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Tough divorce attorneys smack into wall of conflict

Prominent lawyers feel sting as clients try end-run in system


by: TRIBUNE PHOTO: CHRISTOPHER ONSTOTT - Portland attorney Jody Stahancyk has become the prime target of momentary clients using a legal maneuver to make sure she doesn't represent their spouses.
This is what happens when you get a reputation as the roughest, toughest, you-don’t-want-to-mess-with-me divorce attorney in town.

Jody Stahancyk is the attorney in question, and love her or hate her, if you’re getting a divorce, she’s the lawyer you don’t want representing your spouse. Or at least, that’s what a number of people seem to think, since Stahancyk has become the prime target of a legal but maybe not so ethical strategy called “conflicting out.”

Here’s how it works: Say a wealthy husband has already chosen legal representation for his not-yet-announced divorce. But having heard of Stahancyk’s reputation, he knows he doesn’t want his attorney going up against her. So he sets up an appointment with Stahancyk and pays for an initial consult. He tells her a thing or two about his situation, and leaves knowing that because of strict Oregon rules governing attorney conflict of interest, Stahancyk cannot represent his wife.

There are only a handful of high-profile divorce attorneys in Portland, and most say they’ve been the victims of such strategies on occasion. But only Stahancyk has seen it happen to her with regularity. And that’s despite the fact that the Oregon State Bar in 2010 amended its rules governing professional conduct with the intention of curbing the practice.

Stahancyk says a common tactic in the past was people calling on the phone and speaking not with her but with another attorney in her firm. After a brief telephone discussion the caller would claim he or she had revealed confidential information so none of the attorneys in the firm, including Stahancyk, could get involved in the case.

The Bar rule change was supposed to cover that, but it hasn’t stopped the practice. Stahancyk says she continued to lose clients due to alleged conflicts of interest after the rule change.

And that is why today attorneys in Stahancyk’s firm don’t answer their own phones. Instead, all calls are handled through an intake specialist — not an attorney — with whom conversations don’t result in a potential conflict of interest.

Stahancyk says she has even had other law firms in town call and ask for her help on a case when their true intent was to keep her from eventually representing the spouse in a divorce she didn’t even know about.

About a year ago, Stahancyk developed a form letter that all new clients are required to sign before they see an attorney in her firm. The letter lays out the trouble the firm has been having with being intentionally conflicted out of cases and states clearly that if “the firm does not represent you after the initial consultation, the firm may be able to represent your spouse.”

Stahancyk says it’s working and that a greater percentage of new clients are signing and putting her firm on retainer after consults.

Brad Miller, an attorney in Stahancyk’s firm, says he’s had clients walk out when asked to sign the letter. Those, he figures, were the ones looking to conflict out Stahancyk and her firm.

Ringing up the trouble

Stahancyk admits the practice works both ways. She says she has had clients ask her which attorneys she would prefer not to go up against so that they can make appointments and eliminate them. She says she tells them not to bother.

Stahancyk has even learned that a number of therapists, once it became obvious a divorce was in a patient’s future, advised their patients to conflict out the city’s top lawyers.

Stahancyk thinks the potential for conflicting out attorneys has even guided the development of large law firms in Oregon. Many of the largest, she says, don’t have family law departments because they know that if their attorneys represent a wife in a divorce case, they might become conflicted out of a lot of corporate law business that the husband might have brought in.

And the practice has had an even greater impact in smaller cities such as Bend, where there aren’t many divorce lawyers to start with. Stahancyk’s firm has an office in Bend, and she’s seen one spouse try to tie up all the divorce lawyers in town.

Conflicting out Stahancyk or any other divorce attorney is not a practice for the weak of heart, or of pocketbook. An initial consultation with Stahancyk can run as much as $750.

“I should be quite pleased I have this problem,” Stahancyk says.

It comes with the reputation, apparently.

“I’m always amazed at all the suggestions that we are the meanest bitch in town,” Stahancyk says. “Over my lifetime I’ve learned that bitch means cunning fox. They call us names, but in the end, if we have clients who are satisfied, that is what I am concerned about.”

Potential fraud?

Eric Larsen, another high-profile Portland divorce attorney, says conflicting out happens in other cities as well, but that Oregon’s laws governing distribution of assets in a divorce also lead to some peculiar situations.

Neighboring California and Washington are community property states while Oregon is an equitable distribution state. Basically, Larsen says, that means that alimony awards are often higher in Oregon.

Larsen says he has seen cases where a husband moved to Washington to establish residency so the divorce could take place there. But the strategy comes with a catch, he says. For the case to be heard in Washington the wife has to be served the divorce papers in that state. Which, Larsen says, sometimes leads to underhanded tactics to get the wife to cross the state border.

“It’s a horrible way to start a divorce, but it happens,” he says.

Family mediator Bill Schulte says that when he practiced divorce law he also would occasionally be targeted by people who wanted to conflict him out of a case.

“They’d just kind of talk to you long enough and then they’d leave,” Schulte recalls.

In fact, Schulte says he knows an attorney in Portland who recently divorced his wife and purposely eliminated many of the city’s top attorneys as potential representatives for his wife.

Portland attorney David Gearing says it’s not always easy to know if an intentional conflicting out has occurred. There’s nothing wrong with shopping around for an attorney, he says.

But Gearing wonders if those who intentionally conflict out attorneys are actually committing illegal acts, such as fraud. There’s a tort category called “intentional interference with prospective advantage or contractual relations,” he says. A man or woman lying to eliminate an attorney from representing his or her spouse might in fact be defrauding that attorney.

“Not that anybody’s going to pursue a suit against someone like that,” Gearing says.

Gearing, Schulte, Larsen and Stahancyk agree that the strategy of eliminating a top divorce lawyer can backfire and lead to longer divorces. They prefer having experienced attorneys across the aisle from them.

“It’s like playing tennis,” Stahancyk says. “Do you have a better tennis game with a person of similar skills or do you have a better game with someone who can’t play tennis very well? One of the things good lawyers do is save you time by getting to a final decision quickly.”