Mills v. Hausmann-McNally

992 F. Supp. 2d 885, 2014 WL 129280, 2014 U.S. Dist. LEXIS 4407
CourtDistrict Court, S.D. Indiana
DecidedJanuary 14, 2014
DocketNo. 1:13-cv-00044-SEB-DKL
StatusPublished
Cited by11 cases

This text of 992 F. Supp. 2d 885 (Mills v. Hausmann-McNally) is published on Counsel Stack Legal Research, covering District Court, S.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mills v. Hausmann-McNally, 992 F. Supp. 2d 885, 2014 WL 129280, 2014 U.S. Dist. LEXIS 4407 (S.D. Ind. 2014).

Opinion

ORDER ON DEFENDANT’S MOTION TO DISQUALIFY COUNSEL

SARAH EVANS BARKER, District Judge.

This cause is before the Court on Defendant Hausmann-MeNally, S.C.’s Motion to Disqualify Counsel [Docket No. 29], filed on July 3, 2013. Defendant seeks disqualification of Plaintiffs counsel, Price, Waicukauski & Riley, LLC, on the grounds that the representation violates Indiana Professional Conduct Rule 1.7 as adopted by the Southern District of Indiana. In the alternative, Defendant seeks disqualification of attorneys William N. Riley and Joseph N. Williams as necessary witnesses pursuant to Indiana Professional Conduct Rule 3.7. For the reasons set forth below, the motion is DENIED.

Factual and Procedural Background1

This motion to disqualify arises out of a legal malpractice action, which in turn arises out of a personal injury claim. Plaintiff William Mills, the personal injury claimant, sued his former counsel, Defendant Hausmann-MeNally S.C. (“Hausmann-McNally”) for legal malpractice. Hausmann-MeNally, in turn, filed a motion to disqualify against Plaintiffs present counsel, Price, Waicukauski & Riley, LLC (“PWR”), alleging that PWR has a conflict of interest placing it in violation of the disciplinary rules of this court and the state of Indiana.

1. The Personal Injury Suit

Larry Mills was injured in a traffic accident on October 10, 2008 when his motorcycle was struck by another vehicle at an intersection on State Road 37 in rural Lawrence County, Indiana. Compl. ¶¶ 5-6.2 The driver of the other vehicle was Hannah Nelson, an employee of the Hoosier Uplands Development Corporation, who at the time of the accident was driving on an errand related to her employment with that agency. Id. at ¶¶ 7-8. After the accident, Ms. Nelson was interviewed by police for a crash report; she stated that she was the owner of the vehicle, and she provided her personal insurance information. Defs Br. 4. Shortly thereafter, Mr. Mills retained the law firm of Hausmann-[888]*888McNally to represent him in claims against “all liable parties” to seek recovery for his injuries; Indiana attorney Rodney A. Tucker held primary responsibility for the representation of Plaintiffs interests within Hausmann-McNally. Id. at ¶ 12; see also PWR’s Resp. 6. Larry Mills died in February 2012, and Plaintiff William Mills now serves as the representative of the decedent’s estate. Compl. ¶ 2.

Shortly after agreeing to represent Plaintiff, Hausmann-McNally contacted Farm Bureau, Ms. Nelson’s personal automobile insurer. On November 6, 2008, Farm Bureau sent Hausmann-McNally copies of Ms. Nelson’s insurance policy and declarations page. In the declarations page, Ms. Nelson stated that her vehicle “is driven to and from work 150 miles or less each week.” PWR’s Resp. 7. In preliminary negotiations with Hannah Nelson pursuant to the personal injury claim, Hausmann-McNally discovered that the limit of her personal automobile insurance policy was $50,000 — significantly less than the amount of damages Plaintiff planned to seek. Id. Hausmann-McNally did not make any further inquiries about Ms. Nelson’s employment status or the possibility of recovering from her employer. Instead, Hausmann-McNally made demand on Farm Bureau for the full $50,000, and Farm Bureau agreed to settle on May 13, 2009 for that amount. Farm Bureau provided Hausmann-McNally with a release, and ordered a $50,000 draft, to be paid to Plaintiff and counsel.3 Id. at 8 (citing Docket No. 38, Ex. A).

