a superseding force that breaks the chain of causation.
Damages
For the final element of the prima facie case, the plaintiff must show that the defendant’s defective product caused injury to her person or property. Here, Sally suffered a substantial loss of eyesight as a result of taking the pills, so the damages element is established.
Mfr. will attempt to limit its liability by contending that Sally failed to mitigate her damages. In all cases, a plaintiff has a duty to take reasonable steps to mitigate damages. In personal injury cases, this requires the plaintiff to seek appropriate treatment to effect a cure or healing and to prevent aggravation. The failure to mitigate precludes recovery of any additional damages caused by aggravation of the injury. Mfr. will argue that Sally acted unreasonably by refusing to undergo surgery that probably would have restored excellent eyesight to one of her eyes with minimal
risk to her, especially because expenses for the procedure would have been paid by her insurance company. Sally will argue that her duty to mitigate does not extend to consenting to surgery on her eye that she was fearful of undergoing. Whether Sally acted reasonably will ultimately be determined by the trier of fact. On balance, it is likely that Sally will be found not to have acted reasonably, given the low risk, the likelihood of success, and the full coverage by insurance. Hence, Mfr. will be liable for damages for Sally’s loss of eyesight in one eye but not for the total loss of eyesight in both eyes.
Defenses
In a products liability action based on strict liability, the traditional rule is that ordinary contribu- tory negligence is not a defense to a strict liability action. Hence, it is no defense that the plain- tiff failed to discover the defect or guard against its existence, or that the plaintiff engaged in a reasonably foreseeable misuse of the product. On the other hand, other types of unreasonable conduct, such as voluntarily and unreasonably encountering a known risk (i.e., assumption of risk), can be raised as a defense. Modernly, many comparative negligence jurisdictions apply their comparative negligence rules to strict products liability actions, thereby reducing a plaintiff’s recovery based on her comparative fault. Here, Mfr. can raise no defenses against Sally because she was not at fault in taking the pills. Thus, while Sally’s recovery may be reduced by her failure to mitigate (discussed above), it will not be reduced by any fault-based defenses.
NEGLIGENCE THEORY
To establish a prima facie case for a products liability action based on negligence, the plaintiff must show (i) a duty owed by the defendant to the plaintiff, (ii) breach of that duty, (iii) actual and proximate cause, and (iv) damages.
La Argentina es un Estado federal, que comprende al Estado Nacional, coexistiendo con Estados provinciales autónomos, lo que determina que exista un Derecho Constitucional Nacional y tantos Derechos Constitucionales Provinciales como provincias haya. El Derecho Constitucional, es el ordenamiento jurídico fundamental y supremo, que organiza jurídica y políticamente al Estado. Determina la forma del Estado y su gobierno, competencias y atribuciones, fines estatales, derechos y garantías de los habitantes. Regula la organización de todo el derecho, sentando principios básicos y determinando la forma de gobierno y la forma de Estado. También determinando las relaciones entre particulares y el Estado y las obligaciones que de ellas se desprenden. El Derecho Constitucional enfoca, en primer término, en la Parte Dogmática, los principios y declaraciones constitucionales, así como el tema de los derechos fundamentales del individuo, que tienen por fin su fortalecimiento como base del carácter instrumental del Estado.
Sally’s products liability suit against Mfr. may be based on strict liability, negligence, breach of implied warranty of merchantability, and representation theories (express warranty and misrepre- sentation).
STRICT PRODUCTS LIABILITY THEORY
A commercial supplier may be strictly liable in tort for injuries caused by a defective product. To prevail, the plaintiff must establish the following elements: (i) the defendant is a commercial supplier; (ii) the defendant produced or sold a product that was defective when it left the defen- dant’s control; (iii) the defective product was the actual and proximate cause of the plaintiff’s injury; and (iv) the plaintiff suffered damages to person or property.
Commercial Supplier
Strict liability applies to commercial suppliers who place products in the stream of commerce; it does not apply to casual sellers. Commercial suppliers include manufacturers, wholesalers, assem- blers, and retailers. Here, Mfr. is a commercial supplier of the allergy pills.
Production or Sale of Product that Was Defective When It Left Defendant’s Control
The plaintiff must prove that the defendant supplied a product that was defective when it left the defendant’s control, but need not prove that the defendant was negligent. Types of defects include manufacturing defects, design defects, and information defects. Inadequate warnings are informa- tion defects. In a design defect case, all of the products of a line are made identically according
to manufacturing specifications but are in a defective condition unreasonably dangerous to users because of their components or packaging. As to warnings, a product may be defective if it does not have clear and complete warnings of any dangers that may not be apparent to users. Under the “learned intermediary” rule, however, warnings regarding prescription drugs need not be supplied to the patient; a warning to the prescribing physician usually will suffice.
