Summary
In Center Associates v. Superior Court (Nov. 4, 2008, D053469 [nonpub. opn.]), we granted a petition by Center for a writ of mandate, ordering the superior court to vacate its order granting the motion to disqualify Center's counsel and to enter a new order denying the motion.
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NOT TO BE PUBLISHED IN OFFICIAL REPORTS
Petition for writ of mandate from an order of the Superior Court of San Diego County, Charles R. Hayes, Judge, San Diego County Super. Ct. No. 37-2007-00069346-CU- MC-CTL
HUFFMAN, Acting P. J.
This writ proceeding arises from an order disqualifying a law firm from representing its clients, petitioners Center Associates, L.P., et al. (petitioners or Center), due to a finding of impermissible successive representation of an opponent of Center. Center has sued the owners of 48 units in a condominium project and their homeowners' association, seeking declaratory relief to interpret the governing documents affecting the owners' property. Center is planning to develop commercial property that it owns adjacent to the residential condominium project, including Center's Lot 4, on which the owners have various access and easement rights for parking from their lots 5 and 6.
The real parties in interest, defendants and real parties, Betty Joan Maly and her husband John C. Meyers (sometimes both referred to as Maly; both are medical doctors), own one of the condominium units. Maly brought a motion to disqualify the law firm that represents Center, Procopio, Cory, Hargreaves & Savitch, LLP (the law firm or Procopio), on the basis that the same law firm previously represented Maly in connection with her 1985 purchase of her unit, before her marriage to Meyers. Meyers joined in the motion, asserting that confidential information had been obtained from both Maly and Meyers during the law firm's representation of them in various unrelated business matters from 1990 through 1999. The trial court granted the motion to disqualify, and Center seeks writ relief to keep the counsel of its choice.
To challenge the order of disqualification, petitioners contend there is no substantial relationship between the 1985 representation of Maly, or the later representation of the couple in unrelated tax and business matters, and the current controversy and the law firm's representation of Center in it. Petitioners also claim the requests to disqualify them were not made in a timely manner and have caused prejudice to their clients. Petitioners have brought a motion seeking an order from this court that a different trial judge should be appointed for further proceedings. (Code Civ. Proc., § 170.1, subd. (c).)
Although we find the attorney disqualification requests were made in a reasonably timely manner, we agree with the law firm that the trial court erred in finding there was a substantial relationship between the two successive representations, the 1985 retention during Maly's purchase of the condominium, and the current lawsuit over easement and development rights and duties. Likewise, the intervening representation of the couple in unrelated tax and business matters was not shown to give rise to any actual or presumed disclosure of confidential information materially affecting this action.
Nevertheless, despite this legal error by the trial court, there is no basis whatsoever to grant Center's current motion to transfer the matter to another trial judge. At all times, as shown in the record, the matter was correctly treated as raising legal issues that were ruled upon in due course, without any indication of prejudice. The petition will be granted but the motion to transfer will be denied.
FACTUAL AND PROCEDURAL BACKGROUND
A. Nature of Proceedings
The underlying litigation involves a dispute between adjacent owners within six lots of real property in the Sea Canyon condominium project. Both commercial and residential condominium units were built there in the early 1980's. All the residential condominium units are located on lots 5 and 6, and access to their property, parking, and utilities are provided by easements over Lot 4. The residential units have no public street frontage. Maly and Meyers are two individually named defendants whose family trust owns one of the 48 residential units in the condominium project.
Center owns commercial property adjacent to the residential condominium property, lots 1, 2, 3 and 4, and has been seeking to redevelop it since 2001, to add a parking garage on Lot 4, among other things. Center's commercial development is a medical-dental office building complex (commercial condominiums). The commercial complex was constructed pursuant to a City of San Diego Planned Commercial Development Permit No. 72 (Permit 72), approved September 27, 1979. Permit 72 requires that at least 215 offstreet parking spaces shall be provided and maintained on the property, referring to a map, "and shall be permanently maintained and not converted for any other use."
Originally, Lot 4 was owned by the homeowners, through their master association. That master association was created by, and the condominium project governed by, a 1981 set of CC&R's, filed when the homeowners' association was incorporated (1981 CC&R's). The master association originally held title to Lot 4, a parking area used by the homeowners, over which they retained easement and access rights from their homes on lots 5 and 6. In 1992, the homeowners revised and restated the CC&R's to allow them to dissolve the master association and to sell Lot 4 to Center's predecessor, "Fontenoy Tower Apartments," subject to restrictions in the grant deed as stated in the restated declaration of restrictions (here, 1992 CC&R's), regarding parking, easements for access, and other uses. Throughout 1990 to 1992, the various homeowners signed their agreements to the dissolution of the master association and its transfer of Lot 4 to Center's predecessor, with various access rights reserved in their agreements. Lot 4 has continued to be used as a parking and access area for the condominium project, as well as the business owners, and extensive disputes over its use have developed.
