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Court Recognizes that Firm’s Privilege Protects Communications with Counsel About Malpractice Claim

May 2012
Practice: Professional Liability
People: Gary M. Ronan
In a recent decision, the Appellate Court of Illinois held that a law firm’s attorney-client privilege protects its communications with its own in-house and outside counsel related to a malpractice claim threatened by the firm’s former client, even though the communications took place while the law firm still represented the client.  The court’s decision reversed the trial judge’s ruling that the firm must produce the communications.  The case is Garvy v. Seyfarth Shaw LLP, 2012 IL App (1st) 110115.  The text of the decision is available at http://www.state.il.us/court/Opinions/AppellateCourt/2012/1stDistrict/1110115.pdf.

The law firm, Seyfarth Shaw, had advised the former client, Garvy, and his father in the clients’ effort to gain control of a closely-held family business.  When that effort spawned litigation among the family members, Garvy asked Seyfarth to represent him in the litigation.  Seyfarth agreed to do so, but only after sending Garvy a letter disclosing that potential conflicts of interest existed and that it was possible that Seyfarth might be made a party to or witness in the litigation, which could impede its ability to continue representing Garvy. 

Garvy also retained separate counsel, who, on his behalf, asserted legal malpractice claims against Seyfarth for Seyfarth’s work on the underlying matter.  In response, Seyfarth sought legal advice from its in-house general counsel and from outside counsel about Garvy’s malpractice claim.  At Garvy’s request, and despite Garvy’s assertion of the malpractice claim, Seyfarth continued to represent Garvy in the family litigation for some time before it withdrew from representing him further.  Garvy then filed a legal malpractice case against Seyfarth.

In the malpractice case, Garvy sought the production of Seyfarth’s internal and external communications related to its representation of Garvy, including communications related to Garvy’s legal malpractice claims against the firm.  Seyfarth took the position that its communications with counsel about the malpractice claims were protected by the firm’s attorney-client privilege, even though they took place when the firm still represented Garvy.  Garvy moved to compel the production of the communications.  The trial court ordered that they be produced, relying on the reasoning employed by courts in other states that had held that the fiduciary exception to the attorney-client privilege requires lawyers to turn over such communications.

The appellate court reversed, noting that Illinois has not adopted the fiduciary exception to the attorney-client privilege.  The court went on to say that the fiduciary exception, even if it had been adopted in Illinois, would not apply on the facts of the case because the communications at issue concerned Seyfarth seeking legal advice in connection with Garvy’s malpractice claims against the firm, and not in connection with the firm’s fiduciary capacity as Garvy’s counsel in the family litigation.  The court also rejected Garvy’s contention that Seyfarth could not establish that it had an expectation that its communications with counsel (especially, in-house counsel) would be confidential where they related to a current client to whom the firm owed a fiduciary duty.  In rejecting this contention, the court relied in part on Comment 9 to Illinois Rule of Professional Conduct 1.6(b)(4), which recognizes that a lawyer’s confidentiality obligations to his client do not preclude him from securing “confidential” legal advice about the lawyer’s personal responsibility to comply with the ethics rules.

This blog entry was originally posted on Legal OnRamp.  Goulston & Storrs attorneys provide blogs, discussion forums, collaboration, and pertinent news and related key cases regarding attorney-client privilege and work product protection information for Legal OnRamp.

This information should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer concerning your situation and any specific legal questions you may have.

Pursuant to IRS Circular 230, please be advised that, this communication is not intended to be, was not written to be and cannot be used by any taxpayer for the purpose of (i) avoiding penalties under U.S. federal tax law or (ii) promoting, marketing or recommending to another taxpayer any transaction or matter addressed herein.

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