Justia Legal Ethics Opinion Summaries

Charles Breland was a developer of real property, with properties in Alabama and Florida. In 2002, Breland hired David Hudgens to provide legal services for him and his companies. According to Hudgens, Breland informed him early during their professional relationship that he "was suffering significant cash flow problems." As a result, Hudgens says, the various law firms with which Hudgens worked while providing Breland and his companies with legal services delayed billing "a significant portion of the attorneys' fees and costs" for those services. Breland disputed that, claiming that he and/or his companies paid Hudgens more than $2.7 million for Hudgens's legal services between 2004 and 2010. In 2009, Breland filed a Chapter 11 bankruptcy petition. Breland filed the required schedules, required disclosure statement, and a proposed plan of reorganization that identified Hudgens & Associates, LLC ("H&A") as an unsecured creditor holding a $1 million claim and identified ETC as an unsecured creditor holding a $390,000 claim. Hudgens filed a proof of claim in the Breland bankruptcy on behalf of H&A for "legal fees" in the amount of $2,334,987.08 and filed proofs of claim on behalf of ETC for "guaranty of note" in the amounts of $879,929.55. Breland did not make payments according to the bankruptcy reorganization plan. Breland conveyed property to Gulf Beach Investment Company of Perdido, LLC which Hudgens alleged was in violation of the reorganization plan. Hudgens filed suit against Breland and Gulf Beach seeking enforcement of the plan, monies owed under the plan, and to void transfer of the property to Gulf Beach. The trial court entered a judgment on the parties' motions for a partial summary judgment, noting that it was not addressing the plaintiffs' "mortgage claim" because it had denied that claim in a September 2015 order. After setting forth extensive findings of fact and conclusions of law, the trial court awarded the plaintiffs $2,189,342.96 (consisting of $1.5 million in principal, plus interest); "denied and dismissed" the defendants' fraud, breach-of-contract, and slander-of-title claims; and certified the judgment as final pursuant to Rule 54(b). The trial court denied the defendants' postjudgment motion, and the defendants appealed. That case was assigned case no. 1150876, and the Alabama Supreme Court consolidated case nos. 1150302 and 1150876 for the purpose of writing one opinion. After review, the Court dismissed both appeals, finding the trial court exceeded its discretion in certifying as final the underlying appeals. View "Equity Trust Co. v. Breland" on Justia Law

Myron Yarbrough appealed a circuit court judgment entered against him in his action alleging legal malpractice against Steven Eversole, Richard Perry, Jr., and Eversole Law, LLC ("the firm"). In 2006, Yarbrough was convicted of one count of first-degree rape and two counts of first-degree sodomy. The trial court sentenced him to life imprisonment for each conviction and ordered that the sentences were to run concurrently. Yarbrough appealed to the Court of Criminal Appeals, which affirmed his convictions and sentences in an unpublished memorandum. At the time of the events giving rise to Yarbrough's cause of action, the firm employed both Eversole and Perry. In March 2012, Yarbrough retained the firm to explore the possibility of filing a Rule 32, Ala. R. Crim. P., petition on Yarbrough's behalf. Yarbrough alleged that Eversole and Perry represented to Yarbrough that "there was a basis in fact and law to file a Rule 32 petition." Yarbrough asserted, however, that the two attorneys "knew that there was no 'newly discovered' evidence as defined by Alabama case law and that the statute of limitations would be a complete bar to all claims of newly discovered evidence and for the claim of ineffective assistance of trial counsel and appellate counsel." Yarbrough paid the firm $10,000 to file a Rule 32 petition on his behalf. The claims in that Rule 32 petition were ultimately denied as time-barred. Yarbrough filed this legal malpractice action against the firm, alleging that they misrepresented his chances of success in the Rule 32 petition. After review, the Supreme Court found that circuit court erred in concluding that Yarbrough's legal-malpractice action against the firm and Eversole failed as a matter of law. However, there existed a plain dispute of fact as to what Eversole told Yarbrough about the prospects of a Rule 32 petition and the subsequent appellate filings. Therefore, a judgment on the pleadings in favor of the firm and Eversole was not warranted. The summary judgment in favor of Perry was affirmed, but the judgment on the pleadings in favor of the firm and Eversole was reversed and remanded for further proceedings. View "Yarbrough v. Eversole" on Justia Law

