I’m Your Lawyer – You Can Trust Me – Starting….. Now

This morning I offer two posts, only tangentially related, in that they both deal with the broader topic of alternative dispute resolution. This first post relates to a new unpublished court of appeals opinion dealing with arbitration clauses in attorney fee agreements.  The second post is pure and unadulterated rantings about the facilitative mediation process, and my own prejudices re same.

As to the case, it is called Rozanski v Findling.  To read the case, click on the name.

Historically there has been much discussion as to what an attorney can slip into a fee agreement that might be self-serving, and whether a provision requiring disputes to be resolved through arbitration would be crossing that line (i.e., enforceable). After all, the client is entering into a contract with his/her own lawyer.  So, before I am your lawyer, or as I am about to become your lawyer, how fair do I have to be with you with respect to the terms of my engagement?  It’s a conundrum about which there has been much discussion.

This case doesn’t discuss any of that. Rather it notes that arbitration is favored under Michigan law, and as such, enforceable in this case in which the arbitration clause was part of an engagement agreement between a client and his lawyer.  So, by implication, arbitration clauses in attorney fee agreements are ok.  Again, unpublished opinion, limited issues raised.

So I guess it’s like: Ok now that you’ve signed this contract I am your lawyer and from this moment forward I will always act in your best interest and with a pure heart – but up until the moment you signed that contract I was free to screw with you and use my superior understanding of the law to my advantage.

I’m thinking we’re going to see arbitration provisions added to a lot of attorney fee agreements going forward. And if you’re a facilitative mediator, it may be time to get certified as an arbitrator too.

Finally, one quote from the case I would point out:

“A three-part test applies for ascertaining the arbitrability of a particular issue…”

Arbitrability? Is that even a word?

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Attorney-Fiduciary Relationships

A new published circuit court case addresses the often confused issue of who an attorney hired by a fiduciary represents and is accountable to. This is technical stuff, so if you’re not in the mood or you don’t do this type or work, spare yourself and read no further.

In Estate of Tyler Jacob Maki (click on the name to read the case); the Court of Appeals affirms the trial court, and in doing so, holds that an attorney who is hired by a conservator cannot be sued for negligence by a subsequently appointed conservator. This is true because there is no attorney-client relationship between the subsequent conservator and the attorney, and also because the ward is not a third-party beneficiary of the contract between the first conservator and the attorney.

This issue comes up periodically. It is not unimportant.  At times appellate courts generate decisions that feed into the confusion.  However, this Court reaches the conclusion that I think most probate practitioners believe is the right result, and the result intended by MCR 5.117(A).  Presumably, this decision can be extended to cases in which other types of fiduciaries retain lawyers.

A lot more could be said about this issue and this case. I will limit my thoughts to these few additional points:

In a footnote the COA recognizes the apparent injustice in the result – the result being that if a person who is under the protection of the court has a fiduciary, and that vulnerable person is injured as a result of the bad acts of their court-appointed fiduciary, and that harm could have been avoided if the lawyer representing the fiduciary (and being paid by the ward) had taken steps to protect the ward, a subsequent fiduciary appointed to clean up the mess can’t seek recovery from the lawyer even if they could show that the lawyer’s conduct was negligent. The COA says, that may not be good public policy, but public policy is not their job.  Take it up with the legislature.

Second point, the COA glosses over the fact that the conservator, who stole money from the ward, was apparently not sufficiently bonded. I don’t know the facts and there is very little in the opinion to go on.  But when you read this opinion you can’t help but wonder: How did this ever turn into a malpractice action against the lawyer? Or, said another way: Why didn’t the bonding company make the ward whole?  As best I can make out from the opinion, the reason that the conservator was apparently not sufficiently bonded is because the lawyer didn’t report the money from a personal injury settlement paid to the ward on the inventory or accountings because the lawyer, knowing that the settlement was subject to a confidentiality provision, didn’t think he had to.  Well, if that is what happened, there’s something very wrong with this picture.  Clearly the Trial Court would have been informed of the settlement, and clearly there are ways to set a sufficient bond without putting the amount of the settlement in the record.

Finally, in its decision, this Court spends time distinguishing between “standing” and the “real party in interest” rule which, for litigators, may be worth a read.

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Playing with Knives

There’s a saying among litigators. It goes like this: Lawyers play with knives but never get cut.

The idea (or image) is two lawyers facing each other holding knives, with their clients in between. When the case is over, the clients are bloodied but the lawyers remain unscathed. It’s a coarse image – but there is a truth in it that allows the saying to survive.

Litigation is a mean game – at times brutal. It is common for clients to dislike (at times, vehemently dislike) the opposing party’s attorney. And it is sometimes hard for clients to understand how the lawyers in the case remain collegial throughout the process. They wonder: Why is my lawyer talking to that other lawyer about his/her kids or their practice? Why doesn’t my lawyer see what an a-hole s/he is?

