Matter of Cipriani

[*1] Matter of Cipriani 2006 NY Slip Op 50700(U) [11 Misc 3d 1084(A)] Decided on April 24, 2006 Sur Ct Holzman, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on April 24, 2006
Sur Ct

MATTER OF ESTATES OF Ralph Cipriani and ESTHER CIPRIANI, Deceased



20-A/89 and 723-A/03

Lee L. Holzman, J.

This is a motion by Gary Cipriani to disqualify counsel for Laura Cipriani ("counsel") in the pending proceedings in which Laura seeks to recover assets distributed from the estate of her father, Ralph. The movant contends that counsel should be disqualified because, in violation of DR 7-104 of the Code of Professional Responsibility (22 NYCRR 1200.35), he engaged in a conversation with the movant about the facts of the case and a possible settlement outside of the presence of the movant's counsel. Laura cross-moves for summary judgment requesting, inter alia, that she be declared the owner of a certain number of shares of Neil Avenue Construction Co. and that she be granted an inquest to determine the damages to which she is entitled as a result of the assets from the estate of her father having been distributed to Ralph's mother, Esther Cipriani. Alternatively, the cross-movant seeks additional time for discovery.

Ralph died in 1988. Gary, Ralph's brother, alleged in a petition for letters of administration that Ralph's sole distributee was his mother, Esther, who designated Gary to serve as the administrator of Ralph's estate. Gary distributed Ralph's estate to Esther. Esther died in 1998 and Gary was also the fiduciary of her estate. It was not until after Esther's death that Laura commenced proceedings in Ralph's estate seeking, inter alia, a determination that she was Ralph's daughter and his sole distributee. Gary opposed the application, alleging that Laura was not Ralph's daughter and that, in any event, none of the other family members were aware of her existence. Laura prevailed in that proceeding to the extent that it was determined that she was Ralph's daughter and his sole distributee (Matter of Cipriani, NYLJ, October 23, 2001, at 18, col. 6, aff'd. 298 AD2d 263 [2002], mot. for lv. to app. den. 100 NY2d 514 [2003]). However, no determination was made [*2]in that proceeding with respect to whether Laura was entitled to a recovery from Gary or any other party. The proceedings presently pending before the court arise from the determination in the initial proceeding.Counsel and the movant agree that at the time counsel

personally served the movant with two orders to show cause (one in Ralph's estate and one in Esther's estate) and a decree in Ralph's estate, directing the movant to account as the fiduciary of that estate, the movant invited counsel into his home and they engaged in a conversation. However, they disagree about the length of the conversation and the topics discussed. The movant alleges that counsel conversed with him for an hour about his relationship with his mother, her health prior to her death, her interest in the family corporation and the history of the building owned by that corporation. The movant claims that when he reported this conversation to his own attorney he was told that counsel's conduct was not ethical and that the information he had revealed to counsel could be used against him in the pending proceedings. The movant then reported the incident to the Disciplinary Committee. Counsel was admonished by the Committee for violating DR 7-104. The movant contends that if counsel is not removed, he does not have any meaningful remedy for counsel's violation of DR 7-104.

Counsel alleges that his conversation with the movant was brief. He states that the movant volunteered that he was interested in settling the matter and that he was considering dispensing with the services of the attorney who had represented him in the prior proceeding. Counsel avers that his conversation with the movant was essentially limited to his describing the papers that he was serving upon the movant and to his inviting the movant to come to his office to discuss settlement. Counsel denies that he in any way took advantage of the movant or that he was told any facts about the case which he did not already know from other sources. In any event, counsel contends that there could not have been a violation of DR 7-104 because every proceeding in the surrogate's court is a separate proceeding and, consequently, no attorney had appeared for the movant in the proceedings that were being commenced by the orders to show cause that were being served upon the movant.

DR 7-104 provides as follows:

A. During the course of the representation of a client a

lawyer shall not:

1. Communicate or cause another to communicate on

the subject of the representation with a party the lawyer knows

to be represented by a lawyer in that matter unless the lawyer

has the prior consent of the lawyer representing such other party

or is authorized by law to do so.

2. Give advice to a person who is not represented by a

lawyer, other than the advice to secure counsel, if the interests

of such person are or have a reasonable possibility of being in

conflict with the interests of the lawyer's client.

