Opinion
NOT TO BE PUBLISHED
APPEAL from the Superior Court of Riverside County Super.Ct. No. INC052721. H. Morgan Dougherty, Judge.
Greenblatt & Associates, Fredric J. Greenblatt and Lisa L. Loveridge for plaintiffs and appellants.
Best Best & Krieger, Victor L. Wolf and Jerry R. Dagrella for defendants and respondents.
OPINION
HOLLENHORST J.
I. INTRODUCTION
Plaintiffs contend the trial court abused its discretion in denying their motion to disqualify defendants’ counsel because (1) defendants’ counsel improperly communicated with adverse parties without consent of plaintiffs’ counsel; (2) the trial court erroneously based its decision on the ground that plaintiffs had failed to show prejudice; and (3) the trial court considered facts and evidence that were not properly before the court. We find no abuse of discretion, and we affirm. In addition, because the face of the record suggests misconduct on the part of counsel, we will refer the matter to the State Bar of California for further investigation and, if appropriate, imposition of sanctions.
The underlying action involves the claims of several dozen individuals (collectively referred to herein as plaintiffs) against Century Crowell Communities, aka Century Vintage Homes, and a number of related entities and individuals (sometimes collectively referred to herein as Century) for, among other things, restraint of trade, unfair competition, racketeering, breach of fiduciary duty, negligence, breach of contract, and fraud.
II. FACTS AND PROCEDURAL BACKGROUND
On March 21, 2006, plaintiffs filed a motion to disqualify attorney Jerry Dagrella and Best Best & Krieger from representing defendants in the underlying action. The motion was supported by the declaration of Fredric J. Greenblatt with attached exhibits and a request for judicial notice. The motion alleged improper contacts with four persons who were clients or former clients of Greenblatt’s law firm: Ramon Ramirez, Judy Rowley, and Rhonda and Warren McCarns.
A. Evidence in Support of the Motion
1. Ramon Ramirez
Greenblatt’s declaration stated that Ramirez had retained Greenblatt’s office on March 16, 2006, to represent him in the underlying matter. A redacted copy of a signed retainer agreement was attached as an exhibit. The declaration stated that 34 named plaintiffs had filed suit against defendants on August 15, 2005, and that Ramirez was the lead plaintiff.
Greenblatt stated that on or about January 5, 2006, Dagrella contacted Ramirez and “questioned him about the instant action.” Although Ramirez had indicated on December 11, 2005, that he no longer wished to be a party to the underlying lawsuit, the request for dismissal was not filed and served until January 17, 2006.
Ramirez stated in his declaration that he had received a letter in early to mid-2005 from Michael Petersen soliciting him to be a plaintiff in a lawsuit against Century and that he had signed a document for Petersen, but did not remember what the document said. Ramirez received a packet of documents from Greenblatt in November 2005 asking him to sign three verification forms that referred to various discovery requests, but he never saw the discovery requests themselves or the responses he was being asked to verify. In a telephone conversation on December 11, 2005, Ramirez informed Greenblatt that Ramirez did not wish to be involved in the lawsuit, and that was the first and only time he had spoken to Greenblatt. He stated he had not been contacted by anyone from Century or Best Best & Krieger before asking to be dismissed from the lawsuit. No one had ever “threatened, intimidated, coerced, persuaded, encouraged, charmed or harassed [him] into dropping from the lawsuit.” (Bold omitted.)
It appears that Petersen is a paralegal in Greenblatt’s law firm.
2. Judy Rowley
Greenblatt’s declaration stated that in June 2005, Judy Rowley had retained and authorized Greenblatt & Associates to represent her in the underlying action, and she was listed as a plaintiff in the complaint. The declaration stated that Dagrella had contacted Rowley on or about January 5, 2005, and “questioned her about specific details involving the instant action.” Although Rowley had informed Greenblatt on December 15, 2005, that she no longer wished to be a plaintiff in the underlying lawsuit, the request for dismissal was not filed or served until January 17, 2006.
