Can an attorney continue representing a client after being terminated? Deseret First Federal Credit Union v. Parkin Explained

In Deseret First Federal Credit Union v. Parkin, the Utah Court of Appeals addressed whether an attorney can continue representing a client after being terminated and whether such conduct warrants sanctions under Rule 11.

Background and Facts

George Fadel represented the Wilma G. Parkin Family Protection Trust on a contingent fee arrangement in a quiet title lawsuit against Deseret First Federal Credit Union. The fee agreement entitled Fadel to one-half of any recovery exceeding $10,000. Against Fadel’s advice, the Trust entered into a mediation agreement to sell the disputed property for $30,000, entitling Fadel to a $10,000 fee. The Trust then hired new counsel and filed a stipulated motion to dismiss the case. Despite being replaced as counsel, Fadel continued filing pleadings on behalf of the Trust, including an objection to the dismissal and a motion in limine.

Key Legal Issues

The case presented two primary issues: (1) whether Fadel’s motion to intervene was timely filed, and (2) whether his conduct after being terminated as counsel warranted Rule 11 sanctions.

Court’s Analysis and Holding

The court held that Fadel’s intervention motion was untimely because it was filed after entry of judgment dismissing the underlying case. Under Rule 24(a), intervention is generally not permitted after entry of judgment. The court rejected Fadel’s argument that no final judgment had entered, noting that the December 2011 dismissal of the case between the original parties constituted a final judgment, even though sanctions remained pending against Fadel as a non-party.

Regarding sanctions, the court found that Fadel violated Rule 11 by continuing to represent the Trust after being terminated. The court determined this created a conflict of interest under Utah Rules of Professional Conduct 1.7, as Fadel prioritized his own financial interest in a larger fee over the Trust’s decision to settle. An attorney must “abide by a client’s decision whether to settle a matter” under Rule 1.2(a), and once the Trust chose to settle against Fadel’s advice, he was required to either support that decision or withdraw.

Practice Implications

This decision reinforces important ethical boundaries for attorneys. Contingent fee arrangements do not give attorneys the right to override client decisions about settlement. When a client terminates representation, the attorney must cease acting on the client’s behalf, regardless of any financial interest in the outcome. For intervention practice, attorneys should note that the relevant date for determining timeliness is when the underlying case between the original parties is resolved, not when all ancillary matters conclude.