United States District Court, M.D. Alabama, Eastern Division
MT. HEBRON DISTRICT MISSIONARY BAPTIST ASSOCIATION OF AL, INC., Plaintiff,
SENTINEL INSURANCE COMPANY, LIMITED, Defendant,
LANDON ALEXANDER, SR., Third-Party Defendant.
BORDEN UNITED STATES MAGISTRATE JUDGE
the court is Third-Party Defendant Landon Alexander,
Sr.'s Motion to Disqualify Counsel (Doc. 87), which seeks
the disqualification of counsel for Plaintiff Mt. Hebron
District Missionary Baptist Association of Alabama, Inc.
(“Mt. Hebron”). Mt. Hebron has responded in
opposition to the motion (Docs. 90 & 92), Alexander has
filed a reply in support (Doc. 91), and the parties were
heard on the motion during a telephonic hearing on August 3,
2017. For the reasons stated below, and after careful review
of the parties' submissions and the applicable law, it is
ORDERED that the motion (Doc. 87) is GRANTED and that the law
firm of Funderburk & Lane is disqualified from the
representation of Mt. Hebron in this lawsuit.
FACTUAL AND PROCEDURAL BACKGROUND
early procedural history of this litigation is set out in the
court's Report and Recommendation of March 16, 2017 (Doc.
76). For present purposes, the core dispute is whether
Alexander is a proper recipient of the proceeds of an
insurance policy issued by Sentinel Insurance Company,
Limited (“Sentinel”) for a church building
operated by Mt. Hebron until a tornado destroyed it. Doc. 11.
The operative complaints are Mt. Hebron's First Amended
Complaint (Doc. 11), Mt. Hebron's Third-Party Complaint
against Alexander (Doc. 34), and Sentinel's Complaint in
Interpleader (Doc. 24). Sentinel interpleaded the proceeds
from the insurance policy, and the interpleader action will
be resolved before addressing the underlying claims,
counterclaims, and third-party claims. See, e.g.,
Docs. 83 & 89.
one roadblock stands in the way of the orderly resolution of
the interpleader action: Alexander insists that he consulted
with Attorney Kenneth Funderburk of the law firm of
Funderburk & Lane about this very matter in 2015. Doc.
87-1. Funderburk nevertheless undertook the representation on
behalf of Mt. Hebron. Alexander raised this potential
conflict of interest with Funderburk no later than December
2016. Doc. 87-4 at 5. Funderburk does not acknowledge a
conflict of interest and has refused to withdraw voluntarily
from the representation. As a result, Alexander filed the
instant motion on June 27, 2017. Doc. 87.
and Funderburk agree on certain of the operative facts. They
agree that they met at Funderburk's law office on at
least two occasions during 2015. Docs. 87-1 at ¶ 9 &
90-1 at ¶ 5-9. One meeting occurred on May 5, 2015, and
another on June 16, 2015. Docs. 87-1 at ¶ 9 & 90-1
at ¶ 5 & 9. Alexander paid Funderburk $50 by check
for the meeting in May and $75 by check for the meeting in
June, with both checks drawn on an account held in
Alexander's name. Docs. 87-1 at ¶ 9 & 90-1 at
¶ 5 & 9. The memorandum line for Alexander's
checks indicated, respectively, that the payments were for a
“Consultation fee” and a “lawyer.”
Docs. 87-2 & 87-3. Funderburk negotiated both checks and
has not refunded the fees. See Docs. 87-2 &
87-3. This is consistent with Funderburk's general
practice for consultations in that he customarily charges a
consultation fee, which covers about fifteen minutes of his
time. Doc. 90-1 at ¶ 3, 5 & 9.
the time of these meetings, Alexander left a number of
documents at the offices of Funderburk & Lane for
Funderburk's review, including an invoice from Alexander
to the “Mount Hebron District Association Center”
for “a loan that is being paid with no interest or
labor fee, ” which described the terms of the loan and
characterized Alexander as the “mortgage holder”;
a copy of the warranty deed for the Mt. Hebron property; and
a copy of the Mt. Hebron by-laws, which include the provision
that the building may not be sold without paying Alexander or
his heirs the sum of $200, 000. Doc. 90-11. Funderburk kept
these documents in a filing cabinet and he does not recall
reviewing them. Doc. 90-1 at ¶ 13.
