September 1957

NEGOTIATIONS WITH OPPOSITE PARTY-- OFFERS TO SETTLE-—Where a suit for damages arising out of an automobile accident has been filed and the opposite party has answered through an attorney representing the insurance company, it is improper for the attorney employed by the plaintiff to write the opposite party suggesting that he can demand his insurance company to settle the case within his collision policy limits, and that should the company fail to settle, he can make it pay for any amount over the policy limits which the plaintiff may recover from him.

Canon 9.


In a damage suit arising out of a collision with a vehicle owned by Mr. Y, Attorney John Doe is representing Mr. X. Mr. Y has a "5 & 10" insurance policy. The suit filed by Mr. X against Mr. Y seeks more damages than is provided by the policy. After suit has been filed by Attorney John Doe, and after Mr. Y has filed an answer through an attorney representing the insurance company, Attorney John Doe writes Mr. Y, informing him that he can generally demand that Mr. Y's insurance company settle the case for the amount of the policy, and if they fail to make settlement, then Mr. Y can make the insurance company pay for the judgment against Mr. Y, over and above $5,000, if it is recovered in a lawsuit.

In the letter, Attorney John Doe offers to settle the case for the sum of $5,000, and invites Mr. Y to come by his office and talk to him about the matter, and he, Attorney John Doe, will tell Mr. Y about the law of the case, and advises Mr. Y that he can check with any other lawyer of his own choosing to find out whether or not he, Attorney John Doe, is telling the truth.

Under the above circumstances, is the writing of such a letter to Attorney John Doe a violation of Canon 6, Canon 9, or any other Canon of Ethics of the State Bar of Texas?


The committee is of the opinion that the writing of such a letter by Attorney John Doe to Y would be a violation of Canon 9 of the Canons of Ethics of the State Bar of Texas, which provides that a member should not in any way communicate upon the subject in controversy with a party represented by counsel and should not undertake to negotiate or compromise the matter with the party, but should deal only with the counsel. (8-1)