Wednesday, April 23, 2014
The New Jersey Appellate Division sharply criticized counsel who had failed to timely advise the court that the case had settled.
We were on the eve of filing a comprehensive opinion on the many issues raised in this appeal when, on April 9, 2014, respondent's counsel advised the matter had settled. Upon further inquiry, we learned the parties reached a settlement months ago. Despite our discretion to file an opinion when notified at such a late hour, we have decided not to file our opinion on the merits and now write to dismiss the appeal with the emphatic reminder that counsel must advise this court in a far more timely manner of a settlement or serious settlement discussions so that scarce judicial resources are not needlessly wasted.
But no sanctions
Because of the enormous amount of time needlessly expended in this matter, we have seriously considered the imposition of sanctions against both counsel pursuant to Rule 2:9-9, but instead have determined that the publication of this decision is sufficient deterrent to repetition. It is within our discretion to issue an opinion when notified of a settlement shortly before an opinion is scheduled to be released, and we have done so many times. We nonetheless dismiss this appeal.
Wednesday, January 8, 2014
An order dismissing a legal malpractice claim based on allegedly erroneous tax advice was reversed by the New York Appellate Division for the Second Judicial Department.
The facts of the alleged malpractice
The plaintiff commenced this action to recover damages allegedly sustained as a result of the defendants' legal malpractice. As alleged in the complaint, the plaintiff retained the defendants to represent it in connection with the sale of certain real property and a related exchange of "like-kind property" pursuant to the Internal Revenue Code (see 26 USC § 1031). According to the allegations in the complaint, the plaintiff, based upon the defendants' advice, selected LandAmerica 1031 Exchange Services, Inc. (hereinafter LandAmerica), as the qualified intermediary to hold a portion of the sale proceeds, totaling $5.5 million, for the exchange of like-kind property pursuant to 26 USC § 1031. The complaint alleged, inter alia, that the defendants negligently represented the plaintiff inasmuch as they reviewed, and advised the plaintiff to execute, an agreement with LandAmerica, under which the exchange funds were to be held in a commingled account and not a qualified escrow account or trust. Soon after the sale proceeds were transferred to LandAmerica, its parent corporation, LandAmerica Financial Group, Inc., declared bankruptcy. According to the complaint, the plaintiff's funds were frozen for several years during the bankruptcy proceedings, and the plaintiff lost a portion of the funds because they were not held in a qualified escrow account or trust. The complaint further alleged that the plaintiff could not defer the taxes on the capital gains from the initial sale, as it did not have access to its funds to purchase a replacement property within the required 180-day period.
The defendant law firm failed to demonstrate that dismissal was appropriate
Here, construing the complaint liberally, accepting the facts alleged in the complaint as true, and according the plaintiff the benefit of every possible inference, as we are required to do, the plaintiff stated a cause of action to recover damages for legal malpractice (citations omitted) The plaintiff alleged in the complaint that the defendants were negligent in failing, inter alia, to advise it to keep its exchange funds in a qualified escrow account or trust, and that this negligence was a proximate cause of its damages. The defendants' contentions that it was the conduct of the plaintiff's manager and unforeseeable events that were the proximate causes of the plaintiff's damages, and that the defendants did not depart from the standard of care, concern disputed factual issues that are not properly raised and resolved on a motion to dismiss a complaint pursuant to CPLR 3211(a)(7).
Tuesday, July 2, 2013
Friday, May 10, 2013
The Connecticut Supeme Court has held that the litigation privilege provides absolute immunity to claims of fraud and intentional infliction of emotional distress brought by an unhappy litigant against opposing counsel.
The suit was brought by a former husband alleging fraud in the law firm's handling of post-dissolution proceedings concerning his ex-wife's financial situation.
The court concluded that a contrary reading of the law would open "floodgates" of litigation.
