Judge Virginia Keeny, Case 20VECV01388 2023-01-12 Tentative Ruling

Judge: Virginia Keeny, Case: 20VECV01388, Date: 2023-01-12 Tentative Ruling

Case Number: 20VECV01388 Hearing Date: January 12, 2023 Dept: W

MARK A. LIKER v. ELIEZER APPEL, et al.

PLAINTIFF’S MOTION TO DISQUALIFY ATTORNEY ELIEZER APPEL FROM REPRESENTING ANY PARTY IN THIS LITIGATION

Date of Hearing: January 12, 2023 Trial Date: None set.

Department: W Case No.: 20VECV01388

Moving Party: Plaintiff Mark A. Liker

Responding Party: Defendant Eliezer Appel

BACKGROUND

Plaintiff Mark A. Liker alleges Defendant Eliezer Appel, in his capacity as a California licensed attorney, instructed Plaintiff to purchase certain real property for $250,000.00 from Defendant Cochran Inc. and promised Plaintiff a return on his investment as well as plaintiff would take ownership of the property or that the property would secure Plaintiff’s investment. Plaintiff further alleges Eliezer Appel concealed from Plaintiff the fact that plaintiff did not own the property or the company that took title to the property that is, the Defendant Lockhart Development, Inc., and that Eliezer Appel took Plaintiff’s investment for his own gain.

On November 24, 2020, Plaintiff Mark A. Liker filed a complaint against Defendants Eliezer Appel, Lockhart Development, Inc., and Cochran Inc. asserting a single cause of action for fraud. Plaintiff filed a First Amended Complaint on October 20, 2022, asserting new causes of action – breach of contract, negligent misrepresentation, intentional misrepresentation, and breach of attorney fiduciary duty/duty of loyalty.

On February 11, 2021, Lockhart Development, Inc. filed a cross-complaint against Mark A. Liker asserting causes of action for (1) Breach of Written Contract; (2) Intentional or Negligent Interference with Contractual Relations; (3) Interference with Prospective Economic Advantage; (4) Breach of Fiduciary Duty; (5) Declaratory Relief; (6) Implied Contractual Indemnity; and (7) Slander of Title.

This action is related to Marc A. Larocque v. Christine Larocque Franz, et al. (LC105233).

[Tentative] Ruling

Plaintiff’s Motion to Disqualify attorney Eliezer Appel from representing any party in this litigation is GRANTED.

discussion

Plaintiff/Cross-Defendant Liker moves the court for an order disqualifying Defendant/Cross-Complainant attorney Eliezer Appel from representing any of the other parties named in this litigation. Plaintiff argues Appel is disqualified from representing Defendants Oscar Broederlow, Lockhart Development, Inc., Cochran Inc., and Roshmore Development Inc. based on a direct conflict of interest created by prior representation of Plaintiff in a substantially related matter, which is in direct violation of California Rules of Professional Conduct, Rules 1.7 and 1.9 and because Appel is a defendant himself in the instant matter, and will be called as a witness, which is in direct violation of California Rules of Professional Conduct, Rule 3.7.

“[W]here a former client seeks to have a previous attorney disqualified from serving as counsel to a successive client in litigation adverse to the interests of the first client, the governing test requires that the client demonstrate a ‘substantial relationship’ between the subjects of the antecedent and current representations.” (Flatt v. Superior Court (1994) 9 Cal.4th 275, 283 [emphasis in original].) Rules of Professional Conduct Rule 1.9 has encompassed the substantial relationship test and 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 unless the former client gives informed written consent.” (Cal. Rules of Prof. Conduct, rule 1.9(a).)

Plaintiff argues that because Appel represented Plaintiff in the very transactions that form the substance of the instant action, Appel is prohibited from representing the other defendants in this action. The court agrees. There is no doubt that the matters involve the same transaction or legal dispute. Appel makes several arguments in opposition to the motion to disqualify, most of which are incoherent and without merit. Appel contends he did not represent Plaintiff during the time that the alleged transaction giving rise to this litigation took place. However, this is the first time Appel has made this contention. Appel has never denied representing Plaintiff during the time the events arose which led to this instant litigation. Moreover, Plaintiff has submitted a declaration indicating that Appel was his attorney involved in the transactions that led to this lawsuit. In an e-mail to Plaintiff, Appel provides a summary of work done for Plaintiff and the results, which includes “Cass Avenue -pending. Meanwhile you have the title to the property-if for any reason your interest is compromised we will account for It and get you an offset against other projects or where money is due.” (Liker Decl., Exh. B.) Appel also contends there is a pending appeal in a separate action involving the Defendants and this representation is limited in scope. Even with the appeal pending in the other action, it is unclear why Defendants cannot obtain counsel.

California Rules of Professional Conduct, Rule 1.7(a) provides as that a lawyer shall not, without informed written consent from each client represent a client if the representation is directly adverse to another client in the same matter. CRPC Rule 1.7(b) provides that a lawyer shall not, without informed written consent from each affected client represent a client if there is a significant risk the lawyer’s representation will be materially limited by the lawyer’s responsibilities to or relationships with another client. Rules 1.7(a) and (b) are conditioned by Paragraph (d), which provides that representation is permitted where: (1) the lawyer reasonably believes he will be able to provide competent and diligent representation to each affected client; (2) representation is not prohibited by law; and (3) representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation.

Plaintiff argues in addition to violation of Rule 1.9 above, Appel also violates California Rule of Professional Conduct Rule 1.7 by representing co-defendants Lockhart, Cochran and Broederlow in this litigation as well as defending himself and his own interests. Appel does not discuss whether he has obtained written consent although it is clear that there is a significant risk the lawyer’s representation of the client will be materially limited by the lawyer’s responsibilities to or relationships with another client or by the lawyer’s own interests. Appel is named as a defendant in the instant action and there is a significant risk his interest in defending himself may materially limit his representation of the corporations and if not, at the very least Broederlow.

Lastly, California Rules of Professional Conduct, Rule 3.7 provides: “A lawyer shall not act as an advocate in a trial in which the lawyer is likely to be a witness unless: (1) the lawyer's testimony relates to an uncontested issue or matter; (2) the lawyer's testimony relates to the nature and value of legal services rendered in the case; or (3) the lawyer has obtained informed written consent from the client. If the lawyer represents the People or a governmental entity, the consent shall be obtained from the head of the office or a designee of the head of the office by which the lawyer is employed.” As Appel has not demonstrated he has obtained informed written consent from the other named Defendants, none of the exceptions to Rule 3.7 apply and Appel is in violation of California Rules of Professional Conduct, Rule 3.7. As a defendant in the instant action, it is very likely Appell will be called as a witness.

Accordingly, Plaintiff’s Motion to Disqualify attorney Eliezer Appel from representing any party in this litigation is GRANTED. The defendants have sixty days to secure new counsel.