But lawyers are like that. Civility and professional courtesy is part of our creed, or way of thinking. It is an integral part of how the system works (See “The Romance of the Law” below).

However there can be rare cases where the lawyers are cutting each other. Lawyers don’t like these cases, and Judges like them even less. Yet, in certain situations, if the attorney is going to adequately represent their client, it can’t be avoided.

In my practice this dynamic can come up in contested guardianship/conservatorship matters.

It is common in these matters to have a vulnerable adult who can be manipulated – and who will voice the preferences of whoever they are physically in the presence of (or under the control of) at the time. As a result, the person(s) or faction that has the most physical access to the vulnerable adult while the litigation is pending can often assert that they are acting in a manner consistent with the desires of the vulnerable adult, even though the truth is that: were the vulnerable adult allowed to spend sufficient time with the other parties, that vulnerable adult’s views would change to align with those parties. The upshot is that s/he that controls the vulnerable adult can take the vulnerable adult to a lawyer who can claim to represent the vulnerable adult, advocate for the objectives of the controlling faction, and use the vulnerable adult’s money to pay the costs of litigation.

Of course, an attorney should not do this. They should carefully assess whether their purported client has the capacity to retain legal counsel at all; and if so, take steps to separate the client from members of the faction to determine whether or not the expressions of the vulnerable adult client are in fact their own preferences, or simply the result of manipulation of the controlling faction. Where the attorney fails to protect their client in this way, the attorney representing the non-controlling faction may be forced to raise the issue to the court.

Although Michigan courts have yet to directly address this topic, some interesting work has been done in California. A report from the Estate Planning, Trusts and Probate Law section of the California State Bar; includes the following:

 

The existing statutory law concerning the appointment of an attorney by the court for a proposed conservatee who appears with a lawyer who contends that he or she is the proposed conservatee’s lawyer, is very unclear. Probate Code §§ 1470 and 1471 provides statutory authorization for the court to appoint an attorney to represent a proposed conservatee when the conservatee lacks counsel to represent himself or herself. Neither code section addresses a situation where a lawyer contends that he or she represents a proposed conservatee, but the court has serious doubts about whether the proposed conservatee has the capacity to hire the would-be attorney as the proposed conservatee’s attorney. The right to choose one’s counsel is a right with which courts are reluctant to interfere.

Unfortunately, it is common for the perpetrator of elder fiduciary abuse (“perp”) to arrange for a lawyer to represent a proposed conservatee in opposing the appointment of a conservator, or in seeking to have the perp appointed as the conservator. See, e.g., Conservatorship of Chilton, 8 Cal.App.3d 34, 86 Cal. Rptr. 860 (Second Dist. 1970), where (according to the Court of Appeals) Attorney Arditto really was the lawyer for the perp, although he pretended to be the lawyer for the proposed conservatee. Arditto litigation in opposition to the conservatorship, and took other steps that were supportive of the financial abuser, who also entered into a subsequently voided marriage with the incompetent.

The case of Conservatorship of Chilton, 8 Cal.App.3d 34, 86 Cal. Rptr. 860 (Second Dist. 1970) stands for the proposition that the lawyer who appears “for” the proposed conservatee, to oppose a conservatorship, can be acting in reality for the perpetrator against the best interests of the manipulated and incompetent proposed conservatee.

 

Emphasis added. Click here to read the report.

These situations seem to be a natural byproduct of the increasing number of contested guardianship/conservatorship matters. At this stage, Michigan courts don’t seem comfortable addressing this issue – and the attorney who makes accusations about opposing counsel can be seen as crossing that critical line by using their knife to slash fellow counsel. But litigation can be a rough sport – and when these situations arise, there may be no other options.

 

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Attorney-Client Relationship Part III: Client Control

Litigation is a lot of things: expensive, slow, volatile and unpredictable (FYI, some of the things that from the lawyer’s perspective make it fun).  Clients would love to know from the beginning, What will this cost?, How long will it take?, and most of all: How will it come out? At that first meeting, the lawyer can’t answer any of these questions.  As the case progresses, the lawyer should be able to provide more definition –  but their answers are never without exceptions and disclaimers.  Accordingly, in litigation matters, the relationship between the client and lawyer is always a challenge.

From the lawyer’s perspective what really happens in that first meeting is that the lawyer begins to establish the ground rules of client control and client expectations.  These are the two dynamics that will ultimately determine how the case is resolved, and whether the client is satisfied with that result.

Client control is key.  It provides the lawyer with the ability to negotiate settlement discussions – not just settlement of the entire case, but resolution of the numerous interim issues that arise while the case proceeds.

Lawyers who lack client control end up going to court to fight over interim issues that should not require court involvement.  But because they can’t convince their client that this side issue isn’t worth going to court over, they end up in front of the court arguing about things that make them look unreasonable.  This doesn’t just drive up everyone’s costs, but more critically, it begins to paint a picture in the mind of the judge about which side of the case is unreasonable – and that is huge.  Judge’s don’t like unreasonable clients.

