Opinion
F054395.
2-20-2009
RICHARD DIXON, Defendant and Appellant, v. CHEVRON U.S.A., INC., Plaintiff and Respondent.
Darling & Wilson and Joshua G. Wilson; Dake, Braun & Monje and Craig N. Braun for Defendant and Appellant. Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, William A. Bruce, Kenneth A. Holland and Catherine E. Bennett for Plaintiff and Respondent.
Not to be Published in the Official Reports
Appellant Richard Dixon (Dixon) appeals from the trial courts denial of his motion to disqualify attorney William Bruce (Bruce) from representing Chevron U.S.A., Inc. (Chevron) in Chevrons lawsuit against Dixon. Dixon was a consultant for Chevron who arranged the sale of certain of Chevrons real properties. In a prior litigation between third parties, Dixon testified at a deposition as Chevrons "Person Most Knowledgeable" (PMK) regarding a real property transaction. Bruce represented Chevron at that deposition. Months after the conclusion of the deposition, Chevron filed the present lawsuit against Dixon alleging that he defrauded Chevron and concealed the true nature of his contractual relationship with a major purchaser of Chevron real properties. Dixon responded by filing a motion to disqualify Bruce (and Bruces law firm) on the grounds that Bruce formerly represented Dixon in the PMK deposition and that the present lawsuit was substantially related to that former representation. The trial court denied the motion, finding there was no prior attorney-client relationship and no confidential information was communicated. On appeal, Dixon contends the trial court abused its discretion. We will affirm.
FACTS AND PROCEDURAL BACKGROUND
The PMK Deposition and the Present Action
Richard Dixon retired from his employment with Chevron in 1999 after 25 years of service. In 2002, he returned to Chevron as a nonexclusive independent contractor in the role of a consultant. His duties as a consultant included identifying and soliciting prospective buyers for Chevrons nonproducing real property and then negotiating the sales on Chevrons behalf.
In 2003, Dixon was approached by SKY Management, LLC (SKY) with an opportunity to be retained as a consultant for SKY. Dixon was interested in the offer, but did not want to do anything to jeopardize his ongoing consulting contract with Chevron. Dixon met with James Talbot, the manager of Chevrons San Joaquin Valley Productions legal department, and Vic Byers, manager of Chevrons California Land Division, and advised them of his opportunity to provide consulting services for SKY. According to Dixon, in the course of these discussions he told Talbot that SKY had purchased properties from Chevron in the past and would likely do so again. Talbot recalled that Dixon promised he would not represent SKY on any current or former Chevron properties. Dixon was later informed by Byers that he was free to pursue the SKY opportunity.
During 2004, Dixon identified a group of nine properties for sale on Chevrons behalf. That same year, Chevron accepted SKYs offer to purchase those properties. That transaction was referred to by the parties as the "`bundle sale." The bundle sale originally included land near the Kern County Airport (the airport property) and two parcels in Santa Barbara County (the Santa Barbara property). The airport property is the subject of the current lawsuit. The Santa Barbara property was removed from the bundle sale and treated separately because Chevron did not hold title, but held a contractual right of reconveyance from an entity known as Rice Ranch Ventures, LLC (Rice Ranch). Chevron ultimately sold its contractual right of reconveyance concerning the Santa Barbara property to LTB Ventures, a SKY affiliate. Dixon brokered the deal on Chevrons behalf.
In 2006, LTB Ventures sued Rice Ranch regarding the Santa Barbara property in a case entitled LTB Ventures, LLC v. McCadden Development, LLC et al. (Super. Ct. Santa Barbara County, 2007, No. 1196371). Neither Chevron nor Dixon was named as a party in that lawsuit. Counsel for Rice Ranch served a deposition subpoena on Chevron, asking that it produce for deposition a designated PMK to testify on Chevrons behalf concerning the 2004 sale of reconveyance rights to LTB Ventures. Ralph Mayo, Chevrons in-house counsel, asked Dixon if he would serve as Chevrons PMK for the deposition. Dixon claims he then asked Mayo if he (Dixon) would be "`protected" by Chevron, to which Mayo allegedly answered, "`yes." Mayo had no recollection of such a request for protection. Dixon agreed to testify as Chevrons PMK with respect to the Santa Barbara property transaction.
