Effective February 1, 2007, the Ohio Supreme Court's new Rules of Professional Conduct go into effect. Starting on that date, a Statement of Insured Client's Rights is now mandatory, going directly from the assigned attorney to the insured, within ten days of receipt of the assignment.
Ethical duties arising from the retention of defense counsel by liability insurers have been the subject of case law, ethical decision- making, and scholarly commentary for many years. The Ohio Supreme Court task force that drafted the new rules took all of this into account, and drafted this statement that encompasses many of the common issues arising from what has been called the tripartite relationship-- insurer, insured, and insurance-paid counsel.
Statement of Insured Client’s Rights
While many of the provisions of the new Rules have analog or counterpart provisions either in Ohio's Code of Professional Responsibility, or decisional gloss on the Code, this particular statement has no precedent, other than to embody principles that have been articulated in prior decisions, comments, or the ABA Model Rules, on which Ohio's rules are generally based.
The issues addressed by the Statement are of central importance to the attorney-client relationship. The task force and the Supreme Court included issues of coverage, insurance litigation guidelines, communications, confidentiality, legal audits, conflicts of interest, settlement ability, payment of fees and costs by the insurer, and the insured's right to retain independent counsel. Counsel receiving assignments where any insurance defense is implicated should be prepared to discuss these issues in circumspect fashion, as the statement can only be expected to engender discussion and questions. While we think such discussion to be healthy in terms of the attorney-client relationship, it is important that insurers also be attuned to the questions that will be prompted by the new requirement.
Reminger is available for consultation by our insurance clients regarding the implications of the new statement, including seminars to your staff. Several of our professional liability partners have already conducted seminars to lawyers across the state, and we will gladly speak to your claims department regarding the issues that have been created by this new requirement.