The ethical issues raised by the events between Lawyer and Client are discussed below.

1. Attorney client relationship:

The issue is whether Client is the client of the attorney Lawyer.
To establish any violation of an attorney-client relationship, there must be an attorney client
relationship. This is established when a prospective client or client reasonably believes he is
represented by the attorney. Some duties survive even the death of the client, and termination
of thr representation.
Here, we are told that Lawyer accepted representation and client and lawyer entered a
contingency fee agreement. Therefore, Client is the client of Attorney.

2. Contingency fee agreement

The issue is whether the contingency fee agreement is valid under the ABA and California rules.

Under the ABA Model Rules, a contingency fee is permissible except for criminal cases, and family cases
such as divorce and determination of alimony. A contingency agreement should be in writing, and the
contingency fee should be reasonable. The client should acknowledge and sign the agreement

Here, the contingency fee agreement was in writing and duly signed. The contingency agreement was
for 1/3 of the recovery. If this is a reasonable fee, then the court will find the contingency fee agreement
valid under the ABA rules.

A contingency fee agreement in California must be in writing and the fee must not be unconscionable.
These requirements are likely met, as discussed above, and thus the agreement is valid under the
California Rules Professional Conduct.

3. Advance
The issue is whether the litigation expenses and living expenses advanced to the client are
permissible under applicable authority.

Validity of the advances made under ABA:

The ABA rules allow an attorney to advance court fees and related litaigation expenses such as
service fees, copying etc., (i) with a that the recovery is contingent on the recovery of the case
and (ii) for indigent clients. The ABA rules do not allow an attorney to advance money for other
reasons.

Here, the advance for money for litigation expenses was valid. However, the advancement of
$1000 as monthly rent was invalid.

Validity of the advances under CRPC:

The issue is whether the (i) ligitation expenses and the (ii) rent advanced to Client are valid
under the CRPC. The CRPC allows an attorney to advance litigation expenses and other
expenses.
 However, when the attorney advances money for other expenses, the rules relating to business
transactions apply. The transaction should not be unfavorable to the client. The attorney should
give the client the full terms in writing. The client should be advised and given the opportunity
to approach independent counsel to understand the agreement, and last, the client should
consent to the arrangement in writing.
Here, Lawyer orally agreed to advance litigation expenses. This is valid.
However, the oral agreement to advance living expenses at 1,000/- a month is a violation of the
CRPC because both the terms and consent are not reduced in writing and nothing on the record
shows that Client was given the advice and opportunity to consult with independent counsel.

Thus, the oral agreement to advance living expenses are in violation of both the ABA Rules and
the CRPC.

4. Agreement between Dr. and Lawyer, that Lawyer will pay Dr. from proceeds

The issue is whether the Lawyer could promise to pay the doctor from the proceeds, without the notice
or consent of the Client.

Under both ABA and CRPC, the attorney can only deduct the contingency fee and expenses, as clearly
outlined in the fee agreement, from the award.

ABA:

Under ABA rules, fee splitting is allowed only amongst lawyers themselves, and between lawyers, and
paralegal staff. The ABA also requires the split to be proportionate to the work done.

Here, it is unclear whether Lawyer will deduct medical expenses from his contingency fee or from the
total award. Both will be violations of the ABA.

If the lawyer deducts this from the award, it is impermissible, as the lawyer can only deduct his
contingency fee and legal expenses.

If the lawyer pays the physician with his contingency fee, he is engaging in fee splitting, which the ABA
prohibits between lawyers and non-lawyers.

Thus, the agreement between the lawyer and doctor amounts to an impermissible fee split.

CRPC:

The CRPC allows fee splitting only with lawyers, licensed referral services and the estate of a deceased
attorney. Further, the client should consent to the fee split in writing, and the resultant fee should not
increase. There is no proportionality requirement.

Here, Lawyer seeks to pay doctor from the award. If it is paid out of the contingency fee, it is an
impermissible fee split with a non-lawyer. Further, the fee split was made orally and without the
knowledge and consent of Client. Therefore the fee split is an ethical violation.

IF Lawyer argues that the payment was from the award, it is also an ethical violation for reasons
explained in the ABA section above.
 5. Sexual relations:

The issue is whether Lawyer and Client’s consensual sexual relationship after the settlement offer is an
ethical violation.

ABA:

ABA prohibits attorney-client sexual relations, and sexual relations with the legal representative of the
client in that case, unless the relations pre-existed the representation. For pre-existing representations,
the attorney should not represent the client if the relationship will prevent an effective representation.

Here, there was no pre-existing relationship. The attorney and client engaged in a sexual relationship
after discussing an offer to settle for their ongoing case, and sharing wine and a meal. Therefore, this is
in contravention with the ABA rule against sexual relationships.

CRPC:

The California Code does not prohibit sexual relations. However, the attorney cannot demand or require
sexual relations. Further, he cannot use undue influence, force or inducement to enter sexual relations.
Where the relations are consensual and not induced, the attorney should cease to represent the client if
it would cause the attorney to represent the client incompetently.

Here, we’re told that the relationship was consensual, and this would suggest an absence of coercion
and influence. However, the fact that Lawyer took Client out for an expensive meal, a lot of wine, and
then engaged in sex just before asking Client to accept settlement is likely to show that the consent was
engineered.

Further, Lawyer , after engaging in relations, asked Client to settle and client agreed. Before the wine
and sex, the client was reluctant to settle. This raises the question of effective representation. Lawyer
wanted Client to settle because he though it wouldn’t be worthwhile to drag the case. So when the
client was reluctant, he seduced Client and then elicited consent to settle.