Successful lawyers don’t let themselves get suckered into these types of sideshows.  They maintain  the trust of their clients, and accordingly, the client lets the lawyer make decisions about case strategies.

Closely related to the concept of client control is the concept of client expectations.  If a lawyer promises the moon, the only two possible results in the client’s mind: I got what I deserved, or my lawyer screwed up.  Lawyers who ineffectively manage client expectations rarely have happy clients.

Successful lawyers don’t overpromise.  I always look at cases from the perspective of the other side.  What would I argue if I represented that client?  Where are the weaknesses in my own case?  With that perspective, as the case unfolds, the successful lawyer helps the client understand the risks of their case, and what might be a reasonable resolution – which is rarely (if ever) that they are going to get everything they think they deserve.

Managing clients and their expectations is a big part of handling a case.  The relationship with the client should never be allowed to get too hot, or too cold.  As the case develops, as evidence is revealed, and when the client’s expectations start to stray from reasonableness, clear and direct conversations occur to rein them back in.  These periodic adjustments are central to the ability of the client to maintain trust in the attorney, and to be prepared for a result which, although it may not be all they had hoped for, they can understand and accept.

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The Attorney-Client Relationship Part II: Arc of the Love Affair

We love our lawyers the day we hire them.  They seem smart and focused (or we would not have signed up).  But as time goes on, doubts and concerns slip in.  They don’t return our calls as fast as we would like, they misspell a name, in talking to them they don’t recall an important fact that we previously advised them about.

So here’s the deal:

If your lawyer is good, they have a lot of other things going on, a lot of other clients, and they are not necessarily preparing everything that goes out (they have staff/associates for that).  This isn’t what you should be focused on.  From the lawyer’s perspective, what matters is that they are staying on top of the case, and that you and they will be ready to peak when the critical events occur (mediation, trial, etc).

From the lawyer’s perspective, maintaining a comfortable attorney-client relationship is part of the challenge of handling the case.  For the lawyer, this is about maintaining an even keel.  Part of this has to do with client expectations (discussed below), but part of it is just staying in touch enough so that the client doesn’t feel (and in fact, isn’t being) neglected during those slow periods.

Cases go on and on.  Most major litigation matters continue for a least a year, often two or three years.   This means that there are times when the lawyer will be focussed on other matters s/he is handling.

At the end, the relationship should come together again.  When the case is mediated and/or tried, the lawyer should be everything you expect of them: focused, knowledgeable and confident.  They should be able to explain what is going on and why they are making the decisions that are being made.  They should have a well-conceived plan/a strategy.

And hopefully the result is consistent with your expectations, which is not necessarily everything you want, but at least close to what your attorney told you to expect.

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Attorney-Client Relationship Part I: Reputation

Among lawyers, reputation is a big deal.  At least initially, clients don’t always understand or appreciate how important their attorney’s reputation (and the reputation of the opposing party’s attorney) is in a case.

Attorneys who have good (or even exceptional) reputations – that is, they are reputed to know (or to be experts in) the area of the law they are practicing in, are at an advantage when it comes to litigation.  This is because their reputation influences both the judge and the opposing counsel.

When an attorney with a reputation for being skilled files an appearance in a case, the opposing counsel knows:  This person knows what they are doing and I won’t be able to bully them or trick them.  I better have my act together or I could end up looking stupid in front of my client and the judge.

When an attorney with a reputation for being skilled enters a courtroom the judge knows: This is someone who knows what they are doing.  That means I can rely on their research and their representations about the law and facts. I can trust that they know the likely outcome of the case and will work to settle the case in a reasonable manner.  The judge also knows that a skilled attorney will always be thinking about the next phase – the appeal – and the decision the judge makes will be made with more caution when they think an appeal could be pending.

There are a lot of lawyers out there.  Some would say (and I would agree) too many.  Because of this, clients can always find someone to handle their cases less expensively.  Lawyers who have no focus to their practice or who do sloppy work, have little to offer to the client who simply wants something done cheaply – except: I will do it cheaper than the next guy/gal.

Lawyers with a reputation can say: you can get it done cheaper somewhere else, but if it is results that you want, you might want to consider paying more to hire me.

Lawyers who have established reputations understand the added value that their reputation provides, and jealously guard that reputation.  These lawyers won’t compromise their reputation for a client who wants them to advocate unreasonable positions.  Doing so is just going to hurt their reputation, which will negatively influence them in this case, and in cases to come.

Lawyers without reputations to protect will allow themselves to be controlled by clients with unreasonable objectives, because they can’t afford to lose the client.  This of course just erodes their reputation in the eyes of the judge and opposing counsel (and, in case you were wondering, attorneys talk about this kind of thing among themselves).

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