Ethics Spotlight: How to Avoid Ethical Pitfalls in Co-Lawyering a Case

September 2021

By Karen M. Goodman

Civil trial lawyers are approached frequently by other lawyers about associating in on cases that are about to be tried. Typically, the lawyer soliciting assistance either needs the trial lawyer’s courtroom knowledge or support staff capacity. Co-lawyering on cases can provide benefits for the clients and the lawyers by combining the lawyers’ expertise to achieve a common goal—a good result for the client. However, co-lawyering on cases has several ethical pitfalls to consider, including issues concerning the allocation of responsibility of each lawyer vis-à-vis the client and how these allocated duties should be reflected in the agreement between the lawyers on the one hand and the fee agreement with the client (or clients) on the other. In addition, to avoid possible confusion and misunderstandings, the lawyers must set clear lines of communication among themselves and the client. Finally, there are other concerns regarding how the client’s money and property are handled, as well as how any fee is to be distributed. Each of these issues will be addressed.

1. Critically evaluate the case before agreeing to come on board. 

A good case has an appealing client, good facts, and supporting law. Most likely, the soliciting lawyer will rave about the strengths of the case and minimize the problems. There is usually a reason the lawyer who has been handling the case for some time decides to bring in another lawyer. It is important to recognize that once you decide to come on board, you will personally assume ethical obligations to the client. You will be expected to competently perform the agreed legal services. (CRPC 1.1). You will be expected to be diligent in the work you undertake. (CRPC 1.3). You will also share with your co-counsel the duties of fully communicating significant developments in the case to your client. (CRPC 1.4(a)). 

But many cases are only “good” in the minds of clients (or in the mind of the lawyer seeking assistance). We all have spent many hours on cases that have significant holes in them, holes that cannot be plugged by even the most skillful trial lawyer. In co-lawyering a case, do not assume that the soliciting lawyer has scrutinized the case as carefully as you would. You need to be just as vigilant about co-lawyering a case as you would if the potential client contacted you before the lawsuit was filed. A weak case will not get better because of your skills—don’t fool yourself and be wary of colleagues who praise your trial skills. With the soliciting lawyer’s permission (see CRPC 4.2), make sure that you directly communicate with the prospective client before agreeing to come on board. With the fiduciary duties that you assume once you sign on, the maxim “know your client, know your case” is imperative. You will have the obligation to provide your new client with your honest assessment of the situation—even if the advice is unpleasant or contrary to what your “co-venturing” lawyer has told the client. (CRPC 2.1; see also ABA Rule 2.1, Comment [1] (“Legal advice often involves unpleasant facts and alternatives that a client may be disinclined to confront.”)). 

2. The allocation of duties and value: Ensure the existing fee agreement complies with the law and structure any new agreement between you and the soliciting lawyer to realistically reflect the skills you and that lawyer are bringing to the table.

You should use your fee agreement with the soliciting lawyer to define the scope of representation as well as the relationship between the originating attorney, your client, and you. Treat a co-counsel relationship with the originating lawyer like any other partnership—memorialize the expectations of all the parties in advance. 

Before signing on as “co-counsel,” obtain a copy of the existing fee agreement from the soliciting lawyer. The absence of a written fee agreement should be a red flag. First, confirm the existing fee agreement complies with the requirements of Business and Professions Code section 6147. Second, make sure the existing fee structure is something that you can live with. As an example, there is a great disparity amongst the plaintiffs’ bar concerning the calculation of the lawyer’s percentage of recovery as a fee as it relates to costs. There also is a lot of variation amongst lawyers as to how costs are handled. 

Establish a clear understanding of who is expected to bear litigation costs. As anyone who has tried cases knows, litigation costs are increasing dramatically. Just look at the bill from your favorite court reporter for a remote deposition. If you are expected to bear a portion (or all) of the costs, make sure that you understand what that is likely to mean in this case. 

The division of fees between the lawyers needs to reflect the respective skills the lawyers are bringing to the table. It is not necessarily a function of just lawyer time. For instance, if you are expected to provide staff support for a lengthy trial, the amount of staff time required needs to be factored into the division of any fees. The established relationship between soliciting lawyer and client is certainly valuable, but because so much effort necessarily goes into obtaining a successful verdict, the relative skills and productivity of the respective lawyers need to be considered as well.  A lawyer who possesses superior trial skills brings great value to the case that will be tried. You need to factor that added value into any attorneys’ fees split since those skills can make a difference in a case. 

In summary, the allocation of fees between lawyers should be supported in the agreement. Make sure the respective responsibilities of the lawyers are spelled out: Who is responsible for advancing vendor’s costs? Who is responsible for communications with the client? Who is responsible for putting together the court filings? Obviously, an assessment of the relative strengths of each of the lawyers and staff members should be done at the outset of the co-lawyering arrangement, as well as a comparison of each other’s schedules and any pressing deadlines in the case.

3. Disclosure and client consent: Secure the client’s agreement in writing.

Fundamental to any co-lawyering relationship is complying with the Rules of Professional Conduct. Fee sharing amongst lawyers in different law firms is permitted provided the ethical rules are followed. All co-lawyering cases require a written agreement between the lawyers to divide the fee (see section 2, above) together with disclosures to the client detailing the arrangement followed by the client’s consent in writing to the disclosed terms of the fee division. (CRPC 1.5.1). The terms that must be disclosed and consented to by the client include the following: 1) that a division of fees will be made; 2) the identity of the lawyers or law firms that are parties to the division; and 3) the terms of the division. (CRPC 1.5.1(a)(2)). It is important to remember the ethical requirement that the total fee charged by all lawyers cannot be increased by the fee-splitting agreement. (CRPC 1.5.1(3)). Failure to ensure compliance with this requirement could result in the total fee charged being found “unconscionable” under CRPC 1.5(a). 

