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May 31, 2005

Cal West Nurseries, Inc. v. Superior Court (A.J. West Ranch LLC) (2005) 129 Cal.App.4th 1170

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The Fourth District holds that a law firm is disqualified when it represents one client against another in unrelated cases.  The conflict was not cured when the law firm withdrew from the representation on causes of action between the two clients.

A.J.  West Ranch LLC (“Ranch”) associated Lewis Brisbois Bisgaard & Smith, LLP (“LBBS”) as co-counsel on a cross-complaint for equitable indemnity and contribution against Cal West Nurseries, Inc.  (“Cal West”).  LBBS was also associated as co-counsel on behalf of Brongo Construction (“Brongo”) and Ranch on a cross-complaint against them by Cal West.  When the associations were filed, LBBS also represented Cal West in another, unrelated action.

When Cal West objected to LBBS’ representation of Ranch and Brongo, LBBS cancelled depositions and filed a “disassociation of counsel” in which it stated it ceased representing Ranch as to its cross-complaint against Cal West and as to Cal West’s cross-complaint against Ranch and Brongo.  LBBS continued to represent Ranch and Brongo as to the cross-complaints adverse to all other parties in the matter.

The trial court denied Cal West’s motion to disqualify LBBS from continuing to represent Ranch and Cal West appealed.

The Court of Appeal noted that absent informed, written consent, a lawyer cannot concurrently represent one client against another in an unrelated matter.  It is immaterial whether the lawyer possesses confidential information that could be misused to the prejudice of either client.  The primary value at stake in the case of simultaneous representation is the attorney’s duty– and the client’s legitimate expectation – of loyalty.

Although LBBS no longer represented Ranch on causes of action between Ranch and Cal West, LBBS remained in the action to represent Ranch against other parties.  Ranch remained adverse to Cal West by virtue of its cross-complaint against Cal West, which was not eliminated when LBBS withdrew from representing Ranch on the cross‑complaint.  Thus, LBBS represented two opposing clients in the same action.

The Court found that there was a sufficient adverse relationship between Ranch and Cal West to disqualify LBBS.  The duty of undivided loyalty LBBS owes Cal West overcomes Ranch’s right to retain counsel of its choice.

Comment: Withdrawal from a portion of representation of a client who has an adverse relationship with another concurrently represented client is no substitute for the informed, written consent of the clients.

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