Tuesday, December 11, 2007

Fee Award Against Corporation Reversed

The Florida First District Court of Appeal held that a corporation is not liable for legal fees sought by a private lawyer "[b]ecause there is no evidence that the attorney had actual or apparent authority to represent the corporation in the matter that was the subject of the [trial court's] fee award..." The corporation was "organized to promote acupuncture and other forms of oriental medicine." Two board members hired the attorney to sue other (and a majority) of board members for defamation. The court here held : "There can be little doubt that [the board member who hired the attorney] lacked the actual authority to retain [the lawyer] as the corporation's lawyer... apparent authority might be a viable theory of recovery if [the lawyer] reasonably believed that [the board member] had authority to retain him, but that assumption is not reasonable...Surely the corporation did not intend to sue itself." The attorney had sued both the corporation and the two individuals who had actually retained him for his unpaid legal fees.(Mike Frisch)


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