Other defendants/homeowners in the development are not parties to this writ, nor is the defendant Sea Canyon Homeowners' Association. We refer to these nonparties as the other homeowners or the Association, respectively.
The 1992 CC&R's were recorded by the HOA's then-attorneys (a different law firm, Epsten Grinnell & Howell, APC). In connection with those transactions, Lot 4 was conveyed to petitioners (its predecessor, "Fontenoy Tower Apartments"), and the grant deed refers to the restrictions set forth in the 1992 CC&R's, including easements and conditions such as access rights. The 1992 CC&R's incorporate Permit 72 at paragraph 2.5: "Any Owner may delegate his or her right of enjoyment to the Parking Area and facilities thereon to the members of his or her family, tenants, guests, invitees and/or contract purchasers, subject to the Planned Commercial Development Permit No. 72 . . . ." Additionally, the 1992 CC&R's deal with parking issues in a seemingly different manner, at paragraphs 2.3 and 2.4, by allowing the parking and access easements to be "subject to reasonable regulation as hereinafter provided." Paragraph 3.3 of the 1992 CC&R's provides that the residential owners' consent must be obtained for any changes to the parking access and number of spaces, pursuant to Permit No. 72.
The standard general conditions of Permit No. 72 provide, in pertinent part: "This planned commercial development permit shall inure to the benefit of and shall constitute a covenant running with the lands, and the terms, conditions and provisions hereof shall be binding upon Permittee, and any successor or successors thereto, and the interests of any successor shal1 be subject to each and every condition herein set out." (Permit 72, para. 10.)
Evidence in the record shows that the month before Permit 72 was approved in 1979, a memo was written by a representative of the City of San Diego's engineering and development department, to the City's planning department, noting that "[t]his development is providing no guest parking for the residential units and is providing only 1.6 spaces for each two-bedroom residential unit. This is considerably under our normal requirements for a planned residential development, but it is felt that the availability of the commercial parking will adequately make up for this deficiency."
B. Legal Representation of Real Parties by Procopio
In 1985, Maly retained an attorney formerly with the Procopio law firm, Antonia Martin, to assist her in researching title and purchasing residential condominium unit 2-D. The record includes 13 pages of handwritten notes that Martin compiled about the work she performed for Maly, and a bill for $437.50. Attorney Martin initially disapproved of the deed for the condominium because a specific parking spot on Lot 4 was not included, and the deed was rewritten. Some time later, Maly married Meyers, and their family trust holds title to the condominium unit.
From 1990 through 1999, other partners in the law firm were retained by Meyers for several unrelated business, tax, partnership and/or corporate matters. In 1994 and 1995, the law firm represented both Maly and Meyers in a tax matter concerning another partnership, and the purchase of a different business. Attorney Martin has left the firm.
C. Filing and Progress of Two Actions by Center
In February 2006, Center brought the first of two actions to obtain a judicial determination of rights and duties under the 1992 CC&R's, with respect to certain disputes about the extent of the homeowners' easement and parking rights on Lot 4. (Code Civ. Proc., § 1060 et seq.) Center wants to develop Lot 4 and proposes to construct an underground parking garage there, affecting those rights. At that time, Center was represented by counsel other than Procopio. Ultimately, in the first action, the trial court determined at the continued status conference that not all of the indispensable parties had been served. It accordingly dismissed the entire first complaint without prejudice, effective March 27, 2007. The dismissed homeowner defendants have appealed a subsequent denial of their motion for attorney fees, and that appeal is pending. (Center Associates v. Altman, et al. (No. D051583).) In October 2007, Procopio substituted in as counsel for Center in that appeal.
On June 29, 2007, Procopio, acting for Center, filed a second complaint under a new case number (this action), against Maly, Meyers, and the other owners. This action added several new defendants who had been recently located as owners of units within the condominium project. In general, Center made the same and added more allegations about the proper interpretation of the 1992 CC&R's with respect to any regulation of easement rights. Center seeks judicial interpretation on whether and to what extent it must obtain approval from the homeowner defendants for the proposed development, the extent of the regulation of parking on Lot 4 that it can exercise, and the applicability of zoning and parking regulations to homeowners, including Permit 72.
The homeowners answered and filed a cross-complaint seeking damages for breach of contract, invasion of privacy, and alleging RICO violations. The cross-complaint was amended to add more theories, and the trial court bifurcated trial upon the two pleadings.
Center brought an anti-SLAPP motion to strike the cross-complaint, as amended. (Code Civ. Proc., § 425.16.) On June 6, 2008, the trial court denied the motion and Center immediately appealed. (Center Associates v. Altman, et al. (D053266) [this court has stayed that briefing schedule pending the conclusion of these writ proceedings].)