On October 23, 2006, Mayo appeared as attorney on behalf of Chevron on the first day of the deposition in which Dixon testified as PMK. Sometime before the deposition began, Dixon informed Mayo that he had done some work for LTB Ventures affiliate, SKY. According to Mayo, Dixon described the nature of his work for SKY as "`insignificant" and said it "`did not involve Chevron properties." Dixon also advised Mayo that he had previously informed Chevron managers Vic Byers and Jim Talbot of his relationship with SKY, and Mayo confirmed this with Byers and Talbot. In preparing him for the deposition, Mayo told Dixon that Chevron was not named as a party and Mayo did not foresee Chevron being dragged into the litigation; therefore, the best approach was for Dixon to freely respond to the questions so that Chevron could get the matter behind it. The deposition did not conclude on October 23, 2006, and the parties agreed to continue the deposition to a convenient future date.
Dixon was not pleased with the manner in which the first day of the deposition was conducted. He felt that Mayo allowed questions to be asked and answered that were beyond the scope of the subjects described in the deposition subpoena. For instance, at one point Dixon was asked how much SKY was paying him for consulting services, and Mayo indicated that Dixon should go ahead and answer the question. Dixon complained to Talbot, suggesting that Talbot should step in and take over the deposition, but Talbot said he had no intention of doing so. As it turned out, Mayo had already concluded that his schedule would not permit him to devote more time to the further deposition sessions, so a decision was made to hire outside counsel.
Chevron retained Bruce, a partner in the law firm of Klein, DeNatale, Goldner, Cooper, Rosenlieb & Kimball, LLP (the KDG law firm) to represent Chevrons interests in the remaining sessions of the PMK deposition. Bruce had been used in the past as outside counsel for Chevron, and Dixon was personally aware of that from his experience at Chevron.
Shortly after the October 23, 2006 deposition session, Dixon was subpoenaed to testify in his individual capacity in the same case. Dixon asked if Chevron would pay for outside counsel to represent Dixons interests as an individual. Mayo and Talbot answered that Chevron would not do so. They reasoned that the basis for Dixons deposition as an individual was undoubtedly related to work that Dixon did as a consultant for SKY and, therefore, Chevron should not be responsible for paying for Dixons individual attorney. Mayo and Talbot recommended that Dixon get his own attorney for his individual deposition. Dixon then hired attorney Daniel Park, who was also representing LTB Ventures in the same litigation.
Meanwhile, in preparation for the continuation of the PMK deposition, Bruce and Dixon met on several occasions to discuss the areas of inquiry concerning which Dixon had been designated as PMK for Chevron. At one or more of these meetings, Dixon advised Bruce of his relationship with SKY and that Byers and Talbot had consented to that relationship. Dixon also told Bruce of his frustration with the way Mayo handled the first session of the deposition, including the fact that Mayo had allowed questions concerning Dixons financial arrangement with SKY. Bruce responded that as Chevrons PMK, he was testifying "as `Chevron" and "not [as] Richard Dixon," and he would attempt to limit the questions to the areas of inquiry, although there would have to be some latitude given. Additionally, Dixon told Bruce of his agitation that Chevron had rejected his request that Chevron defend him in his individual capacity, but Dixon further explained that LTB Ventures, an affiliated company of SKY, had agreed to defend him in his individual capacity. It seemed "perfectly natural" to Bruce that LTB Ventures would bear the expense resulting from Dixon having acted on behalf of SKY.
According to Bruce, during the meetings with Dixon in preparation for the resumption of the PMK deposition, Dixon "did not convey any confidential information to [him] which ever formed the basis of any of the allegations contained in the subject complaint." Dixon "merely reiterated what he had previously testified to under oath, including his business relationship with [SKY]. [Bruce] had been provided a copy of Volume One of Dixons deposition as Chevrons PMK by [Mayo] prior to [his] meeting, so [Bruce] already was aware of [Dixons] dealings with SKY." Bruce denied that he ever gave Dixon legal advice, stating as follows: "At no time during the initial meeting or any other meeting did Dixon ask me for legal advice. Moreover, at no time did I tell [Dixon] that I was representing him personally, nor was there ever a legal services agreement between Dixon and [the KDG law firm], any discussion of one, or any payment of our fees by [Dixon]. Furthermore, at the conclusion of the initial meeting, it was my understanding that [Dixon] was not relying upon me as his attorney since he told me that he had hired [Park] . . . for that purpose in early November of 2006."
