Ethics Opinion

Summary: Where a lawyer and his firm otherwise would be required to withdraw from representation of a client in a pending action (because the lawyer finds that he will be a witness in the case), and where the pending action is relatively simple in nature, the fact that the client may have to incur some additional expense in order to have new trial counsel become familiar with the case probably will not constitute "a substantial hardship on the client because of the distinctive value of the lawyer or his firm as counsel in the particular case," for purposes of Disciplinary Rule DR 5-101(B)(4).

Facts: Attorney A, an associate in the firm of B & C, has represented Client X for several years. In 1971 X entered into a written agreement to sell a parcel of real estate. A, as attorney for X, actively participated in the negotiations leading to the agreement, drafted the agreement, and was a witness to its execution. The sale did not take place, and in 1972 X sold the property to another purchaser. A again was actively involved in the negotiations leading to the sale. Then a controversy arose among the parties to the original agreement as to their rights and obligations under it, including rights to an escrow deposit, and A commenced a suit for declaratory judgment on behalf of X to resolve the controversy. Pleadings were filed and pretrial discovery commenced. During pretrial discovery proceedings A learned that X, because of a mental condition previously unknown to A, would be unable to testify effectively as a witness in the case. A then decided that he would have to be a witness for X in the case. He withdrew from the case and asked D, another lawyer in the firm of B & C, to represent X as trial counsel in the case. D inquires whether he properly may do so in the circumstances. Opposing counsel have no objection to his doing so. D indicates that his firm will assume the costs incident to his becoming familiar with the case. (We take this to mean that B & C will make no charge to X for the time which D spends in becoming familiar with the matter.)

Discussion: We have not been informed as to the issues presented in the pending action, but we observe that, in view of A's active participation in the underlying transactions, A might have recognized at the outset that he "ought to be called as a witness" in the case, even if X were available to testify. If so, A probably should have declined to represent X in the litigation. See Disciplinary Rule DR 5-101(B). However, we will assume for purposes of this discussion that A had no reason to view himself as a potential witness in the case until he learned of X's mental condition during the course of the discovery proceedings.
Having undertaken employment in the pending litigation, and then having learned that he ought to be called as a witness on behalf of his client, A (and his firm) must withdraw from participation in trial of the case unless one or more of the exceptions set forth in Disciplinary Rule DR 5-101(B) is applicable. See our Opinion No. 74-2.
It does not appear that A's testimony will relate to an uncontested matter, or a matter of formality, or the nature or value of legal services rendered to his client. Therefore the only exception which can apply is if withdrawal from trial of the case "would work a substantial hardship on the client because of the distinctive value of the lawyer or his firm as counsel in the particular case." Disciplinary Rule DR 5-101(B)(4).
The question of hardship withdrawal has been the subject of much discussion. In 1969 the Los Angeles Bar Association Legal Ethics Committee in a well-reasoned opinion, No. 312, concluded that former Canon 19
should not be construed to prevent the participation of a lawyer as a witness and his partner as trial counsel in a matter where: (1) the partners have represented the client for a period of time previous to the litigation; and (2) the lawyer's testimony relates to the matters occurring in the course of his professional duties and is in support of the client's position; and (3) the lawyer's intimate familiarity with the details of the litigation make it important to the client to have the benefit of proposed services of the firm as well as the attorney's testimony; and (4) opposing counsel and the trial court are advised as to the status of the partner as a witness. To hold otherwise may work a substantial injustice upon the client. Indeed to deprive the client of the services of the firm that has a unique knowledge of the facts and law of one particular case may be to the substantial prejudice of the client ... .
Similar conclusions were reached with respect to a will contest in our opinion 74-2, 59 MLQ 88, and in ABA Opinion 220. Compare Supreme Judicial Court Rule 2:24.
A's value to his client's case as a witness cannot be deemed equivalent to "distinctive value of ... his firm as counsel" in the case. A will be available to testity as a witness for X, whether or not a lawyer in the firm of B & C tries the case.
If the pending case were an unusually complex matter (such as a patent infringement case involving sophisticated technical matters or a complex antitrust case) and had been pending for an extended period of time, then the expense and inefficiency of having new trial counsel become familiar with the case might well mean that original trial counsel (and his firm, if other lawyers in the firm had become familiar with the case) would be of "distinctive value ... as counsel in the particular case," and thus within the exception provided in DR 5-101(B)(4).
However, as the problem is presented to us, the only possible "distinctive value" of the firm of B & C as counsel in the case lies in the willingness of the firm to absorb the expense of having D become familiar with the pending case--a reasonable decision in the circumstances, where the problem arose through no fault of the client and quite possibly because of an error in judgment on the part of A in undertaking the litigation.
We are not able to state with certainty whether or not the expense which X may have to incur in order to have new trial counsel (other than D or another lawyer in the firm of B & C) become familiar with the case will constitute "substantial hardship on the client" in this particular case. The pending action, as described to us, appears to be a relatively simple case, such that new trial counsel could become familiar with it without unusual difficulty or extensive expenditure of time; but whether or not there will be substantial hardship on the client must depend in part upon the personal financial situation of the client, as to which we have been given no information.
Assuming that the pending case presents no unusually complex issues, and assuming further that the client is able to pay the expenses of having new trial counsel become familiar with the case without substantial personal financial hardship, we believe that D should not accept employment as trial counsel in the case.
We observe in passing that the firm of B & C still may be of "distinctive value ... as counsel in the particular case," thus falling within the provision of DR 5-101(B)(4), if the mental condition of X is such that he could not deal effectively with new trial counsel from outside the firm, or if the mental condition of X is such that the case will present unusual problems of waiver of privileges applicable to confidential attorney-client communications made between X and A during the course of the original transactions. The information provided to us with respect to the mental condition of X is not sufficient to enable us to express an opinion upon these aspects of the matter, but we suggest that D might take them into consideration.
We do not believe that assent of opposing counsel or parties can relieve a lawyer from his obligation to comply with the requirements of Disciplinary Rules DR 5-101 and DR 5-102.