In the dissent, Justice Palmer calls the decision "out of step" with the majority of jurisdictions and "unduly protectionist of attorneys." (Mike Frisch)
Saturday, February 2, 2013
An Alaskan Native corporation entered into a fee agreement with a law firm in connection with litigation over "its certification of and title to certain lands" under the Native Claims Settlement Act.
The contingent fee agreement gave the law firm an interest in the lands at issue.
After the client had prevailed, a bar arbitration panel found that the firm could not take the land, but was entitled to a fee payment equal to the land's value. A 1995 court judgment enforced the arbitration award. The client paid the law firm for several years.
The client eventually was unable to continue the payments and litigation ensued.
The Alaska Supreme Court held that the contingency agreement violated provisions of the Act and that the arbitration award was improper. The court noted tht the case presented "complex" issues as to whether the 1995 judgment was void or voidable.
The court ordered the law firm to return $643,760 in paid fees.
The firm may now establish its entitlement for fees under quantum meruit. (Mike Frisch)
Friday, January 4, 2013
The Delaware Supreme Court has reversed a trial court order dismissing a slip-and-fall case because plaintiff's counsel had failed to provide the report of an expert witness.
The attorney had contended that the medical records were sufficient, notwithstanding a court order to provide a report.
The court here "readily under[stood] the trial court's frustration over counsel's cavalier attitude" and opined that plaintiff's attorney "wasted everyone's time, and should be personally sanctioned." However, the trial court was obligated to deal with the situation with methods short of outright dismissal of the case. (Mike Frisch)
Friday, December 28, 2012
The Kansas Supreme Court has held that a defendant in a probation revocation proceeding is entitled to the effective assistance of counsel.
The case involved allegations of a conflict in interest. The attorney who represented the defendant also served as the victim's guardian ad litem. He briefly noted the conflict in a proffer to the probation revocation court. No objections were lodged and the court did not conduct any inquiry.
The court here remanded for either a fresh revocation hearing with conflict-free counsel or a hearing into whether the conflict created an adverse effect on the representation. (MIke Frisch)
Tuesday, July 10, 2012
The web page of the Ohio Supreme Court has this announcement:
The Ohio Supreme Court will accept public comment until August 7 on a proposed rule that would permit military attorneys stationed in Ohio to represent lower-ranking service members in Ohio tribunals.
To be considered for the Expanded Legal Assistance Program (ELAP) for Military Attorneys, attorneys would need to meet these criteria:
- be admitted to practice in at least one other U.S. jurisdiction
- be employed by, serving in, or assigned to the armed services at an Ohio military installation
- and be authorized to provide legal assistance pursuant to 10 U.S.C. 1044.
Military attorneys seeking this status would need to file an application, submit certificates of good standing and admission, and provide an affidavit from their commanding officer with the Office of Attorney Services. They also would need to meet all the requirements governing the practice of law in Ohio, including continuing legal education requirements. ELAP attorneys would not be required to pay biennial registration fees under Gov. Bar R. VI and would be prohibited from seeking or receiving compensation for their services.
Access the text of the proposed changes to the Rules for the Government of the Bar of Ohio.
Comments should be submitted in writing to:
Susan Christoff, director, Attorney Services Division
Supreme Court of Ohio
65 S. Front St., Fifth Floor
Columbus, Ohio 43215
Saturday, July 7, 2012
The Utah Supreme Court has held that the judicial proceedings privilege applies to an attorney's course of conduct as well as to statements made in the course of litgation.
The law firm represented an employer who had sued a former employee for misappropriation of trade secrets and violation of a non-compete agreement. The firm sought and was granted a civil discovery court order authorizing its entry into the employee's home to seize electronic files from his computer and other electronic devices.
A firm attorney attended the execution of the order. The employee's fiancee (the employee was not there) objected. A second, ex parte order was obtained and she relented.
The employer-employee litigation settled. The employee did not raise the issue of the seizures in the litigation.
The employee then sued the law firm for on a variety of theories for the violation of his Fourth Amendment rights.
