The Florida Bar
PROFESSIONAL ETHICS OF THE FLORIDA BAR
July 12, 1968
July 12, 1968
The fact that an attorney representing a corporation in litigation received a portion of the cost deposit from a certain stockholder does not preclude his thereafter joining such stockholder as a defendant in the suit, provided the attorney received no information pertaining to the suit from the stockholder in question.
Chairman MacDonald stated the opinion of the committee:
A member of The Florida Bar advises as follows:
I filed a suit on behalf of a corporation which had three stockholders. One of the stockholders was my brother. He requested that I file suit on behalf of the corporation against one of the three stockholders who was managing the corporate affairs for alleged conversion of corporate assets. I told him that I would need $100 for a cost deposit. He contacted the third stockholder about the cost money and got half of the cost deposit from him. I then forwarded to this stockholder a receipt for the $50 that he had delivered to my brother as a portion of the suit costs. Shortly thereafter I filed suit on behalf of the corporation against the managing stockholder and his wife. After the institution of the suit I had occasion to advise my brother and the other interested stockholder concerning the matters involved in the suit. It later developed that the interested stockholder and the managing stock- holder were acting in concert in converting the corporate assets. As this point it is, of course, indicated that the interested stockholder should be joined as a party defendant. My question is whether or not I can ethically carry this suit forward on behalf of the corporation by joining the interested stockholder notwithstanding the fact that he posted one half of the original cost deposit.”
Although it is not completely clear to us the legal basis on which the suit on behalf of the corporation may be prosecuted when the apparent majority of the stockholders are adverse parties, we assume for purposes of this inquiry that there is a lawful and appropriate basis for the inquirer to continue to represent the corporation. Emphasizing as we must that the inquirer received no information pertaining to the suit from the stockholder who is now to be joined as a defendant, and assuming that the $50 contributed by him to the original cost deposit was treated by the parties as an advance on behalf of the corporation, the Committee, three members dissenting, concludes that it would not be unethical for the inquirer to continue the prosecution of the suit in the circumstances related.