In Re the Marriage of Perry , 368 Mont. 211 ( 2013 )

January 15 2013
DA 11-0704
IN THE SUPREME COURT OF THE STATE OF MONTANA
2013 MT 6IN RE THE MARRIAGE OF:
TERANCE PATRICK PERRY,
Petitioner and Appellee,
and
KAREN JANE PERRY,
Respondent and Appellant.
APPEAL FROM: District Court of the Fourth Judicial District,
In and For the County of Missoula, Cause No. DR 09-841
Honorable Robert L. Deschamps, III, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Linda Osorio St. Peter; St. Peter Law Offices, P.C.; Missoula, Montana
For Appellee:
Gail H. Goheen; Gail H. Goheen, P.C.; Hamilton, Montana
Submitted on Briefs: September 12, 2012
Decided: January 15, 2013
Filed:
__________________________________________
Clerk
Justice Jim Rice delivered the Opinion of the Court.
¶1 Appellant Karen Jane Perry (Karen) appeals the Fourth Judicial District Court’s
order denying her request to disqualify and enjoin attorney Gail H. Goheen (Goheen)
from representing Appellee Terance Patrick Perry (Terance) in this proceeding. We
affirm and address the following issues:
¶2 1. Did the District Court err by denying Karen’s motion to disqualify Goheen as
counsel for Terance pursuant to Rule 1.20 of the Montana Rules of Professional
Conduct?
¶3 2. Did Goheen violate her duty to Karen under Rule 1.9 of the Montana Rules of
Professional Conduct?
¶4 3. Did the District Court err by permitting Goheen to testify at the
disqualification hearing?
¶5 4. Did the District Court err by relying on privileged communications between
Goheen and Karen?
¶6 5. Was Karen denied due process when the District Court relied on documents
and sworn testimony not subject to cross examination?
¶7 6. Did the District Court err by determining that Karen abused the rules of
disqualification?
FACTUAL AND PROCEDURAL BACKGROUND
¶8 On December 4, 2009, Terance filed for dissolution of his marriage to Karen in
Missoula County. Karen subsequently filed a dissolution proceeding in Massachusetts,
which was dismissed for lack of subject matter jurisdiction. Terance is a partner of the
law firm of Datsopoulos, MacDonald & Lind, P.C. in Missoula. Terance was represented
by three different attorneys before filing a notice of withdrawal and substitution of
counsel on January 24, 2011, naming himself as counsel of record. On February 25,
2
2011, Terance filed a subsequent substitution of counsel naming Goheen as his counsel of
record.
¶9 In January 2008, before any dissolution proceedings were filed, Karen contacted
Goheen’s office in Hamilton seeking legal advice concerning the potential filing of a
dissolution action. Karen spoke with Goheen’s assistant, Kailah Van Note (Van Note),
and later Goheen herself.
¶10 Karen filed a motion to disqualify Goheen and an application for a preliminary
injunction on March 1, 2011. Terance opposed the motion and filed two office
memorandums and affidavits from Goheen and Van Note regarding their telephone
conversations with Karen. A disqualification hearing was held on November 7, 2011.
Two days before the hearing, Karen filed a motion to strike the office memorandums and
affidavits as privileged, asserting that the documents “included information which is
harmful to [Karen].” The District Court took the motion under advisement, granted the
parties’ motion to seal the documents from public access, limited Goheen’s testimony
about the documents, and did not permit Karen to cross-examine Goheen about the
documents.
¶11 At the hearing, Karen testified that she provided personal information about
herself and Terance during one telephone conversation with Van Note and two telephone
conversations with Goheen. Karen said the conversations with Goheen lasted 45 minutes
and 3 minutes, respectively. She said that she gave information about the marriage,
3
including domestic abuse 1 and finances, and that she asked for legal advice on her
“position,” which she described as: “[w]here I wanted to end up. If I could end up at a
certain place. What would happen if I stayed here. What happen if I left here. Goals of
settlement. My weaknesses and fears.” Karen testified that she identified individuals
who were present during domestic disputes. She said Goheen quoted her a “ridiculously
enormous” retainer, but conceded that she was never sent a retainer agreement and that
Goheen had “denied representation.” Karen admitted awareness of some sort of conflict
between Goheen and Datsopoulos, MacDonald & Lind. Karen testified that she thought
the information she gave to Goheen’s office would be confidential. When asked by her
counsel why she believed she had an attorney-client confidential relationship with
Goheen in 2008, Karen said “[b]ecause it was promised to me.”
