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Kilpatrick v. Wiley12/14/2001
here could be exceptions to this general rule, however, holding that an implied attorney-client relationship with the individual limited partners may arise under certain circumstances. Id. at 1200-01. Specifically, we concluded that such a situation may arise when the individual limited partners reasonably believe they are individually represented by the limited partnership's legal counsel. See id. at 1200. We went on to state that " hen . . . the individual interests of the limited partners are directly involved, . . . there may be sufficient grounds for implying the existence of an attorney-client relationship." Id. at 1201 (emphasis added). Under the circumstances of Margulies, we concluded that the three doctors' "impression and belief," id. at 1200, that they were individually represented by Jones, Waldo was reasonable in light of the fact that Jones, Waldo's representation of Diversified Energies directly benefitted the three doctors. See id. at 1200-01.
The trial court here found an implied attorney-client relationship based solely on its conclusion that Wiley Rein was "directly involved" with the interests of the individual limited partners of MWT, Ltd. However, the court did not then go on to conclude that the individual limited partners reasonably believed Wiley Rein represented their individual interests from May 1988 through December 1991. Indeed, in evaluating the existence of an express attorney-client relationship, the court indicated that it had reached the opposite conclusion. Specifically, the court rejected as " warranted" the plaintiffs' asserted belief that Wiley Rein continued to represent them after the departure of Barry Wood. In support of this conclusion, the court noted that Wood sent Joseph Lee several letters "indicating he had left Wiley Rein to join plaintiff David Lee at Jones, Waldo's Washington, D.C. law office, and taken plaintiff's files with him." We conclude the trial court's ruling misinterpreted Margulies.
Margulies did not, as the trial court interpreted it, create two separate tests to determine whether an implied attorney-client relationship exists. Under the trial court's reading of Margulies, an attorney-client relationship may exist where either the limited partners reasonably believe the limited partnership's counsel represents them individually, or where the limited partnership's legal counsel does work that directly involves the limited partners' interests. However, Margulies adopted only one test to determine whether an implied attorney-client relationship exists, i.e., whether the individual limited partners reasonably believed that the limited partnership's legal counsel represented their interests. In resolving this question, a court looks at the totality of the circumstances, see, e.g., Rhode Island Depositors Economic Protection Corp. v. Hayes, 64 F.3d 22, 24-26 (1st Cir. 1995), including whether the limited partnership's legal counsel was "directly involved" with the individual interests of the limited partners. Thus, direct involvement is not a separate test, but only one factor to consider in determining whether the specific circumstances of the case demonstrate the individual limited partners' belief concerning representation is reasonable.
B. Whether the Error was Harmful
Having concluded the trial court erred in its interpretation of Margulies, we now address whether that error requires reversal. Even if a trial court erroneously grants a motion for partial directed verdict, "we will not reverse a judgment merely because there may have been error; reversal occurs only if the error is such that there is a reasonable likelihood that, in its absence, there would have been a result more favorable to the compl
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