How Not to Draft a Contract, And, The Relationship Between Contract and Quantum Meruit

Phillips v. Adams, Jordan & Herrington PC, Court of Appeals of Georgia, A19A0159, May 22, 2019 is one of those ‘what were these smart and well-trained people thinking’ cases.  Everyone involved in this case is an attorney, and one of them (the Plaintiff) is also a medical doctor.  When Phillips (the Plaintiff) went to work at the Defendant law firm, they were all smart enough to put the compensation in writing:  “[Y]our compensation . . . will be production based and outcome determinative . . . you will be paid upon successful resolution of the cases in which you are involved. Your portion of the fee will depend on the extent of your work on the case and will be determined on a case by case basis.”  When some contingency cases provided income, there was – shockingly – a dispute over payment, and Phillips sued in contract and quantum meruit.  Law firm sought and received summary judgment on both counts.

Phillips appealed.  The trial court granted summary judgment on the contract claim on the ground that the contract – shockingly – “was too indefinite to be enforced.”  On appeal, Phillips urged that the contract contained “a formula for calculating compensation.”  However, the court looked to the fact that if there were a formula, it was partial at best; the there was discretion by others to calculate; that the agreement contained no method to value his work; and other facts in concluding that the agreement was too vague.  Important supporting authority:  Arby’s, Inc. v. Cooper, 265Ga. 240, 241 (454 SE2d 488) (1995); Jackson v. Ford, 252 Ga. App. 304, 306-307 (1) (a) (555 SE2d 143) (2001). Summary judgment on the contract count was affirmed.

However, summary judgment as to quantum meruit was reversed.  The trial court had reasoned that because there was a contract, that there could be no quantum meruit claim.  Though that principle can be used to cut off recovery when a party seeks to use quantum meruit to exceed the amount agreed to under a contract, it is not available when the contract fails. The court cite a market basket of cases for the proposition that when a “contract between the parties is void for vagueness, quantum meruit is appropriate to compensate a party that provided a benefit to the other party associated with the failed agreement.”

Useful case to have, both for its internal cites, and as an example of poor drafting that a bunch of lawyers thought was good drafting.

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The Most Possible Things A Case Can Hold In Thirty Seven Double Spaced Pages

Alliant Tax Credit 31 v. Murphy, 11th Circuit, No. 15-14634, May 15, 2019 is a judicial tour de force in which the Eleventh Circuit, while dealing with the otherwise mundane subject matter of fraudulent transfers, made over a dozen distinct procedural and substantive procedural and substantive holdings.  If you ever want to cite this case, and you check cases that cite it, that means about 90% of those cases will concern a totally different subject.  For the purposes of this summary, all you need to know is that it is a fraudulent transfer case with a very twisted procedural history.  Here’s what it contains, there’s something for everyone here:

  1. When the defendant pays a judgment during an appeal, it does not moot the appeal.
  2. The citizenship of LLCs, and partnerships, for diversity purposes, counts all its members and partners.
  3. The citizenship of a traditional trust is where the trustee is.
  4. Diversity jurisdiction may be proven by the preponderance of the evidence.
  5. A district court’s decision to admit affidavits on personal jurisdiction is subject to abuse of discretion review.
  6. A district court’s decision to deny discovery on personal jurisdiction is subject to abuse of discretion review.
  7. The domestic relations exception to diversity jurisdiction only applies to divorce, alimony and child custody issues.
  8. A divorce proceeding does not create collateral estoppel with respect to property distribution against a nonparty who asserts a fraudulent transfer claim.
  9. A fraudulent transfer claim is not an impermissible collateral attack on a divorce property order.
  10. If two parties hold a judgment jointly, both are not necessary parties to a collection suit.
  11. The burden of proof under the Uniform Fraudulent Transfer Act (“UFTA”) is preponderance of the evidence.
  12. Under UFTA, compensatory damages are not required to support a punitive damages.
  13. Prejudgment interest is, for the most part, not recoverable from a transferee under UFTA.

