[textbook]Traversing the Ethical Minefield Problems, Law, and Professional Responsibility by Susan R. Martyn (z-lib.org)(1) (1)

Nonetheless, twenty years later, with George firmly established at the Wilmington
office of the prestigious, old-line Philadelphia firm, Caldwell & Moore — practicing
corporate law no less — Lonnie, who had risen to president and chief operating officer of
the Mercury Maintenance Company, was presented with his first opportunity to send
business George’s way. Mercury, whose growth had been spectacular, found itself in need
of major new financing. Its old law firm had recently forced the retirement of Mercury’s
original lawyer and board member, Lewis Stern. Thus Lonnie felt free to steer this
important matter to George.
During the interim they had remained friends. Both moved to Greenville as they each
rose up their respective ladders. Their children were friends, baseball had given way to golf
(now played regularly at Wilmington Country Club), and the two couples socialized at
every opportunity. But this was the first time they had actually worked together.
At Lonnie’s initial visit, he explained the plan to George. Mercury had a series of longterm
contracts to replace streetlights and traffic controls for municipalities throughout the
Delaware Valley. Because of its reputation for high-quality, prompt, and low-cost service,
Mercury had signed multi-year contracts with over two hundred boroughs, townships,
three of the five major counties surrounding Philadelphia, and, of course, the City of
Wilmington. In discussions with Integrity Bank it had become clear that these contracts
were Mercury’s biggest asset. Based on the cash flow stability they represented, the bank
was prepared to lend significant sums to Mercury. Lonnie had negotiated the broad outline
of a deal in which Mercury would receive a $5 million loan to be drawn down in equal
installments quarterly across four years, permitting Mercury, as it expanded its operations
into New Jersey, to purchase the additional trucks and cherry pickers that were critical to
its delivery of service. He called on George to document the transaction, represent
Mercury, and provide Integrity with any routine legal opinions it required.
“Protect us as best you can,” Lonnie implored George, “but none of your aggressive
stuff — we need this money and you know how cussedly independent these banks can be.”
“You can count on me, Lonnie. I want your board to be proud of your selection of
lawyers, even though I know the real reason you hired me is to make up for your stealing
my Mickey Mantle rookie card. That’s something that you should feel guilty about. Do
you know what that would be worth today?”
“Your mom would’ve thrown it out with your old Lionel trains anyway,” Lonnie
replied.
George returned to the office, called up his friend Vince Almond at Integrity to inquire
who would be “lawyering” this transaction for the bank, learned that Vince himself would
be working on it, and made a date with Vince to meet within a week to discuss the matter.
The loan processing could not have been easier. The bank officials were so impressed
with Mercury’s success that many of the issues typically raised did not need to be addressed.
Similarly, the documentation went smoothly, and George’s firm was only asked to provide
opinion letters on the corporate authority of Mercury to enter into the loan transaction and
the enforceability of the long-term contracts, including the effect of the penalty clauses, if
any of Mercury’s customers attempted to terminate them early. Neither legal question was
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