Excerpts of the October 23, 2006 session of the PMK deposition (in which Mayo appeared as Chevrons attorney) reflect that counsel for Rice Ranch asked Dixon about his financial arrangement with SKY. Dixon answered that he was paid a fee of $16,000 per month by SKY for consulting services regarding other properties.
There were two additional days of the PMK deposition. These occurred on November 29 and November 30, 2006. On both days, Bruce appeared on behalf of Chevron while Park appeared on behalf of Dixon individually. Thereafter, Dixon was deposed for one day in his individual capacity. Park appeared on behalf of Dixon at that deposition, but no one from Chevron appeared.
Months later, in April of 2007, Chevron allegedly discovered that Dixon had been untruthful about the nature and scope of his relationship with SKY. Dixon originally told Chevron that his work for SKY would not relate to any currently owned Chevron properties. However, not only had Dixon assisted SKY in obtaining various Chevron properties, but his agreement with SKY actually provided that he would receive a share of the profits realized from six of the recently sold Chevron properties negotiated by Dixon on Chevrons behalf for sale to SKY. As a result of these discoveries, Chevron terminated Dixons consulting agreement on April 10, 2007.
On July 13, 2007, Chevron commenced the present action by filing its original complaint against Dixon, SKY and related entities. A first amended complaint was filed by Chevron on August 21, 2007, which was the operative pleading at the time of the disqualification motion. Chevrons allegations therein of fraud and breach of fiduciary duty against Dixon stated that Dixon concealed the full scope of his relationship with SKY, including the fact that he was being paid approximately $200,000 per year plus a profit-sharing arrangement regarding certain recently sold Chevron properties (such as the airport property), all in exchange for Dixons services for SKY that related directly to Chevrons recently sold or currently owned properties. The first amended complaint further alleged that Dixon fraudulently conspired with SKY to have the airport property sold to SKY (or to SKYs related entity, S&J Alfalfa) at substantially below the full market value. Bruce (and the KDG law firm) were and still are representing Chevron in prosecuting the action against Dixon.
Dixons Motion to Disqualify Chevrons Attorney
On October 31, 2007, Dixon filed his motion to disqualify Bruce and the KDG law firm. The motion asserted that disqualification was required on the following grounds: (1) Bruce previously represented Dixon in the PMK deposition in the prior litigation, and that matter was substantially related to the present action; (2) Bruce obtained confidential information from Dixon at that time and should be disqualified whether or not Dixon was a client; and (3) Bruce failed to provide the warning required by the California State Bar Rules of Professional Conduct, rule 3-600(D), as to the identity of Bruces corporate client when it was apparent that Chevrons interests were or may subsequently become adverse to Dixons interests in connection with preparing him for the PMK depositions in the prior action.
All further references to rules are to the Rules of Professional Conduct of the State Bar of California.
Chevron opposed the motion on the grounds that Dixon was never Bruces client, and Dixons disclosures to Bruce were not confidential matters. Following a hearing of the motion on December 3, 2007, the trial court denied the motion. The trial courts order explained as follows:
"The motion to recuse [Bruce], and the firm he is a member of is denied. Clearly this case requires an analysis consistent with the dictates of Responsible Citizens v. Superior Court [(1993) 16 Cal.App.4th 1717]. The Court is also mindful of the ruling in Meehan v. Hopps [(1956) 144 Cal.App.2d 284 (Meehan)]. The relationship between [Dixon] and [Bruce], as it relates to the instan[t] motion, arises from [Bruce] attending with [Dixon] a PMK deposition where Dixon was the designated PMK, and associated meetings. [Dixon] was, at the time, also represented by his personally hired attorney [Park]. [Dixons] (or his current attorneys) position seems to be that he somehow believed that [Bruce] was representing him, and, apparently not Chevron. This position is not credible based on the declarations before the Court. In fact, it appears clear that [Dixon] was not, would not be, personally represented by [Bruce], or any other lawyer hired, and paid for, by Chevron. The declaration of [Bruce] states that no issues or fact which were not disclosed in the subject deposition, as they related to any relevant issue, were ever discussed. [Dixon] claims that confidential facts were discussed[;] however, [he] does not disclose, in camera, or otherwise what [Bruce] `learned which in any [way] would adversely [affect Dixon] in the instant lawsuit. The facts before the Court simply do not provide a basis to find that [Dixon] had any reasonable expectation that [Bruce] was his lawyer, or that anything said would not be passed on to Chevron. This conclusion is reinforced, by [Parks] presen[ce] as [Dixons] attorney." (Italics added.)
