Legal Question in Business Law in California

Re: Attorney - Client question

This is a more complicated question than you might expect.

The attorney has an obligation to his client, the partner in the law suit.

The obligation is not to the partnership, nor to any of the other partners. Unless the partner involved in the lawsuit authorizes the communication, the lawyer should not share lawsuit information with anyone other than his client.

Re: Attorney - Client question

For the benefit of LawGuru users who might be wondering, a "TIC" as this user is asking about is a "tenancy in common" investment arrangement, allowing several investors to share ownership of real property. They are sometimes used in connection with IRC 1031 tax exchanges.

Not all TIC arrangements are true partnerships. In fact, one of the reasons for TICs is that they lack many of the characteristics of a partnership including how the property is vested, joint and several liability, etc. I suppose a TIC arrangement could be coupled with a partnership for purposes of management and joint decision-making. Tenancy in common does not, in itself, necessarily result in a partnership, even if profits are shared. Corporations Code section 16202(c)(1).

I think a real question arises here as to whether and why the TIC is paying for the defense of this lawsuit. I suppose there is a "hold harmless and defend" or similar clause in some agreement. Then, I'd want to examine whether the lawyer is really working for the "partner" or the TIC. This is indeed a complex issue and may involve concepts such as indemnity, tender of defense, subrogation, insurance, hold-harmless clauses, and certainly requires review of any agreements among the co-owners.

Re: Attorney - Client question

The attorney-client relationship covers only the client, not the third parties who pay the bills. Unless he sued or is being sued in his capacity as a partner, the partnership has no claim to any confidential information about the case.