The Florida Bar

November 9, 1965

A claimant's attorney in a litigated worker's compensation matter, in which an insurance carrier is a direct party, may communicate directly with the carrier's claims representatives only if the carrier's attorney knows of and permits the direct dealings.

Canons: 9, 47
Opinions: 63-19, ABA Informal C-523

Chairman Kittleson stated the opinion of the committee:

A member of The Florida Bar has requested the Committee's advice on the subject discussed below. Basically, the question is whether or not a claimant's attorney in a litigated workmen's compensation matter may properly communicate and deal directly with the insurance carrier's claims personnel and adjusters, thus by-passing the attorney who represents the carrier in the litigation. He indicates that, in his area, many claimant's attorneys believe that such direct communications are efficient and reasonable, because the claimant's attorneys have usually negotiated with the carrier's claims personnel before the carrier's attorney entered the picture. He points out that this practice of direct communication has become common in the area and that occasionally it is initiated by the carrier's own adjusters or claims representatives.

Canon 9, entitled Negotiations with Opposite Party, is pertinent. It provides, in part:

A lawyer should not in any way communicate upon the subject of controversy with a party represented by counsel; much less should he undertake to negotiate or compromise the matter with him, but should deal only with his counsel . . . .

The American Bar Association Committee on Professional Ethics has said that a plaintiff's attorney may not properly communicate directly with lay adjusters of the defendant's insurance company while suit is pending without the specific consent and approval of the insurance company's attorney. ABA Informal Opinion C-523.

In 1963, the Florida Committee's advice was requested by a lawyer whose client or prospective client, an insurance carrier, insisted on reserving the right to conduct settlement negotiations directly with the claimant or claimant's attorney at any time prior to actual trial. The Committee advised that the attorney could ethically acquiesce in the carrier's restriction on his employment (although he could, of course, refuse to accept the restriction for reasons other than professional ethics, if he chose to do so). Florida Opinion 63-19 [since withdrawn]. The Committee was influenced by the proposition that a client may settle his own case. The question did not involve an unfair attempt by a client to circumvent his attorney and jeopardize the attorney's contingent fee interest in a settlement. Nor did the question involve the absence of consent by the attorney; on the contrary, he was being requested to agree in advance that his client would retain the right to settle directly with the other
party. Nor did the question involve circumvention of the claimant's attorney. And the Committee did not advise whether or not settlement negotiations by non-lawyer representatives of the carrier, after suit is filed, constitute the unauthorized practice of law. The Committee may have been influenced also by the proposition that Canon 9 was probably designed primarily for the protection of the adverse party, not his lawyer, and that an insurance carrier, being in the business of making settlements, may not be subject to the same protective considerations that pertain to an inexperienced and vulnerable client. But even this proposition does not authorize a lawyer to by-pass the adverse party's lawyer without the lawyer's knowledge and

A majority of the present Committee hold that a claimant's attorney in a workmen's compensation matter, which is in litigation, and in which an insurance carrier is a party, may properly communicate and deal directly with the carrier's claims representatives, with a view to settlement, and by-passing the carrier's attorney of record in the litigation, but only if the carrier's attorney knows of and permits the direct dealings.

This opinion does not deal with (a) direct communications and negotiations that by-pass a claimant's attorney, or (b) questions of unauthorized practice of law by lay persons. If unauthorized practice results from settlement negotiations by an insurance carrier's non-lawyer representatives, then Canon 47 prohibits every lawyer from permitting his professional services to be used in aid of, or to make possible, the unauthorized practice. The Florida Bar has given another committee primary responsibility for advising upon unauthorized practice boundaries.

The Committee offers this caution to an attorney who is retained by an insurance carrier to represent an insured party in litigation. Even though employed and compensated by the carrier, the attorney has responsibility to protect and assert the insured's legal rights. An improperly handled settlement may impair the insured's ability to assert legal rights (for example, a counterclaim) otherwise available to him in connection with related matters. A non-lawyer adjuster may be more likely to overlook hazards to the insured's legal rights than would be the attorney. The attorney must be careful not to abdicate his professional obligations to the insured.

[Revised: 08-24-2011]