## Facts

- In 1969, Helen C. Greene created an inter vivos trust, naming herself the income beneficiary, with remainder interests to trusts for each surviving child.
- The trust instrument contemplated a high-risk investment approach and acknowledged inherent business risks.
- Helen Greene and Theodore J. Greene were named co-trustees.
- Helen later sued Theodore Greene and his law firm, Finley, Kumble, Wagner, Heine & Underberg, alleging misconduct in the trust’s creation and management (including breach of fiduciary duty and fraud).
- Two lawyers later associated with Helen’s counsel—Norman Roy Grutman and Jewel Bjork—were formerly partners at Finley, Kumble and subsequently joined Eaton, Van Winkle, Greenspoon & Grutman (Eaton).
- Before retaining Eaton, Helen was informed that Grutman and Bjork might face personal exposure for wrongdoing attributed to Finley, Kumble and that their involvement created at least an appearance of conflict; she nevertheless chose Eaton.
- Defendants moved to disqualify Eaton; the trial court denied the motion, and the Appellate Division affirmed, then certified a question for further review.

## Issues

1. Whether a law firm should be disqualified from representing a plaintiff when members of that firm were formerly partners of the defendant firm and face potential personal liability arising from the same alleged misconduct.
2. Whether the client’s informed preference to retain counsel can avoid disqualification where the representation threatens loyalty and the integrity of the adversary process.

## Decision

- The Court of Appeals modified the order below and granted the motion to disqualify Eaton from representing Helen Greene.
- The court concluded that Eaton’s representation was improper because attorneys in the firm had personal interests (potential liability and reputational exposure) that could conflict with the client’s interest in pursuing full relief.
- The court treated the conflict and appearance of impropriety as sufficiently serious that client consent did not resolve the problem.
- Relief was limited to disqualification of counsel; the court did not dismiss the underlying action.

## Legal Principles

- Attorneys and firms may be disqualified when a lawyer’s personal interests, including potential liability in the matter, materially conflict with the client’s interests.
- Conflicts that realistically can restrain counsel’s advocacy—such as reluctance to pursue claims implicating the lawyer or the lawyer’s colleagues—warrant disqualification.
- The appearance of impropriety and the public’s confidence in the fairness of proceedings are independent concerns supporting disqualification, beyond the client’s private preference.
- A party’s interest in counsel of choice is qualified and may yield where continued representation threatens the integrity of the adversary system.

## Conclusion

The New York Court of Appeals required disqualification of the plaintiff’s selected firm because lawyers within that firm faced potential personal liability tied to the alleged wrongdoing, creating conflicts and an appearance of impropriety that client consent could not cure; the case proceeded without dismissal but with new counsel.


Greene v. Greene, 391 N.E.2d 1355 (N.Y. 1979)