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permitting withdrawal even though no substitute counsel had been retained
Summary of this case from Fitt Highway Prods., Inc. v. Sacks MotorSports, Inc.Opinion
97 Civ. 3830 (HB) (THK)
May 9, 2001
MEMORANDUM OPINION AND ORDER
This action, involving the loss of shipping cargo, was referred to me by the Honorable Harold Baer, Jr., for a hearing on damages. In the course of providing pre-hearing submissions on damages, defendant's counsel, the firm of Snow Becker Krauss P.C. ("SBK"), moved to withdraw as counsel, pursuant to Local Civil Rule 1.4 of the Southern District of New York. For the following reasons, the motion is granted.
BACKGROUND
Plaintiff, Federal Insurance Company, as the subrogated underwriter of New England Circuit Sales d/b/a/ NECX, commenced this action against Yusen Air Sea Service(s) Pte. Ltd. d/b/a/ Yusen Air Cargo ("Yusen"), seeking damages for the non-delivery of cargo pursuant to the Convention for the Unification of Certain Rules Relating to International Transportation by Air, commonly known as the Warsaw Convention. The District Court (Baer, J.) granted Yusen's cross-motion for partial summary judgment limiting Yusen's liability to Federal Insurance, if any, to the amount of $380, pursuant to Article 22 of the Warsaw Convention. See Federal Insurance Co. v. Yusen Air Service(s) Pte. Ltd. d/b/a/ Yusen Air Cargo, No. 97 Civ. 3830 (HB), 1998 WL 477987, at *6 (S.D.N.Y. Aug. 14, 1998). In a subsequent decision, the Court granted plaintiff's motion for summary judgment, holding Yusen liable for the loss of NECX's cargo in the amount of $380. See Federal Insurance Co. v. Yusen Air and Sea Service(s) Pte. Ltd. d/b/a Yusen Air Cargo, No. 97 Civ. 3830 (HB), 2000 WL 280020, at *5 (S.D.N.Y. Mar. 14, 2000). On appeal, the Second Circuit reversed the district court's judgment, holding that because Yusen's air waybill did not satisfy the requirements of Article 8(c) of the Warsaw Convention, Yusen was not entitled to the limitation of liability contained in Article 22(2) of the Convention. See Federal Insurance Co. v. Yusen Air Sea Service(s) Pte. Ltd. d/b/a Yusen Air Cargo, 232 F.3d 312, (2d Cir. 2000). The case was remanded for a determination of damages, and that matter was subsequently referred to the undersigned.
On February 16, 2001, the Court held a telephone conference to review the status of the matter and schedule proceedings on the issue of damages. During that conference, William D. Hummell, Esq., an attorney with SBK, advised the Court that neither he nor any other attorney then employed by SBK had any prior involvement in the action or any communication with defendant Yusen. The only SBK attorneys who had a relationship with Yusen were Alan Van Praag and Michael Hardison, both of whom left SBK in January 2001 and relocated to another firm. Although Van Praag and Hardison attempted to communicate with representatives of Yusen to advise them of their relocation and to receive direction on representation in this action, they had received no responses to their communications. At the conference, SBK advised the Court of its intention to file a motion to withdraw as counsel.
In an Order, dated February 16, 2001, the Court directed plaintiff to submit proposed findings with respect to its damage claims by March 2, 2001. The Order provided that a response be submitted by defendant by March 23, 2001, on the assumption that in the intervening period Yusen would have the opportunity to make a determination as to its representation in this action. Nevertheless, Yusen failed to respond to a letter sent by SBK on February 23, 2001, seeking instructions on representation. SBK's motion to withdraw as counsel followed.
DISCUSSION
Local Civil Rule 1.4 of the Southern District of New York requires that an attorney obtain leave of the Court to withdraw as attorney of record, and provides that leave may be granted "only upon a showing by affidavit or otherwise of satisfactory reasons for withdrawal or displacement and the posture of the case, including its position, if any, on the calendar." S.D.N.Y. Local Civ. R. 1.4.
In the present case, counsel of record, SBK, avers that from the inception of this case the only two attorneys who had a relationship with and represented Yusen's interests in this litigation were Alan Van Praag and Michael O. Hardison. Indeed, they were the only members of SBK with an expertise in the overseas carriage of goods and carriage of goods by air. See Affirmation of Edward M. Cuddy, III In Support of Motion of Snow Becker Krauss P.C. to Withdraw as Attorneys of Record for Defendant, dated February 27, 2001 ("Cuddy Aff."), ¶¶ 5-6. Messrs. Praag and Hardison resigned from SBK on January 8, 2001 and arranged to have most of their clients deliver to SBK letters of instruction with regard to pending matters, presumably directing that representation be transferred to their new law firm, Eaton Van Winkle. Although such a communication had been forwarded to Yusen, neither Hardison, Van Praag or SBK has received a response from Yusen. See Cuddy Aff., ¶ 11. Because SBK's representation of Yusen had originated from a Singapore law firm, Niru Co. ("Niru"), and all communications on behalf of Yusen were received from or directed to Niru, on at least four different occasion after leaving SBK, either Hardison or Van Praag communicated with Niru in an effort to obtain instructions on how Yusen wished to proceed. No response was received. Further, while in Singapore in February, Van Praag unsuccessfully attempted to secure instructions from Niru. See Declaration of Alan Van Praag, dated February 28, 2001, attached as an exhibit to the Reply Affirmation of Edward M. Cuddy, III, dated March 2, 2001. Finally, SBK delivered to Yusen, through Niru, by facsimile and Federal Express, a copy of the Court's February 14, 2001 Scheduling Order setting forth the dates for the parties' submissions on the issue of damages. SBK advised Yusen of its intention to file a motion to withdraw as counsel and strongly recommended to Yusen that it immediately retain counsel so that it could comply with the Court's Order and protect its rights in this litigation. See Cuddy Aff., ¶¶ 16-17 and Exhibit B. No response was received, nor has the Court received any submissions on behalf of Yusen.