This is likely to be viewed as incompetent representation. A lawyer should act competently in the best
interest of his client and not in conflict of this interest.

Financial conflict of interest is discussed below. By acting in conflict of client’s interest, i.e., preferring to
recover his expenses rather than see Client’s case through, Lawyer used sexual relations to act
incompetently. This is in likely violation of the CA rules. However, lawyer may argue that his legal
opinion was that the case was likely to drag on, and that a greater award would be unlikely, this may
weaken the argument of incompetence. Even so, it is likely that the sexual relationship will be found to
be in violation of the CA rules because it was used to elicit a settlement.

6. Settlement offer: (i) consent (ii) conflict (iii) settlement with attorney
(i) The issue is whether Lawyer validly convinced Client to accept settlement offer.
Both ABA and CA authorities require the attorney to communicate offers of settlement to the
Client, and let the client decide whether to settle or not.
An attorney cannot induce, coerce or require a client to settle or refuse to settle.
Here, Client was reluctant to settle. However, Lawyer wanted client to settle so lawyer would
recover his expenses. This is a conflict of interest (discussed below). Client was first reluctant,
but agreed to settle after an expensive dinner, two bottles of wine and sexual relations: all with
Lawyer. Lawyer therefore used unscrupulous methods on the client to accept the settlement,
and took the decision of whether to settle or not outside of the client’s hands. Therefore, the
ABA and CA rules are violated because the decision was effectively made by the lawyer.

(ii) The issue is whether the client’s reluctance and lawyers insistence on settlement
created a conflict
A conflict of interest is where the client’s interests and attorney’s interests diverge, and this may
impact effective representation. CA recognizes professional, financial and personal conflicts.
Broadly, conflicts may arise out of an attorney’s personal interests, or representation of a client.

Here, the client wished to continue to litigate but attorney wanted to settle to get his money
back. The attorney has a financial conflict of interest.

Here, the conflict arises from the advance of the litigation expenses and living expenses under
an oral agreement, and also the agreement between lawyer and doctor that the medical
expsnses will be paid form the award.

Both CA and ABA rules prohibit representation if it makes unduly difficult (CA) or materially
affects (ABA) the attorney’s ability to represent the client.

ABA:
The ABA rule of conflict of interest is that it should be disclosed, and the client should
acknowledge the conflict and consent to representation in writing after having the opportunity
to consult with another attorney.
Nothing in the facts suggest that Lawyer explained the conflicts involved. Further nothing
suggests that the client understood and consented to representation despite the conflict. This is
in violation of the ABA authority and CA rules.
Further, the conflict was heightened by the lawyer’s third party agreement with the physician,
which materially affected the extent of Client’s claim, as discussed above in the fee-splitting
section.

CA:
The CA rule requires written disclosure of the conflict. The Client should be advised and given an
opportunity to consult with another lawyer about the conflict. The client should also give a
written acknowledgment of the conflict and consent to the representation in writing.
 Further, the agreement relating to the conflicting subject matter was oral. There was no written
explaination of the potential conflict and no written acknowledgement received. In addition
nothing on record suggests that Client was advised to or given the opportunity to consult an
independent counsel. Instead, the facts suggest that an oral agreement was made face to face.
BY failing to disclose the conflict in writing, advise Client to seek independent counse, and
failure to obtain Client’s written consent to proceed with case are three counts on which Lawyer
likely committed ehitcal violation.

Further, by agreeing to pay the doctor from the client’s award, Lawyer decreased the amount
available to Client and thus acted in conflict of Client’s interest.

(iii) Although the settlement here is not a settlement of malpractice claims, it is a settlement
nonetheless, and the rules of settlement between an attorney and client are discussed
here.

Under both ABA and Ca rules, an attorney cannot force a client to settle with him. When the attorney
wishes to settle, he should provide the client the settlement terms and advice and the opportunity to
consult an independent counsel.

Here, the attorney believes that the case will drag along and he will not recover is expenses for a long
time. Therefore he requests the client to take the settlement offer from the Defendant Driver, and
agrees to settle the bill: instead of recovering expenses and a 1/3 contingent fee, the lawyer offers to
settle at $5,000/-,i.e., just revocering his expenses. Since this was not made in writing, and client did not
have the opportunity to consult independent counsel, it is a potential ethical violation.

Lawyer has a strong argument that the rules of settlement don’t apply, as they are limited to settlement
of malpractice claims. Therefore, the settlement between Lawyer and Client is unlikely to be an ethical
violation solely for the failure to reduce in writing.

7. Don’t pay physician:

The issue is whether the Lawyer’s statement: if you settle, then don’t pay physician--- is an ethical
violation.

First, the lawyer and physician agreed that the lawyer will pay the physician through the client’s award.
This is a conflict of interest discussed above.

Then the lawyer convinced client to settle, and promised that he would not have to pay physician out of
settlement proceeds. This was a tactic used to induce settlement and is an ethical violation as discussed
nin the “settlement” section above.

Third, if Lawyer intended intended to pay Physician out of pocket after settlement, this may be
interpreted as an impermissible fee split.
Last, if the Lawyer intended that the physician go unpaid, this is likely an ethical violation, because he is
inducing Client to leave the physician unpaid. This would be malpractice under ABA rules as Lawyer is
enabling or advising the client to perform a misconduct. Further, by inducing client to wilfuly not honor
contract, Lawyer’s actions are in moral turpitude. Therefore, by asking client not to pay physician,
lawyer has acted in misconduct under both CA and ABA rules.