Court Opinion

ID: 3198773
Source: CourtListenerOpinion
Date Created: 2016-04-28 15:05:01.074114+00
Date Added: 2024-06-11T14:50:22.481440
License: Public Domain

FILED
                                                                                  Apr 28 2016, 8:31 am

                                                                                      CLERK
                                                                                  Indiana Supreme Court
                                                                                     Court of Appeals
                                                                                       and Tax Court

      ATTORNEY FOR APPELLANT                                      ATTORNEY FOR APPELLEE
      William J. O’Connor                                         Kevin C. Smith
      Hammond, Indiana                                            Smith Sersic
                                                                  Munster, Indiana

                                                   IN THE
          COURT OF APPEALS OF INDIANA

      Alfonso M. Aguayo and                                       April 28, 2016
      William O’Connor,                                           Court of Appeals Case No.
      Appellants,                                                 45A05-1510-SC-1719
                                                                  Appeal from the Lake Superior
              v.                                                  Court
                                                                  The Honorable Jesse M.
      City of Hammond Inspection                                  Villalpando, Judge
      Department,                                                 Trial Court Cause No.
      Appellee                                                    45D12-1504-SC-391

      Mathias, Judge.

[1]   The Inspection Department of the City of Hammond (“the City”) filed a small

      claims action against Alfonso M. Aguayo (“Aguayo”) in Lake Superior Court

      seeking to recover rental registration fees. Aguayo initially failed to respond,

      and the trial court entered a default judgment in favor of the City. Aguayo then

      hired attorney William O’Connor (“O’Connor”) to represent him and seek to

      have the default judgment set aside. Because O’Connor had previously acted as
      Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016                           Page 1 of 10
      counsel for the City, the City filed a motion to disqualify O’Connor as

      Aguayo’s counsel, which the trial court granted. O’Connor appeals and argues

      that the trial court erred in disqualifying him from serving as counsel in this and

      other similar cases.

[2]   We reverse.

                                      Facts and Procedural History

[3]   O’Connor served as assistant city attorney for the City of Hammond from 1984

      to 1995, when he was appointed as Corporation Counsel for the City.

      O’Connor was terminated from this position in 2000. Four years later, he was

      again hired as the City’s Corporation Counsel. O’Connor then retired from this

      position on July 1, 2013.

[4]   For several years, the City has had an ordinance requiring landlords who rent

      residential property within the City to pay an annual registration fee for each

      rental unit by April 15 of the current year. If this fee is not timely paid, a late fee

      of $500 per unit is owed. Additionally, a fine no less than $300 nor more than

      $2,500 may be imposed. See Hammond, Ind., Code of Ordinances § 96.152

      (2011).

[5]   On August 15, 2005, Aguayo executed a document titled “Agreement to Sell

      Real Estate.” Appellant’s App. p. 15. This document set forth an agreement to

      sell Aguayo’s real estate on contract to Humberto Moran (“Moran”) for

      $80,000. Id. The agreement provided that Moran would pay $8,175.49 up front,

      Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016    Page 2 of 10
      with the remaining balance to be paid in monthly installments of $833.88 for

      120 months. Id.

[6]   On April 15, 2015, the City filed a notice of claim against Aguayo in small

      claims court seeking to recover an unpaid rental registration fee of $320 plus

      late fees of $2,000. Apparently, the City considered the agreement between

      Aguayo and Moran to be a rental agreement. Aguayo was served by certified

      mail with the City’s complaint on April 20, 2015. At the small claims hearing

      held on May 12, 2015, Aguayo failed to appear, and the City moved for default

      judgment, which the trial court granted.

[7]   Aguayo then hired O’Connor to represent him in the matter. On May 22, 2015,

      counsel for the City sent a letter to O’Connor, in which he stated, “If Mr.

      Aguayo, pro se, wishes to move to set aside the default judgment, I would not

      object, however, should you attempt to enter your appearance in this matter I

      will file a motion to disqualify you based upon your conflict of interest with the

      City of Hammond.” Appellant’s App. p. 43.

[8]   On June 10, 2015, O’Connor filed an appearance on behalf of Aguayo and filed

      a motion to set aside the default judgment. On June 16, 2015, the City filed a

      motion to disqualify O’Connor because of his previous service as Corporation

      Counsel for the City. O’Connor responded to this motion and claimed that he

      had appeared in other cases where the City was a party without objection. He

      also claimed that the City had recently begun to file objections to his

      appearance in all cases in which he represented a client being sued by the City.

      Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016   Page 3 of 10
[9]   On September 4, 2015, the trial court held a hearing on the matter. Counsel for

      the City indicated that it intended to dismiss its claim against Aguayo with

      prejudice, regardless of how the trial court ruled on the motion to disqualify.

