THE PARK APARTMENTS AT FAYETTEVILLE, LP; THE PARK APARTMENTS AT FAYETTEVILLE MANAGEMENT COMPANY, LLC; AND LINDSEY MANAGEMENT CO., INC. APPELLANTS
SHILAH PLANTS APPELLEE
FROM THE WASHINGTON COUNTY CIRCUIT COURT [NO. 72CV-15-2068-1]
HONORABLE JOHN C. THREET, JUDGE
M. Pesek, for appellants.
Auer, Legal Aid of Arkansas, Inc., for appellee.
K. WOOD, Associate Justice.
The Park Apartments at Fayetteville, LP, The Park Apartments
at Fayetteville Management Company, LLC, and Lindsey
Management Co., Inc. (Lindsey) (collectively "the
Park"),  appeal centers around the following issue:
Do Arkansas's Rules of Professional Conduct require
attorney disqualification simply because the attorney had
access to client information but did not gain actual
knowledge while practicing at her former association? We hold
that they do not, and therefore, we reverse and remand.
November 2015, appellee Shilah Plants filed a complaint
against the Park alleging that the liquidated-damages clause
in her lease agreement is unenforceable, constitutes an
illegal penalty, and violates the Arkansas Deceptive Trade
Practices Act and the Arkansas Security Deposit Act.
Plants's attorneys work for Legal Aid of Arkansas (Legal
Aid) in Jonesboro. Attorneys from Lindsey's in-house
legal department represent the Park.
July 2016 through December 2016, Summer McCoy worked as a
staff attorney for Legal Aid in its Springdale office. Legal
Aid assigns cases among attorneys based on four workgroups:
domestic violence, consumer, housing, and economic justice.
McCoy worked in the economic-justice workgroup which
primarily deals with issues associated with Medicare,
Medicaid, ARKids, SNAP benefits, unemployment benefits, and
home healthcare. In January 2017, McCoy began working as a
staff attorney for Lindsey.
February 2017, Plants filed a motion to disqualify the
Park's attorney and Lindsey's entire in-house legal
department. Plants alleged a conflict of interest arose
because, while McCoy was working at Legal Aid, she had access
to Plants's confidential attorney and client information
and files. Plants further claimed that although McCoy did not
appear as counsel in the case, McCoy's conflict of
interest should be imputed to the Park's attorney and the
entire Lindsey legal department because McCoy is now part of
a July 2017 hearing, the circuit court concluded that McCoy
had a conflict of interest because "she had full access
to all of Legal Aid's files." The circuit court
further imputed McCoy's conflict to the other attorneys
in Lindsey's in-house legal department. Consequently, it
granted the motion to disqualify. Park filed an interlocutory
appeal pursuant to Arkansas Rules of Appellate
Park makes four arguments on appeal: (1) the circuit court
erroneously applied Norman v. Norman, 333 Ark. 644,
970 S.W.2d 270 (1998), when it concluded that access to
client information alone is sufficient for attorney
disqualification; (2) Legal Aid does not have any
confidential information because its information is subject
to disclosure under the Arkansas Freedom of Information Act;
(3) the circuit court erred in disqualifying the Park's
attorney because McCoy's association with Lindsey's
legal department did not create an appearance of impropriety;
and (4) the circuit court erred in failing to find Plants
waived her right to move to disqualify the Park's
counsel. Because we reverse on the first point, we do not
address the remaining arguments.
Principles of Law and Analysis
appeal, we review a circuit court's decision to
disqualify an attorney under an abuse-of-discretion standard.
Sturdivant v. Sturdivant, 367 Ark. 514, 241 S.W.3d
740 (2006). An abuse of discretion may be manifested by an
erroneous interpretation of the law. Craig v.
Carrigo, 340 Ark. 624, 12 S.W.3d 229 (2000). The
Arkansas Rules of Professional Conduct are applicable in
disqualification proceedings. Norman, 333 Ark. at
651, 970 S.W.2d at 272-73. We read the rules as they are
written and interpret them in accordance with our established
principles of rule construction. Sturdivant, 367
Ark. at 517, 241 S.W.3d at 743. If the rule's language is
plain and unambiguous, we will give it the obvious and plain
begin with the Park's first argument that the circuit
court erroneously applied Norman. The Park asserts
that under the Arkansas Rules of Professional Conduct an
attorney must have actual knowledge of confidential
information to be disqualified, and the circuit court
erroneously interpreted Norman as holding that
access to a client's information alone is sufficient for
Norman, we reversed the trial court's decision
not to disqualify an attorney, Newell, who was representing
the ex-wife in a petition to enforce an alimony provision
contained in a divorce decree, because Newell's law
partner was formerly associated with Callahan, who had
represented the ex-husband during the parties' earlier
divorce proceeding. Norman, 333 Ark. at 653-54; 970
S.W.2d at 273-74. In considering the disqualification, we
stated, "[A]n attorney must have actual knowledge . . .
during his association before the attorney and his firm will
be disqualified." Id. at 654; 970 S.W.2d at
274. We further stated that "an attorney is presumed to
have all the confidential knowledge that any member of his
first firm possessed." Id. This is a rebuttable
presumption and the second firm has the burden to overcome