Metropolitan News-Enterprise


Monday, April 18, 2016


Page 1


C.A. Bars in Camera Review to See if Privilege Applies




A judge determining a claim of attorney-client privilege cannot review the contents of a communication in order to determine whether the privilege applies, the Fourth District Court of Appeal ruled Friday.

Div. Three reversed Orange Superior Court Judge Linda S. Marks’ order denying a motion to disqualify an attorney accused of improperly obtaining and using a letter and an email that had been sent by opposing counsel to his client. Justice Richard Aronson said Marks erred in denying the motion on the ground the information contained in the documents wasn’t privileged.

Because the privilege is absolute and applies to the communication itself and not merely to the information communicated, Aronson explained, the judge should have presumed the communications were privileged and shifted the burden to the opposing party to establish waiver, an exception, or some other reason the privilege didn’t apply, without reference to the contents.  

The dispute arose in a lawsuit between DP Pham, LLC and the estate of Robert F. Obarr, who died while the action was pending.

Pham alleges it loaned Obarr nearly $3 million, secured by a lien on a mobilehome park owned by Obarr in Westminster. It also alleges that it had a contract to purchase the property from Obarr, but later learned he had previously contracted to sell that property to another buyer, Westminster MHP Associates.

Specific Performance

Westminster sued Obarr in April 2013, seeking specific performance or damages for breach of contract, and also sued Pham and Christi Galla. It alleged that Pham and Galla, who was Obarr’s personal assistant, intentionally interfered with its contract with Obarr.

When Obarr died unexpectedly in August of that year, a special administrator, C. Tucker Cheadle, was appointed for his estate and filed a cross-complaint, pleading an interpleader claim against Westminster and Pham, and seeking damages from Pham for usury, unfair competition, and misrepresentation, among other things.

When Westminster moved for summary adjudication on its specific performance claim, Pham submitted a declaration from Galla, describing her role in Obarr’s efforts to sell the property, as well as certain offers that Shapleigh Kimes, an attorney who represented Obarr from time to time, had received for the property. Attached to the declaration were a 2012 email and a January 2013 letter from Kimes to Obarr, both of which had been copied to Galla.

The administrator responded by moving to exclude the communications as privileged and to disqualify Pham’s counsel, who had allegedly improperly communicated with Galla and coerced her into disclosing privileged communications. Disqualification was required, according to the motion, because Phan’s counsel did not notify Cheadle of receipt of the communications and had attempted to use them to the detriment of the estate.

Prima Facie Showing

Marks ruled that Cheadle made a prima facie showing that the letter and email were privileged, but that in camera review showed they were not privileged because Kimes suggested therein that he was not representing Obarr with respect to the property. This showed that there was no attorney-client relationship regarding the subject of the lawsuit, Marks ruled.

She also cited statutory exceptions to the privilege for communications “between parties all of whom claim through a deceased client,” “concerning the intention of a client, now deceased, with respect to a conveyance, will, or other writing, executed by the client,” or “concerning the validity of” any such writing.

Aronson, however, said Pham did not refute the presumption that the documents were privileged. He cited the undisputed evidence that Kimes was an attorney, that the letter and email were sent by him to Obarr, and that Obarr’s personal assistant was the only party other party to the communications.

Kimes, he noted, had declared that Obarr had an ongoing attorney-client relationship with him and that he represented Obarr with respect to the potential sale of the mobilehome park, and that he had copied Galla on the communications at Obarr’s instructions. 

Justice’s Reasoning

The trial judge’s decision to find the presumption of confidentiality to have been rebutted based on the content, Aronson said, was inconsistent with the purpose and absolute nature of the privilege.

[T]the fundamental purpose of the attorney-client privilege is to safeguard the confidential relationship between an attorney and a client to promote the open discussion of all matters relating to the representation,” he wrote. “The privilege therefore protects the confidential communication or transmission of information between an attorney and a client regardless of whether the information transmitted is otherwise privileged….The protection the privilege provides is absolute and prevents the disclosure of any part of a privileged communication regardless of its content or any particularized need for disclosure.”

Aronson went on to say that none of the statutory exceptions relied on by the trial judge apply. Westminster and Pham, he explained, are making claims against the client, Obarr, not “through” him; and there was no showing that the communications were of the type that an attesting witness would testify to. Pham, he said, was arguing for a much broader application of the exceptions than the Legislature intended.

On remand, Aronson concluded, the trial judge can still has discretion to deny the disqualification motion, if nonprivileged information—or the confidential communications, if Cheadle waives the privilege—suggest that the totality of the circumstances weighs against disqualification.

The case is DP Pham, LLC v. Cheadle, 16 S.O.S. 1888.


Copyright 2016, Metropolitan News Company