¶12 When asked “[h]ow does Gail Goheen’s representation of your husband now, in
this dissolution of marriage that he brought three years later, harm you,” Karen
responded:
[P]sychologically, it’s like getting beat up again by him. It’s like I can’t
trust anybody. There’s nobody I can turn to. He took away everything and
everybody I could trust. And now he’s done it again with somebody who I
confided in, who’s now on the opposite side of the table. And it – I – I’m
betrayed again. It’s another form of abuse and control . . .
When asked “[i]s there anything in the communications [from Goheen], even within the
brief of the attachments, that you feel have already harmed you,” Karen responded,
“Yeah . . . I’ve been called a liar. I’ve been discredited already.”
1
Terance denies the abuse allegations, the validity of which are beyond the scope of this appeal.
4
¶13 Overruling Karen’s objections that Goheen “can’t testify to attorney-client
communications and that she cannot be an advocate and material witness,” the District
Court permitted Goheen to offer testimony about the length of the telephone
conversations, her office procedures, and background information established in the court
file. Goheen testified without another attorney questioning her. Goheen admitted to
having one conversation with Karen in January 2008, which she said lasted less than 12
minutes because the time entry information on the record was left blank and it is her
office policy that time information is left blank when a conversation lasts 12 minutes or
less. Goheen denied having a second conversation with Karen. Explaining her office
procedures for new clients, Goheen stated:
Whenever I meet with a client, Your Honor, I don’t do it over the
phone, in the sense of getting information. I sit down and I meet with the
client for a half a day, usually, is my first meeting with a client on a divorce
action.
It’s at that time that I go over everything I can think of, in terms of –
at least broadly, in terms of the scope of the case, what the assets may be,
the liabilities may be, whether there are children, what the nature of the
relationship is with the party. All details.
I’m not interested in it, information, in terms of any details prior to
that time. And my policy is that I never give anybody a retainer quote until
I get all that information.
...
So I can state unequivocably [sic] that I would not have given a
retainer quote to Karen Perry, or any other client under these circumstances.
Goheen said she was aware that Karen’s husband was an attorney at Datsopoulos,
MacDonald & Lind and that she does not represent someone against an attorney in
Ravalli or Missoula County when the opposing attorney is from a firm that she regularly
faces in divorce cases. Goheen said she did not remember the details of a conversation
5
with Karen, relying on the office memorandums created from her and Van Note’s
conversations with Karen. Goheen said that a 45 minute telephone conversation did not
occur, and that her telephone records indicate she made a two or three minute telephone
call to refuse the case and refer Karen to someone else. Goheen said she was notified by
Karen’s current attorney that Karen had contacted Goheen’s office in September 2009
and in January 2010 but that her telephone records revealed only two telephone
conversations with Karen in January 2008. Van Note also testified about Goheen’s office
procedures.
¶14 Throughout the hearing, Goheen referred to, and Karen repeatedly objected to, the
office notes, memorandums, and the related affidavits, which were the subject of Karen’s
motion to strike. After the hearing, the District Court issued an order stating:
Before issuing its ruling, the Court requests that Ms. Goheen submit a
sealed copy of the “Note” from her office discussed at the hearing, along
with any other relevant materials generated by Ms. Goheen or her staff
pertaining to [Karen’s] communications with Ms. Goheen and/or her office,
for in camera review.
After receiving this information, the District Court denied Karen’s motion to disqualify
and application for a preliminary injunction. The court kept the documents sealed from
public access. It found that no attorney-client relationship existed between Karen and
Goheen, commenting that it was “hard to believe that, as a seasoned paralegal, Karen
‘reasonably believed’ she had an attorney-client relationship with Ms. Goheen.” The
District Court reasoned that Karen’s motion to disqualify was “a tactic designed to delay
resolution of this case and force hardship and increased litigation expenses upon
6
Terance,” and “disqualification of Ms. Goheen would be unjust and unreasonably harsh
in this case.” Karen appeals.
