Ethics Opinon 1976-3
February 3, 1976
SUBJECT: REQUEST FOR OPINION REGARDING SOLICITATION OF POTENTIAL LITIGANTS WITH SIMILAR OR IDENTICAL INTERESTS TO THOSE OF AN EXISTING CLIENT.
An attorney represents a subcontractor who together with other subcontractors and suppliers, has not been paid for his services by the general contractor. The attorney has been employed to enforce his client's lien rights against the owner of the project. His is aware that the other subcontractors and suppliers have the same lien rights and have equal priority inasmuch as they all operated under the same contract. He is further aware that it is not uncommon for similar claims of this nature to be consolidated for trial. Realizing that were one attorney to represent the several lienholders his client would benefit by the necessarily lower legal fees, he pursues one of the following alternative courses of action.
A. He sends a letter to his client on his letterhead suggesting that his legal costs would be greatly reduced were the other nonclient claimants to file their liens and send all their papers to the client to be forwarded to the attorney for the purpose of filing a single suit for foreclosure of all the liens. He suggests in the letter that the client show the letter to the nonclients.
B. He suggests that his client send a letter to the nonclient lienholders inviting them to a meeting at the attorney's office at which meeting, the letter indicates the mutual problem of the subcontractors will be discussed. At the meeting the attorney addresses those assembled and indicates to them that he represents his client, but that it would be better if all of the lienholders would file a common suit and the fees would be divided pro-rata among those who joined in the action. He indicates to them that it would be cheaper if all the claimants got together.
C. He pursues representation of his client's interests. The client on his own initiative contacts the other lienholders and suggests that they get together and recommends that they contact his attorney. The attorney upon receipt of their calls agrees to represent these other claimants.
May an attorney, directly or indirectly, solicit employment from individuals who have a similar interest to his client.
The California State Bar Act, Rule 2?101 states that:
"A member of the State Bar shall not solicit professional employment by advertisement or otherwise."
Rule 2-104(a) states further that he:
" . . . shall not recommend employment . . . of himself . . . to a nonlawyer who has not sought his advice regarding employment of a member of the State Bar."
Canon 27, Canons of Professional Ethics, American Bar Association provides that:
"It is unprofessional to solicit professional employment by circulars, advertisements, through touters or by personal communications or interviews not warranted by personal relations."
The American Bar Association, Committee on Professional Ethics, in Opinion 111 stated that:
" . . . from earliest times, both in England and in America, solicitation of employment by lawyers has been considered beneath the essential dignity of the profession. It has not been claimed that there is anything wrong or inherently improper in such conduct. But it has been believed that it is not compatible with the self respect and best interest of the profession."
It is clear then, that solicitation of employment by an attorney is a practice which the profession regards as beneath its dignity and offensive to its traditions.
A more difficult question is presented; however, where the interests of an existing client would be served by the attorney's collective representation of other persons with a commonality of interest.
While recognizing the difficulty of the question, the American Bar Association in Opinion III stated the general rule in the situation presented by these facts.
The Committee stated:
"An attorney may accept employment from persons having interests similar to that of an already established client; however, he may not participate in any active solicitation of such persons to retain him as an attorney."
This rule makes it plain that an attorney may not personally or directly contact a nonclient and solicit his employment. The more precise question is the degree, if any, to which the attorney may encourage his client to contact the nonclients or on the other hand whether he may accept employment from those solicited by his client without his knowledge or participation.
Where the attorney encourages his client to contact other claimants for the purpose of gaining them as his clients also, he is acting in contravention of the proscriptions of Canon 27. The Committee on Legal Ethics of the Los Angeles County Bar Association dealt with a similar situation in Opinion No. 257. In a situation where, as here in Alternative B, the client sent a letter to nonclients suggesting their employment of an attorney, the Committee indicated that if the attorney participated to any extent in the sending of the letter, such conduct offends Canon 27. However, if on the contrary, the attorney did not initiate the letter and did not participate in it to any extent then he is under no ethical duty to disclaim or disavow it and he may with propriety accept employment resulting from the letter.
In Alternatives A and B where the attorney has either prepared the letter or directed its preparation or has directed or suggested that such information be communicated to nonclients, his action constitutes a participation in an active solicitation and thus is in contravention of the standards set down in Canon 27. Where, however, by the truly independent action of his client he is employed by persons similarly situated, he may accept such employment.
Disclaimer: This opinion was issued by the Legal Ethics Committee of the San Diego County Bar Association. It is advisory only and is not binding upon any member of the SDCBA, any other member of the State Bar of California, the State Bar of California or its Board of Governors, or any persons or tribunals charged with regulatory responsibilities. The SDCBA, its officers, directors, agents, and the Legal Ethics Committee members assume no responsibility or liability in rendering this opinion.