The inquirer asks for guidance in the following situation. An insurance company has retained inquirer to defend its insured, an employer ("E"), in a civil action arising out of a motor vehicle accident. The defense assignment extends to E's employee driver ("D") as well as to the owner of the insured vehicle. The owner is E's former partner and permitted E to use the vehicle in furtherance of E's business. The accident occurred when D allegedly negligently collided with plaintiff's vehicle. The inquirer advises that D appears capable of understanding and expressing himself in English but speaks with a heavy accent making communication with D difficult.
The inquirer believes that the court will likely declare that the plaintiff failed to serve D and the owner of the vehicle with process prior to expiration of the applicable two year statute of limitations period, and are thus not subject to the court's jurisdiction. This finding could result in the court likely vacating an adverse verdict against D and the owner of the vehicle.
The inquirer advises that D has unexpectedly admitted that the accident occurred when he deviated from his ordinary delivery route to pay a personal financial obligation. Should this be known to the court, the inquirer believes that the court may declare that the accident occurred while D acted outside of the course and scope of his employment, thereby relieving E of vicarious liability for D's alleged negligent acts. Given this potential defense on behalf of E, combined with the inquirer's belief that the plaintiff's claims against D and the vehicle owner are time-barred, the inquirer poses the following question: Under Pennsylvania Rule of Professional Conduct 1.7 (the "Rules"), can he ethically obtain a waiver, based on informed consent (see Rule 1.0 (e)), from D of the concurrent conflict of interest that exists between D's and E's interests? The inquirer posits that such a waiver would allow the inquirer to present a potential absolute defense in favor of all parties. Specifically, disclosing the nature of D's errand at the time of the accident, would facilitate a successful defense on behalf of E. Furthermore, since the inquirer believes that D and the vehicle owner are not liable because the statute of limitations has run, all of the clients would thus be relieved of liability in the matter. The inquirer indicates that although he cannot conclude with absolute certainty that disclosure of D's confidential admission would not potentially expose him to some future detriment, that he, the inquirer, has reasonably concluded that it does not.
Rule 1.7, Conflict of Interest: Current Clients, provides that
(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.
The Rule's Comment  entitled "Special Considerations in Common Representation," provides some helpful guidance as to how the inquirer should proceed. The comment provides in part that,
"In considering whether to represent multiple clients in the same matter, a lawyer must keep in mind that if the common representation fails because potentially adverse interests cannot be reconciled, the result can be additional cost, embarrassment and recrimination. Ordinarily, the lawyer will be forced to withdraw from representing all of the clients if the common representation fails--."
The Committee believes that the situation as described in the inquiry has conflicts that can not be waived. Specifically, the inquirer believes that the common representation will not fail because all of his clients will be relieved of liability. However, as the inquirer concedes in his inquiry, that cannot be guaranteed. For example, the court might not rule that the plaintiff's claims are time-barred as to D and/or the vehicle owner. There are also other ways that D could be disadvantaged by disclosure of his confidential information. It is quite possible that E could decide to terminate D's employment upon learning of D's actions at the time the accident occurred. This circumstance might also make it difficult for D to obtain future employment as well. The Committee believes that if this dismissal doesn't occur and the employer intends to put on the "scope of employment defense" then E and D will be in a conflict, which cannot be waived under Rule 1.7
Comment , in continuing to address the common representation scenario provides that, "--continued common representation will almost certainly be inadequate if one client asks the lawyer not to disclose to the other client information relevant to the common representation. The lawyer has an equal duty of loyalty to each client, and each client has the right to be informed of anything bearing on the representation that might affect that client's interests. The client has the right to expect that the lawyer will use that information to that client's benefit--"
Given these considerations, the Committee finds that under the circumstances the inquirer cannot continue to represent both E and D.
In addition, the Committee finds that even if the inquirer withdraws from E's representation, he cannot continue to represent D. Rule 1.7's Comment  points out that, "--each client in the common representation has the right to-- the protection of Rule 1.9 concerning the obligations to a former client." Rule 1.9 (a) provides that an attorney can not represent a client in the same or a substantially related matter in which that client's interests are materially adverse to the interests of a former client unless the former client gives informed consent. " Here the former client would be E, and E is unable to provide informed consent because the inquirer is not free to disclose all the relevant facts to him.
The Committee concludes therefore, that the inquirer must withdraw from this matter entirely, and advise the insurance carrier that it must retain separate counsel to represent E and D. Obviously the inquirer would also have to withdraw from the representation of the owner of the vehicle. The Committee does not have sufficient information regarding the nature of the agreement between the owner and E to determine whether or not new counsel could represent them both.
The Committee cautions, that as provided in Rule 1.7's Comment , an attorney, before undertaking a representation of multiple clients, should, at the outset of the representation and as part of the process of obtaining each client's informed consent, advise each client that information will be shared and that the lawyer will have to withdraw if one client decides that some matter material to the representation should be kept from the other.