Here, Mfr. was aware of a remote risk of permanent loss of eyesight associated with use of the pills, but did not issue any warnings with them. Sally was not aware of the risk and had no reason to know of any danger in taking the pills. Even a “remote” risk of something as serious as perma- nent loss of eyesight is a danger of which a user would want to be informed. Mfr. will argue that it did not need to warn Sally because the “learned intermediary” rule applies and Doc (her doctor) was aware of the risk. However, it is not clear from the facts whether Doc was warned by Mfr.
or whether he learned of the danger independently. Furthermore, because Mfr. was advertising the pills directly to consumers, Sally will argue that the advertising also should have included warnings about serious risks, and including such warnings would not have unduly burdened Mfr.
Actual Cause
To prove actual cause, the plaintiff must trace the harm suffered to a defect in the product that existed when the product left the defendant’s control. If the plaintiff claims that one of the defec- tive conditions was the lack of an adequate warning, she can rely on a presumption that an adequate warning would have been read and heeded. Here, the facts state that, if Sally had been warned about the risks from the pills, she would not have taken them and consequently would not have lost her eyesight. Thus, actual cause is established.
Equitable Lien
As noted above, equitable remedies, including equitable liens, are cut off by the transfer of the property to a BFP. Here, Jones is a BFP because he paid fair market value for the car, and the facts do not indicate that he knew the car had been previously stolen or that money was owed to CARS. Therefore, CARS may not impose an equitable lien on the car.
Constructive Trust
Similarly, constructive trusts are cut off by the transfer of the property to a BFP. Since Jones is a BFP, CARS may not impose a constructive trust on the car.
Contract Damages
As noted above, a plaintiff may recover damages from the defendant to be put in as good a position as if the contract had been performed. Here, Jones never entered into a contract with CARS, and as such, CARS cannot recover contract damages from Jones.
Tort Damages
As discussed above, a plaintiff may recover damages to compensate it for loss or injury. Tort damages are not available because Jones did not inflict any injury on CARS. He acquired legal title to the car after the injury had already been inflicted. Consequently, CARS cannot recover any tort damages from Jones.
pay CARS’s full claim (potentially $5,000) and the legal remedy is inadequate. Where the defen- dant commingles his funds and those belonging to the plaintiff in one account, and then causes the balance in the account to sink below the amount of the plaintiff’s claim, the plaintiff may obtain an equitable lien only to the extent of the lowest intermediate balance of the account.
After Brown deposited the $8,000 he received from Jones into his account, his account totaled $22,000. He later withdrew $20,000, leaving only $2,000 in the account. The $1,000 that Brown won in the lottery the next day is irrelevant because the lowest intermediate balance is $2,000. Therefore, CARS may impose an equitable lien on $2,000. CARS can seek a deficiency judgment for the remainder of the money owed.
Constructive Trust
Like an equitable lien, a constructive trust is imposed when retention of property results in unjust enrichment. The property is held in trust by the defendant for the plaintiff, with the defendant’s sole obligation being to convey the property to the defendant. The plaintiff can also use tracing to impose a constructive trust on proceeds of wrongfully acquired property. Again, the plaintiff must show that the legal remedy is inadequate. However, unlike an equitable lien, an action for a deficiency is not allowed after imposition of a constructive trust.
As discussed above, Brown would be unjustly enriched if he is not required to pay CARS for the value it added to his car as a result of its repairs, and the legal remedy is inadequate. However, CARS cannot impose a constructive trust on the car because Brown sold it and transferred legal title to Jones. CARS would not want to place a constructive trust on the funds Brown received from the sale of the car because it would not be able to obtain a deficiency judgment for the remainder of the money owed. Therefore, between an equitable lien and a constructive trust, the equitable lien is the better remedy in this situation.
Contract Damages
In contract cases, a plaintiff may recover damages in order to be put in as good a position as if the defendant had performed the contract. Here, Brown never entered into any agreement with CARS. Therefore, CARS may not recover any contract damages from Brown.
Tort Damages
In tort cases, a plaintiff may recover damages where it has suffered a loss or injury. Tort damages are intended to compensate the plaintiff for its loss. Like contract damages above, tort damages are not available because Brown did not inflict any injury on CARS. Consequently, CARS cannot recover any tort damages from Brown.
