Hiring a lawyer involves an immense amount of trust. Once the attorney-client relationship begins, youโre counting on them to protect some of the most important things in your life: your finances, your rights, and in many cases, your future. For this reason, the law holds attorneys to one of the highest standards of loyalty, known as a fiduciary duty. This means that your lawyer is legally and ethically required to put your interests above their own at every stage of your working relationship.
Unfortunately, some lawyers fail to abide by the standard of care required in the fiduciary relationship. Some may use their position to enrich themselves, hide their mistakes, or serve interests that directly compete with those of their clientโs. As a major violation of professional ethics, breaching the fiduciary relationship can seriously harm clients, thus paving the way for a lawsuit that holds attorneys accountable for legal malpractice.
So, what can you do if your lawyer betrayed your trust? The first step is understanding how California law defines the fiduciary duty and how to know when such a betrayal is legally actionable. In this article, we explain what the fiduciary relationship is, describe the most common breaches of fiduciary duty by lawyers, and outline what you can do if one of these situations sounds familiar.
If youโve suffered losses as a result of your lawyer’s negligence or ill will, our legal malpractice attorneys are here to help you recover.
What is a Breach of Fiduciary Duty?
A breach of fiduciary duty occurs when a person who is legally obligated to act in another partyโs best interest puts their own interests first, often causing harm to the other party. The โfiduciaryโ is the person who must prioritize the interests of the other person or entity, who is the โbeneficiaryโ of the relationship.
Trustees, financial advisors, corporate officers, and board members are all fiduciaries. However, California courts recognize the attorney-client relationship as one of the highest and most sacred fiduciary duties. From the moment the attorney-client relationship is formed, your lawyer owes you undivided loyalty, honesty, confidentiality, and full disclosure of anything that could affect your interests. Your lawyer must advocate for you, protect your assets, and represent you as if your interests were their own.
A lawyer placing their own interests (or someone elseโs) ahead of yours can take many forms, from concealing information you had a right to know, to misusing the money, property, or confidences you trusted them with. Importantly, breaching a fiduciary duty shouldnโt be confused with an unfortunate but honest mistake. It involves an element of betrayal or disloyalty, not just error, which is why it can warrant a serious legal malpractice claim.
Is Breach of Fiduciary Duty Considered a Crime?
In most cases, no, a breach of fiduciary duty does not constitute a crime, but a civil wrong. This means the remedy is typically a lawsuit to recover damages, as well as potential disciplinary action from the State Bar of California. However, the conduct behind the breach can certainly be a crime, like if your attorney used their privileged position to embezzle funds or commit fraud. These cases, however, are rare and extreme, and it’s important to note that you would still need to file a legal malpractice suit alongside any criminal charges, as criminal cases are meant to punish the attorney but not compensate you for losses.
Furthermore, a breach of fiduciary duty does not automatically amount to legal malpractice. To bring a successful malpractice claim, you must also prove that the breach caused you real, measurable harm. But in practice, legal malpractice lawsuits very often begin with one of the breaches described below.
Common Breaches of Fiduciary Duty by Lawyers
There are countless ways an attorney may breach their fiduciary duty, but most cases fall into a handful of recognizable patterns. If any of the following examples resemble your experience with a current or former attorney, it may be worth speaking with a legal malpractice lawyer.
Self-Dealing
Self-dealing occurs when a lawyer uses the attorney-client relationship to benefit themselves, sometimes leading to lost opportunities or unfavorable outcomes for the client. Because attorneys often have access to sensitive financial information or insider knowledge and hold significant influence over their clientsโ decisions, California law places strict limits on any business or financial dealings between a lawyer and their client.
Common examples of self-dealing include an attorney purchasing property from a client at below-market value, entering into a business venture with a client without full written disclosure, encouraging a client company to make a transaction because it would benefit the attorney, or structuring a fee arrangement that quietly favors the attorney. A classic example is when attorneys take undisclosed payouts (or kickbacks) disguised as โreferral feesโ or โmarketing feesโ from vendors in exchange for steering a client’s business towards them.
According to the California State Barโs Rules of Professional Conduct, a lawyer generally cannot enter into a business transaction with a client unless the terms are fair, fully disclosed in writing, and the client has been advised to seek independent counsel and consented in writing. If a lawyer skips these safeguards and profits as a result, they have almost certainly breached their fiduciary duty, and bringing a legal malpractice suit may be the next step to recover what youโve lost as a consequence of their misconduct.
Conflicts of Interest
A conflict of interest exists when a lawyerโs obligations to another client, a former client, a third party, or their own personal or financial interests could compromise their ability to represent you with undivided loyalty. This is similar to but distinct from self-dealing, which is an aggravated form within the broader category of conflicts of interest. Conflicts are among the most common sources of legal malpractice claims because they can quietly influence every decision an attorney makes in your case.
Examples include representing two clients with opposing interests in the same matter, representing a client who is suing a party the attorney has a financial relationship with, or using strategies designed to protect the lawyerโs other clients rather than you. Attorneys are required by California law to identify conflicts early, disclose them fully, and in many situations obtain the clientโs written informed consent before proceeding. Sometimes, the only ethical option is to decline the representation altogether. If your attorney concealed a conflict and continued to collect fees, theyโve placed their own interests ahead of yours, which is the textbook definition of breach of fiduciary duty.
Misappropriation of Client Funds
Few breaches are more serious than a lawyer mishandling their clientโs money. California attorneys are required to keep client funds in a dedicated trust account, separate from the firmโs own money, and to provide an accurate accounting whenever the client requests a statement.
