Cardinale v. Golinello
| Decision Date | 19 December 1977 |
| Citation | 372 N.E.2d 26,401 N.Y.S.2d 191,43 N.Y.2d 288 |
| Parties | , 372 N.E.2d 26 John CARDINALE et al., Appellants, v. Frank GOLINELLO, Respondent, et al., Defendants. |
| Court | New York Court of Appeals Court of Appeals |
Charles P. Schiller, New York City, for appellants.
Steven A. Greenwold, Poughkeepsie, and Peter P. Tavolacci, Brewster, for respondent.
There was no abuse of discretion when the courts below held that appellants' counsel were disqualified from further representing appellants because of an impermissible conflict of interest.
The question of attorney disqualification which is the subject of the present appeal was raised by defendant Golinello's motion to disqualify plaintiffs' attorneys from representi them in this action. The underlying litigation between the clients had its genesis in the purchase by defendant Golinello of the capital stock of Cross County Sanitation Corp., a company engaged in the refuse hauling business. The contract of sale was signed on January 21, 1972, and the closing took place on February 4, 1972. Golinello was represented in the transaction by John Somers, Esq., of Halperin, Somers & Goldstick, P. C.
Charles P. Schiller, an attorney, was thereafter employed by Halperin, Somers & Goldstick, P. C., from February 14 to December 29, 1972. During this period Mr. Somers and Halperin, Somers & Goldstick, P. C., continued to do legal work for Golinello. It is not asserted that at any time Mr. Schiller personally rendered legal services on Golinello's behalf. It does appear, however, that Halperin, Somers & Goldstick, P. C., was a small firm whose activities were characterized by an understandable informality and in which it is asserted that there was a "constant cross-pollination going on" and a "cross current of discussion and ideas" among all attorneys on all matters which the firm handled. Separate offices were not physically isolated; the conference room and all firm files were open and available to all lawyers in the firm, including Mr. Schiller.
On April 10, 1975 plaintiffs retained the firm of King & King to represent them in connection with claims against Golinello, Somers, and Somers, Goldstick & Weinberger, P. C. (successor to Halperin, Somers & Goldstick, P. C.), arising out of the 1972 sale of the Cross County stock and transactions subsequent thereto. In July, 1975 Mr. Schiller rented space in the office of King & King which firm thereafter referred legal matters to Mr. Schiller on an "of counsel" basis. In August, King & King, "with the knowledge and consent of the plaintiff requested Mr. Schiller to handle the litigation of plaintiffs' claims against defendants.
In the fall of 1975 Mr. Schiller appears to have participated in the preparation of the summons and complaint in the present action which were served on December 11, 1975. 1 Defendants promptly served a demand for a bill of particulars. They first learned of Mr. Schiller's participation in the litigation when the papers on plaintiffs' motion for a protective order were forwarded by Mr. Schiller to defendants' counsel on December 23, 1975 and it appeared that the affidavit in support of the motion had been made by him. On January 22, 1976 defendant Golinello moved to disqualify Mr. Schiller and the firm of King & King from further representation of plaintiffs. Mr. Schiller and Martin J. King submitted affidavits in opposition to the motion for disqualification. It appears that Mr. Schiller requested a formal opinion from the Westchester County Bar Association as to the ethical propriety of his continued representation of plaintiffs, but that such request was properly denied on the ground that the issue was then in litigation.
On June 15, 1976 Special Term granted defendant's motion and ordered that Mr. Schiller and King & King be disqualified from further representation of plaintiffs in this action. On January 3, 1977 the Appellate Division affirmed, by a divided court. An appeal from the order of the Appellate Division is now before us pursuant to leave granted by that court on a certified question. Mr. Schiller has appeared for appellants.
The order of the Appellate Division should be affirmed. While defendant has not established that Mr. Schiller personally rendered legal services to Golinello during the period of his employment by Halperin, Somers & Goldstick, P. C. in 1972, and indeed his employment with that firm commenced after the February 4, 1972 closing of Golinello's purchase of the Cross County stock and was terminated prior to the alleged divestiture of Cross County, there is such a conflict of interest in violation of the Code of Professional Responsibility, at least as the courts below were entitled to conclude, as to call for the disqualification of Mr. Schiller and the firm of King & King.
As to the conflict of interest we note that the amended complaint alleges transactions and activities on the part of defendants in connection with the sale in early 1972 of the Cross County stock and that the claimed conspiracy is alleged to have been commenced in 1971 and to have been pursued in the years subsequent thereto and during the time when Mr. Schiller was associated with the law firm which was then representing defendant Golinello. It is of no moment for present purposes that Mr. Schiller claims that he did not personally render any legal services to Golinello; it suffices that he was associated with the firm that did.
It is significant to observe that in this instance there is not presented for resolution the potentially difficult problem of balancing the interests of a client desirous of retaining an attorney of his personal choice and preference against the interests of the opposing litigant to be free from the risks of opposition by a lawyer once privy to that litigant's confidences. In this case Mr. Schiller's representation of plaintiffs was undertaken at the instance of the law firm of King & King. While such representation is asserted to have been with the knowledge and consent of plaintiffs, other than as might be inferred from such conclusory assertion there is no tender of evidentiary proof that plaintiffs in fact knew of Mr. Schiller's involvement. There is not even a suggestion, much less any proof, that either plaintiff desired or sought Mr. Schiller's professional services. Thus, this record is entirely devoid of any evidence of an interest of substance on the part of plaintiffs that they be represented by Mr. Schiller. His participation was only at the instance of King & King, plaintiffs' retained counsel. Whatever might be the degree of risk of conflict or the quantum of possible conflict which might be necessary to call for...
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