STANDARD OF REVIEW
¶15 “A district court’s denial of a motion to disqualify is reviewed for an abuse of
discretion.” Krutzfeldt Ranch, LLC v. Pinnacle Bank, 2012 MT 15, ¶ 13, 363 Mont. 366,
272 P.3d 635 (citing Schuff v. A.T. Klemens & Son, 2000 MT 357, ¶ 26, 303 Mont. 274,
16 P.3d 1002). An abuse of discretion occurs if the district court acted “arbitrarily
without the employment of conscientious judgment or exceed[ed] the bounds of reason,
in view of all the circumstances, ignoring recognized principles resulting in substantial
injustice.” Schuff, ¶ 27. “The existence of an attorney-client relationship is generally a
question of fact.” Krutzfeldt, ¶ 14 (citations omitted). “We review a district court’s
factual determinations for clear error.” Krutzfeldt, ¶ 14 (citation omitted). District
courts have broad discretion to determine the admissibility of evidence, including oral
testimony, and we review for abuse of discretion. Clark v. Bell, 2009 MT 390, ¶ 16, 353
Mont. 331, 220 P.3d 650; State v. Snell, 2004 MT 334, ¶ 17, 324 Mont. 173, 103 P.3d
503.
¶16 “While the denial of a temporary or permanent injunction is reviewed for
‘manifest abuse of discretion,’ deference is not applied to the district court’s conclusions
of law, which are reviewed de novo to determine whether its interpretation of the law is
correct.” Krutzfeldt, ¶ 13 (citing City of Whitefish v. Bd. of Co. Commrs. of Flathead Co.,
2008 MT 436, ¶ 7, 347 Mont. 490, 199 P.3d 201; Jefferson Co. v. Dept. of Envtl. Quality,
7
2011 MT 265, ¶ 16, 362 Mont. 311, 264 P.3d 715). “Ultimately, it is this Court’s
‘constitutional mandate to fashion and interpret the Rules of Professional Conduct.’”
Krutzfeldt, ¶ 15 (quoting In re Rules of Prof. Conduct, 2000 MT 110, ¶ 9, 299 Mont. 321,
2 P.3d 806).
DISCUSSION
¶17 1. Did the District Court err by denying Karen’s motion to disqualify Goheen as
counsel for Terance pursuant to Rule 1.20 of the Montana Rules of Professional
Conduct?
¶18 Karen claims that the District Court erred by not disqualifying Goheen because an
implied attorney-client relationship was formed between Karen and Goheen when Karen
gave Goheen information that was “confidential” in nature, citing Krutzfeldt and
Pro-Hand Services Trust v. Monthei, 2002 MT 134, 310 Mont. 165, 49 P.3d 56. Terance
argues that the District Court correctly found that there was “nothing disclosed by Karen
to Ms. Goheen or her staff ‘that could be significantly harmful’ to Karen in this matter”
to warrant disqualification under Rule 1.20 of the Montana Rules of Professional
Conduct. Karen replies that she is “psychologically harmed” by the fact that Terance has
hired Goheen and “[t]he district court did not properly address the correct standard or
pertinent issue relative to Rule 1.20(c) with respect to the harm to Karen in determining
Goheen’s conflict of interest.” (Emphasis in original.)
8
¶19 We have not yet addressed a lawyer’s duty to prospective clients under the
Montana Rules of Professional Conduct as amended in 2004.2 We considered this
relationship under prior rules in Pro-Hand Services, stating:
An implied attorney-client relationship may result when a prospective
client divulges confidential information during a consultation with an
attorney for the purpose of retaining the attorney, even if actual
employment does not result. . . . In determining whether an implied
attorney-client relationship exists, we will examine whether the alleged
client reasonably believed that such relationship was formed.