Rowley stated in her declaration that she had had a conversation with Michael Petersen in early to mid-2005 concerning the home she had purchased from Century, and she signed a document for him, although she did not recall what the document said. In November 2005, she received a packet of documents from Greenblatt asking her to sign three verification forms that referred to various discovery requests, but she never saw the discovery requests themselves or the responses she was being asked to verify. In mid-December, she spoke with someone at Greenblatt’s firm and asked to be dismissed from the lawsuit, and on December 15, 2005, she wrote a letter to Petersen requesting her dismissal. She spoke with someone from Century and informed them she did not want to be party to the lawsuit and later signed a statement to that effect. She did not believe she had ever met or spoken with Greenblatt. No one had ever “threatened, intimidated, coerced, persuaded, encouraged, charmed or harassed [her] into dropping from the lawsuit.”
3. Warren and Rhonda McCarns
Greenblatt’s declaration stated that in March 2005, Greenblatt & Associates sent correspondence to Best Best & Krieger informing Best Best & Kreiger that Greenblatt & Associates “has either been retained to represent or has been contacted by the following individuals: . . .” The list of individuals included Warren McCarns, but Rhonda McCarns was not named in the letter. The letter referred to “Petersen et al. [v.] Century Crowell Communities, et al.,” but did not otherwise specify the nature of the representation. (Emphasis in original.) The letter stated, “DO NOT COMMUNICATE WITH THE ABOVE PERSONS.” (Emphasis in original.)
Greenblatt stated in his declaration in support of the motion to disqualify that the McCarnses retained Greenblatt’s firm on March 15, 2005, “to represent them in enforcing causes of action arising in the purchase of” certain real property and that a copy of the retainer agreement was attached as Exhibit D to the declaration. However, no such retainer agreement was attached; Exhibit D consists of index pages to the depositions of other individuals.
Warren McCarns provided a declaration stating that in July 2005, he received a telephone call at his home from a person who identified himself as an attorney for Century and whose first name was “Jerry.” The person stated he had learned Warren McCarns was involved in the lawsuit brought against Century and asked if Warren McCarns knew who Mr. Petersen was. Warren McCarns replied that Mr. Petersen worked at Diversified Arbitration and was assisting in the lawsuit against Century.
“Jerry” told Warren McCarns that Petersen was a “crook” who had served time in prison and who made a living by suing people, as he had learned to do while in prison. “Jerry” told Warren McCarns that Petersen had assisted people in litigation in the past and in the end “took the money and ran.” “Jerry” said that Petersen was assisting people in the Century lawsuit because he was seeking revenge against Century for some other transaction that Petersen had had with Century.
“Jerry” spoke with Warren McCarns for 45 minutes to an hour, trying to convince Warren McCarns that Century had done nothing wrong, that only four people were involved in pursuing legal action against Century, and that if McCarns lost the lawsuit, McCarns would be stuck with the costs. During the telephone conversation, Warren discussed specific details of his claim against Century.
Rhonda McCarns provided a similar declaration. We consider that declaration irrelevant, because she was never identified as a person represented by counsel and was never a party to the underlying lawsuit.
4. Defendants’ Opposition
Instead of filing any declarations in opposition to the motion, defendants relied on previously filed declarations that were included in plaintiffs’ request for judicial notice. Dagrella stated in one of those declarations that he had had a conversation with Rhonda and Warren McCarns on April 26, 2005, about construction defect issues unrelated to the underlying lawsuit, which was not even filed until August 2005. Dagrella denied the “vast majority” of the statements in the McCarnses’ declarations and denied that he had coerced anyone into dropping their claims against Century.
