Imperial Credit v. Eighth Jud. Dist. Ct. , 2014 NV 59 ( 2014 )

130 Nev., Advance Opinion 59
IN THE SUPREME COURT OF THE STATE OF NEVADA
IMPERIAL CREDIT CORPORATION No. 65737
DBA A.I. CREDIT CORPORATION, A
NEW HAMPSHIRE CORPORATION;
AND THOMAS VAIL,
Petitioners,
FILED
vs. AUG 07 2014
THE EIGHTH JUDICIAL DISTRICT
COURT OF THE STATE OF NEVADA, CLEMFE LI4IFLAIVE"
BY
IN AND FOR THE COUNTY OF CHIEF EFEPOITY CLERK
CLARK; AND THE HONORABLE
JESSIE ELIZABETH WALSH,
DISTRICT JUDGE,
Respondents,
and
LEERAD, LP; VIRGINIA BELT; AND
PATRICIA MCGILL,
Real Parties in Interest.
Original petition for a writ of mandamus challenging a district
court order denying a motion to associate out-of-state counsel.
Petition granted.
Snell & Wilmer, LLP, and Kelly H. Dove and Leon F. Mead, II, Las Vegas,
for Petitioners.
Rainey Legal Group, PLLC, and Patrick C. McDonnell and Charles C.
Rainey, Las Vegas,
for Real Parties in Interest.
BEFORE HARDESTY, DOUGLAS and CHERRY, JJ.
OPINION
PER CURIAM:
Following the departure of their attorney from the law firm
representing them, petitioners sought to associate out-of-state counsel in
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the underlying action. Although these attorneys met all of SCR 42's
requirements for admission to practice, the district court denied the
motion to associate, out of concern that granting the request would delay
the imminent start of trial and because petitioners failed to show that out-
of-state counsel were better able to handle the case than their local
counsel. The question we must determine is whether a district court may
deny a motion to associate out-of-state counsel who satisfy all of SCR 42's
requirements. We conclude that such motions should generally be granted
as a matter of course and that, in resolving such a request, the district
court should typically limit its analysis to the requirements for admission
set forth in SCR 42.
In the instant petition, we hold that the possibility of delay did
not provide a valid basis for denying the association request, as petitioners
repeatedly stated that they did not wish to delay trial and the district
court itself can control whether a delay occurs through its resolution of
any requests to continue the trial. Further, any reliance by the district
court on petitioners' purported failure to prove that out-of-state counsel
was more capable of handling their case was improper, as SCR 42 contains
no such requirement. The denial of the motion to associate was therefore
an arbitrary and capricious exercise of the district court's discretion, and
extraordinary relief was warranted to compel the district court to reverse
this determination.
FACTS AND PROCEDURAL HISTORY
Petitioners Imperial Credit Corporation, d.b.a. A.I. Credit
Corporation, and Thomas Vail (collectively, Imperial Credit) were initially
represented by Andras Babero of the law firm Black & Lobello in the
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defense of a lawsuit filed by real parties in interest Leerad LP, Virginia
Belt, and Patricia McGill (collectively, Leerad). Several months before
trial was scheduled to commence, Babero resigned his employment with
Black & Lobello and a newly hired attorney at the firm was assigned to
Imperial Credit's case. Concerned that new counsel was not sufficiently
familiar with its insurance premium financing business to adequately
represent it, Imperial Credit retained out-of-state attorneys Cynthia G.
Burnside and A. Andre Hendrick, both of whom had previously handled
similar cases for the company. After Burnside and Hendrick complied
with SCR 42(3)-(4)'s procedural requirements for out-of-state attorneys
seeking admission to practice in Nevada courts, the company's local
counsel filed in the district court a motion to associate Burnside and
Hendrick. See SCR 42(3)(c).
Without conducting a hearing on the motion, the district court
summarily denied it citing only SCR 42(6), which places the decision to
grant or deny a motion to associate within the district court's discretion.
Imperial Credit subsequently sought reconsideration of that decision,
which was also denied, and this emergency writ petition followed.
As directed, both respondent the Honorable Jessie Walsh,
District Judge, and real party in interest Leerad have filed answers to the
petition, and Imperial Credit has filed a reply. Because of the need for
expedited resolution of the writ petition in advance of the impending June
16, 2014, trial date, this court granted extraordinary relief through an
unpublished order with the caveat that an opinion would follow as the
petition raised important issues in need of clarification. We now explain
our holding.
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DISCUSSION
Standard of review
A writ of mandamus is available to control a district court's
arbitrary or capricious exercise of its discretion. Intl Game Tech., Inc. v.
