November 5, 2008
JAMES CHENEY, AS PRELIMINARY EXECUTOR OF CONSTANCE JOYCE CHENEY, DECEASED, PLAINTIFF,
DIANE WELLS, DEFENDANT.
TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY, PLAINTIFF,
DIANE WELLS AND JAMES CHENEY, AS PRELIMINARY EXECUTOR OF THE ESTATE OF CONSTANCE CHENEY, DECEASED, DEFENDANTS.
The opinion of the court was delivered by: Kristin Booth Glen, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the printed Official Reports.
This motion to withdraw as counsel raises serious and important issues about the obligations of the court and of counsel when it appears that a client who is a defendant in a civil action lacks capacity to assist or participate in the defense of that action.
Movant represents Diane Wells ("Diane"), defendant in an action initially brought in Supreme Court, New York County by her now-deceased mother, Joyce Cheney ("Joyce"). Following Joyce's death, her son, and Diane's brother, James Cheney ("James"), preliminary executor of Joyce's estate, was substituted as plaintiff. While there are eleven separate causes of action,*fn1 the common factual background involves claims that, while living with Joyce in Joyce's apartment, Diane engaged in a long course of harassment, threats and mistreatment of her mother that ended only when Diane was arrested and convicted for an assault on Joyce resulting in the latter's broken arm. Subsequent criminal charges against Diane, for allegedly soliciting her brother's murder, were dismissed.
After various proceedings in Supreme Court, during which Diane was first represented by Raoul Felder,*fn2 and then by Kramer & Dunleavy,*fn3 the case was transferred to this court by order dated August 23, 2007.*fn4
Since that time, as the case moved toward trial, Diane has gone through four separate sets of counsel. She was initially represented by the Law Offices of Gerald Shargel and Wachtel & Masyr, by Howard Elman; on January 15, 2008 and February 25, 2008, Judd Burstein was substituted for Elman and Shargel, respectively. Burstein moved to be relieved in March, 2008, stating, inter alia, that Diane has made it "unreasonably difficult" for him "to carry out employment effectively," citing DR 2-110(c)(4), and that "it is almost impossible to adequately describe the nightmare of representing Ms. Wells." Burstein noted, "It is clear that Ms. Wells is a severely emotionally damaged person." Describing a conference call about discovery matters, and an upcoming court date, Burstein reports that Diane "explained to [a court attorney/referee] that she was psychologically incapable of appearing in court" on the appointed date. After a conference with the court, at which he further elucidated the difficulties which led to his motion, Burstein was permitted to withdraw, and Diane was given a continuance to obtain new counsel. As of that date, the trial was scheduled to begin on May 18, 2008.
In April, 2008, Diane retained Joshua R. Katz,*fn5 an attorney who had previously been employed at the Felder firm. The retainer agreement anticipated that Katz would secure the services of trial counsel, and in May 2008, after interviewing several firms, he was successful in matching Ms. Wells with the law firm of Castro & Karten. Almost literally on the eve of trial, that firm sought an adjournment which was vigorously opposed by James's counsel. Castro & Karten assured the court that, unlike previous counsel, they would be able to effectively deal with Diane and be ready for trial in August, 2008. Citing Diane's psychiatric problems and communications with her treating psychiatrist, Dr. Stuart Serdam, new counsel noted his prescription of new medications, and Diane's promise that she would have live-in help to ensure that she took those medications which would allow her to relate effectively and appropriately to counsel in the course of trial preparation and trial.*fn6
The motion was granted, and the trial adjourned to August 4, 2008, marked final against defendant. On July 18, Castro & Karten moved for leave to withdraw on the grounds, inter alia, that "Wells has engaged in such conduct which renders it unreasonably difficult for Castro & Karten to carry out its employment effectively" pursuant to DR 2-110 of the Disciplinary Rules of the Code of Professional Responsibility. In support of their motion, they supplied an extensive in camera affidavit detailing issues and difficulties in their representation of Diane.*fn7
Shortly thereafter, Joshua Katz also moved to withdraw on several grounds, including "a breakdown in communication such that [Diane] refuse[d] to accept [his] advice and counsel" and Diane's "verbally abusive behavior." In addition, because of Castro & Karten's motion, Katz now feared that he would be required to serve as trial counsel, a role for which, he claimed, he was neither suited nor retained.*fn8 On July 28, the return date of both motions, after considerable colloquy, Castro & Karten's motion was granted and Katz's held in abeyance, as the latter neither alleged nor provided information (in camera or otherwise) that the attorney/client relationship had so deteriorated that he could no longer represent Diane consistent with his ethical responsibilities.*fn9 Once again the trial date was adjourned, this time to October 22nd, and again it was marked final against Diane.