Because his damages exceeded the settlement amount, Mr. Mills expressed interest in the possibility of recovering from other entities, such as the manufacturer of his motorcycle helmet and the state agencies responsible for designing the intersection where the accident occurred. To facilitate this expansion of the scope of the case, Mr. Mills retained PWR on October 19, 2009. Compl. ¶¶ 17-18. The parties differ in their recounting of the scope of PWR’s representation. According to Hausmann-McNally, PWR took on the role of lead counsel for all of Mr. Mills’s potential claims. Def.’s Br. 4 (“PWR served as lead counsel in the litigation”). PWR, in contrast, asserts that it was retained only to pursue the new causes of action, and that it had no role in the original claim against Ms. Nelson. PWR’s Resp. 9-11.

The parties also differ in how they explain what happened next. It is undisputed that Hausmann-McNally, at least nominally, remained on as co-counsel after Plaintiff hired PWR. Plaintiff filed a products liability and negligence claim on April 21, 2010 in the Marion County Superior Court in Indianapolis, and that suit remains pending. Compl. ¶ 19. Both Hausmann-McNally and PWR filed appearances in that suit. Def.’s Br. 4-5. Plaintiff also filed a personal injury claim against Ms. Nelson at the same time. Compl. ¶ 19. What is disputed is why Plaintiff filed this personal injury suit. In PWR’s telling, PWR discovered — in the course of preparing for its products liability suit — that the March 2009 $50,000 settlement check from Ms. Nelson’s insurer was not actually in Hausmann-McNally’s possession; it also learned around the same time that photographs of the scene crucial to the products liability claim were in Farm Bureau’s possession. PWR’s Resp. 12-13. PWR explains that it named Ms. Nelson as a Defendant in order to enforce the earlier settlement agreement and to obtain an agreement from Farm Bureau to produce those photographs — in [889]*889other words, the inclusion of Ms. Nelson was largely incidental to their pursuit of the products liability claim. Id.

Hausmann-McNally remembers differently. According to its account, “there was significant confusion about the status of the Hannah Nelson claim well after PWR entered the case, and ample evidence to support the inference that the claim had not yet been settled .... ” Defi’s Reply at 5. In sum, Hausmann-McNally asserts that PWR, as the new lead counsel for Plaintiff, filed suit against Ms. Nelson not as an afterthought, but so that it could, for the first time, secure payment up to the policy limit from Ms. Nelson’s insurer. Id. at 4-6.

In either event, Ms. Nelson’s counsel quickly reached a settlement agreement with Plaintiff, but the products liability suit proceeded. In the course of discovery on that claim, PWR deposed Hannah Nelson as a witness on September 18, 2012. Compl. ¶ 20. During this deposition, Ms. Nelson revealed that she was acting within the course and scope of her employment with the Hoosier Uplands Development Corporation at the time of the accident. Id. Hoosier Uplands is a “Community Action Agency,” and is therefore considered a “political subdivision” of the State of Indiana for the purposes of the Indiana Tort Claims Act. Id. at ¶ 10 (citing Ind. Code §§ 12-14-23-2; 34-13-3-22(a)(1)). Under Indiana law, a prospective plaintiff intending to sue a political subdivision of the state for damages must provide written notice to the defendant agency outlining the nature of the claim and damages within 180 days of the injury. See Ind. Code § 34 — 13—3—8(a). If a prospective plaintiff fails to provide this notice, he is permanently barred from bringing the claim. Id. As of September 18, 2012, when Ms.

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Cite This Page — Counsel Stack

Bluebook (online)
992 F. Supp. 2d 885, 2014 WL 129280, 2014 U.S. Dist. LEXIS 4407, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mills-v-hausmann-mcnally-insd-2014.