City of Santa Barbara v. Superior Court

• Decision Date: 07 September 2004
• Docket Number: No. B175204.,B175204.
• Citation: 18 Cal.Rptr.3d 403,122 Cal.App.4th 17
• Court: California Court of Appeals Court of Appeals
• Parties: CITY OF SANTA BARBARA, Petitioner, v. The SUPERIOR COURT of Santa Barbara County, Respondent; Robert Stenson et al., Real Parties in Interest.

18 Cal.Rptr.3d 403

122 Cal.App.4th 17

CITY OF SANTA BARBARA, Petitioner, v. The SUPERIOR COURT of Santa Barbara County, Respondent Robert Stenson et al., Real Parties in Interest.

No. B175204.

Court of Appeal, Second District, Division 6.

September 7, 2004.

Stephen P. Wiley, City Attorney, City of Santa Barbara and Janet K. McGinnis, Assistant City attorney, for Petitioner.

No appearance for Respondent.

Hatch & Parent, a Law Corporation; Diane M. Matsinger and Eric Berg, Santa Barbara, for Real Parties in Interest.

YEGAN, J.

An attorney who switches sides during litigation is disqualified from representing his or her former adversary. The disqualification extends to the attorney's entire new law firm. But a city attorney's office is not a "law firm" within the meaning of the vicarious disqualification rule. As we shall explain, in an ordinary civil case, disqualification of a nonsupervisorial deputy city attorney should not result in the vicarious disqualification of the entire city attorney's office. Such would deprive the city of its counsel of choice, result in an unnecessary burden on the public fisc, and provide an unnecessary litigation disadvantage to the city.

To be sure, the appearance of justice is important and the courts should, when necessary, do everything in their power to protect the confidentiality of attorney client communications. However, in the presenting circumstances, the creation and maintenance of an "ethical wall" or "ethical screen" is sufficient to protect the confidentiality of attorney client communications, as well as the integrity of the judicial process.

Facts

On June 1, 2003, water and sewage from a City of Santa Barbara (City) main flooded portions of the Stensons' house on Edgewater Way in Santa Barbara. The City contends this incident occurred because the Stensons did not equip their sewer lateral with a working backflow device. The Stensons contend they are not required to install a backflow device and that the incident occurred because the City failed properly to maintain and repair the sewer line.

The Stensons retained Hatch & Parent to represent them in litigation against the City for damages caused by the incident. Two Hatch & Parent lawyers, Eric Berg and Sarah Knecht, worked on the matter. Between early December 2003 and February 2004, Ms. Knecht performed over 30 hours of legal services for the Stensons, representing about 40 percent of the total time billed by Hatch & Parent. Among other things, she met with Dr. Stenson to discuss the factual and legal basis for the lawsuit and to develop a strategy for pursuing the claim against the City. Knecht reviewed documents, videotapes and photographs submitted by Dr. Stenson and inspected the property. She also conducted legal research and drafted discovery requests.

In early February 2004, Knecht informed Hatch & Parent that she had accepted a job at the city attorney's office. Her first day of work for the City was March 8, 2004. In the interim, the Stensons informed both the city attorney and Janet McGinnis, the assistant city attorney responsible for this litigation, that they would move to disqualify the office based on Ms. Knecht's conflict of interest.

McGinnis constructed an "ethical wall" to prevent Knecht's access to any information, documents or other materials related to the Stenson litigation. McGinnis does not supervise Knecht and her staff does not work for or with Knecht. Everyone in the office has been instructed "to prevent [Knecht] from being involved in communications about this case or having access to any records or documents related to this case." Litigation files are segregated from files on nonlitigation matters and are stored in or near McGinnis' office. Knecht does not work on litigation matters and "has had no reason to access any cabinet with litigation files." McGinnis does not attend office staff meetings or report on litigation to any member of the office other than the city attorney, Stephen Wiley.

Trial Court Ruling

The trial court concluded an ethical wall was not sufficient and that disqualification of the entire city attorney's office was required by the vicarious disqualification rule. In its writ petition, the City contends the order should be vacated because its ethical wall will protect the Stensons' confidences. The Stensons concede that Knecht has not disclosed their confidential communications but they do not waive the conflict. They maintain they should not be required to trust that their adversary in litigation will refrain from using confidential information against them.