Funderburk and Alexander agree on these basic facts,
otherwise the substance of their meetings is largely in
dispute. Alexander claims that he constructed Mt.
Hebron's building under an agreement that his expenses
and labor would serve as an interest-free loan to Mt. Hebron.
Doc. 87-1 at ¶ 2-3. Mt. Hebron had not fully reimbursed
him by early 2015, and Alexander's purpose in seeing
Funderburk was to seek his legal advice on how to get Mt.
Hebron to make good on the loan. Doc. 87-1 at ¶ 5-6.
During their meetings, Alexander told Funderburk that he
wanted to be recognized as a mortgagee on the property,
described the facts underlying the dispute, and shared his
communications with Mt. Hebron officials. Doc. 87-1 at ¶
7. He asked Funderburk how to memorialize his interest in the
property and ultimately requested that Funderburk draw up the
documentation to do so. Doc. 87-1 at ¶ 7. Funderburk
reviewed Alexander's documents and gave his initial
opinion that Alexander has a “good case” for
reimbursement, but later reversed course and said that it
would be difficult to get Mt. Hebron to repay the loan. Doc.
87-1 at ¶ 8 & 11.
remembers the meetings differently. For many decades,
Funderburk has served as an attorney for a number of
religious organizations in and around Russell County,
Alabama, including Mt. Hebron. Doc. 90-1 at ¶ 6. When he
agreed to take a meeting with Alexander in May 2015,
Funderburk believed that Alexander was a member of a
prominent family associated with Mt. Hebron. Doc. 90-1 at
¶ 6. However, as soon as he saw Alexander, Funderburk
realized that he was mistaken and he did not know Alexander.
Doc. 90-1 at ¶ 6. He took the May 5 meeting with
Alexander anyway, and by the end of the meeting Funderburk
understood that Alexander was “seeking [his]
advice” on an “ongoing disagreement between
[Alexander] and the other board members of Mt. Hebron.”
Doc. 90-1 at ¶ 8. Funderburk does not recall the
specific details of that dispute, but maintains that he and
Alexander did not talk about Alexander's request to
memorialize a debt or to have himself listed as a mortgagee,
or the need for Funderburk's assistance in drafting
documents to accomplish these goals. Doc. 90-1 at ¶ 7.
took the June 16 meeting understanding it to be following up
on Alexander's disagreement with the Mt. Hebron board
members. Doc. 90-1 at ¶ 9. During the meeting, Alexander
referred to a debt owed to him by Mt. Hebron. Doc. 90-1 at
¶ 11. It eventually became apparent to Funderburk that
Alexander's interests were adverse to Mt. Hebron's,
and as a result Funderburk told Alexander that he would not
represent him. Doc. 90-1 at ¶ 11.
that time, Alexander believed that Funderburk was already
serving as his attorney. Doc. 87-1 at ¶ 12. He had not
been told to restrict or limit his discussion of the dispute
with Mt. Hebron or the facts leading it. Doc. 87-1 at ¶
12. Funderburk had not mentioned that he was meeting with
Alexander in his capacity as a lawyer for Mt. Hebron. Doc.
87-1 at ¶ 12. As a result, Alexander assumed he could
speak honestly and freely with Funderburk and that his
communications would be kept in confidence. Doc. 87-1 at
¶ 13. He would not have consulted Funderburk on these
issues if he had known that Funderburk would represent Mt.
Hebron in this lawsuit. Doc. 87-1 at ¶ 13.
whole, lawyers hold themselves to high standards of candor
and fair dealing.
however, when the lawyers do not police themselves, the court
must exercise its inherent authority to discipline them as
officers of the court. E.g., In re Snyder,
472 U.S. 634, 643 (1985) (“Th[e] inherent power [to
discipline lawyers] derives from the lawyer's role as an
officer of the court which granted admission.”) (citing
Theard v. United States, 354 U.S. 278, 281 (1957)).
This is, unfortunately, one of those occasions in which the
court “is obligated to take measures against unethical
conduct.” Woods v. Covington Cnty. Bank, 537
F.2d 804, 810 (5th Cir. 1976). The Middle District of
Alabama's local rules charge the district's judges
with insuring that the lawyers appearing before this court
avoid misconduct in all forms, including violations of the
Alabama Rules of Professional Conduct. M.D. Ala. LR 83.1(g)