11-02.

• Case Date: April 12, 2011
• Court: Kansas

Kansas Ethics Opinions 2011. 11-02. KBA Legal Ethics Opinion No. 11-02April 12, 2011TOPIC: Ethical propriety of requiring or requesting a plaintiff's lawyer to indemnify the defendant for plaintiff's breach of a settlement agreement. DIGEST: Because it would be ethically improper for a lawyer to agree to indemnify another party against his client's breach of a settlement agreement, it is also ethically improper for another lawyer to request or require such an indemnity from another lawyer. Date of Request: March 10, 2011. REFERENCES: Rules 1.7(b)(conflicts of interest); 1.8(e)(no financial assistance to client); 1.3 (zealous advocacy); and 8.4(a)(not violate rules or assist or induce another to do so). FACTS: Counsel has been requested to sign a settlement agreement in a personal injury case which includes a provision by which counsel agrees, personally, to indemnify and hold harmless the insurance company and its insured from payment of any liens arising out of the settled incident. Counsel questions the ethical propriety of agreeing to such an indemnity and the ethical propriety of requesting it. QUESTION: (a) Is it a violation of the Kansas Rules of Professional Conduct(fn1) for a lawyer to make an agreement by which the lawyer agrees to indemnify a third person for losses or claims arising from the client's breach of a settlement agreement? This question has previously been addressed under Rules 1.7(b) and 1.8(e), and answered by this Committee in KBA Ethics Opinion 01-5. That opinion is hereby re-confirmed, and holds:

A lawyer for a personal injury plaintiff or claimant signing a blanket indemnification provision whereby the lawyer agrees to hold the insurance company and the insured harmless from "any and all subrogation liens of every kind and nature whatsoever, both known and unknown" places the lawyer in a position where he or she creates a conflict of interest between the client and the insurance company and insured, and/or the lawyer's own interests.

(b) Is it a violation of the Kansas Rules of Professional Conduct for a lawyer to request another lawyer to make an agreement by which the other lawyer agrees to indemnify a third person for losses or claims arising from the client's breach of a settlement agreement? ANALYSIS: Lawyers clearly owe duties of loyalty, diligence and zeal to their clients. Rule 1.3...