Dixon timely appealed from the above order denying his motion to disqualify opposing counsel. He also petitioned for a writ of supersedeas, which we denied.
DISCUSSION
I. Standard of Review
"Generally, a trial courts decision on a disqualification motion is reviewed for abuse of discretion. [Citations.] If the trial court resolved disputed factual issues, the reviewing court should not substitute its judgment for the trial courts express or implied findings supported by substantial evidence. [Citations.] When substantial evidence supports the trial courts factual findings, the appellate court reviews the conclusions based on those findings for abuse of discretion. [Citation.] However, the trial courts discretion is limited by the applicable legal principles. [Citation.] Thus, where there are no material disputed factual issues, the appellate court reviews the trial courts determination as a question of law. [Citation.] In any event, a disqualification motion involves concerns that justify careful review of the trial courts exercise of discretion. [Citation.]" (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) 20 Cal.4th 1135, 1143-1144 (SpeeDee Oil ).)
II. The Trial Court Did Not Abuse its Discretion in Denying the Disqualification Motion
The authority of a trial court "to disqualify an attorney derives from the power inherent in every court `[t]o control in furtherance of justice, the conduct of its ministerial officers." (SpeeDee Oil, supra, 20 Cal.4th at p. 1145.) "Ultimately, disqualification motions involve a conflict between the clients right to counsel of their choice and the need to maintain ethical standards of professional responsibility." (Id. at p. 1145.) "The paramount concern must be to preserve public trust in the scrupulous administration of justice and the integrity of the bar." (Ibid.)
Dixon claims on appeal, as he did in the trial court, that disqualification of opposing counsel (Bruce and the KDG law firm) was required because (1) Bruce previously represented Dixon in the PMK deposition and that former representation had a substantial relationship to the subject matter of the present action; (2) even if Dixon was not a client of Bruce in the PMK deposition, Bruce obtained confidential information from Dixon at that time and should be disqualified; and (3) Bruce failed to provide the warning required by rule 3-600(D), where an attorney represents a corporate client and a corporate employee or agents interests potentially conflict. We now address each of these contentions in turn.
A. Substantial Relationship Test
Dixon first argues that Bruce and the KDG law firm should have been disqualified under the substantial relationship test that is applied in cases of successive representation of clients who have adverse interests. We begin with a brief overview of the law relating to that test.
"When disqualification is sought because of an attorneys successive representation of clients with adverse interests, the trial court must balance the current clients right to the counsel of its choosing against the former clients right to ensure that its confidential information will not be divulged or used by its former counsel." (City and County of San Francisco v. Cobra Solutions, Inc. (2006) 38 Cal.4th 839, 846.) An attorneys duties to his client of both confidentiality and loyalty preclude him from later agreeing to represent an adversary of the attorneys former client unless the former client provides an informed written consent waiving the conflict. (Id. at p. 847.) "If the attorney fails to obtain such consent and undertakes to represent the adversary, the former client may disqualify the attorney by showing a `"substantial relationship" between the subjects of the prior and current representations. [Citation.]" (Ibid.)
In cases where the potential conflict is one that arises from the successive representation of clients with potentially adverse interests, "the courts have recognized that the chief fiduciary value jeopardized is that of client confidentiality." (Flatt v. Superior Court (1994) 9 Cal.4th 275, 283.) Thus, when it is demonstrated that the subjects of the two representations are substantially related, "the need to protect the first clients confidential information requires that the attorney be disqualified from the second representation." (SpeeDee Oil, supra, 20 Cal.4th at p. 1146.)
In Flatt v. Superior Court, supra, 9 Cal.4th at pages 283-284, the Supreme Court further explained the substantial relationship test as follows: "The `substantial relationship test mediates between two interests that are in tension in such a context — the freedom of the subsequent client to counsel of choice, on the one hand, and the interest of the former client in ensuring the permanent confidentiality of matters disclosed to the attorney in the course of the prior representation, on the other. Where the requisite substantial relationship between the subjects of the prior and current representations can be demonstrated, access to confidential information by the attorney in the course of the first representation (relevant by definition to the second representation) is presumed and disqualification of the attorneys representation of the second client is mandatory; indeed, the disqualification extends vicariously to the entire firm. [Citations.]"
As noted, the trial court concluded that disqualification was inappropriate in this case because, among other things, there was no prior attorney-client relationship between Bruce and Dixon. We now address that question.