A lower court had applied res judicata principles based on the settled case and found the claims were barred.
Here, the court found res judicata inapplicable but nonetheless affirmed on the judicial proceedings privilege. The law firm had acted pursuant to a court order that had not been obtained by fraud or other improper means. (Mike Frisch)
Friday, June 15, 2012
From the Ohio Supreme Court:
Law firm letterhead and websites may list the names of non-lawyer employees if their status is clearly identified, according to a Supreme Court of Ohio Board of Commissioners on Grievances & Discipline advisory opinion.
Opinion 2012-2 departs from a previous advisory opinion issued by the board, so Advisory Opinion 89-16 is withdrawn.
The board’s 1989 opinion did not discuss law firms communicating with clients and the public via their websites. The opinion did, however, find that the inclusion of non-lawyers on letterhead was prohibited, but their inclusion on business cards was proper.
In revisiting its 23-year-old advice, the board considered Rules 7.1 and 7.5(a) of the Ohio Rules of Professional Conduct and the standard that “law firm letterhead and websites cannot be false or misleading, or contain a non-verifiable communication about a lawyer or the lawyer’s services.”
The board reiterated that firm business cards may identify non-lawyer employees.
Read the complete text of the opinion.
Monday, June 11, 2012
The New York Appellate Division for the First Judicial Department held that a plaintiff stated a valid cause of action under the following circumstances:
The following facts are undisputed: In 2002, plaintiff, a newly admitted
attorney, placed an advertisement in the New York Law Journal seeking a
mentorship opportunity with an experienced solo practitioner in order to gain
trial experience. Defendant responded to the advertisement and the parties met.
Subsequently, plaintiff saw an advertisement in the Journal placed by a Bronx
solo practitioner looking to refer cases out to other experienced attorneys.
Defendant met with the Bronx practitioner and agreed to act as trial counsel for
the Bronx attorney's clients with a 40% referral fee payable to the Bronx
attorney. It is further undisputed that plaintiff referred at least two cases to
defendant's law office, and that he conducted some depositions for cases on
which defendant was working, and drafted some bills of particulars — even though
plaintiff had not litigated any personal injury cases prior to meeting
defendant. Plaintiff received some payments from defendant which defendant
characterized as mostly for per diem work. Eventually, however, according to
plaintiff, the payments ceased.
In August 2006, plaintiff filed a summons and complaint alleging 10 causes of
action as follows: (1) breach of an oral partnership agreement; (2) breach of an
oral agreement; (3) fraud; (4) an accounting; (5) unjust enrichment; (6) fraud
in the inducement; (7) breach of fiduciary duty; (8) estoppel; (9) contract
implied in the law based on past performance; and (10) quantum meruit.
Plaintiff alleged, inter alia, that defendant had proposed that they should work
together as partners in a personal injury law practice with each having an equal
share of the profits gained from the cases they worked on jointly. Plaintiff
further alleged that between 2002 and 2005 he worked on more than 100 personal
injury cases for defendant, expended approximately 500 hours in connection with
these cases, and contributed $5,000 in capital to the partnership
The quantum meruit claim survives:
In the absence of a valid contract, plaintiff, however, does set forth a
prima facie case for recovery in quantum meruit. It is hornbook law that in
order to establish a claim in quantum meruit, a claimant must establish "(1) the
performance of services in good faith; (2) the acceptance of the services by the
person to whom they are rendered; (3) an expectation of compensation therefor;
and (4) the reasonable value of the services" (Soumayah v Minnelli, 41 AD3d 390, 391 ; see 22A NY Jur2d Contracts § 610;). Defendant agreed that plaintiff
worked for him in some capacity on a certain number of cases. Further, plaintiff
points to two e-mails purportedly sent by defendant to plaintiff in August 2005
acknowledging that defendant owes plaintiff certain fees on cases after they
"come to trial." Thus, plaintiff may recover based on quantum meruit for work he
performed without compensation on behalf of defendant.
