Opinion ID: 2455402
Heading Depth: 1
Heading Rank: 4

Heading: The Effect of Plaintiff's Counsel's Conduct

Text: I can understand concern about the finality of judgments if any judgment could be opened up without limit simply on a finding of mistake or inadvertence. Contrary to the suggestion in the concurrence, this record presents no such danger. Equity has an answer for this concern in the requirement that mistake, in order to justify equitable relief, must be mutual. The cases consistently hold that the mistake of one party is mutual if the opposing party knows of the mistake. Plaintiff's counsel's own testimony shows that he was perfectly well aware of what had happened when he received communications from defendant's counsel on March 23 and March 29, 1985. He knew that counsel was proceeding with the defense of the case, on the mistaken assumption that it was properly pending, and that the extension papers must not have reached him or the courthouse. He knew that if defense counsel were alerted, the default judgment would probably be set aside as of course. Vandergriff, supra . He also knew that if the situation remained the same until April 10 had passed, the default would be infinitely more difficult to set aside. Knowing these circumstances, he deliberately refrained from answering his mail, or even from acknowledging the communication. His conduct should shock all right-thinking lawyers. The Court should not hesitate to say that this kind of conduct is unacceptable in our profession. The processing of civil litigation requires that lawyers deal with each other in accordance with the highest standards of trust and candor. The two communications called for a response within a reasonable time, which in the setting of this case means without delay. Perhaps counsel did not have a duty to tell his opponent in so many words that he had taken a default, but at the very least he could dictate a letter saying, we have no record of your firm's involvement in the case. I accept the proposition that a lawyer has a duty to advance his client's interest by all honorable means, and would reject any suggestion that professional courtesy should prevail over the lawyer's duty to his client. I would like to be remembered as a lawyer who went all out for his clients. But I would stop short of taking advantage of a mistake known to me. Nor would I sanction a situation in which the Court permits other lawyers to get away with conduct which I consider the legal equivalent of fraud. See Columbian National Life Insurance Co. v. Black, 35 F.2d 571, 574 (10th Cir.1929). This Court, in the last analysis, sets the standards which Missouri lawyers must observe. It should not allow this plaintiff and his attorney to profit from deceptive conduct or deceptive silence. In one of the earliest treatises on legal ethics the late Judge George Sharswood, sometime Chief Justice of Pennsylvania, speaks as follows: Let [the reader] shun most carefully the reputation of a sharp practitioner. Let him be liberal to the slips and oversights of his opponent whenever he can do so, and in plain cases not shelter himself behind the instructions of his client. The client has no right to require him to be illiberaland he should throw up his brief sooner than do what revolts against his own sense of what is demanded by honor and propriety. Sharswood, An Essay on Professional Ethics, 73-74 (6th Ed.1930). We should require lawyers to comply with this standard, not only as a matter of professional courtesy, but as a positive rule of law. Here there was a duty to reply to the correspondence, and, since there was a critical limit, to make some sort of response within that time limit. Lying in wait until the response was stripped of its meaning should not be countenanced. But we do not have to argue on the basis of special rules for the legal profession. I do not really believe that plaintiff's counsel's conduct would be acceptable in the world of commerce. See Appendix. In similar situations the courts have recognized equitable remedies. In the traditional casebook exemplar, Columbian National Life Insurance Co. v. Black, supra, 35 F.2d 571 at 574, the court said: When [the insured] received the policy he either did or did not notice the error. If he did not notice it, the mistake was mutual. If he did notice it and said nothing, he was guilty of such inequitable conduct as to amount to fraud. Here too there is conduct which a court of equity should hold to be the legal equivalent of fraud. But we do not have to characterize the conduct as fraudulent. Equity also gives relief for mutual mistake, which includes the mistake of one party, known to the other. The Restatement (Second) of Judgments § 67 comment c states as follows: If the party obtaining the [default] judgment was on notice of facts indicating the neglect by the attorney or insurer, that is a factor weighing in favor of relief. Williston on Contracts, Vol. 12 at 382 (3d Ed. (Saeger) 1970), comments: Unilateral mistake, even