Petitioners seek judicial notice of the appellate records on file in the two other appeals in this matter "to the extent deemed necessary." (Evid. Code, §§ 452, 459.) This court has the ability to control its own calendar and has taken the status of the other cases into account "to the extent deemed necessary."
D. Motion to Disqualify
After the law firm filed the second action in June 2007, Maly answered the complaint. Maly's attorney (also attorney for most of the other homeowners) wrote a letter in September 2007, objecting to the law firm's participation on behalf of Center in the action, on the grounds that the law firm had previously represented Maly in connection with her 1985 purchase of the unit in the same complex. In September of 2007, members of Maly's family, including Meyers, had significant health issues with which she was dealing.
The resulting events, including the law firm's response to the request for disqualification, are well summarized by the trial court in its ruling:
"On October 17, 2007, Procopio responded that 'based on your representation that this firm previously represented Ms. Maly, we recently determined that' the firm had in fact represented the Doctor in her purchase of the Sea Canyon condo unit. In February, 2008 during the Case Management Conference the conflict was again raised along with the conflict arising from Procopio's former representation of Dr. Meyers. In March 2008, Dr. Meyers made his general appearance in this action and the Procopio firm denied the existence of any conflict. Whereupon in April 2008, defendant Doctors subpoenaed their files. Procopio filed its Anti-SLAPP motion thereby staying discovery until June 6, 2008 when the Court issued its Final Ruling After Oral Argument. Also, in April Dr. Maly filed her motion to disqualify. Procopio produced seven (7) client files in May 2008 and Dr. Meyers filed his motion to disqualify. Center Associates has offered no evidence that these actions taken by the plaintiff and the defendants have caused any prejudice [to Center]."
Maly's motion to disqualify was set for hearing June 20, 2008, along with the joinder by Meyers. In support of her motion, Maly provided a declaration outlining her consultation of the law firm's former attorney Martin in 1985, to "perform a real property assessment of the above condominium and the Sea Canyon complex for me in 1985-1986. The assessment included research of the title, review of the condominium function as expressed in the CC&Rs, including egress, ingress, parking carports and use of Lot 4. As part of my request, Ms. Martin and her partners researched any history of prior lawsuits and issues regarding structural stability which might affect the value of the property. The rights that I have for the use of Lot 4, from condominium documents established in 1981, are the same as those reaffirmed as recorded easements for use of Lot 4, when the Amended Declaration transactions were made with the transfer of ownership of Lot 4 in 1992 . . . . [¶] . . . Ms. Martin's work at Procopio had assured me that in my purchase of a Sea Canyon condominium unit and participation in the association I had title, with existing rights for utilities, ingress, egress, parking, the carport, and use and enjoyment of Lot 4, which also serves as landscape and a physical separation of commercial activity from our residential area at Sea Canyon condominiums."
The law firm objected to the italicized portion of Maly's declaration about her remaining property rights as constituting a legal conclusion, made without foundation. This objection is renewed on appeal and will be addressed in the discussion portion of this opinion.
In support of the motion, Maly provided Attorney Martin's file notes showing the following work: "1. An initial one and .5 hour meeting with Dr. Maly on 8/8/85; [¶] 2. Work performed on 8/9/85 without reference to time; [¶] 3. 8/29/85 additional work .5 hours; [¶] 4. 9/3/85 additional work regarding parking, .3 hours; [¶] 5. 9/20/85 additional work without reference to time and [¶] 6. 10/9/85 additional work without reference to time."
The showing also included Meyers's statement that in 1990, he retained the law firm on an unrelated limited partnership matter. Between 1994 and 1995 different attorneys in the law firm represented Maly and Meyers in various other property and tax matters, and in 1999, they represented Meyers in tax matters.
In her declaration, Maly described the subject of the research performed by Attorney Martin in 1985 as including the title documents and the complex's legal and structural history. Both she and Meyers referred to the filing of a lis pendens on their condominium unit in the spring of 2008, as clouding their title, and they express their disillusionment with the legal system because of the actions of this law firm in now suing them.
Opposition was filed by petitioners, through the law firm, arguing the current facts and issues are only tangential to and therefore not substantially related to the 1985 real estate assessment that was performed by its attorney. Petitioners argued no confidential information would be compromised by this representation, and in any case, Maly and Meyers had unreasonably delayed in bringing this motion (from September 2007 until obtaining the original hearing date, which was later continued to July 2008, following supplemental briefing that the court requested about the effect of Permit 72). Reply papers were filed and the court held oral argument.
E. Ruling
In its order, the trial court first overruled all evidentiary objections (except one not relevant here, involving the Association's filing of an amicus brief). In particular, the law firm's objection noted above was overruled (that Maly's declaration contained a legal conclusion about her rights under the various governing documents).
The trial court granted the motion to disqualify, stating that Maly had established a substantial relationship between the law firm's former representation of her in 1985, and the issues presented in the current case. The court determined that the law firm should be precluded from representing Center on these issues, because Center is now acting in opposition to its former clients. The trial court also relied on evidence that both Maly and Meyers had provided the law firm with confidential personal financial information (including tax information, tax identification numbers and property holdings).