2. CARS’ REMEDIES AGAINST JONES
Quasi-contract
As noted above, where a defendant has been unjustly enriched by the actions of the plaintiff, the court will impose a quasi-contract on the defendant and force him to pay restitution to the plain- tiff. In this case, Jones paid fair value for the car. As such, he has not been unjustly enriched, and a quasi-contract may not be imposed.
Replevin
Through the legal restitutionary remedy of replevin, a plaintiff can recover specific personal property wrongfully taken or detained. Here, Jones did not wrongfully take or detain the vehicle. Instead, he purchased the vehicle from Brown, who conveyed his legal title to Jones. As such, Jones is the rightful owner. CARS may not replevy the car from Jones.
1.
Restitution
A restitutionary remedy is imposed in situations where the defendant has been unjustly enriched by the actions of the plaintiff. This is sometimes called an action in quasi-contract. Quasi- contracts are not contracts at all; they are obligations created by law for reasons of justice. To recover under quasi-contract, the plaintiff must prove: (i) it conferred a benefit on the defendant by rendering services; (ii) it conferred the benefit with the reasonable expectation of being compen- sated for its value; (iii) the defendant knew or had reason to know of the plaintiff’s expectation; and (iv) the defendant would be unjustly enriched if he were allowed to retain the benefit without compensating the plaintiff. Where the plaintiff renders goods or services, it may recover the value of the goods and services or, if tangible property has been transferred to the defendant, it may replevy the property. Transfer of the property to a bona fide purchaser (“BFP”—i.e., one who takes for value and without knowledge of the wrong) cuts off the right to equitable remedies such as replevin.
In this case, there was no agreement between CARS and Brown because Brown never requested the repairs. However, CARS reasonably expected to be compensated for the value of its services. Although Brown originally had no reason to know of CARS’s expectation of compensation, CARS probably can recover based on quasi-contract because it conferred a benefit on Brown such that he was able to sell his car to Jones for more money than if the car had not been repaired. CARS may not replevy the car itself; this remedy is cut off because Brown transferred legal title to Jones, who is a BFP because he purchased the car for $8,000 and nothing indicates that he knew the car was stolen. Nevertheless, CARS may recover monetarily. The court could award CARS the fair value of the work done and parts and materials supplied, which, in this case, is $5,000. Alternatively, the court could award CARS the value of the benefit; i.e., the difference between the pre-repair value of the car and the value that resulted from the repairs. Presumably, the value of the benefit was less than $8,000, but the exact amount of the remedy based on this measure cannot be determined because the car’s pre-repair value is unknown. If the value of the benefit conferred is less than the value of the work and materials provided, a court may be more apt to award CARS the value of the benefit conferred because although Brown did not seek out CARS’s services, he was able to receive more money for the car in its repaired condition.
Equitable Lien
An equitable lien is imposed when the retention of property (or its proceeds) by a defendant would result in unjust enrichment. To impose an equitable lien, the plaintiff must show that (i) the defendant misappropriated the plaintiff’s property under circumstances creating a debt or an obligation to pay, (ii) the plaintiff’s property can be traced to property held by the defendant, (iii) the defendant’s retention of the plaintiff’s property would result in unjust enrichment, and (iv) the legal remedy is inadequate. An equitable lien is appropriate where the property has decreased in value because the plaintiff can impose a lien on the property for whatever value it has and then seek to recover any deficiency from the defendant.
As discussed above, Brown is obligated to pay CARS at least the value added to his car as a result of the repairs, or he will be unjustly enriched. Furthermore, the proceeds from the sale of the
car to Jones can be traced to Brown’s bank account. The problem, however, is that Brown subse- quently gambled away most of the money in his account. Now he is insolvent, meaning he cannot
Operation of a “Gift and Greeting-Card Store”
However, assuming that a court found that the noncompetition covenant ran with the land from Tony to Ann, the facts still do not support a finding that Lori was in breach. In February, a drugstore added a small rack of greeting cards to its shop. This likely does not rise to the level of operating a “gift and greeting‐card store.” Thus, Ann probably would not be able to establish that Lori actually breached her covenant here.
