MacPherson-Pomeroy v. North American Company for Life and Health Insurance

Opinion

1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF CALIFORNIA 8 9 BARBARA MACPHERSON-POMEROY, No. 1:20-cv-00092-DAD-BAM

10 Plaintiff, FINDINGS AND RECOMMENDATIONS 11 v. REGARDING MOTION OF ATTORNEY OF

12 NORTH AMERICAN COMPANY FOR THIRD-PARTY DEFENDANT DEBANEE LIFE AND HEALTH INSURANCE, an MACPHERSON UDALL TO WITHDRAW AS 13 Iowa corporation; and DOES 1 through COUNSEL 100, 14 (Doc. 61) 15 ______ ______D __e _fe _n _d _a _n _t _s _. ____________ NORTH AMERICAN COMPANY FOR FOURTEEN (14) DAY DEADLINE 16 LIFE AND HEALTH INSURANCE,

17 Counterclaim Plaintiff,

18 v.

19 BARBARA MACPHERSON-POMEROY,

20 Counterclaim Defendant. __________________________________ 21 NORTH AMERICAN COMPANY FOR LIFE AND HEALTH INSURANCE, 22 Third-Party Plaintiff, 23 v. 24 MELANIE RODRIGUEZ and DEBANEE 25 MACPHERSON UDALL,