And the thing is, I left out some of the sub-sub-holdings.  So much going on.  Look it up.

Court Weighs Evidence, Reverses Premises Liability Summary Judgment Denial

Brown v. Dickerson, A19A1015, Georgia Court of Appeals, May 13, 2019,  is a fundamentals case.  If your practice involves premises liability, I am sure nothing I will write here will be earth shattering.  However, to those that don’t slip and fall into this area of the law often, a refresher course is always nice.  More interesting, though, is the weighing of the evidence done in a context where evidence is supposedly never weighed.

Brown’s friend, Rogers, had a birthday party at Brown’s house.  Rogers invited her friend, Dickerson, to the party. Brown did not know Dickerson.  Dickerson fell while walking down exterior brick stairs.  Later. Dickerson believed she saw an orange extension cord on the stairs, and surmised that it caused her fall.  Brown testified that he did not put a cord there, and that earlier in the day he had completed yard word – all with non-electric tools – and made sure the yard was clear. He also testified that there was no cord there when the party started. Thus, there was no direct evidence that Brown either put the cord there or knew of it being there. Brown moved for summary judgment; the trial court denied the motion (but certified it for review), and Brown appealed.

The Court of Appeals reversed.  First, the court noted that as a social guest, Dickerson was a licensee, as opposed to an invitee.  Then, the court stated the standard of care: “A property owner owes a more narrow duty to licensees not to injure them willfully or wantonly.“  The court defined willful and wanton  but summed up the need for a plaintiff as follows:  “licensee must come forward with evidence that property owner knew or had reason to know of dangerous condition that caused licensee’s injury.”

The court proceeded to weigh the evidence and decide that Brown was entitled to summary judgment. Yes, I know we all like to say that courts don’t weigh evidence on summary judgment motions, but they do, and they do it fairly often.  The court first noted that Brown’s evidence was “direct” and Dickerson’s was “circumstantial.”   That made Brown’s evidence better.  (See, that’s weighing.)  But Dickerson’s circumstantial evidence would be just fine, if it met certain standards (again, weighing).  The standard for this weighing:  “a finding of fact which may be inferred but is not demanded by circumstantial evidence has no probative value against positive and uncontradicted evidence that no such fact exists…for an inference drawn from circumstantial evidence to be sufficient to create a genuine issue of fact precluding summary judgment, it must be reasonable and must amount to more than mere speculation, conjecture, or possibility .”  Sounds like a jury instruction to me.

For what it’s worth, if you really want to see some fact-weighing at the summary judgment state, look up civil conspiracy allegations.

CLE: The Fourth Year of Law School

Introduction:  The Fourth Year

A lawyer who has been practicing thirty or so years has completed four years of law school.  Three of those years were consecutive before beginning practice. The fourth year was stretched out, 12-16 hours of CLE per year, over that 30-year period.  I am at that point and realized that – thirty years later – although I can pretty much describe what each year of law school provided, the same cannot be said for my extended fourth year.  I decided to examine whether, if I had a chance to re-do that fourth year, would I do anything differently.  (Advance disclosure: 9% of this piece involves some marketing, and it is all in the last paragraph.)

My Fourth Year: Typical Enough for Discussion

I began my fourth year pretty much the same as everyone else did – my state bar’s “Bridge the Gap” program.  This program, supposedly, would enable the recent law school graduate – simply by sitting in a hotel ballroom for three days – to convert all that law school knowledge and all that bar exam knowledge into tools for practice.  I am certain I picked up something there beyond the two years of CLE I received, but, I am fairly certain that I never said to any partner I worked with back then “that’s not what they taught us in Bridge the Gap.”

The next part of my fourth year involved day-long or two-day long seminars, mostly put on by the “official” CLE provider, in my area of practice.  Though some of these were wonderful, and some were terrible, the pattern was simple.  Over an eight-hour period, you’d get about 3 ½ hours of subject matter about which you cared; 3 ½ of other subject matter, and one hour of someone either reading Bar rules, or telling you that lawyers should be nicer to each other.  More than half the speakers at these programs would read or track their written materials.  You’d get your 8 hours; you’d get an ethics/professionalism hour; and you’d walk away with a nugget or two, but, if you chose to read articles for an hour in the office, you’d get just as much. The “area of expertise” phase of the fourth year ended, for me, when I came to the realization that many panelists were either opposing or co-counsel, telling me about a brief I either wrote, or read, and the learning had basically disappeared.

