Under the Texas Disciplinary Rules of Professional Conduct, may a lawyer retained by an insurance company notify the insurance company that the insured client he was assigned to represent is not cooperating in the defense of the client’s lawsuit?
Plaintiff sued Defendant in state court for personal injury damages arising out of an automobile accident. Defendant’s insurance company (“Company”) assigned Defendant’s case to a Texas lawyer (“Lawyer”). Lawyer met with Defendant, explained that Company retained him to represent Defendant, explained Defendant’s responsibilities in defending the lawsuit, notified Defendant he would be keeping the Company apprised of the status of the lawsuit, and obtained Defendant’s informed consent to the representation.
Defendant initially cooperated in defending the lawsuit. Later, however, Defendant stopped communicating with Lawyer. Lawyer tried contacting Defendant by various methods. Lawyer eventually hired an investigator, who spoke with Defendant and asked him to contact Lawyer. Defendant did not do so.
Lawyer is concerned about Defendant’s failure to communicate with him, which makes the lawsuit difficult (if not impossible) to defend and may result in the imposition of sanctions for Defendant’s failure to comply with outstanding discovery requests. Lawyer also realizes that Defendant’s failure to communicate may violate the cooperation provision of Defendant’s insurance policy and thus result in Company’s withdrawing coverage.
Lawyer’s investigator delivered a letter to Defendant, informing Defendant that if he did not contact Lawyer, Lawyer would file a motion to withdraw. Lawyer received no response from Defendant. Lawyer therefore plans to withdraw under Rule 10 of the Texas Rules of Civil Procedure. Lawyer is concerned about what he may disclose to Company regarding his reasons for withdrawing.
Tex. Comm. On Professional Ethics, Op. 669 (2018)