First Impression Case

As the Stensons point out, no California court has sanctioned the use of an ethical wall under the circumstances present here: an attorney with direct, personal knowledge of client confidences goes to work for the clients' adversary while the litigation is pending, moving from a private law firm to the public law office representing the adversary, which office has established an ethical wall to prevent the disclosure of confidential information. Cases that have accepted ethical screening for public lawyers have involved lawyers who did not personally work on the matter in which the conflict is raised (Chambers v. Superior Court (1981) 121 Cal.App.3d 893, 175 Cal.Rptr. 575), lawyers involved in criminal prosecutions (Chadwick v. Superior Court (1980) 106 Cal.App.3d 108, 164 Cal.Rptr. 864), or lawyers who were physically and functionally separated from their adversaries. (People v. Christian (1996) 41 Cal.App.4th 986, 48 Cal.Rptr.2d 867; Castro v. Los Angeles County Bd. of Supervisors (1991) 232 Cal.App.3d 1432, 284 Cal.Rptr. 154.) Cases rejecting ethical walls have involved public lawyers who personally represented the conflict-creating client and who also have managerial, supervisory and policymaking responsibilities in the public law office. (See, e.g., People v. Lepe (1985) 164 Cal.App.3d 685, 211 Cal.Rptr. 432; Younger v. Superior Court (1978) 77 Cal.App.3d 892, 144 Cal.Rptr. 34.)

An appellate court reviews routine attorney disqualification orders for abuse of discretion. (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems Inc. (1999) 20 Cal.4th 1135, 1143, 86 Cal.Rptr.2d 816, 980 P.2d 371 (hereafter, SpeeDee Oil Change).) But this is not a routine case. Indeed, the trial court did not even purport to exercise discretion; ruling instead that vicarious disqualification was mandatory. When the trial court issued its order and when we issued our order to show cause, no published California case had considered vicarious attorney disqualification in the context of an entire city attorney's office. We decide the question of law on a de novo basis.

Attorney Disqualification

"A trial court's authority to disqualify an attorney derives from the power inherent in every court `[t]o control in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner connected with the judicial proceeding before it, in every matter pertaining thereto.' (Code Civ. Proc., § 128, subd. (a)(5). . . .)" (SpeeDee Oil Change, supra, 20 Cal.4th at p. 1145, 86 Cal.Rptr.2d 816, 980 P.2d 371.) Motions to disqualify counsel are especially prone to tactical abuse because disqualification imposes heavy burdens on both the clients and courts: clients are deprived of their chosen counsel, litigation costs inevitably increase and delays inevitably occur.¹ As a result, these motions must be examined "carefully to ensure that literalism does not deny the parties substantial justice." (Id. at p. 1144, 86 Cal.Rptr.2d 816, 980 P.2d 371.) At the same time, we recognize that disqualification of counsel is necessary under certain circumstances, to protect the integrity of our judicial process by enforcing counsel's duties of confidentiality and loyalty. (Id. at pp. 1145-1146, 86 Cal.Rptr.2d 816, 980 P.2d 371; see also Flatt v. Superior Court (1994) 9 Cal.4th 275, 283-284, 36 Cal.Rptr.2d 537, 885 P.2d 950.)

An attorney's ethical duties to maintain undivided loyalty to his or her clients and to preserve the confidentiality of client communications require that the attorney refrain from simultaneous or successive representation of clients with adverse interests. (Rules Prof. Conduct, rule 3-310.)² At a minimum, standards of professional responsibility mandate that an attorney not switch sides during pending litigation, moving from the representation of one party in a lawsuit to the representation of that party's adversary in the same matter. Switching sides "suggests to the clients — and to the public at large — that the attorney is completely indifferent to the duty of loyalty and the duty to preserve confidences. However, the attorney's actual intention and motives are immaterial, and the rule of automatic disqualification applies." (SpeeDee Oil Change, supra, 20 Cal.4th at p. 1147, 86 Cal.Rptr.2d 816, 980 P.2d 371.)

The individual attorney's disqualification extends to his or her entire law firm. (Id. at p. 1146, 86 Cal.Rptr.2d 816, 980 P.2d 371.) "When attorneys presumptively share access to privileged and confidential matters because they practice together in a firm, the disqualification of one attorney extends vicariously to the entire firm. [Citation.] The vicarious disqualification rule recognizes the everyday reality that attorneys, working together and practicing law in a professional association, share each other's, and their clients', confidential information." (Id. at pp. 1153-1154, 86 Cal.Rptr.2d 816, 980 P.2d 371.) Vicarious disqualification not only preserves the confidentiality of client information, it preserves public confidence in the legal profession and the judicial process by enforcing the attorney's duty of undivided loyalty. (Id. at p. 1146, 86 Cal.Rptr.2d 816, 980 P.2d 371; see also Flatt v. Superior Court, supra, 9 Cal.4th at p. 285, 36 Cal.Rptr.2d 537, 885 P.2d 950; Cho v. Superior Court (1995) 39 Cal.App.4th 113, 125, 45...