Court Opinion

ID: 9551487
Source: CourtListenerOpinion
Date Created: 2023-08-07 18:54:21.848639+00
Date Added: 2024-06-11T15:24:00.501384
License: Public Domain

SUTIN, Judge (concurring in part and dissenting in part). On petition for rehearing, the former opinion is withdrawn and the following substituted therefor. (A) I dissent on affirmance of Judgment on Directed Verdict in favor of defendant Sue Bynum. (B) I specially concur in reversal of Judgment on Directed Verdict in favor of defendant Oliver Cohen. (C) I specially concur in affirmance of Judgment on Directed Verdict in favor of defendant Elizabeth J. Cohen. (A) Decision of trial court on defendant Sue Bynum was erroneous. The trial court denied plaintiffs’ motion for a directed verdict at the close of all the evidence, as follows: There has been a lot of evidence here as to whether there was or wasn’t a contract and those are questions of fact for the jury, and, of course, the motion for directed verdict against Mr. Cohen, that is also denied, that is a question of fact for the jury. [Emphasis added.] Defendant Oliver Cohen moved for a directed verdict on behalf of himself and Sue Bynum. He claimed that he had the right to move for a directed verdict for Sue Bynum because a judgment against her would be a judgment against Cohen. Defendant Sue Bynum did not have an attorney at trial. Prior thereto, the trial court permitted Cohen to assert her defenses. A motion by Oliver Cohen for a directed verdict on behalf of Sue Bynum is not the assertion of a defense. The motion did not present to the trial court the matter of a directed verdict. The trial judge granted Sue Bynum a directed verdict for the following reasons: (1) The Statute of Frauds bars this action, and (2) “[T]he plea of the plaintiff of partial performance is not available to the plaintiff in the suit for damages against Sue Bynum since the suit for specific performance has been dismissed. . . . ” Plaintiffs moved to amend their complaint so that it would show their reliance on the doctrine of equitable estoppel as against Sue Bynum, in light of the evidence that had been presented at trial. This was denied, because Sue Bynum was not present. Denial of plaintiffs’ motion to amend their complaint to conform to the evidence was an abuse of the trial judge’s discretion, contrary to the letter and spirit of Rule 15(b) of the Rules of Civil Procedure [§ 21-1-1(15) (b), N.M.S.A.1953 (Repl.Vol. 4)]. The judgment on Court Directed Verdict as to defendant Sue Bynum is erroneous and should be reversed. (B) Whether Cohen induced Sue Bynum to breach her agreement with her ex-husband in the context of an attorney-client relationship is an issue of fact for the jury. I concur with the holding as to Cohen in the majority opinion. However, I feel the majority has not sufficiently elucidated the nature of Cohen’s behavior, in light of the law on business transactions between attorney and client. We are here reviewing a directed verdict for defendant. This directed verdict “can be affirmed only if, viewing the evidence in the light most favorable to plaintiff, there remained no issue of fact for determination by the jury.” Cole v. Younger, 58 N.M. 211, 214, 269 P.2d 1096, 1098 (1954). (1) Coherís Relationship With Sue Bynum Defendant Sue Bynum received, as part of a 1968 divorce settlement, the equity in a house owned by her and plaintiff Harold Bynum during the marriage. The parties orally agreed in 1970 that the house would be sold by Sue to her former husband, Harold, in return for a portion of the purchase price in cash, a portion by payment of the balance due on an automobile, and a portion by forgiveness of monies due from Sue to Harold. The parties agreed to the sale on July 17, 1970. A memorandum agreement and a deed to the premises, from Sue to Harold and his new wife, Jane, were drawn up for presentation to their lawyers the next day, so that a formal document could be executed. On the morning of July 18, Sue went to Oliver Cohen’s office and engaged him as her lawyer. She sought his legal advice as to whether or not she should enter into this agreement with Harold. She asked Cohen about the legal effect of that agreement. Cohen denies that any attorney-client relationship existed. However, on motion for a directed verdict, we must search- for that evidence which supports the plaintiffs’ case. There is sufficient evidence of an attorney-client relationship which creates an issue