ML19345G494
| ML19345G494 | |
| Person / Time | |
|---|---|
| Site: | Allens Creek File:Houston Lighting and Power Company icon.png |
| Issue date: | 03/30/1981 |
| From: | Newman J HOUSTON LIGHTING & POWER CO., LOWENSTEIN, NEWMAN, REIS, AXELRAD & TOLL |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| NUDOCS 8104070380 | |
| Download: ML19345G494 (15) | |
Text
.
March 30, 1981
[@DL. ?'\.
- 4 UNITED STATES OF AMERICA
[/ :c:- - .f M NUCLEAR REGULATORY COMMISSION /P3 2193) > {d BEFORE THE ATOMIC SAFETY AND LICENSING BOARD f
'N ,Q /
In'the Matter of ) ; iy' h'
HOUSTON LIGHTING & POWER COMPANY ) Docket No. 5 ,
) p/ s 'N (Allens Creek Nuclear Generating ) A '< * ,
Station, Unit 1) ) (A., )
- -~U ..
&4 App' U 0 l93 s .
- s-t u,:, % 4 .1lp Q
APPLICANT'S BRIEF ADDRESSING THE NEED TO f,,
'A
% ,Q, g c t. ,
DISQUALIFY TEXPIRG'S COUNSEL PURSUANT TO DISCIPLINARY RULES C,'/',
5-101 and 5-lh M>,},'u I. Introduction On March 6, 1981, TexPirg announced through intervenor Doherty that Mr. Scott, TexPirg's counsel, intends to appear as an expert witness on several of TexPirg's, and one of Mr. Doherty's, contentions to be litigated in the health and safety phase of this proceeding. (Tr. 8817). This representation was reaffirmed by Mr. Scott on March 16, 1981, at which. time the Board ordered l Mr. Scott to submit a brief explaining why he should not be t
required to withdraw as an attorney for TexPirg in light of his
. intention'to appear as a witness. (Tr.-8870). The Board also directed Mr. Scott to provide an affidavit from the responsible l
l.
officers or directors of TexPirg identifying the welves; stating how-long they have been officers of TexPirg; that they are in
-fact employing Mr. Scott as-counsel and want him to continue
.- i n that role even if he appears as a witness; and whether Mr. Scott's withdrawal'as counsel would work a substantial So9
& 81e4o70 p Sh.
hardship on TexPirg. (Tr. 8871). That a#fidavit /was servr.d on Applicant on March 23, 1981, without any accompanying brief.
TexPirg has failed to show any valid reason why Mr. Scott should not be required to withdraw as counsel for TexPirg.
Indeed, Mr. Scott has not provided the Board and parties with any legal argument to support his position.- / Accordingly, Applicant moves to disqualify Mr. Scott from any further parti-cipation in this proceeding as an attorney on behalf of TexPirg.
II. Motion for Disqualification A. The Disqualification Rule An NRC Licensing Board has the same authority as a Federal Court to take disciplinary action against attorneys for improper professional conduct. Toledo Edison Co., et al. (Davis-Besse Nuclear Power Station, Units 1, 2 and 3), ALAB-332, 3 NRC 785, 795 (1976). That case makes_ clear that in addressing the question of whether an attorney has engaged in improper.
conduct, the NRC will be guided by the Disciplinary Rules of the American.Bar Association's Code of Professional Responsibility.
Applicant believes that the Disciplinary Rules are quite specific-in precluding Mr. Sectt's dual function as an
-*/ As discussed below, the affidavit did not contain all l of the information which TexPirg was directed to provide.
--**/ In light of the failure to file a brief, Applicant believes that TexPirg has waived its right to submit legal argument in support of.its position. Applicant would strenuously object to any attempt by TexPirg to circumvent the Board's ruling by filing a subsequent brief in support of its position.
attorney and an exp. . witness for TexPirg. The pertinent rule is D.R. 5-102 which provides as follows:
If, after undertaking employment in con-templated or pending litigation, a lawyer learns or it is obvious that he or a lawyer in his firm ought to be called as a witness on behalf of his client, he shall withdraw from the conduct of the trial and his firm, if any, shall not continue representation in the trial, except that he may continue the
. representation and he or a lawyer in his firm may testify in the circumstances enumerated in D.R. 5-101 (B) (1) through (4).
