726 A.2d 924 (N.J. 1999)
In October 1997, the husband and wife retained Hill Wallack, a firm of approximately sixty lawyers, to assist them with planning their estates.1 On the commencement of the joint representation, the husband and wife each signed a letter captioned "Waiver of Conflict of Interest" explaining possible conflicts and that information provided by one spouse could become available to the other.2
In January 1998, before the husband and wife executed the estate planning documents, the mother coincidentally retained Hill Wallack to pursue a paternity claim against the husband.3 A clerical error had caused the firm's computer check to misspell the clients' surname in the estate planning file, so the conflict search using the correctly spelled name did not reveal the joint representation.4
The husband did not object to the firm's representation of the mother or alert the firm to the conflict.5 Instead, he retained Fox Rothschild to represent him in the paternity action.6 After initially denying paternity, he agreed to voluntary DNA testing, which revealed that he is the father.7 Negotiations over child support failed. The mother instituted the present action.8 After the mother filed the paternity action, the husband and wife executed their wills at the Hill Wallack office.9 The parties agree that in their wills, the husband and wife leave their respective residuary estates to each other.10 If the other spouse does not survive, the contingent beneficiaries are the testator's issue.11
Upon learning of the conflict when Fox Rothschild informed the firm that it already possessed the requested information about the husband's assets, Hill Wallack withdrew from representing the mother in the paternity action.12 The firm then wrote to the husband stating that it believed it had an ethical obligation to disclose to the wife the existence, but not the identity, of his illegitimate child.13 The husband joined the firm as a third-party defendant in the paternity action and requested restraints against disclosure.14 The Family Part denied the requested restraints.15 The Appellate Division reversed and remanded for the entry of an order imposing preliminary restraints.16 Hill Wallack filed motions in the Supreme Court seeking leave to appeal, which the Court granted, accelerating the appeal and remanding the matter to the Family Part.17
Whether a law firm may disclose confidential information of one co-client to another co-client?18
A lawyer's duty of confidentiality under RPC 1.6(a) generally prohibits revealing information relating to representation of a client unless the client consents after consultation.19 RPC 1.6(c) permits a lawyer to reveal confidential information to the extent the lawyer reasonably believes necessary to rectify the consequences of a client's criminal, illegal or fraudulent act in furtherance of which the lawyer's services had been used.20 The term fraudulent act receives a broad construction in this context.21 When co-clients have signed a waiver of conflict of interest acknowledging that information provided by one could become available to the other, disclosure may be authorized if one client has concealed material information affecting the other's estate plan. Persuasive authority from the Restatement (Third) of The Law Governing Lawyers supports leaving the resolution of such competing duties to the lawyer's reasonable discretion after weighing the immediacy and magnitude of the risk to the affected co-client against the communicating client's interest in continued secrecy.22
Yes. The husband's deliberate omission of the existence of his illegitimate child constitutes a fraud on his wife.23 When discussing their respective estates with the firm, the husband and wife reasonably could expect that each would disclose information material to the distribution of their estates, including the existence of children who are contingent residuary beneficiaries.24 The husband breached that duty.
Under the reciprocal wills, the existence of the husband's illegitimate child could affect the distribution of the wife's estate if she predeceased him.25 Additionally, the husband's child support payments and other financial responsibilities owed to the illegitimate child could deplete that part of his estate that otherwise would pass to his wife.26 The law firm learned of the husband's child through its representation of the mother in her paternity action against the husband, not from a confidential communication from the husband himself.27 The husband and wife signed letters captioned Waiver of Conflict of Interest acknowledging that information provided by one client could become available to the other.28 The spirit of those letters supports disclosure.29 Therefore, Hill Wallack may inform the wife of the existence of the husband's illegitimate child.30
The law firm may disclose to the wife the existence, but not the identity, of the husband's illegitimate child.31