UPON THE REQUEST OF A MEMBER OF THE SOUTH CAROLINA BAR, THE ETHICS ADVISORY COMMITTEE HAS RENDERED THIS OPINION ON THE ETHICAL PROPRIETY OF THE INQUIRER’S CONTEMPLATED CONDUCT. THIS COMMITTEE HAS NO DISCIPLINARY AUTHORITY. LAWYER DISCIPLINE IS ADMINISTERED SOLELY BY THE SOUTH CAROLINA SUPREME COURT THROUGH ITS COMMISSION ON LAWYER CONDUCT.
Ethics Advisory Opinion 03-01
Factual Summary
Attorney X, licensed in New York, has been admitted pro hac vice, to represent a New York corporation in a civil case pending in a circuit court in South Carolina. As required by the Court’s Order, Attorney X retains Attorney Y, an attorney licensed in South Carolina, as local counsel of record. Attorney X and his client, who wish to minimize legal expense, request that Attorney Y do nothing except “sign all papers and attend all proceedings.” In all other respects, Attorney Y is to act essentially as a “potted plant.”
Attorney Y is willing to agree to this arrangement, provided that Attorney X and his client waive in writing any future legal malpractice claim that may arise as a result of the representation, since, under the terms of the representation, Attorney Y will not undertake sufficient review of the file or other work necessary to be prepared “at all times” to assume full responsibility for the case as required by South Carolina Appellate Court Rule 404(f). Attorney X and his client are willing to agree to the prospective waiver.
QUESTION PRESENTED
Is Attorney Y in violation of the Rules of Professional Conduct, specifically Rule 1.8(h) prohibiting prospective agreements limiting client malpractice claims?
SUMMARY
Under Rule 1.8(h) agreements limiting prospective malpractice liability are valid if (1) permitted by law and (2) the client is independently represented in making the agreement. On the facts presented, the second requirement is met because the client is represented by Attorney X in connection with the agreement limiting Attorney Y’s malpractice liability. The determination of whether the agreement is permitted by law involves interpretation of SCACR 404(f) dealing with the responsibilities of local counsel when out-of-state counsel is admitted pro hac vice. This issue is a legal question beyond the scope of the Committee’s authority. However, the rule likely requires more than the very limited role contemplated by Attorney Y. In addition, Rule 3.4(c) prohibits attorneys admitted to practice in South Carolina from knowingly violating the rules of a tribunal and Rule 8.4(e) forbids conduct “prejudicial to the administration of justice.”
ANALYSIS
Effective July 1, 2002, Rule 404 of the South Carolina Appellate Court Rules was amended. As amended, Rule 404(f) requires that the attorney of record be prepared at all times to assume full responsibility for the case, as well as sign all papers and attend all proceedings.[1]
Rule 1.8(h) of the Rules of Professional Conduct states:
A lawyer shall not make an agreement prospectively limiting the lawyer’s liability to a client for malpractice unless permitted by law and the client is independently represented in making the agreement, or settle a claim for such liability with an unrepresented client or former client without first advising that person in writing that independent representation is appropriate in connection therewith.
Under Rule 1.8(h) agreements limiting prospective malpractice liability are valid if (1) permitted by law and (2) the client is independently represented in making the agreement. On the facts presented, the second requirement is met because the client is represented by Attorney X is connection with the agreement limiting Attorney Y’s malpractice liability. The issue of whether the agreement is permitted by law is more complex.
Although it is not within the scope of this Committee’s charge to resolve questions of law, it is apparent that Attorney X and Attorney Y are attempting to circumvent a rule of the Court. While the Committee can offer no opinion regarding the meaning of the requirement that a local attorney “shall at all times be prepared to go forward with the case; sign all papers subsequently filed; and attend all subsequent proceedings in the action,” it is likely that discharge of this obligation would require more than acting as a “potted plant.” Attorney X and Attorney Y may be held in violation of the rules of court.[2] If so, the agreement would violate Rule 1.8(h) because it would not be permitted by law. In addition, the agreement would violate Rule 3.4(c) which provides that a lawyer shall not “knowingly disobey an obligation under the rules of a tribunal except for an open refusal based on an assertion that no valid obligation exists.”
Rule 8.4 of the Rules of Professional Conduct generally addresses various categories of professional misconduct. Rule 8.4(e) specifically prohibits a lawyer from engaging “in conduct that is prejudicial to the administrative of justice.” Arguably, court rules requiring the appearance and participation of local South Carolina counsel exist to better administer justice within the state. Accordingly, circumvention of these court rules would be a violation of Rule 8.4(e).
Because South Carolina Appellate Court Rule 404 has been so recently amended, it is unknown at present the scope or meaning of the language at issue. For this reason, the Committee recommends compliance with the rule, or a request for relief from the court in which the case is pending.[1] The Federal District Court Local Rules have a similar provision which provides “local counsel shall be present at all pretrial conferences, hearings and trials, and may attend discovery proceedings. Local counsel is expected to be prepared to actively participate if necessary.” Local Civil Rule 83.I.06 DSC.[2] Note that Attorney X, while not licensed to practice in South Carolina, necessarily expressly agreed to be subject to all local court rules when appearing pro hac vice. See, SCACR 404(c)(9) and Local Civil Rule 83.I.05 DSC.