Traditionally, the attorney-client relationship requires an express agreement between the attorney and client. However, an attorney-client relationship may be inferred or implied from the “totality of the circumstances,” including a course of conduct, communications between the parties, and a putative client’s reasonable expectations. Therefore, when an attorney deals with a non-represented party, an attorney-client relationship can arise without the attorney’s knowledge, intent, or consent. In those circumstances, the attorney often is not representing the interests of that party, and very well may be taking actions that are contrary tothat party’s interests. Such situations are rife with legal-malpractice exposure.
The risk of developing an unintended attorney-client relationship occurs most frequently in transactional matters, where one party has counsel and the other does not. The other party may believe he or she does not need counsel because his or her interests are similarly aligned. Other risk factors include circumstances where a non-client will derive benefits from the contemplated transaction, such as working-interest owners or joint-venture partners. Likewise, unintended attorney-client relationships can arise when there is a lack of clarity concerning whether the attorney represents an entity or its managers or constituents.
Any doubt concerning the existence of an attorney-client relationship will likely be resolved in favor of the putative client. Defending such matters can be particularly difficult, because if the jury finds an attorney-client relationship, the attorney then, by definition, was acting with a conflict of interest—by preferring the interests of one client over another. Jurors are often incensed by attorneys who act with a conflict of interest, and in some cases, have significantly inflated damage awards due to their outrage.