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Attorney-Client Relations

Myers v. Deets (Ind. Ct. App. May 29, 2012)

This case involves a suit by a client against an attorney and the attorney’s partner (“Edward”), firm, and insurance company after the attorney allegedly and improperly failed to refund part of a retainer.

The Court of Appeals first overruled the trial court’s grant of judgment on the pleadings to the attorney’s insurer, finding the complaint was sufficient to state a request for a declaratory judgment that the insurance company’s policy provided coverage. The court acknowledged that the direct action rule typically bars claims against a third-party’s insurance company, but concluded the Plaintiff’s complaint could be construed to request declaratory relief. Judge Riley dissented, disagreeing with the majority’s interpretation of the Plaintiff’s complaint. Judge Riley believed the complaint did not seek declaratory relief and was, instead, an attempt to bring an improper direct action. This aspect of the Court of Appeals’ holding illustrates the type of disagreement that can arise in a notice pleading regime.

The Court of Appeals then held summary judgment for Edward and the law firm was proper on the grounds that the undisputed admissible evidence showed that the attorney and Edward were not partners at the time the Plaintiff paid the retainer. At the trial court level, the Plaintiff submitted an affidavit stating that his attorney said he and a man named “Ed” were having a dispute over partnership matters and referred to this man as his partner. The Court of Appeals concluded this evidence was inadmissible hearsay under Evidence Rule 801(c) and would not consider it on summary judgment. An interesting question is whether the statements were, in fact, hearsay. Evidence Rule 801(d) excludes statements by party-opponents from the definition of “hearsay.” If the attorney were a member of the law firm, his statement would not be hearsay. If the Plaintiff, who was pro se, raised this argument, the Court of Appeals did not address it.

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