TEXAS SUPREME COURT DECISIONS ON DISQUALIFICATION
IIn Re Guaranty Ins. Services, Inc.,
No. 10-0364 (Tex. Jul. 1, 2011)(per curiam opinion) (mandamus granted)
(practice of law, conflicts of interest involving paralegal working for both sides in suit, disqualification)
What happens when a law firm’s efforts to screen a conflict fail, permitting a nonlawyer who worked on one
side of a case at one firm to work on the other side of the same case at the opposing firm? Here, the trial
court disqualified the second firm, reasoning there was a conclusive presumption that the nonlawyer had
shared confidential information, despite evidence he had not. A divided court of appeals denied mandamus
relief. 310 S.W.3d 630, 634. Given our prior decisions on the subject—particularly our recent decision in
In re Columbia Valley Healthcare System, L.P., 320 S.W.3d 819 (Tex. 2010) (orig. proceeding), issued four
months after the court of appeals’ decision below—we conclude disqualification was not warranted. Further,
because the improper disqualification was a clear abuse of discretion for which there is no adequate remedy
by appeal, mandamus relief is warranted. See In re Prudential Ins. Co., 148 S.W.3d 124, 135–36 (Tex. 2004)
(orig. proceeding) (describing when mandamus relief may issue); NCNB Tex. Nat’l Bank v. Coker, 765 S.W.2d
398, 400 (Tex. 1989) (orig. proceeding) (granting mandamus in context of improper disqualification). We
conditionally grant mandamus relief and direct the trial court to vacate its disqualification order.
For these reasons, and without hearing oral argument, see Tex. R. App. P. 52.8(c), we conditionally grant
mandamus relief and direct the trial court to vacate its order granting the motion to disqualify. We are
confident the trial court will comply, and the writ will issue only if it does not.
CASE DETAILS: IN RE GUARANTY INSURANCE SERVICES, INC.; from Travis County; 3rd district (03-09-
00640-CV, 310 SW3d 630, 04-16-10)
Pursuant to Texas Rule of Appellate Procedure 52.8(c), without hearing oral argument, the Court
conditionally grants the writ of mandamus.
Per Curiam Opinion [pdf]
Here is the link to e-briefs in case no. 10-0364 IN RE GUARANTY INSURANCE SERVICES, INC.
COURT OF APPEALS CASES
ROY SEGER, ET AL. v. YORKSHIRE INSURANCE CO., LTD. AND OCEAN MARINE INSURANCE CO., LTD.;
from Hutchinson County; 7th district (07‑05‑00188‑CV, ___ SW3d ___, 06‑20‑07)
2 petitions, motion to consolidate dismissed as moot (insurance coverage dispute, Stower’s doctrine, recusal,
Recusal of Judge
Insurers contend that the denial of their motion to recuse Judge LaGrone was an abuse of discretion
because, as the judge that presided over the underlying trial, Judge LaGrone was a vital material witness in
the Stowers suit and had personal knowledge of disputed material facts. The denial of a motion to recuse is
reviewed for abuse of discretion. Brosseau v. Ranzau, 81 S.W.3d 381, 399 (Tex.App.-Beaumont 2002, pet.
denied). Insurers contend that the Segers' citation to Judge LaGrone's statement in the underlying trial
transcript that "The Court will call for trial in Cause No. 30,110, . . ." made Judge LaGrone a vital material
witness in the Stowers action. However, the complete transcript of the underlying proceeding, which includes
the statement Insurers complain of, was admitted into evidence in the Stowers action. Further, Judge
LaGrone's calling the underlying proceeding for trial did not constitute his participation "as . . . material
witness in the matter in controversy." Tex. R. Civ. P. 18b(2)(d). Certainly, as addressed above, Insurers may
refute Judge LaGrone's characterization of the underlying proceeding as a "trial," but we do not conclude
that the trial court abused its discretion in denying Insurers' motion for recusal on this basis.
Additionally, Insurers contend that Judge LaGrone must have knowledge of disputed evidentiary facts
regarding whether the underlying proceeding was, in fact, a fully adversarial trial. However, Insurers fail to
identify any specific knowledge of disputed evidentiary facts purportedly held by Judge LaGrone. We will not
find recusal appropriate solely on the basis of speculation regarding facts that may or may not be known by
the presiding judge.
We overrule Insurers' challenge to the denial of their motion to recuse.
Disqualification of Counsel
Finally, Insurers contend that two attorneys in the Segers' counsel, Brian Heinrich and Joe Hayes, were
disqualified from representing the Segers in their Stowers action because each (1) were witnesses in the
Stowers action, see Tex. Disc. R. Prof. Cond. 3.08, and (2) were to be paid on a contingent basis, see Tex.
Disc. R. Prof. Cond. 3.04. The denial of a motion for disqualification is reviewed for abuse of discretion. See
Metro. Life Ins. Co. v. Syntek Fin. Corp., 881 S.W.2d 319, 321 (Tex. 1994). As both parties to the present
dispute acknowledge, the disqualification of counsel is a severe remedy, which is not to be invoked lightly.
See In re Nitla S.A. de C.V., 92 S.W.3d 419, 422 (Tex. 2002). Even if challenged counsel has committed a
disqualifying act, the party requesting disqualification must demonstrate that counsel's conduct caused
actual prejudice. Id.
Assuming, without deciding, that Heinrich and/or Hayes were lawyer-witnesses such that they would be
disqualified from representing the Segers in the Stowers action, Insurers have failed to present any evidence
that they were harmed. Insurers cite a deposition of Professor Bob Schuwerk, which is not a part of the
record, as concluding that Heinrich and Hayes violated Rules 3.04 and 3.08 of the Texas Disciplinary Rules
of Professional Conduct. However, proof that an attorney violated a Rule of Professional Conduct, without a
further showing of harm, is insufficient to justify disqualification. Id. Nothing in Insurers' discussion of
Schuwerk's deposition identifies how they were harmed by any alleged violation of the Rules by either
Heinrich or Hayes.
Insurers contend that the trial court took certain unrelated actions to avoid having to rule that Heinrich and
Hayes were disqualified to represent the Segers in the Stowers action, however, this contention is wholly
unsupported by evidence and is purely speculative. See Miller v. Hood, 536 S.W.2d 278, 285 (Tex.Civ.App.-
Corpus Christi 1976, writ ref'd n.r.e.) (presumption of regularity and validity of trial court rulings unless
facially invalid or invalidity shown in the record). Additionally, while Insurers contend that Hayes and Heinrich
were disqualified because they were witnesses whose payment was contingent upon the outcome of the
case, Insurers fail to identify any evidence establishing that Hayes or Heinrich were being paid on a
We overrule Insurers' issue regarding the denial of their motion to disqualify Hayes and Heinrich.