Opinion 2002-4
(May 2002)

The inquirer advises that an attorney, who is himself the plaintiff adverse to the inquirer's client, a financial lender, has violated Pennsylvania Rule of Professional Conduct (the "Rule(s)") 7.3(b)(3) based upon the following conduct.   Before filing his Complaint, the plaintiff made several demands to settle his claim, all of which were rejected.  In a letter transmitting the Complaint, the plaintiff withdrew his earlier final offer to settle, and made several alternative increased demands, one of which was to have the defendant hire the plaintiff on a contingent fee basis to do a significant amount of collection work. The plaintiff further advised that unless one of the alternatives was accepted within a time specific, that his demand would be doubled.

The inquirer states that this demand violates Rule 7.3(b)(3) because it is a written communication to a prospective client for the purpose of obtaining professional employment; that the communication involves "coercion, duress or harassment" because unless the demand is accepted the suit will be pursued and plaintiff's demand will be doubled.  In addition, the inquirer believes the communication constitutes harassment because the amounts demanded bear no relationship to any reasonably conceivable liability or damage theory.

The inquirer asks the Committee if this conduct triggers his duty under Rule 8.3(a) to report the matter to the appropriate disciplinary authority.  In Pennsylvania this would be the Disciplinary Board of the Supreme Court of Pennsylvania. 

The Committee notes that the standard triggering an attorney's duty to report under that Rule is conduct which "raises a substantial question as to that lawyer's honesty, trustworthiness or fitness as a lawyer."  In addition, in any situation regarding reporting misconduct, the Committee points out that any such duty is tempered by the requirement of client consent under Rule 8.3c.

Turning to the specific conduct at hand, the Committee believes that the demands made, assuming that the inquirer is correct in stating they violate Rule 7.3b3, does not trigger the inquirer's duty to report the matter. The Pennsylvania Rules of Professional Conduct exist to regulate the conduct of attorneys as they relate to clients, and to protect the public from conduct by attorneys which violates those Rules. It would be a mistake to view the circumstances of the present inquiry in a vacuum.  The communications by plaintiff are qualitatively different then communications made by a disinterested attorney in his or her quest to obtain clients. The relationship between the plaintiff and the inquirer's client is adverse, and was adverse at the time the settlement demand was made. It is not appropriate to view the demand outside of that context.  Demands for settlement, reasonable or not, are made all the time in litigation, both prior to the start of litigation and during its course. The circumstances are that the inquirer's client was represented and had been for some time prior to the demand being made. The defendant's own attorney both reviewed it and advised on it before a decision was made to either accept or reject it.  The communication was an unreasonable settlement demand, and viewed in that context really falls outside any standard under the Rules that would require the inquirer to report the matter.

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.