A New York State trial court has granted a plaintiff’s motion to disqualify a law firm from representing the defendants, a skate park and its employees, who were sued by the plaintiff after he was injured at the facility.
The court’s decision to disqualify Malapero & Prisco, LLP was based on a conflict of interest that had surfaced in the firm’s dual representation.
The impetus for the litigation was an incident that occurred on March 5, 2007 when Frank Paladino, a roller hockey team member, was participant in a game at Skate Safe, a Skate Safe of America, LLC facility. An altercation broke out between members of the teams and both the plaintiff and defendant Brian Richford, a Skate Safe employee acting as a referee, headed in the direction of the fight. The versions of the events then differ.
Paladino alleged that “he was going to break it up when defendant blocked him and threw him down. Richford contends that the plaintiff appeared to be intent on joining in the fight, and so he impeded and blocked him from doing so.” Either way, as a result of the fall, Paladino sustained an injury.
The legal controversy arose when Skate Park asked the court to reconsider a ruling in which it allowed negligent supervision, negligent training and vicarious liability claims to continue in the case. Instead, it asked the court to find that Richford “was acting outside the scope of his employment at the time of the incident that underlies this law suit, and for that reason Skate Safe should not be held liable.”
The plaintiff argued that that would place “the interests of Richford in opposition to that of Skate Safe, his employer, yet both are represented by the same attorneys. [He further] points out that the motion to reargue does not seek to overturn the Court’s denial of the motion insofar as it sought dismissal of the claims made against Brian Richford, and thus seeks relief only on behalf of Skate Safe. The plaintiff asserted that the position taken by Skate Safe creates a conflict for the attorneys, who represent both the business entities and the individual defendant.”
The Court agreed.
“An attorney should not continue representing two co-parties after a conflict of interest arises between them, because this would result in a violation of the rule requiring attorneys to represent a client zealously, and to preserve client confidences. Sidor v Zuhoski, 261 AD2d 529, 690 N.Y.S.2d 637 (2d Dept. 1999). Indeed, once this conflict becomes apparent, the Court should disqualify the attorney from representing either. Id., at 530; Shaikh v Waiters, 185 Misc 2d 52, 710 N.Y.S.2d 873 (Sup Ct Nassau County 2000). The reason is that the party who is no longer represented by the attorney may already have given confidences to the attorney, and may fear that this could be used against him in some fashion, to the advantage of the remaining client. The concern for maintaining client confidences is cited as a key reason for disqualification for adverse interests. Pellegrino v Oppenheimer & Co., supra, 49 AD3d 94, 98, 851 N.Y.S.2d 19 (1st Dept. 2008), citing Solow v Grace & Co., 83 NY2d 303, 632 N.E.2d 437, 610 N.Y.S.2d 128 (1994).”
The court continued that “client consent may, under appropriate circumstances, provide a basis for permitting continued representation after a conflict arises. 22 NYCRR § 1200.0(b) (Rule 1.7(b)); Shaikh v Waiters, 185 Misc 2d 52, 710 N.Y.S.2d 873, supra. In this case, both affected clients have provided affidavits stating that each has been ‘fully informed by counsel of the implications of the simultaneous representation,’ and each consents. However, the Rule also requires a belief under a ‘reasonable lawyer’ standard that the attorney have a reasonable belief that the attorney ‘will be able to provide competent and diligent representation to each affected client.’ 22 NYCRR § 1200.0(b)(1) (Rule 1.7(b)(1)).
“In this case, the court concludes that such a belief would not be reasonable. The position taken by the defendants that Skate Safe should be free from liability because Richford was acting outside the scope of his employment undoubtedly places the employer’s interests ahead of the individual’s who, as noted above, may be left without insurance coverage. Even if the attorney agreed to continue representation of Richford without charge (an offer not found in the opposition papers), that would not extend to paying for any judgment. It is also worthy of note that the attorney has made no mention of being willing to challenge the insurance carrier on Richford’s behalf in a declaratory judgment action should the carrier make good on its threat to withdraw its defense, nor of avoiding a discussion of Richford’s role with the carrier. In view of the insurer’s threat to discontinue the referee’s defense if it uncovers evidence that he ‘purposely’ injured the plaintiff, communications about Richford carry risk for this client. This is one of those cases in which the dual representation is ‘so fraught with the potential for irreconcilable conflict’ that it cannot be allowed. Greene v Greene, 47 NY2d 447, 451-452, 391 N.E.2d 1355, 418 N.Y.S.2d 379 (1979).”
Frank Paladino v. Skate Safe, Inc., et al.;. S.Ct.N.Y., Nassau County; INDEX NO.: 3252/08, 2010 NY Slip Op 32090U; 2010 N.Y. Misc. LEXIS 3686; 7/29/10
Attorneys of Record: (for plaintiff) Matthew D. Shwom, Esq., Lewis Johs Avallone Aviles, LLP., Melville, NY. (for defendants) Malapero & Prisco, LLP, By: Andrew L. Klauber, Esq, , New York, NY.