Pro-Hand Services, ¶ 14 (internal citations omitted). Our ruling in Pro-Hand Services
was based upon former Rule 1.9, entitled “Conflict of Interest, Former Client,” requiring
an analysis of whether confidential information had been exchanged. We adopted the
Ninth Circuit’s “reasonable probability” rule to determine whether confidences were
disclosed. Pro-Hand Services, ¶ 15 (citing Trone v. Smith, 621 F.2d 994, 998 (9th Cir.
1980)). If confidential information was not disclosed, then an attorney-client relationship
did not exist. Pro-Hand Services, ¶ 14. “If an attorney-client relationship was not
formed, there is no conflict of interest,” Pro-Hand Services, ¶ 13, and an attorney could
then represent a client in a matter that was adverse to the former prospective client.
¶20 In 2004, Rule 1.20, entitled “Duties to Prospective Clients” was adopted. Rule
1.20 defines and addresses a lawyer’s relationship with a prospective client. It provides
in its entirety:
2
See Or., In Re: Revising the Montana Rules of Professional Conduct (Mont. Feb. 17, 2004)
(No. 03-264).
9
(a) A person who consults with or has had consultations with a
lawyer about the possibility of forming a client-lawyer relationship with
respect to a matter is a prospective client.
(b) Even when no client-lawyer relationship ensues, a lawyer who
has had consultations with a prospective client shall not use or reveal
information learned in the consultation(s), except as Rule 1.9 would permit
with respect to information of a former client.
(c) A lawyer subject to paragraph (b) shall not represent a client
with interests materially adverse to those of a prospective client in the same
or a substantially related matter if the lawyer received information from the
prospective client that could be significantly harmful to that person in the
matter, except as provided in paragraph (d). If a lawyer is disqualified from
representation under this paragraph, no lawyer in a firm with which that
lawyer is associated may knowingly undertake or continue representation in
such a matter, except as provided in paragraph (d).
(d) Representation is permissible if both the affected client and the
prospective client have given informed consent, confirmed in writing, or:
(1) the disqualified lawyer is timely screened from any participation in the
matter and is apportioned no part of the fee therefrom; and (2) written
notice is promptly given to the prospective client.
M. R. Pro. C. 1.20.
¶21 Instead of determining whether an attorney-client relationship was created by
disclosure of confidential information, Rule 1.20 creates duties to the prospective client
“[e]ven when no client-lawyer relationship ensues.” M. R. Pro. C. 1.20(b). Generally,
and subject to exceptions discussed herein, a lawyer may not “use or reveal information
learned in the consultation(s)” with a prospective client. M. R. Pro. C. 1.20(b). Pertinent
to the present issue, Rule 1.20 also prohibits a lawyer from representing a party with
“interests materially adverse” to the prospective client in the same or substantially related
proceeding “if the lawyer received information from the prospective client that could be
significantly harmful to that person in the matter.” M. R. Pro. C. 1.20(c). Thus, Rule
1.20 does not merely consider whether information was divulged by the prospective
10
client but whether such information could be significantly harmful to that person in that
or a related matter. Rule 1.18 of the American Bar Association’s Model Rules of
Professional Conduct (Model Rules) is nearly identical to Montana Rule 1.20. The
Committee Comments to Model Rule 1.18 state “the lawyer is not prohibited from
representing a client with interests adverse to those of the prospective client in the same
or a substantially related matter unless the lawyer has received from the prospective
client information that could be significantly harmful if used in the matter.” Model R.
Prof. Conduct 1.18 cmt. 6 (ABA 2012).
¶22 Our recent holding in Krutzfeldt dealt with the distinction between current and
former clients. Hoskins, an attorney representing the Krutzfeldts, joined the Crowley
Fleck firm, which represented a party opposing the Krutzfeldts. Crowley argued that the
Krutzfeldts necessarily became Hoskins’ former clients, and were no longer current
clients, when Hoskins joined Crowley. Krutzfeldt, ¶ 20. We rejected this argument and
concluded that Hoskins did not withdraw from representing the Krutzfeldts, that
Krutzfeldts were current clients when Hoskins joined Crowley, and a concurrent conflict
of interest existed among Hoskins, Krutzfeldts, and Crowley. Krutzfeldt, ¶ 26.