B. Trial Court’s Ruling
The trial court denied the motion to disqualify counsel and issued a written ruling that stated, “The facts in this case are both convoluted and unique. Plaintiffs seek to disqualify defendant[s’] legal counsel base[d] on allegations of inappropriate contacts with various persons. In general Plaintiffs contend that a member of the law firm had telephone conversations with a party who is current party to the current case, was a former named party and a person who they represent but is not a party to the litigation. In support of the motion plaintiffs have attached retainer agreements with two persons dated May and June of 2005. In addition there is a letter stating that another person is represented by or has contacted the law firm dated in March of 2005. Plaintiffs have not submitted any declarations establish[ing] the content of the alleged conversations. Plaintiffs did submit in support of their motion copies of documents signed and prepared by the alleged erring attorney and declarations submitted by him at other proceedings. There are no declarations[] which discuss any prejudice to their case. In reviewing the motion it is difficult for the court to determine what contact took place and what was said. In addition it is impossible to tell what the representation was at the time of the contact. Nevertheless, plaintiff has failed to establish what prejudice the plaintiff would or have suffered because of any information counsel may have obtained during these conversations, which would disrupt the course of the litigation. What is apparent in this case is that many of the plaintiffs and potential plaintiffs never had any intention to become involved in the litigation. During the hearing, both counsel made numerous statements outside of the record, which the court cannot consider.” (Emphasis in original.)
Plaintiffs appealed from the denial of their motion and filed a petition for writ of supersedeas requesting this court to stay the underlying proceedings pending the disposition of the current appeal. This court denied the petition.
Additional facts are set forth in the discussion of the issues to which they pertain.
III. DISCUSSION
A. Standard of Review
A trial court’s ruling on a motion to disqualify counsel is reviewed for abuse of discretion. (Rosenfeld Construction Co. v. Superior Court (1991) 235 Cal.App.3d 566, 572-573.) When the trial court makes factual findings based on opposing declarations, “‘those in favor of the prevailing party must be taken as true, and the facts stated therein must be considered established.’” (Chronometrics, Inc. v. Sysgen, Inc. (1980) 110 Cal.App.3d 597, 603 (Chronometrics).)
B. Analysis
Plaintiffs contend the denial of their motion to disqualify was an abuse of discretion because the trial court erroneously based its decision on the ground that plaintiffs had failed to show prejudice.
1. Ruling on Motion to Disqualify
When an attorney violates the Rules of Professional Conduct of the State Bar of California (Rules of Professional Conduct), rule 2-100, the trial judge may disqualify the attorney from acting as counsel in an action related to the subject of the controversy when the misconduct will have a substantial continuing effect on the proceedings before the court. (Chronometrics, supra, 110 Cal.App.3d at p. 607; Mills Land & Water Co. v. Golden West Refining Co. (1986) 186 Cal.App.3d 116, 131-133, superseded by rule on another ground as stated in LaJolla Cove Motel & Hotel Apartments, Inc. v. Superior Court (2004) 121 Cal.App.4th 773, 788-789.) Here, in ruling on the motion to disqualify, the trial court stated it had been “difficult . . . to determine what contact took place and what was said” and “impossible to tell what the representation was at the time of the contact.” We agree. We will assume for purposes of argument that Dagrella’s contacts with Ramirez, Rowley, and Warren McCarns were at least technically improper (see Abeles v. State Bar (1973) 9 Cal.3d 603, 609-611 (Abeles)) and, like the trial court, focus on the issue of prejudice.
The parties’ briefs on appeal have been singularly unhelpful in clarifying the nature of such contacts. Plaintiffs’ brief asserts as established facts every assertion made in the declarations in support of the motion to disqualify. However, in their depositions, the McCarnses apparently contradicted in their entirety the statements made in their declarations. In our view, the trial court wisely avoided resolving the issue and instead focused on the prejudice ensuing from any improper contacts that might have taken place.
In Chronometrics, supra, the court accepted as true that counsel had improperly communicated with an adverse party “respecting a subject of controversy, knowing that he was represented by counsel, without the consent of such counsel . . . .” (Chronometrics, supra, 110 Cal.App.3d at p. 603.) The court noted that it was an issue of first impression in California courts “[w]hether such a violation authorizes the trial court to disqualify him and his law firm from acting as counsel in an action which related to the subject in controversy.” (Ibid.) The court concluded that the following principle should govern attorney disqualifications: “If the status or misconduct which is urged as a ground for disqualification will have a continuing effect on the judicial proceedings which are before the court, it is justified in refusing to permit the lawyer to participate in such proceedings. Thus a disqualification is proper for conflict of interest and . . . when he ought to be a witness in a forthcoming trial. If, on the other hand, the court’s purpose is to punish a transgression which has no substantial continuing effect on the judicial proceedings to occur in the future, neither the court’s inherent power to control its proceedings nor Code of Civil Procedure section 128 can be stretched to support the disqualification.” (Id. at p. 607.)