Todd Hill, Roy Hill, Brian Hill, and Debra Hill Stewart were the children of Leroy Hill, who died testate in 2009. Deborah D. Hill, Leroy’s second wife, offered Leroy's will for probate. The Hill children hired attorneys Vincent Kilborn III and David McDonald to bring a breach-of-contract action against the estate and Deborah, alleging breach of an agreement between Leroy and the Hills' mother at the time Leroy divorced the Hills' mother in 1984 to make a will leaving the Hills a coffee company and a family ranch. The Hills and the attorneys entered into a retainer agreement, which required the Hills to pay the attorneys "40% of any recovery, in the event there is a recovery, with or without suit." According to the agreement, "recovery" included cash, real or personal property, stock in the Leroy Hill Coffee Company, and all or part ownership in the family ranch. After a trial, a judgment was entered for the Hills ordering specific performance of the contract, which required the conveyance of the coffee company and the ranch to the Hills. The Alabama Supreme Court affirmed the trial court's judgment, without an opinion. At issue before the Supreme Court involved the attorney fee. The Supreme Court found that the circuit court exceeded the scope of its discretion when it failed to order the payment of the attorney fee in accordance with the retainer agreement. The Hills petitioned for a writ of mandamus to direct the circuit court to vacate two order for lack of subject-matter jurisdiction. Specifically, they argued that the circuit court did not have jurisdiction to determine the 40% contingency fee owed the attorneys was an administrative expense of the estate and, consequently, that the circuit court did not have subject-matter jurisdiction when any subsequent order at issue in this case. The Supreme Court concluded the circuit court had jurisdiction over the administration of the estate, so the petition for a writ of mandamus (case no. 1150162) was denied; the orders pertaining to payment of the retainer were reversed (case no. 1150148) and the matter remanded for further proceedings. View "Hill v. Kruse" on Justia Law

Juakeishia Pruitt filed a legal-malpractice claim against Bobby Cockrell, Jr., and Cockrell & Cockrell ("the Cockrell law firm"). Cockrell appealed the grant of summary judgment in favor of Pruitt. The claims in this case arose from Byron House's representation of Pruitt from late 2000 until January 2012. House worked as an associate with the Cockrell law firm from September 1995 until January 2012. This case involved House's handling of Pruitt's claims with regard to four separate causes of action: Pruitt's discrimination and breach-of-contract claims against Stillman College; Pruitt's sexual-discrimination claims against her employer Averitt/i3; Pruitt's claims against Gwendolyn Oyler arising from an automobile accident; and Pruitt's breach-of-contract claims against A+ Photography. After the statute of limitations had run on Pruitt's underlying claims against Stillman College, Averitt/i3, and Oyler, House made intentional misrepresentations to Pruitt regarding the status of those cases. House also made intentional representations regarding the status of Pruitt's case against A+ Photography. Additionally, House continued to make such representations regarding the status of Pruitt's cases against Stillman College and Averitt/i3 until well after the time any legal-malpractice case against him would have been barred by the applicable statute of repose. "A fraud committed by an attorney that defrauds the attorney's client as to the status of the client's underlying claim is actionable under the ALSLA separate and apart from the attorney's failure to timely file a complaint on the underlying claim." Therefore, Alabama Supreme Court concluded the trial court properly denied the Cockrell defendants' motion for a summary judgment as to the malpractice claims alleging that the Cockrell defendants were vicariously liable for fraudulent misrepresentations House made to Pruitt to conceal the existence of an underlying legal-malpractice claim. Accordingly, the Court affirmed the trial court's order. View "Cockrell v. Pruitt" on Justia Law

Richard Watters petitioned the Alabama Supreme Court for a writ of mandamus to direct the Mobile Circuit Court to vacate its order denying his motion for a summary judgment as to count one of an amended complaint filed by Michael Gamble, in Gamble's capacity as administrator of the Estate of Barbara Ruth Findley Long ("Long"), deceased. Count one asserted a legal-malpractice claim against Watters under the Alabama Legal Services Liability Act ("the ALSLA"), alleging breach of a fiduciary duty. This proceeding involved title to real property located in Conecuh County, which was owned by Robert Findley at the time of his death. Long retained Watters & Associates, of which Watters was a partner, to represent her "in obtaining estate assets" of Findley, her deceased father. Watters filed suit seeking a declaration of Long's ownership in family property located in Conecuh County. The Circuit Court declaring that Long owned a one-sixth interest (approximately 30 acres) in the Conecuh County property Shortly thereafter, Long discharged Watters from any further representation in the declaratory-judgment action. Watters filed an attorney's lien against the Conecuh property to secure the payment of his attorney fees. Family members eventually quitclaimed their interests to Long. Taxes for 2006 weren't paid on the property, and Long's cousin Larry Findley purchased the property at a tax sale. According to Watters, Long asked him for a loan to redeem the property from the tax sale. Watters told Long that Langley would not record the quitclaim deed if Long repaid the loan within 30 days of redeeming the property; that, in the event the deed was recorded, any claim Watters might have against Long for services rendered regarding her deceased father's estate would be satisfied; and that Watters and Long agreed to terms concerning the loan arrangement. This arrangement was never reduced to writing. Long executed a quitclaim deed prepared by Watters, conveying title to the Conecuh property to "Langley & Watters, LLP." In 2010, Watters submitted to the Conecuh Probate Court a letter, enclosing "his client's" application for redemption of the Conecuh property. Long died on April 2, 2013, and a few months later, the Conecuh Probate Court appointed Gamble as administrator of Long's estate. Gamble filed a complaint against Watters, asserting claims of legal malpractice among other things. After review of this case, the Alabama Supreme Court concluded that Watters had another adequate remedy (i.e., an appeal) other than a writ of mandamus. Therefore, the Court denied relief. View "Ex parte Richard L. Watters." on Justia Law