Fiduciary Trust International v. Superior Court
218 Cal. App. 4th 465
| Cal. Ct. App. | 2013Background
- Sandler & Rosen drafted Willet and Betty Brown's wills in 1992; Willet's will created a Marital Trust and an Exemption Equivalent Trust for the four children.
- Betty's 1992 will was later revoked and Betty created the Betty Brown Trust benefiting her daughter Kim; Betty's trust directed taxes to be paid by the Marital Trust unless other provisions were made.
- Betty died in 2011; Fiduciary Trust International of California (Fiduciary) administered Betty's estate; tax obligations of about $27 million arose on Betty's assets.
- The Marital Trust trustees paid taxes on their portion but refused to pay taxes attributable to Betty Brown Trust assets.
- Fiduciary filed to disqualify Sandler & Rosen based on prior representation of Betty; trial court denied disqualification, and Fiduciary sought writ of mandate.
- The appellate court granted the writ, concluding Sandler & Rosen must be disqualified due to substantial relationship and lack of proper consent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a substantial relationship exists between Betty's prior representation and the current dispute | Fiduciary asserts a substantial relationship controls disqualification. | Trustees contend joint prior representation and lack of confidentiality negate need to disqualify. | Yes; substantial relationship exists requiring disqualification. |
| Whether joint prior representation bars application of the substantial relationship rule | Zador requires consent-based approach; substantial relationship applies regardless of joint representation. | Joint representation should excuse it under Croce and related authorities. | No; joint representation does not defeat disqualification where a substantial relationship exists and consent was not obtained. |
| Whether Zador requires informed written consent despite the time period | Zador governs consent and disclosure; consent was not obtained. | Zador misapplied; rules at 1992 were not applicable to require Betty's consent. | Yes; disqualification proper under Zador's framework for consent and disclosure. |
| Whether Betty waivered disqualification by delay | No waiver due to substantial prejudice; delay cannot bar relief. | Delay is a waiver if extreme and prejudicial. | No prima facie extreme delay shown; no implied waiver. |
Key Cases Cited
- Jessen v. Hartford Casualty Insurance Company, 111 Cal.App.4th 698 (2003) (conflicts and disqualification; substantial relationship framework)
- Flatt v. Superior Court, 9 Cal.4th 275 (1994) (substantial relationship analysis for former and current representations)
- In re Charlisse C., 45 Cal.4th 145 (2008) (test for conflict and attorney's duty to avoid adverse representations)
- SpeeDee Oil Change Systems, 20 Cal.4th 1135 (1999) (confidentiality and attorney duty to preserve integrity of justice)
- Western Continental Operating Company v. Natural Gas Corporation of California, 212 Cal.App.3d 752 (1989) (joint-client privilege vs. disqualification ethics considerations)
- Croce v. Superior Court, 21 Cal.App.3d 18 (1937) (joint representation; limits of Croce in modern disqualification)
- Industrial Indemnity Co. v. Great American Ins. Co., 73 Cal.App.3d 529 (1977) (joint defense and evolving conflict rules)
- Zador v. Kwan, 31 Cal.App.4th 1285 (1995) (consent and disclosure controls when former joint clients are adverse)
- Cornish v. Superior Court, 209 Cal.App.3d 467 (1989) (fact-specific assessment of disqualification in joint representation)
- Western Continental Operating Co. v. Natural Gas Corp. of California, 212 Cal.App.3d 752 (1989) (evidentiary privilege vs. professional ethics in disqualification)
- City National Bank v. Adams, 96 Cal.App.4th 315 (2002) (principles on confidentiality and former client information)