¶23 The rule enforced in Krutzfeldt applied to current clients, where the proponent of
the motion to disqualify “must offer sufficient proof that the continued representation of
one party by the attorney or firm will prejudice or adversely impact the rights of another
party in the matter pending before the court.” Krutzfeldt, ¶ 17 (quoting Schuff, ¶ 36).
Rule 1.20 applies to prospective clients and prohibits representation of a party with
11
materially adverse interests in the same or substantially related proceeding if the
prospective client divulged information to the lawyer that could be significantly harmful
to the prospective client in the matter.
¶24 Karen is a “prospective client” as defined by Rule 1.20(a) (“A person who
consults with or has had consultations with a lawyer about the possibility of forming a
client-lawyer relationship with respect to a matter is a prospective client.”). Karen called
Goheen’s office more than once and spoke with Van Note and Goheen concerning
representation. The question here does not depend on whether an attorney-client
relationship was established or whether Karen reasonably believed such a relationship
was formed, as in Pro-Hand Services, ¶¶ 13-15. Rather, under Rule 1.20, the question is
whether the information conveyed in Karen’s conversations could be significantly
harmful to Karen in this dissolution proceeding.3
¶25 After hearing the testimony, the District Court found that the information
conveyed by Karen to Goheen was not harmful to Karen. The court found that Goheen’s
office documentation of Karen’s phone calls and the testimony of Goheen and Van Note
were credible and that “there was nothing disclosed by Karen to Ms. Goheen or her staff
‘that could be significantly harmful’ to Karen in this matter.” Karen claims a personal or
psychological victimization by Goheen’s representation of Terance. While we do not
3
Even if Pro-Hand Services governed here, Karen did not persuade the District Court that an
implied attorney-client relationship had been established by her reasonable belief a relationship
had been formed. Pro-Hand Services, ¶ 14. Karen acknowledged that Goheen declined
representation of her due to a conflict of some nature between Goheen’s firm and Datsopoulos,
MacDonald & Lind. Because it is necessary for resolution of the issues raised herein, we affirm
the District Court’s conclusion that an implied relationship was not formed.
12
minimize the significance of such an effect, Rule 1.20 requires that the lawyer receive
“information” that is “significantly harmful” to Karen in the proceeding. M. R. Pro. C.
1.20(c). Karen did not establish that any information she divulged to Goheen in the
telephone calls several years earlier could have any impact on the proceeding,
particularly since, as discussed below, Goheen was not associated as counsel until three
years into the proceeding, by which time substantially more information had been
disclosed than the information Karen claims to have shared during those phone calls. We
therefore conclude that the District Court did not abuse its discretion in denying Karen’s
motion to disqualify under Rule 1.20.
¶26 2. Did Goheen violate her duty to Karen under Rule 1.9 of the Montana Rules of
Professional Conduct?
¶27 Karen claims that Goheen violated Rule 1.9 of the Montana Rules of Professional
Conduct, which Karen labels the “duty of loyalty,” by representing Terance. Karen’s
argument under Rule 1.9, entitled “Duties to Former Clients,” is premised upon her
assumption that an implied attorney-client relationship was established between her and
Goheen, making Karen a “former client.” However, as noted above, Karen failed to
establish an attorney-client relationship, and thus the portion of her argument premised
thereon fails. Karen also argues that Goheen violated Rule 1.9 by using or disclosing
information Karen had divulged to her. Because the provisions of Rule 1.9 regarding use
of former client information are incorporated by Rule 1.20, governing the duties to
prospective clients, we take up Karen’s argument in that regard.
13
¶28 Rule 1.20(b) provides that “a lawyer who has had consultations with a prospective
client shall not use or reveal information learned in the consultation(s), except as Rule 1.9
would permit with respect to information of a former client.” M. R. Pro. C. 1.20(b). In
turn, Rule 1.9 states, in pertinent part:
(c) A lawyer who has formerly represented a client in a matter or
whose present or former firm has formerly represented a client in a matter
shall not thereafter: (1) use information relating to the representation to the
disadvantage of the former client except as these Rules would permit or
require with respect to a client, or when the information has become
generally known; or (2) reveal information relating to the representation
except as these Rules would permit or require with respect to a client.