      O’Connor argued that the question was therefore moot. The trial court

      acknowledged that the “easy way out” was to grant the City’s request to dismiss

      the action, thereby rendering the disqualification issue moot. Tr. p. 23. The trial

      court, however, was concerned that this issue would simply reoccur in another

      case. Yet, what concerned the trial court the most was the level of personal

      animosity that O’Connor and counsel for the City seemed to display toward

      each other. Indeed, the court expressed its disappointment with both parties:

              So it bothers me here is that all that history, whether we were on
              the same side or not, that there is always respect. What I’ve seen
              here is deviation from that. That’s what bothers me.
              Because none of us are strangers to controversy. We may have
              opponents, but we’ve never had enemies. What did Nixon say at
              the very end, too late of course; never hate your enemies, because
              if you do you end up destroying yourself. Lesson learned [too]
              late for him, but he was right. . . .
              My concern here is you guys with this stridency you’re taking it
              up, you’re ratcheting it up to more than just a legal issue here of
              conflict which it’s a conflict. It is a conflict. The question is there
              is all kinds of, everyday, there is conflicts in this county. It
              wouldn’t be Lake County if we didn’t have conflicts. What you
              try and do is you disclose them up front and business as usual.
              This is not business as usual here. There is something going on
              that I’m not seeing. I exposed a little bit of this. This ancillary

      Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016     Page 4 of 10
               lawsuit[]. And I’m very disheartened to hear about disciplinary
               issues.. . .[1]
               But what I’m concerned about mainly, quite frankly, is you two
               guys. Both public servants trying to represent your clients as best
               you can in a tough environment. Yes, and I know how it can
               sometimes devolve into personal animosity. It’s not healthy.
               Believe me, I know that. It’s not healthy.

       Tr. pp. 24-27.

[10]   The trial court took the matter under advisement, and on September 14, 2015,

       entered an order granting the motion to disqualify O’Connor, which concluded

       that “O’Connor may not represent private clients against his former client, the

       City of Hammond, in transactions similar to the one in the above-entitled

       cause.” Appellant’s App. pp. 8-9. The trial court then granted the motion to set

       aside the default judgment and, on September 24, 2015, dismissed the case

       against Aguayo. O’Connor now appeals.

                                          Discussion and Decision

[11]   On appeal, O’Connor contends that the trial court’s order disqualifying him

       was improper for three main reasons: (1) the trial court was without authority

       or jurisdiction to partially “disbar” O’Connor; (2) the trial court should not

       have ruled on the motion to disqualify because the case was moot; and (3) that

       O’Connor’s representation of clients being sued by the City for ordinance

       1
        According to the City’s counsel, O’Connor had filed disciplinary complaints against him, the City’s mayor,
       and the City’s current Corporation Counsel.

       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016                      Page 5 of 10
       violations did not constitute a violation of the Indiana Rules of Professional

       Conduct.2

       A. The Trial Court’s Authority to Rule on a Motion to Disqualify

[12]   O’Connor first argues that the trial court was without authority or jurisdiction

       to “partially disbar” him because only the Indiana Supreme Court has authority

       and jurisdiction to discipline or disbar attorneys. The City argues that trial

       courts have authority to disqualify attorneys who appear in matters before

       them. Both parties are partially correct.

[13]   The Indiana Supreme Court has “exclusive jurisdiction over . . . [m]atters

       relating to the practice of law including . . . [t]he discipline and disbarment of

       attorneys admitted to the practice of law[.]” Ind. Appellate Rule 4(B)(1)(b); see

       also Ind. Const. art. VII, § 4 (providing that the Indiana Supreme Court has

       original jurisdiction in matters of “discipline and disbarment of those admitted

       [to the practice of law].”); In re Murgatroyd, 741 N.E.2d 719, 721 (Ind. 2001)

       (noting that those performing acts constituting the practice of law are subject to

       the “exclusive jurisdiction” of the Indiana Supreme Court “to regulate

       professional legal activity in this state.”). Thus, O’Connor is correct that only

       the Indiana Supreme Court may discipline or disbar him.

       2
         O’Connor also briefly requests that we grant him appellate attorney fees, but he does not develop this
       argument fully or cite to any authority. We therefore decline to address his underdeveloped claim. See Smith
       v. State, 822 N.E.2d 193, 202-03 (Ind. Ct. App. 2005) (“Generally, a party waives any issue raised on appeal
       where the party fails to develop a cogent argument or provide adequate citation to authority and portions of
       the record.”) (citing Ind. Appellate Rule 46(A)(8)(a)).

       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016                        Page 6 of 10
[14]   However, our supreme court has also held that “[a] trial court may disqualify

       an attorney for a violation of the Rules of Professional Conduct that arises from

       the attorney’s representation before the court.” Cincinnati Ins. Co. v. Wills, 717

       N.E.2d 151, 154 (Ind. 1999) (citing State v. Romero, 578 N.E.2d 673, 676-77

       (Ind. 1991)). The trial court’s authority to disqualify attorneys is “necessary to

       prevent ‘insult and gross violations of decorum.’” Id. (quoting McQueen v. State,

       272 Ind. 229, 231, 396 N.E.2d 903, 904 (1979)). Importantly, however, this

       authority is limited to attorneys appearing before the court. Id. “More precisely,

       the authority of the trial court is limited to disqualification in the case before the

       court.” Id. (emphasis added).