26 Third-Party Defendants.

28 1 Pending before the Court is the motion to withdraw as counsel filed by C. Russell Georgeson 2 of the Georgeson Law Offices, counsel of record for third-party defendant Debanee MacPherson 3 Udall, on February 22, 2021. (Doc. 61.) The matter was referred to the undersigned magistrate judge 4 for issuance of findings and recommendations in accordance with 28 U.S.C. § 636(b)(1)(B) and (C). 5 (Doc. 64.) 6 The matter was heard on March 12, 2021, before United States Magistrate Judge Barbara A. 7 McAuliffe. Counsel Marshall Whitney appeared by telephone on behalf of plaintiff Barbara 8 MacPherson-Pomeroy. Counsel Kaitlyn Luther appeared by telephone on behalf of defendant North 9 American Company for Life and Health Insurance. Counsel C. Russell Georgeson appeared by 10 telephone on behalf of third-party defendant Debanee MacPherson Udall and as movant. Debanee 11 MacPherson Udall did not appear. Third-party defendant Melanie Rodriguez also did not appear. 12 Having considered the moving papers, arguments and record in this action, it is recommended 13 that the motion to withdraw as counsel for third-party defendant Debanee MacPherson Udall be 14 granted. 15 BACKGROUND 16 Plaintiff Barbara MacPherson-Pomeroy initiated this action on December 16, 2019, in the 17 Fresno County Superior Court. Plaintiff sought damages in connection with her claim for life 18 insurance benefits under a life insurance policy. The matter was removed to this court on January 17, 19 2020, by defendant North American Company for Life and Health Insurance. (Doc. 1.) 20 On February 21, 2020, defendant filed a counterclaim against Barbara MacPherson-Pomeroy 21 and third-party complaint in interpleader against Melanie Rodriguez and Debanee MacPherson Udall. 22 (Doc. 14.) Barbara MacPherson-Pomeroy answered the counterclaim on March 13, 2020. (Doc. 19.) 23 Melanie Rodriguez, in pro per, responded to the third-party complaint and indicated that she is not 24 challenging the payment of the policy benefits to Barbara MacPherson-Pomeroy. (Doc. 21.) Debanee 25 MacPherson Udall, through counsel, answered the third-party complaint on April 21, 2020. (Doc. 22.) 26 On February 10, 2021, third-party defendant Debanee MacPherson Udall filed a proposed 27 substitution of attorney to represent herself in this matter. (Doc. 53.) The court denied the proposed 28 substitution of attorney because it did not comply with Local Rule 182 and indicated that in order to 1 withdraw leaving the client in propria persona counsel must comply with Local Rule 182. (Doc. 54.) 2 On February 19, 2021, the Court issued an Amended Scheduling Conference Order. (Doc. 60.) 3 As set forth in the amended order, non-expert discovery, for the limited purpose of completing the 4 depositions of witness Alicia Gros and Defendant’s representatives, has been extended to April 30, 5 2021. Additionally, the deadline for initial expert disclosures is May 14, 2021, the deadline for 6 supplemental expert disclosures is June 1, 2021, the deadline for completion of expert discovery is 7 July 9, 2021, and the deadline for filing dispositive motions is June 30, 2021. A pretrial conference is 8 scheduled for November 8, 2021. (Id.) 9 On February 22, 2021, counsel C. Russell Georgeson filed the instant motion to withdraw as 10 counsel for third-party defendant Debanee MacPherson Udall due to nonpayment of legal fees and 11 expenses. (Doc. 61.) On February 24, 2021, counsel submitted a declaration confirming that Ms. 12 Udall acknowledged receipt of the motion to withdraw on February 23, 2021. (Doc. 63 at ¶ 2.) 13 Following referral of the motion, the court, by way of minute order, re-set the motion to withdraw for 14 hearing on March 12, 2021, and directed counsel seeking to withdraw to serve the minute order on Ms. 15 Udall. (Doc. 65.) Counsel submitted a proof of service indicating Ms. Udall was served with the 16 minute order by e-mail and mail on February 26, 2021. (Doc. 66.) 17 On March 2, 2021, plaintiff Barbara MacPherson-Pomeroy filed a statement of non-opposition 18 to the motion to withdraw as counsel. (Doc. 67.) No other opposition or response to the motion has 19 been filed. At the hearing, defendant North American Company for Life and Health Insurance 20 indicated it had no objection to the motion to withdraw. 21 DISCUSSION 22 The decision to grant or deny an attorney’s motion to withdraw is committed to the discretion 23 of the trial court. See Thomas v. Experian Info. Sols., Inc., No. 2:13-cv-02674-MCE-CKD, 2014 WL 24 7359180, at *1 (E.D. Cal. Dec. 23, 2014) (“Whether to grant leave to withdraw is subject to the sound 25 discretion of the Court and ‘may be granted subject to such appropriate conditions as the Court deems 26 fit.’”); Canandaigua Wine Co., Inc. v. Moldauer, No. 1:02-cv-06599 OWW DLB, 2009 WL 89141, *1 27 (E.D. Cal. Jan. 14, 2009) (finding that the decision to grant or deny counsel’s motion to withdraw is 28 committed to the discretion of the trial court). “In ruling on a motion to withdraw, some courts have 1 looked to the following factors: 1) the reasons why withdrawal is sought; 2) the prejudice withdrawal 2 may cause to other litigants; 3) the harm withdrawal might cause to the administration of justice; and 3 4) the degree to which withdrawal will delay the resolution of the case.” Canandaigua, 2009 WL 4 89141 at *1. 5 Additionally, in the Eastern District of California, attorneys representing parties to a civil case 6 are subject to Local Rule 182(d) which provides: 7 Unless otherwise provided herein, an attorney who has appeared may not withdraw leaving the client in propria persona without leave of court upon noticed motion and 8 notice to the client and all other parties who have appeared. The attorney shall provide an affidavit stating the current or last known address or addresses of the client and the 9 efforts made to notify the client of the motion to withdraw. Withdrawal as attorney is 10 governed by the Rules of Professional Conduct of the State Bar of California, and the attorney shall conform to the requirements of those Rules. The authority and duty of the 11 attorney of record shall continue until relieved by order of the Court issued hereunder. Leave to withdraw may be granted subject to such appropriate conditions as the Court 12 deems fit. 13 L.R. 182(d). 