Next, I decided to take some electives.  For a few years, my thought was, as the cost/benefit thing would not work in my own practice area, I could at least pick up some basic knowledge outside of my field.  This resulted in my bookshelf picking up clutter on things like family law and DUI.  Kept my interest longer than the in-field seminars did but did not result in any profitable knowledge.

By this point in the timeline, two things had happened to make getting the hours easier.  First, I had generated enough expertise and enough of a good reputation that I was included on at least one CLE panel a year.  That inclusion provided both attendance credit and speaker credit.  Second, I started coaching mock trial at a high school, which gave three hours of credit (including, if I recall correctly, a professionalism credit) in exchange for the hundred or so hours I put in.  Though I have since “dropped” mock trial, the speaker hours and seminar attendance have been doing the job. The seminar attendance strategy is still rife with challenge.  My current set piece is an ethics/professionalism piece, which can be put into any program, so I find myself sometimes in places where the knowledge imparted is not necessarily the most useful.

The last type of CLE that made up my fourth year was “forced” CLE.  At least part of my fourth year involved time learning on a weekend the next big thing that someone with extreme power in a firm thought it was important for everyone to know. This category also includes the “suggestion” that you hear your boss speak at a seminar.

(One type of CLE which I never took and will not discuss here, but is worth mentioning, is “destination” CLE – where you go to the mountains, the ski resort, the islands, etc. and get a couple of hours a day on a four day CLE junket. That’s on a wholly different continuum.)

Ranking My Experiences

When I look at this “year” of law school and examine which parts stand out from a cost/time/usefulness perspective, the rankings are almost self-evident.

Tier One:

  1. Mock trial coaching. You want to know evidence, and how to argue objections, and how to write a cross or direct?  Spend 12 weeks teaching high school students how to do these things and hone those skills.  Nothing else on this list is even close.
  2. Those portions of any seminar combining three things (a) my lack of knowledge of the subject; (b) the immediacy of my need for the new knowledge; and (c) a knowledgeable speaker who was also a good presenter.
  3. Speaking creates a deep knowledge of a subject; updates are constant; and you get your thoughts vetted by a roomful of lawyers. There’s a secondary business generation component as well.

Tier Two:

  1. The “electives,” so long as some more-than-minimum standard of speaker knowledge and quality was met.
  2. Bridge the Gap.

Tier Three:

  1. Those portions of longer seminars that I had to sit through in order to get the content I really wanted to get.
  2. Instances where speakers told me what I already knew.
  3. “Forced” CLE.

Reexamining Choices: What if I Could Go Back to Law School and Choose Different Classes

Though I cannot go back in time, I could certainly offer guidance to newer lawyers, or lawyers who do not get their hours by speaking.

First, avoid – unless “forced” – long CLE experiences where the subject you want is outnumbered by subjects you do not want.  That will of course be different at different points in a career, but in terms of benefit, it’s sort of like buying a new phone to get a new USB cord.

Second, and this goes along with the first, make sure that any CLE you choose meets your level of knowledge.  If you’re new to a subject, then the existence of words like “introduction to,” “the basics of,” and “what every lawyer should know about …” are fine.  But if you know the field, that’s wasted time.

Third, speakers matter.  Some CLE speakers are knowledgeable and good presenters.  However, most panels include three other types of speakers:  speakers trolling for business; speakers on the panel because they are friends with the panel’s organizer; and, speakers who were the only ones available on that date with arguable expertise.  Vet your speakers before paying money to hear them.  Every other purchase decision you make in life probably involves prior knowledge and research; this one should too.

Fourth, variety is the spice of life.  If you are not filling up hours in large blocks (see “First”) then you can take an hour or two every year to learn something new.

