New Hampshire: Lawyer Suspended Due to Conflicts of Interest

Facts: In this case the respondent, Donald L. Wyatt, Jr. is an attorney licensed to practice in New Hampshire. The Supreme Court Professional Conduct Committee filed a petition to have Wyatt disbarred. Wyatt was hired by David Stacy to serve as his personal counsel. David was a full-time employee of his mother and held her general power of attorney. Wyatt’s firm drafted a general power of attorney for Michel Brault to manage David’s affairs. Brault was a personal friend of Wyatt and the chief executive officer of former corporate client of Wyatt’s firm. In 2001, David’s mother “dismissed” David and cut off his support. Wyatt represented David in negotiations with his mother in order to get financial support from her.

A contract was agreed to in May of 2001 in which they agreed to set up mutual general releases. The agreement included, amongst other things, creating and funding of various trusts for David. It also stipulated that David file a petition for “voluntary conservatorship” requesting Brault to act as the conservator. The contract would terminate if, among other things, David terminated the conservatorship or dismissed Brault as conservator without cause. Wyatt explained the document in full. He gave him definitions and explained how David could opt out of the agreement and that this action could negate his mother’s financial obligations.

David asked Wyatt to continue as his personal attorney as well as representing his “conservatorship estate.” Wyatt explained that the conservator would decide if and when someone would serve as counsel. Wyatt did not discuss conflicts of interest. Wyatt explained and felt that David understood that Brault would be in charge of conservator issues and would have the final say if there were a disagreement between David and Brault.

The conservatorship was granted in June of 2001 and Brault was named conservator. Brault then asked Wyatt to represent the “Estate of David E. Stacy.” Wyatt advised Brault on the conservatorship and that Brault could not make personal choices for David.

Wyatt continued advising Brault and David about both personal and business matters concerning the conservatorship.

When there were complications concerning abdominal surgery that brought up possible mental health issues, Wyatt became concerned. Wyatt advised Brault and his wife Svetlana to ask for a limited guardianship in regards to medical issues. Even though Wyatt told them they should get another attorney for this issue, which they did, Wyatt continued giving them legal advice in pursuit of guardianship.

Throughout all of the issues with David and with Brault and Svetlana petitioning for conservatorship, all expenses, even the ones for Wyatt, were being billed to the conservatorship estate. This includes even when Brault and Svetlana had their own attorneys in both New Hampshire and Texas where the hospitalization of David took place.

Once the guardianship was granted, an attorney was appointed for David. Wyatt gave all materials and information about David to the attorney. The attorney met with David on April 24th. After that time Wyatt had nothing to do with David concerning the guardianship. David told his attorney that he was no longer happy with Wyatt and did not want him to represent him any more.

In spite of several more years and court dates dealing with these matters, Wyatt was still present and giving advice. Brault resigned from being David’s conservator. Finally, David’s sister, Deborah, filed to be David’s legal guardian. Deborah then filed a sworn statement in May of 2003 alleging professional misconduct on the part of Wyatt.

Issues: Did Wyatt violate the New Hampshire Rules of Professional Conduct 1.7 and 1.9, by representing two people at the same time concerning the same matter (conflict of interest)?

Was Wyatt charging illegal fees for services in violation of New Hampshire Rules of Professional Conduct 1.5?

Rule of Law: The New Hampshire Rules of Professional Conduct 1.7 states that a lawyer cannot represent a client if that relationship will “adversely affect” the relationship with the other client unless the client agrees to the relationship after being given all the information and possible consequences. Also, if the representation of the client would be “materially limited” by the case with the other client this would breach Rule 1.7 (b).

In Rule 1.9 Wyatt could not represent another person in the same matter as he represented the first person. In this case Wyatt represented David and the Brault in the guardianship matters.

Rule 1.5 has to do with charging illegal fees. The court contends that since Wyatt charged these fees while he was in violation of Rules 1.7 and 1.9 they were illegal.

Holding: The court held that Wyatt was indeed in violation of Rules 1.7, 1.9, and 1.5. There was a conflict of interest based on representing two people from the same case at the same time. Also, he also represented one client (Brault) once he no longer represented the other client (David). This is a conflict of interest because they are parties of the same case. They also said that Wyatt was charging fees at a time when he was in violation of Rules 1.7 and 1.9. The court held that Wyatt should have known or did know of the conflict of issue since at least twice two separate attorneys brought it to his attention.

The appropriate sanction for this case was held to be a two year suspension. One of the reasons was because there was no evidence of Wyatt not always working in the best interest of David.