Attorney-client Relationship
"`Before an attorney may be disqualified from representing a party in litigation because his representation of that party is adverse to the interest of a current or former client, it must first be established that the party seeking the attorneys disqualification was or is "represented" by the attorney in a manner giving rise to an attorney-client relationship. [Citations.]" (Koo v. Rubios Restaurant, Inc. (2003) 109 Cal.App.4th 719, 729.) "The burden is on the party seeking disqualification to establish the attorney-client relationship. [Citation.]" (Ibid.)
"The question of whether an attorney-client relationship exists is one of law. [Citations.] However, when the evidence is conflicting, the factual basis for the determination must be determined before the legal question is addressed. [Citation.]" (Responsible Citizens v. Superior Court, supra, 16 Cal.App.4th at p. 1733.) The trial courts findings, or presumed findings, of the underlying factual issues will be upheld if supported by substantial evidence. (Id. at p. 1734.)
An attorney-client relationship is created "by some form of contract, express or implied, formal or informal." (Fox v. Pollack (1986) 181 Cal.App.3d 954, 959.) "`The distinction between express and implied in fact contracts relates only to the manifestation of assent; both types are based upon the expressed or apparent intention of the parties. [Citation.]" (Responsible Citizens v. Superior Court, supra, 16 Cal.App.4th at pp. 1732-1733.) A persons subjective belief that an attorney-client relationship exists — his "`thought" that the attorney was representing him — is insufficient. (Zenith Ins. Co. v. OConnor (2007) 148 Cal.App.4th 998, 1010; Fox v. Pollack, supra, at p. 959.) "This is because a [person] cannot unilaterally establish an attorney-client relationship, and [his] hindsight `beliefs that such a relationship existed are thus legally irrelevant. [Citation.] Instead, it is the intent and conduct of the parties that control the question as to whether an attorney-client relationship has been created. [Citation.]" (Zenith Ins. Co. v. OConnor, supra, at p. 1010.) "In determining the existence of an attorney-client relationship, we should ask whether the `totality of the circumstances so indicate. [Citation.]" (Koo v. Rubios Restaurants, Inc., supra, 109 Cal.App.4th at p. 732; Responsible Citizens v. Superior Court, supra, at p. 1733.)
Here, the declarations failed to show the existence of an implied-in-fact attorney-client contract between Bruce and Dixon. Dixon understood that Chevron was the one served with a deposition subpoena to provide documents and to designate a PMK for purposes of a deposition. Dixon agreed to serve as Chevrons PMK out of a sense of duty to Chevron. Thus, the deposition was clearly understood to be discovery directed at Chevron as a corporation, not at Dixon individually. The mere fact that Bruce represented Chevron at the deposition did mean that he also represented the individual interests of the designated PMK. Generally speaking, an attorney representing a corporation is not assumed to be also representing the individual interests of those who are the principals of the corporation. "The attorney for a corporation represents it, its stockholders and its officers in their representative capacity. He in nowise represents the officers personally." (Meehan, supra, 144 Cal.App.2d at p. 290, italics added; see also La Jolla Cove Motel and Hotel Apartments, Inc. v. Superior Court (2004) 121 Cal.App.4th 773, 784 ["In representing a corporation, an attorneys client is the corporate entity, not individual shareholders or directors, and the individual shareholders or directors cannot presume that corporate counsel is protecting their interests"]; Responsible Citizens v. Superior Court, supra, 16 Cal.App.4th at pp. 1731-1733 [representation of partnership entity does not, by itself, create an attorney-client relationship with the individual partners].) Although Dixon was not an officer of Chevron, but instead was its agent, the conclusion here is the same. Bruce was clearly the attorney for Chevron the corporation, not Dixon the individual.
The information Dixon provided in connection with the PMK deposition was essentially an account of his activities as an agent on behalf of Chevron in connection with a real property transaction, which he would be duty bound to report to Chevron in any event. (See 3 Witkin, Summary of Cal. Law (10th ed. 2005) Agency and Employment, § 97, p. 144 [an agent as a fiduciary is required to disclose to the principal all information relevant to the subject matter of the agency].) As Meehan further notes: "It would be a sorry state of affairs if when a controversy arises between an attorneys corporate client and one of its officers he could not use on behalf of his client information which that officer was required by reason of his position with the corporation to give to the attorney." (Meehan, supra, 144 Cal.App.2d at p. 290.)
