Court Opinion

ID: 2700695
Source: CourtListenerOpinion
Date Created: 2014-08-04 19:24:16.339023+00
Date Added: 2024-06-11T12:52:51.585174
License: Public Domain

[Cite as Bank of New York v. Aponte, 2013-Ohio-4360.]
                           STATE OF OHIO, MAHONING COUNTY

                                 IN THE COURT OF APPEALS

                                       SEVENTH DISTRICT

THE BANK OF NEW YORK,                            )
                                                 )      CASE NO. 12 MA 125
        PLAINTIFF-APPELLEE,                      )
                                                 )
        - VS -                                   )            OPINION
                                                 )
FELIX R. APONTE, et al.,                         )
                                                 )
        DEFENDANTS-APPELLANTS.                   )

CHARACTER OF PROCEEDINGS:                               Civil Appeal from Common Pleas
                                                        Court, Case No. 10 CV 4681.

JUDGMENT:                                               Affirmed.

APPEARANCES:
For Plaintiff-Appellee:                                 Attorney Wayne Ulbrich
                                                        Lerner, Sampson & Rothfus
                                                        P.O. Box 5480
                                                        Cincinnati, OH 45201-5480

                                                        Attorney David A. Wallace
                                                        Attorney Karen M. Cadieux
                                                        Carpenter, Lipps & Leland LLP
                                                        280 Plaza Suite
                                                        280 North High Street
                                                        Columbus, OH 43215

For Defendants-Appellants:                              Attorney Bruce Broyles
                                                        5815 Market Street, Suite 2
                                                        Youngstown, OH 44512

JUDGES:
Hon. Mary DeGenaro
Hon. Gene Donofrio
Hon. Cheryl L. Waite

                                                        Dated: September 24, 2013
[Cite as Bank of New York v. Aponte, 2013-Ohio-4360.]
DeGenaro, P.J.
        {¶1}    Defendants-Appellants, Felix R. and Barbara Aponte, appeal the decision of
the Mahoning County Court of Common Pleas granting Plaintiff-Appellee, The Bank of
New York Mellon Trust Company's motion to disqualify the Apontes' counsel on the basis
of a conflict of interest. On appeal, the Apontes argue that the trial court erred in
disqualifying their counsel based upon an alleged conflict of interest pursuant to the rules
of professional conduct and upon an apparent conflict of interest.
        {¶2}    Upon review, the Apontes' arguments are meritless. Broyles representing
both sides in the same lawsuit constitutes a conflict of interest which NY Mellon did not
waive and creates the appearance of impropriety.           The trial court did not err in
disqualifying Broyles from continuing to represent the Apontes based upon his
representation of NY Mellon at the default judgment hearing. Accordingly, the judgment
of the trial court is affirmed.
                                  Facts and Procedural History
        {¶3}    On December 17, 2010, NY Mellon filed a complaint in foreclosure against
the Apontes, who did not file an answer. On February 24, 2011, NY Mellon filed a motion
for default judgment.
        {¶4}    At the April 5, 2011 hearing for default judgment, Attorney Bruce Broyles
appeared on behalf of NY Mellon, and the Apontes did not appear. Broyles presented a
judgment entry and the trial court entered default judgment and a decree of foreclosure
on that date against the Apontes in favor of NY Mellon.
        {¶5}    Ten months later, the property was scheduled to be sold on February 14,
2012, and Broyles was retained by the Apontes to represent them in the foreclosure
proceedings. On February 9, 2012, Broyles filed on their behalf a motion for relief from
judgment and a stay of execution seeking, inter alia, cancellation of the sheriff's sale.
The trial court cancelled the sheriff's sale on February 13, 2012, and one month later NY
Mellon filed a memorandum in opposition to the Apontes's motion for relief from
judgment.
        {¶6}    On May 7, 2012, NY Mellon filed a motion to disqualify Broyles as counsel
for the Apontes based on his previous representation of NY Mellon, and Broyles filed an
                                                                                          -2-

opposition brief on the Apontes' behalf. On May 23, 2012, the magistrate sustained NY
Mellon's motions to disqualify Broyles and striking the Civ.R. 60(B) motion he had filed on
the Apontes' behalf, finding that there was an apparent conflict of interest.
       {¶7}   On June 6, 2012, Broyles filed objections to the magistrate's decision on
behalf of the Apontes alleging his disqualification from representing the Apontes was an
error of law. In its June 12, 2012 judgment entry the trial court overruled the objections
and adopted the magistrate's decision in whole:

       "Due to the apparent inadvertence of counsel's conflict, Defendant Aponte
       shall have 45 days to obtain new counsel and an additional 15 days to re-
       file his motion for relief from judgment, per Civ.R. 60(B). Plaintiff shall have
       15 days to file any response to said motion(s) of Defendant."