The ruling relied on both the 1985 Maly representation and also the more recent provision of confidential information by the couple to members of the law firm, in connection with the tax and partnership matters (1990-1999). For this reason, we disagree with the statement in the petition that the trial court provided "no analysis," regarding Meyers, on whether disqualification was warranted. However, we agree that the 1990-1999 representations were on different subject matters, and therefore, the main focus should remain upon whether a substantial relationship between the 1985 condominium purchase representation and the current litigation has been shown to exist. (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) 20 Cal.4th 1135, 1143-1145 (SpeeDee Oil).)
The trial court made further findings that Center's assertion that the owners "unreasonably delayed" in bringing this motion was not supported by the facts. Center filed this petition, and this court issued an order to show cause why relief should not be granted. Oral argument was waived. Petitioners have filed a motion in this court, to be decided by this panel, seeking an order requiring transfer of the case to a new trial judge.
DISCUSSION
I
INTRODUCTION
The disqualification motion was brought on the ground that the law firm had formerly represented Maly in a substantially related real estate transaction and other matters, and as a result, should be presumed to have had access to confidential information material to this action. These issues arise under rule 3-310(E) of the Rules of Professional Conduct, providing that an attorney "shall not, without the informed written consent of the client or former client, accept employment adverse to the client or former client where, by reason of the representation of the client or former client, the member has obtained confidential information material to the employment." (Rules Prof. Conduct, rule 3-310(E), hereafter rule 3-310(E).)
Center has been seeking to develop its properties since 2001, and this case was filed in June 2007. Trial has been set for November 7, 2008 on the declaratory relief claim. It is appropriate for this court to review this petition for writ of mandate in challenge of the disqualification ruling, to determine the correctness of the trial court's legal determinations on the motion. (Reed v. Superior Court (2001) 92 Cal.App.4th 448, 455.) The subject ruling may effectively deprive the petitioners of counsel of their choice, both as to the underlying case in the trial court and two pending appeals. Pretrial writ proceedings are appropriate to assess the trial court's exercise of discretion in its application of governing legal principles. (SpeeDee Oil, supra, 20 Cal.4th 1135, 1143-1144 .)
In the attorney fee matter in the original case, Center was originally represented by other counsel, and this law firm did not begin representing Center until the appeal, October 2007. (Center Associates v. Altman, et al. (D051583).) That matter was fully briefed and will be orally argued after the resolution of this disqualification issue. Likewise, the briefing in the anti-SLAPP appeal by Center has been stayed while this petition is pending. (Center Associates v. Altman, et al. (D053266).)
As a preliminary matter, we reject the argument by petitioners that Maly and Meyers somehow forfeited any claim that disqualification of the law firm would be appropriate, through some unreasonable delay on their parts in raising their objections to continued representation of Center by the law firm. Center filed the complaint on June 29, 2007 and amended it July 17, 2007. Within weeks of Maly's general appearance in the action, petitioners were informed of her objections to successive representation by her attorney, when he called and wrote the firm in September 2007. Maly had some trouble finding her documents regarding the 1985 representation by the law firm, and was delayed by Meyers's illness and her son's illness. The law firm told her attorney that there was no conflict of interest, but it apparently did not review its files to determine the extent of its previous representation of Maly and Meyers.
The issue was again raised in the trial court at a case management conference in February 2008. After the subpoena process was carried out, the motion to disqualify and joinder were filed in April and May 2008. Maly and Meyers acted in a reasonably timely manner under the circumstances, considering the health problems involved and the uninformative response they had received about obtaining the relevant records. The adverse successive representation issues have been adequately preserved by Maly and Meyers, and expeditious review is appropriate. (See Zador Corp. v. Kwan (1995) 31 Cal.App.4th 1285, 1302.)
II
APPLICABLE STANDARDS
A trial court's ruling on a disqualification motion is reviewed for abuse of discretion, and we accept as correct all express or implied findings that are supported by substantial evidence. (SpeeDee Oil, supra, 20 Cal.4th at 1143-1145.) "However, the trial court's discretion is limited by the applicable legal principles. [Citation.] Thus, where there are no material disputed factual issues, the appellate court reviews the trial court's determination as a question of law. [Citation.] In any event, a disqualification motion involves concerns that justify careful review of the trial court's exercise of discretion. [Citation.]" (Id. at p. 1144.) A trial court has abused its discretion where it has applied an incorrect legal standard. (McPhearson v. Michaels Co. (2002) 96 Cal.App.4th 843, 851; Farris v. Fireman's Fund Ins. Co. (2004) 119 Cal.App.4th 671, 689 (Farris).)
