Flick Mortgage Investors, Inc. v. The Epiphany Mortgage, Inc., et al., 2006 NCBC 3.
STATE OF
SUPERIOR COURT DIVISION
FLICK MORTGAGE INVESTORS, INC., )
)
Plaintiff, )
)
v. )
)
THE
EPIPHANY MORTGAGE, INC., ) 04-CVS-22296
MICHELE
A. DIXON, )
R.
KENT WILKINSON and )
MOTT
E. SIMPSON, individually and )
d/b/a
MOTT’S APPRAISALS, and )
FIRST
DECISION MORTGAGE, INC., )
)
Defendants. )
)
FLICK MORTGAGE INVESTORS, INC., )
)
Plaintiff, )
)
v. )
)
FIRST
DECISION MORTGAGE, INC., )
04-CVS-22297
THE
EPIPHANY MORTGAGE, INC., )
MICHELE
A. DIXON, )
R.
KENT WILKINSON and )
MOTT
E. SIMPSON, individually and )
d/b/a
MOTT’S APPRAISALS )
)
Defendants. )
)
FLICK MORTGAGE INVESTORS, INC., )
)
Plaintiff, )
)
v. )
)
FIRST
DECISION MORTGAGE, INC., )
04-CVS-22298
MICHELE
A. DIXON, )
JAMES
L. WRIGHT, individually and )
d/b/a
JAMES WRIGHT CO., )
)
Defendants. )
)
FLICK MORTGAGE INVESTORS, INC., )
)
Plaintiff, )
)
v. )
)
FIRST
DECISION MORTGAGE, INC., )
04-CVS-22299
MICHELE
A. DIXON, )
R.
KENT WILKINSON and )
MOTT
E. SIMPSON, individually and )
d/b/a
MOTT’S APPRAISALS )
)
Defendants. )
)
Andresen
& Associates by
Sperry & Tyson, PLLC by Adam M. Tyson for
Defendants Michele A. Dixon and The Epiphany Mortgage, Inc.
Pharr
& Boynton, PLLC by Stacey D. Bailey and Steve M. Pharr for Defendants
Mott’s Appraisals, Mott E. Simpson, and R. Kent Wilkinson.
Teague Campbell Dennis & Gorham, LLP by Christopher
G. Lewis for Defendant James L. Wright, individually and d/b/a James Wright Co.
Law Office of Brad W. Butler by Bradley W.
Butler for Defendant First Decision Mortgage, Inc.
DIAZ, Judge.
ORDER
{1}
The
Court heard this matter on January 24, 2006, upon the Motion of Plaintiff Flick
Mortgage Investors, Inc. (“Flick”) to Disqualify Counsel pursuant to Rule 1.9
of the North Carolina Revised Rules of Professional Conduct (the “Motion to
Disqualify”). Specifically, Flick moves
the Court to disqualify attorney Christopher M. Vann (“Vann”) and Vann Law
Firm, P.A. as counsel for Defendant First Decision Mortgage, Inc (“First
Decision”).
After considering the Court files, the written motion, the
affidavits filed in support of and in opposition to the motion, the
stipulations of the parties, and the arguments of counsel, the Court makes the
following
FINDINGS OF
FACT
{2}
Flick is represented in these actions by the
law firm of Andresen & Associates.
{3}
From November 8, 1999 through January 20,
2005, Vann was associated with the law firm of Andresen & Associates. During Vann’s tenure with the firm, its name
was changed to Andresen & Vann.
{4}
Sometime in August 2004, Flick retained Andresen
& Vann to represent it in these actions.
{5}
Vann was an attorney with Andresen &
Vann at the time Flick became a client and at the time the complaints in these
actions were filed. The firm then
consisted of three lawyers, including Vann.
{6}
During the time that Vann was associated
with Andresen & Vann, the firm maintained all client files in hard copy as well
as on the firm’s central computer server.
All client matters were accessible to all attorneys and staff at the
firm. Thus, Vann had access to all information
regarding Flick and these actions, including any and all confidential
information.
{7}
The complaints filed in these actions were
signed “Andresen & Vann” as counsel for the Plaintiff.
{8}
Vann’s involvement in these actions while
associated with Andresen & Vann consisted of having several conversations
with another associate regarding procedural matters and reviewing one of the
complaints before it was filed. Vann did
not bill Flick for his work. Vann also had
no direct contact with any Flick representative and has not met Jeff Flick, the
president of the company.
