THE BREAKDOWN OF ATTORNEY CLIENT RELATIONSHIP

FRUHLING v. WESTREICH, 2020 NY Slip Op 32080 - NY: Supreme Court June 26, 2020:

"In motion sequence number 009, the law firm of Alonso, Andalkar & Facher, P.C. (AAF) moves to withdraw as counsel for plaintiff Adam Hochfelder and requests a 30-day to stay.

In support, AAF submits the affirmation of Mark J. Alonso, Esq. (NYSCEF Doc. No. [NYSCEF] 197, Affirmation of Alonso.) Alonso asserts that AAF and Hochfelder have "had major disagreements as to strategy, communications with Defendant's counsel, direction of AAF, and client conduct within the context of proceedings." (Id. ¶ 4.) Alonso further states that Hochfelder "has engaged two lawyers (Jed Rubenfeld, Esq. of Yale Law School and Michael Fruhling, Esq.) as respectively his `special counsel' and `private counsel' which has created a further irrevocable deterioration of the attorney-client relationship." (Id.) Additionally, Alonso asserts that Hochfedler "has failed, refused, or has been unable to compensate [AAF] for its time and the costs and disbursements incurred herein." (Id. ¶ 7.) Lastly, Alonso requests that pending the resolution of motion sequence number 008, the court should direct that the terms of December 13, 2019 Confidentiality Stipulation previously signed by the attorneys on behalf of the parties shall govern the treatment of any documents produced by any party or non-party in this case. (Id. ¶ 1.)

Hochfelder does not dispute that AAF has not been paid. (NYSCEF 215, Hochfelder Aff. ¶ 26.) Hochfelder appends the affirmation of his "personal" counsel Michael Fruhling whose role is allegedly "limited to acting as an intermediary between AAF and ... Hochfelder." (NYSCEF 214, Affirmation of Fruhling ¶ 4.) Despite being the "personal attorney" for Hochfelder, Fruhling admits that he nor his firm have been retained for this matter. (Id.) Hochfelder and Fruhling also argue that Hochfelder would be prejudiced if AAF were to withdraw at this juncture because Hochfelder "cannot possibly retain replacement counsel and bring them up to speed prior to ... the meeting with the Taxing Authorities. Nor will there be enough time for them to learn the facts of the case and argue the motions necessary to obtain production of the worksheets ... and comply with the NYS Department of Finance's timetable." (Id. ¶ 25.)

Alonso replies that Fruling was needed to serve as a mediator between Hochfelder and Hochfelder's retained counsel AAF because Hochfelder allegedly fired AAF several times after February 21, 2020. (NYSCEF 216, Second Affirmation of Alonso ¶ 6.) Apparently, Hochfelder fired AAF because he was not pleased with what appears to be AAF's reasonable explanation as to why AAF could not argue a particular motion if this court had not scheduled that motion for argument. (Id.) Nevertheless, Fruhling subsequently communicated to AAF that Alonso wanted AAF to continue representing Hochfelder in this matter. (Id. ¶ 8.)

In yet another bizarre turn of events, Alonso asserts in reply that this court should only make any decision permitting AAF leave to withdraw operative after this court decides motion sequence number 008. (Id. ¶ 15.) The reason is that AAF wishes to continue working on certain matters concerning motion sequence number 008. (Id. ¶ 14.) Indeed, Alonso states, "As much as I and my attorneys with [sic] to be done with this, we believe that the best result would be for us to complete the task for which we were hired — to obtain the explanatory documents and shepherd them safely to Plaintiff's accountant and then to the taxing authorities." (Id. ¶ 13.)

CPLR 321(2) provides, "An attorney of record may withdraw or be changed by order of the court in which the action is pending, upon motion on such notice to the client of the withdrawing attorney, to the attorneys of all other parties in the action or, if a party appears without an attorney, to the party, and to any other person, as the court may direct." "[A]n attorney may withdraw as counsel of record upon a showing of good and sufficient cause, and reasonable notice to the client." (Mason v MTA New York City Transit, 832 NYS2d 153, 154 [1st Dept 2017]).

AAF's requests to this court are contradictory. First, AAF requests permission to withdraw. Second, AAF wishes to continue for an indeterminate period of time ending when documents are delivered to the taxing authority. (NYSCEF 216, Second Affirmation of Alonso ¶ 13.) While AAF may wish to complete certain matters not yet resolved in connection with its representation of Hochfelder, it is clear to this court that continuing this attorney client relationship is impossible. The record demonstrates an attorney and client who are not able to communicate without an intermediary. Clearly, communication between attorney and client has broken down. The client is admittedly not compensating this attorney for its work.

Meanwhile, other attorneys are popping into this case without filing notices of appearances. CPLR 321(a) provides that a party may "prosecute or defend a civil action in person or by an attorney." However, where there is no appearance, an attorney lacks authority to make any motion on behalf of a party. (Worme v Merrill, 24 Misc 2d 1006, 1007 [Sup Ct, Nassau County 1960.) To the extent that a party appears by an attorney, such party may not act in person in the action except by consent of the court. (CPLR 321[a].) Here, neither Rubenfeld, nor Fruhling have filed a notice of appearance for Hochfelder. Until now, only AAF has filed an appearance and only AAF has had authority to represent Hochfelder. While there is legal authority that would recognize the email communications with this court by Rubenfeld (March 17, 18 and 23, 2020) and Fruhling (June 15, 2020) on behalf of Hochfelder as notices of appearance, the attorneys argue against such a reading. As Judge McLaughlin pointed out in his practice commentaries to McKinney's Consolidated Laws of N.Y., Book 7B [CPLR C320:1, p. 363] "(t)here is no express provision as to the contents of a notice of appearance. A notice from an attorney or even a litigant indicating a willingness to litigate any question in connection with the lawsuit should suffice, no matter what form it takes." (Viera v Uniroyal, Inc., 142 Misc 2d 1099, 1108 [Sup Ct, NY County 1988], aff'd, 148 AD2d 349 [1st Dept 1989].) This court prefers clear intent to represent a party.


