What Counts as Aggregate

Representing two or more clients does not, by itself, bring Rule 1.8(g) into play. The rule restricts a lawyer’s participation in “an aggregate settlement of the claims of or against the clients” and, in a criminal case, in “an aggregated agreement as to guilty or nolo contendere pleas.”¹ The adjective is the trigger. Until a deal is aggregate, the signed-consent and disclosure requirements do not attach, and a lawyer who skips that threshold question will either miss a deal that needs the protections or burden one that does not.

The question to ask is whether one client’s outcome depends on the others’. In an aggregate deal, each client’s acceptance is tied to everyone else’s, so the package is taken by all or by none. That dependence is why the rule exists. When each client’s deal stands alone, the lawyer advises that client about that client’s own terms, and the other clients’ choices do not bear on the advice. When the deals are linked, every client decides about a package built with the others in view, and the lawyer must counsel all of them about the same proposal. A shared lawyer, a shared opponent, and a common set of facts describe joint representation, and none of them makes a settlement aggregate.²

Three settings follow: the civil settlement in which the opposing party proposes a single disposition of all the claims, the criminal plea package, and the arrangements the rule leaves alone.

Interdependent Civil Settlements

Rule 1.8(g) uses the word “aggregate” without defining it, so the definition comes from the situation the rule addresses.³ In civil litigation, an opposing party may offer a simultaneous and conclusive disposition of all the lawyer’s clients’ claims, which makes the resolution depend on agreement by every one of those clients. The offer is all-or-nothing. Refusal by any single client rejects the whole proposal, and the litigation continues for everyone, including the clients who favored settling.⁴ Commentary on the rule puts the point in one phrase: it is the “characteristics of interdependency which define an aggregate settlement.”⁵

Courts state the idea as a definition. Tilzer v. Davis, Bethune & Jones, L.L.C., a malpractice suit against a lawyer, quoted this definition of a non-class aggregate settlement: “a settlement of the claims of two or more individual claimants in which the resolution of the claims is interdependent.”⁶ The definition locates the test in the structure of the deal and not in the nature of the claims. Claimants may share a lawyer, a defendant, and an identical legal theory and still have their claims resolved separately, and commonality of factual or legal issues does not by itself implicate the rule. A settlement that is “individually negotiated and each client is free to settle or not as that client chooses” is not in the aggregate.⁷

Interdependence matters because of what the lawyer owes each client. A lawyer who represents several clients owes every one of them an equal duty of loyalty and must give each balanced and candid advice on whether to accept the proposal.⁸ That duty is easy to perform when a client’s choice binds only that client. An all-or-nothing offer changes things, because each client’s decision now fixes the fate of every other client’s claim, and the package may favor one client over another. Where it does, balanced counseling may be difficult or impossible. Advice that serves the client with the strong claim can cost the clients who need the money, and the reverse is equally true.

A stem that gives several claimants the same lawyer, the same defendant, and the same legal theory invites the conclusion that any settlement of their claims is aggregate. The shape of the offer decides the question.

Settlement by individual offer and separate resolution of some or all of a group of claims does not raise the same conflict concerns, because the lawyer can advise each client about that client’s own terms.⁹ The lawyer’s general duties to each client continue. The signed-consent and disclosure requirements of Rule 1.8(g) attach only when the clients’ outcomes are linked.

Missing information does not take a deal outside the rule. In Tilzer, a trial court reasoned that a global settlement was not aggregate because the information the rule requires a lawyer to disclose was not and could not have been known. The reviewing court disagreed and said that the lack of information would actually support a finding that the settlement was aggregate.¹⁰ The disclosure requirement explains why. Each client needs to know the existence and nature of the claims and each person’s participation in order to judge a package whose terms depend on other people’s outcomes. If no one can say what each person’s share will be, the clients are tied together in a deal whose division is invisible to them, which is the situation the disclosure duty exists to cure. Treating missing information as an escape would let a deal avoid regulation exactly when the clients knew the least.

Whatever form the offer takes, the lawyer may not hold back what the clients are entitled to know. The rule’s disclosure sentence reaches the participation of each person in the settlement,¹¹ so a lawyer may not decline to tell one client the nature or amount of the offer made to another.¹² The reason follows from interdependence. Because each client’s decision is bound to the others’, what the others are offered is part of what each client is deciding about.

Aggregated Criminal Pleas

Rule 1.8(g) reaches criminal practice through a clause that mirrors the civil one. A lawyer who represents two or more clients may not participate in making “an aggregated agreement as to guilty or nolo contendere pleas” unless each client gives informed consent in a writing signed by the client.¹⁴ The interdependence test carries over. In an aggregate resolution of a civil or criminal matter, the lawyer representing several parties faces the same conflict: the lawyer owes each client an equal duty of loyalty and must give each balanced and candid advice on the proposal, and that balance may be difficult or impossible when the interdependent proposal favors one client over another.¹⁵

In a plea setting, interdependence takes a familiar form. A prosecutor may offer jointly charged defendants an arrangement in which each defendant’s plea depends on the others’, or in which the benefit one defendant receives is conditioned on what another agrees to do. If the arrangement is all-or-nothing, as the civil offer is, one defendant’s refusal defeats the deal for everyone, including the defendants who wanted it. The stakes are sharper than in a civil case because liberty hangs on the package. Advice that serves one defendant, to take the deal that frees that defendant, may harm another who must plead guilty to make the deal possible. A signed consent from each defendant keeps a lawyer who owes loyalty to both from making that trade on the clients’ behalf.

