By Robert K. Sall

Sall is a Certified Specialist in Legal Malpractice Law by the State Bar of California Board of Legal Specialization and Of Counsel to Sall Spencer Callas & Krueger in Laguna Beach. He is a member of LACBA’s Professional Responsibility and Ethics Committee. The views and opinions expressed in this publication are solely those of the author.

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Clients retain lawyers to obtain legal advice in all sorts of circumstances. Giving legal advice is one of a lawyer’s primary functions, but how far does that duty extend? Rule 1.4 (Communication with Clients) of the California Rules of Professional Conduct (“CRPC”) mandates that lawyers must reasonably consult with the client about the means by which to accomplish the client’s objectives in the representation and keep the client reasonably informed about significant developments related to the representation.

Sometimes a client will ask questions pertaining to a field in which the lawyer does not practice, or which the lawyer believes is not within the scope of their representation. What are a lawyer’s responsibilities in these situations? Duty in many of these cases depends upon the foreseeability of harm, and whether the attorney is better qualified than the client to recognize the risk of a particular course of action or inaction.

Many malpractice claims have been based upon failure to give proper advice. See, for example, Miller v. Metzinger 91 Cal. App. 3d 31 (1979) (claim based upon alleged failure to advise of impending statute of limitations), Meighan v. Shore 34 Cal. App. 4th 1025 (1995) (claim arising out of failure to advise client’s wife of the existence of claim for loss of consortium); Bucquet v. Livingston 57 Cal. App. 3d 914, (1976) (claim based upon lawyer’s alleged failure to advise client trustor of potential tax consequences of a general power of appointment); Osornio v. Weingarten 124 Cal. App. 4th 304, 313 (2004) (claim based upon failure to advise testator client of a beneficiary’s presumptive disqualification because of her caregiver status, and the available steps to avoid it).

Under Rule 1.2(b) of the CRPC, a lawyer may limit the scope of representation if the limitation is reasonable under the circumstances, is not otherwise prohibited by law, and the client provides informed consent. The terms “reasonable” and “informed consent” are defined in rule 1.0.1 (Terminology) and should be reviewed before crafting a limited scope representation or the required disclosure. Informed consent requires the client’s agreement to a proposed course of conduct after the lawyer has communicated and explained the relevant circumstances and the material risks, including any actual and reasonably foreseeable adverse consequences of the proposed action. While written disclosure may not be strictly required in this instance, it is certainly the more effective way to communicate a matter of significance. Many disclosures required in the CRPC require informed written consent, in which case, the disclosure is required to be in writing. Rule 1.0.1(e-1) of the CRPC.

The duty to advise the client often goes beyond merely responding to the client’s requests for advice. In the bankruptcy context it includes the duty of counsel to advise the debtor-in-possession and its principals of their legal duties to the estate, beneficiaries, and unsecured creditors under the Bankruptcy Code.) In re Wilde Horse Enterprises, Inc., 136 B.R. 830 (Bankr. C.D. CA., 2001) (fees denied entirely for lawyer’s neglect of fiduciary duties and failure to advise).

While scope of representation is important in the analysis of the lawyer’s duty to advise, a limited scope representation does not always excuse the professional obligation to render advice. “[E]ven where the retention is expressly limited, the attorney may still have a duty to alert the client to legal problems which are reasonably apparent, even though they fall outside the scope of representation.” Nichols v. Keller, 15 Cal. App. 4th 1672, 1684-1685 (1993).

Where the question of advice is involved in a legal malpractice claim, “the crucial issue is whether the attorney’s advice and actions were so legally deficient when given that it demonstrates a failure to use such skill, prudence, and diligence as lawyers of ordinary skill and capacity commonly possess and exercise in performing the tasks they undertake.” Unigard Insurance Group v. O’Flaherty & Belgum, 38 Cal. App. 4th 1229, 1237 (1995) (Emphasis added). In other words, would an attorney of ordinary skill and capacity in like circumstances have given the advice that was not provided the client in the instant situation?

In Nichols, an attorney was engaged to prosecute a worker’s compensation claim and associated with a second attorney to do the work to prosecute the claim. Neither attorney informed the client that he might have a claim against a third party – the manufacturer of equipment that caused the client’s injury – nor was the client advised that there would be an applicable statute of limitations for a third-party claim. After learning that the statute expired on that claim, the client sued the worker’s compensation attorneys for legal malpractice and negligent spoliation of evidence. The defendant who was associated to prosecute the worker’s comp claim asserted that he only undertook limited duties and owed no duty to advise the client about possible third-party claims. The appellate court, however, in what has become California’s leading opinion on the duty to advise, found that foreseeability of harm compelled a finding of duty in that case. In holding that summary judgment should not have been granted, the court stated that as between the lay client and the attorney, the attorney is more qualified to recognize the issue and analyze the client’s needs. Id. at 1684. Even though the attorney is not obligated to prosecute the third-party claim, he should inform the client of the limitation upon his representation and the possible need for other counsel. “Not only should an attorney furnish advice when requested, but he or she should also volunteer opinions when necessary to further the client’s objectives. The attorney need not advise and caution of every possible alternative, but only of those that may result in adverse consequences if not considered.” Nichols, at 1684-1685.

As a general rule, by accepting employment to give legal advice or render other services, the attorney impliedly agrees to use that level of skill, prudence, and diligence as other lawyers of ordinary skill and capacity commonly possess and would exercise in the performance of their tasks. Kirsch v. Duryea, 21 Cal. 3d 303, 308 (1978). A good question to ask yourself is what would another reasonable attorney advise the client in like circumstances? The failure to fully inform the client may give rise to liability. Considine Company, Inc. v. Shadle, Hunt & Hagar, 187 Cal. App. 3d 760, 765 (“The standard of care may be breached where the attorney fails to fully inform a client about his or her rights and the alternatives available under the circumstances.”)

Think about some simple scenarios. If the client is starting a business, should the attorney advise the client to file and publish its fictitious name statement? What if the business has a slogan or catchy name? Should the lawyer advise the client to file for trademark protection? If the lawyer does not work in the field, should the lawyer advise the client that protecting intellectual property is important and the client should consult with an attorney who does practice in that field? From the liability perspective, the lawyer is usually more qualified to know of these risks and the procedures to avoid them. Prudence dictates advising the client, even if it is outside the scope of your engagement.

Clients come to us not just for transactional services and litigation, but also for guidance – legal advice – and the consideration of available options. Assuming that harm to a client is reasonably foreseeable an attorney undertaking representation may have broad duties to advise and warn clients about anything that may impair that client’s rights or foreclose important options. Performing to the level that other lawyers of ordinary skill would do in the same circumstances is part of our professional standard of care. Providing competent advice, however, is not merely required by the standard of care. It is ethically required as part of our duty to communicate. As always, let us be careful out there.