[15]   Thus, the trial court’s order disqualifying O’Connor in the present case was within

       the trial court’s authority. However, to the extent that the order purports to

       limit O’Connor’s ability to represent clients in other cases, the order exceeded

       the authority of the trial court. In the future, O’Connor’s ability to represent

       clients in other cases involving the City will have to be decided by the trial court

       (or courts) hearing those cases.

       B. Mootness

[16]   O’Connor also claims that the case before the trial court was moot because the

       City had indicated that it was prepared to dismiss the case against Aguayo

       regardless of how the trial court ruled on its motion to disqualify. An issue

       becomes moot when it is no longer live and the parties lack a legally cognizable

       interest in the outcome, or when no effective relief can be rendered to the

       parties. Castetter v. Lawrence Twp., 959 N.E.2d 837, 841 (Ind. Ct. App. 2011). An
       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016      Page 7 of 10
       actual controversy must exist at all stages of the appellate review, and if a case

       becomes moot at any stage, then the case is remanded with instructions to

       dismiss. Id.

[17]   We conclude that the disqualification issue was not moot when the trial court

       entered its order on the motion to disqualify because the City had not yet filed a

       motion to dismiss the matter. Indeed, the case against Aguayo was not

       dismissed until ten days after the trial court had issued its order disqualifying

       O’Connor. Thus, an actual controversy was before the trial court—whether

       O’Connor should be disqualified from representing clients with interests

       adverse to the City.

       C. Violations of Rules of Professional Conduct

[18]   O’Connor also claims that the trial court erred in concluding that he violated

       the Rules of Professional conduct such that he should have been disqualified

       from representing other clients with interests adverse to the City. The City

       argues that the trial court rightly disqualified O’Conner from the present case.

[19]   A serious problem arises if we attempt to address this issue on the merits,

       because the case against Aguayo has already been dismissed. We have already

       concluded above that the trial court’s order, as far as it purports to disqualify

       O’Connor in future cases, is outside the authority of the trial court. Thus, even

       if we were to agree with O’Connor that the trial court erred in disqualifying

       him, the only effect this would have would be with regard to the trial court’s

       disqualification of O’Connor in the instant case—a case which has already been

       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016   Page 8 of 10
       dismissed. Accordingly, we would not be able to afford any relief to O’Connor

       (or Aguayo) in the present case. Simply, the only portion of the trial court’s

       disqualification order that has any continuing force is the same portion we have

       concluded was beyond the trial court’s authority. Accordingly, we decline to

       address the issue of whether the trial court’s disqualification order was proper

       because the issue of the disqualification order is moot as it pertains to the

       present case, and we can render no effective relief. See Castetter, 959 N.E.2d at

       841.

[20]   This does not leave O’Connor without recourse. As noted above, when and if

       this issue is presented again, the trial court in that case will have to determine

       whether O’Connor should be disqualified based on the facts and circumstances

       of that case. If the trial court disqualifies O’Connor, then O’Connor should seek

       to have the trial court’s order certified for interlocutory appeal. If the trial court

       denies the request to certify its order for interlocutory appeal, so long as the

       City does not again dismiss the case against O’Connor’s client,3 he may still

       appeal the issue in a case in which we would be able to afford the injured party

       effective relief.

                                                          Conclusion

[21]   The issue of O’Connor’s disqualification was not moot at the time of the trial

       court’s order. The trial court’s order disqualifying O’Connor was a valid

       3
           If the City repeatedly dismisses its claims against O’Connor’s clients, this surely only benefits his clients.

       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016                                 Page 9 of 10
       exercise of the trial court’s authority, but only to the extent it disqualified

       O’Connor from the case immediately before the trial court. Once the case was

       dismissed on motion of the City, that dismissal mooted much of the trial court’s

       disqualification order as pertained to that case. However, the trial court

       exceeded its authority to the extent that it purported to disqualify O’Connor

       from representing clients with interests adverse to the City in future cases. We

       therefore reverse that portion of the trial court’s disqualification order.

[22]   In summary, the issue of O’Connor’s disqualification in the present case is now

       moot as the City filed a motion to dismiss the case against Aguayo, which the

       trial court granted. Accordingly, we decline to address the merits of the trial

       court’s disqualification order vis-à-vis the present case. Therefore, the only

       active issue before us is the trial court’s order barring O’Connor from

       representing clients with adverse interests to the City in future cases, and on this

       issue, we reverse the trial court’s order, as the trial court had no authority to

       rule beyond the case before it.

[23]   Reversed.

       Kirsch, J., and Brown, J., concur.

       Court of Appeals of Indiana | Opinion 45A05-1510-SC-1719 | April 28, 2016     Page 10 of 10