Opinion
No. CV-99 0174508 S
June 3, 2005
MEMORANDUM OF DECISION ON PLAINTIFF'S OBJECTION TO ACCEPTANCE OF REPORT (#143)
This matter was brought by the Estate of Larry Somma to collect monies allegedly owed by the defendants. The undisputed facts are that in 1987, by way of a contract, Larry Somma arranged to sell his gas station business to the defendants Dennis and Dorleen Fabian. Under the terms of the contract, the sale price was $275,000, payable in four installments — $125,000 at closing and three equal installments of $50,000. The $50,000 payments were secured with promissory notes. The Fabians paid the first three installments, totaling $225,000, but had not paid the final installment at the time of Larry Somma's death in 1998; nor has that installment been paid at any time since Larry Somma's death
This suit was commenced in February 1999, almost 9 years after the date on which the parties agree the final installment of the promissory note was due to be paid. The defendants raised the statute of limitations as a defense insofar as the matter was brought over 6 years from the date the note was due and payable. In reply, the plaintiff claimed that the defendants reaffirmed or acknowledged their debt to Somma within the applicable 6-year period. On this factual issue, the parties disagree whole-heartedly.
§ 52-576(a), Conn. Gen. Stat. Provides: "No action for an account, or on any simple or implied contract or on any contract in writing, shall be brought but within six years after the right of action accrues . . ."
The defendants also raised factual defenses to the note to include claims that Somma had forgiven the debt prior to his death in view of, among other things, Fabian's assistance in negotiations with Hudson Bank on an unrelated matter, a large amount of unrecovered receivables incurred by the business for friends and associates of Somma as well as Somma's financial obligations to others which allegedly would have negated any benefit to Somma had Fabian made the final payment. This Court does not review or address the merits of these claims herein.
The case was tried before an attorney trial referee ("ATR") over several days between July and October 2003. By ATR Report filed May 19, 2004, the ATR found that the statute of limitations barred the plaintiff's action as there was insufficient credible evidence to establish that the defendants had re-affirmed or acknowledged the debt to the plaintiff's decedent within the statute of limitations period.
The plaintiff objects to the court's acceptance of the ATR Report on two grounds. First, the plaintiff claims that the ATR improperly excluded testimony of Attorney Ruben Midler, which testimony, if permitted, would have established the re-affirmation of debt. Second, the plaintiff claims error in the conclusion of the ATR that there was insufficient credible evidence upon which the trier of fact could determine that there was a re-affirmation of the debt, thus tolling the statute of limitations.
Since the first claimed error goes to a ruling made by the ATR on admissibility of evidence, the standard of review is whether or not that ruling was material error: "If the court finds that the committee or attorney trial referee has materially erred in its rulings . . . the court shall reject the report and refer the matter to the same or another committee or attorney trial referee, as the case may be, for a new trial, or revoke the reference and leave the case to be disposed of in court." Practice Book, § 19-17. "Where legal conclusions are challenged, we must determine whether they are legally and logically correct and whether they find support in the facts found by the referee." Alliance Partners, Inc. v. Oxford Health Plans, Inc., 263 Conn. 191, 202 (2001). Since the court finds, upon review, that the ATR's ruling excluding at least part of Attorney Midler's proffered testimony was erroneous, and that the exclusion of that testimony was material, it will not be necessary to go into the plaintiff's second claim of error.
At trial, the defendants sought to preclude Attorney Midler's testimony claiming that the testimony sought was protected by the attorney-client privilege. At issue, were two separate conversations between Attorney Midler and the defendant Mr. Fabian. The first occurred on December 6, 1998, shortly after Somma's death, and the second on December 11, 1998. The offer of proof as to the anticipated testimony was that at the December 6 meeting, Midler advised the defendant Mr. Fabian, that he did not represent Mr. Fabian, and could not represent Mr. Fabian. Attorney Midler further advised Mr. Fabian, allegedly, that the Estate of Mr. Somma did not want Mr. Fabian to renew the lease with Sunoco on the gas station until it had an opportunity to review the situation. The offer of proof as to the December 11 meeting was that Mr. Fabian acknowledged the debt in question in a conversation with Attorney Midler.
If Attorney Midler advised Mr. Fabian regarding the wishes of the Somma Estate, it appears that Attorney Midler also conveyed, either implicitly or explicitly, that he represented the Estate of Larry Somma, the plaintiff in this action.
