Opinion
505583/15
07-10-2019
YUAN MING ZHANG, et. al., Plaintiffs, v. ZIANI HICHAM, et. ano., Defendant(s).
Out-going attorney for Plaintiff: Gary S. Park, P.C., 39-01 Main Street - Suite 608, Flushing, NY 11354 Attorney for Plaintiff: David M. Peterson, Esq., 65 Broadway - 8th Fl., New York, NY 10006 Attorney for Defendant: David S. Klausner, Esq., 150 Grand Street - Suite 510, White Plains, NY 10601
Out-going attorney for Plaintiff: Gary S. Park, P.C., 39-01 Main Street - Suite 608, Flushing, NY 11354
Attorney for Plaintiff: David M. Peterson, Esq., 65 Broadway - 8th Fl., New York, NY 10006
Attorney for Defendant: David S. Klausner, Esq., 150 Grand Street - Suite 510, White Plains, NY 10601
Donald Scott Kurtz, J.
Recitation, as required by CPLR § 2219(a), of the papers considered in the review of this motion:
Papers/Numbered
Order to Show Cause/Notice of Motion and Affidavits/Affirmations Annexed 1
Answering Affidavits/Affirmations 2
Reply Affidavits/Affirmations 3
Memoranda of Law
Other
Upon the foregoing cited papers, this motion, by order to show cause, by Gary S. Park, P.C. (hereinafter "Park"), prior counsel for plaintiff Yim Keun Chan (hereinafter "Chan"), for an order: (a) directing David M. Peterson, P.C. (hereinafter "Peterson"), Chan's current counsel, to fully disclose the exact settlement amount of the instant action, for a full accounting of all funds received and attorney's fees earned in this matter, and (b) awarding Park 75% of all attorneys fees earned in this action, or, alternatively, setting a hearing date to apportion the legal fees between Park and Peterson is decided as follows:
On May 6, 2015, Park commenced the instant action, on behalf of Chan and co-plaintiffs Yuan Ming Zhang (hereinafter "Zhang"), You Qin Li, Xu Can Chen and Chun Leung Li, to recover damages for personal injuries allegedly sustained as a result of a motor vehicle accident occurring on February 2, 2015 (Affirmation in Opposition, Exhibit G). At the time of the accident, Zhang was the driver and Chang and the other co-plaintiffs were passengers in the host vehicle. Defendants Hicham Ziani and Garda CL Atlantic, Inc. were the driver and owner, respectively, of the other vehicle involved in the subject accident.
On June 4, 2015, defendants interposed an answer with affirmative defenses but did not include a counterclaim (Affirmation in Opposition, Exhibit H).Notably, defendants asserted, among other things, affirmative defenses that "recovery is barred by [P]laintiffs' culpable conduct and (ii) the damages sustained by Plaintiffs are attributable to the culpable conduct of others" (Affirmation in Opposition, Exhibit H). Subsequently, on December 29, 2016, defendants moved to amend the answer to add a counterclaim against Zhang (Affirmation in Opposition, Exhibit J). A review of the court's e-file record indicates that on January 20, 2017, on behalf of all plaintiffs, Park then cross-moved for an order granting summary judgment in favor of all plaintiffs (NYSCEF, document No. 27). By Consent to Change Attorney dated March 10, 2017, Peterson was substituted for Park as attorney for Chan (Affirmation in Opposition, Exhibit K). By short form order (Toussaint, J.) dated May 24, 2017, "counsel for all plaintiffs" (ie. , Park), with the exception of counsel for Chan, was directed "to resolve any potential conflicts that may exist" (Affirmation in Opposition, Exhibit A). By short form order (Toussaint, J.) dated June 21, 2017, Zhang and the co-plaintiffs were all directed to retain new counsel (Affirmation in Opposition, Exhibit A). The June 21, 2017 short form order further directed that "[p]laintiff driver Yuan Ming Zhang cannot be represented by the same counsel as any of the other co-plaintiffs" (Affirmation in Opposition, Exhibit A). By short form order dated October 25, 2017, among other things, defendants' motion to amend the answer to assert a counterclaim against Zhang was granted (Affirmation in Opposition, Exhibit L). The October 25, 2017 short form order (Toussaint, J.) also denied Zhang's motion for summary judgment on the grounds that there were "issues of fact as to whether plaintiff Zhang bears any liability for the happening of the accident" (id. ).
