Former law firm denied intervention

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It was a proper exercise of judicial discretion to deny a law firm’s motion to intervene in a closed case handled by a former associate, the Wisconsin Court of Appeals held on Aug. 29.

James J. Gende was employed as an associate by Cannon & Dunphy, S.C. until April 2004. When he left Cannon & Dunphy, a number of clients went with him, including Kelly S. Longergan, who was pursuing a personal injury action against Employers Mutual Casualty Company, and its insured, Marganne K. Lamar.

The case settled in May 2004, and was dismissed in July. In March 2005, Cannon & Dunphy moved to intervene in the action, but Milwaukee County Circuit Court Clare L. Fiorenza denied the motion.

Cannon & Dunphy appealed, but the court of appeals affirmed in a decision by Judge Ralph Adam Fine.

Rule 803.09(1) provides, “Upon timely motion anyone shall be permitted to intervene in an action when the movant claims an interest relating to the property or transaction which is the subject of the action and the movant is so situated that the disposition of the action may as a practical matter impair or impede the movant’s ability to protect that interest, unless the movant’s interest is adequately represented by existing parties.”

The court acknowledged that Cannon & Dunphy “claims an interest relating to the property or transaction which is the subject of the action.” However, the court found that none of the other requirements were met.

The court noted that Cannon & Dunphy did not seek to intervene in the action until eight months after the action was dismissed; thus the motion was not timely.

The trial court rejected the firm’s argument that it did not know of the settlement until it filed the motion to intervene. Because the firm knew that Lonergan ended her attorney-client relationship when Gende left the firm, the court concluded that, even if there was no knowledge of the settlement, the firm knew there was an issue with respect to payment of fees and costs in the case.

The court also found that the firm had other avenues available to protect its claimed interest, because Gende and the firm are currently litigating issues involved in Gende’s departure from the firm, and the dispute can be resolved in that action. Also, the firm can file an action to enforce any attorney lien it may have under sec. 757.37.

The trial court had noted that, because there were many former client cases involved in the firms’ dispute with Gende, “the most judicial way to proceed is to have one judge decide the issue regarding the separation agreement.”

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Giving substantial deference to the trial court’s determinations, the court of appeals concluded that the trial court properly considered
the appropriate factors, and affirmed.

It is noteworthy that a different panel of the court of appeals also issued a decision last week affirming a circuit court’s denial of a motion by Cannon & Dunphy to intervene in another of Gende’s cases, but did not recommend that opinion for publication. Olivarez v. Unitrin Property & Casualty Ins. Co., No. 2005AP2471.

Like the court in the case at bar, the court concluded that the firm has other means to protect its interest.

However, the court also emphasized the broad discretion that a circuit court has: “Were the question one of law, or were we ruling in the first instance rather than as an appellate body, we likely would rule for Cannon & Dunphy. But given the deference we must accord the trial court’s discretionary call, we are constrained to affirm the trial court’s ruling.”

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David Ziemer can be reached by email.