Ann’s Remedies
Nonetheless, even if Ann showed that the small rack of greeting cards resulted in significant financial losses to her business and the court found Lori in violation of the covenant, this would not allow Ann to stay on the property without paying the agreed‐upon rent. Rather, Ann could sue Lori for breach of the covenant or, if the breach was considered material, Ann could terminate the lease. However, staying on the premises without paying rent is not an available remedy. Thus, Lori was entitled to terminate her tenancy and may refuse to renew the lease.
2. LORI’S ENTITLEMENT TO PAST-DUE RENT
Recovery from Ann
As explained above, Ann was not entitled to remain on the premises without paying rent. Because the covenant to pay rent runs with the land, an assignee owes the rent directly to the landlord. She does not owe rent for the period before the assignment, but only for the time that she is in privity of estate. Thus, Lori may sue Ann to collect the rent owed for the months that Ann remained on the premises and refused to pay. Furthermore, in some states, a commercial landlord who does not receive rent when due can assert a lien on the personal property found on the leased premises.
Recovery from Tony
After assignment, the original tenant is no longer in privity of estate with the landlord. But a
lease is a contract, and the original tenant and the landlord remain in privity of contract after
the assignment. The original tenant can still be held liable on his original contractual obligation to pay rent. If a tenant’s assignee fails to pay rent, the landlord can sue the assignee because of privity of estate and can also sue the original tenant because of privity of contract. Thus, if Lori is unable to collect the past‐due rent from Ann, she may sue Tony for the amount that Ann did not pay.
1.
The five‐year lease between Lori and Tony contained a term granting the tenant the right to renew the lease for five years on the same terms. Whether Ann is entitled to renew the lease depends first on whether this renewal term ran with the land when Tony transferred his interest to her.
Tony’s Transfer to Ann
Absent an express restriction in the lease, a tenant may freely transfer his leasehold interest in whole or in part. If he makes a complete transfer of the entire remaining term, he has made an assignment. If he retains any part of the remaining term, the transfer is a sublease. An assignee stands in the shoes of the original tenant in a direct relationship with the landlord. The assignee and the landlord are in privity of estate, and each is liable to the other on all covenants in the lease that run with the land. Here, Tony transferred his interest in the lease to Ann. This constitutes an assignment.
When a Covenant Runs with the Land
A covenant runs if the original parties to the lease so intend and if the covenant touches and concerns the leased land, meaning it benefits the landlord and burdens the tenant, or vice versa, with respect to their interests in the property. Covenants that run with the land include covenants to pay money, such as rent or taxes. Whether the original covenanting parties intended that successors in interest be bound by the terms of the covenant may be evidenced by language in
the conveyance creating the covenant. This lease stated that “Landlord and Tenant agree for themselves and their successors and assigns,” which shows that the original parties intended the covenants to run with the land. Furthermore, the covenant touches and concerns the land because it relates to the continuation of the landlord‐tenant relationship on that property. Thus, the renewal term ran with the land when Tony assigned his lease to Ann.
Ann notified Lori in writing during the final year of the five‐year lease that she wished to renew the lease according to its terms. Because the covenant ran with the land, Ann was entitled to renew unless her failure to pay the percentage rent disqualified her from enforcing the covenant.
Ann’s Failure to Pay Revenue-Percentage Rent
At common law, covenants in a lease were independent of each other, meaning that one party’s performance of her promise did not depend on the other party’s performance of his. Thus,
if one party breached a covenant, the other could recover damages but still had to perform
her promises—such as to pay rent—and could not terminate the landlord‐tenant relationship. However, modern courts are likely to construe covenants as dependent when the other party’s breach relates to a material part of the lease, excusing one party’s performance after proper notice and time to cure. Similarly, in nearly all states a landlord may terminate the lease if the tenant breaches his covenant to pay rent. Here, the lease called for a monthly fixed rent of $500, plus a percentage of the gross revenue from the store. Ann ceased to pay the percentage rent from March 2003 on. Accordingly, Lori was not required to renew the lease on Ann’s request.
Lori’s Allowance of the Drug Store Competition
Ann may counter that, by the same argument, she was excused from paying rent because Lori breached her noncompetition covenant. The original lease contains a covenant that the landlord would not allow any other gift or greeting‐card store in the center. Covenants not to compete have created several problems in terms of determining whether they run with the land. The burden
of the covenant—restricting the use to which the land may be put—touches and concerns the land. However, the benefited land, while commercially enhanced, is not affected in its physical use. Thus, some courts have refused to permit the benefit of such covenants to run with the land. Nonetheless, a court would likely find that the entirety of this covenant—restricting tenant’s permissible uses of the land to a gift and greeting‐card store as well as preventing the landlord from allowing competition—touched and concerned the land.
