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In the Matter of the Rules of Professional Conduct and Insurer Imposed Billing Rules and Procedures
Montana Supreme Court
2 P.3d 806 (2000)
Insurance companies that paid their insureds’ attorney fees and settlements required that the insureds’ attorneys follow litigation-plan requirements that were intended to minimize the insurance companies’ expenses. A typical plan required an attorney to get the insurer’s consent before the attorney filed a motion, took discovery, or researched an issue on behalf of the insured client. If the attorney did not get the insurer’s prior consent, the insurer could withhold payment to the attorney. A typical plan also stated that if a conflict arose between the litigation plan and the attorney’s duty of loyalty to the insured client, the conflict had to be resolved in favor of the insured client. A group of attorneys (petitioners) applied to the Montana Supreme Court for declaratory judgment on the question of whether the Rules of Professional Conduct (rules) allowed an attorney to agree to an insurer’s requirements limiting the scope of representation of an insured client.
Rule of Law
Holding and Reasoning (Leaphart, J.)
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