M. R. Pro. C. 1.9(c).
¶29 Additionally, Rule 1.6, “Confidentiality of Information,” generally governs a
lawyer’s use of client information, and provides:
(a) A lawyer shall not reveal information relating to the
representation of a client unless the client gives informed consent, the
disclosure is impliedly authorized in order to carry out the representation or
the disclosure is permitted by paragraph (b).
(b) A lawyer may reveal information relating to the representation
of a client to the extent the lawyer reasonably believes necessary: (1) to
prevent reasonably certain death or substantial bodily harm; (2) to secure
legal advice about the lawyer’s compliance with these Rules; (3) to
establish a claim or defense on behalf of the lawyer in a controversy
between the lawyer and the client, to establish a defense to a criminal
charge or civil claim against the lawyer based upon conduct in which the
client was involved or to respond to allegations in any proceeding
concerning the lawyer’s representation of the client; or (4) to comply with
other law or a court order.
M. R. Pro. C. 1.6.
¶30 As established under Issue 1, Karen has not demonstrated that Goheen received
information that could be significantly harmful to her in this proceeding. At the
14
disqualification hearing, the District Court first limited Goheen’s testimony to
information that was “generally known.” M. R. Pro. C. 1.9(c)(1). The parties had
previously filed information detailing Karen’s and Terance’s personal information, the
parties’ financial situations, and Karen’s affidavits alleging spousal abuse. In its order,
the District Court found that “any information regarding Terance’s alleged abuse of
Karen is now moot given what Karen herself subsequently disclosed early on in this
case.” The District Court permitted Goheen to testify concerning the background
information in the court file, then permitted Goheen to testify as to the length of the
telephone conversations with Karen, and Goheen’s office procedures. It was permissible
under the Rules for Goheen to use this information about her previous contact with Karen
“to respond to allegations in any proceeding concerning the lawyer’s representation of the
client.” M. R. Pro. C. 1.6(b)(3). The District Court properly limited Goheen’s testimony
to prevent disclosure of Karen’s confidences, if any. See Pro-Hand Services, ¶ 16.
¶31 Karen’s allegations against Goheen are generalized and vague. Goheen’s limited
use of Karen’s information was permitted under Rules 1.6(b) and 1.9(c), and Goheen did
not violate a duty to Karen.
¶32 3. Did the District Court err by permitting Goheen to testify at the
disqualification hearing?
¶33 In a related issue, Karen challenges the District Court’s ruling that permitted
Goheen to testify in any manner at the hearing. Karen claims this was error because
Goheen did not qualify as a “necessary witness” under Rule 3.7 of the Montana Rules of
Professional Conduct. Terance responds that Goheen’s testimony falls under the
15
exceptions within Rule 3.7 because it was related to the nature of the legal services
provided to Karen, M. R. Pro. C. 3.7(a)(2), and because disqualification would render a
substantial hardship to Terance, M. R. Pro. C. 3.7(a)(3).
¶34 Rule 3.7, entitled “Lawyer as Witness,” provides, in pertinent part:
(a) A lawyer shall not act as advocate at a trial in which the lawyer
is likely to be a necessary witness unless: (1) the testimony relates to an
uncontested issue; (2) the testimony relates to the nature and value of legal
services rendered in the case; or (3) disqualification of the lawyer would
work substantial hardship on the client.
M. R. Pro. C. 3.7(a). Other jurisdictions have defined the term “necessary witness” in
this context as a witness whose testimony is both admissible and unavailable by other
means. See i.e. Brown v. Spectrum Networks, Inc., 904 N.E.2d 576, 580-81 (Ohio 2008);
Sec. Gen. Life Ins. Co. v. Super. Ct., 718 P.2d 985, 988 (Ariz. 1986).4 If the advocate-
witness lawyer knows she will be a necessary witness, it is her burden to establish an
exception to Rule 3.7. See Klupt v. Krongard, 728 A.2d 727, 741 (Md. 1999) (citations
omitted). Committee Comments to Model Rule 3.7, which is identical to Montana Rule
3.7, explain:
Paragraph (a)(2) recognizes that where the testimony concerns the extent
and value of legal services rendered in the action in which the testimony is
4
A third prong is commonly required in cases where party A calls opposing party B’s attorney in
an attempt to disqualify opposing party B’s attorney. “[W]hen an attorney is sought to be
disqualified from representing his client because an opposing party desires to call the attorney as
a witness, the motion for disqualification should not be granted unless the following factors can
be met: First, it must be shown that the attorney will give evidence material to the determination
of the issues being litigated; second, the evidence cannot be obtained elsewhere; and, third, the
testimony is prejudicial or may be potentially prejudicial to the testifying attorney’s client.”
