Jane Doe v. Margaret Cafarelli, et al.
Case No: 18CV04974
Hearing Date: Tue Jun 04, 2019 9:30

Nature of Proceedings: Motion: Disqualify Counsel filed by Alma Del Pueblo

Motion by defendant Alma Del Pueblo Owner’s Association Inc. dba The Management Trust to disqualify plaintiff’s attorney

ATTORNEYS:

James Scafide /Tyler Sprague of Scafide law Firm, PC for plaintiff

Jeff C. Hsu / Patrick A. Gillespie of Murphy, Pearson, Bradley & Feeney for moving defendant

RULING: The motion is denied.

NOTE: At the outset, the Court recognizes that this phase of the case is not stayed as a result of the SLAPP decision being appealed. An anti-SLAPP motion automatically stays ONLY trial court proceedings on causes of action affected by motion. (See Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180)

Background:

Plaintiff Jane Doe filed her complaint on October 10, 2018, and her first amended complaint (FAC) on December 19, 2018. The operative FAC alleges 27 causes of action arising from her purchase and ownership of an affordable residential condominium unit in the Alma del Pueblo development, which is a mixed-use (i.e., both commercial and residential) development. The commercial units included the Santa Barbara Public Market. The residential units were predominantly sold as market-rate units, but plaintiff was able to purchase one of five of its affordable units.

Plaintiff alleges that she has been the victim of harassment and discrimination by defendant Alma Del Pueblo Owners Association (ADPOA), defendant Margaret Cafarelli—the developer of Alamo del Pueblo, and others. In the FAC, plaintiff alleged 27 causes of action against 12 defendants. The six causes of action alleged against ADPOA’s attorneys were stricken by the Court on April 2, 2019, pursuant to a Code of Civil Procedure section 425.16 motion to strike. That order is currently on appeal. The remaining causes of action included some which arose from ADPOA meetings and events in which plaintiff’s attorney, James Scafide, was directly involved, either as plaintiff’s attorney, as her ADA facilitator/interpreter, or both.

Scafide asserts that he met with plaintiff in the fall of 2018, to discuss the dispute, and during the meeting discussed the potential issue of his representation of her in any such matter because he may be called as a witness with respect to the underlying events with which he was involved. He reviewed Rule 3.7 of the California Rules of Professional Conduct with her, and asked her to think about finding alternate counsel to represent her in the dispute. She agreed to think about it, and asked him to research the matter. He did so before meeting with her again on October 8, 2018, at which time he again reviewed the rule and reported the results of her research. He advised her to contact another attorney to advise her on the issue, but she declined. During the meeting, he prepared a document entitled “Informed Consent,” reviewed it with plaintiff, and suggested she discuss it with another attorney, but she again declined and indicted she wanted him to represent her. She signed the agreement.

On April 10, eight days after the Court granted the special motion to strike the claims alleged against ADPOA’s attorneys, plaintiff filed a second amended complaint (SAC) without leave of court. In the SAC, plaintiff alleges 26 causes of action against 10 defendants (excluding the attorney defendants). The causes of action alleged included claims for negligent and intentional infliction of emotional distress, as well as disability discrimination, which directly arise from events in which Scafide was involved in some respect. Mr. Scafide is also referenced in the SAC with respect to his involvement in the underlying matters, in the lengthy “Statement of Facts” portion of the SAC. (See, e.g., SAC @ ¶¶ 63-64, 107, 108-115, 125-128.)

On April 22, 2019, ADPOA filed a motion to disqualify Scafide as counsel for plaintiff, on the basis that Scafide is an essential witness in the action. The motion was set for hearing on May 21, 2019, along with a motion to disqualify Scafide on the basis of a claimed conflict of interest, asserted by defendant Sonia Rosenbaum. At the hearing, the Court denied the Rosenbaum motion. With respect to the ADPOA motion, the Court issued a tentative ruling prior to the hearing which stated:

These defendants move to disqualify Scafide and his firm as counsel for plaintiff because Scafide is an essential witness in this action. Plaintiff has not filed an opposition to this motion.

These defendants ask the Court to take judicial notice of plaintiff’s declaration filed in this court on March 20, 2019 (RJN Exhibit 1) and Scafide’s declaration filed in this court on March 21, 2019 (RJN Exhibit 2). The Court grants the request for judicial notice.

There appears to be little question that Scafide’s testimony will likely be required. Plaintiff used him at ADPOA meetings as a facilitator and “interpreter.” In the SAC, plaintiff alleges: She appeared at the ADPOA annual meeting on October 9, 2017, with her “interpreter, Mr. Scafide.” [SAC ¶¶124, 125] Cafarelli told plaintiff she could not have her attorney with her. [SAC ¶125] A director called plaintiff “crazy” and Scafide asked him to repeat that. [SAC ¶126] Cafarelli called her attorney and put her on speaker phone. Scafide asked to have a private conversation with the attorney but she refused. [SAC ¶127] This incident humiliated and embarrassed plaintiff and caused her to suffer severe emotional distress. [SAC ¶132] In declarations, Scafide and plaintiff confirmed his role as “facilitator/translator” at this meeting and the events as alleged in the SAC. [RJN Exhibit 1, ¶¶12-15; RJN Exhibit 2, ¶¶5-7] Scafide had previously attended a meeting to review finances with Cafarelli as plaintiff’s friend, moral support, and facilitator/ interpreter. [RJN Exhibit 1, ¶¶7, 9] The October 9, 2017 meeting appears to be a key event forming part of the basis for plaintiff’s action and the recollections of all participants are likely to be a source of testimony at trial.

