Legal Ethics Opinion No. 1391

 Real Estate Transactions/Practice--Conflict of Interests--Former
Client: Attorney/Substitute Trustee Foreclosing on Deed of Trust
on Real Estate Which is an Asset of the Estate of Former Client

You have indicated that Attorney prepared a will for Client A
before A's death and also advised beneficiaries of the will, in
regard to the will, after A's death.  Further, you indicate that,
prior to A's death, a Deed of Trust was placed on A's real
property and the note securing the Deed of Trust was not paid. 
Attorney has contracted with B to serve as substitute trustee in
foreclosures on notes held by B and B now requests that A
foreclose on the Deed of Trust executed by A before his death. 
Finally, you indicate that Attorney never represented A in regard
to the Deed of Trust nor gave any advice as to the Deed of Trust
or related matters.

You have requested that the committee opine as to the propriety
of Attorney acting as substitute trustee under the present
circumstances.

The appropriate and controlling disciplinary rule to the question
you raise is DR 5-l05(D) which requires that a lawyer not
represent a new client in a matter which is the same or which is
substantially related to a matter in which he represented a
former client, if the new client's interest is adverse in any
material respect to the interest of the former client, unless the
former client consents after disclosure.

The committee has earlier opined, in general, that the mere fact
that a lawyer has formerly represented a person, who is now the
adverse party in a suit brought by the lawyer on behalf of
another client, is not sufficient to create an incurable conflict
unless the lawyer possesses confidential information which he
obtained from the first client.  LEO #44l; see also LEO #622.  In
addition, the committee has specifically opined that, even where
a lawyer serves simultaneously as counsel for a borrower and as
trustee on the underlying deed of trust, the lawyer may foreclose
on the deed of trust without first obtaining consent of the
borrower if two conditions are satisfied: (l) the attorney must
not have counseled the borrower as to the terms or conditions
contained in the note or deed of trust; and (2) following
closing, the attorney must not have continued a relationship with
the borrower which could be deemed to have been representation in
the same or a substantially related matter.  LEOs #824, ll53.

The committee is of the opinion that it would not be improper for
the Attorney to act as substitute trustee on the Deed of Trust
executed by client A before his death, since, under the facts you
have presented, no representation had been provided to A by
Attorney with regard to the real property which is the subject of
the foreclosure.  The committee is of the view, however, that, if
the advice provided by Attorney to the beneficiaries under the
will involved matters related to the property or to the note
securing the Deed of Trust, it would be incumbent upon the
Attorney to secure the consent of the beneficiaries, as required
by DR 5-l05(D), prior to foreclosing.

Committee Opinion
January 14, 1991