Conflict of Interest Decision:
Shelby v. Blakes, No. 2014-03887, 2015 WL 3604439, (N.Y. App. Div. June 10, 2015), involved a fee dispute between lawyers where the incoming counsel alleged ethical violations against the outgoing counsel, specifically the failure to inform the client of a potential conflict of interest with one attorney representing the driver and a passenger in the same lawsuit. Here, the original attorney claimed there was no conflict as this was a classic "hit in the rear" scenario and the counterclaim against the driver was specious.
The Appellate Division rejected the argument stating "Borda contends that since Earl was a passenger in a stopped vehicle which was struck in the rear, the driver of the stopped vehicle was clearly not at fault, and there was no conflict of interest (see Sayyed v. Murray, 109 AD3d 464). However, once the defendant asserted a counterclaim, the pecuniary interests of the driver conflicted with those of the passenger (see Kyung Seong Kim v. Metropolitan Suburban Bus Auth., 2008 N.Y. Slip Op 30858[U] [Sup Ct N.Y. County]; see also Alcantara v. Mendez, 303 A.D.2d 337). Therefore, the appellant's motion to disqualify Borda from receiving a portion of the attorneys' fees should have been granted, and the cross motion for an allocation of attorney's fees should have been denied."
"The general rule is that an attorney is not entitled to a fee in a personal injury action if the attorney violated the Rules of Professional Conduct (12 NYCRR 1200.0) by representing both the driver of an automobile involved in a collision and a passenger in that vehicle (see Quinn v. Walsh, 18 AD3d 638; Pessoni v. Rabkin, 220 A.D.2d 732; see also Doviak v. Finkelstein & Partners, LLP, 90 AD3d 696, 699). Rule 1.7(a) of the Rules of Professional Conduct (22 NYCRR 1200.0) provides, in pertinent part, with respect to conflicts of interests involving current clients, that a lawyer shall not represent a client if a reasonable lawyer would conclude that "the representation will involve the lawyer in representing differing interests" (Rules of Professional Conduct [22 NYCRR 1200.0] rule 1.7[a] ). Pursuant to rule 1.7(b) of the Rules of Professional Conduct (22 NYCRR 1200.0) the potential conflict may be waived if the lawyer reasonably believes that he or she will be able to provide competent and diligent representation to each affected client, the representation is not prohibited by law, the representation does not involve the assertion of a claim by one client against the other in the same litigation, and each affected client gives informed consent, confirmed in writing."