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Mazon v. Krafchick3/7/2005
Attorney Michael Mazon sued his co-counsel, Steven Krafchick, after they settled a malpractice claim brought against them by their mutual client. Krafchick had failed to serve the complaint on time. Mazon's primary claim was for $325,000, the contingent fee he expected to get had he and Krafchick successfully pursued their client's lawsuit. The trial court ruled that co-counsel could not sue one another for lost prospective fees. We agree and hold that it would create a conflict with an attorney's primary duty to his client to allow co-counsel to sue each other for lost or reduced prospective fees, regardless of the theory of recovery.
FACTS
On July 9, 1999, Tahar Layouni was electrocuted in a workplace accident and suffered from fibromyalgia and chronic pain as a result. Layouni hired Michael Mazon on a contingency fee basis to sue the parties responsible for the accident. With Layouni's consent, Mazon brought Steven Krafchick into the case as co-counsel because Krafchick specialized in fibromyalgia and chronic pain cases. In late July 2000, Mazon and Krafchick signed a joint venture agreement providing that they would split evenly all costs and any fee collected.
In January 2002, Mazon and Krafchick agreed that Mazon would draft the complaint and provide names and addresses for service of process, and Krafchick would file and serve the summons and complaint. Mazon completed his designated tasks, and Krafchick filed the summons and complaint on May 15, 2002, three days before the statute of limitations expired. Based on the filing date, the 90-day rule required that Krafchick serve the defendants before August 13, 2002. Krafchick directed his paralegal, Diana Rouser, to serve the complaint. He relied on Rouser's assertions that she completed service before the August 13th deadline. In fact, she did not do so, and the statute of limitations expired on Layouni's personal injury claim. In late September 2002, Krafchick told Mazon about his failure to timely serve the complaint and drafted a letter to Mazon confirming their previous agreement that made Krafchick responsible for filing and serving the complaint.
Layouni sued Krafchick and Mazon for professional negligence. On February 7, 2003, they settled for $1.3 million. Of this amount, Mazon paid $50,000 through his insurance carrier, and Krafchick paid the balance through his insurance carrier. Each paid his respective deductible. Mazon then filed a complaint in King County Superior Court against Krafchick claiming (1) breach of the joint venture agreement, (2) breach of fiduciary duties, (3) professional negligence, (4) gross negligence, and (5) indemnification. He sought recovery of the following damages: (1) $465.40 in expenses incurred to prosecute Layouni's case, (2) loss of the $325,000 fee he expected to earn, (3) his $2,500 insurance deductible payment, and (4) the settlement payment his insurance carrier made. Mazon and Krafchick filed cross-motions for summary judgment.
The trial court granted Krafchick's motion on the joint venture, fiduciary duty, professional negligence, and gross negligence claims. The court granted Mazon's motion on the indemnification claim and ordered Krafchick to pay Mazon $2,965 to cover his insurance deductible payment and costs advanced on the Layouni case. Both parties appeal.
DISCUSSION
We review summary judgments de novo, performing the same inquiry as the trial court. Summary judgment is proper only when there is no genuine issue about any material fact, and the moving party is entitled to a judgment as a matter of law. We consider all facts and reasonable inferences in the light most favorable to the nonmoving party. Quest
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