Disqualification motions involve a conflict between clients' rights to counsel of their choice and the need to maintain ethical standards of professional responsibility. "The paramount concern is the preservation of public trust in the scrupulous administration of justice and the integrity of the bar." (Jessen v. Hartford Casualty Ins. Co. (2003) 111 Cal.App.4th 698, 705-708 (Jessen).) This concept is sometimes broadly stated as prohibiting an attorney or law firm from doing " 'anything which will injuriously affect his former client.' " (People ex rel. Deukmejian v. Brown (1981) 29 Cal.3d 150, 155, quoting Wutchumna Water Co. v. Bailey (1932) 216 Cal. 564, 573-574.) The legal standards for determining whether attorney disqualification must be ordered will require the application of a number of criteria, with attention to whether the challenged representation is simultaneous or successive, and within the context of identified policy concerns.
In Flatt v. Superior Court (1994) 9 Cal.4th 275, 283 (Flatt), the Supreme Court distinguished among the circumstances in which attorney disqualification problems may arise, and stated that separate interests underlie the relevant ethical concerns, and therefore two distinct tests have been formulated for simultaneous versus successive representation cases. We reiterate that this is a successive representation case, in which the policy concerns of preserving client confidentiality are primarily implicated. By contrast, in simultaneous representation cases: "The primary value at stake in cases of simultaneous or dual representation is the attorney's duty--and the client's legitimate expectation--of loyalty, rather than confidentiality." (Id. at p. 284.) The test that applies to simultaneous representation is more stringent than that applicable to successive representations. (Ibid., Rule Prof. Conduct, rule 3-310(C).) In SpeeDee Oil, supra, 20 Cal.4th 1135, 1146-1147, the Supreme Court applied the rules for analyzing attorney-client confidentiality issues in a simultaneous representation case, in light of the "distinct fundamental value of our legal system [that] is the attorney's obligation of loyalty. Attorneys have a duty to maintain undivided loyalty to their clients to avoid undermining public confidence in the legal profession and the judicial process. [Citation.] The effective functioning of the fiduciary relationship between attorney and client depends on the client's trust and confidence in counsel. [Citation.] The courts will protect clients' legitimate expectations of loyalty to preserve this essential basis for trust and security in the attorney-client relationship." (Ibid.)
In the case before us, the law firm's representation of Maly in the 1985 purchase of the condominium was a transactional matter that dealt with the adequacy of title, generally including parking issues. In Maly's and Meyers's declarations, they refer to their disappointment that they are now being sued by a law firm that previously represented them, and they complain that the firm clouded their title by recording a lis pendens. In their opposition, they define the subjects of the successive representations overly broadly, as both relating to "title," as will be explained. However, even though their subjective disappointment and opinions about the loyalty that they believe should have been owed to them are no doubt sincere, those factors do not necessarily control or enter into the applicable standards for evaluating whether there was improper successive representation, if there was no improper opportunity for breaches of confidentiality about the material issues previously litigated.
Therefore, although there is evidence in this record that Maly and Meyers expected continued loyalty from the law firm over the years, based on the previous representation circumstances, those concerns in this factual context (successive representation) are only general in nature, and are not dispositive. The duty of loyalty, a distinct fundamental value of the legal system, is grounded in confidentiality issues and therefore must be subordinated in this case to the confidentiality problems addressed by the applicable test. (See Flatt, supra, 9 Cal.4th at p. 284; SpeeDee Oil, supra, 20 Cal.4th 1135, 1146-1147.)
III
CRITERIA: SUCCESSIVE REPRESENTATION
In a successive representation case, in which a former client seeks to have a previous attorney disqualified from serving as counsel to a successor client in litigation that is adverse to the interests of the original client, "the governing test requires that the client demonstrate a 'substantial relationship' between the subjects of the antecedent and current representations." (Flatt, supra, 9 Cal.4th at p. 282; SpeeDee Oil, supra, 20 Cal.4th at p. 1146.) "Where an attorney successively represents clients with adverse interests, and where the subjects of the two representations are substantially related, the need to protect the first client's confidential information requires that the attorney be disqualified from the second representation. [Citation.]" (Ibid.)
As explained in H.F. Ahmanson & Co. v. Salomon Brothers, Inc. (1991) 229 Cal.App.3d 1445 (Ahmanson), the resolution of successive disqualification issues goes beyond discerning the ordinary meaning of the words "substantial" and "relationship," to an examination of "the practical consequences of the attorney's representation of the former client. The courts ask whether confidential information material to the current dispute would normally have been imparted to the attorney by virtue of the nature of the former representation. [Citation.]'' (Id. at p. 1454.)
This approach, from Ahmanson, "requires two separate inquiries in determining whether an attorney ought to be disqualified in a successive representation case--the nature of the relationship between the former representation and the current representation and the nature of the attorney's past relationship with the former client. [Citation.]" (Farris, supra, 119 Cal.App.4th 671, 679-680, citing Ahmanson, supra, 229 Cal.App.3d at p. 1453.)