14 The Rules of Professional Conduct of the State Bar of California provide that an attorney may 15 withdraw from representation if “the client breaches as material term of an agreement with, or 16 obligation, to the lawyer relating to the representation, and the lawyer has given the client a reasonable 17 warning after the breach that the lawyer will withdraw unless the client fulfills the agreement or 18 performs the obligation” Cal R. Prof. Conduct 1.16(b)(5). However, a lawyer may not terminate 19 representation until the lawyer “has taken reasonable steps to avoid reasonably foreseeable prejudice 20 to the rights of the client, such as giving the client sufficient notice to permit the client to retain other 21 counsel.” Cal. R. Prof. Conduct 1.16(d). 22 ANALYSIS 23 Here, counsel moves to withdraw on the grounds that third-party defendant “has breached her 24 agreement and obligation to pay legal fees and fees as incurred and billed.” (Doc. 61-1 at 4.) 25 Attorney Georgeson has submitted a declaration stating that his office entered into a written Retainer 26 Agreement with Ms. Udall on April 9, 2020. By that agreement, Ms. Udall agreed to pay legal fees 27 and expenses on a billed basis to the law firm in exchange for representation in this matter. The 28 1 agreement also provided the right for the law firm to withdraw if payment was not made within 30 2 days of billing. (Doc. 61-2, Georgeson Decl. at ¶ 2.) Ms. Udall reportedly failed to make timely 3 payment pursuant to the Retainer Agreement and carries several months’ unpaid balance. (Id. at ¶ 3.) 4 According to attorney Georgeson, the law firm has “made reasonable efforts to obtain payment from 5 [Ms.] Udall, including: various e-mails, telephone conferences and delivering for her signature a 6 Substitution of Attorneys, which she signed and returned.” (Id. at ¶ 3.) Attorney Georgeson further 7 declares that the law firm has taken reasonable steps to avoid reasonably foreseeable prejudice to Ms. 8 Udall, including giving her “several months’ notice failure to pay for legal fees and expenses would 9 result in Georgeson Law Offices withdrawing as counsel of record and to permit her time to retain 10 other counsel/other.” (Id. at ¶ 4.) 11 As to the first factor, the reasons for withdrawal, the Court finds that counsel has demonstrated 12 good cause for permissive withdrawal. “It is well established that failure to pay attorney’s fees 13 provides grounds for withdrawal.” Advanced Steel Recovery, LLC v. X-Body Equip., Inc., No. 2:16- 14 cv-00148 KJM EFB, 2019 WL 5063460, at *2 (E.D. Cal. Oct. 9, 2019); see also Johnson v. Serenity 15 Transportation, Inc., No. 15-cv-02004-JSC, 2020 WL 5500375, at *1 (N.D. Cal. Sept. 11, 2020) 16 (“Failure to pay attorney’s fees provides a sufficient basis on which to grant a request to withdraw.”) 17 (citation omitted). Further, Ms. Udall’s apparent consent to withdrawal, evidenced by her executed 18 and filed Substitution of Attorney form, (Doc. 53), provides additional support for withdrawal. 19 Advanced Steel, 2019 WL 5063450, at *2 (“And when a party willingly consents to withdrawal, all the 20 more reason exists to permit withdrawal.”). 21 Second, as to prejudice that counsel’s withdrawal may cause other litigants, the court notes that 22 plaintiff does not oppose the pending motion or otherwise assert prejudice. No other party has 23 opposed withdrawal. In the moving papers, counsel contends that withdrawal will cause no prejudice 24 to the other parties. Ms. Udall is one of two third-party defendants interpleaded in this action on the 25 ground that she may have a claim to life insurance proceeds. Discovery issues are ongoing between 26 plaintiff and defendant that do not involve Ms. Udall and plaintiff has reportedly stated her intent to 27 file a motion for summary adjudication that she claims will establish her entitlement to the insurance 28 proceeds. (Doc. 61-1.) Given the current deadlines in this case, the court does not find that there will 1 be prejudice to the other litigants by counsel’s withdrawal. This factor therefore does not weigh 2 against withdrawal. 3 Third, as to harm that counsel’s withdrawal might cause to the administration of justice, and 4 fourth, as to delay, counsel asserts that withdrawal as Ms. Udall’s counsel will cause “no harm to the 5 administration of justice [ ] and no delay to the resolution of this action.” (Doc. 61-1 at 4.) The court 6 finds withdrawal will not cause harm to the administration of justice or unduly delay the resolution of 7 this case. This matter is not set for trial. As discussed above, the remaining discovery issues do not 8 involve Ms. Udall and plaintiff’s anticipated motion for summary adjudication may address 9 entitlement to the insurance proceeds or otherwise narrow the issues for trial. The deadline for any 10 such motion is June 30, 2021. Further, by separate order, the court set a status conference to advise 11 Ms. Udall regarding the status of this action. 12 Accordingly, the court finds that consideration of the factors weighs in favor of granting 13 the motion to withdraw. 14 CONCLUSION AND RECOMMENDATION 15 For the reasons stated, IT IS HEREBY RECOMMENDED as follows: 16 1. The Motion of Attorney of Third-Party Defendant Debanee MacPherson Udall to 17 Withdraw as Counsel (Doc. 61) be granted; 18 2. Third-party defendant Debanee MacPherson Udall be substituted in propria persona 19 in place and stead of C. Russell Georgeson and the Georgeson Law Offices; and 20 3. The Clerk of the Court be directed to update the docket with the contact information 21 of third-party defendant Debanee MacPherson Udall at her last known address: 22 Debanee MacPherson Udall 12246 Highway 62 23 Eagle Point, Oregon 97524

24 25 Additionally, IT IS HEREBY ORDERED that counsel for third-party defendant Debanee 26 MacPherson Udall shall serve her with a copy of these findings and recommendations and file 27 proof of service with the court. 28 /// 1 These findings and recommendations are submitted to the United States District Judge 2 assigned to the case, pursuant to the provisions of Title 28 U.S.C. § 636(b)(l). Within fourteen (14) 3 days after being served with these findings and recommendations, the parties may file written 4 objections with the Court. Such a document should be captioned “Objections to Magistrate Judge’s 5 Findings and Recommendations.” The parties are advised that failure to file objections within the 6 specified time may result in the waiver of rights on appeal. Wilkerson v. Wheeler, 772 F.3d 834, 838- 7 39 (9th Cir. 2014) (citing Baxter v. Sullivan, 923 F.2d 1391, 1394 (9th Cir. 1991)). 8 9 IT IS SO ORDERED.

10 Dated: March 12, 2021 /s/ Barbara A. McAuliffe _ 11 UNITED STATES MAGISTRATE JUDGE

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