Smithson v. U.S. Fid. & Guar. Co., 411 S.E.2d 850, 856 (W. Va. 1991). See also Klupt v.
Krongard, 728 A.2d 727, 740 (Md. 1999); LeaseAmerica Corp. v. Stewart, 876 P.2d 184, 192
(Kan. App. 1994).
16
offered, permitting the lawyers to testify avoids the need for a second trial
with new counsel to resolve that issue. Moreover, in such a situation the
judge has firsthand knowledge of the matter in issue; hence, there is less
dependence on the adversary process to test the credibility of the testimony.
Model R. Prof. Conduct 3.7 cmt. 3. The Model Rule Comments add: “paragraph (a)(3)
recognizes that a balancing is required between the interests of the client and those of the
tribunal and the opposing party.” Model R. Prof. Conduct 3.7 cmt. 4.
¶35 Goheen sought leave to testify concerning the nature of the legal services provided
by her office and in support of her position that disqualification would work a substantial
hardship for Terance. Although the District Court did not expressly find that Goheen was
a necessary witness, it impliedly did so by allowing Goheen to testify but carefully
limited the scope of her testimony to subjects discussed above. We conclude that
Goheen’s testimony was properly taken pursuant to Rule 3.7(a)(2), permitting a lawyer’s
testimony relating to the nature of legal services rendered. We thus decline to address
Terance’s argument that Goheen’s disqualification would work a hardship to Terance
under Rule 3.7(a)(3). We affirm the District Court’s actions.5
¶36 4. Did the District Court err by relying on privileged communications between
Goheen and Karen?
¶37 Karen argues that Goheen’s office memorandum, Goheen’s and Van Note’s
handwritten notes, and the “Note” that the District Court required Goheen to produce
after the hearing, were confidential communications and the District Court’s reliance
5
The District Court did note its surprise that Goheen intended to testify without the assistance of
counsel and said “I think that’s a problem.” However, the District Court permitted the testimony
and did not comment further on the issue in its order. The issue is not fully analyzed in the
briefing, and we decline to address it further.
17
upon them violated the attorney-client privilege, which she did not waive. Karen moved
to strike this evidence shortly before the hearing. Terance responds that there was no
attorney-client relationship, and, even if so, Karen waived the privilege by filing the
motion to disqualify Goheen.
¶38 The attorney-client privilege is one of the professional relationship privileges
recognized by the statutory provisions governing evidence:
(1) An attorney cannot, without the consent of the client, be
examined as to any communication made by the client to the attorney or the
advice given to the client in the course of professional employment.
(2) A client cannot, except voluntarily, be examined as to any
communication made by the client to the client’s attorney or the advice
given to the client by the attorney in the course of the attorney’s
professional employment.
Section 26-1-803, MCA (2011). Regarding statutory privileges, Rule 503 of the Montana
Rules of Evidence provides that “[a] person upon whom these rules confer a privilege
against disclosure waives the privilege if the person . . . voluntarily discloses or consents
to disclosure of any significant part of the privileged matter. This rule does not apply if
the disclosure itself is privileged.” M. R. Evid. 503(a). The attorney-client privilege may
be impliedly waived “if a party injects into . . . litigation an issue that requires testimony
from its attorneys or testimony concerning the reasonableness of its attorneys’ conduct”
or “where a party makes assertions in the litigation or asserts a claim that in fairness
requires the examination of the protected communications.” Dion v. Nationwide Mut.
Ins. Co., 185 F.R.D. 288, 294 (D. Mont. 1998) (internal quotations and citations omitted).
