Brad W. Dacus, Esq. - Pacific Justice Institute, President
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1 , Esq. - Pacific Justice Institute, Brad Dacus served as Legislative Assistant to U.S. Senator Phil Gramm, and went on to receive his Juris Doctorate from the University of Texas, School of Law. For the next five years, Mr. Dacus coordinated religious freedom and parental rights cases throughout the Western states. In 1997, Mr. Dacus founded Pacific Justice Institute, where he serves as and continues to defend religious liberties and parental rights. The Pacific Justice Institute has a network of approximately a thousand volunteer affiliate attorneys and handles more cases on the West Coast than any other organization of its kind. Brad Dacus has been a guest speaker on numerous radio and television programs, participates weekly in several radio talk show interviews, and has appeared on ABC's "Good Morning America," "The Today Show," "CNN," "Hannity and Colmes," "News Talk TV," "MSNBC," "NBC News," NBC "Dateline" and many times on the "O'Reilly Factor." Mr. Dacus' varied public speaking opportunities include public debate, on two occasions, against the president of the ACLU, and on another occasion, against the president of "Americans United for Separation of Church and State." In April of 2007 he testified before the United States House of Representatives in Washington, D.C. in opposition to H.R Local Law Enforcement Hate Crimes Prevention Act of He has also testified numerous times before the California State Legislature on legislation affecting religious freedom and parents' rights. He has guest lectured at Stanford University School of Law. Mr. Dacus continues to speak regularly at churches, conferences, graduations and conventions throughout the United States, including pastors legal seminars and workplace seminars co-sponsored by Pacific Justice Institute with local churches and Christian colleges and universities. DISCLAIMER: The following materials and accompanying Access MCLE, LLC audio CLE program are for instructional purposes only. Nothing herein constitutes, is intended to constitute, or should be relied on as, legal advice. The author expressly disclaims any responsibility for any direct or consequential damages related in any way to anything contained in the materials or program, which are provided on an as-is basis and should be independently verified by experienced counsel before being applied to actual matter. By proceeding further you expressly accept and agree to Author s absolute and unqualified disclaimer of liability. 1
2 SETTLEMENT, LEGAL ETHICS, AND PRO BONO REPRESENTATION I. Introduction A. Justice Scalia on Legal Ethics - In his dissent in Holland v. Florida, decided this term, Justice Scalia noted that legal ethics was the least analytically rigorous and hence most subjective of law-school subjects. - This presentation will show that there is nothing subjective about the ethical considerations surrounding the decision of whether or not to settle a case. The decision of whether to accept or decline a settlement offer belongs to the client, alone, and the attorney may not interfere with it. B. General Overview 1. Attorney-Client Interests in Pro Bono Cases 2. Relevant Legal Principles and Rules of Conduct 3. Discussion of Relevant Experiences Involving Settlements 2
3 II. Interests of Attorneys and Clients in Pro Bono Cases The Problem: The decision of whether to settle a pro bono case is affected by the circumstances of pro bono representation, which differs from an ordinary case because no money is exchanged between the attorney and the client. Because no money is exchanged, the attorney and the client s interests may conflict in unique ways. A. The attorney and the client may have slightly different interests. 1. The attorney is interested in resolving the case as quickly as possible, while still vindicating the interests of his client, and recovering fees when they are available. 2. The client is primarily interested in vindicating his claim, and is likely not concerned about the expense or time required to do so, because he does not bear the costs ordinarily incurred by litigation. B. These interests may affect the decision of whether and when to settle the case. 1. The client may refuse to take a settlement offer that the lawyer believes to be in the client s best interest. - The client s reasoning: My interests will not be fully vindicated unless I have my day in court. - The lawyer s reasoning: This settlement may the best result for my client. 2. The attorney may be tempted to persuade a client to take a settlement offer that is not in his client s best interest either because the settlement will bring the case to a close, or the settlement includes an award of attorney s fees which may be unavailable later in the litigation. 3