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Here, Association approached Lawyer and asked her to represent them in a matter that would involve similar issues as her representation of Developer. Both Association and Developer are challenging the wetlands provision of the land use ordinance, and Association’s suit may actually pressure City into reaching a compromise regarding Developer’s project. However, the interests of Association and Devel- oper are not completely aligned. Association is challenging the general validity of the provision, while
Developer is challenging it only as applied to its own project. Thus, there is a significant risk that the two clients’ interests may become adverse at some point. For example, if City wants to grant a special use exception or a variance to Developer to eliminate his suit and leave the ordinance intact, then Developer and Association’s interests would be materially adverse.
Another possibility is that Lawyer could discover confidential information while representing Associa- tion that could be relevant to Developer’s case, and vice versa. Because a lawyer has a duty to act in her client’s best interest, Lawyer’s inability to use confidential information to the other client’s benefit could hinder the representation.
Because there is a significant risk that Lawyer’s representation of one client will be materially limited by her duties to the other, a conflict of interest exists. If Lawyer reasonably believes that she can repre- sent both clients despite the conflict, she needs to fully explain all of the risks of the simultaneous representation to both clients and obtain the required informed consent.
Accepting Compensation from Third Parties
Under the ABA Rules, a lawyer must not accept compensation for representing a client from someone other than the client unless: (i) the client gives informed consent; (ii) there is no interference with the lawyer’s independence of professional judgment or with the lawyer-client relationship; and (iii) infor- mation relating to the representation of a client remains confidential. California further requires that the client’s informed consent be in writing.
Here, Developer has offered to pay half of Association’s legal fees. There is a possibility that Devel- oper may attempt to direct the course of Lawyer’s representation of Association in order to protect his own interests. Furthermore, as discussed above, Lawyer would have to be very careful to make sure all information relating to her representation of Association remained confidential. If Lawyer explained these issues to Association and obtained its informed consent, Lawyer could accept payment from Developer for Association’s legal fees.
The facts indicate that Lawyer performed legal research to ascertain the validity of a land use ordinance that has since been enacted. The information gained during the research probably is considered “generally known,” because it can most likely be found in legal books or databases that are avail- able to the public. The facts do not specify whether Lawyer obtained any other confidential information that might be relevant to Developer’s lawsuit (or Association’s lawsuit—see below). If so, then Lawyer may not be able to continue representing Developer without violating her continuing duty to City.
W & Z’S REPRESENTATION OF DEVELOPER
Imputation of Conflicts
If a conflict of interest does exist with respect to Lawyer’s representation of Developer and Lawyer is disqualified, the firm will have to take steps to make sure that the matter can be assigned to a different lawyer within the firm.
If a former government lawyer is disqualified from a matter for the reasons described above, other lawyers in the firm for which the disqualified lawyer now works may handle the matter if all of the following conditions are met: (i) the disqualified lawyer is screened from any participation in the matter (e.g., the disqualified lawyer must not talk about the matter with the lawyers who are handling it and must not have access to files about the matter); (ii) the disqualified lawyer does not share any part of the fee earned in the matter (other than his normal salary or partnership share); and (iii) the appro- priate government agency is promptly notified of the screening arrangement so the agency can make sure that the screening is adequate.
Thus, if Lawyer is disqualified from representing Developer based on her past work for City, W & Z must satisfy the above conditions before continuing representation of Developer. Given that W & Z has already assigned the matter to Lawyer rather than screening her from the matter, it does not seem that the firm has properly handled the situation.
LAWYER’S REPRESENTATION OF ASSOCIATION
Conflict of Interest with Current Clients
Lawyer’s duty of loyalty to her clients may be implicated if she simultaneously represents Developer and Association in their respective lawsuits. A lawyer is not prohibited from taking inconsistent legal positions in separate representations. However, a lawyer generally must not represent a client when there is a significant risk that the representation will be materially limited by the interests of another client.
Under the ABA Rules, a lawyer may still undertake the representation if: (i) the lawyer reasonably believes that she can competently and diligently represent each affected client despite the conflict; (ii) the representation is not prohibited by law; (iii) the representation does not involve asserting a claim by one client against another client represented by the lawyer in the same proceeding; and (iv) each affected client gives informed consent, confirmed in writing. The California Rule is the same, except that it requires “informed written consent” (that is, both the lawyer’s disclosure of the conflict and the client’s consent must be in writing).
