Looking To Be Sued?

Making a special appearance for a colleague has the potential to embroil you in a malpractice suit.

Sorry to be the bearer of bad news but making a “special appearance” for another attorney creates an attorney client relationship between you and the debtor.  This is the rule in California anyway, found in Streit v. Covington & Crewe, 82 Cal. App. 4th 441 (2000).  Check the law of your state for a comparable case.

The Streit case overturned a judgment in favor of the attorney making the special appearance and remanded the case to the trial court to determine what the scope of the duty the appearance attorney had to the client and the details of the engagement between the two law firms.

Even if the ultimate ruling was in favor of the attorney, the exercise cannot have been fun.  Another manifestation of the bromide that no good deed goes unpunished.

This issue confronted a friend of mine handling a 341 appearance for a colleague.  A review of the file suggested that the debtors could have filed a Chapter 13 and stripped off the lien on a house they said they intended to keep.  The file provided my friend was devoid of any record of discussions with the client on the subject.  What is the obligation of an attorney appearing as a courtesy to another to explore the work product of counsel of record?  Do you raise questions in the client’s mind about the quality of the representation?  Do you take it up with counsel of record?

The later was my suggestion:  get on the phone after the meeting and find out more about the options presented to the clients.  Send a confirming letter to counsel memorializing the conversation.

It turned out, in this case, that the clients had been properly advised and had made a knowing choice of chapter.  Panic averted.

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  1. Allan Cory says

    Date of this case makes me wonder if “limited scope” services were then acceptable. One potential shield to this kind of exposure may be such an agreement with client stating that appearance does not expand into providing advice on underlying case.