of fact for the jury. For purposes of this opinion, the relationship did exist. Cohen then went with Sue to the house. They inspected it, and Cohen said: “Mrs. Bynum, I don’t believe you are getting enough money for this place. . . . I’ll tell you what I will do. I will give you a check for $500, then I will send you a check for $1,500, then a check for $4,000 on or before the 15th of September.” Sue accepted the offer. It was $500 more than Harold had offered her. While they were at the house, Harold drove up. He entered the house and Sue introduced Oliver Cohen, as her lawyer, to Harold. Harold inquired if Cohen was going to prepare the papers, and Cohen said: “I have bought the house.” A bitter discussion ensued. Harold told Cohen that he had already entered into an agreement to purchase the house, and he insisted that Sue proceed to complete the transaction and take a $1,500 check. Cohen said, “Well, I have already bought the house. If you want to give more than I am giving for it, you can buy it.” When Harold asked the amount Cohen was giving, Cohen refused to answer. That afternoon, Cohen prepared the purchase agreement and a deed from Sue to Oliver, both of which were executed by Sue. The agreement was performed and Cohen obtained title to the premises. One or two days later, Cohen demanded that Harold give him a warranty deed which Harold refused to do. “I didn’t know what him and Sue was trying to pull on me.” On October 14, 1970, Cohen deeded the property to a Mr. Harold Lukens, who gave Cohen a check for $1,500. On December 10, 1970, Lukens, by check, paid Sue Bynum $4,000. Subsequently, the property was deeded back to Cohen. (2) Cohen’s attorney-client relationship warrants an issue of fact on whether he inditced Sue Bymim to breach her contract with Harold Bynum. We should not have to say more than the trial court during an argument at trial in which he said to plaintiffs’ attorney: “Well, you have alleged that he [Cohen] induced Sue to breach the contract and you have evidence to that effect.” [Emphasis added.] The relationship between an attorney and client is one of the highest trust and confidence. “[T]he law requires that the acts and conduct of the attorney in transactions with his client be characterized by absolute fairness, good faith and honesty.” Van Orman v. Nelson, 78 N.M. 11, 22, 23, 427 P.2d 896, 907-908 (1967). He cannot purchase from his client unless he is able to show that he made a full communication to his client of all he knew that would be of advantage to the client regarding the negotiations. “With respect to transactions between an attorney and his client involving the acquisition of property from the client a heavy burden is imposed upon the attorney to establish the absolute fairness of the transactions.” Van Orman v. Nelson, supra, 78 N.M. at 17, 427 P.2d at 902. A review of the real estate contract between Cohen and Sue Bynum discloses no intention on Cohen’s part to refrain from inducing Sue Bynum not to perform her agreement with her husband, an agreement of which he had knowledge. Cohen sought the purchase of the property. He knew that he could not purchase it unless Sue breached her agreement with Harold. Did Cohen, without justification and privilege, induce Sue not to perform her agreement with her husband? No one, other than Sue and Cohen, can answer the question. A heavy burden is on the attorney to establish that the transaction was fair. Van Orman v. Nelson, supra. The confidential relationship between Sue and Cohen raises a presumption, under the circumstances of this case, that Cohen did induce Sue to breach her agreement with Harold. If Sue and Cohen testify that Cohen did not induce her to breach the agreement, the jury can believe or disbelieve them. The credibility of their testimony should be weighed by the jury. “An attorney’s dealings with his client [are] always subjected to the closest scrutiny of the courts, and justly so . .” In re Renehan, 19 N.M. 640, 666, 145 P. Ill, 120 (1914) (opinion on rehearing). If an attorney-client relationship existed, did Cohen induce Sue to breach her agreement with her husband? Did Cohen unlawfully violate a privileged relationship with his client? A jury should answer these questions. A confidential relationship should not permit an innocent third person to suffer because the conversations between Sue and Cohen were not recorded. This type of business transaction leads to criticism and difficulties.