Court Declines Disqualification Under Lawyer Witness Rule

On April 3, 2015, Justice Kornreich of the New York County Commercial Division issued a decision in Salomone v. Abramson, 2015 NY Slip Op. 25097, refusing to disqualify counsel under the lawyer witness rule.

In Salomone, the defendants moved to disqualify the law firm representing the plaintiffs on the ground that two lawyers at the firm were "necessary witnesses, that their testimony will be prejudicial to their client, and that the Firm's continued representation violates Rule of Professional Conduct 3.7, the advocate witness rule (Rule)." The court denied the motion, explaining, with respect to the lawyer witness rule,:

In determining whether to disqualify an attorney on the ground that he or she will likely be a witness, the court is guided, but not bound by, the standards set forth in Rule 3.7, and whether to disqualify an attorney rests in the sound discretion of the Court.

The policy behind the Rule is that the roles of advocate and witness are inconsistent, and it is unseemly for a lawyer to argue his own credibility as a witness during a trial.

In applying the Rule, a court must consider a litigant's valued right to select its own counsel and the fairness and effect of disqualification in the particular factual setting. Restrictions on a party's right to select representation by a particular attorney should be carefully scrutinized because disqualification can be used as a tactic to stall and derail the proceedings, redounding to the strategic advantage of one party over another. The Rule is subject to an exception where withdrawal would work a substantial hardship on the client because of the distinctive value of the lawyer as counsel in the particular case.

The necessity of the attorney's testimony takes into account such factors as the significance of the matters, the weight of the testimony and the availability of other evidence. A party seeking disqualification must make a showing that the testimony of plaintiff's attorney will be necessary to establish the claim or be prejudicial to the plaintiff in the event the attorney is called by the other side. However, where the attorney's testimony is necessary to support his client's claim, it is not essential to show that the attorney's testimony will have a potentially prejudicial impact on his or her client.

A disqualification motion can be granted before discovery is complete in certain circumstances. Where the substance and necessity of the attorney's testimony is unknown, a decision on disqualification should await discovery. On the other hand, where there is little doubt as to the substance of the lawyer's testimony or whether it is necessary to prove a party's claim, then disqualification need not await completion of discovery.

(Internal quotations and citations omitted) (emphasis added). The court went on to hold that one of the lawyers would be "a necessary witness" and should be "disqualified, unless" the defendants had "waived their right to that relief or delayed too long in making the motion." With regard to that issue, the court explained:

A motion to disqualify should be denied where a delay in making the motion is inordinate and inadequately explained. The First Department has held that the moving party's laches in making a disqualification motion is a relevant consideration and that an inordinate delay in moving for such relief is an indication that the motion has been made to gain a tactical advantage in the litigation.

. . .

This action was filed in 2008. In the January 2007 Letter, Movants were aware of the IA coverage issues with respect to the Termination Claim and the WPP Action fraud claims, and expressed concerns about prompt resolution. In the October 2010 Letter, Movants complained to Lebowitz of Salomone's failure to settle the WPP Cases due to his pursuit of the Termination Claim. It is undisputed that in January 2013, Movants did not oppose the retention of LLO as special counsel to Salomone in the Bankruptcy, where Salomone sought leave for LLO to help with the Adverse Proceedings, which included the same claims made in this action. Lebowitz would have had to testify as to the same matters in the Bankruptcy, had it not been resolved by settlement.

From these facts, it is clear there was a waiver.

(Internal quotations and citations omitted).