The ATR heard testimony on the issue of whether an attorney-client relationship existed as between Mr. Fabian and Attorney Midler or his law firm. Mr. Midler was unequivocal that no such relationship existed, to his knowledge. On the contrary, Mr. Fabian, while decidedly short on details, testified that he considered Mr. Midler and the lawyers at his firm to be his lawyers. There was also testimony that in prior years, prior to the transaction involving the gas station, the firm had represented Mrs. Fabian or her family members. The testimony also established that in connection with the transaction between the Fabians and Larry Somma, the Fabians had separate counsel, with Ms. Midler representing Larry Somma.
The inquiry and testimony did not go beyond the single issue of whether an attorney-client relationship existed. At the conclusion of the hearing, the ATR held that Attorney Midler's testimony was protected by the attorney-client privilege. For the reasons set forth below, in this, he erred.
The court's ruling is in no way meant to be critical of the ATR. The issue of attorney-client privilege came up without prior notice at the end of a long trial with several complex issues. So far as the record discloses both parties couched the issue at trial in terms of a lawyer's ethical duty of confidentiality under Rule 1.6 of the Rules of Professional Conduct, without briefing and without citation to relevant authority on the law of evidence.
Discussion
Connecticut has a long-standing, strong public policy of protecting attorney-client communications and has adopted the common-law principle of attorney-client privilege: "Where legal advice of any kind is sought from a professional legal adviser in his capacity as such, the communications relating to that purpose, made in confidence by the client, are at his instance permanently protected from disclosure by himself or by the legal adviser, except the protection be waived." Rienzo v. Santangelo, 160 Conn. 391, 395 (1971), citing 8 Wigmore, Evidence 2292 (McNaughton Rev. 1961). See also, Doyle v. Reeves, 112 Conn. 521, 523 (1931).
We have not, as have some States, any statute altering this rule. As to the underlying reason
for affording such protection we have said: "It is obvious that professional assistance would be of little or no avail to the client, unless his legal adviser were put in possession of all the facts relating to the subject-matter of inquiry or litigation, which, in the indulgence of the fullest confidence, the client could communicate. And it is equally obvious that there would be an end to all confidence between the client and attorney, if the latter was at liberty or compellable to disclose the facts of which he had thus obtained possession; and hence it has become a settled rule of evidence, that the confidential attorney, solicitor or counselor can never be called as a witness to disclose papers committed or communications made to him in that capacity, unless the client himself consents to such disclosure." Goddard v. Gardner, 28 Conn. 172, 175. Generally, therefore, an attorney is not permitted, and cannot be compelled, to testify as to communications made to him in his professional character by his client, unless the client consents. 28 R.C.L. 548.
Doyle, 112 Conn. at 523-24.
The burden of proving facts essential to the privilege is on the person asserting it. State v. Hanna, 150 Conn. 457, 466 (1963). "To be entitled to privilege, however, the proffered evidence must meet the qualifications prescribed by the rule. 8 Wigmore, Evidence (3d.Ed.) 2292." McWilliams v. American Fidelity Co., 140 Conn. 572, 581 (1954). One of the essential elements of the claim of privilege between attorney and client is that the communication be confidential. Rienzo, 160 Conn. at 395; Hanna, 150 Conn. at 466; LaFaive v. DiLoreto, 2 Conn.App. 58 (1984). Thus, the defendants, as the proponents of the privilege, had the burden to prove not only the existence of an attorney client relationship (or their reasonable belief that such a relationship existed), but also that the communication in question was made in confidence for the purpose of seeking advice of counsel. Turner's Appeal, 72 Conn. 305 (1899), states that an attorney may properly be requested to answer the questions by whom he is employed and in what capacity. Id. at 318. An attorney is not bound to remain silent as to all information regarding his client, but only as to that information born of confidential communication. State v. Manning, 162 Conn. 112, 121 (1971) (The court did not err by allowing the attorney to be called as a witness nor did it err by allowing the witness to answer two questions, since neither related to communications between the attorney and his client.) "The fact that an attorney may not disclose privileged communications between himself and his client does not affect his capacity and his duty to testify as to other matters when called on to do so." Id. at 120.