Similarly, California’s ethical rules require that the lawyer must disclose if she doesn’t carry professional liability insurance; the absence of that disclosure would make the fee-sharing agreement unenforceable. (Hance v. Super Store Industries (2020) 44 Cal. App. 5th 676, 689; see also CRPC 1.4.2). 

The California Rules of Professional Conduct permit fee-splitting between lawyers not in the same law firm only so long as the lawyers and the fee relationship between them is disclosed to the client, the client gives his informed consent, and the fee relationship does not increase the cost to the client. And the disclosure must be given, and the client’s consent obtained at the same time as the written fee split agreement between the lawyers or as soon as reasonably practicable after the written agreement. It generally should not be left until such time as a recovery has been realized. 

Keep in mind that once you undertake this co-lawyering arrangement, you are entering into an attorney-client relationship with the client—not just a partnership with the lawyer. Of course, the soliciting lawyer still has ethical and professional responsibilities to the client. One practice tip is that the lawyer being brought in to assist should not assume that the soliciting lawyer will address the issue of providing a full and frank evaluation of the merits of the case with the client. It is strongly recommended that the associating lawyer not agree to the arrangement without first meeting the client and obtaining the client’s consent to her involvement in the case in a face-to-face meeting—just like all other cases she decides to undertake. 

4. Strategy and communication: Communicate with both the client and your ‘partner’ to improve strategic decisions and case results.

Once the co-lawyering arrangement has been negotiated, disclosed to the client, and consented to, you will have both a client and a “partner” to consider in making strategic decisions on the case. The client determines the objectives of the legal representation, as well as decisions affecting the client’s substantive rights, e.g., settlement and waiving a jury. (CRPC 1.2(a) and Comment [1]). Both lawyers in the case have professional and ethical duties to place the client’s interests first. In an ideal situation, both lawyers will agree on the tactical decisions they make. And where such decisions are “significant developments” in the representation, they need to communicate the same to the client. 

However, sometimes there can be significant disputes between the lawyers about the best strategy to pursue. A partnership is not a dictatorship—and that cuts both ways. Talking through the pros and cons of certain strategies can improve the outcome of the case for the client. However, even in the best co-lawyering arrangements, disputes about trial strategy and tactics amongst the lawyers may very well erupt into a conflict under Rule 1.7 that could undermine the client’s best interest. (“Loyalty and independent judgment are essential elements in the lawyer’s relationship to a client.” (CRPC 1.7 Comment [1]). It is important for the lawyers to do their best to reach an agreement that protects the client’s interests. If that is not possible and the associating lawyer determines she should withdraw, (see CRPC 1.16(b)(7)), she must make sure that the client’s interests are fully protected to the extent possible. (CRPC 1.16(d)). As an example, if the lawyer discovers that the soliciting lawyer is mentally unable to try the case, abandoning the client on the eve of trial would not comply with the associating lawyer’s ethical obligation to place the client’s interest first. (COPRAC Opn. 2021-206).

5. Handle the client’s money with care

If all goes well, the case will result in a large verdict with the defendant writing a large check to conclude the case. All the lawyers representing the client necessarily owe fiduciary duties to the client to make sure the client’s funds are promptly paid. (CRPC 1.15(d)(7)). Like the discussion of CRPC 1.5.1’s requirements in section 3, above, do not assume that the soliciting lawyer, who most likely will receive the defendant’s check, will properly account for the client funds. It is important that all lawyers representing the client closely monitor the receipt and handling of client funds. You might consider including a provision in your written agreement with that lawyer that requires the soliciting lawyer to notify you of any steps the lawyer intends to take regarding that check. Regardless, do not close your case file until you have ascertained that the client has been paid. If your co-lawyer has taken the client funds for personal expenses, you can potentially have exposure for liability under your own fiduciary duties owed the client. If your co-lawyer and you get into a post-litigation dispute about fees, it is best not to drag the client into the dispute. (COPRAC Ethics Opn. 2009-177). 

6. Just say no to fee-sharing arrangements with non-lawyers.

While co-lawyering with other California lawyers is permissible under the ethical rules, quickly decline overtures by non-lawyers to cooperate in prosecuting a case.  A fee-sharing agreement between a licensed attorney and a non-attorney is an illegal contract that violates CRPC 5.4(a). 

7. Conclusion: Co-Lawyering cases can work with planning and communication.

Experience has been a great teacher about the importance and risks of co-lawyering cases. A good “co-lawyering” relationship can improve the quality of legal representation and enhance the results. A bad “co-lawyering” relationship can result in great stress and second-generation litigation between the lawyers and even the client. However, with the client’s interest of paramount importance, the respective roles of the co-lawyers need to be clear, and communication with the client must be transparent and consistent.  

Karen Goodman is a trial lawyer and principal of Goodman Law Corporation, practicing out of Sacramento County. She is a member of the CLA Ethics Committee. The views expressed in this article are her own.