Thereafter, in August 2008, Diane filed a consent to change attorney and notice of appearance from Stephanie E. Kupferman of Kupferman & Kupferman. Counsel for James then moved to require Katz to remain as counsel because "[g]iven the unique and troubling history here - - - where the defendant has cycled through 13 sets of attorneys - - - Katz, the only relative constant, should be required to stay in the case, to avoid any future problems and to ensure availability of trial counsel on October 22."
On September 5, with Ms. Kupferman present, confidently stating her willingness and ability to represent Diane at trial, that motion was denied,*fn10 leaving Kupferman & Kupferman as the sole counsel.
Even as all these changes of counsel were occurring, there was a pre-trial conference, and numerous in limine motions were made and decided.*fn11 Various issues regarding Diane's witness list (containing 29 witness names, which were described as required by the court's pretrial order, and 45 names, lacking the required description as to the substance and relevance of their expected testimony) and possible medical expert(s) were still pending; Kupferman was directed to parse and amplify the witness list, settle on a medical expert and supply the appropriate summary of expected testimony, and certify that all discovery demands had been complied with.*fn12
Kupferman now moves for leave to withdraw "on the ground that a substantial conflict exists between the Kupferman firm and Ms. Wells precluding their continued representation of her in this matter." She submits two in camera affidavits*fn13 setting forth with more particularly the grounds upon which she believes that, as she stated in open court, continued representation would cause her to violate her ethical obligations under New York's Code of Professional Responsibility ("the Code"). Although served with the motion, Diane did not appear on the return date; the motion was marked "submitted" and all counsel*fn14 were directed to appear for a previously scheduled conference on October 7.*fn15 Kupferman was also directed to again notify Diane of that conference, and to convey the court's direction that she attend.
The court met with Diane, Kupferman and Novick for more than an hour and conversed extensively with Diane about the extremely difficult situation in which she had once again placed herself. She was scheduled, in two weeks, for a trial marked final against her; she had no counsel willing to represent her; the trial would involve complicated evidentiary issues far beyond the command of any non-lawyer; and, if she lost the trial, she could potentially lose both her home and more than $3.8 million. During that conversation, as had previously been detailed in various attorneys' in camera affidavits, and as the court observed at prior in court appearances,*fn16 it was apparent not only that Diane was incapable of managing the instant litigation, but also that she was unable to appreciate the consequences of that incapacity.*fn17
This is, of course, precisely the situation addressed by Mental Hygiene Law Article 81, our adult guardianship statute. Article 81 begins with the presumption that every adult is fully capacitated, and then permits appointment of a guardian only for those areas in which a person "is likely to suffer harm because" [she] "is unable to provide for personal needs and/or property management; and . . . the person cannot adequately understand and appreciate the nature and consequences of such inability" (MHL § 81.02[b], ). Article 81 guardianships are intended to be "closely tailored" to an individual's incapacity, and to replace her autonomy only to the extent necessary to protect her from harm with regard to such incapacity.*fn18 Thus, a person who is adequately managing personal needs and most financial needs might, as may be the case here, need a guardian only for a specific and limited purpose*fn19 (see MHL § 81.16[b]).
This case calls out for a judicial determination, based on an evidentiary hearing, as to whether Diane is capable of managing this litigation within the definition of Article 81. If she is, then the case will be tried, with or without counsel representing her. If she is not, and the Article 81 court so determines, a limited property guardian can be appointed and the trial will proceed with that guardian directing the litigation, including any counsel she may choose to retain. All parties and counsel - including even Diane - agree that an Article 81 proceeding is appropriate and should be commenced.*fn20
The difficulty arises in ascertaining precisely who can or should bring the proceeding. The statute requires the Article 81 petition to contain "specific factual allegations as to the financial transactions or other actual occurrences involving the person alleged to be incapacitated which are claimed to demonstrate that the person is likely to suffer harm because he or she cannot adequately understand and appreciate the nature and consequences of his or her inability to provide for property management" (MHL § 81.08).
In this case, that would include only those who are or have been privy to the often confidential*fn21 communications between attorney and client.
The Code is decidedly unhelpful in determining whether counsel may*fn22 or should commence a guardianship proceeding for an allegedly incapacitated client (see Association of the Bar of the City of New York, Committee on Professional Responsibility, A Delicate Balance : Ethical Rules for Those Who Represent Incompetent Clients, 52 The Record 34  ["Bar Report"]). While there are several non-binding Ethical Considerations ("ECs")*fn23 that bear upon the obligations of an attorney representing an incapacitated client,*fn24 they make no reference to guardianship or other protective proceedings except insofar as they require an attorney to take direction from an already existing guardian or other "duly constituted" personal representative.