Wednesday, January 18, 2012
The Idaho Supreme Court has held that a legal malpractice claim (and a related breach of contract claim) dies with the client.
Justice Horton dissents on the contract claim:
The majority expresses its concern that "[a] holding to the contrary would create a per se breach of contract action in every legal malpractice action." I would first note that this is a gross overstatement. The position I espouse only applies in instances involving express contractual undertakings. In this case, no one forced [the attorney] to enter into a contract prescribing the manner in which he would represent the client. Had he not elected to identify the manner in which he would perform his services, his duty to his client would be imposed by law, this action would sound in tort, and I would be joining with the majority.
I, too, have a concern for the result of this appeal. There is a very real concern that the decision of this Court will reinforce the perception, shared by many in our society, that courts will go out of their way in order to protect members of the bar. My position, which I believe to be well-grounded in existing law, simply recognizes that lawyers do not hold a special place in society that insulates them from the type of liability that any other party to a contract would face.
The claim involved allegations that the attorney failed to properly advise the client (who had been rendered a quadriplegic in an accident) of the effect of a settlement and release. (Mike Frisch)
Friday, January 13, 2012
The Nebraska Supreme Court has held that a law firm is liable to a court reporting service for the payment of fees for services.
The litigation involved services provided in five cases in a total amount of a tad below $6,000. The law firm had contended that their clients were the proper defendants. The court held that the firm was liable but not the contracting attorney as an individual under the particular facts.
The law firm had invoked agency law in support of its position.
The court responded:
As a practical matter, in today's legal system, an attorney dealing with those who provide legal support services acts less as an agent who relies on the client for authority to manage the case, and more as a "general contractor," who is responsible for supervising the various aspects of litigation. In that context, it is appropriate that the attorney, with superior knowledge and familiarity with the case and client, should bear the burden of clarifying his or her intent regarding payment. It is, in fact, a relatively simple matter foe an attorney to disclaim liability with a clear statement to that effect. And an attorney's liability for (and payment of) expenses of litigation is consistent with our ethical rules.
Tuesday, December 6, 2011
The New Jersey Supreme Court has refined the concept of "exoneration" for purposes of a criminal defendant's claim of legal malpractice against defense counsel.
The malpractice plaintiff was convicted of drug offenses in 1999. In October 2007, the conviction was reversed for ineffective assistance of counsel. In July 2008, the indictment was dismissed. Notice of a tort claim was served in November 2008. He then filed suit against the public defender.
The court here held that the suit was filed within the statute of limitations because the moment of exoneration was dismissal of the indictment, not reversal of the conviction. However, the lower court must determine whether the notice of tort claim was filed beyone the required 90 days as a result of "extraordinary circumstances." (Mike Frisch)
Wednesday, October 19, 2011
From the web page of the Ohio Supreme Court:
An advisory opinion recently issued by the Board on the Unauthorized Practice of Law of the Supreme Court of Ohio outlines the activities non-attorneys can and cannot engage in concerning Medicaid benefits.
According to Opinion UPL 11-01, non-attorneys may review documents, prepare and file Medicaid applications and attend state hearings on behalf of an individual “to the extent that those activities are authorized by federal law.”
The opinion draws the line for non-attorneys at performing “Medicaid planning” for current and prospective nursing-home patients and/or their families regarding qualification for Medicaid benefits “if it requires specialized legal training, skill, and experience.”
The opinion clarifies this point further.
“Medicaid planning, which consists of arranging assets and income to meet Medicaid eligibility requirements, is outside the scope of the non-attorney assistance permitted by federal law. State regulation of Medicaid planning is therefore not preempted by federal law. In many cases, Medicaid planning involves estate work and legal expertise. Accordingly, the board further concludes that the establishment of a Medicaid planning strategy for another by a non-attorney constitutes the unauthorized practice of law.”
A copy of the opinion is available at: http://www.supremecourt.ohio.gov/Boards/UPL/advisory_opinions/UPLAdvOp_11_01.pdf.