“An implied waiver of the attorney[-]client privilege occurs when (1) the party asserts the
18
privilege as a result of some affirmative act, such as filing suit; (2) through this
affirmative act, the asserting party puts the privileged information at issue; and
(3) allowing the privilege would deny the opposing party access to information vital to its
defense.” Dion, 185 F.R.D. at 295.
¶39 Dion involved more typical personal injury and “bad faith” litigation where the
insurer sought to exclude communications between it and the attorney expert witness.
Dion, 185 F.R.D. at 291, 295-96. The court found that the insurer had waived the
privilege by its litigation actions. Dion, 185 F.R.D. at 295-96. Similarly, Karen’s actions
necessarily waived the evidentiary privilege. Karen, a former prospective client of
Goheen, filed a motion to disqualify Goheen on the basis of the consultations between
her and Goheen’s office. As Dion noted, “in fairness,” Goheen’s defense against Karen’s
claim required examination of the protected communications. Dion, 185 F.R.D. at 294.
“The doctrine of waiver by implication reflects the notion that the attorney-client
privilege ‘was intended as a shield, not a sword.’” Dion, 185 F.R.D. at 295 (citations
omitted). Thus, even if Karen had established that an implied attorney-client relationship
existed, Karen’s claims that privileged information was being misused and that Goheen
should be disqualified put these communications at issue and waived any attorney-client
privilege. Allowing Karen’s invocation of the privilege to deny Goheen’s use of her
office’s notes would eliminate “access to information vital” to Goheen’s defense to the
motion and prevent the court from properly analyzing the claim. Dion, 185 F.R.D. at
295.
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¶40 5. Was Karen denied due process when the District Court relied on documents
and sworn testimony not subject to cross examination?
¶41 Karen contends that her right to due process was denied when the court took under
advisement her motion to strike the documents from Goheen’s office and did not permit
Karen to cross-examine Goheen about the documents. The motion had been filed shortly
before the hearing. Terance notes that the District Court also limited the scope of
Goheen’s and Van Note’s testimony pending its decision on the motion to strike.
¶42 However, Karen’s brief offers no supporting law or analysis for her state
constitutional law claim. Rule 12 of the Montana Rules of Appellate Procedure requires
that an argument section of a brief “contain the contentions of the appellant with respect
to the issues presented, and the reasons therefor, with citations to the authorities, statutes,
and pages of the record relied on.” M. R. App. P. 12(1)(f). This Court has stated it will
not consider unsupported issues or arguments and “is under no obligation to locate
authorities or formulate arguments for a party in support of positions taken on appeal.”
In re Marriage of Damschen, 2011 MT 297, ¶ 41, 363 Mont. 19, 265 P.3d 1245 (citing
Leichtfuss v. Dabney, 2005 MT 271, ¶ 37 n. 8, 329 Mont. 129, 122 P.3d 1220; In re
Marriage of McMahon, 2002 MT 198, ¶ 6, 311 Mont. 175, 53 P.3d 1266). We thus
decline to consider this issue further.
¶43 6. Did the District Court err by determining that Karen abused the rules of
disqualification?
¶44 Karen challenges the District Court’s comments that “[d]isqualification rules can
be abused by clients. Such is the case at hand,” and “the Court is concerned that Karen’s
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motion to disqualify is, in reality, a tactic designed to delay resolution of this case and
force hardship and increased litigation expenses upon Terance.” Karen argues that
Terance has delayed and raised the cost of this proceeding by choosing Goheen to
represent him, and that there is no evidence that Karen manipulated or abused the
disqualification rules.
¶45 We have reviewed Karen’s claims under the Montana Rules of Professional
Conduct at face value and decided them without regard to her personal motives in the
litigation. Despite the District Court’s comments, we believe it nonetheless likewise
properly applied the Rules and reached the correct conclusions. Thus, the comments
made regarding Karen’s motives had no impact on the outcome of this proceeding.
¶46 Affirmed.
/S/ Jim Rice
We concur:
/S/ Mike McGrath
/S/ Patricia O. Cotter
/S/ Beth Baker
/S/ Brian Morris
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