In further support of its motion to withdraw, SBK cites the fact that Yusen owes it fees and disbursements in the amount of $43,748.52, and that despite repeated demands for payment, other than a nominal payment in May 1999, no other monies have been received from Yusen. See Cuddy Aff., ¶¶ 18-19 and Exhibit C.
In light of this record, which is uncontested, the Court sees no reason to deny counsel's motion for withdrawal. It is well established that lack of cooperation and communication by a client and refusal to pay fees are sufficient reasons for granting withdrawal. See Technology Express, Inc. v. FTF Business Systems Corp., No. 99 Civ. 11692 (GEL), 2000 WL 1877020, at *7 (S.D.N Y Dec. 26, 2000); Promotica of America, Inc. v. Johnson Grossfield, Inc., No. 98 Civ. 7414 (AJP), 2000 WL 424184, at **1-2 (S.D.N Y Apr. 18, 2000); Worldvision Enterprises, Inc. v. Ricklis Broadcasting Corp., No. 95 Civ. 10253 (HB) (NRB), 1996 WL 148340, at *1 (S.D.N.Y. Apr. 2, 1996); Seisay v. Compagnie Nationale Air France, No. 95 Civ. 7660 (JFK) (AJP), 1996 WL 38844, at *1 (S.D.N Y Feb. 1, 1996); Furlow v. City of New York, No. 90 Civ. 3956 (PKL), 1993 WL 88260, at *2 (S.D.N.Y. Mar. 22, 1993)
The relationship between SBK and its client precludes effective representation and justifies withdrawal. The only attorneys at SBK with whom Yusen had a relationship are no longer at the firm. There are presently no attorneys at SBK who practice in the field of law out of which this action arises. More importantly, there has been a complete breakdown in communication between Yusen and its attorneys. Yusen has failed to respond to counsel's inquiries and has provided no instructions on the issues of representation and how it wishes to proceed in this action. Moreover, SBK has incurred substantial fees and costs on behalf of Yusen, and over the period of twenty months has received neither a partial payment nor a promise of future payment.
Accordingly, Snow Becker Krauss' motion to withdraw as counsel for Yusen is granted. Yusen, as a corporation, may not proceed in this actionpro se. See Rowland v. California Men's Colony, Unit II Men's Advisory Council, 506 U.S. 194, 201-02, 113 S.Ct. 716, 721 (1993); Pridgen v. Andresen, 113 F.3d 391, 393 (2d Cir. 1997); Iannaccone v. Law, 142 F.3d 553, 558 (2d Cir. 1995); Dial-A-Mattress Franchise Corp. v. Page, 880 F.2d 675, 677 (2d Cir. 1989) Dow Chem. Pac. Ltd. v. Rascator Maritime S.A., 782 F.2d 329, 336 (2d Cir. 1986); Souzhou Textiles Import Export v. Swell Fashions, No. 96 Civ. 1386 (BSJ), 1997 WL 13224, at *1 (S.D.N.Y. Jan. 15, 1997) Yusen shall therefore be allowed until June 7, 2001 to retain new counsel and to file a response to plaintiff's request for damages. Failure to have an attorney enter a notice appearance on its behalf and to submit papers in opposition to plaintiff's request for damages, by June 7, 2001, may result in the entry of a default judgment against Yusen, and plaintiff's request for damages shall be decided by the Court, which shall view it as unopposed. Cf. Dow Chem. Pac. Ltd., 782 F.2d at 336; Arch Assocs., Inc. v. HuAmerica Int'l, Inc., No. 93 Civ. 2168 (PKL), 1994 WL 319257, at *1 (S.D.N.Y. June 29, 1994); Farberware, Inc. v. Groben, No. 89 Civ. 6240 (PKL), 1991 WL 8506, at *2 (S.D.N.Y. Jan. 22, 1991).
Although Yusen has apparently already been advised of the Court's Order requiring submissions on the issue of damages, and has failed to submit any opposition to plaintiff's request for damages, because of the situation involving the withdrawal of counsel, the Court will allow Yusen one more opportunity to respond on the damages issue.
SBK is hereby ordered to promptly serve a copy of this Order and of plaintiff's damages submissions on Yusen, and shall provide proof of such service to the Court.
So ordered.