apart from knowledge of the other party to the transaction of the mistake, has been held in some cases to justify relief; and it has been held with undeniable justice that mistake by one party and knowledge of the mistake by the other will justify relief as fully as mutual mistake. (Emphasis added). And Pomeroy's Equity Jurisdiction, supra, § 847, puts the issue in the following language: Whatever be the effect of a mistake pure and simple, there is no doubt that equitable relief, affirmative or defensive, will be granted when the ignorance or misapprehension of a party concerning the legal effect of a transaction in which he engages, or concerning his own legal rights which are to be affected, is induced, procured, aided, or accompanied by inequitable conduct of the other parties. It is not necessary that such inequitable conduct should be intentionally misleading, much less that it should be actual fraud; it is enough that the misconception of the law was the result of, or even aided or accompanied by, incorrect or misleading statement, or acts of the other party..... That these propositions are applicable in Missouri is clearly shown by the cases cited in Part 2 of this opinion. A negligent mistake will not bar equitable relief. [1] In 17 Couch, Insurance (2d Ed.1983) § 66:36, the author discusses the equitable remedy of reformation of insurance contracts, as follows: Where the mistake of one party is combined with the knowledge of the other party that the first party has made a mistake, there is generally sufficient ground for reformation even though the mistake that was made was merely unilateral. In sum, the effect is to hold that when the other party proceeds with the knowledge that the first party is laboring under a mistake, his conduct is inequitable and therefore warrants reformation.... Neither the principal opinion nor the concurring opinion shows why these authorities are not pertinent and controlling under the undisputed facts. The information that plaintiff's counsel's conduct is immaterial in an equitable action is not supported by any authority I can find. The principal opinion cites Barney v. Suggs, 688 S.W.2d 356 (Mo. banc 1985), for the proposition that an attorney has no obligation to advise the opposing party or his counsel that he has taken a default judgment. That case has absolutely no application to the present situation because there was no indication whatsoever that plaintiff's counsel knew that the defendant had retained counsel, or had any communication with or from counsel. It appears, rather, that the defendant himself misplaced the summons and the petition and failed to notify his insurance carrier. The case simply holds that no appeal could be taken from the default when no motion to vacate had been filed. [2] Totally inapplicable is Friedman v. The Caring Group, Inc., 750 S.W.2d 102 (Mo. App.1988). Friedman held nothing more than that the defaulting defendant was not entitled to having a default judgment set aside when he could not demonstrate a meritorious defense. Id. at 105. It is indeed strange that the principal opinion follows the court of appeals blindly in citing as authority a court of appeals decision which does not even analyze or discuss the issue of setting aside a default judgment based upon plaintiff's attorney's conduct. It is factitious to try to bolster case law in this manner. We must assume that the opinion discussed the matters the court considered controlling and precedentially significant. [3] The citation in the principal opinion, then, is spurious. It is interesting to consider what plaintiff's counsel would have done if defense counsel had called him on the telephone seeking to arrange a time for depositions. I hardly think that he could properly have agreed on a date, without advising counsel that he had taken a default. [4] This example differs only in degree and not in kind from the actual situation before us. It has been suggested, unfortunately, that plaintiff's counsel was justified in doing as he did because his client might have sued him for malpractice. [5] We should certainly take this occasion to say so all can hear that communications between opposing counsel are a part of the normal practice of law, essential in the orderly handling of litigation, and that a lawyer cannot subject himself to malpractice liability by acting honorably toward his forensic opponents. Judge Covington professes to be sympathetic, but foresees dire consequences both as to defaults and in other cases if the rules on setting aside judgments in equity are relaxed. Equity courts over the years have anticipated such problems, but have had no trouble in applying the concepts of mutual mistake and extrinsic fraud so as to do equity to all. See Sutter v. Easterly, 354 Mo. 282, 189 S.W.2d 284 (1945). The writer does not cite the precedents found to be so compelling, and I cannot find them. The conduct of plaintiff's counsel, at the very least, demonstrates a mutual mistake authorizing equitable relief.