When will a plaintiff's attorney be required to disclose his total liability in a settlement?

California, United States of America


The following excerpt is from Folsom v. Butte County Assn. of Governments, 186 Cal.Rptr. 589, 32 Cal.3d 668, 652 P.2d 437 (Cal. 1982):

We are not indifferent, though, to defendants' concern that one settling a lawsuit may want to know his total liability in advance of settlement. While the preferred procedure is to reserve fee issues for judicial consideration and determination (Anthony v. Superior Court, supra, 59 Cal.App.3d at p. 772, 130 Cal.Rptr. 758; see also, other cases cited in fn. 14, ante ), we decline to rule, as plaintiffs urge, that fee matters may never be injected into negotiations on the merits without placing counsel in a position of inherent conflict. We thus join this view of the White court: "In considering whether to enter a negotiated settlement, a defendant may have good reason to demand to know his total liability from both damages and fees. Although such situations may raise difficult ethical issues for a plaintiff's attorney, we are reluctant to hold that no resolution is ever available to ethical counsel." (102 S.Ct. at p. 1167, fn. 15.)

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