FLORIDA BAR ETHICS OPINION
December 6, 1965
Advisory ethics opinions are not binding.
A lawyer employed by an insurance carrier to represent an insured defendant is subject to
potential conflict-of-interest situations that are sometimes difficult and delicate, and which call
for a high degree of tact and good faith. This is especially true when the defendant’s exposure
exceeds the insurance coverage. The lawyer would be obligated to inform the defendant of the
plaintiff’s offer to release the defendant from personal liability for an excess judgment in return
for an assignment of the defendant’s bad faith claim against his insurer.
6, 9, 28
Chairman Kittleson stated the opinion of the committee:
A member of The Florida Bar has requested the Committee’s advice on the
situation discussed below. A plaintiff in a personal injury action has recovered a
judgment in excess of the defendant’s insurance coverage. At the request of and
upon employment by the defendant’s insurer, the lawyer represented the
defendant in the litigation. The plaintiff’s attorney, seeking means to obtain more
in satisfaction of the judgment than the insurance policy limits, has proposed that
the plaintiff will release the defendant from all personal liability under the
judgment if the defendant will assign to the plaintiff whatever rights the defendant
may have against his insurer. The plaintiff’s attorney then proposes to assert that
the insurer could have settled the plaintiff’s claim before judgment for an amount
within the insurance policy limits, that the insurer failed to do so, that the failure
was not in good faith, and that, accordingly, the insured defendant has a cause of
action against his insurer. The plaintiff’s attorney has sent a letter to the
defendant’s attorney, with a copy to the defendant, proposing the release and
assignment. The letter expresses the writer’s belief that the defendant has a valid
claim against the insurer, and points out that, in such cases, the defendant’s
counsel will necessarily be faced with a conflict of interests between the
defendant, whom he represented, and the insurer, who actually employed him and
is responsible for his compensation. The letter suggests that the defendant should
obtain independent counsel. The Committee’s advice is sought whether or not the
plaintiff’s attorney violated professional ethics by sending the defendant a copy of
this letter. We assume, of course, that the defendant’s lawyer did not consent that
the plaintiff’s attorney could send the defendant a copy of the letter.
The pertinent Canons of Professional Ethics are Canon 9, “Negotiations With Opposite
Party,” and Canon 28, “Stirring Up Litigation, Directly or Through Agents.”
Under existing policies of the Board of Governors, the Committee is allowed to give
opinions only where the advice pertains to the conduct of the inquiring attorney himself. In other
words, the Committee is not authorized to advise the inquiring attorney on the propriety of a
third person’s conduct. Any person seeking advice that does not fall within this policy can direct
his request to the Board of Governors; if the Board considers the subject of general interest, it
may refer the question either to the standing committee on professional ethics or to a special
A majority of the Committee believes that the question presented here relates to a third
person’s conduct and, accordingly, that the Committee may not give its advice.
The Committee does recognize that any attorney who represents an insured defendant at
the request of and upon employment by the defendant’s insurance carrier is subject to potential
conflict-of-interest situations which are sometimes difficult and delicate, and which call for a
high degree of tact and good faith on the part of all attorneys involved. The attorney must be
always alert and sensitive to Canon 6, “Adverse Influences and Conflicting Interests.” Henry S.
Drinker, in his book, Legal Ethics (at pages 114 et. seq.), discusses the problem. A majority of
the Committee believes that, in the situation at hand, even if the plaintiff’s attorney had not sent
the defendant a copy of the letter, the defendant’s attorney would have been obligated to advise
the defendant of the plaintiff’s proposal and of the assertion that the defendant may have a claim
against his insurer, and to advise the defendant that he should obtain independent counsel on the
question. The lawyer would be unable to take an adversary position on either side.
The Committee in no way purports to advise upon any questions of law that affect the
assignment proposed by the plaintiff’s attorney.