                                  Disqualification of Counsel
       {¶8}   On appeal the Apontes assert two assignments of error which are
interrelated and will be discussed together:
       {¶9}   "The trial court erred in disqualifying counsel based solely upon an alleged
conflict of interest pursuant to Prof. Cond. Rule 19(a) [sic]."
       {¶10} "The trial court abused its discretion in disqualifying counsel based upon the
apparent conflict of interest."
       {¶11} The trial court has wide latitude when considering a motion to disqualify
counsel. Spivey v. Bender, 77 Ohio App.3d 17, 22, 601 N.E.2d 56 (7th Dist.1991). The
order to disqualify an attorney from representing a client in a civil case is a final
appealable order pursuant to R.C. 2505.02(B)(4), Westfall v. Cross, 144 Ohio App.3d
211, 218-219, 2001-Ohio-3299, 759 N.E.2d 881 (7th Dist.2001) subject to an abuse of
discretion standard of review. 155 N. High Ltd. v. Cincinnati Ins. Co., 72 Ohio St.3d 423,
426, 1995-Ohio-85, 650 N.E.2d 869. "The term 'abuse of discretion' means an error in
judgment involving a decision that is unreasonable based upon the record; that the
appellate court merely may have reached a different result is not enough." In re S.S.L.S.,
7th Dist. Columbiana No. 12 CO 8, 2013-Ohio-3026, ¶22. Any doubts as to the existence
                                                                                          -3-

of an asserted conflict of interest must be resolved in favor of disqualification in order to
dispel any appearance of impropriety. Kala v. Aluminum Smelting & Refining Co., Inc., 81
Ohio St.3d 1, 11, 1998-Ohio-439, 688 N.E.2d 258.
       {¶12} Broyles alternatively argues on behalf of the Apontes that the limited scope
of his prior representation of NY Mellon in this matter, covering a default hearing for NY
Mellon's counsel of record, creates neither a conflict of interest, nor constitutes a violation
of Prof. Cond. Rule 1.9(a). NY Mellon argues that disqualification was proper because
representing both sides in the same lawsuit is a clear conflict of interest which NY Mellon
did not waive and which also has the appearance of impropriety.
       {¶13} Ohio Rule of Professional Conduct Rule 1.9(a) discusses an attorney's
duties to former clients: "Unless the former client gives informed consent, confirmed in
writing, 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." Id. It is
undisputed that NY Mellon did not give consent to Broyles to represent the Apontes in this
matter.
       {¶14} This court has applied a three-part test for disqualification of counsel due to
a conflict of interest: "1) a past attorney-client relationship must have existed between the
party seeking disqualification and the attorney he or she wishes to disqualify; 2) the
subject matter of the past relationship must have been substantially related to the present
case; and 3) the attorney must have acquired confidential information from the party
seeking disqualification." City of Youngstown v. Joenub, Inc., 7th Dist. Mahoning No. 01-
CA-01, 2001-Ohio-3401, ¶15, citing Dana Corp. v. Blue Cross & Blue Shield Mut. of N.
Ohio, 900 F.2d 882, 889 (6th Cir.1990).
       {¶15} Turning to the first prong, Broyles argues that there was no prior attorney-
client relationship between him and NY Mellon. Broyles admits to attending the default
judgment hearing and two other hearings unrelated to this appeal, at the request of the
law firm of Lerner, Sampson and Rothfuss who represented NY Mellon. Broyles attended
the hearing, waited until the Apontes did not appear and left documents, including the
                                                                                      -4-