At issue in this matter are two instances of communication between Attorney Midler and Mr. Fabian, a meeting on December 6, 1998 and a second meeting on December 11, 1998. The offer of proof as to the first involved anticipated testimony that the Fabians contacted Attorney Midler in connection with the matter in controversy and that during the consultation, Attorney Midler advised the Fabians that he could not represent them in this matter; did not represent them and that in fact, he represented the Estate of Larry Somma.
The Attorney Trial Referee excluded this evidence, based in large measure on the Fabian's testimony that they considered Attorney Midler's firm to be their counsel. This court does not disturb the assessment of the testimony on this point. The ATR apparently determined that, erroneously or not, the Fabians considered Mr. Midler to be their counsel and so therefore consulted him on December 6, 1998. As such, theft communications with him at this first meeting would be protected by the attorney-client privilege to the extent that they were "made in confidence" for the purpose of obtaining legal counsel.
The Court does not disturb this factual finding despite the fairly significant evidence that no actual attorney client relationship existed. The ATR could easily have determined that, Ms. Fabian had an earnest and sincere belief that Mr. Midler's firm, which had long been associated with the gas station through Mr. Somma, became "his lawyer" when he purchased an interest in gas station. His sincere and reasonable belief would be sufficient to provide him the protection of the attorney-client privilege. See e.g. United States v. Dennis, 843 F.2d 652, 657 (2d. Cir. 1988).
However, the plaintiff does not offer any statements made by the Fabians at this meeting or even substantive advice offered by Attorney Midler. Indeed, the offer of proof from this meeting was simply to establish that the Fabians were told by Attorney Midler that he could not and did not represent them. This communication does not meet the definition of an attorney-client communication to which the privilege would attach. The Attorney Trial Referee erred when he excluded this testimony.
With this testimony excluded, the Attorney Trial Referee did not have all of the evidence available with which to determine whether the second meeting with Attorney Midler, and the statements allegedly made therein, were privileged. If the client understood that the attorney refused to act for him and that the attorney was retained by another person in an adverse position, the privilege does not apply. United States v. Dennis, 843 F.2d 652, 657 (2d Cir. 1988) If, upon a retrial of this matter, testimony or evidence offered establishes to the satisfaction of the ATR that Attorney Midler told Mr. Fabian that he did not and could not represent him, and in fact that he represented the plaintiff, then the communications made at the second meeting would not fit within the parameters of an attorney client communication to which privilege attaches. In short, if the Fabians were told at and understood from the first meeting, that Mr. Midler could not and did not represent them, any communications following that advisement would not be privileged communications. See e.g. 8 Wigmore, Evidence § 2304 (McNaughton rev. 1961) ("If the client continues his communication after the attorney's refusal to act for him, or if a person knowingly attempts to retain one who is already retained by the opponent and therefore was not retainable by the consultant, he does not need or deserve the protection of the privilege."). This is especially so if the ATR finds that the Fabians were advised that in fact, Mr. Midler represented the plaintiff in this action. Id. And the exclusion of Attorney Midler's proffered testimony as to the December 6 meeting with the Fabians was obviously material. Even without considering Attorney Midler's proffered testimony, the ATR described the issue as to re-affirmation of the debt as a "close factual question." (Decision of Attorney Trial referee, p. 6.) By considering the evidence offered as to what Attorney Midler said at the December 6 meeting, which might have resulted in the proffered evidence of the defendants' re-affirmation of debt at the December 11 meeting being admissible, the outcome on that crucial issue might have been different.
There was no testimony from either the plaintiff or the defendants on this issue. The court does not by this decision suggest any limitation on the evidence that might be offered from either side on this issue.
In view of the factual determinations that are yet to be made, the Court does not make any findings as to the admissibility of the statements made at the second meeting as such a determination should be made, in the first instance, at a re-trial of this matter. If, however, the statements from the second meeting are determined not to be privileged, the trier will have to determine anew, along with all the other issues in the case, whether the evidence is sufficient to establish that the defendants acknowledged the debt within the applicable statute of limitations.
Order
The Plaintiff's Objection to Acceptance of Report (#143) is therefore sustained. The judgment of the court is that the Decision of Attorney Trial Referee dated May 18, 2004 is rejected and the case is referred back to Attorney Trial Referee David M Cohen, Esq. for a new trial.
Alfred J. Jennings, Jr., Judge