Misappropriation can look like withdrawing fees that havenโt been earned, โborrowingโ from a client trust account, commingling client money with the attorneyโs personal or business funds, delaying or withholding settlement proceeds that belong to the client, billing for work that was never performed, or inflating logged hours. Even a very temporary misuse of client funds is a breach of fiduciary duty, and the State Bar treats these violations severely, often with suspension or disbarment. Misappropriation or misuse of funds will very often establish grounds for a legitimate legal malpractice claim, plus a claim for fee disgorgement, in which the attorney is forced to return the fees they collected while acting disloyally.
Failure to Communicate
Your attorney has a duty to keep you reasonably informed about your case and to respond promptly to your questions. While a slow reply to an email is not malpractice, a sustained pattern of silence, especially one that hides important developments, can rise to the level of a fiduciary breach.
Serious communication failures include not making you aware of a settlement offer, failing to tell you about a court ruling or deadline that affects your rights, hiding a mistake they made in your case, or effectively abandoning your matter completely while continuing to bill you. The very first chapter of the California State Barโs Rules of Professional Conduct clearly outlines rules and best practices regarding client communication. If your attorney continues to fail to communicate effectively with you, theyโre running the risk of jeopardizing your case and could potentially be held liable for legal malpractice.
An attorneyโs failure to communicate settlement offers deserves special attention. Under Californiaโs professional conduct rules, the decision to accept or reject a settlement always belongs to the client. A lawyer who conceals an offer, or worse, accepts one without your consent, has committed a clear violation of their duty to you by failing to communicate a key milestone in the case.
Violation of Confidentiality
Confidentiality is the bedrock of the attorney-client relationship. Under California law, lawyers are required to protect their clientsโ confidential information โat every peril to himself or herself,โ and this obligation continues even after the representation ends.
A breach of this duty is fairly self-explanatory. Attorneys must protect your confidential information in the same way a doctor or therapist is bound to keep your information private. If your lawyer discloses your confidential information to outside parties without your consent, uses your private information for their own benefit or the benefit of another client, or discusses the details of your case in ways that expose you to harm, theyโre breaching their fiduciary duty. Outside of narrow exceptions, such as preventing a serious crime, there is virtually no justification for a lawyer revealing your private information. Violations of confidentiality are a strong basis for a legal malpractice claim if the lawyer caused legal or financial harm by revealing the confidential information.
Neglect or Abandonment of Your Case
The duty of loyalty and the duties of competence and diligence are key ingredients of the fiduciary relationship between an attorney and their client. An attorney who takes your case, collects your money, and then neglects to take any action is crossing the boundary between providing poor service and blatantly breaching their fiduciary duty.
If an attorney fails to file your case by the statute of limitations, doesnโt show up to mandatory hearings, or ignores other key obligations until the court imposes sanctions, their actions might constitute attorney abandonment. Similarly, some attorneys abruptly withdraw from cases altogether, sometimes without even notifying the client. If your lawyer neglects their duties like this, causing you to lose your case or even your right to bring it in the first place, you may have grounds for a serious legal malpractice claim.
What To Do if Your Lawyer Breached Their Fiduciary Duty
If any of the situations above sound familiar, it’s important to act quickly and decisively. In California, you generally have only one year from the date you discovered (or should have discovered) the misconduct to file a legal malpractice claim, or four years from the date of the wrongful act (whichever comes first). There are a few exceptions that can extend these deadlines, including continued representation by the attorney, but waiting too long will risk your ability to ever file the claim.
Start by gathering any physical and digital documentation, including your retainer agreement, billing statements, correspondence with your attorney, and any court filings from your case. You also have the right to request your complete client file, and your attorney must provide it, even if you owe them fees.
Once youโve secured any materials related to your case and your attorneyโs misconduct, speak with a legal malpractice attorney as soon as possible. Legal malpractice claims are notoriously complicated and require the skills of a lawyer who has specific experience in this field. A specialized legal malpractice lawyer can evaluate your situation and determine whether your attorneyโs breach supports a claim for:
- Economic damages to compensate you for the financial damages and lost opportunities your lawyer caused you.
- Disgorgement of fees, demanding that your attorney repay you for the legal fees they collected while in breach of the fiduciary duty.
- Punitive damages in extremely rare cases involving intentional deception, fraud, etc.
Importantly, you should absolutely never try to bring a legal malpractice case by yourself, no matter how confident you are that youโve been wronged. The defending attorney will, by default, be vastly more prepared than you, and will know exactly what methods they can use to defend themselves against your claims.
How We Can Help
A breach of fiduciary duty is a tragic betrayal of the trust you placed not only in your individual lawyer, but in the legal system of your state and country that was designed to protect you. At Stalwart Law Group, we want you to know that you are entitled to certain rights and protections, and we welcome the opportunity to hold to account lawyers who have disregarded the high ethics of the legal profession. Whether your lawyer engaged in self-dealing, hid a conflict of interest, mishandled your money, or kept you in the dark about your own case, you deserve answers, and you may be entitled to significant compensation.
Stalwart Law Group is built for these cases. Dylan Ruga, a partner at Stalwart Law Group, is certified in Legal Malpractice Law by the State Bar of Californiaโs legal specialization program, a distinction held by fewer than one-tenth of one percent of lawyers in Los Angeles County. Legal malpractice claims are inherently difficult, requiring you to prove not only that your attorney betrayed you, but that their betrayal constitutes professional negligence and caused you demonstrable harm. Our team has the rare specialization and courtroom experience these cases demand, and we have helped Californians just like you recover after suffering losses from wrongful or negligent legal representation.
If your attorney breached their fiduciary duty, donโt face the aftermath alone. Contact Stalwart Law Group today for a free case evaluation. Weโll listen to your story, help you identify the evidence that matters most, and fight to hold your former lawyer accountable.