Fifth, you can learn by teaching, and perhaps see a boost in revenues by doing so. The process of imparting knowledge allows you to hone into the nuances of subjects, and, as noted above, it is a chance to get your ideas vetted by other lawyers during Q & A.  Although there used to be some concern that you were “giving away” expertise by sharing it, right now every brief you are writing can be downloaded and used for source material.  There are no secrets.  There’s also the added benefit of getting your name out as an expert.

And Now, A Word from Our Sponsor

I did warn you that there would be a marketing element to this. If you don’t want it, stop now.

Still with me?  As I’ve mentioned here before, I’ve recently become affiliated with Strafford Publications, the leading provider of sophisticated CLE Webinars. My role there involves seeking and outlining content, and, locating speakers.  If you have something about which you’d like to learn, or like to speak, please let me know (e.lang@straffordpub.com).  I will also mention, in more than passing, that Strafford’s menu of content – live and archived – is excellent.  Having been working with Strafford for some months know, I am fully aware of how deeply topics and speakers are vetted before they are put out there for purchase.   Do check Strafford out at www.straffordpub.com.

Atlanta Condemns Virgin Bride; Court of Appeals Agrees

When you are writing about a condemnation case called Virginia Bryde vs. City of Atlanta, Georgia Court of Appeals No. A19A0600, May 8, 2019, the temptation to have some fun with the title of the post is just too great.  I gave in. (My apologies to Ms. Bryde, who apparently married into the last name, based on some references to her husband in the opinion.)

The case concerns challenging and appealing a condemnation, and contains what might be viewed as a harsh result.  Atlanta instituted condemnation proceedings which were served on March 27 but did not file the returns of service until April 5.  The Brydes answered on May 5, with a notice of appeal.  The answer would be timely if the April 5 date controlled, and untimely if the March 27 date controlled.  The trial court granted the City’s motion to dismiss the appeal as untimely, and this appeal followed.

At issue was the interaction of the Civil Practice Act and the statutory condemnation process.  OCGA § 9-11-4 (h) states “If the proof of service is not filed within five business days, the time for the party served to answer the process shall not begin to run until such proof of service is filed.”  OCGA § 32-3-14, regarding condemnation proceedings, contains no such requirement.

To reconcile these provisions, the Court of Appeals explained that “The provisions of the CPA apply to all special statutory proceedings except to the extent that there are specific practice and procedure rules in conflict and expressly prescribed by law.”  So framed, the issue was whether there was a conflict.  At this point you might be thinking, in the exact words of the opinion, that “Neither OCGA § 32-3-8 nor § 32-3-14 contain any express language regarding proof of, or return of, service.” From that you’d conclude that the CPA controls.  Except, not.  The court viewed the statutory language “not later than 30 days following the date of the service” as an absolute line, not subject to the proof of service provisions of the CPA.

But then there’s footnote two, which I will quote entirely:  “The Brydes were served with a citation which informed them of their right to file a notice of appeal if dissatisfied with the amount of compensation “not later than thirty (30) days following the date of service as provided for in OCGA §§ 32-3-8 through 32-3-20. . . .” However, the Brydes were also served with a traditional summons which provided that “[a]n answer to the complaint . . . served upon you” must be filed “within 30 days after service of this summons upon you . . . unless proof of service of this complaint is not filed within five (5) business days of such service. Then time to answer shall not commence until such proof of service has been filed.” We note the conflicting information provided to the Brydes, but no argument was made in this regard.” I don’t get it.   The Brydes acted timely by one measure, which happened to have been wrong.  Though I could disagree with the ruling, it is the law.  But the court had an out:  it could have rejected the Brydes CPA argument, but then, on the facts of this case only, say the Brydes were “saved” by the conflict in the summons.

I guess in one sense, we can say the bride is no longer a virgin.  (Again, sorry, but I had to.)

Two Important Georgia Criminal Law Decisions (I Think.)