The four exceptions referred to in D.R. 5-102, are as follows:
- 1. if the testimony will relate solely to an un-contested matter;
- 2. if the testimony will relate solely to a matter of formality and there is no reason to believe that substantial evidence will be offered in opposition to the testimony;
- 3. if the testimony will relate solely to the nature and value of legal services rendered in the case by the lawyer or his firm to the client; and
- 4. as to any matter, if refusal would work a sub-stantial hardship on the client because of the distinctive value of the lawyer or his firm as counsel in the particular case.
l Clearly, Exceptions 1, 2 and 3 have no application I
l to this case. The subject of the proposed testimony relates to contested matters, is substantive evidence to be offere.
in opposition to Applicant's testimony, and does not relate solely to the value of legal services rendered by Mr. Scott to his client. This leaves only the question of whether suspension of Mr. Scott would work a substantial hardship
on TexPirg because of his distinctive valde in this particular case. Mr. Scott carries the burden of proving his distinctive value to his client. Supreme Beef Processors, Inc. v. American Consumers Industries, Inc., 441 F.Supp. 1064, 1068 (N.D. Tex.
1977). In Applicant's view, Mr. Scott has not begun'to meet this burden and, indeed, he clearly cannot do so.
B. The Purpose of The Rule Is To Protect The Legal Profession And The Adjudicatory Process The TexPirg affidavit appears to be based on a serious misunderstanding of the Disciplinary Rules. The affidavit states that TexPirg wants Mr. Scott to remain as both its attorney and witness even though "the purpose of DR 5-102 is to protect TexPirg." dowever, the policy underlying DR 5-102 is the preservation of the integrity of the legal profession and the adjudicatory process; thus Mr. Scott has apparently incorrectly advised his client. /
Applicable law indicates that the rule is based, in part, on the concern that an attorney may distort the truth for the sake of his client. In International Electronics Corp. v.
Flan:er, 527 F.2d 1288 (2d Cir. 1975), the Court stated:
... in searching for the rationale of the Rule, we must consider the ethical con-sideration which underlies.it. The arguments
- / Mr. Scott stated this same misconception on March 16 and was challenged by Applicant's counsel. The Board suggested that this issue could be explored by the parties in their written briefs.
_.._-_.________m . _ _ _ . _ . _ _ _ _ . . _ _ _ _ . . . __.._m__ _ _ _ _ _ . _.
for disqualification of the attorney from acting as trial counsel when he, himself, is to be a material witness have been variously stated. See 6 Wigmore on Evidence 5.1911 (3d ed. 1940). The ultimate justifi-cation for the disqualification rule, in Wigmore's view, was that the public might think that the lawyer is distorting the truth for the sake of his client. Another argument for disqualification is that the lawyer-witness will vouch for his own credibility in summing up to the jury - a powerful means of support for his own credibility. The argument that such tactic is to the detriment of his client obviously defeats itself. But the argument that it is unfair to the opponent has some merit. It is difficult, indeed, to cross-examine a witness who d' also an adversary counsel concerning matters of fact, and, more particularly, on matters impeaching his credi-bility, within the bounds of propriety and courtesy owed to professional colleagues.
Id. at 1294. (Emphasis added.) Similarly,it has been stated that the rule is founded upon the preservation of the attorney's unique role as an independent advocate. This view is described in the American Bar Foundation's Annotated Code of Professional Responsibility (American Bar Foundation, 1979), which states:
Finally, it is argued, because the two roles are inconsistent (the advocate is partisan; the witness is detached), the attorney's performance sf each will suffer . . . One commentator has concluded that the essential underlying rationale for the rule is less a ,
concern for the client's interests than for the preservation of the attorney's unique role as an independent and objective proponent of rational argument; the purpose of the rule is preserve the distinction between advocacy, whien is based on reason and is subject to objective evaluation, and testimony, which is based on the witness's moral qualities and is evaluated in terms of individual credibility.
Therefore, client consent is irrelevant and is properly omitted from the Code.
Id. at 214. (Emphasis added.)
In sum, the disqualification rule is not designed to protect the client :nd, therefore, it cannot be waived by the client. Supreme Beef Processors v. American Consumer Industries, supra, 411 F. Supp.
at 1068 (citing Draganescu v. First Natl. Bank of Hollywood, 502 F.2d 550, 552 (5th Cir. 1974).) The rule is designed to pro-tect the integrity of the profession and the legal process, and as stated by the American Bar Foundation, " client consent is irrelevant."
