United States District Court, S.D. Mississippi, Eastern Division
LYNDA B. JARRELL and TERRY D. JARRELL PLAINTIFFS
SHELTER MUTUAL INSURANCE COMPANY DEFENDANT
MICHAEL T. PARKER UNITED STATES MAGISTRATE JUDGE.
MATTER is before the Court on Defendant's Motion  to
disqualify William H. Jones, one of Plaintiffs'
attorneys. Having considered the parties' submissions,
the record, and the applicable law, the Court finds that the
Motion  should be granted.
January 17, 2018, Plaintiffs' house was damaged by a
fire. Plaintiffs filed this action in state court on
September 19, 2018,  asserting breach of contract and bad faith
claims against Shelter Mutual Insurance Company
(“Shelter”). Plaintiffs allege that Shelter
wrongfully refused to pay the full amount owed under
Plaintiffs' insurance policy.
suit was filed, Plaintiffs' counsel, William H. Jones,
Shelter's claim adjuster, Earl Haines, exchanged written
correspondence on several occasions. Jones and Haines also
had multiple telephone conversations. These conversations
took place on April 17, 2018, June 19, 2018, and August 20,
2018. As previously mentioned, Plaintiffs filed suit on
September 19, 2018.
instant Motion , Shelter argues that, as a result of the
telephone conversations between Jones and Haines, Jones is a
necessary witness and, therefore, must be disqualified from
serving as Plaintiffs' counsel. As a substantive motion,
Shelter's disqualification motion must be decided under
federal law. See F.D.I.C. v. U.S. Fire Ins. Co., 50
F.3d 1304, 1312 (5th Cir. 1995).
“‘[D]isqualification cases are governed by state
and national ethical standards adopted by the
court.'” Id. (quoting In re American
Airlines, Inc., 972 F.2d 605, 610 (5th Cir. 1992)).
Federal courts consider ethical standards set forth in the
local rules, state rules, model rules, and model code.
Id. “All of the facts particular to a case
must be considered, in the context of the relevant ethical
criteria and with meticulous deference to the litigant's
rights.” Id. at 1314.
Rules of the Southern District of Mississippi specifically
adopt the Mississippi Rules of Professional Conduct. The
Mississippi Rules of Professional Conduct are identical to
the American Bar Association's Model Rules of
Professional Conduct in all relevant aspects. United
States v. Starnes, 157 Fed. App'x. 687, 693-94
(5th Cir. 2005). Mississippi Rule of Professional Conduct 3.7
provides as follows:
(a) A lawyer shall not act as advocate at a trial in which
the lawyer is likely to be a necessary witness except where:
(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal
services rendered in the case; or
(3) disqualification of the lawyer would work substantial
hardship on the client.
Miss. R. Prof. Conduct 3.7.
asserts that after its inspection of Plaintiffs' house,
it determined that the January 17, 2018, fire partially
destroyed the house and that there remained portions of the
house which were usable-“usable remnants.” Along
with a letter dated April 13, 2018, Shelter tendered a
payment to Plaintiffs covering the partial loss. Plaintiffs,
however, did not accept this payment. They maintained that
the house was a total loss and that Shelter should have
tendered policy limits.
September 19, 2018, Plaintiffs filed their Complaint [1-2],
asserting breach of contract and bad faith claims. Shortly
thereafter, Shelter tendered a payment in excess of the
policy limits. See Defendant's Brief  at 4;
Plaintiffs' Brief  at 15. Thus, Plaintiffs have been
paid the full amount under their contract claims. Plaintiffs,
however, also seek extra-contractual damages.
argues, inter alia, that Plaintiffs have placed at
issue the questions of what information about the house's
usable remnants was conveyed to Plaintiffs by Shelter and
when that information was conveyed. Shelter argues that this
is a critical issue and observes that Plaintiffs allege that
they repeatedly requested information concerning the
house's usable remnants, but Shelter refused to provide
such information. See Complaint [1-2] at 5, 7, 10,
11. As an example, Plaintiffs allege the following:
“Defendants have failed and refused to identify what
parts of the remaining ruins of their home are susceptible to
reasonable repair. This request has been made numerous times
without response.” Id. at 11.
asserts that, contrary to Plaintiffs' allegations, Haines
conveyed information about the house's usable remnants to
Jones during their conversations. Shelter asserts that
Plaintiffs' claims require proof that Shelter failed to
respond to Plaintiffs' pleas for information concerning
usable remnants and Shelter's defense requires proof that
Haines conveyed this information to Jones. Shelter argues
that Jones must provide testimony concerning his
conversations with Haines.
points out that, during his deposition, Haines rebutted
Plaintiffs' allegations. During Haines's ...