Tuesday, October 18, 2011
From the Ohio Supreme Court:
Out-of-state debt settlement lawyers are not authorized to provide legal services on a temporary basis to Ohio clients, according to a Supreme Court of Ohio Board of Commissioners on Grievances & Discipline advisory opinion.
It is the first time the board has addressed Professional Conduct Rule 5.5 (Unauthorized practice of law; multijurisdictional practice of law), which took effect in 2007.
Section (c) of the rule contains “safe harbors” that permit an out-of-state lawyer to provide legal services in Ohio temporarily.
Opinion 2011-2 applies the “reasonable relationship” factors found in the comments to Rule 5.5. The board concluded that allowing the multijurisdictional practice at issue would not serve the interests of clients and public when the “matters are not connected to the lawyers’ home state of admission, there is not a pre-existing relationship between the lawyers and the Ohio clients, and the lawyers do not have a recognized expertise in a particular body of federal, nationally-uniform, foreign, or international law that is applicable to the consumer debt matters.”
A copy of the opinion is available at: http://www.supremecourt.ohio.gov/Boards/BOC/Advisory_Opinions/2011/Op_11-002.pdf.
Wednesday, August 24, 2011
A new opinion from the District of Columbia Bar Legal Ethics Committee:
The principal question presented is whether a lawyer may ask his or her client’s treating physician not to have ex parte communications with opposing counsel in a medical malpractice case where legal restrictions on such communications based on privacy laws and/or physician-patient privilege have been removed.
Under D.C. Rule 3.4(f), the lawyer may inform his or her client’s treating physician that the treating physician has no obligation to speak with opposing counsel and that the treating physician may decline to speak to opposing counsel without the lawyer also present. To the extent that privacy laws or applicable privileges may restrict the scope of information that the treating physician may disclose, the lawyer may also demand that the physician comply with confidentiality obligations that have not been removed and may state his or her client’s position as to the scope of information that may be legally disclosed. The lawyer may not, however, request or instruct the physician not to have communications with opposing counsel or request or instruct that any communications take place only if the lawyer is present.
Saturday, July 9, 2011
A criminal conviction for two counts of rape and a count of misdemeanor theft was reversed by the Kansas Supreme Court as a result of misconduct on the part of the prosecutor. The court employed a two-step analysis of the misconduct and its consequences in determining that reversal was appropriate.
The prosecutor made reference during voir dire in at trial to the Stockholm Syndrome and other cases and later argued facts not in evidence:
More regrettably, the prosecutor's overall comments implied he was an authority on the Stockholm Syndrome and was capable of diagnosing an individual as suffering from this purported condition. He clearly was neither. Ironically, the [Patty]Hearst and Hornbeck cases the prosecutor discussed with the panel were two of those the journal authors studied before concluding: "No validated diagnostic criteria for 'Stockholm syndrome' have been described; existing literature is of limited research value and does little to support 'Stockholm syndrome' as a psychiatric diagnosis."
The prosecutor also made a comment in closing argument that the victim would remember the crime every time she took a shower. An objection was sustained and admonition given to the jury. The court found the remark improper and prejudicial.
The court reversed the Court of Appeals.
It is, I think, somewhat unusual for a claim of misconduct based principally on behavior during voir dire to result in a new trial. (Mike Frisch)
Thursday, May 26, 2011
The New York Appellate Division for the First Judicial Department affirmed the dismissal of tort claims against an Epstein Becker attorney and the firm in a suit claiming complicity in a co-defendant's theft of "personal and revealing photographs of plaintiff taken by her husband" to be returned only on payment of $2.5 million to settle claims of sexual harassment and retaliation.