Further, even the few, somewhat contradictory ethical opinions that exist do not provide clear guidelines (Bar Report, supra at 38-39*fn25). Commentators have concluded that the ECs "no longer reflect the state of the law or realities of disability law practice*fn26 (but see NY St Bar Assn Comm on Prof Ethics Op 746 [July 18, 2001] [permitting an attorney who holds a durable power of attorney to commence an Article 81 proceeding without his client's consent when the client is incapacitated, where there is no practical alternative to protect the client's interests through the durable power or otherwise, and where no one else is available to serve as petitioner]).
In the absence of guidance from the Code, it is appropriate to look to the two main sources of legal ethics in this country, the ABA Model Rules of Professional Responsibility ("Model Rules") and the Restatement (Third) of the Law, The Law Governing Lawyers (2000) ("Restatement").*fn27 Model Rule 1.14, "Client With Diminished Capacity," provides:
"(a) When a client's ability to make adequately considered decisions in connection with the representation is impaired, whether because of minority, mental disability or for some other reason, the lawyer shall, as far as reasonably possible, maintain a normal lawyer-client relationship with the client.
"(b) A lawyer may seek the appointment of a guardian or take other protective action with respect to a client only when the lawyer believes that the client cannot adequately act in the client's own interest."*fn28
Restatement § 24 provides:
"(4) A lawyer representing a client with diminished capacity as described in Subsection (1)*fn29 may seek the appointment of a guardian or take other protective action within the scope of the representation when doing so is practical and will advance the client's objectives or interests, determined as stated in Subsection (2)."*fn30
Here, where it can be reasonably determined that Diane is unable to act in her own interest, and, as the Restatement adds, no other practical method is available to protect her interest,*fn31 these authorities would permit Kupferman to commence an Article 81 proceeding to appoint a limited property guardian to litigate and defend the instant action.
Equally, if not more compelling, the State Bar has engaged in a multi-year study of a proposed revision to the New York Code, essentially replacing the Code with the Model Rules, through its Committee on Standards of Attorney Conduct ("COSAC") formed in 2003. COSAC's Report was unanimously approved by the New York State Bar Association's House of Delegates on November 3, 2007.*fn32 The Proposed Rules are currently under submission to the Appellate Division, and COSAC's Report, and the new rules it would adopt, have already been cited with approval (see Alexander v Cahill, 2007 WL 2120024 [ND NY 2007]).
Proposed Rule 1.14 provides, in pertinent part,
"(b) Where the lawyer reasonably believes that the client has diminished capacity, is at risk of substantial physical, financial or other harm unless action is taken and cannot adequately act in the client's own interest, the lawyer may take reasonably necessary protective action, including consulting with individuals or entities that have the ability to take action to protect the client and, in appropriate cases, seeking the appointment of a guardian ad litem or a guardian.*fn33
"(e) A lawyer should not be subject to professional discipline for invoking or failing to invoke the permissive conduct authorized by this Rule if the lawyer has a reasonable basis for the lawyer's action or inaction."
The Commentary recognizes that, in bringing a guardianship proceeding, "the lawyer is impliedly authorized to make the necessary disclosures, even when the client directs the lawyer to the contrary" (NY St Bar Assn, COSAC, Comment  to Proposed Rule 1.14, Disclosure of the Client's Condition).
Based on all three relevant authorities, it appears that there is no ethical impediment to Kupferman's bringing a limited guardianship proceeding for her client, and to disclosing to the Article 81 Court*fn34 whatever information may be necessary.*fn35 Such a proceeding is the "least restrictive alternative" available, and Kupferman is the only available person*fn36 with significant knowledge to bring it. In addition, the current Code provision relating to confidentiality*fn37 specifically provides that an attorney may not disclose communications with his client except under strictly limited circumstances including "when permitted under Disciplinary Rules or required by law or court order" (DR 4-101[c]; 22 NYCRR § 1200.19 [c] [emphasis added]).
As a court order definitively releases an attorney from liability under the Code, Kupferman's motion to withdraw is granted contingent upon her commencing an Article 81 proceeding for a limited property guardian for Diane Wells within 30 days. The trial previously scheduled for October 22 has been adjourned sine die pending the results of that hearing.
This constitutes the decision and order of the court.