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Frasier2/15/2005
Mandate Issued: 06/03/2005
This is an appeal by a former law firm partner, from judgment entered on jury verdict in favor of the plaintiff law firm in its action for breach of contract, deceit and fraud. Based on our review of the record on appeal and applicable law, we affirm.
FACTS AND PROCEDURAL HISTORY
Attorney Robert Flynn (Flynn) joined the law firm of Frasier, Frasier & Hickman, L.L.P. (Frasier), as an associate attorney in 1991. He subsequently was admitted to "Class B" partnership. As a "Class B" partner, Flynn became entitled to receive a designated interest in the profits of the partnership. However, he obtained neither equity nor interest in the assets of the partnership, nor did he have the right to participate in the management decisions of the partnership. The "Class B Partnership Agreement," which Flynn executed on January 1, 1995, contained this provision:
If the undersigned Class B Partner leaves the Partnership, any fees generated by any cases then being handled for any client of the Partnership who chooses to take his case with the departing Class B Partner shall be divided between the Partnership and the departing Class B Partner according to the respective amount of work performed for the client on the case before the client left the Partnership versus the amount of work performed thereafter; provided that, in no case shall the Partnership's portion of the fee be less than one half (1/2) of the total fee in a contingent fee case. In any case handled in whole or in part by the undersigned Class B Partner, same will agree to protect any referral fee to any non-Frasier & Frasier attorney. This paragraph shall not limit Partnership's damages in case of a breach of this Agreement.
The partnership agreement also contained a non-solicitation provision, whereby Flynn agreed that he would not solicit business from Frasier's active clients for a period of two years following his departure from the law firm.
In August 2000, Flynn informed Frasier of his intention to leave the law firm. Flynn's departure was not immediate - the parties reached an agreement whereby Flynn continued working for the firm as a contract laborer, paid on a per diem basis. By subsequent written agreement, Flynn formally withdrew from the partnership on October 11, 2000. The parties terminated the working relationship on November 6, 2000, and Flynn subsequently opened his own law practice.
Following his separation from the firm, Flynn continued to handle many of the pending contingency fee cases that had originated with Frasier. These were primarily workers' compensation cases, for which Flynn collected fees when he successfully concluded the cases by settlement or trial. There were some active cases, for which Frasier had advanced substantially all of the litigation expenses, which Flynn resolved just over one month after his departure from the firm.
When paying workers' compensation awards, insurers often issued checks made payable to the client, and to Flynn and Frasier. Flynn requested that Frasier endorse these checks, which it did. Frasier later claimed it did so with the understanding that, after distributing the funds due to the client, Flynn would retain the attorney fees and costs in a trust account, and the monies would remain there until the parties determined how to divide them. However, Flynn used the monies to operate his practice, and later denied telling Frasier that the monies would be placed in a separate trust account.
The parties could not agree on how to divide the generated fees. According to Flynn, as the attorney who "closed the file" he was entitled to one half of
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