SECOND DIVISION BARNES, P. J., MILLER and RAY, JJ.
NOTICE: Motions for reconsideration must be physically received in our clerk’s office within ten days of the date of decision to be deemed timely filed. http://www.gaappeals.us/rules/
July 1, 2013
In the Court of Appeals of Georgia A13A0056. HODGE et al. v. URFA-SEXTON, LP et al.
RAY, Judge.
Appellants challenge the trial court’s denial of their motion to disqualify
appellees’ counsel, Insley & Race, LLC. On appeal, appellants argue that the
screening measures implemented by Insley & Race were are not allowed under
Georgia law, or in the alternative, that the screening measures implemented were
inadequate to protect against a conflict of interest that arose when it was discovered
that a paralegal working for its counsel’s firm had been formerly employed with
appellants’ counsel’s firm. Finding no error, we affirm.
This action stems from the shooting death of Monica Renee Williams on
January 3, 2010, at an apartment complex owned and operated by appellees.
Appellants are Belinda Hodge, who is the administratix of Williams’ estate, and Williams’ son, Tavarius NyQuan Williams. Shortly after Williams’ death, appellants
retained the law firm of Hanks Brookes, LLC, to pursue claims associated with
Williams’ death.
Kristi Bussey was employed as a paralegal by Hanks Brookes at the time of
Williams’ death and at the time the law firm was retained by Hodge. While working
at Hanks Brookes, Bussey assisted in the investigation of Williams’ death,
communicated with appellants regarding the case, and participated in meetings
regarding the case, including those discussing the investigation, counsel’s thoughts
regarding the case, and proposed strategy. Bussey even assisted Hodge in becoming
appointed administratrix of Williams’ estate and guardian of Williams’ son.
Additionally, Bussey has personally known Hodge for approximately 10 years and
was friends with Williams and her son.
In March 2010, the law firm of Insley & Race, LLC, was retained by the
Scottsdale Insurance Company to represent appellee URFA-Sexton, LP , in
connection with the instant suit. Insley & Race then proceeded to conduct a pre-suit
investigation and evaluation of the incident. On March 15, 2011, approximately one
year after Insley & Race was retained and six months after the conclusion of the pre-
suit investigation, Bussey interviewed for a paralegal position at Insley & Race. Prior
2 to hiring Bussey, the hiring partner at Insley & Race called and obtained an
employment reference for Bussey from a partner at Hanks Brookes, who did not
disclose any possible conflict of interest. At the time Bussey was hired and came to
work at Insley & Race, she was not aware that the firm had been involved in a pre-
suit investigation of the Williams matter. Accordingly, no screening measures were
implemented to shield her from disclosing any knowledge she possessed regarding
the case at that time.
On October 5, 2011, Bussey became aware of the conflict of interest and
brought it to the attention of the partners at Insley & Race. Insley & Race then
implemented screening measures, including restricting her access to the law firm’s
electronic file and the physical file and instructing her not to have any discussions
regarding the case with anyone at the firm. Bussey provided affidavit testimony that
she had never disclosed nor discussed any confidential information obtained about
the Williams case during her employment with Hanks Brookes to any person at Insley
& Race.
Appellants filed their complaint in this case on November 7, 2011. On
December 6, 2011, two months after becoming aware of the conflict in interest,
defense counsel disclosed Bussey’s employment at their firm to Hanks Brookes. On
3 January 20, 2012, appellants filed a motion to disqualify defense counsel, arguing that
Bussey’s employment with defense counsel was a conflict of interest that required
disqualification of the entire firm. On June 21, 2012, the trial court denied appellants’
motion to disqualify defense counsel, finding that defense counsel had “implemented
appropriate and effective screening measures to protect against any disclosure of
confidential information.” Appellants obtained a certificate of immediate review of
that order and filed an application for interlocutory review in this Court, which was
granted.
1. In their first enumeration of error, appellants assert that the Georgia Rules
of Professional Conduct do not allow screening to overcome a clear conflict of
interest, and thus, the trial court erred in denying their motion to disqualify defense
counsel. We disagree.
On appeal, we review a trial court’s ruling on a motion to disqualify counsel
under an abuse of discretion standard. Cardinal Robotics, Inc. v. Moody, 287 Ga. 18,
22 (694 SE2d 346) (2010).