judgment entry and decree in foreclosure, with the magistrate. Broyles then invoiced the
firm for his services. Broyles contends that he was providing a service to the law firm and
not to NY Mellon as he had no authority to make any representations to the court and did
not advocate for any position in the case. He provides no case law to support this
proposition.
       {¶16} Contrary to Broyles assertion, an attorney-client relationship may be created
by implication based upon the conduct of the parties and the reasonable expectations of
the person seeking representation. See Cuyahoga County Bar Association v. Hardiman,
100 Ohio St.3d 260, 2003-Ohio-5596, 798 N.E.2d 369, syllabus. Broyles appeared at the
default judgment hearing on behalf of NY Mellon. He invoiced for this service and
received payment for same. Based on these facts, it is reasonable that NY Mellon
believed an attorney-client relationship had been formed. This prong has been met.
       {¶17} As to the second prong, the subject matter of the past relationship must
have been substantially related to the present case.        Under Prof. Cond.R. 1.0(n),
"substantially related matter" "involves the same transaction or legal dispute or one in
which there is a substantial risk that confidential factual information that would normally
have been obtained in the prior representation of a client would materially advance the
position of another client in a subsequent matter."         This prong has been met.
Disqualification is based upon Broyles' representation of both parties within the same
transaction: first, appearing on behalf of NY Mellon at the default judgment hearing and
obtaining judgment in the foreclosure action initiated by NY Mellon against the Apontes;
and then seven months later filing for relief from judgment and successfully having the
sheriff's sale of the home cancelled on behalf of the Apontes.
       {¶18} Regarding the third prong, the attorney must have acquired confidential
information from the party seeking disqualification. Broyles maintains that he never
acquired confidential information as he was merely appearance counsel and had no
ability to take action on behalf of NY Mellon.

       "Where an attorney himself represented a client in matters substantially
                                                                                        -5-

       related to those embraced by a subsequent case he wishes to bring against
       the former client, he is irrebuttably presumed to have benefitted from
       confidential information relevant to the current case.        In such limited
       situations there is no necessity to demonstrate actual exposure to specific
       confidences which would benefit the present client." Carr v. Acacia Country
       Club Co., 8th Dist. Cuyahoga No. 91292, 2009-Ohio-628, ¶ 26, citing
       Cleveland v. Cleveland Elec. Illuminating Co., 440 F.Supp. 193, 210 (1976).

       {¶19} We are persuaded by the analysis of our sister district. It logically follows
this presumption applies to an attorney who represents a client in the same case against
a former client, a situation fraught with more, rather than less, confidentiality concerns on
the part of the former client. As Broyles represented NY Mellon in the same case it is not
necessary to demonstrate he was actually exposed to specific confidences; Broyles is
irrebuttably presumed to have benefitted from confidential information. Thus, all three
prongs of the disqualification test articulated in Joenub and Dana have been met.
                               Appearance of Impropriety
       {¶20} Although the conflict in this case is clear, even in a close case
disqualification is favored to dispel any appearance of impropriety that an asserted
conflict of interest presents. In Kala, supra, the Ohio Supreme Court affirmed the
appellate court's decision disqualifying a law firm from continuing to represent their client
in an appellate proceeding due to the appearance of impropriety. Id. at 14, 688 N.E.2d
258. The law firm represented the employer-defendant in a wrongful termination action at
the trial court level and, after appellate proceedings commenced, the law firm employed
the attorney that had been representing the employee-plaintiff at trial. Id. at 2, 688
N.E.2d 258. The Ohio Supreme Court recognized that the employee's former attorney
possessed the plaintiff's confidences and secrets, and imposed a presumption that the
former attorney for the employee revealed the confidences and secrets to the law firm
representing the employer given that the former attorney and the law firm had been
involved in the wrongful termination litigation at the trial court level as opposing counsel.
                                                                                      -6-

Id. at 13, 688 N.E.2d 258.
       {¶21} The Ohio Supreme Court then concluded that, despite the law firm's claims
that it took steps to ensure that the employee-plaintiff's former attorney did not reveal
confidences and secrets to the law firm which was still representing the employer-
defendant on appeal, "[t]he appearance of impropriety is so strong that nothing that [the
law firm representing the employer] could have done would have had any effect on [the
employee-plaintiff's] perception that his personal attorney had abandoned him with all of
his shared confidences[.]" Id. at 14, 688 N.E.2d 258. "No steps of any kind could
possibly replace the trust and confidence that [the employee-plaintiff] had in his attorney
or in the legal system" if the appellate court had allowed the law firm to continue to
represent the employer-defendant. Id.
       {¶22} The same rationale applies to the present case. Permitting Broyles to
represent the Apontes and attempt to vacate the very judgment he obtained on behalf of
NY Mellon offends the notions of trust and confidence that the public, including NY
Mellon, have when retaining counsel and in our legal system. Disqualification was
necessary and proper to dispel the appearance of impropriety in this case.
       {¶23} In sum, the Apontes's arguments are meritless. Broyles representing both
sides in the same lawsuit constitutes a conflict of interest which NY Mellon did not waive
and creates the appearance of impropriety. The trial court did not err in disqualifying
Broyles from continuing to represent the Apontes based upon his representation of NY
Mellon at the default judgment hearing. Accordingly, the judgment of the trial court is
affirmed.
Donofrio, J., concurs.
Waite, J., concurs.