Second Judicial Dist. Court, 124 Nev. 193, 197, 179 P.3d 556, 558 (2008);
NRS 34.160. While the consideration of a writ petition is within this
court's sole discretion, Smith v. Eighth Judicial Dist. Court, 107 Nev. 674,
677, 818 P.2d 849, 851 (1991), this court may address the merits of a
petition that presents important issues in need of clarification. Mineral
Cnty. v. State, Dep't of Conservation & Natural Res., 117 Nev. 235, 243, 20
P.3d 800, 805 (2001). Because the propriety of a district court's denial of a
motion to associate out-of-state counsel who satisfies all of SCR 42's
admission requirements constitutes an important legal issue requiring
clarification, and because Imperial Credit has no plain, speedy, and
adequate remedy at law, we exercise our discretion to consider the merits
of this petition. NRS 34.170; Mineral Cnty., 117 Nev. at 243, 20 P.3d at
805.
The practice of attorneys not admitted in Nevada
In challenging the denial of its motion to associate out-of-state
counsel, Imperial Credit argues that the district court's decision was
improper because Burnside and Hendrick met all of the requirements for
pro hac vice admission set forth in SCR 42. In response, Judge Walsh
contends that Imperial Credit failed to demonstrate that Burnside and
Hendrick were better able to represent it than their local counsel. And
both Judge Walsh and Leerad assert that allowing Imperial Credit to
associate new counsel shortly before trial would delay trial to the prejudice
of Leerad, and thus, denying the motion to associate was a proper exercise
of the district court's discretion.
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SCR 42 authorizes an attorney licensed to practice law in
another state, but not currently admitted to practice law in Nevada, to
apply for a limited admission to practice in a particular action or
proceeding pending in Nevada state courts. The admission of out-of-state
counsel to practice in a state's courts under these circumstances is
routinely referred to as pro hac vice admission. See Belue v. Leventhal,
640 F.3d 567, 569 (4th Cir. 2011) (defining pro hac vice admission as a
temporary admission "Tor the purpose of conducting a particular case'"
(quoting Black's Law Dictionary 1331 (9th ed. 2009))). In Nevada, an
attorney seeking pro hac vice admission must file a verified application
with the State Bar of Nevada and provide, among other things, certificates
of good standing from the states where the applicant attorney has been
admitted, information regarding the attorney's disciplinary history, and
whether the attorney has previously applied for pro hac vice admission in
Nevada within the last three years. SCR 42(3)-(4). If the State Bar grants
the application, then local counsel may file a motion to associate the
attorney in the district court. SCR 42(3)(c).
The resolution of a motion to associate out-of-state counsel
rests within the district court's discretion. SCR 42(6). But this court has
also recognized the importance of allowing parties to be represented by the
counsel of their choice. See Nev. Yellow Cab Corp. v. Eighth Judicial Dist.
Court, 123 Nev. 44, 53, 152 P.3d 737, 743 (2007) (holding that a party's
interest in being represented by counsel of its choice must be considered
before disqualifying a party's attorney); Millen v. Eighth Judicial Dist.
Court, 122 Nev. 1245, 1257, 148 P.3d 694, 702 (2006) (holding that when a
party's right to counsel of its choice conflicts with a judge's duty to sit, the
party's right generally prevails). Thus, in light of the importance ascribed
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to a party's right to select the counsel of his or her choice, the issue
becomes whether the district court may properly deny a motion to
associate out-of-state counsel when the prospective applicant meets all of
the requirements for admission set forth in SCR 42.
We have not previously addressed the propriety of a district
court's denial of a motion to associate out-of-state counsel under these
circumstances, but other courts that have addressed this issue have
concluded that there is generally no good reason to deny a motion to
associate in the situation presented by this case. See THI Holdings, L.L.C.
v. Shattuck, 93 So. 3d 419 (Fla. Dist. Ct. App. 2012) (concluding that when
out-of-state counsel meet all of the requirements for pro hac vice
admission, the motion for admission should typically be granted); Tobacco
Superstore, Inc. v. Darrough, 207 S.W.3d 511, 517 (Ark. 2005)
(determining that, when the pro hac vice applicant meets all of the
requirements for admission, "there [is] simply no good reason" to deny the
request for admission). The Florida District Court of Appeal's decision in
this regard in THI Holdings is particularly persuasive.
In THI Holdings, the court addressed a trial court's reliance
on criteria not contained in Florida's rule governing pro hac vice admission
to deny a motion for admission brought by out-of-state counsel who met all
of the requirements for admission to practice in Florida courts. 93 So. 3d
at 424-25. The THI Holdings court began its analysis by noting that,
while the denial of such a motion rests within the district court's
discretion, the ruling should nonetheless be based on matters appearing in
the record before the court, such as information casting doubt upon the
applicant's admission to practice in other states or whether the applicant
is in good standing in the jurisdictions in which he or she has been
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admitted. Id. at 423. Further, the court held that the discretionary
nature of such motions does not free the district court to deny the request
on any grounds that it sees fit, and thus, when out-of-state counsel
satisfies all of the requirements set forth in the rule governing pro hac vice
admission in Florida, the motion "should usually be granted on a pro
forma basis." Id. As a result, the THI Holdings court determined that the
failure of the subject attorney to meet criteria outside of the established
requirements for admission cannot constitute "legally permissible"
grounds for refusing to admit out-of-state counsel to practice. Id. at 424.