This Court has not previously addressed the standards governing a
disqualification motion based on the hiring of a nonlawyer employee. With respect
to lawyers, our Supreme Court has adopted a standard stating that a conflict of
4 interest arises whenever counsel undertakes representation of an interest that is
adverse to that of a former client, as long as the matters embraced in the pending suit
are “substantially related” to the factual matters involved in the previous suit. See
Crawford W. Long Mem. Hosp. of Emory Univ. v. Yerby, 258 Ga. 720, 721 (1) (373
SE2d 749) (1988). See also Rules 1.9 and 1.10 of the Georgia Rules of Professional
Conduct. This strict rule is based on conclusive presumption that confidences and
secrets were imparted to the attorney during the prior representation and that such
representation would “create[] an impermissible appearance of impropriety.” See
Yerby at 722 (3).
Appellants argue that the standards applied to disqualify lawyers should also
apply to paralegals. Thus, appellants urge that the entire firm of Insley & Race should
be automatically disqualified from the present case because of the confidences Bussey
obtained while working at Hanks Brookes.
We agree that a paralegal who has actually worked on a case must be subject
to the conclusive presumption that confidences and secrets were imparted during the
course of the paralegal’s work on the case. See Phoenix Founders Inc. v. Marshall,
887 S.W.2d 831, 834 (Tex. 1994). “This presumption serves to prevent the moving
party from being forced to reveal the very confidences sought to be protected.”
5 (Citation omitted.) Id. We disagree, however, with appellants’ argument that
paralegals should be subject to the same standards applicable to lawyers under the
Georgia Rules of Professional Conduct, and therefore, they should conclusively be
presumed to share confidential information with members of their firms. See Georgia
Rule of Professional Conduct 1.10.1 Rule 5.3 (a) of the Georgia Rules of Professional
Conduct, governing responsibilities regarding nonlawyer assistants, requires a lawyer
having direct supervisory authority over a nonlawyer to make reasonable efforts to
ensure that the nonlawyer’s conduct is compatible with the
professional obligations of the lawyer. “Thus, to the extent that the [Georgia Rules
of Professional Conduct] prohibit a lawyer from revealing confidential information
Free access — add to your briefcase to read the full text and ask questions with AI
SECOND DIVISION BARNES, P. J., MILLER and RAY, JJ.
NOTICE: Motions for reconsideration must be physically received in our clerk’s office within ten days of the date of decision to be deemed timely filed. http://www.gaappeals.us/rules/
July 1, 2013
In the Court of Appeals of Georgia A13A0056. HODGE et al. v. URFA-SEXTON, LP et al.
RAY, Judge.
Appellants challenge the trial court’s denial of their motion to disqualify
appellees’ counsel, Insley & Race, LLC. On appeal, appellants argue that the
screening measures implemented by Insley & Race were are not allowed under
Georgia law, or in the alternative, that the screening measures implemented were
inadequate to protect against a conflict of interest that arose when it was discovered
that a paralegal working for its counsel’s firm had been formerly employed with
appellants’ counsel’s firm. Finding no error, we affirm.
This action stems from the shooting death of Monica Renee Williams on
January 3, 2010, at an apartment complex owned and operated by appellees.
Appellants are Belinda Hodge, who is the administratix of Williams’ estate, and Williams’ son, Tavarius NyQuan Williams. Shortly after Williams’ death, appellants
retained the law firm of Hanks Brookes, LLC, to pursue claims associated with
Williams’ death.
Kristi Bussey was employed as a paralegal by Hanks Brookes at the time of
Williams’ death and at the time the law firm was retained by Hodge. While working
at Hanks Brookes, Bussey assisted in the investigation of Williams’ death,
communicated with appellants regarding the case, and participated in meetings
regarding the case, including those discussing the investigation, counsel’s thoughts
regarding the case, and proposed strategy. Bussey even assisted Hodge in becoming
appointed administratrix of Williams’ estate and guardian of Williams’ son.
Additionally, Bussey has personally known Hodge for approximately 10 years and
was friends with Williams and her son.
In March 2010, the law firm of Insley & Race, LLC, was retained by the
Scottsdale Insurance Company to represent appellee URFA-Sexton, LP , in
connection with the instant suit. Insley & Race then proceeded to conduct a pre-suit
investigation and evaluation of the incident. On March 15, 2011, approximately one
year after Insley & Race was retained and six months after the conclusion of the pre-
suit investigation, Bussey interviewed for a paralegal position at Insley & Race. Prior
2 to hiring Bussey, the hiring partner at Insley & Race called and obtained an
employment reference for Bussey from a partner at Hanks Brookes, who did not
disclose any possible conflict of interest. At the time Bussey was hired and came to
work at Insley & Race, she was not aware that the firm had been involved in a pre-
suit investigation of the Williams matter. Accordingly, no screening measures were
implemented to shield her from disclosing any knowledge she possessed regarding
the case at that time.