This practical approach does not depend on the specific identity of the tasks or services performed by the attorney for the former client, but rather on "the similarities between the legal problem involved in the former representation and the legal problem involved in the current representation." (Jessen, supra, 111 Cal.App.4th at pp. 709, 711-714.) The question should be whether the subject matters, facts or issues are substantially the same, between the prior and current relationships. (Flatt, supra, 9 Cal.4th at pp. 282-285; Ahmanson, supra, 229 Cal.App.3d at p. 1455.) "The ethical rules recognize that the interest of the former client is to ensure 'permanent confidentiality of matters disclosed to the attorney in the course of the prior representation.' [Citation.]" (Farris, supra, 119 Cal.App.4th 671, 681-682, citing Flatt, supra, at p. 283.) However, "to apply the remedy of disqualification 'when there is no realistic chance that confidences were disclosed would go far beyond the purpose of the substantial relationship test.' " (Ahmanson, supra, 229 Cal.App.3d at p. 1455.) If the lawyer can show that there was no opportunity for confidential information to be divulged, no such presumption will arise; however, this "limited exception is not available when the lawyer's former and current employment are on opposite sides of the very same matter or the current matter involves the work the lawyer performed for the former client." (City National Bank v. Adams (2002) 96 Cal.App.4th 315, 327-328 (City National Bank).)
We will initially note that no prejudicial evidentiary error occurred when the trial court overruled the law firm's objection to that portion of Maly's declaration that summarized her beliefs about the extent of her remaining property rights, as follows: "The rights that I have for the use of Lot 4, from condominium documents established in 1981, are the same as those reaffirmed as recorded easements for use of Lot 4, when the Amended Declaration transactions were made with the transfer of ownership of Lot 4 in 1992." (Italics added.) The entire record discloses that the trial court obviously understood and addressed the subject issues as presenting legal questions about any substantial relationship between the two representations, not the merits or facts of the underlying legal dispute about easements, transfer of Lot 4, etc. Therefore, that evidentiary ruling, even though subject to question because of the legal conclusions set forth in the declaration, could have had no prejudicial effect.
Further, the mere passage of time between the two representations is not necessarily a relevant or dispositive factor. In Farris, the court explained, "We certainly can envision circumstances where the passage of time might be shown to have eliminated a prior substantial relationship due to such events as changes in corporate structure, turn over in management, and the like." (Farris, supra, 119 Cal.App.4th 671 at p. 686.) However, those facts concerning the passage of a long period of time were not present in Farris, and they are likewise not necessarily significant in this case, where the substantive nature of the representation and related criteria must instead be examined.
IV
APPLICATION OF RULES
A. Substantial Relationship Factors
With these principles in mind, we compare the nature of the representation provided earlier, to the scope of that being carried out in the current controversy, and examine the similarities between the factual situations and the legal questions posed. We seek to determine whether the trial court was justified in finding that the nature and extent of the attorney's involvement in the first case was such that confidential information material to the current dispute would normally have been imparted to the attorney, and must be presumed to have been conveyed, or instead, if there was no opportunity for doing so. (Brand v. 20th Century Ins. Co. (2004) 124 Cal.App.4th 594, 601-605.)
Case law has established a number of considerations that go into this analysis, of whether the two engagements arose in essentially the same context and shared the critical factual and legal elements. First, the risk of any disclosure of confidential information must be assessed. In Kirk Corp. v. First American Title Co. (1990) 220 Cal.App.3d 785, 804, 813, the facts were that an attorney in a law firm representing the defendant had once worked for the plaintiffs (prepared CC&R's for the same condominium project where the current litigants were located). However, such prior representation was held not to be grounds for disqualification because the current litigation involved materially different issues (a lease and escrow dispute). There was "no evidence to suggest that by virtue of its advice on the CC&R's defendant's law firm had obtained confidential information material to the present litigation." (See Ahmanson, supra, 229 Cal.App.3d at p. 1455.) Likewise, where it can be shown that there was no opportunity for confidential information to be divulged during the relationship, the courts will not find a presumption exists that the client disclosed confidences to the previous attorney (with one exception, for the very same work). (City National Bank, supra, 96 Cal.App.4th 315, 327-328.)
Further, the confidential information that is said to have been disclosed must be material with relation to the current representation issues. That is, disqualification is proper if the attorney acquired information during the first representation that was directly in issue or of critical importance to the second representation. (Farris, supra, 119 Cal.App.4th 671, 679-680.) The type of task performed is not dispositive, and it is possible for the disputed confidential information to have been gained in either a transactional or a litigation context. (See Jessen, supra, 111 Cal.App.4th at pp. 711-714.) The passage of time between the two representations is not conclusive either way, because the subject matter of the representation controls, as we next discuss. (Farris, supra, at p. 686.)
