Harris & Hilton, P.A. v. Rassette
252 N.C. App. 280
| N.C. Ct. App. | 2017Background
- Harris & Hilton, P.A. sued James C. Rassette in Wake County District Court to recover about $16,935.69 in unpaid legal fees.
- The firm’s principals and proposed trial counsel, Nelson G. Harris and David N. Hilton, were also listed as witnesses who would testify about disputed facts (including whether a contract existed).
- At a pretrial conference Judge Sasser found both attorneys would be necessary witnesses and, pursuant to Rule 3.7 of the North Carolina Rules of Professional Conduct, disqualified them from acting as trial counsel for the firm.
- Harris & Hilton appealed the disqualification order; the Court of Appeals found the order immediately appealable because disqualification affects a substantial right.
- The firm asked the Court to create a categorical exception to Rule 3.7 for fee-collection cases (or otherwise permit firm attorneys to both testify and serve as advocates); the court declined, holding it lacked authority to rewrite the Rule.
- The Court affirmed the disqualification, noting Rule 3.7’sexceptions did not apply and existing precedent supports disqualification where attorneys are necessary witnesses in fee disputes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether disqualification under Rule 3.7 is proper when firm attorneys are necessary witnesses in a fee collection suit | Rule 3.7 should not apply in fee-collection cases; firm attorneys should be allowed to both testify and represent the firm (analogous to pro se appearance) | Rule 3.7 applies; combining advocate and witness roles prejudices the tribunal and opposing party; no exception exists for fee suits | Court affirmed disqualification under Rule 3.7; no new categorical exception created |
| Whether immediate appeal was proper from interlocutory disqualification order | Disqualification of chosen counsel affects a substantial right and is immediately appealable | Order is interlocutory and not final | Court held immediate appeal permissible because disqualification affects a substantial right |
Key Cases Cited
- Robinson & Lawing, L.L.P. v. Sams, 161 N.C. App. 338 (2003) (disqualification order is immediately appealable and Rule 3.7 applied in fee-recovery context)
- Duval v. OM Hospitality, LLC, 186 N.C. App. 390 (2007) (standards for interlocutory appeal jurisdiction)
- LexisNexis, Div. of Reed Elsevier, Inc. v. Travishan Corp., 155 N.C. App. 205 (2002) (corporations cannot appear pro se)
- Mebane v. Iowa Mut. Ins. Co., 28 N.C. App. 27 (1975) (State Bar authority to adopt professional conduct rules)
- State v. Rogers, 219 N.C. App. 296 (2012) (competent evidence may support disqualification under Rule 3.7)
- Braun v. Tr. Dev. Grp., LLC, 213 N.C. App. 606 (2011) (trial court did not err disqualifying plaintiff's attorneys who were necessary witnesses)