C. Financial Hardship Is Not Substantial Hardship TexPirg's affidavit states that it should be permitted to retain Mr. Scott as both an attorney and a witness because it cannot afford to hire any witnesses. The law is clear that an." allegation of pecuniary hardship alone is insufficient to avoid disqualification, because financial hardship is not synony-mous with substantial hardship." Grossman v. Commercial Capital Corporation, 399 N.L.S.2d 16, 17 (Sup. Ct. App. Div. 197 7) ; see also, Gasoline Expwy, Inc. v. Sun Oil Co. of Pennsylvania, 407 N.Y.S.2d-64, 65 (Sup. Ct. App. Div. 1978).
D. Substantial Hardship Is To Be Narrowly Construed The Code of Professional Responsibility makes clear that only in an " exceptional situation" may a lawyer act as-both attorney and witness, (EC 5-10) and that all doubts should be resolved against the lawyer continuing as an advocate. ' ( Id,. ) In Supreme Beef Processors, Inc. v. American Consumers Industries, Inc.,
supra, 441 F.Supp. at 1068, theLCourt ruled that the hardship
exception contemplates only an attorney who has expertise in a specialized field of law such as patent law, that this distinctive value must be apparent before the decision to accept legal employment is made, and that accordingly, "the rule is to be very narrowly construed." Also, it is the attorney's value as an advocate - not as a witness - which is controlling in making the determination called for by the Code.
TexPirg implies that Mr. Scott's distinctive value derives from the fact that he is the only person who will appear as both
, an attorney and a witness. TexPirg appears to admit that Mr.
Scott's distinctive value is as a witness rather than an attorney, since the affidavit alleges that he is the only available individual with sufficient knowledge to support TexPirg's
/
health and safety contentions.
- / Mr. Scott would appear to be in much the same position as the attorney in Norman Norell, Inc. v. Federal Department Stores, 450 F.Supp. 127-(S.D.N.Y. 1978). After finding that the attorney ought to be called as a witness, the District Court stated:
... Manning states that he and his firm have been acting since 1974 without compensa-tion in order to husband the assets of the I
Norell estate; that they will be compensated in this suit only if victorious; that to find other counsel experienced in dress-business litigation to oppose on a contingent fee basis the ' powerful' defendant would
'probably be impossible' . . . Manning offers no support for the proposition that only counsel experienced in 'the dress business' would be competent to handle this litigation, nor has he stat'ed why another firm could not be retained on a contingency basis. Moreover,
- the ' distinctive' value' of the Manning firm to Norell would appear not to be as counsel but as witness, the very role barred by DR'5-102.
[d. at 130.
E. Familiarity With Proceeding Is Not Distinctive Value TexPirg also argues that withdrawal would cause a sub-stantial hardship for TexPirg because of the time and resources expended by Mr. Scott in preparing for this case. This argument has been rejected consistently by the courts as proof of hardship. See, Draganescu v. First Nat'l. Bank, 502 F.2d 550, 552 (5th Cir. 1974), cert. denied, 421 U.S. 929 (1975)
(long-term familiarity with clients insufficient to invoke exception); United States ex rel. Sheldon Electric Co. v.
Blackhawk Heating & Plumbing, Inc., 423 F.Supp. 486, 490 (S.D.N.Y. 1976) (ten-year relationship with client insufficient to show distinctive value of attorney or firm); Universal Athletic Sales Co. v. American Gym, Recreational and Athletic E3,uipment Cor po ra t ion , Inc., 546 F.2d 530 (3d Cir. 1976). /
The Universal Athletic case is particularly instructive here because it involved a situation where-the attorney in question appeared as an expert witness on behalf of his firm's
client. The Third Circuit ruled that "the disciplinary rules logically apply to expert as well as lay witnesses" and concluded that the law firm should have either withdrawn l once it decided that one of its lawyers would testify as an i
expert witness or should have found another expert. (Id. at 538.)
- / One court has stated that there may be a hardship to a
- client where the trial counsel has also been corporate counsel of long-standing and where the firm was initially retained in an effort to head off a court battle. See Greenebaum-Mountain Mortgage Co. v. Pioneer National Title Insurance Co., 421 F.Supp. 1348 (D. Col. 1976).
That situation, of course, does not obtain here.
The trial court had accepted the argument'that withdrawal would cause a " substantial hardship" to the client because of the time end resources spent in preparing for the trial.
