Scott P. Stolley 2017-12-20 21:34:17
In the 2016-17 term, the Texas Supreme Court was unusually active in deciding issues that directly affect lawyers. The court addressed contingent fees in In re Davenport, where the attorneys had an agreement to recover 40 percent of “the total sums recovered.” The court held this meant only 40 percent of the cash settlement and did not include 40 percent of the partnership interest that the client also received. In First United Pentecostal Church v. Parker, a lawyer absconded with money in the firm’s trust account. The client sued a second firm lawyer, whose only culpability was lying to cover up the embezzlement. The court held that the second lawyer was not liable for conspiracy and joint venture, since there was no evidence of an agreement to form either. But he could be liable for equitable relief under breach of fiduciary duty, which did not require a finding of causation. In Rogers v. Zanetti, a client sued the lawyer who had drafted an agreement for him and the lawyer who had defended a lawsuit about the agreement. The court held that the drafting lawyer’s alleged errors were rendered irrelevant by the jury’s finding of the client’s antecedent fraud. And the defending lawyer was not liable: (a) for failure to communicate a settlement offer, since there was no evidence the case would have settled; and (b) for not designating a rebuttal valuation expert, since there was no evidence that this likely caused an inflated verdict. The court held in In re National Lloyds Ins. that the defendant’s attorney-billing information was not discoverable. The court reasoned that en masse production of the insurer’s fee records would invade the work-product privilege, which is not waived merely by challenging the opponent’s fee claim. In Chavez v. Kansas City Southern Ry., the issue was whether the client was bound by a settlement signed by her lawyer. The court reversed a summary judgment against the client, holding that the railroad did not meet its summary judgment burden to prove conclusively that the client could not rebut the presumption that the lawyer had authority. In pending cases relating to law practice, look for the court to rule on: (a) whether client communications with a non-attorney patent agent are privileged (In re Silver); and (b) whether a lawyer with an unenforceable oral contingent-fee agreement can recover in quantum meruit (Hill v. Shamoun & Norman, LLP). Regarding discovery, the court issued a must-read opinion about electronic discovery. See In re State Farm Lloyds. The opinion emphasizes that all discovery is subject to a proportionality rule. The court also ruled that for a court to require a Rule 202 presuit deposition, the court must have jurisdiction over the potential lawsuit. See In re City of Dallas. The court issued two blockbuster insurance opinions. In Great Am. Ins. Co. v. Hamel, the insurer wrongfully failed to defend, and after an adverse judgment, the insured assigned its insurance rights to the plaintiffs. The court held that the insurer was not liable for the judgment because the trial was not “fully adversarial.” In USAA Texas Lloyds Co. v. Menchaca, the court issued an encyclopedic opinion discussing when the insured may recover policy benefits under a claim of statutory bad faith. Finally, the court continued its fascination with the anti-SLAPP statute, deciding four cases. The court ruled in one that even private statements are covered by the statute when they involve a matter of public concern (ExxonMobil Pipeline Co. v. Coleman), in another that the plaintiff did not present clear-and-specific evidence of damages (Bedford v. Spassoff), and in another that the defendant could invoke the statute even while denying having made the statement (Hersh v. Tatum). The fourth case (D Magazine Partners, L.P. v. Rosenthal) is most notable for the court’s discussion of using Wikipedia as an authority. Look for the court to decide three more anti-SLAPP cases in the current term. SCOTT P. STOLLEY practices at Stolley Law in Dallas. He is certified in civil appellate law by the Texas Board of Legal Specialization
Published by State Bar of Texas. View All Articles.
This page can be found at http://mydigimag.rrd.com/article/Texas+Supreme+Court/2967609/463027/article.html.