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117 N.J.L.J. 438
April 3, 1986
ADVISORY COMMITTEE ON PROFESSIONAL ETHICS
Appointed by the Supreme Court of New Jersey
Attorney-Client Confidentiality -
Disclosure of Insurance Fraud
This inquiry once again seeks an opinion relating to the
powerful policy requiring an attorney scrupulously to guard the
confidences and secrets of his client as presently set forth in RPC
1.6 (formerly DR 4-101).
RPC 1.6(b) and (c) recognize, as did our prior opinions, that
there are limited situations which, under subsection (b), require
a lawyer to reveal such information and other situations in which,
under subsection (c), the lawyer is authorized to reveal such
information to the proper authorities.
The facts of the instant inquiry fall within the exception to
the general rule authorizing the inquirer to make the disclosure.
In this inquiry, an attorney was separately retained by both
the Driver and a purported Passenger of a motor vehicle involved in
an accident - to recover damages for injuries sustained therein.
During the course of such representation, the attorney processed
payments of medical bills of both driver and passenger by
forwarding these bills to Driver's PIP insurance carrier. He also
completed PIP applications for both Driver and Passenger. Driver's
carrier, as a consequence, paid roughly $4,000 on account of
Subsequently, during an interview to explore the facts
underlying the latent or actual conflict between the attorney's
representation of both Driver and Passenger, the Driver revealed to
the attorney that Passenger had not been a passenger in Driver's
vehicle at the time of the accident but that the Passenger's
injuries for which the attorney had obtained payment had been
caused in a prior accident not involving Driver. Driver further
stated that Driver had misrepresented to Driver's PIP carrier that
Passenger had been a passenger in Driver's motor vehicle at the
time of the accident. The truth of the Driver's statement was
further confirmed to the attorney by the fact that Driver and Pas
senger had given the attorney "completely different" versions of
the occurrence in question in separate interviews by the attorney.
The attorney has since advised Passenger that the attorney may
no longer represent Passenger and will advise Driver to the same
effect. These actions are entirely appropriate.
The circumstances of this inquiry, therefore, fall within the
ambit of RPC 1.6(c)(1).
A lawyer may reveal such information [a client's
confidences and secrets] to the extent that the lawyer
reasonably believes necessary; (i) to rectify the
consequences of the clients criminal, illegal, or
fraudulent act in the furtherance of which the lawyer's
services have been used...
Clearly, the attorney's services have been used to defraud
Driver's PIP Carrier. Disclosure is warranted under the rule.
An appropriate forum for such disclosure would be before the
assignment judge of the county in which the actions were, or are to
be commenced. It should be done upon notice to inquirer's
adversary, the attorney for the Driver's PIP carrier and the former
clients, or their new attorneys if they have been retained.
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