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Attorney’s Conflict of Interest

Posted on : February 13, 2017, By:  Christopher Hildebrand
Attorneys Conflict of Interest

Attorney’s Conflict of Interest

Attorneys in Arizona cannot accept representation against prior clients where they might devolve confidential information. If they do, they are subject to disqualification and sanctions. In Lalliss v. Hagerty et al., No. 1 CA-CV 15-0545 FC, the Arizona Court of Appeals discussed this issue. This decision was unpublished, which means it cannot be cited as authority in a case.

Facts of the Case

In 2010, Mrs. Hagerty and Mr. Hagerty divorced. After the divorce, the former spouses filed numerous post-decree petitions. Mrs. Hagerty hired attorney Mr. Lalliss to represent her in these motions. At an evidentiary hearing in September 2014, Mr. Hagerty’s attorney moved to disqualify Mr. Lalliss as counsel for Mrs. Hagerty. He claimed Mr. Lalliss had a conflict of interest.
Attorneys Conflict of Interest
Mr. Lalliss had represented Justin in various matters in the past. The court granted the motion. It disqualified Mr. Lalliss and required him to pay Mr. Hagerty’s fees and costs of bringing the motion. Mr. Lalliss asked the court to set aside the disqualification and fee award. The court denied this, ordering Mr. Lallis to pay $2,362.25 in fees and costs to Mr. Hagerty’s counsel.

Arizona’s Conflict of Interest Rules

On appeal, Mr. Lalliss argues his prior representation of Mr. Hagerty did not create a conflict of interest. He claims that his prior representation of Mr. Hagerty in the three matters did not relate to “the same or a substantially related matter” under Arizona Rules. The Arizona Ethical Rules provide:

“A lawyer who has formally 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 interest of the former client unless the former client gives informed consent, confirmed in writing.”

A court has authority to disqualify an attorney who represents conflicting interests. The comments to the rule explain that matters are “substantially related” under the rule “if they involve the same transaction or legal dispute or if there otherwise is a substantial risk that confidential factual information as would normally have been obtained in the prior representation would materially advance the client’s position in the subsequent matter.”

Confidential information is defined as “information relating to the representation of a client.” This principal is grounded on the confidential relationship between an attorney and a client. This rule is intended to protect any shared information from disclosure and wrongful use. The comments give the following example:

“[A] lawyer who has represented a businessperson and learned extensive private financial information about that person may not then represent that person’s spouse in seeking a divorce.”

Hildeband Law, PC.

Mr. Lalliss’s Conflict of Interest

In this case, Mrs. Hagerty and Mr. Hagerty were arguing about parenting time, child support, medical reimbursement and attorney fees. Mrs. Hagerty claimed that the children suffered emotionally after they spent time with Mr. Hagerty. She also claimed that he was behind in child support, and Mr. Hagerty had lost many civic cases.
Attorneys Conflict of Interest
Mr. Lalliss represented Justin in three prior cases. He could have obtained information relevant to one of the couple’s current disputes. Where it is possible that an attorney obtained confidential information relevant to a subsequent case, the attorney must be disqualified.

The Court found that the family court did not abuse its discretion in disqualifying Mr. Lalliss from representing Mrs. Hagerty in the post-decree proceedings. Likewise, the Court found the award of fees and costs appropriate.

Disposition

The Court of Appeals affirmed the family court’s orders. It remanded the case for further proceedings consistent with this decision.


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