When ruling on a disqualification motion and balancing the competing interests, the Court “should resolve the close case in favor of the client’s right to representation by an attorney of his or her choice …. Under the present rule, if a party is willing to accept less effective counsel because of the attorney’s testifying, neither his opponent nor the trial court should be able to deny this choice to the party without a convincing demonstration of detriment to the opponent or injury to the integrity of the judicial process.” Reynolds v. Superior Court, 177 Cal.App.3d 1021, 1028 (1986).

The American Bar Association Model Code of Professional Responsibility Rule 3.7(a) provides that a lawyer shall not act as an advocate and witness in the same case unless, among other reasons, “disqualification of the lawyer would work substantial hardship on the client.” California has not adopted the Model Rules, but a court may consider ethical rules other jurisdictions and bar associations adopt. People v. Donaldson, 93 Cal.App.4th 916, 928 (2001). The rule is aimed at eliminating confusion over the lawyer’s role. Id. The court in People v. Donaldson quoted from the “Legal Background” for ABA Rule 3.7(a):

“The prohibition against a lawyer serving as advocate and testifying as a witness in the same matter is essentially aimed at eliminating confusion over the lawyer’s role. This confusion could prejudice one or more of the parties or call into question the impartiality of the judicial process itself. As an advocate, the lawyer’s task is to present the client’s case and to test the evidence and arguments put forth by the opposing side. A witness, however, provides sworn testimony concerning facts about which he or she has personal knowledge or expertise. The very fact of a lawyer taking on both roles will affect the way in which a jury evaluates the lawyer’s testimony, the lawyer’s advocacy, and the fairness of the proceedings themselves.” Id.“Combining the roles of advocate and witness can prejudice the opposing party and confers on the opposing party proper objection where the combination of roles may prejudice that party’s rights in the litigation.” Id. at 929.

California’s rule is Rule of Prof. Conduct 5-210(a), as applicable here, provides: “A lawyer shall not act as an advocate in a trial in which the lawyer is likely to be a witness unless: … (3) the lawyer has obtained informed written consentfrom the client.” “‘Thus the State Bar has concluded that a fully informed client’s right to chosen counsel outweighs potential conflict or threat to trial integrity posed by counsel’s appearance as witness.’” Smith, Smith & Kring v. Superior Court (Oliver), 60 Cal.App.4th 573, 579 (1997), quoting Maxwell v. Superior Court, 30 Cal.3d 606, 619 n9 (1982).

It should be noted that People v. Donaldson, supra, is a criminal case. In another case on which defendants rely—Kennedy v. Eldridge, 201 Cal.App.4th 1197, 1212 (2011), the court stated “we recognize that criminal cases enjoy special stature so as to ensure that defendants receive a fair trial.” Id. at 1212. Kennedy v. Eldridge was a paternity action, in which the child’s paternal grandfather (Richard) sought to represent his son, the child’s father. The trial court disqualified the grandfather as counsel and the appellate court affirmed the disqualification order. “[I] it is also true that family law matters deserve particular attention when it comes to maintaining high standards in ethics. Family law cases delve into the most intimate and personal of human affairs and therefore should receive careful scrutiny when potential ethical conflicts arise.” Id. “The wisdom of the advocate-witness prohibition is vividly exemplified in this family law dispute, where it is probable that Richard may not only provide important testimony affecting the outcome, but actually represent his son in an adversarial role against the mother of his grandson. Under no judicially tolerable circumstance can Richard effectively perform such multiple, awkward and conflicting duties.” Id. at 1211.

This is not a criminal case or a family law matter. So the concerns about the dual role are not as strong.

But the Court does not know if the informed consent exception to the rule that a lawyer shall not serve as an advocate in a trial in which the lawyer is likely to be a witness applies. Because plaintiff has not responded to this motion, the Court does not know if Scafide has obtained written consent from his client to serve as both advocate and witness or whether that consent is informed. Absent such a showing, the Court must grant the motion to disqualify James F. Scafide as counsel for plaintiff Jane Doe.

ADPOA and TMA do not ask to disqualify the Scafide Law Firm. Mr. Tyler Sprague of the Scafide Law Firm is not disqualified by this order.

The Court grants the motion of defendants Alma Del Pueblo Owners Association and The Management Assoc., Inc., to disqualify James F. Scafide as counsel for plaintiff Jane Doe. The Court does not disqualify the Scafide Law Firm or Mr. Tyler Sprague from representing plaintiff.