Hochfelder shall represent himself unless an attorney files a notice of appearance. The court will not recognize or give attention to any communications by attorneys on behalf of Hochfelder unless that attorney has filed with the court in NYSCEF a notice of appearance in this case."

CHANGE OF COUNSEL

This is an issue that came up in a recent consultation. Client wanted to change counsel but old counsel would not release files to Client because of unpaid legal fees. Here is the latest New York State Bar Association Ethics Opinion on this issue which is under the old Rules of Professional Responsibility:

"Opinion 766 — 9/10/03 (35-02)- New York State Bar Association Committee on Professional Ethics - September 10, 2003

Topic: Disposition of files of former client Overrules: N.Y. State 398
(1975)

QUESTION

What is a lawyer's obligation to a former client who requests the files
that were generated in the course of the prior representation?

OPINION DR 9-102(C) provides:

A lawyer shall:

* * * (4) Promptly pay or deliver to the client . . . as requested by
the client . . . the funds, securities, or other properties in the
possession of the lawyer which the client . . . is entitled to
receive.

The question of which "funds, securities, or other properties in the
possession of the lawyer" the client (or successor counsel) is entitled to
receive is generally a question of law, not ethics. See N.Y. State 623
(1991) ("Which documents may be deemed to belong to the lawyer is not
always easy to ascertain; in certain instances, the lawyer's ownership of
such documents may be a complex issue of both law and fact."); Nassau Bar
Op. 94-19 (funds in IOLA account); Nassau Bar Op. 96-13 (funds in escrow
account). The duty to deliver "to the client all papers and property to
which the client is entitled" is also a requirement of withdrawal from
employment. See DR 2-110(A)(2).

Accordingly, the Bar's attention is directed to Sage Realty Corp. v.
Proskauer Rose Goetz & Mendelsohn, 91 N.Y.2d 30 (1997), in which the
Court of Appeals abandoned the distinction "between documents
representing the `end product' of an attorney's services, which belong to
the client, and the attorney's `work product' leading to the creation of
those end product documents, which remains the property of the attorney,"
opting instead for the "majority" view wherein, "upon termination of the
attorney-client relationship, where no claim for unpaid legal fees is
outstanding," the client is "presumptively accord[ed] . . . full access
to the attorney's file on a represented matter with narrow exceptions."
91 N.Y.2d at 34 (citations omitted). The Court cited the final draft of
the American Law Institute Restatement (Third) of the Law Governing
Lawyers § 58 (proposed final draft No. 1, 1996), as follows:

The draft Restatement provides that a former client is to be accorded
access to "inspect and copy any documents possessed by the lawyer
relating to the representation, unless substantial grounds exist to
refuse" (id., § 58[2])

[emphasis supplied].

Even without a request, an attorney is obligated to deliver to the
client, not later than promptly after representation ends, "such
originals and copies of other documents possessed by the lawyer relating
to the representation as the . . . [former] client reasonably needs"
(id., § 58[3], comment d). 91 N.Y.2d at 35. The Committee recognizes
that, consistent with the now rejected "minority view," N.Y. State 398
(1975) suggested that "the client is not entitled to require delivery of
the firm's work product" unless, in the context of the particular
circumstances, the "firm's duty" to the former client or the
"professional courtesy" to be accorded to successor counsel, "are
necessary" to guard the client's interest" (citations omitted).

To the extent that N.Y. State 398 thus reflects a presumption of
non-accessibility that a former client must overcome with respect to a
certain class of documents, that view has been plainly rejected by the
Court of Appeals in Sage Realty and is no longer valid. See also Gamiel
v. Sullivan & Liapakis, P.C., 289 A.D.2d 88 (2001); Getman v. Petro
& Ingalsbe, 266 A.D.2d 688 (1999).

With regard to who bears the cost of file assembly and delivery, we
also note the Court of Appeals statement in Sage Realty that "as a
general proposition, unless a law firm has already been paid for
assemblage and delivery of documents to the client, performing that
function is properly chargeable to the client under customary fee
schedules of the firm, or pursuant to the terms of any governing retainer
agreement." 91 N.Y.2d at 38. Of course, the fee for such services may not
be excessive. DR 2-106(A). See also Deane v. Skadden, Arps, Slate,
Meagher & Flom, N.Y.L.J., Aug. 17, 1998 (Sup.Ct. N.Y. County).

CONCLUSION

As a matter of ethics, upon request by a former client, a lawyer must
promptly turn over or provide access to the files which the former client
is entitled to possess. As a matter of New York law, a former client is
entitled to any document related to the representation unless substantial
grounds exist to refuse access. The lawyer may charge such former client
reasonable fees for assembling and delivering such files, as reflected by
customary fee schedules or any governing retainer agreement."