On October 5, 2011, Bussey became aware of the conflict of interest and
brought it to the attention of the partners at Insley & Race. Insley & Race then
implemented screening measures, including restricting her access to the law firm’s
electronic file and the physical file and instructing her not to have any discussions
regarding the case with anyone at the firm. Bussey provided affidavit testimony that
she had never disclosed nor discussed any confidential information obtained about
the Williams case during her employment with Hanks Brookes to any person at Insley
& Race.
Appellants filed their complaint in this case on November 7, 2011. On
December 6, 2011, two months after becoming aware of the conflict in interest,
defense counsel disclosed Bussey’s employment at their firm to Hanks Brookes. On
3 January 20, 2012, appellants filed a motion to disqualify defense counsel, arguing that
Bussey’s employment with defense counsel was a conflict of interest that required
disqualification of the entire firm. On June 21, 2012, the trial court denied appellants’
motion to disqualify defense counsel, finding that defense counsel had “implemented
appropriate and effective screening measures to protect against any disclosure of
confidential information.” Appellants obtained a certificate of immediate review of
that order and filed an application for interlocutory review in this Court, which was
granted.
1. In their first enumeration of error, appellants assert that the Georgia Rules
of Professional Conduct do not allow screening to overcome a clear conflict of
interest, and thus, the trial court erred in denying their motion to disqualify defense
counsel. We disagree.
On appeal, we review a trial court’s ruling on a motion to disqualify counsel
under an abuse of discretion standard. Cardinal Robotics, Inc. v. Moody, 287 Ga. 18,
22 (694 SE2d 346) (2010).
This Court has not previously addressed the standards governing a
disqualification motion based on the hiring of a nonlawyer employee. With respect
to lawyers, our Supreme Court has adopted a standard stating that a conflict of
4 interest arises whenever counsel undertakes representation of an interest that is
adverse to that of a former client, as long as the matters embraced in the pending suit
are “substantially related” to the factual matters involved in the previous suit. See
Crawford W. Long Mem. Hosp. of Emory Univ. v. Yerby, 258 Ga. 720, 721 (1) (373
SE2d 749) (1988). See also Rules 1.9 and 1.10 of the Georgia Rules of Professional
Conduct. This strict rule is based on conclusive presumption that confidences and
secrets were imparted to the attorney during the prior representation and that such
representation would “create[] an impermissible appearance of impropriety.” See
Yerby at 722 (3).
Appellants argue that the standards applied to disqualify lawyers should also
apply to paralegals. Thus, appellants urge that the entire firm of Insley & Race should
be automatically disqualified from the present case because of the confidences Bussey
obtained while working at Hanks Brookes.
We agree that a paralegal who has actually worked on a case must be subject
to the conclusive presumption that confidences and secrets were imparted during the
course of the paralegal’s work on the case. See Phoenix Founders Inc. v. Marshall,
887 S.W.2d 831, 834 (Tex. 1994). “This presumption serves to prevent the moving
party from being forced to reveal the very confidences sought to be protected.”
5 (Citation omitted.) Id. We disagree, however, with appellants’ argument that
paralegals should be subject to the same standards applicable to lawyers under the
Georgia Rules of Professional Conduct, and therefore, they should conclusively be
presumed to share confidential information with members of their firms. See Georgia
Rule of Professional Conduct 1.10.1 Rule 5.3 (a) of the Georgia Rules of Professional
Conduct, governing responsibilities regarding nonlawyer assistants, requires a lawyer
having direct supervisory authority over a nonlawyer to make reasonable efforts to
ensure that the nonlawyer’s conduct is compatible with the
professional obligations of the lawyer. “Thus, to the extent that the [Georgia Rules
of Professional Conduct] prohibit a lawyer from revealing confidential information
. . . they also prohibit a supervising lawyer from ordering, encouraging, or permitting
a nonlawyer to reveal such information.” Phoenix Founders, Inc., supra.
1 Georgia Rule of Professional Conduct 1.9 (a) provides that 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. . . .” Rule 1.10 (a) imputes that lawyer’s disqualification to the entire firm, stating that “[w]hile lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rule[] . . . 1.9.”
6 Citing to the Alabama Rules of Professional Conduct and an advisory opinion,
Alabama State Bar, Formal Opinion 2002-01,2 the appellants urge us to adopt the
approach endorsed by some jurisdictions, which prohibits using screening measures
to prevent a nonlawyer’s conflict of interest from disqualifying an entire firm.