B. Similarities Between 1985/1990-1999 Advice to Maly and Current Representation of Center, Regarding Factual and Legal Questions
Petitioners argue there is no substantial relationship among the representations, and it is "inconceivable" that in 1985, Maly (or by extension, Meyers) imparted confidential information to the law firm that is "material" to the current representation. They rely on these factors: the law firm only represented Maly for two months in 1985 regarding the condominium, earning a fee of $437.50. At that time, the original 1981 CC&R's were in existence, but they had not yet been amended by the 1992 CC&R's. Permit 72 was issued in 1979 and was incorporated into the 1992 CC&R's. Petitioners argue that the subject lawsuit is based chiefly on any rights or duties created by that 1992 document, which did not exist at the time the firm represented Maly. Although petitioners concede Permit 72 deals with parking and therefore is material to the pending action, they continue to contend no evidence was presented of its materiality in the 1985 representation of Maly by the firm. They say there is no evidence of imparted confidential material information regarding Permit 72, nor any grounds for presumed transmission of such information.
Petitioners are drawing an extremely fine line between the two sets of representation, and we will initially disagree with their characterization of what happened in 1992, as next explained. However, since the merits of this dispute are not yet before us, and we confine our review to the substantial relationship issue, this characterization does not present a dispositive problem. According to petitioners, the only rights and obligations now at issue were newly created in 1992, and prior to the execution of the 1992 CC&R's, the homeowners "had never before granted to any independent third party the rights and obligations set forth in" paragraphs 3.3, 2.3, and 2.4 of that document, such as the right to reasonably regulate Lot 4, or alter the parking areas. However, we do not think it is appropriate for Center thus to characterize itself as an "independent third party," since it was the actually the grantee of the same 1992 transaction, in which it (through its predecessor, Fontenoy Tower Apartments) bought Lot 4 from the homeowners. Clearly, much work remains to be done on the merits to reconcile the different sets of governing documents in this case: the 1981 and 1992 CC&R's, along with Permit 72, the deed restrictions, the homeowners' consent to the sale, and so forth. However, for our purposes, we continue to examine only the specifics of the 1985-1999 sets of prior representation, on the substantial relationship issue.
In response to petitioners' arguments, Maly claims the scope of the prior representation was to investigate title, easements and condition of the property, and it is "title" which is now at issue in this litigation. Maly states the development, as it exists, was approved under Permit 72 in 1979, and the permit runs with the land and was incorporated in the 1992 CC&R's. Permit 72 specified the parking spaces shall be "permanently" maintained and not converted for any other use. As noted above, the merits of the dispute over whether any parking may nevertheless be "reasonably" regulated, under other provisions of the 1992 CC&R's, are not now before us.
The main focus of the legal representation at the time Maly was buying the condominium was research into any history of prior lawsuits and issues regarding structural stability, which might affect the value of the property. Even though title insurance was examined, we reject Maly's argument that any and all issues about "title," such as any existing rights for utilities, ingress, egress, parking, the carport and use and enjoyment of Lot 4, were necessarily covered by the prior representation. Rather, no one could have foreseen in 1985 that in 1992, the homeowners would agree to convey Lot 4 to Center's predecessor, and that disputes would then arise about the different sets of agreements and regulations applicable to this property. Through 1990-1992, the various homeowners signed their agreements to the dissolution of the master association and its transfer of Lot 4 to Center's predecessor, with various rights reserved. Attorney Martin was not asked in 1985 to guarantee that parking would always remain regulated chiefly by Permit 72, and the scope of the representation has not been shown to have covered any such complex legal and factual issues.
Merely because in 1985, the law firm reviewed the documents that then affected Maly's title, including Permit 72, that does not mean that confidential information material to the current litigation, under all of the existing circumstances, was passed from client to attorney (and by extension, to the law firm now). It is not dispositive that in 1985, Attorney Martin was instructed to and accomplished the obtaining of a new deed for Maly to specify inclusion of a particular parking spot. The questions of law about the interaction of Permit 72, the original CC&R's, the 1990-1992 homeowner's agreements and the 1992 version of the CC&R's will not be resolved upon the respective beliefs and desires of the various parties, but upon a legal interpretation of those documents, even if extrinsic evidence has to be considered. (See Harustak v. Wilkins (2000) 84 Cal.App.4th 208, 214-215 [interpretation of written instruments is essentially a judicial function, even if it involves factual issues].) From the 1985 attorney notes, including a heading "condo special," it can be determined that the scope of the services provided was limited in nature to the issues presented by the client, concerning purchase of the condominium in light of any possible lawsuits or soil subsidence problems, and those notes do not establish that the review of title documents was requested or conducted for the purpose of addressing the extent of parking rights with respect to Permit 72 or other regulation, since those issues were not and could not have been disputed at the time in the same way that they are now.