However, the Court of Appeals for the Third Circuit indicated that an investment of time and resources does not equate with
" distinctive value":
Because the action was tried below without a jury, the trial judge could have adjourned the proceedings, without prejudice to the parties or a waste of court resources, until defendants selected another expert or, if they still desired the testimony of Mr. Lyle, another law firm. There is nothing in the record which indicates that the law firm with which Mr. Lyle was associated has such dis-tinctive value.in this litigation as to call DR 5-101(B) (4) into play.
Id. at 538-9, n. 21.
In considering TexPirg's argument the Board should also censider the timeliness with which the Board and parties were notified of Mr. Scott's plans to be a witness. See Miller l
Electric Construction, Inc. v. Devine Lighting Company, Inc.,
I 421 F.Supp. 1020, 1023 ('W.D. Pa. 1976). Much of the hardship alleged here has been created by Mr. Scott's having waited until he was deeply involved'in the case before announcing his decision to be a witness. The disqualification rale should not be l " circumvented by an attorney remaining mute in the face of the l
l rule,'all the while hoping that-his adversary would not recognize the problem until the case were well under way." Greenebaum-Mountain Mortgage Co. v. Pioneer National Title Insurance Co.,
supra', 421 F.Supp. at 1352.
i
F. The Facts Do Not Support Allegations-of Hardship or Distinctive Value For obvious reasons, the distinctive value of an attorney's services, and the hardship to the client that may result from his disqualification, can only be analyzed in light of the facts of a particular case. In this case, the f' acts establish the weakness of TexPirg's assertion that it will suffer hardship from the loss of its counsel's distinctive services.
(1) Distinctive Value on prior occasions reference has been made to the numerous instances in which counsel for TexPirg has abused his right of cross-examinatio.. on behalf of his client, and to the prejudice incurred as a result of counsel's failure to attend the evidentiary hearings. / Mr. Scott's attendance in this proceeding has been sporadic and, by his own admission, will continue to be so.
(Tr. 6172). He has failed to appear on several occasions in which Applicant or Staff witnesses addressing TexPirg's own contentions were on the stand.. The record further reflects his failure to appear at sessions at which his own witness was being cross-examined. (Tr. 4497-98, Tr. 4511-13, Tr. 4556-58, Tr. 4616-19).
- / " Applicant's Response to TexPirg's Motion for Reconsideration of Various Rulings During Evidentiary Hearings, and for Certification of Various Issues to the Appeal Board" (March 4, 1981), p. 4.
The Board has admonished him for his' unprofessional conduct (Tr. 6303, Tr. 7637), for his failure to adhere to rulings of the Board, (Tr. 9483-84) and for wasting the time of all the parties by appearing unprepared for cross-examination and burdening the record with orofitless questions. (Tr. 6298, Tr. 9476).
In addressing the " distinctive value" issue, the Board should also weigh the manner.in which Mr. Scott has treated the issue of his potential disqualification now before the Board. On March 16, the Board directed Mr. Scott to prepare and submit a brief in support of his assertion of the right to appear as both attorney and witness in this proceeding. Having failed to adhere to the Board's directive, he has greatly impaired TexPirg's ability, if any, to meet its burden of showing that this situation falls within the bardship exception of 5-101(B) (4) . In light of this cattern of conduct, Applicant believes that any claim by TexPirg that Mr. Scott's services are of " distinctive value" has little merit.
(2) Hardship The facts in this case also fail to support assertions that.TexPirg will suffer substantial hardship if Mr. Scott must withdraw as counsel. On March 16, Applicant attempted to adduce for the record the nature of'TexPirg's involvement in this proceeding 'and the extent of Mr. Scott's communications with his client'regarding his decision to appear as a
witness. / The Board directed Mr. Scott.to obtain an affidavit to clear up existing doubts about the interests of his client, and so that the Board could determine whether the " substantial hardship" exception might be satisfied. The affidavit filed on March 23, obviously does not resolve those doubts, for it fails to provide important information specifically requested by the Board (i.e., the duration in office of the current directors; the procedures by which the organization chose to use Mr. Scott as a witness).- / TexPirg has failed to carry its burden of showing that it will suffer " substantial hardship" if Mr. Scott is disqualified as an attorney.
- / Mr. Scott admitted that he did not know the names of TexPirg's current officers. (Tr. 8841). Only after Mr. Doherty orovided the name of a current TexPirg officer did Mr.