Broadly read, Greenblatt’s declaration in support of the motion to disqualify asserts two types of prejudice: (1) that as a result of defense counsel’s ex parte communications, several plaintiffs have withdrawn from representation by Greenblatt’s firm; and (2) defense counsel learned privileged information through ex parte contacts with the McCarnses that would provide an unfair advantage in future proceedings. However, other declarations do not support – and in fact directly contradict – plaintiffs’ assertions of prejudice.
First, Ramirez stated in his declaration, “I was not contacted by anyone from Century or Best Best & Krieger prior to my asking to be dismissed from the lawsuit. Nobody from Century or Best Best & Krieger (nor anyone else for that matter) has ever threatened, intimidated, coerced, persuaded, encouraged, harmed or harassed me into dropping from the lawsuit.” (Bold in original.) Rowley’s declaration likewise stated, “Nobody from Century or Best Best & Krieger (nor anyone else for that matter) has ever threatened, intimidated, coerced, persuaded, encouraged, charmed or harassed me into dropping from the lawsuit.” And the McCarnses never were parties to the underlying lawsuit. Thus, the declarations do not establish that any improper contacts by defense counsel led to withdrawal from the lawsuit.
Second, the depositions of the McCarnses established that they had not had any conversations with anyone from Greenblatt’s office until the day before their depositions. Thus, the record does not establish that anything defense counsel learned from ex parte communications with the McCarnses did not and could not reveal the “thoughts, theories and impressions regarding liability” of plaintiffs’ counsel.
We therefore conclude the trial court did not abuse its discretion in denying the motion to disqualify on the basis of lack of prejudice.
2. Consideration of Facts and Evidence Not Properly Before the Court
Plaintiffs contend the trial court abused its discretion in denying their motion to disqualify because the trial court considered facts and evidence that were not properly before the court, specifically, the transcripts of the depositions of the McCarnses and the declaration of Steven Hickman. Notably, plaintiffs cite no authority in support of their argument. (See Cal. Rules of Court, rule 8.204(a)(1)(B).) We therefore reject plaintiffs’ argument.
In the declarations attached to the motion to disqualify, the McCarnses stated they had retained Greenblatt’s firm to litigate their claims against defendants. At the hearing, Dagrella represented to the court that the McCarnses had stated in their deposition a few days before the hearing that their declarations were not true. The court requested a copy of the deposition transcript and read portions of it aloud in court. Counsel for plaintiffs complained that she had not been provided with a copy of the transcript of the deposition, but the court noted that “[i]t’s for you to purchase.” Counsel for plaintiffs later complained that the deposition transcript was not properly before the court, and the court should consider only the declarations of the McCarnses that had been attached to the motion. At the conclusion of the hearing, the trial court stated, “I did read portions of the deposition, but I read them out loud. I didn’t consider anything that was not read on the record.”
Dagrella mentioned, in arguing in opposition to the motion to disqualify, that he had obtained a declaration from one Steven Hickman that he had never authorized a lawsuit. The declaration was not further referred to at the hearing and is not part of the record on appeal.
C. Referral to State Bar
Plaintiffs contend on appeal that the trial court erred at the hearing on the motion to disqualify in focusing on apparent misconduct of plaintiffs’ counsel without having that issue before it. To the contrary, the issue was inherent on the face of the declarations plaintiffs relied on to support their motion. The argument that the trial court should have ignored evidence of misconduct before it is preposterous.
