A Case Study on Conflicts of Interest- Attorneys Disqualified Based Upon Former Client Representation

Author: Kyle Jones

Guest Editor: Tiffany LeMelle

April 4, 2018 9:40am

Division 1 of the Washington Court of Appeals recently decided a case affecting insurance defense attorneys in their representation of appointed clients. In the matter of In re: Estate of Taylor Griffith, the court considered the interplay between notices of appearance and conflicts of interest under Rules of Professional Conduct Rule 1.9.

Representation in the Underlying Wrongful Death Action

On August 24, 2014, a 16-year-old driver, Taylor Griffith crossed the center line with his pickup truck and collided head-on with Steven Harris’s vehicle.  The collision killed both Griffith and Harris and seriously injured Harris’s wife, Margaret.  Margaret and her daughter (as personal representative for her father’s estate) sued Taylor’s estate and parents alleging joint and several liability under the family car doctrine for the accident.  The complaint alleged the suit was necessary because Griffith’s automobile insurer, Travelers, was not acting in good faith when it refused to disclose Griffith’s insurance policy limits.  Michael Jaeger appeared on behalf of all defendants at the request of Travelers.  He denied liability on the part of Griffith’s parents.

At the time of filing, no personal representative had been appointed for Griffith’s estate.  The estate of Harris petitioned the probate court to appoint Brad Moore as personal representative. Griffith’s parents requested Griffith’s father, Kenneth Griffith be appointed rather than Moore.  At the hearing, the Harris estate argued Moore should be appointed due to his familiarity with wrongful death suits and because the estate’s only real asset was a potential bad faith claim against Travelers.  The Griffiths argued Moore, a known plaintiff’s attorney, was not independent enough to serve as the personal representative of the estate.

The court commissioner observed the potential conflict between the Griffiths and their son’s estate based on the parents’ denial of liability.  He found it was untenable to appoint either parent to the role of personal representative.  The commissioner appointed Moore, expressing confidence he would recognize his fiduciary obligations.  The order appointing Moore allowed him to participate in litigation and to settle or assign claims on behalf of the estate.

On December 9, 2015, following the appointment of Moore as personal representative of Griffith’s estate, defense counsel informed Moore he was planning to file a Motion for Revision of the order appointing Moore.  Moore objected to the Motion and instructed defense counsel not to take any actions against his interests.  He questioned why defense counsel had not filed a Notice of Appearance on his behalf and asked for an explanation of who defense counsel purported to represent.  He also requested analysis of the estate’s potential exposure in the wrongful death case.

On December 15, 2015, defense counsel challenged Moore’s appointment via a Motion for Revision.  On December 16, 2015, defense counsel amended his appearance to state he was counsel to Griffith’s parents and for Moore as personal representative of the estate.  On December 22, 2015, defense counsel again requested Moore step down as personal representative and refused to provide strategic advice based on the pending Motion for Revision.

Around this time, Travelers appointed two more attorneys to serve as defense counsel: Jacquelyn Beatty and Michael King.  Beatty’s appearance was on behalf Griffith’s parents and Taylor’s estate.  King’s appearance was on behalf of “defendants.”

On December 18, 2015, the Court granted plaintiffs’ Motion for Partial Summary Judgment establishing liability and causation on the part of Griffith, but not Griffith’s parents.  Trial began on January 4, 2016.  Beatty introduced herself to the court as “personal counsel for the Griffiths.” King was introduced as a lawyer “with the defense.”  On January 5, 2016, plaintiffs moved to dismiss Griffith’s parents without prejudice. The motion was not opposed.  Plaintiffs thereafter requested the defense attorneys to identify their respective clients.  All three attorneys responded they represented the Griffith estate.

That afternoon, Moore, as personal representative of Griffith’s estate, presented an agreement to the court, signed by plaintiffs’ counsel and the estate, to arbitrate the remaining claims.  Defense counsel objected, but the court signed an arbitration order over the objections. Defense counsel filed notices withdrawing as counsel for the estate over the following days.  Beatty and King’s notices stated they continued as counsel for Griffith’s parents.

