Justia Professional Malpractice & Ethics Opinion Summaries

The trial court granted summary judgment to Defendants-Appellees Seymour Law Firm, R. Thomas Seymour and Scott A. Graham, based on the legal theory that its failure to enforce an attorney's lien within one year after it became aware of a settlement precluded Plaintiff-Appellant Gina Cowley from enforcing a contract she held with co-counsel. Specifically, the issue before the Supreme Court was whether the expiration of the lien prohibited Plaintiff's lawyer from suing her co-counsel for breach of contract over the distribution of attorney fees from the settlement of the underlying case. Upon review, the Court held that the applicable one-year statute of limitations did not preclude a lawsuit arising over a contract dispute between Plaintiff's lawyers. The case was reversed and remanded for further proceedings. View "Cowley v. Seymour Law Firm" on Justia Law

In 2006, Plaintiff Laurie Jenkins entered into a contract with Chet Medlock for the sale, transfer and delivery of a metal building. The purchase price was to be paid in three equal installments. After the building was completed, issues arose regarding the quality of work. Plaintiff contacted Defendant Larry Starns who wrote a letter to Medlock on her behalf, pointing out several complaints Plaintiff had with the building. Medlock sued Plaintiff for breach of contract; she was personally served. Defendant was in contact with Medlock's attorney, and believed there was an informal agreement for an extension of time to file responsive pleadings. When no answer was filed, Medlock obtained a default judgment against Plaintiff. Plaintiff notified Defendant of the judgment, to which he filed a petition to annul the judgment. Medlock responded arguing insufficiency of service and improper venue. Neither Plaintiff nor Defendant made an appearance at court. The trial court subsequently dismissed Plaintiff's suit. Ultimately the court issued a judgment of garnishment against Plaintiff's bank account. Plaintiff filed suit against her attorney alleging legal malpractice, which she lost. Upon review of the record, the Supreme Court concluded that the trial court and court of appeal erred in applying the "continuous representation rule" to suspend the commencement of the one-year peremptive period in La. R.S. 9:5605 until Defendant's efforts to remedy his negligence had concluded. The court of appeal's judgment was reversed. View "Jenkins v. Starns" on Justia Law

Patricia Shelton filed suit alleging breach of contract a legal malpractice against her former attorneys Defendants-Appellants R. Bruce Owens, Jeffrey Crandall, and Owens and Crandall, PLLC (Owens). During the pendency of her action, Ms. Shelton passed away. Plaintiff-Appellee Lois Bishop sought to assert Ms. Shelton's claims as her personal representative. Owens unsuccessfully argued that the legal malpractice claim abated upon Ms. Shelton's death, and that her breach of contract claim did not state a claim. Owens appealed. Because Patricia Shelton’s legal malpractice claim sounds in tort and abated upon her death, and her breach of contract claim fails to state a claim, the Supreme Court concluded the district court erred in denying Owens’s motion for summary judgment and in granting Bishop’s motion to substitute as plaintiff. View "Owen v. Bishop" on Justia Law

SSW Holding filed a complaint against BDO Seidman and other defendants, asserting several causes of action and seeking damages arising from a tax-advantaged investment strategy involving investments in distressed debt that SSW entered into and utilized on its federal tax returns for the 2001-2005 tax years. BDO filed an amended motion to compel arbitration and stay the motion, asserting that it and SSW entered into two consulting agreements that provided for arbitration before the American Arbitration Association. The circuit court denied the motion. The Supreme Court reversed, holding (1) SSW's claims fell within the scope of the arbitration provisions; and (2) the circuit court erred in finding that the arbitration provisions were unenforceable and invalid due to fraud and procedural and substantive unconscionability. Remanded. View "BDO Seidman, LLP v. SSW Holding Co." on Justia Law

