Opinion ID: 1146557
Heading Depth: 2
Heading Rank: 4

Heading: Adequacy Of Representation By Existing Parties

Text: Finally, Rule 24(a)(2) requires that GNIC establish that its interest in this matter is not adequately represented by existing parties. The Circuit Court ruled against GNIC on this point as well, finding that its interest was adequately represented by Hardin and his counsel of record. Again, the Circuit Court was in error. It may be true that Hardin also was seeking to set aside the default judgment. In this technical sense the legal interests of GNIC and Hardin were similar. Rule 24, however, as indicated above, mandates sensitivity to practical considerations. The almost certain inability of Hardin to pay a $400,000.00 judgment or any substantial portion thereof  back on June 26, 1985  rendered it highly unlikely that his protection of the common interest of GNIC and himself would be with the same vigor as has been brought to the matter by GNIC, which we assume is quite solvent. Moreover, the record reflects that prior to intervention  on May 13, 1985, to be specific  Hardin had commenced a civil action in the United States District Court for the Northern District of Mississippi against GNIC, among others, presenting all sorts of real and imagined claims and demanding no less than $5,000,000.00 in actual and punitive damages. That action arises out of GNIC's handling of the case at bar. Its pendency ipso facto suggested, again as a practical matter, a substantial conflict of interest between GNIC and Hardin to the point that GNIC should not be required to rely upon Hardin to protect its interest. The inadequacy of Hardin's representation in the matter is confirmed by the fact that Hardin has taken no appeal from the Circuit Court's order denying the two motions for leave to vacate and set aside the default judgment. The fact that GNIC, under its duty to defend and with full reservation of rights, had engaged counsel, Shelby Duke Goza, Esq., to represent Hardin in no way suggests that intervention should be denied on the adequacy of representation issue. Insurer employed counsel have an absolute and uncompromisable ethical duty to protect the insureds, the Bobby Eugene Hardins, they are engaged to represent. Goza was ethically bound to proceed in Hardin's interest, and in Hardin's interest alone, not only when but particularly when that interest might require that he displease GNIC, all of this notwithstanding that GNIC may have been obligated to pay Goza's fee.