Scott remember that he had " met with Jeff Hutton several times and have had ten or fifteen conversations over the telephone . . . since he's become President." (Tr. 8841-60). Neither Mr. Scott nor Mr. Doherty appeared to know Mr. Hunt, TexPirg's statewide President.
-~**/
The record simply does not reflect that there exist individual TexPirg members who are actively involved in this proceeding, who participate in the myriad tactical decisions which must be made during a complex hearing, who support Mr. Scott's selective attendance and choice of witnesses, and who are aware of the Board's expressed concerns regarding the quality-of Mr. Scott's appearances before this Board. If no such individuals exist, the statements in the affidavit of Messrs. Hunt and Hutton
.to the effect that TexPirg will suffer hardship would have little validity because the affiants would have no ,
basis for-their statements regarding Mr. Scott's vlaue k as counsel for TexPirg.
13 -
Conclusion For all of the foregoing reasons, Mr. Scott having chosen to appear as a witness should be barred from further participation as an attorney in this proceeding.
Respectfully submitted, PW OF COUNSEL: (
ack R. Newman LOWENSTEIN, NEWMAN, REIS & Robert H. Culp AXELRAD David B. Raskin 1025 Connecticut Ave., N.W. 1025 Connecticut Ave., N.W.
Washington, D.C. 20036 Washington, D.C. 20036 BAKER & BOTTS J. Gregory Copeland 3000 One Shell Plaza C. Thomas Biddle, Jr.
Houston, Texas 77002 3000 One Shell Plaza Houston, Texas 77002 ATTORNEYS FOR APPLICANT HOUSTON LIGHTING & POWER COMPANY
~
UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )
)
HOUSTON LIGHTING & POWER COMPANY ) Docket No. 50-466,
)
(Allens Creek Nuclear Generating )
Station, Unit 1) )
( )
CERTIFICATE OF SERVICE I hereby certify that copies of APPLICANT'S BRIEF ADDRESSING THE NEED TO DISQUALIFY TEXPIRG'S COUNSEL PURSUANT TO DISCIPLINARY RULES 5-101 and 5-102 were served on the following by deposit in the United States mail, postage prepaid, this 30th day of March, 1981:
Sheldon J. Wolfe, Esq., Chairman Susan Plettman, Esq.
Atomic Safety and Licensing David Preister, Esq.
Board Panel Texas Attorney General's Office U.S. Nuclear Regulatory Commission P. O. Box 12548 Washington, DC 20555 Capitol Station Austin, Texas 78711 Dr. E. Leonard Cheatum I Route 3, Box 350A Watkia1ville, Georgia 30677 Hon. Charles J. Dusek l
Mayor, City of Wallis Mr. Gustave A. Linenberger P. O. Box 312 Wallis, Texas 77485 Atomic Safety and Licensing
- ** Hon. Leroy H. Grebe l
U.S. Nuclear Regulatory Commission Washington, DC 20555 County Judge, Austin County P. O. Box 99 Bellville, Texas 77418 Chase R. Stephens Docketing and Service Section l Office of the Secretary of Atomic Safety and Licensing the Commission Board Panel ,
U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, DC 20555 Washington, DC 20555 l
l Atomic Safety and Licensing l Appeal Board U.S. Nuclear Regulatory Commission Washington, DC 20555 l
l l
i
1 i
^
l 1
l James M. Scott, Jr.
Richard Slack, Esq. 13935 Ivy Mount U.S. Nuclear Regulatory Sugar La..a, Texas 77478 Commission Washington, DC 20555 William Schuessler 5810 Darnell John F. Doherty Houston, Texas 77074 4 327 Alconbury Street Houston, Texas 77021 Stephen A. Doggett, Esq.
P. O. Box 592 '
Rosenberg, Texas 77471 Att: Clarence. Johnson Bryan L. Baker Executive Director 1923 Hawthorne Box 237 U.S. Houston, Texas 77098 University of Houston Houston, Texas 7704 J. Morgan Bishop Margaret Bishop Carro Hinderstein 11418 Oak Spring 609 Fannin Street Houston, Texas 77043 Suite 521 Houston, Texas 77002 W. Matthew Perrenod 4070 Merrick D. Marrack Houston, Texas 77024 420 Mulberry Lane Bellaire, Texas 77401 Brenda McCorkle 6140 Darnell Houston, Texas 77074 F. H. Potthoff, III 1814 Pine Village Houston, Texas 77080 Wayne E. Rentfro P. O. Box 1335 Rosenberg, Texas 77471 b
~
/ l
.