The issues presented in the current litigation, whether declaratory relief should be issued in such a way as to enable Center to pursue its development plans over Lot 4, will depend not only upon an interpretation of the documents affecting title and use as they appeared in 1985, but also on whether the 1992 amended declaration and owner agreements changed those rights. There is no indication that the 1985 representation could have involved the exchange of any confidential information on all those topics, at that time. Rather, petitioners have successfully shown the facts and legal questions posed are significantly different among the two sets of representation.
Moreover, when the law firm represented Maly and Meyers from 1990-1999 on various business and tax matters, it is undisputed that no questions were presented or litigated about this condominium. It is not dispositive that confidential information about other real estate holdings, such as tax identification, was provided to the law firm then, since the subject matters of the different legal representations were materially different. The 1990-1999 business and tax advice provided did not pertain to this dispute over easement and access rights to the condominium. Although Maly and Meyers assert in their opposition that the earlier representation "led to at least six more files being handled by Procopio," they do not state in their declarations that there was such a direct connection. Apparently, this argument is directed toward the duty of loyalty. However, as we have already noted, any generalized reliance on asserted breaches of the duty of ongoing loyalty, based upon this unrelated 1990-1999 representation, is mainly inapposite to the successive representation test that we must apply, concerning the risk of disclosure of confidential information about the prior representation. This was not a case of simultaneous representation. (Flatt, supra, 9 Cal.4th at p. 284.) We accordingly turn to the next part of the successive representation test.
C. The Nature and Extent of the Law Firm's Involvement in 1985 and During 1990-1999 Advice to Maly/Meyers
In this respect, the relevant factors on whether a substantial relationship exists between two sets of legal representation include "the time spent by the attorney on the earlier cases, the type of work performed, and the attorney's possible exposure to formulation of policy or strategy. [Citation.]" (Ahmanson, supra, 229 Cal.App.3d at p. 1455.) There, the court agreed that "there is reason to differentiate for disqualification purposes between lawyers who become heavily involved in the facts of a particular matter and those who enter briefly on the periphery for a limited and specific purpose relating solely to legal questions. [Citation.]" (Id. at p. 1457.) The substantial relationship test is only " 'intended to protect the confidences of former clients when an attorney has been in a position to learn them.' " (Id. at p. 1455.)
Here, the trial court discussed several of the 1985 file notes by Attorney Martin as pertaining to the need for adequate parking at the complex. There were 13 pages of notes, a reviewed title report, telephone calls and a new deed issued at that time. Also, the court's ruling outlined the 1979-1992 sequence of events in which Center and the homeowners prepared or obtained successive documents pertaining to title or use. Attorney Martin is no longer with the law firm, but vicarious disqualification would still be appropriate if she had been "heavily involved in the facts" of the current dispute (Ahmanson, supra, 229 Cal.App.3d at p. 1457) and had gained confidential information about the facts pertaining to the respective rights and duties of the parties regarding parking and easements, as they may exist at the present time.
However, the current dispute is mainly legal in nature, requiring interpretation of various land use restrictions imposed by the respective corporate parties, and any factual information previously gained from the individuals Maly and Meyers that was confidential in nature has not been shown to be germane in any material sense to the legal issues now before the trial court. No presumption of possession of confidential information that could be used adversely on these particular legal issues has arisen, nor was there any showing that in fact the law firm possesses any such important confidential information from its former clients. (Ahmanson, supra, 229 Cal.App.3d at pp. 1453-1455.) We cannot say that the law firm's "former and current employment are on opposite sides of the very same matter or the current matter involves the work the lawyer performed for the former client." (City National Bank, supra, 96 Cal.App.4th 315, 327-328; Rules Prof. Cond., rule 3-310(C), (E).) Instead, Attorney Martin and the law firm's involvement in 1985 was peripheral to the current set of disputes, and was not shown to involve strategic or policy matters. (Ahmanson, supra, 229 Cal.App.3d at pp. 1453-1455.)
Likewise, the 1990-1999 tax and business work by the law firm has not been shown to be substantially related to the issues in this case, even though Maly asserts the 1985 work "led to" the opening of those files. We acknowledge that this is a close case; however, the duty of loyalty issue, even though facially a serious matter, may have taken on a disproportionately large role in these proceedings and in the ruling that was issued. Under the applicable legal standards and the undisputed facts, we must conclude that the trial court abused its discretion in granting the motion to disqualify the law firm, since the substantial relationship test has not been met. (Flatt, supra, 9 Cal.4th at p. 284; SpeeDee Oil, supra, 20 Cal.4th at pp. 1143-1144.) As already stated, however, the motion for an order transferring the case to a new trial judge is denied for lack of any substantive merit.
DISPOSITION
Let a writ of mandate issue ordering the superior court to vacate its order granting the motion to disqualify counsel and to enter a new order denying the motion. Petitioners' request to order transfer of the case to a new trial judge is denied. Each party shall pay its own costs in this writ proceeding.
WE CONCUR: HALLER, J., IRION, J.