Trinity Mortgage Companies, Inc. (Trinity) appealed the district court’s order granting summary judgment in favor of David Dryer and Dryer and Associates, P.C. (Dryer). Trinity, formerly a mortgage brokerage company owned by Shawn Cremeen, entered into a franchise agreement with 1st Class Lending, Inc., which was owned by Dennis Junker and Richard Gheisar. In April 2007, Junker sued Gheisar and Trinity in Oklahoma state court for breach of contract, fraud, defamation, and conversion, all concerning his alleged wrongful termination. Between May 2007 and April 2008, Dryer represented Trinity, without a written contract. In October 2007, while the lawsuit was pending, Trinity entered into an agreement to sell most of its assets and to stop originating loans. Meanwhile, after Trinity failed to file an answer in the pending lawsuit, Junker moved for a default judgment against Trinity. Because Dryer failed to object to entry of default judgment against Trinity, the state court granted the motion against Trinity in January 2008. The another firm replaced Dryer as Trinity’s counsel, who unsuccessfully sought to vacate the default judgment against Trinity. Cremeen and Junker eventually entered into a settlement agreement concerning the lawsuit. Trinity confessed a final judgment in favor of Junker but the only recovery of this amount would be through his ownership interest in Trinity, which was the action against Dryer. Trinity moved for partial summary judgment on its malpractice and breach of contract claims. Dryer moved for summary judgment, contending that all claims were barred as a matter of law because Trinity unlawfully assigned them to Junker. In response, Trinity argued that there had not been an assignment of tort causes of action; there was never any collusion between Trinity and Junker; and that the malpractice case was not contingent upon disproving the merits of the underlying suit against Trinity. The district court granted Dryer’s motion for summary judgment and denied Trinity’s motion for partial summary judgment. Upon review, the Tenth Circuit concluded that the district court properly granted summary judgment in favor of Dryer. View "Trinity Mortgage Companies, Inc. v. Dryer" on Justia Law

DTC filed a complaint with the Court of Chancery against the Union and Harry Bruckner, a para-transit driver, in the nature of a declaratory judgment action (Complaint) pursuant to Title 1, Chapter 65. The Complaint sought an order vacating or modifying a labor arbitration award issued by a certain arbitrator pursuant to a collective bargaining agreement between DTC and the Union. The award reinstated Bruckner, who was terminated by DTC, with back pay less interim earnings. The Court of Chancery granted the Union's motion for summary judgment. DTC's sole argument on appeal was that the arbitrator's decision should be vacated due to the appearance of bias or partiality on the part of the arbitrator. The court held that the alleged bias or partiality which DTC attributed to the arbitrator failed to meet the "evident partiality" standard where the mere fact that an arbitrator may share a personal life experience with a party or a party's agent was legally insufficient to constitute a substantial relationship that a reasonable person would conclude was powerfully suggestive of bias. Accordingly, the judgment was affirmed. View "Delaware Transit Corp. v. Amalgamated Transit Union Local 842" on Justia Law

This case involved a dispute over earn-out payments related to a merger between Viacom and Harmonix where plaintiff was one of the selling stockholders of Harmonix. Plaintiff sued on behalf of the selling stockholders, alleging that Viacom and Harmonix purposefully renegotiated the distribution contract with EA so as to reduce the earn-out payments payable to the Harmonix stockholders, and thus breached the covenant of good faith and fair dealing implied in the Merger Agreement. The court dismissed plaintiff's claim and held that it would be inequitable for the court to imply a duty on Viacom and Harmonix's part to share with the selling stockholders the benefits of a renegotiated contract addressing EA's right to distribute Harmonix products after the expiration of the earn-out period. View "Winshall v. Viacom Int'l, Inc., et al." on Justia Law

Ernie and Karen Cline sued M. Jay Carter for breach of contract after Carter signed a real estate contract with the intent to purchase residential property from the Clines but was unable to do so because he failed to obtain financing approval. Carter filed a third-party complaint against the real estate agent and company that represented him in the transaction (Jones Defendants). The circuit court consolidated the two lawsuits for trial. The jury returned a verdict (1) against Carter and in favor of the Clines on their breach of contract claim, and (2) against the Jones Defendants and in favor of Carter on Carter's negligence claims. The Supreme Court reversed, holding that the circuit court erred by denying Carter's motion for a directed verdict and his subsequent motion for judgment notwithstanding the verdict because there was a condition precedent included in the real estate contract that required Carter to obtain financing for the purchase, which he was unable to do, and as a result, there was no contract. Remanded. View "Carter v. Cline" on Justia Law