At the hearing, the trial court stated, “The second issue that concerns the Court is that apparently, Mr. Greenblatt, you and your office have filed a lawsuit and apparently you have no authority from a number of your clients to bring this litigation, and it would appear that some representative of yours has made apparently false statements. [¶] You, yourself, have submitted these declarations in support of this motion, and I’ll be perfectly frank with you: I wanted you here because I’m really considering referring this to the California State Bar Association under the statutory mandate that requires me to notify the State Bar of inappropriate conduct.”
We are astonished – as was the trial court – that plaintiffs chose to support their motion to disqualify defendants’ counsel with declarations that on their face indicate improper and unethical conduct on the part of plaintiffs’ own counsel. First, Ramirez stated he had never seen or reviewed the underlying complaint or discussed its allegations with anyone, although he conceded he had signed some documents without recalling what the documents had said. Rowley “d[id] not recall authorizing the inclusion of [her] name as a plaintiff in any lawsuit, though [she] may have signed a document . . . which [she] did not read thoroughly and carefully,” and she likewise had never seen or reviewed the complaint or discussed its allegations with counsel. Second, and more egregious, both Ramirez and Rowley stated that Greenblatt had requested them to presign verifications of discovery responses without informing them what those responses would be. Ramirez stated in his declaration that Greenblatt had mailed him verification forms that Greenblatt asked him to sign and return. The declaration stated, “Though the Verification forms refer to ‘Request for Admissions,’ ‘Form Interrogatories’ and ‘Special Interrogatories,’ I never did see, read, or receive any such documents nor did I have any awareness of what ‘responses’ Greenblatt & Associates intended to prepare on my behalf.” Rowley’s declaration contained substantially similar statements – that Greenblatt had requested that she sign verification forms for discovery responses without giving her any indication of what those discovery responses would be.
Counsel for plaintiff represented to this court at oral argument that the declarations of Ramirez and Rowley do not tell the whole story and suggested that a full record would exonerate counsel of any wrongdoing. We do not, in this forum, make that determination. Rather, we consider it appropriate to refer the matter to the State Bar of California for further investigation and development of a full record and, if appropriate, the imposition of sanctions. (See Bus. & Prof. Code, § 6086.7; see also, e.g., Drociak v. State Bar (1991) 52 Cal.3d 1085, [attorney’s use of client’s presigned verification of discovery responses without confirming with the client that the responses were accurate warranted sanction of suspension]; Abeles, supra, 9 Cal.3d at pp. 609-611.)
We recognize that the matter is not the subject of mandatory reporting under Business and Professions Code section 6086.7 in that it involves neither an order of contempt, the modification or reversal of a judgment based on attorney misconduct, nor the imposition of judicial sanctions. Nonetheless, the nature of the misconduct is serious and merits review by the appropriate disciplinary body.
IV. DISPOSITION
The order appealed from is affirmed. Upon finality of this opinion, the clerk of this court shall submit a copy of this opinion to the State Bar of California.
We concur: RAMIREZ P.J., MCKINSTER J.
Moreover, defendants’ brief contains numerous assertions of fact that are either entirely unsupported by any citations to the record or supported by references to documents that were apparently filed only in the trial court, but not made part of the record on appeal. We have therefore disregarded such assertions. (Berg v. Traylor (2007) 148 Cal.App.4th 809, 812, fn. 2; see also Cal. Rules of Court, rule 8.204.)
Furthermore, with respect to the central issue of the case, defendants failed to set forth arguments in their brief on appeal, but instead merely “refer[red] the Court to their opposition brief attached to Appellants’ Appendix . . . .” This practice does not comply with California Rules of Court, rule 8.204(a)(1)(B), which requires briefs on appeal to “support each point by argument and, if possible, by citation of authority.” (See Paterno v. State of California (1999) 74 Cal.App.4th 68, 109 [“An appellant cannot rely on incorporation of trial court papers, but must tender arguments in the appellate briefs.”] We could, therefore, in our discretion, treat the failure to file an adequate brief as a concession of error. Nonetheless, we choose to “examine the record on the basis of appellant’s brief and reverse only if prejudicial error is found.” (Votaw Precision Tool Co. v. Air Canada (1976) 60 Cal.App.3d 52, 55.)