Scafide contends that he had not received the ADPOA motion, and was unaware of its existence until he checked the Court’s website on 5/20 to see if a tentative ruling had been posted on the Rosenbaum motion, and would have filed opposition had he known about the motion. He downloaded the motion and the tentative decision on 5/20, and met with plaintiff to review the motion and tentative decision, asking her if she wanted him to represent her in the matter, which she answered in the affirmative. During the meeting, he updated the original Informed Consent, and created a document entitled “Reaffirmed Informed Consent.” He again advised plaintiff to consult with another attorney on the issue, but she declined, insisted she wanted him to represent her, and executed the document.

Scafide appeared at the hearing on the disqualification motion, which the Court continued to June 4, 2019, after argument. On the same day, Scafide filed a declaration (executed on 5/20/19) in support of plaintiff’s opposition to the ADPOA motion to disqualify, which set forth the history of his meetings with plaintiff regarding the fact that he would likely be required to testify as a witness in the matter, his review with her of the relevant rules of professional conduct, his advisement that she consult other counsel on the issue, and her ultimate insistence that he represent her, as well as her execution of the two informed consent documents, which he attaches to the declaration.

On 5/28/19, the ADPOA filed a reply to Scafide’s opposition declaration, in which it again urged the Court to disqualify Scafide. The reply contends there is a substantial likelihood of injury to the judicial process if Scafide is not disqualified, in that the jury will be incapable of distinguishing between his role as attorney and his role as witness, particularly given CACI 106, which specifies that what attorneys say during trial is not evidence. As a result, jurors may have a diminished opinion of the judicial process, or believe that it is unfair or inequitable since one side’s attorney was allowed to testify while the other side’s attorneys were not. ADPOA further argues that it would be prejudiced by Scafide’s dual role, in that it is “reasonable” to conclude that a jury would give his testimony greater credibility and greater weight than that of other witnesses, because it will be familiar with him by the time he testifies. It argues further that plaintiff will have impliedly waived attorney-client privilege, if Scafide is called to testify as to matters placed in issue by plaintiff, or about matters Scafide could only have learned through the attorney-client privilege. It argues that plaintiff offered no evidence of prejudice in having separate counsel represent her. Finally, it urges that the entire firm should be disqualified, and not simply Scafide, since it would be impossible to erect an ethical wall with such a small firm.

ANALYSIS

After reviewing the declaration and executed Informed Consent documents submitted by plaintiff, and the reply arguments submitted by ADPOA, as well as all of the documents considered prior to the original hearing date on this motion, the Court will now deny the motion to disqualify plaintiff’s attorney.

In a brief review of the authorities governing the disqualification motion, the Court notes that its previous analysis failed to reflect that new California Rules of Professional Conduct were adopted, effective November 1, 2018. New Rule 3.7 replaces former Rule 5-210, and provides, as the former rule did, in relevant part:

(a) A lawyer shall not act as an advocate in a trial in which the lawyer is likely to be a witness unless:

(1) the lawyer’s testimony relates to an uncontested issue or matter;

(2) the lawyer’s testimony relates to the nature and value of legal services rendered in the case; or

(3) the lawyer has obtained informed written consent from the client. . . .

As also stated previously by this Court, the current state of the law is that “if a party is willing to accept less effective counsel because of the attorney’s testifying, neither his opponent nor the trial court should be able to deny this choice to the party without a convincing demonstration of detriment to the opponent or injury to the integrity of the judicial process.” (See, e.g., Reynolds v. Superior Court (1986) 177 Cal.App.3d 1021, 1028.) Further, given the importance of protecting the client’s ability to retain his or her own counsel of choice, such a demonstration requires an evidentiary showing of some actual detriment to the opponent or of injury to the integrity of the judicial process, before the trial court could disqualify the attorney. (Gilbert v. National Corporation for Housing Partnerships (1999) 71 Cal.App.4th 1240, 1258, citing Smith, Smith & Kring v. Superior Court (1997) 60 Cal.App.4th 473, 577-582.)

Rather than making any evidentiary showing of actual detriment to it, ADPOA relies upon its speculation as to what could potentially happen at the trial, in asserting that either it or the integrity of the judicial process could suffer injury if Scafide is not disqualified. Under Smith and Gilbert, supra¸ speculative contentions are insufficient to support disqualification. ADPOA points to CACI 106, and the problems the instruction could raise, without giving consideration to the possibility that other specially drafted jury instructions could diminish or eliminate the perceptional issues with the jury. It points to possible waivers of the attorney-client privilege with respect to issues raised by plaintiff at trial, without given any credence to this Court’s ability to determine whether any specific privilege objections that plaintiff might assert in response to cross-examination of Scafide must necessarily be found to have been waived, under the circumstances which then exist during the trial. Scafide’s testimony, although likely required, is relevant only with respect to certain limited issues and causes of action, and will be far from key testimony in the case as a whole.

Because this Court cannot find that the showing made by ADPOA is sufficient to overcome plaintiff’s significant right in being represented by the attorney of her choice—particularly given her apparent informed consent to Scafide’s continued representation of her, even in light of the issues raised by the disqualification motion—the Court will deny the motion.