Business & Practice

Montana Lawyer Disqualified in Bad Faith Insurance Action

Oct. 8, 2019, 5:52 PM

A Montana attorney can’t represent his client in the client’s suit against his insurer because the attorney represented him in the underlying claim, a federal district court ruled Oct. 7.

Attorney Gary Crowe is likely to be a necessary witness at Jay Timlick’s trial, “which means disqualification is warranted” and no exception to the state ethics rule applies here, Judge Kathleen L. DeSoto wrote for the U.S. District Court for the District of Montana.

After Timlick was rear-ended in his vehicle, he filed an underinsured motorist claim with his insurance company. After they settled, he sued the company for breach of contract and violations of Montana’s Unfair Trade Practices Act.

The company argued that because Crowe had represented Timlick in the underinsured claim, he would likely be at witness in the bad faith action. This would thus disqualify him under Montana’s professional conduct rules from representing Timlick again.

The rule forbids an attorney from acting as an advocate at a trial in which the lawyer is likely to be a necessary witness, with three exceptions.

The court agreed with the company and found that no exception to the rule applied. Crowe is likely to be a necessary witness because he was present for much of alleged misconduct giving rise to the bad faith claims, it said.

And Timlick won’t face substantial hardship—the only exception to the rule that could apply—if Crowe is disqualified because Crowe can still participate in almost all pretrial activities and there’s “ample” time for Timlick to hire new counsel for the trial portion, the court explained.

The case is Timlick v. Liberty Mut. Ins. Co., 2019 BL 384103, D. Mont., No. CV 19-99-M-DLC-KLD, 10/7/19.

To contact the reporter on this story: Melissa Heelan Stanzione in Washington at mstanzione@bloomberglaw.com

To contact the editors responsible for this story: Jessie Kokrda Kamens at jkamens@bloomberglaw.com; Rebekah Mintzer at rmintzer@bloomberglaw.com

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