[co-author: Julia Ruch]
A Massachusetts Superior Court judge recently granted a defense motion for judgment on the pleadings in Orbian v. Burns & Levinson. The decision reminds us of the importance of lawyers understanding and adhering to the scope of their retainer agreements.
The case involved a lawyer who was engaged by Orbian to review an executive agreement between Orbian and its general counsel. Orbian requested that the lawyer only review Schedule 1 of the contract “to determine that there [would] be no untoward, inequitable consequences to either party.” Schedule 1 entitled the general counsel to receive money upon either his retirement or other certain events, such as the sale of the company. Orbian expressed that it did not anticipate “too many ‘comments’ or suggestions” on the agreement and the lawyer determined that “nothing seemed amiss.” The lawyer billed the client for his time, and Orbian thanked him for his work.
Years later, following a series of whistleblower complaints regarding his workplace behavior, Orbian terminated the general counsel and was required to make a payout pursuant to Schedule 1. Orbian then sued the lawyer, alleging if the lawyer had “flagged the absence of a morality clause in his review,” litigation could have been avoided.
The Massachusetts Superior Court disagreed. The judge found that the lawyer’s duty to Orbian was limited to the scope of the engagement letter, i.e., the review of Schedule 1, and did not extend to the entire agreement. The judge explained that although Orbian may wish “in hindsight… that a morality clause had been included does not mean that [the lawyer’s] performance was deficient or caused Orbian harm.”
Attorneys should always be mindful of the scope of their engagement agreements. Orbian v. Burns & Levinson serves as a success story of a lawyer who did not exceed the scope of his representation, despite post hoc attempts at expansion by their client.
A motion for reconsideration is currently pending.
[View source.]
