Opinion 2000-8
(September 2000)

The inquirer is a lawyer who does independent contracting work for a law firm. He is retained only to try cases for clients.  The law firm does not permit inquirer to discuss settlement with clients.  The inquirer asks whether he has a duty to convey a settlement offer to a client if he believes that the offer may not have been conveyed to the client by the law firm.  In particular, the inquirer asks what are his ethical duties to disclose a settlement offer to a client in the following situations:

1. In an arbitration matter where he has not entered his appearance and has no fee or other agreement with the client, and
2. In a jury trial matter where he has entered an appearance but again has no agreement with the client.

More generally, the inquirer asks what duties he has towards the client -- is he obligated to do as the law firm says he should do, no more and no less?

It is the opinion of the Committee that the inquirer has a duty to his client even though he has been retained by the law firm.  In other words, the fact that the inquirer was retained by the law firm does not mean that his duty towards the client is any different than that of the law firm to the client.  This is consistent with Rule 5.2, which states that "[a] lawyer is bound by the rules of professional conduct even when the lawyer acts at the direction of another person."  Thus, whether a lawyer is acting at the direction of a more senior attorney at his firm or at the direction of an attorney at another firm, the lawyer always has duties to the client under the Pennsylvania Rules of Professional Conduct.  The inquirer's duty to the client does not depend on whether he or she has entered an appearance or has a fee or other agreement with the client.  So long as the inquirer is acting as an attorney on behalf of the client, the inquirer has ethical duties to that client under the Rules of Professional Conduct.

Among the inquirer's duties to his client is the duty to "keep the client informed about the status of a matter --"  See Rule 1.4 of the Rules of Professional Conduct.  The Comment to Rule 1.4 states that "[a] lawyer who received from opposing counsel an offer of settlement in a civil controversy . . . should promptly inform the client of its substance unless prior discussions with the client have left it clear that the proposal will be unacceptable."  See also Rule 1.2(a) ("A lawyer shall abide by a client's decision whether to accept an offer of settlement of a matter.").  The inquirer, therefore, has a duty to disclose any and all settlement offers to the client unless he or she knows that the settlement offer will be unacceptable.  See Opinion 94-25 ("The Committee's position is that Rule 1.4 and 1.2 require that the offer of settlement be communicated to the client.").  The inquirer states that in a particular matter which prompted the inquiry, he believes that the settlement offer was not conveyed by the law firm to the client.  Unless the inquirer is reasonably certain that the law firm disclosed the settlement offer to the client or that the client has previously authorized the law firm to turn down such a settlement offer, the inquirer has a duty to disclose that offer directly to the client.

In examining whether the inquirer has a "reasonable certainty" that the law firm has been expressly authorized to turn down a specific (or any and all) settlement offer(s), the Committee notes that in the present inquiry, where the inquirer is not a member of the firm, due diligence in coming to that conclusion would include some form of direct communication with the client, at least once, on the issue of authority to accept or decline a specific settlement offer, or settlement offers in general
The Philadelphia Bar Association's Professional Guidance Committee provides, upon request, advice for lawyers facing or anticipating facing ethical dilemmas. Advice is based on the consideration of the facts of the particular inquirer's situation and the Rules of Professional Conduct as promulgated by the Supreme Court of Pennsylvania. The Committee's opinions are advisory only and are based upon the facts set forth. The opinions are not binding upon the Disciplinary Board of the Supreme Court of Pennsylvania or any other Court. They carry only such weight as an appropriate reviewing authority may choose to give it.