Beatty appeared on behalf of Griffith’s parents in the probate action (where the Motion for Revision was still pending). She moved for permission to participate as intervenors in the wrongful death action and for a stay of arbitration pending a ruling on whether Moore could continue as personal representative to the Griffith estate. The court granted both motions over plaintiffs’ objections.

Examination of the Representation in the Court of Appeals

In addition, King filed an action based on the Trust and Estate Dispute Resolution Act (TEDRA) on behalf of Griffith’s parents to remove and replace Moore as personal representative.  Thereafter, the Harris plaintiffs filed a motion under Rules of Professional Conduct Rule 1.9, disallowing Beatty and King from representing Griffith’s parents.  The court granted the motion, disqualifying King and Beatty from representing Griffith’s parents in the wrongful death, probate, and TEDRA actions.  Counsel appealed.

As a threshold matter, the Court of Appeal determined Beatty and King had standing to appeal the ruling based on the potential for adverse consequences arising from the finding of a violation of a Rule of Professional Conduct.  The Court of Appeal thereafter considered the sole issue in dispute: whether Moore was Beatty and King’s former client.

Beatty and King argued the Griffith estate was their client but Moore was not.  The court rejected the contention, observing probate law standards deeming an attorney-client relationship to exist between the attorney and personal representative of the estate.  In essence, the personal representative is the estate.  Accordingly, when Beatty and King withdrew from representing the estate, Moore became their former client.

Beatty and King also argued Moore could not be their former client because he never had a subjective, reasonable belief they were his attorneys.  To this end, they introduced correspondence from Moore sent on the second day of trial stating, “Let’s be clear: I am the P.R. of the Griffith Estate. You do not represent me or the Estate (in spite of your prior representations to the court to the contrary). . . . You are not authorized to make any representations on the Estate’s behalf. As you told me yesterday at the courthouse, you represent Mr. and Mrs. Griffith.”  Incredibly, the court found the email fell short of demonstrating Moore’s subjective belief that the lawyers who had appeared for the estate owed him no duty of loyalty.  In addition to the lack of subjective belief on the part of Moore, the court observed the circumstances present, such as Beatty and King entering formal appearances on behalf of the estate in the wrongful death action. The court found these circumstances did not make it reasonable to doubt the attorney-client relationship.

As a result, the court held a lawyer appointed by an insurance company to defend two clients, and who files a notice of appearance on behalf of each of them, may not continue to represent only one of those clients without satisfying the requirements of Rules of Professional Conduct Rule 1.9.  In the instant case, because Moore refused to waive conflicts, the court found Beatty and King were properly disqualified.

In Re: Estate of Taylor Griffith Illuminates the Problems that Can Arise in Representation

The In re: Estate of Taylor Griffith involved an almost unimaginable course of events.  The Griffith’s lost their son in a tragic car accident.  Then, plaintiffs brought a lawsuit against the Griffith estate and were given the right to appoint the personal representative to the estate.  Griffith’s father was denied the opportunity to serve as personal representative to his son’s estate based on apparently groundless accusations that the parents were jointly and severally liable for the accident which gave rise to a conflict of interest (plaintiffs voluntarily dismissed the claims on the second day of trial).

Meanwhile, the appointed personal representative refused the counsel of the appointed attorneys and agreed with attorneys for the plaintiffs to arbitrate damages over his own attorneys’ objections.  The interests of the plaintiffs and the Griffith estate were directly adverse. In contrast, the interests of Griffith’s parents were only potentially adverse based upon an alleged, but not pursued, theory of relief.  Yet the plaintiffs were granted the power to appoint the representative of the Griffith estate, and the attorneys tasked with defending the plaintiffs’ lawsuit were disqualified.  Both the procedure and outcome of this case are problematic.  In future cases, if issues similar to this case are not addressed by a higher court, the potential for abuse will be rampant.

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