The rule does not forbid the lawyer to negotiate, whether by initiating such an offer or responding to one. It forbids participating in the agreement without advance consent from each client.¹⁶ The disclosure behind that consent must include the existence and nature of all the pleas involved and each person’s participation.¹⁷ Commentary reads that to cover the details of every other client’s participation, including the resolution of their criminal charges and any other thing of value received through the resolution, so a favor to one client that is not monetary must still be disclosed to the others.¹⁸ In the dismissal-for-a-plea arrangement, Codefendant 2 must be told that Codefendant 1 goes free, and Codefendant 1 must be told what Codefendant 2 gives up to make that happen.

An exam stem in which two codefendants share a lawyer and each receives a plea offer invites the answer that Rule 1.8(g) automatically applies. Whether it does depends on whether the offers are linked.

That lawyer is not free of every concern. The general conflict rules continue to govern joint representation of codefendants whether or not the plea offers are linked, and the later discussion of Rule 1.7 returns to how the two rules fit together. The aggregated-plea clause adds a signed-consent requirement when the defendants’ outcomes are tied together.

Settlements Outside the Rule

Rule 1.8(g) bars a lawyer from participating in “an aggregate settlement of the claims of or against the clients” unless each client gives informed consent in a signed writing, and a deal earns the label only when the clients’ outcomes are tied together.²⁰ Two situations fall outside that coverage even though each can look, at first glance, like a settlement of many clients’ claims at once. One is the settlement each client negotiates and accepts separately. The other is the class action. The reasons differ. In the first, the conflict the rule guards against never forms. In the second, other safeguards stand in for each person’s signed consent.

A settlement that is individually negotiated, so that each client is free to settle or not as that client chooses, is not aggregate and escapes the special limits of the rule.²¹ The rule is built to prevent a particular danger. An aggregate deal fixes each client’s fate to the others’ and forces the lawyer to advise several people about one package that may serve some of them better than others. When each offer is negotiated on its own terms and stays open whatever the other clients do, that danger disappears. The lawyer advises each client about that client’s own proposal, and no client’s acceptance or refusal changes anything for anyone else. Sharing a lawyer, a defendant, and even an identical legal theory does not alter the analysis, because commonality of factual or legal issues does not by itself tie the outcomes together.²²

The exclusion turns on the conditions attached to the offers and not on how many documents the clients sign. Had the insurer told the tenants that every offer would lapse unless all five accepted, the five offers would have formed one package, the clients’ outcomes would have become interdependent, and the rule would apply in full. A lawyer who hears that a defendant wants a global resolution should ask what happens to the other offers if one client says no.

The second exclusion appears in Comment 13 to Rule 1.8, which says the aggregate settlement rule does not apply to class actions.²⁴ The comment reasons that lawyers representing a class of plaintiffs or defendants, or those proceeding derivatively, may not have a full client-lawyer relationship with each member of the class. The lawyer’s duty runs to the class as a whole and does not carry the undivided loyalty owed to each individual client. In place of individual consent, the comment directs the lawyer to comply with the rules on notifying class members and the other procedural requirements designed to protect the entire class.²⁵

Those two features answer the two purposes of the signed-consent requirement. The requirement exists so that each client receives balanced advice from a lawyer loyal to that client alone and keeps authority over whether to accept. Class members are not advised one by one in that way, so the first purpose has little to attach to. Outside review serves the second, because a class settlement requires a court to determine whether it is reasonable.²⁶ That judicial check does the work the client’s own signature does elsewhere, for a group that may be far too large to consult one at a time.

The exclusion stops at the edge of the class device. In Tax Authority v. Jackson Hewitt, Inc., the court surveyed earlier authority and recounted a decision that drew a “sharp distinction” between class actions and simple joinder. A class settlement requires a court to determine its reasonableness, but “[i]n a joinder action there is no judicial review of the settlement and a party should not be bound unless he has specifically agreed to it.”²⁷ That decision added that fundamental fairness is violated when a settlement is allowed to bind parties who object and no safeguards protect their interests.²⁸

Put the protections behind the class exclusion next to a joinder and neither is present. Every joined plaintiff is a full client owed undivided loyalty, and no judge reviews the settlement. The client’s signed informed consent is then the only safeguard left, which is why the rule continues to apply. An exam stem that describes dozens or hundreds of plaintiffs suggests the label class action, but the label matters only if the case is actually proceeding as a class, with notice to members and court review of the settlement. A mass of individually joined clients receives no exclusion from its size alone.

The two exclusions combine in a mass joinder. If the defendant makes separate offers and each stays open whatever the other plaintiffs do, the settlement is not aggregate and the rule is not triggered. If the defendant demands that all of the plaintiffs accept together, the settlement is aggregate, no class exclusion is available, and each plaintiff’s signed informed consent is required before the lawyer participates in making the deal.