Lawyer As Witness Rule Requires Disqualification

Disqualification of counsel in a guardianship matter was affirmed by the New York Appellate Division for the First Judicial Department

While the existence of a clear attorney-client relationship was not established between the [Allegedly Incapacitated Person]s and counsel for the cross-petitioners and respondent (see HSBC Bank USA, N.A. v Santos, 185 AD3d 475, 477 [1st Dept 2020]), Supreme Court correctly found disqualification appropriate under rule 3.7 (a) of the Rules of Professional Conduct. Rules of Professional Conduct (22 NYCRR 1200.0) rule 3.7 (a) provides that an attorney may not act as an advocate in a matter where they are “likely to be a witness on a significant issue of fact” unless “the testimony relates solely to an uncontested issue,” “disqualification of the lawyer would work substantial hardship to the client,” “the testimony will relate solely to a matter of formality, and there is no reason to believe that substantial evidence will be offered in opposition to the testimony,” or “the testimony is authorized by the tribunal.” Under rule 3.7(b) of the Rules of Professional Conduct (22 NYCRR 1200.0), an attorney also may not act as an advocate before a tribunal if another attorney “in the lawyer’s firm is likely to be called as a witness on a significant issue other than on behalf of the client, and it is apparent that the testimony may be prejudicial to the client” or “the lawyer is precluded from doing so by rule 1.7 or rule 1.9.”

At issue in these contested guardianship proceedings is whether the AIPs require guardians for the management of their property and personal needs, and if so, who should serve as the guardians and what powers should be conveyed. As noted by the trial court, petitioner (a grandchild of the AIPs) alleges, among other things, exploitation of the AIPs by the AIPs’ children. Cross-petitioners seek dismissal of the petitions, arguing that the AIPs have “available resources” under Mental Hygiene Law § 81.03(e) such that no guardian is needed, but that in the event the court determines otherwise, Ronald E. and Susan E. should be appointed as co-guardians.

The trusts in this matter hold interests in a number of limited liability companies controlling numerous real estate holdings. Given the proximity in time of the signing of the change of the trustee designations and subsequent decanting to the filing of these guardianship proceedings, it is likely that the [Goetz Fitzpatrick]  attorneys identified by Florence E. will provide testimony on a number of issues. These issues include the circumstances surrounding the changes to the trusts and the execution of the resignation documents, the capacity of the AIPs at the time of the signing, and whether there was an exercise of undue influence on the part of any of the successor trustees in the resignations that removed the AIPs’ control as trustees and the subsequent decanting. Under the unique circumstances of this case, disqualification pursuant to rule 3.7 of the Rules of Professional Conduct is appropriate.

(Mike Frisch)