The disqualification of counsel is a matter which rests within the sound discretion of the court (Zutler v. Drivershield Corp., 15 AD3d 397 [2005]; Stober v. Gaba & Stober, P.C., 259 [*3]AD2d 554 [1999]; Schmidt v. Magnetic Head Corp., 101 AD2d 268 [1984]). Inasmuch as the Code of Professional Responsibility was enacted by the Appellate Divisions to provide rules for the legal profession to police itself, a disciplinary rule cannot be applied with the same force and effect as a statutory mandate of the legislature in an application to disqualify an attorney which affects the interests of litigants who are non-lawyers (Niesig v. Team I, 76 NY2d 363, 369 [1990]; S & S Hotel Ventures, Ltd. Partnership v. 777 S.H. Corp., 69 NY2d 437, 443 [1987]. Consequently, the movant does not automatically prevail in a disqualification application merely because it has been established that counsel violated a disciplinary rule. Instead, the court must balance the right of a litigant to counsel of choice, as well as the burden placed upon the litigant by requiring the retention of new counsel at the stage of the litigation that the disqualification application is made, against the movant's "right to be free from the apprehension of prejudice" caused by counsel's unethical conduct [Murphy v. Colbert, 203 AD2d 619, 620 [1994]; see also S & S Hotel Ventures Ltd. Partnership v. 777 S.H. Corp., supra). In determining whether a violation of DR 7-104 should result in disqualification, the court should focus upon such factors as whether the movant has reason to believe that he was exploited by counsel into making an improvident settlement, an ill-advised disclosure or an unwarranted concession (see Niesig v. Team I, supra, at 370).

The holdings in cases seeking disqualification for communications between counsel and a party to the litigation that counsel is not representing are fact specific. To the extent that there is a pattern, it would be that the more blatant the violation of the disciplinary rule the more likely that the court will find that the possibility of prejudice to the non-lawyer litigant warrants disqualification (compare the following cases in which the disqualification application was denied: Niesig v. Team I, supra, where there was an issue as to whether the employees of the corporate party interviewed by counsel should be considered a party to the litigation, and W.T. Grant Co. v. Haines, 531 F.2d 671 [2d Cir. 1976], where corporate counsel questioned corporate employees about wrongdoing and then commenced litigation against employees who had been interviewed, with the following cases in which the disqualification application was granted: Carey v. Carey, 13 AD3d 1011 [2004], where counsel in a proceeding involving custody and support of a child accompanied his client to the marital residence and communicated with his client's spouse even though the spouse's attorney had warned counsel not to go to the residence, and Papanicolaou v. Chase Manhattan Bank, 720 F. Supp. 1080 [SDNY 1989], where the defendant's counsel discussed the merits of the case with the plaintiff for an hour and a half outside the presence of the plaintiff's counsel).

Here, there is nothing in the record which indicates that counsel had any unethical motive when he decided to personally serve the movant with papers. It is uncontested that the movant invited counsel into his home so that the matter could be discussed. On the other hand, the uncontroverted facts also establish that counsel, albeit perhaps unknowingly, violated DR 7-104(A)(2) by his having admittedly given advice to the movant about the import of the papers that he was serving upon him. Moreover, counsel's reliance upon each proceeding in the surrogate's court being a separate proceeding does not establish that his conduct complied with either the letter or the spirit of DR 7-104. To the extent that counsel and the movant discussed the ramifications of the decree entered in Ralph's estate, counsel should have refrained from this conversation in the absence of the presence of the attorney who had represented the movant in the proceeding that led to the entry of the decree. It was also evident to counsel and the movant that the initial proceeding in Ralph's estate was merely a prelude to the commencement of additional proceedings by Laura so that she [*4]could recover the assets that the movant had distributed from Ralph's estate. That the movant believed that the attorney who represented him in the first proceeding was still representing him in the litigation with Laura is clear from the fact that he told counsel that he was thinking about dispensing with the services of the attorney who had been representing him. It further appears that the conversation between counsel and the movant had advanced to the point where counsel invited the movant, if he so desired, to come to his office, presumably without the assistance of counsel, to explore whether all of the issues between counsel's client and the movant could be settled. Under the above circumstances, the court, in the exercise of its discretion, grants the motion to disqualify counsel on the grounds that the court cannot conclude that the movant's apprehension of prejudice is without any realistic basis in light of the conversation between counsel and the movant having covered such topics as whether the health of Ralph's mother affected her ability to make gifts, the affairs of the family corporation and a possible settlement (see Papanicolaou v. Chase Manhattan Bank, supra). The court is constrained to reach this result notwithstanding that it appears that it was the movant who initiated the conversation and that it will be a hardship upon Laura to retain a new attorney who will undoubtedly have to expend considerable efforts to be as familiar with the matter as disqualified counsel. Nevertheless, it was counsel's obligation not to place himself in a position where the movant could plausibly claim that counsel's violation of DR 7-104 resulted in information being imparted to counsel which would be prejudicial to the movant and which would inure to the benefit of counsel's client. The court cannot countenance any reasonable possibility of such a result.

Inasmuch as the court is granting the motion to disqualify counsel, it is not appropriate at this time for the court to pass upon the alternate relief requested by Laura in her summary judgment motion which was prepared by removed counsel. All parties are stayed from taking any action in these proceedings for a period of 30 days from the entry of the order to be settled herein so that Laura may retain new counsel. The order to be entered herein shall also provide that these proceedings are scheduled for a status conference on June 21, 2006 at 9:30 a.m. to be attended by counsel for the respective parties.

Settle order.

SURROGATE