Plaintiff Darrell Kasberg farmed piece of property leased from the Wheelers. The Wheelers agreed to loan Plaintiff money, using farmland he owned as collateral. When disagreements arose, the Wheelers threatened to evict Plaintiff from both his land and the leased land. On the day of the eviction trial, Plaintiff told his lawyer from Defendant firm Davis Wright Tremaine, LLP that he would be willing to give up his right to repurchase the leased farmland if the Wheelers would remove a crop lien placed on the land in time for him to meet a planting deadline. Plaintiff's lawyer met with the Wheelers' lawyer and they negotiated an oral settlement agreement. Plaintiff was not present at that meeting. The agreement required (amongst other things) that Plaintiff relinquish any interest or claim of interest in, and surrender possession of his collateral farmland. In exchange, the Wheelers agreed to dismiss their breach of contract action and to remove the lien. Plaintiff would later learn and inform his lawyer that the Wheelers had not removed the lien. This resulted in Plaintiff missing the planting deadline, and he lost an opportunity to receive both money from the sale of the crop and related government subsidies. Plaintiff wished to file an suit against the Wheelers for their handling of the crop lien, and approached his lawyer to handle the case. Though his lawyer lead Plaintiff to believe he would be successful in pursuit of the Wheelers, the lawyer had in reality given bad advice with regard to the statute of limitations that governed Plaintiff's suit. Plaintiff then initiated suit against his former lawyer and Defendant firm, alleging legal malpractice in handling the Wheeler lien dispute. The trial court decided that the facts did not present a genuine issue as to whether Plaintiff knew or should have known before he filed his action, that Defendant had negligently negotiated the oral settlement agreement. The court concluded that Plaintiff's action was thus time-barred. Upon review, the Supreme Court concluded Plaintiff proffered evidence from which a jury could reasonably find that he did not have actual knowledge that his attorney's acts or omissions were a cause of his damages. As such, the Court reversed the trial court's holding and remanded the case for further proceedings. View "Kaseberg v. Davis Wright Tremaine, LLP" on Justia Law

Appellants brought various claims before Financial Industry Regulatory Authority (FINRA) arbitrators against Ameriprise, a financial-services company, for, inter alia, breach of fiduciary duty, breach of contract, fraud, and negligent misrepresentation related to the decline in value of various financial assets owned by appellants and managed by Ameriprise. Ameriprise answered appellants' FINRA complaint by asserting, principally, that appellants released their claims by operation of a settlement agreement in a class-action agreement suit that had proceeded between 2004 and 2007 in the United States District Court for the Southern District of New York. After FINRA arbitrators denied Ameriprise's motion to stay appellants' arbitration, Ameriprise moved in the district court, in which the class action had been litigated and settled, for an order to enforce the settlement agreement that would enjoin appellants from pressing any of their claims before FINRA arbitrators. The district court concluded that the class settlement barred all of appellants' arbitration claims and therefore granted Ameriprise's motion and ordered appellants to dismiss their FINRA complaint with prejudice. The court held that the district court had the power to enter such an order and that several of appellants' arbitration claims were barred by the 2007 class-action settlement. Therefore, the court affirmed in part. But because the court concluded that appellants' arbitration complaint plead claims that were not, and could not have been, released by the class settlement, the court vacated in part the district court's judgment, and remanded the case for the entry of an order permitting the non-Released claims to proceed in FINRA arbitration. The court dismissed as moot appellants' appeal from the district court's denial of their motion for reconsideration. View "In Re: American Express Finance Advisors Securities Litigation" on Justia Law