The fact that all parties knew and understood that Bruce was the attorney for Chevron, not Dixon, is confirmed by other circumstances. When a separate subpoena was served on Dixon personally, seeking his testimony in his individual capacity, Chevron specifically refused to provide Dixon an attorney to represent him. Dixon proceeded to hire his own attorney, Park, to protect his individual interests. Park appeared on Dixons behalf at subsequent sessions of the PMK deposition as well as at the individual deposition. Further, when Bruce was first hired by Chevron to oversee the remaining sessions of the PMK deposition, he was specifically introduced to Dixon as Chevrons outside counsel. No arrangement for Dixon to pay attorney fees was ever discussed and Dixon never indicated he was seeking personal legal advice. At the deposition sessions themselves, Bruce announced on the record that he was appearing as Chevrons counsel; while Park stated on the record that he was appearing for Dixon personally. These circumstances clearly indicate there was no implied-in-fact attorney-client contract between Bruce and Dixon (individually) in connection with the PMK deposition.
This event, which occurred prior to Bruces arrival, clearly showed that Chevron did not intend to protect Dixons individual interests even if, as Dixon claims, Mayo previously suggested he would be "`protected."
Dixon attempts to overcome the plain import of these facts by asserting that he divulged confidential information to Bruce in several meetings in preparation for the further sessions of the PMK deposition, and he further asserts that he received personal advice from Bruce. In this regard, Dixon relies on the test for an attorney-client relationship that is applied in preliminary consultation cases: "An attorney represents a client — for purposes of a conflict of interest analysis — when the attorney knowingly obtains material confidential information from the client and renders legal advice or services as a result." (SpeeDee Oil, supra, 20 Cal.4th at p. 1148.) As explained below, the circumstances referred to by Dixon do not substantiate his contentions.
Dixons declarations reflect that his meetings with Bruce in preparation for the PMK deposition included discussions of the bundle sale generally, as well as the Santa Barbara property specifically. Additionally, Dixon discussed with Bruce aspects of his (Dixons) relationship with SKY. Such matters do not appear to be confidential in nature as to Dixons personal interests, but merely provided reasonable background information for purposes of thorough preparation for the PMK deposition. Although Dixons contractual relationship with SKY was not one of the topics identified in the deposition subpoena, Dixon had previously described his work and relationship with SKY in the first session of the PMK deposition when Mayo was attorney for Chevron, and therefore it was reasonable for Bruce to gain an understanding of that subject matter and how it might relate to Chevrons answers (through its PMK) to further questions at the deposition. We conclude that Dixon failed to show directly or by reasonable inference that he divulged confidential information to Bruce. (See Med-Trans Corp., Inc. v. City of California City (2007) 156 Cal.App.4th 655, 668 ["where the former contact with the attorney was a preliminary conversation that did not result in professional employment or services, the party seeking disqualification must show, directly or by reasonable inference, that the attorney acquired confidential information in the conversation"].)
Similarly, Dixons statement to Bruce of disappointment that Mayo had not objected to questions outside the scope of the PMK deposition subpoena, and Bruces comment in response that he would attempt to limit questions to the areas of inquiry, do not demonstrate an exchange of confidential personal information. With respect to the matter of who paid Dixons attorney fees, that information was also not confidential in nature. (Willis v. Superior Court (1980) 112 Cal.App.3d 277, 292 [general rule is that identity of who pays an attorney is not privileged absent special circumstances in which disclosure would be injurious to client].) The fact that Park may have objected at the PMK deposition to a question about who was paying Dixons attorney fees, and that Bruce may have joined in that objection, did not alter its nonconfidentiality.
This conclusion is further supported by Bruces declaration that Dixon "did not convey any confidential information to [him] which ever formed the basis of any of the allegations contained in the subject complaint," but "merely reiterated what he had previously testified to under oath, including his business relationship with [SKY]." Bruces declaration additionally notes that he never gave Dixon legal advice, Dixon never asked for any, and at no time did he tell Dixon that he was representing him personally. Rather, Bruce understood that Dixon was not relying upon Bruce as his attorney since Dixon announced that he had previously hired Park for that very purpose.
