New York State Court of Claims

New York State Court of Claims

ORTIZ v. THE STATE OF NEW YORK and NEW YORK STATE THRUWAY AUTHORITY, #2006-030-568, Claim No. 110267, Motion No. M-71632


Synopsis



Case Information

UID:
2006-030-568
Claimant(s):
JOHN ORTIZ and MARIANN ORTIZ
Claimant short name:
ORTIZ
Footnote (claimant name) :

Defendant(s):
THE STATE OF NEW YORK and NEW YORK STATE THRUWAY AUTHORITY
Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
110267
Motion number(s):
M-71632
Cross-motion number(s):

Judge:
THOMAS H. SCUCCIMARRA
Claimant’s attorney:
CALANO & CULHANE, LLPBY: THOMAS A. CULHANE, ESQ.
Defendant’s attorney:
HON. ELIOT SPITZER, NEW YORK STATE ATTORNEY GENERAL
BY: GWENDOLYN HATCHER, ASSISTANT ATTORNEY GENERAL
FABIANI COHEN & HALL, LLP OF COUNSEL
BY: STEPHEN M. COHEN, ESQ.
Third-party defendant’s attorney:

Signature date:
September 1, 2006
City:
White Plains
Comments:

Official citation:

Appellate results:

See also (multicaptioned case)



Decision

The following papers, numbered 1 to 5, were read and considered on Counsel for Defendants’ application, brought by Order to Show Cause, to be relieved as Counsel for Defendants:
1,2 Order to Show Cause, Affirmation by Stephen M. Cohen Esq. of Fabiani Cohen and Hall, LLP, Counsel for Defendants dated March 29, 2006

  1. Affirmation in Opposition by Gwendolyn Hatcher, Assistant Attorney General, dated June 15, 2006 and attached exhibits
  1. Reply Affirmation by Stephen M. Cohen Esq. of Fabiani Cohen and Hall, LLP, Counsel for Defendants
  1. Filed papers: Claim, Answer[1]
After carefully considering the papers submitted and the pertinent law the application is disposed of as follows:

Fabiani Cohen & Hall, LLP, Counsel for the Defendants, asks to be relieved as Counsel pursuant to Civil Practice Law and Rules §321, based upon what may become an adversarial relationship with a long standing client, Columbus Construction Corp., the company contractually obligated to appear and defend the State of New York and the New York State Thruway Authority relative to this Labor Law claim. Counsel had been substituted as counsel for defendants by a Substitution of Attorney form filed on November 9, 2005. The alleged adversity stems from failure on the part of Columbus to pay attorney’s fees in this and in other cases presently pending in the Court of Claims and in the State Supreme Court.

The Assistant Attorney General’s Affirmation in Opposition confirms that there is an ongoing fee dispute between Fabiani Cohen & Hall, LLP and Columbus, and attaches a letter that it directed to Columbus on June 1, 2006 reminding the company of its continued obligation to appear and defend the State of New York and the New York State Thruway Authority. [Affirmation in Opposition by Gwendolyn Hatcher, Assistant Attorney General, Exhibit 5]. She also argues, however, that non-payment of fees alone is insufficient to entitle an attorney to withdraw from representation.

There must be a showing of good cause and reasonable notice before an attorney will be permitted to terminate the attorney-client relationship. See e.g. J.M. Heinike Associates, Inc. v Liberty Nat. Bank, 142 AD2d 929 (4th Dept 1988). What constitutes good cause is not an objective determination, but rather lies within the sound discretion of the trial court. See e.g. People v Salquerro, 107 Misc 2d 155 (Sup Ct, NY County, 1980).

Permissive withdrawal is authorized when the client: “Deliberately disregards an agreement or obligation to the lawyer as to expenses or fees.” Code of Professional Responsibility DR 2- 110(C)(1)(f); see also 22 NYCRR §1200.15 (c)(1)(vi). By the same turn, however, it is well settled that nonpayment of counsel fees alone does not entitle an attorney to withdraw from representing a client. See generally Cashdan v Cashdan, 243 AD2d 598 (2d Dept 1997); George v George, 217 AD2d 913 (4th Dept 1995); cf. Tartaglione v Tiffany, 280 AD2d 543 (2d Dept 2001). Indeed, in a case where discovery had been completed and a note of issue had been filed, the Court would not permit the attorneys for a defendant to withdraw because it

“. . . would further delay the resolution of . . . [the] action . . . (citations omitted) and would not promote judicial economy.” George v George, supra, at 913; see also Torres v Torres, 169 AD2d 829 (2d Dept 1991).[2] The consideration still is whether the client’s conduct has rendered it unreasonably difficult for counsel to carry out its obligation of effective representation. DR2-110 (C) (1)(d); see also 22 NYCRR §1200.15 (c)(1)(iv).

What is pertinent here, however, is that the entities for which Counsel has filed an appearance in the Court of Claims are the State of New York and the New York State Thruway Authority, not Columbus.

As noted by the Assistant Attorney General, it is Columbus, the construction contractor herein, who owes the defense to the State of New York and the Thruway Authority pursuant to its contract. [Affirmation in Opposition by Gwendolyn Hatcher, Assistant Attorney General, Exhibit 1]. Coverage has not been disclaimed. Indeed the Attorney General’s Office, otherwise charged statutorily with the duty to defend the State of New York, was provided with notice that York Claims Service, the authorized claims representative on behalf of Columbus Construction Corp., had agreed to defend the State and to indemnify it up to a given self-insured retention dollar amount. [ibid. Exhibit 2]. Excess coverage was to be provided by Arch Insurance Company, Columbus’ general insurance carrier. [id.]. No insurance company has been declared insolvent.[3] If coverage issues develop, a declaratory judgment action is the appropriate vehicle for resolving the matter. Similarly, a dispute concerning fees that is completely ancillary to the claim before this Court, does not establish that Counsel cannot represent the entities it has appeared for: the State of New York and the New York State Thruway Authority. There is no indication that Counsel has sought compensation from other sources. See Cullen v Olins Leasing, Inc., supra.

In view of the foregoing, the Court finds that there has not been a showing of good cause to be relieved. Accordingly, Counsel for the Defendants’ application (M-71632), brought by Order to Show Cause is in all respects denied.

September 1, 2006
White Plains, New York

HON. THOMAS H. SCUCCIMARRA
Judge of the Court of Claims




[1]. The Court notes that Counsel of record filed a copy of an Order entered in an action pending in New York County Supreme Court, entitled Benjamin Frederick v New York City DOT, the City of New York and Columbus Construction Corp., Index No. 101268/06; purporting to stay “all actions in which there is a fee dispute between Fabiani, Cohen & Hall and Columbus Construction Corp., . . . until July 14, 2006 at which time the court will conduct a fee hearing . . .” Even if such a stay applied to this Court, it expired by its terms.
[2]. Counsel’s attempt to withdraw as counsel on the eve of a contempt adjudication based upon information imparted by his client purportedly violative of the Code of Professional Responsibility denied. The trial court’s exercise of discretion affirmed on appeal, because for the trial court to have ruled “. . . otherwise would allow the defendant to manipulate the pace of the litigation to his liking in this manner . . . (citation omitted).
[3]. Cullen v Olins Leasing, Inc., 91 AD2d 537 (1st Dept 1982) The defense attorneys had been retained by an insurer subsequently found to be insolvent, and were allowed to withdraw from representing the insured when the insured would not assume responsibility for payment of counsel’s fees.