4 III. Relevant Legal Principles and Rules of Conduct A. All authorities recognize that the decision whether to settle the case belongs to the client, alone, and the lawyer cannot enter settlement without the client s personal consent. 1. ABA Model Rules of Professional Conduct The Model Rules are explicit: A lawyer shall abide by a client s decision whether to settle a matter. Rule 1.2(a). 2. Restatement 3d of The Law Governing Lawyers - The decision of whether and when to settle a claim is reserved to the client, except when the client has validly authorized the attorney to make that decision on his behalf. Rest. 3d 22(1). - However, even if the client has validly authorized the attorney to make such a decision, the client may still revoke that authorization at any time. Rest. 3d 22(3). 3. California State Law Under California Code of Civil Procedure 664.6, the court may enter judgment on settlements to which the parties to pending litigation stipulate. However, an attorney cannot bind his client to a settlement without the client s specific authorization. Bice v. Stevens, 160 Cal.App.2d 222 (1958). 4
5 B. There are consequences for settling around the client (settling when the client wishes to proceed with litigation, rather than settling). 1. The settlement may not be enforced. Bice v. Stevens, 160 Cal.App.2d 222 (1958). 2. If the opposing side reasonably relies to its detriment on the authority of the attorney to settle the case, and the attorney does not have that authority, the attorney may be held personally liable for the detriment suffered. See Covenant Mutual Ins. Co. v. Young, 179 Cal.App.3d 318, 320 (Cal. App. 2d Dist., 1986) (rule derived from law of agency). C. When a disagreement arises about whether to settle the case, or to proceed with litigation, the remedies available to the attorney are limited. 1. The attorney likely may not withdraw from the case because the client refuses to accept his advice regarding whether to accept or decline a settlement offer. a. ABA Model Rules - The lawyer may withdraw from representing a client when the client insists on doing something with which the attorney has a fundamental disagreement, when withdrawal will not adversely affect the client. Rule 1.16(B)(1), (4). - However, a client s rejection of the attorney s recommendation regarding the settlement decision likely does not provide adequate grounds for withdrawal, because that decision is the client s to make in the first place. ABA Model Rules of Professional Conduct, Annotation to Rule 1.16(B)(4). 5
6 b. California Rules of Professional Conduct - If the case is not being litigated, then an attorney may withdraw when the client insists that he do something that is against his professional judgment and advice. Cal. Rules of Professional Conduct, rule 3-700(C)(1)(e). - If the case is being litigated, the attorney may withdraw when the client s conduct makes further representation of the client unreasonably difficult to carry out the employment effectively. Cal. Rules of Professional Conduct, rule 3-700(C)(1)(d). Nevertheless, disagreement regarding whether to settle a case likely is not sufficient grounds for withdrawal because, again, the client s right to refuse settlement is absolute. The Rutter Group: California Practice Guide, Professional Responsibility, 10(B)(3)(e)(1)(b). This rule is relevant to whether withdrawal was justified for the purposes of determining whether the withdrawing attorney would be able to recover fees for services rendered prior to withdrawing from the case; it does not reach the issue of when conduct related to withdrawal would be sanctionable. - Indeed, few cases address the circumstances under which an attorney may permissibly withdraw from representation. Ram v. Cooper, 2002 WL , *12 (Cal. App. 5th Dist., 2002). - In any event, withdrawal must be done with care: A member shall not withdraw from employment until the member has taken reasonable steps to avoid reasonably foreseeable prejudice to the rights of the client, including giving due notice to the client, allowing time for employment of other counsel, and complying with other procedures prescribed for the termination of representation, such as releasing documents to the client. Cal. Rules of Professional Conduct, rule 3-700(A)(2). 6
7 2. The attorney may not include a clause in a representation agreement that vests in him the ability to decide whether to settle the case, or requiring his approval to settle the case. - Rationale: Public policy requires preserving the client s right to unilaterally make decisions regarding the disposition of his case. In Re Van Sickle, 2006 WL , *8 (Cal. Bar Ct., 2006). See also ABA Model Rule 1.2(a); Jones v. Feiger, Collison & Killmer, 903 P.2d 27, 33 (Colo. App. 1994). IV. Discussion of Relevant Experiences Encountered in Case Settlement 7
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