Consider the scenario in which opposing counsel provided a settlement offer that the client approved, but the lawyer has not communicated its acceptance to opposing counsel prior to the client’s death. A zealous advocate may want to communicate that the offer has been accepted to take advantage of the favorable resolution for the deceased client’s heirs, who, for our purposes, are in favor of it.
Here’s the problem: the lawyer has no client. Death terminates the attorney-client relationship, which means the attorney has no actual authority to represent the client (now “former client”). The “authority gap” can be addressed with the appointment of an executor or administrator, who can then retain the lawyer to continue with the representation on behalf of the deceased client’s estate.
Yet, that still does not answer the looming question of whether the lawyer has an affirmative obligation to disclose the client’s death to counsel or the court, and if so, when?
In Virginia Legal Ethics Opinion 952 (1987), the Standing Committee on Legal Ethics noted:
A client authorized an attorney to settle his personal injury case within a range of values. A demand was made and a counteroffer was received from the insurer. Following receipt of the counteroffer, the client died and the administrator of the estate authorized the attorney to accept the last settlement offer which was within the range authorized by the client. It is not improper, given the above, for the attorney not to disclose the death of his client to the insurance company absent a direct inquiry from the insurance company regarding the client’s health.
The committee opines that in order to avoid an appearance of impropriety, the attorney should disclose the death of his client at the time he accepts the offer of settlement and let the opposing side know that the client authorized the range for settlement prior to his death and that the estate’s administrator has also authorized the settlement.
From a practical standpoint, LEO 952 makes sense. The attorney is merely accepting a settlement that his former client had approved and that the estate has ratified. It is efficient in that it puts an end to a dispute only made more complicated by the client’s death and avoids the potentiality that the offer would be rescinded based upon a perception (right or not) that the matter holds less value with a dead party.
Common sense, however, is not the overarching determinant as to what constitutes ethical conduct. In American Bar Association Formal Opinion 95-397 (1995), the Committee (having considered LEO 952) concluded that:
Prior to the death, the lawyer acted on behalf of an identified client. When, however, the death occurs, the lawyer ceases to represent that identified client. Accordingly, any subsequent communication to opposing counsel with respect to the matter would be the equivalent of a knowing, affirmative misrepresentation should the lawyer fail to disclose the fact that she no longer represents the previously identified client.
The ABA Committee’s analysis was based, in part, upon the decision in Virzi v. Grand Trunk Warehouse & Cold Storage Co., 571 F.Supp. 507 (E.D. Mich. 1983). There, the district court set aside a settlement because plaintiff’s counsel had failed to disclose to opposing counsel or the court that his client was dead.
This Court feels that candor and honesty necessarily require disclosure of such a significant fact as the death of one’s client. Opposing counsel does not have to deal with his adversary as he would deal in the marketplace. Standards of ethics require greater honesty, greater candor, and greater disclosure, even though it might not be in the interest of the client or his estate.
The handling of a lawsuit and its progress is not a game. There is an absolute duty of candor and fairness on the part of counsel to both the Court and opposing counsel. At the same time, counsel has a duty to zealously represent his client’s interests. That zealous representation of interest, however, does not justify a withholding of essential information, such as the death of the client, when the settlement of the case is based largely upon the defense attorney’s assessment of the impact the plaintiff would make upon a jury, because of his appearance at depositions. Plaintiff’s attorney clearly had a duty to disclose the death of his client both to the Court and to opposing counsel prior to negotiating the final agreement.
This brings us to Proposed Legal Ethics Opinion 1900, where the Standing Committee overrules LEO 952, and concludes (consistent with ABA Formal Opinion 95-397) that:
The lawyer must disclose the client’s death to opposing counsel or the opposing party if pro se before any further substantive communication. If the matter is before a court, the lawyer must disclose the client’s death to the court no later than the next communication with, or appearance before, the court.
The underpinning is found generally in the Rules of Professional Conduct, which provide that:
Rule 3.3. Candor Toward The Tribunal.
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal;
(2) fail to disclose a fact to a tribunal when disclosure is necessary to avoid assisting a criminal or fraudulent act by the client…
Rule 4.1. Truthfulness In Statements To Others.
In the course of representing a client a lawyer shall not knowingly: (a) make a false statement of fact or law; or (b) fail to disclose a fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by a client.
While LEO 1900 has not yet been approved by the Virginia Supreme Court, the underlying principle remains clear: don’t make misrepresentations, including as to the death of one’s (former) client, by either commission or omission.