{9}
Vann entered his notice of appearance as
co-counsel for First Decision on November 22, 2005. First Decision is also represented by Mr.
{10}
Flick does not consent to Vann representing First
Decision in these actions.
{11}
Based on these findings of fact, the Court
enters the following
CONCLUSIONS OF
LAW
{12}
Flick’s Motion to Disqualify relies on Rule
1.9(a) of the North Carolina Revised Rules of Professional Conduct (“Rule
1.9(a)”), which provides:
A lawyer who has formerly represented a
client in a matter shall not thereafter represent another person in the same or
a substantially related matter in which that person’s interests are materially
adverse to the interests of the former client unless the former client gives
informed consent, confirmed in writing.
{13}
Thus, the initial question for the Court is
whether Vann “represented” Flick within the meaning of Rule 1.9(a).
{14}
The existence of an attorney-client
relationship is a question of fact for the trial court. See, e.g., Ferguson
v. DDP Pharmacy, Inc., 621 S.E.2d 323, 327 (N.C. Ct. App. 2005). The question is whether the parties’ conduct
“‘was such that an attorney-client relationship could reasonably be
inferred.’” Id. (quoting The
North Carolina State Bar v. Sheffield, 73 N.C. App. 349, 358, 326 S.E.2d
320, 325 (1985)). “[A]n important factor in determining the existence of the
relationship is the client’s subjective belief.” Teja v.
Seran, 68 Wn. App. 793, 796, 846 P.2d 1375, 1377 (1993).
{15}
Given the small size of Vann’s former law
firm, and the fact that the complaints in these actions were signed “Andresen
& Vann,” Flick reasonably could believe that an attorney-client relationship
existed with Vann, in that any of the three lawyers then at the firm would be
available to provide legal advice or assistance to Flick. Flick’s reasonable belief, when coupled with
Vann’s (albeit minimal) involvement in these matters while he was associated
with Andresen & Vann, are sufficient for me to conclude that an
attorney-client relationship existed between Flick and Vann, which, in turn,
warrants Vann’s disqualification.[1]
{16}
Vann is also disqualified by virtue of Rule
1.9(b) of the North Carolina Revised Rules of Professional Conduct (“Rule
1.9(b)”).
{17}
Rule 1.9(b) states:
A lawyer shall not knowingly represent a
person in the same or a substantially related matter in which a firm with which
the lawyer formerly was associated had previously represented a client
(1) whose interests are materially adverse
to that person; and
(2) about whom the lawyer had acquired
information protected by Rules 1.6 and 1.9(c) that is material to the matter;
unless the former client gives informed
consent, confirmed in writing.
{18}
The issue under Rule 1.9(b) is whether Vann
acquired confidential information about Flick during his association with
Andresen & Vann.
{19}
Official Comment 6 to Rule 1.9(b) provides,
in relevant part, that:
Application of paragraph (b) depends on a
situation’s particular facts, aided by inferences, deductions or working
presumptions that reasonably may be made about the way in which lawyers work
together. A lawyer may have general
access to files of all clients of a law firm and may regularly participate in
discussions of their affairs; it should be inferred that such a lawyer in fact
is privy to all information about all the firm’s clients.
See also
{20}
Vann concedes that he had access to all
client files during his employment as an attorney at Andresen & Vann,
although he denies that he acquired any of Flick’s confidential information.
{21}
Nevertheless, in light of (a) Vann’s
unfettered access to client files during his tenure at Andresen & Vann; (b)
the small size of Vann’s former law firm; and (c) the inferences and working
presumptions that may be made about the manner in which lawyers conduct
business, the Court, in accordance with Rule 1.9(b), infers that Vann was privy
to confidential information regarding Flick.
As a result, Vann should be disqualified from representing First
Decision in these actions.
CONCLUSION
{22}
For the reasons set forth above, the Court GRANTS the Plaintiff’s Motion to
Disqualify Vann and Vann Law Firm, P.A. as counsel for Defendant First Decision
Mortgage, Inc. in these actions.
SO ORDERED, this 1st day of February, 2006.
[1] That Vann did not charge a fee for the
work that he performed on Flick’s behalf does not change the result, as the
existence of an attorney-client relationship “‘is not dependent on the payment
of a fee, nor upon the execution of a formal contract.’”