The New Year is a time to reflect on the year gone by. For me, the New Year is a time to reflect on the many cases and clients that we have had throughout the year at our office. Every case is different, and with each one there is a new lesson to learn or a reminder of past lessons learned.
Attorneys are bound by many ethical rules, which are set forth in the Rules of Professional Conduct (22 NYCRR Part 1200). The lawyer is an advocate for the client, and is duty bound to advocate for what that client wants.(1) This means that the lawyer is also bound to abide by the client’s objectives, including the client’s decision to settle a matter. (22 NYCRR 1200 Rule 1.2(a)).
In 2014, we were involved in several cases where our adversary (i.e. our client’s spouse) made a settlement offer that was completely unrealistic for our client, or the spouse making the offer, or both.
For example, in one case, our client’s spouse (“Bob”) wanted to keep the marital residence. But Bob had terrible credit and would have trouble refinancing the mortgage to remove our client from the debt. Bob’s solution to this was to offer to sell the house if he could not refinance, but Bob did not want to sell the house for at least four more years. The problem with this solution was that Bob did not make enough money to afford to maintain the house.
Bob’s proposal presented huge financial risk for our client. If Bob defaulted on the mortgage or otherwise failed to maintain the house, the result for our client would be a foreclosure or bankruptcy (or both), or the house being in such terrible shape at the time of sale that it would negatively impact the sale price. Our client rejected Bob’s proposal.
Interestingly, Bob’s proposal also put him (Bob) in a terrible financial position because he was attempting to hang onto a house that he could not possibly afford. The math was not in Bob’s favor. This was apparent to everyone involved in this case, except Bob.
For me, this case is a reminder that, while attorneys have an obligation to pursue the client’s objectives, the attorney also has an obligation to exercise independent professional judgment and render candid advice to the client. In rendering that advice, the attorney may refer to the law, or moral, economic, social, psychological, or political factors that may be relevant to the client’s situation. (2)
Sometimes a client can be so focused on achieving his objective that he fails to appreciate the consequences that achievement will bring, no matter how much candid advice his lawyer gives to him. Unfortunately, this means that for those like Bob, one can “lose for winning.”
(1)There are a few exceptions to this. For example, a lawyer cannot assist a client in pursuing a course of conduct that is illegal or fraudulent, or would otherwise violate the lawyer’s other ethical duties.
(2)22 NYCRR Rule 2.1.