I don’t practice in the criminal law area but two decisions came out of the Georgia Supreme Court that seem worth some attention.  The first is State v. Orr, Georgia Supreme Court, No. S18G0994 (May 6, 2019), which eliminates “judge made exclusionary rules” under the new(ish) Georgia Evidence Code.  The second is State v. Turnquest, Georgia Supreme Court, No. S19A0157, May 6, 2019, which holds that “neither the Georgia right against compelled self-incrimination, the Georgia right to due process, nor a Georgia statute prohibiting compelled self-incrimination requires law enforcement to provide similar warnings to persons arrested for DUI before asking them to submit to a breath test.”

Orr concerned “failure to come forward” argument, which was not permitted under a prior exclusionary rule. The trial court applied the rule; the Court of Appeals affirmed.  The Supreme Court granted certiorari and reversed. The court foreshadowed its ruling early on by stating “To understand where Mallory’s categorical exclusionary rule is headed – oblivion – it is important to understand where the rule came from.”  The rule was not constitutionally based; it was simply a creation of judicial policy arising out of Georgia’s old evidence code.  But “the new Evidence Code created a “new evidence world” in this State.”  The court explained that Chapter 4 of the evidence code declared “legislative policy decisions about the risks of prejudice associated with certain categories of evidence.”  Rule 403, the court explained, should govern the ”failure to come forward” issue on a case by case basis, with no bright line in place.  There’s a detailed discussion of factors to consider in such cases, which, if you practice criminal law, you should read.

Turnquest, obviously, is a DUI case. The facts were stipulated – Turnquest was read the statutory implied consent language, but not Miranda rights, before providing a breath test. The trial court excluded the test because under existing controlling authority, it appeared that a Miranda warning was required.  The court engaged in a detailed review of the history and development of self-incirmination protection in Georgia, reaching all the way back to English common law. From this review, the Court explained “In sum, there is no significant evidence from the common law as it was understood in 1776, Georgia law as of 1877, or the larger American legal context as of 1877 that the right to be free from compelled self-incrimination was understood to require suspects in custody to be warned of that right — or any other constitutional right — in order for their otherwise voluntary statements to be admissible.”  In terms of federal constitutional principles, the court made two points:  “Indeed, it is difficult to conceive how or why Georgians would delegate to the United States Supreme Court the authority to alter the meaning of the Georgia Constitution by unknown future federal decisions.”  Then,  “of course, there is no decision of the United States Supreme Court holding that the federal Due Process Clause (or any other federal constitutional provision) requires Miranda warnings to precede a request for a breath test.”  Finding that the otherwise controlling precedent was relied on unsound reasoning, the court ruled that the warnings were not required.

These cases are not in my area, but I am sure others will find them useful.

Intervention Motions: CivPro 101, With a 2019 Case Cite

O’Brien v. Builders Insurance, Georgia Court of Appeals No. A19A0686, May 3, 2019 is an otherwise unremarkable opinion that allows the practitioner some more recent caselaw in the otherwise undramatic world of motions to intervene under OCGA § 9-11-24.

O’Brien sued Duerk (and others) for damages from defective construction. Three years later, Builders – the defendant’s insurer – moved to intervene.  “After a hearing, the trial court, without explaining the basis for its ruling, summarily granted the motion and allowed Builders to intervene for the purposes of participating in discovery and proposing a special verdict form.”  The appeal followed the certificate for immediate review.

The Court of Appeals reversed, setting out principles of law from cases that were an average of 22 years old.  The court began by noting that strangers to lawsuits are not normally allowed to intervene, but there are exceptions.  But those exceptions do not come into play if the intervenor has another proper proceeding in which its rights could be protected. In this case, not only was the motion made three years into the pending proceeding, “Builders acknowledges that it could bring a declaratory judgment action to determine coverage after the underlying action is completed.”

Rulings on intervention motions, though, are subject to the abuse of discretion standard. But, because one of the things the movant needed to show – lack of another remedy – was absolutely not present, the court found that discretion was abused.

Again, not an exciting outcome, but, one to stick in the file for that day you need the case cites.