The parties then engaged in further discovery and motion practice. Thereafter, in May, 2018, the instant action was settled during mediation (Affirmation in Opposition, ¶¶ 16, 68). Jay Margolis, Esq. (hereinafter "Margolis"), Trial Counsel for Peterson, represented Chan during the mediation (id. ). In his Affirmation in Opposition to the instant motion, Peterson states that "the parties entered into a confidentiality agreement at the request of defendants' insurer with regard to the settlement of" Chan's claims (Affirmation in Opposition, ¶ 6).Peterson also submitted the affidavit of Margolis to the Court for an in camera review (Affirmation in Opposition, ¶ 16; exhibit C).
"An attorney who is discharged for cause is not entitled to recover the value of his or her services by way of a ‘charging lien’ pursuant to Judiciary Law § 475" ( Sacco and Fillas, LLP v. Broderick , 133 AD3d 862, 862 [2d Dept 2015], internal citation and quotation marks removed). "The general rule is that an attorney is not entitled to a fee in a personal injury action if the attorney violated the Rules of Professional Conduct (12 NYCRR 1200.0) by representing both the driver of an automobile involved in a collision and a passenger in that vehicle (see Quinn v. Walsh , 18 AD3d 638 [2005] ; Pessoni v. Rabkin , 220 D2d 732 [1995]; see also Doviak v. Finkelstein & Partners, LLP , 90 AD3d 696, 699 [2011] ). Rule 1.7 (a) of the Rules of Professional Conduct ( 22 NYCRR 1200.0 ) provides, in pertinent part, with respect to conflicts of interests involving current clients, that a lawyer shall not represent a client if a reasonable lawyer would conclude that ‘the representation will involve the lawyer in representing differing interests’ (Rules of Professional Conduct [ 22 NYCRR 1200.0 ] rule 1.7 [a][1] ). Pursuant to rule 1.7 (b) of the Rules of Professional Conduct ( 22 NYCRR 1200.0 ) the potential conflict may be waived if the lawyer reasonably believes that he or she will be able to provide competent and diligent representation to each affected client, the representation is not prohibited by law, the representation does not involve the assertion of a claim by one client against the other in the same litigation, and each affected client gives informed consent, confirmed in writing" ( Shelby v. Blakes , 129 AD3d 823, 825 [2d Dept 2015] ).
Based upon a review of the parties' papers, the Court finds that there is an issue of fact regarding whether Park was aware of a potential conflict in simultaneously representing Zhang, as well as, Chan and the co-plaintiffs at the time defendants served the motion to amend the answer to add a counterclaim against Zhang on December 29, 2016. Notably, it was not until March 10, 2017 that Peterson was substituted for Park as attorney for Chan. The Court notes that Peterson's substitution for Park as attorney for Chan was prior to the May 24, 2017 order (Toussaint, J.) directing Park, as counsel for co-plaintiffs, "to resolve any potential conflicts that may exist." Ultimately, the October 25, 2017 short form order (Toussaint, J.) granted defendants' motion to amend the answer to include a counterclaim against Zhang. In light of the foregoing, it is
ORDERED that Park's motion is granted to the extent that the matter is referred to a referee to determine: (1) the existence of a potential conflict, if any, in Park's simultaneous representation of Zhang and Chan prior to Peterson's March 10, 2017 substitution as attorney for Chan; (2) if so, whether the potential conflict was properly waived; and (3) whether Park is entitled to attorneys' fees for its representation of Chan and, if so, an apportionment of same subject to the terms of the confidentiality agreement entered into at the time of settlement of the instant action.
The foregoing shall constitute the Decision and Order of the Court.