Accordingly, the court concluded that because the out-of-state attorney
met all of the rule-based requirements for admission, extraordinary relief
was warranted to rectify the district court's denial of the motion to admit
counsel to practice. Id. at 424-25.
Similar to the situation presented in THI Holdings, in
Nevada, SCR 42(6) places the resolution of a motion to associate out-of-
state counsel within the district court's discretion. But the district court's
discretion in this regard is not unlimited. Instead, the district court's
"discretionary power is subject only to the test of reasonableness, [which]
requires a determination of whether there is logic and justification for the
result. The trial courts' discretionary power was never intended to be
exercised in accordance with whim or caprice of the judge nor in an
inconsistent manner!" THI Holdings, 93 So. 3d at 423 (quoting Canakaris
v. Canakaris, 382 So. 2d 1197, 1203 (Fla. 1980)). Stated another way,
such discretion is improperly exercised "when the judicial action is
arbitrary, fanciful, or unreasonable," or "where no reasonable [person]
would take the view adopted by the trial court!" Id. at 422-23 (quoting
Canakaris, 382 So. 2d at 1203); see also Goodman v. Goodman, 68 Nev.
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484, 487, 236 P.2d 305, 306 (1951) (noting, in examining the exercise of
judicial discretion, that a "court cannot act oppressively or arbitrarily
under pretence of exercising discretion. Such arbitrary or oppressive
action under color of exercising discretion is called abuse of discretion."
(internal citations omitted)).
Under these circumstances, we adopt the position taken by the
THI Holdings court and conclude that, when prospective pro hac vice
counsel satisfies all of the requirements for admission under SCR 42, and
a proper motion to associate out-of-state counsel is filed in accordance with
that rule, the motion to associate should generally be granted as a matter
of course. THI Holdings, 93 So. 3d at 423. And when considering a
motion to associate, the district court should generally limit its analysis to
the requirements for pro hac vice admission set forth in SCR 42, such that
the consideration of criteria outside those set forth in that rule may well
constitute an arbitrary and capricious exercise of the district court's
discretion. THI Holdings, 93 So. 3d at 422-23.
Applying this rule to the motion to associate at issue here, our
examination of the district court's denial of Imperial Credit's motion to
associate Burnside and Hendrick necessarily begins with the fact that
these attorneys met all of SCR 42's admission requirements. Among other
things, both attorneys are in good standing with the state bars of the
jurisdictions in which they are admitted, they have had no disciplinary
actions taken against them, and they have not previously applied for pro
hac vice admission in this state. See generally SCR 42 (setting forth the
requirements and procedures for requesting and obtaining pro hac vice
admission); SCR 42(6)(a) (labeling more than five pro hac vice
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appearances in three years as excessive, unless special circumstances
exist).
Despite Burnside's and Hendrick's complete satisfaction of
SCR 42's admission requirements, however, the district court nonetheless
denied Imperial Credit's motion to associate these attorneys, apparently
out of concern that granting the motion shortly before trial would delay
the resolution of the underlying case. But as Imperial Credit points out, it
has repeatedly asserted that it has no desire to delay the trial, and if
Imperial Credit were to later seek to continue the trial based on its
retention of new counsel, the district court itself has the power to prevent
any delay of trial through the exercise of its discretion to deny any such
request. See Bongiovi v. Sullivan, 122 Nev. 556, 570, 138 P.3d 433, 444
(2006) (noting that the grant or denial of a trial continuance rests within
the district court's discretion). As a result, the assertion that Imperial
Credit's association of out-of-state counsel might delay trial cannot
possibly provide a valid basis for denying the motion to associate.
Additionally, to the extent that Judge Walsh justified her
denial of the motion to associate by asserting that Imperial Credit failed to
demonstrate that out-of-state counsel was more capable of handling its
case than local counsel, her reliance on this position was misplaced.
Nothing in SCR 42 requires a party seeking to associate out-of-state
counsel to demonstrate that prospective counsel is more capable of
handling its case than local counsel. Thus, the reliance on this factor,
which lies outside of SCR 42's requirements to deny the motion to
associate constitutes an arbitrary and capricious exercise of the district
court's discretion. THI Holdings, 93 So. 3d at 423.
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CONCLUSION
The district court's refusal to allow Imperial Credit to
associate pro hac vice counsel who met all of the requirements for
admission was an arbitrary and capricious exercise of discretion. We
therefore granted the petition. Accordingly, the clerk of this court issued a
writ of mandamus directing the district court to vacate its order denying
the motion to associate pro hac vice counsel and to instead enter an order
granting that motion.
, J.
Hardesty
cDoG621 (sic.? J.
Douglas
Cife-rry
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