Appellants argue that Georgia has implicitly disapproved the use of screening
measures because the Georgia Rules of Professional Conduct did not specifically
adopt the screening measures set forth in American Bar Association Model Rules
1.10. However, we find this unpersuasive.
The American Bar Association’s Committee on Professional Ethics has
considered whether a law firm that hires a paralegal may continue representing clients
whose interests conflict with interests of the former employer’s clients on whose
matters the paralegal has worked. ABA Comm. On Ethics and Professional
Responsibility, Informal Op. 88-1526 (1988). After surveying case law and ethics
opinions from a number of jurisdictions, the Committee concluded that the new firm
need not be disqualified, as long as the firm and the paralegal strictly adhere to the
2 In its advisory opinion, the Alabama State Bar relied heavily on the fact that the Supreme Court of Alabama had taken the position that the “Chinese wall” or screening concept should not apply to practicing lawyers. See Roberts v. Hutchins, 572 So.2d 1231 (Ala. 1990).
7 screening process set forth in its opinion, and as long as the paralegal does not reveal
any information relating to the former employer’s clients to any person in the
employing firm. Id. A number of courts have since relied on the ABA’s opinion to
allow continued representation under similar conditions. See Smart Indus. Corp. v.
Superior Court, 179 Ariz. 141, 148 (C) (876 P.2d 1176) (1994); In re Complex
Asbestos Litigations v. Owens-Corning Fiberglass Corp., 232 Cal. App.3d 572, 595-
596 (283 Cal. Rptr. 732) (1991).3
These decisions highlight a concern “regarding the mobility of paralegals and
other nonlawyers. A potential employer might well be reluctant to hire a particular
nonlawyer if doing so would automatically disqualify the entire firm from ongoing
3 See also Restatement (Third) of Law Governing Lawyers, § 123, Comment (f) (“[e]ven if the [nonlawyer employee] learned the [confidential] information in circumstances that would disqualify a lawyer . . . the person should not be regarded as a lawyer for purposes of the imputation rules of this Section”). For more information regarding jurisdictions adopting this approach, see Peter H. Geraghty and Susan J. Michmerhuizen, Screen Nonlawyer Employees For Conflicts of Interest, American Bar Association, Your ABA, June 2012 e-newsletter; Cecile C. Edwards, Law Firm Disqualification and NonLawyer Employees: A Proposal For A Consistent Analysis, 26 Miss. C. L. Rev. 163, 167-176 (III)-(IV) (2007); M. Peter Moser, Chinese Walls: A Means of Avoiding Law Firm Disqualification When a Personally Disqualified Lawyer Joins the Firm, 3 Geo. J. Legal Ethics 399, 406-407 (1990).
8 litigation.” Phoenix Founders, Inc., supra at 835.4 Weighing these concerns, the ABA
concluded that screening a conflicted nonlawyer from the case was adequate, and that
“any restrictions on the nonlawyer’s employment should be held to the minimum
necessary to protect confidentiality of client information.” ABA Informal Op. 88-
1526 at 2. Further, we note that Georgia has long held that
[t]he right to counsel is an important interest which requires that any curtailment of the client’s right to counsel of choice be approached with great caution. Disqualification has an immediate adverse effect on the client by separating him from counsel of his choice, and inevitably causes delay. A client whose attorney is disqualified may suffer the loss of time and money in finding new counsel and may lose the benefit of
4 A rigid rule requiring that the hiring firm is automatically disqualified
raises important questions, not the least of which is the anomalous proposition that the more skilled a legal assistant or other employee becomes to the employer and the more information he or she acquires on cases in the firm, such assistant becomes less valuable to other firms with significant caseloads with the current employer . . . A literal reading of this rigid rule would stymie a legal assistant’s career, or at the very least make them ‘Typhoid Marys,’ unemployable by firms practicing in specialized areas of the law where the employees are most skilled and experienced.
(Citation and punctuation omitted.) Smart Indus. Corp, supra at 148-149 (C).
9 its longtime counsel’s specialized knowledge of its [case]. Because of the right involved and the hardships brought about, disqualification of chosen counsel should be seen as an extraordinary remedy and should be granted sparingly.
(Citations and punctuation omitted.) Bernocchi v. Forcucci, 279 Ga. 460, 462 (2)
(614 SE2d 775) (2005). Accord Harris v. The Southern Christian Leadership
Conference, Inc., 313 Ga. App. 363, 369 (7) (721 SE2d 906) (2011). These concerns,
however, must be balanced against the concerns articulated by appellant, i. e., “the
need to maintain ethical standards of professional responsibility” and the concern for
“the preservation of public trust in the administration of justice and the integrity of
the bar.” (Citation omitted.) Smart Indus. Corp., supra at 149 (C).