The court concluded:
The allegations against the law firm and the individual attorney defendant also were correctly dismissed. The complaint contains, at most, wholly conclusory allegations that defendant Wigdor, the attorney for the other individual defendants, knew to be true what plaintiff's husband alleges to be true, that [co-defendant]] Pecile had stolen one of the two compact discs containing photographs of plaintiff after improperly viewing the contents of the discs. Regardless of how implausible Pecile's claim that she retained one of the discs inadvertently may be, at most the complaint implicitly alleges that Wigdor knew that Pecile's claim was false and that she in fact had stolen them, as plaintiff's husband claims. But any such implicit allegation is wholly conclusory.
Moreover, there is no allegation that Wigdor played the slightest role in any of the actions Pecile took to obtain possession of the discs and photographs in the first place. Of course, Wigdor knew that Pecile had no right to possess the photographs and, as is undisputed, he refused the demand of plaintiff's husband that they be returned immediately. Rather, Wigdor stated that he could not return the photographs because they were evidence of the alleged unlawful conduct of plaintiff's husband, as they indeed are if, as Pecile maintains, he committed the alleged conduct. About two months after the demand was refused, Wigdor turned the photographs over to a third party; he contends that neither he nor his firm ever had possession of the compact disc.
We need not determine whether Wigdor wrongly refused the unconditional demand for the immediate return of the photographs. Even if he should have acceded to the demand, the allegations in the complaint provide no basis for depriving him of immunity from liability "under the shield afforded attorneys in advising their clients, even when such advice is erroneous, in the absence of fraud, collusion, malice or bad faith" (citation omitted)...To the extent the complaint alleges fraud, collusion, malice or bad faith on the part of Wigdor, the allegations are wholly conclusory. If the shield does not deflect these allegations, it is so flimsy as to be of little use.
The court declined to impose costs. (Mike Frisch)
Tuesday, May 24, 2011
The Wisconsin Supreme Court reversed and remanded a case, concluding that a non-party had standing to raise disqualification of counsel but that the lower court improperly applied an "appearance of impropriety" test to the motion:
...to determine whether disqualification is required, a court must determine: (1) whether there was an attorney-client relationship and whether it has ceased; (2) whether the subsequent representation of another person involves the same or a substantially related matter; (3) whether the interests of the subsequent client are materially adverse to those of the former client; and (4) whether the former client consented to the new representation. In the instant appeal, it is undisputed that an attorney-client relationship had existed between the Cramer firm and Wayne Foster and the Foster Group and that the Cramer firm no longer represented Wayne Foster or the Foster Group at the time the slip-and-fall litigation began. Furthermore, no one asserts that the former clients (Wayne Foster and the Foster Group) have consented to the Cramer firm's representation of the plaintiffs in the present case...
We conclude that the circuit court applied an incorrect standard of law in disqualifying the plaintiffs' attorney, namely disqualifying the attorney on the basis of the "appearance of impropriety." Given the paucity of facts in the record relating to the attorney's prior representation of the Foster Group and Wayne Foster, we are unable to determine whether the two representations are substantially related such that the confidences of the Foster Group and Wayne Foster are implicated in this personal injury action or whether the current representation is materially adverse to the former client.
We cannot determine from the record before us whether the circuit court's order disqualifying the plaintiffs' attorney is erroneous when applying the correct standard. Accordingly, we reverse the order of the circuit court disqualifying the plaintiffs' attorney and remand the matter to the circuit court for such further proceedings as the circuit court determines are appropriate to resolve the question presented.
Justice Prosser (joined by Justices Ziegler and Gableman) concurred but
In reaching this result, however, the lead opinion engages in a lengthy review of Wisconsin cases and produces, in effect, a restatement of the law. It is this restatement of Wisconsin law on standing that triggers two concurrences and some angst.
To the extent that the lead opinion attempts to bring order out of chaos in our law on standing, it serves a constructive purpose. We all benefit when the court provides a clear restatement of the law. However, if the restatement changes the law while purporting simply to clarify it, it goes beyond the facts, effects a result that was neither requested nor briefed by the parties, and creates confusion among the bench and bar.