ATTORNEY-CLIENT RELATIONSHIP c. Authority Within The Relationship

1. Primary roles of lawyer vis-à-vis client • Adviser • Advocate (rep. to court) • Agent (rep. to others) • Sources of law governing agency function • General law of agency (mostly common law) with specific application to legal services (Silver Street, p. 139) • Ethics rules: MRPC 1.2 (duties to the client!) ATTORNEY-CLIENT RELATIONSHIPc.Authority Within The Relationship

2. Problem pp. 138-9 • On what theory might Carl be bound by the settlement agreement? • actualauthority to sign on his behalf? • express authority? • Do you have enough information to answer that? • Who has the burden of proof? • implied authority? • what facts would Maude rely on? • How does Silver Street answer it? • How does MRPC 1.2(a) bear on it?

3. Enforcing settlement c’t’d • Did you have apparent authority? • how does this differ from “actual”? • Silver Street and n. 2 p. 142-3 – any basis for finding such authority in our problem? • n. 4 p. 143: is the Missouri case consistent with the general concept of “apparent authority”? • n. 5 p. 143: If Maude shows apparent authority and wins judgment against Carl, does that foreclose a malpractice action by him against you?

4. Enforcing settlement c’t’d • Possible solutions for you? • Put a clause in retainer agreement expressly authorizing you to enter into any settlement of the claim which is “reasonable and fair to client.” Permissible? Under what conditions? • Insert a clause whereby client agrees not to settle the claim without your consent? • safety first: get clients’ signatures on any agreement before relying on it?

5. Authority c’t’d • When Carl insists that you • depose Maude rather than using interrogatories • seek a change of venue • subpoena Maude’s tax records • what are your obligations? MRPC 1.2(a) • suppose Carl doesn’t “grudgingly acquiesce”? What do you do?

6. D. THE TRUST ACCOUNT • ABA Canons of Prof. Ethics, Canon 11 (Supp. p. 490) • don’t take advantage of client’s confidence for personal benefit • report and account for any money or “trust property” coming into your hands • don’t “commingle” client’s funds with your own • Wilson, p. 145; ABA Standards for sanctions, p. 146: knowing conversion = disbarment! • ABA Model Code DR 9-102, MRPC 1.15: “client trust account” requirement for funds • do you need a separate account for each client?

7. Problem pp. 144-5 • Check to you from client for $1,500: what do you do with it? • What is it for? • To whom do the funds belong? • Next day obtain doctor’s reports (cost $550) and hospital records ($250): how do you pay for them? • write checks on the trust account? • write checks on your personal account, then write a TA check to yourself as reimbursement?

8. Problem p. 144-5 c’t’d • File suit for client against neighbor, settled, you receive check for $150K made out to client and you – what do you do? • To whom do the funds belong? (contingent fee!) • can you just deposit it in the TA? • endorse it and give it to client for his endorsement? What risk? • Deposit it, then write TA checks to self and client for respective shares? • What risk? • If settlement check bounces, but there are sufficient other funds in TA, any problem?

9. Problem p. 144-5 c’t’d • Sandra is executor of uncle’s estate, receives his collections of baseball cards and coins, gives them to you for safekeeping – what do you do with them? (Grubb, p. 157; MRPC 1.15(a)) • You ask for $500 check for fees and expenses; when you get it, you have already earned $300 in fees and expended $250 – what do you do with the check?

10. Problem pp. 144-5 c’t’d • Interest-bearing Trust Account (ITA)– what happens to the interest? • if it is a separate account for a single client? When would you be required to do this? • if it is a multi-client account? • Brown, p. 150 – State IOLTA plan requiring interest to be paid into a bar-controlled fund for legal services purposes • Is there a taking as defined in fed. Const.? • If so, is any compensation required?