Using this balanced approach, this Court shares the concerns regarding the
mobility of nonlawyer employees and the protection of a client’s right to his choice
of counsel expressed by the ABA and by the appellees. We agree that client
confidences may be appropriately safeguarded if a firm hiring a paralegal from
another firm takes appropriate steps to screen that paralegal in compliance with the
screening measures adopted by the Georgia Rules of Professional Conduct in other
contexts, namely in Rule 1.11, governing successive government and private
employment, and Rule 1.12, governing former judges or arbitrators. Those screening
10 guidelines, set forth in Rule 1.0 (p), and Comments 8-10 to Rule 1.0, state that the
disqualified person should not
communicate with any of the other lawyers in the firm with respect to the matter. Similarly, other lawyers in the firm who are working on the matter should be informed that the screening is in place and that they may not communicate with the personally disqualified [employee] with respect to the matter. Additional screening measures that are appropriate for the particular matter will depend on the circumstances. To implement, reinforce and remind all affected lawyers of the presence of screening, it may be appropriate for the firm to undertake such procedures as a written undertaking by the screened [employee] to avoid any communication with other firm personnel and any contact with any firm files or other material relating to the matter, written notice and instructions to all other firm personnel forbidding any communication with the screened [employee] relating to the matter, denial of access by the screened [employee] to firm files or other materials relating to the matter and periodic reminders of the screen to the screened [employee] and all other firm personnel. In order to be effective, screening measures must be implemented as soon as practical after a lawyer or law firm knows or reasonably should know that there is a need for screening.
These precautions would tend to reduce any danger that the nonlawyer might
share confidential information with members of the law firm. Therefore, the
challenged firm may rebut any presumption that a nonlawyer shared confidential
11 information by showing that sufficient precautions have been taken to guard against
any disclosure of confidences. See Smart Ind. Corp., supra at 149-150.
However, we adopt the American Bar Association’s precaution that these
screening practices cannot be used to avoid disqualification in the following
circumstances: (1) when information relating to the representation of an adverse
client has in fact been disclosed, or (2) when screening would be ineffective or the
nonlawyer necessarily would be required to work on the other side of a matter that is
the same or substantially related to the matter on which the nonlawyer has worked.
See ABA Op. 88-1526. Ordinarily, however, disqualification is not required so long
as “the practical effect of formal screening has been achieved.” In re Complex
Asbestos Litigation, supra at 596.
2. Appellants argue that if Georgia allows screening measures to be
implemented to avoid imputed disqualification arising from the change in
employment by a nonlawyer employee, that the trial court erred in denying their
motion to disqualify because Insley & Race did not institute screening measures in
a timely manner. We disagree.
Bussey provided affidavit testimony that she began working at Insley & Race
in March 2011, but that at the time of her hiring she was not aware that the firm was
12 involved in a pre-suit investigation of the Williams matter. Thus, no screening
measures were implemented to shield her from knowledge of the case at the time of
her hiring. On October 5, 2011, Bussey discovered the conflict of interest and brought
it to the attention of the partners at Insley & Race, who implemented screening
measures at that time. Those screening measures included restricting her access to the
law firm’s electronic file and the physical file, and instructing her not to have any
discussions regarding the case with anyone at the firm. Bussey provided affidavit
testimony that she had never disclosed nor discussed any confidential information
obtained about the Williams case during her employment with Hanks Brookes to any
person at Insley & Race.
Based on this evidence, the trial court concluded that the screening measures
implemented by Insley & Race were adequate and that Bussey had not divulged any
confidential information to the firm prior to the implementation of the screening
measures. As stated above, we review a trial court’s ruling on a motion to disqualify
under an abuse of discretion standard. Cardinal Robotics, Inc., supra. “The question
on review is whether there is any evidence to support the trial court’s finding of
facts.” Southern Shipping Co. v. Oceans Intl. Corp., 174 Ga. App. 91, 94 (2) (329
SE2d 263) (1985). Having reviewed the record, we find that the trial court’s findings
13 are not clearly erroneous. See Daines v. Alcatel, S.A. Inc., 194 F.R.D. 678, 682-683
(II) (B) (E.D. Wash. 2000) (disqualification not required if firm provides “convincing
evidence” that no confidential information passed before the institution of the screen
and the subsequently erected screen is adequate).
Judgment affirmed. Barnes, P. J., and Miller, J., concur.