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                                         117 N.J.L.J. 244
                                        February 27, 1986


Appointed by the Supreme Court of New Jersey


Conflict of Interest -
Representation of Client and Clients's
Partner in Purchase of House, and of
Client in Subsequent Partition

    This Committee has been asked whether it is ethically proper for an attorney to represent Client A in an action for partition of property owned jointly by A and B and in an action to dissolve a partnership between A and B where the inquirer previously represented A and B in a joint purchase of the property. Although the inquirer did not prepare any of the papers in connection with that purchase, she did attend the closing as the attorney for both of them. Subsequently, the inquirer reviewed a lease for the A and B partnership with respect to rental of a craft booth at a mall and gave them legal advice concerning the terms and conditions of the lease. The inquirer has performed no legal services for either A or B since 1981.
    The present inquiry is governed by RPC l.9(a) which provides: "a lawyer who has represented a client in a matter shall not thereafter:
        (1)    represent another client in the same or a substantially related matter in which the client's interest are materially adverse to the interests of the former client unless the former client consents after a full disclosure of the circumstances and consultation with the former client; or

        (2)    use information relating to the representation to the disadvantage to the former client except as RPC 1.6 would permit with respect to a client or when the information has become generally known."

    RPC l.9(b) incorporates by reference the provisions of RPC 1.7(c) which states that the rule does not alter the effect of existing case law or ethics opinions with respect to the appearance of impropriety.
    While the inquirer represents that in her prior representation of A and B she obtained no information concerning the finances of either individual or the partnership, she did represent both parties at the closing on the purchase of the property and, therefore, would have reviewed all of the relevant financial documents and, most likely, have retained copies in her file on those clients. The inquirer's representation of former client A in a partition action, with respect to the property, would be a matter substantially related to the earlier acquisition in which she represented both A and B and, therefore, under the requirements of RPC 1.9(a)(1) the inquirer would, at a minimum, be required to fully disclose to former client B the request that the inquirer represent former client A and obtain former client B's consent.
    There are numerous ethics opinions, which, although not dealing with the specific set of facts presented by the inquirer, are sufficiently analogous and support the conclusion of the Committee. Opinion 205, 94 N.J.L.J. 451 (1971) dealt with whether an attorney may represent a client in an action against a former partner of the client when the attorney had previously represented a corporation wherein both men were principals in the corporation. The Committee concluded under the facts presented in that inquiry that there was a very definite possibility of a conflict of interest. The Committee quoted from In re Blatt, 42 N.J. 522, 524 (1964), the following: "There is always a possibility, however remote, that confidential information received from the original client may be used to his detriment."
    The Committee then said:
        We have stated many times that if there is the slightest doubt as to whether a proposed representation involves such a conflict of interest, or may encompass the use of special knowledge or information obtained through service of another client, or necessitates a possible conflict between the interests of a present or former client and those of the attorney, the doubt must be resolved by the attorney taking a definite stand that he cannot serve two masters. Opinion 205, supra.

    The inquirer cites, for the benefit of the Committee, language from Opinion 154, 92 N.J.L.J. 353 (1969). In that Opinion, the inquiry was presented as to whether an attorney could properly undertake a negligence action against an individual whom the attorney had formerly represented in an unrelated municipal court case. The Committee assumed for purposes of rendering the Opinion that the municipal court matter had been dismissed and that the parties and circumstances involved in the municipal court matter were entirely different from those which gave rise to the negligence matter. It is clear that Opinion 154, supra, is distinguishable from the facts presented by the inquirer since in the case presently before the Committee, the parties and to a large extent the circumstances involved in the present action are the same as those for which both parties were initially represented by the inquirer.
    While the Committee assumes, as represented by the inquirer, that the inquirer never received any confidential information about the personal finances of former client B nor about the finances of the partnership, there is, at a minimum, an appearance of impropriety and, without complete disclosure to former client B and B's approval of the inquirer's representation of former client A, such representation should not be undertaken.

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