The Florida Bar

Ethics Opinion

Opinion 61-23

November 8, 1961
Advisory ethics opinions are not binding.
It is not improper for an attorney, who has been retained by a subdivision enterprise to handle
transactions in connection with acquiring loans and mortgages, to represent the bank in
foreclosure suits thereon against the subdividing enterprise when the lawyer has not represented
the subdivision for some time and gained no knowledge from the representation which would be
advantageous to the defense of such suits.


Chairman Holcomb stated the opinion of the committee:
The Committee on Professional Ethics of The Florida Bar, upon request, has
considered the matter presented to us by a member of The Florida Bar wherein he
states that he is the local attorney for an approved FHA mortgage company which
requires that he personally handle all closings on their loans, and that he closed
about thirty of these loans in connection with a certain subdivision, which
required the payment by such subdivision of all closing costs. He received the
funds resulting from the loans and disbursed them, paying off various
encumbrances and distributing the balance. The subdivision borrowed several
large amounts of money on construction loans on the lands on which these FHA
commitments were issued, which loans were made through local national banks,
which required that the attorney for the FHA mortgage company issue title
insurance; and with the approval of the subdivision he drew the construction
mortgages, examined the titles and delivered to the bank the papers required. The
subdivision paid his fees and the bank’s charges and all expenses. The
construction mortgages to the banks are now in default, and the banks are
proceeding to foreclosure and are requesting that he handle the foreclosure suits
for them.
The member desires our opinion as to whether he may handle the
foreclosures of the mortgages which he originally placed on record without
running into a conflict of interests. He states that he has not recently represented
the subdivision and that the former officers and directors of the corporation with
whom he dealt have informed him that they are no longer with the company and
that he does not know any of the principals of the company or their present
locations, and that he does not have any information or knowledge that would be
advantageous to the defense of the suits to foreclose the construction mortgages.
With the understanding that he no longer represents the subdivision, we do not believe
that this prior representation of the subdivision would bar or prohibit him from representing the
banks in the foreclosure of the mortgages. However, if his representation were of a recent or of a

continuing nature, our opinion would be to the contrary. Under the circumstances, we find no
objection to his representing the banks in the foreclosure of the mortgages.