Opinion 260

18 Baylor L. Rev. 336 (1966)

INSURANCE - SALARIED ATTORNEY - CONFLICTING INTERESTS - CANDOR - INTERMEDIARY - SOLICITATION
Though many situations can be visualized which could involve unethical conduct, it is not, per se, unethical for:

1. An attorney, who is employed by an insurance company and who files and handles subrogation suits for said company as well as defending liability cases in behalf of the company in the name of the insured up to the company's limits of liability, to represent an insured in such subrogation suits for his deductible.
2. The attorney for the insurance company to carry the burden of the trial, when the insured signs pleadings and represents himself for his deductible amount.
3. The attorney, though insured has filed a cross action in action pending against him and intends to represent himself in such cross action, to continue as counsel in such suit when, in fact, said attorney will represent insured on his cross action since he appears as attorney of record for the insured.

Canons 6, 19, 24, 32.

The committee feels that, in the present inquiry, the questions are so abstract and devoid of facts that they are difficult to answer specifically.

1. The committee thinks that there is nothing improper per se about a salaried attorney for one plaintiff (insurer, or Company) also representing the other plaintiff (insured or N) who is a part owner of the one cause of action which is being asserted. See Opinions 89 and 167, and ABA Opinion 282. There could be situations in which such representation would involve unethical conduct: e.g., the insurer might act as an intermediary by suggesting to N that M would represent him, or M might make this suggestion (cf. Opinion 202), or the interests of Company and N might be adverse to one another, or Company might claim part of the fee charged N by M. See ABA Opinion 282. However, on the bare facts submitted here, the committee thinks there is no impropriety.
    
2. A litigant may represent himself, and a non-lawyer party appearing pro se is not subject to the Canons of Ethics. Therefore, we are not concerned with the ethics of N, assuming he is not a lawyer, and the committee sees little ethical complications. M may be worried about carrying the burden of the case, but he must do this to represent his own client, Company, and the fact that this incidentally is of great benefit to N does not make it unethical. If M is really the attorney for N but is misrepresenting the situation to the judge by falsely claiming that N has no attorney, Canon 19 is violated; also, this apparent pro se situation if in form only would not solve a problem of conflicting interest between Company and N.
    
3. Suit is against N, and M has been supplied as defense counsel by Company pursuant to the terms of the liability policy. N himself prepared and filed a counterclaim, intending to continue to represent himself in the case. M is concerned whether he must withdraw since to remain in the case indicates that he is representing N on the counterclaim as well as in the defense of the original suit.
   
   Generally speaking, and recognizing that the particular liability policy involved could change the respective rights and duties of the parties, the company has both the duty and the right to supply the defense counsel and to defend the case without the connection of Company being called to the jury␣s attention. So M is representing both N and the Company, in defending the original case. N has a duty of cooperation with Company under the cooperation clause of the policy. Probably filing the counter-claim does not violate that duty for it may well be that the counterclaim is a mandatory one which N must file or the claim will be lost.
   
   M's duty to clients N and the Company as to the defense of the original suit is such that M may ethically either represent N on the counter-claim or give the appearance that he is representing N if N wants to handle the counterclaim himself, although the latter may result in a difficult situation for the Company. From the standpoint of M's ethics, two problems appear: First, the solicitation provision of Canon 24 would seem to prevent M's using the inherent coercion of the situation to require N to pay him a fee for handling the counterclaim. This would not keep M, without additional fee, from representing N on the counter-claim if M did not stir up this additional litigation and if it is reasonably necessary for M so to represent N in order to defend the original suit properly. See Opinion 179. There would seem to be no harm in a suggestion by M to N that he will handle the counterclaim with fee if M needs to do so in order to defend the case properly. Secondly, in defending the suit and in prosecuting the counterclaim, M may be confronted with conflicting interests (e.g., in defending the suit it matters little whether N is found negligent so long as the original plaintiff is found to be guilty of negligence which proximately caused the collision, but negligence of N would be fatal to the counterclaim). Generally see Keeton, 13 Vanderbilt Law Review 837, at 857-8. The possibility of conflicting interest problems arising in this situation does not require M to refrain from taking over the cross action, but it does require M, if he suggests to N that he will handle the counterclaim as part of his defense duties, to explain fully the potential conflicting interests and to obtain consent of both N and Company. See Canon
   
   Little authority has been found on this exact question. Opinions 240 and 76 are slightly analogous, and ABA Opinion 282 is most nearly on point. (9-0)