The record also fails to support Dixons contention that Bruce gave him personal legal advice or representation. Dixon asserts that Bruce provided personal legal representation when he told Dixon during the PMK deposition that opposing counsel could ask him a particular question "as an individual." Dixon has misconstrued the exchange that occurred at the deposition. Bruce did state that a question could be asked of Dixon as an individual, but also added in an apparent objection that "hes not being produced on this [subject.]" It thus appears Bruce was asserting that the particular question was outside the scope of the PMK deposition while at the same time acknowledging that it could be asked in the context of Dixons deposition in his individual capacity. In other words, Bruce was clarifying and affirming the setting in which the question could be asked — namely, in Dixons deposition in his individual capacity as distinct from the PMK deposition. We do not believe that such an isolated remark, understood in the larger context, could reasonably be understood as indicating that Bruce was actually representing Dixon, particularly when Dixon was personally represented at the deposition by Park.
Dixon contends that Bruce was under the mistaken impression that the individual deposition was combined with the PMK deposition. Even if that is correct, we do not believe that Bruces momentary confusion on that point changes the analysis. He was still, in essence, deflecting the question to the deposition of Dixon in his individual capacity, whenever that was to occur.
Additionally, Dixon claims that Bruce advised him with respect to making changes in the deposition transcript. But since Dixon testified as PMK on behalf of Chevron — that is, it was Chevrons deposition — we fail to see how Bruces brief statements with respect to making any potential corrections to the transcript would reflect that Bruce was representing Dixon individually.
In sum, Dixon failed to show that Bruce represented his individual interests or that confidential information was communicated. As previously discussed, Dixon also failed to show circumstances from which an implied-in-fact attorney-client agreement might reasonably be inferred. We conclude that the trial court correctly ruled there was no prior attorney-client relationship and, accordingly, the trial courts denial of Dixons disqualification motion was not an abuse of discretion.
B. Other Alleged Grounds for Disqualification
Dixon argues that even if Bruce never acted as his personal attorney, the trial court should have granted the disqualification motion. In rare circumstances an attorney may be found to have a conflict of interest even if no prior attorney-client relationship existed with the party seeking disqualification. (Morrison Knudsen Corp. v. Hancock, Rothert & Bunshoft (1999) 69 Cal.App.4th 223, 232-233.) To warrant disqualification in such cases, it must be demonstrated that the attorney was in a special position of trust or fidelity with respect to information about the party seeking disqualification, the information was originally obtained or received under a reasonable expectation of confidentiality, and the subject matter thereof was substantially related to the current lawsuit. (Id. at pp. 231-234.) For example, such a situation might be found to arise where an attorney is on the board of directors of a litigation adversary (see William H. Raley Co. v. Superior Court (1983) 149 Cal.App.3d 1042, 1049), or where an attorney acts as "`monitoring counsel" for the underwriters of a litigation adversarys parent corporation (Morrison Knudsen Corp. v. Hancock, Rothert & Bunshoft, supra, at p. 233). This theory cannot provide a basis for disqualification in the present case. Dixon did not show that he had a reasonable expectation of confidentiality with respect to his individual interests, since Bruce was clearly acting only on behalf of Chevron when he handled the PMK deposition. Moreover, as previously discussed, Dixon did not show that he actually divulged any material confidences concerning his individual legal interests to Dixon.
Finally, Dixon argues in the alternative that the disqualification motion should have been granted because Bruce allegedly failed to give Dixon the warnings required by rule 3-600(D). Rule 3-600(D) addresses itself to the situation in which an organization (e.g., a corporation) is the client, and states as follows:
"In dealing with an organizations directors, officers, employees, members, shareholders, or other constituents, a member shall explain the identity of the client for whom the member acts, whenever it is or becomes apparent that the organizations interests are or may become adverse to those of the constituent(s) with whom the member is dealing. The member shall not mislead such a constituent into believing that the constituent may communicate confidential information to the member in a way that will not be used in the organizations interest if that is or becomes adverse to the constituent."
Dixon failed to demonstrate that disqualification was required under the above rule. He did not present evidence of when Bruce discovered that Chevrons interests were, or reasonably might become, adverse to Dixons. On the other hand, Bruce explained in his declaration that throughout the depositions he believed Chevrons interests were aligned with Dixons and those of LTB Ventures, and that it was not until sometime after April 10, 2007 — months after the depositions concluded — that he discovered the basis for Chevrons claim against Dixon. Thus, there was substantial evidence to support the trial courts denial of the motion and nothing in the record affirmatively demonstrates an abuse of discretion.
DISPOSITION
The order of the trial court is affirmed. Costs on appeal are awarded to Chevron.
WE CONCUR:
Vartabedian, Acting P.J.
Wiseman, J.