Question for Nosborne48

Discussion in 'Off-Topic Discussions' started by little fauss, Mar 9, 2006.

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  1. little fauss

    little fauss New Member

    I have a legal question for you.

    Let me give you a bit of setup. Follow me closely, it gets a bit complex:

    I have a client, I'll call him "Lenny" (not his real name), who is dealing with a potential lawsuit threatened by a person I'll call "George" (again, not the real name).

    George employed both my client, Lenny, and another individual, who I'll call "Squiggy", to do some work on a business venture for him.

    Lenny, my client, was recommended to George by Squiggy. You see, Squiggy had previously done some business with my client Lenny, it was natural to recommend him.

    The business deal went bad, George decided to go after Squiggy, both civilly and criminally. About that time, Squiggy got in deep trouble, and went to prison on another, unrelated matter (but the matter involved essentially the same conduct that George alleges Squiggy did to him in the deal that involved my client Lenny, and I'm sure that George's testimony against Squiggy helped put him away), had heavy fines levied against him, and became essentially judgment proof.

    George was frustrated, there was no way of getting his money lost in the deal. He then devised a plan: get at Lenny, he has money, he was involved in the deal, he was even recommended to George by that scoundrel Squiggy. George managed--somehow--to gain the trust of Squiggy, who's still stuck in jail. George interviewed Squiggy, then decided to threaten civil litigation against Lenny. George alleges that Lenny breached this, that and the other fiduciary duty to warn about Squiggy's shady past (which Lenny swears to me he knew nothing about), George alleges Lenny was fully in cahoots with Squiggy to defraud him (which Lenny swears to me he didn't do).

    OK, there's the setup to the present threatened litigation. Not that any of that is particularly relevant to the question I'm about to ask, but at least it gives you some context.

    George has been firing off a number of letters at me, the threats get greater with each letter. George recently sent me this, which is a verbatum excerpt from his most recent demand letter:

    Both [Lenny] and [Squiggy] will be named as defendants...[Squiggy] has agreed to cooperate in return for our agreement not to execute on any judgment obtained against him.

    Now my question is this: is it ethical to do such a thing?

    I know ethics rules vary by jurisdiction (and I don't want to reveal the jurisdiction here), but the thing seems to stink to me. It would seem that George just wants to name Squiggy as a defendant so that he will be there to testify against Lenny and implicate him. In other words, Squiggy is a sham defendant. I suppose George thinks that having one defendant turn against another in a litigation is a more stunning turnabout and more convincing to a jury that just having Squiggy called as a witness, I can only speculate as to George's motivation. But what bothers me about this is that Squiggy has nothing to lose here, judgment will not be executed against him per his agreement with George. Their "agreement" is likely a contract that's against public policy and would be invalid in my opinion, but it's none the less something that is being used to leverage my client Lenny, and back him into a corner where he'll be willing to negotiate a settlement favorable to George.

    I understand that all sorts of deals are made in a criminal context to elicit testimony of co-defendants, but this is always done above board, through the plea bargaining process--isn't it? I don't get the impression that George has any intention of going before the judge and revealing his side deal with Squiggy. In fact, I'm flummoxed that George would even reveal this stuff to me, though from what I know of him, he's a very agressive individual and might think he can bluff me and Lenny into a good hefty out-of-court settlement by showing us how impossible Lenny's plight will be in court.

    Or perhaps this is a perfectly commonplace tactic with which a small town hack like me isn't familiar. If it is, let me know. I've run this by another lawyer friend who told me he thought the thing was an outrage and an overreach by George, but he too is a small-timer like me.

    What do you think?
     
    Last edited by a moderator: Mar 9, 2006
  2. nosborne48

    nosborne48 Well-Known Member

    FWIW department

    Whats really happening here, I think, are two things:

    1) George is purchasing Squiggy's testimony which is usually illegal unless Squiigy is an expert witness, which I somehow doubt;

    2) The suit being in tort, it looks to me like George is releasing Squiggy. At common law, the release of a co tort feasor has the effect of releasing ALL co tort feasors.

    This is no longer the rule in New Mexico, BTW, but we are a pure comparative negligence state.

    Hope this helps! (Or is it a Bar exam question you are vetting?)
     
  3. little fauss

    little fauss New Member

    Nah, not a bar exam q, actually this is the real thing!

    I don't remember the thing about the release of one j/t operating to release all; that would be sweet. I'll have to take a look at the case law in the jurisdiction of which I speak to see if there's anything there.

    No, Squiggy is not an expert w, he's just a guy who got himself in a lot of trouble that fortunately my client was not swept up in (at least on crim side). He's the type of guy who I've told my client to turn and run from if he ever encounters such as him again, no matter how much pie he promises in his sky.

    Now George also claimed that he's not buying Squiggy's testimony, because he says any promises he makes not to execute judgment against him are "illusory" because Squig's judgment proof. I say nonsense, if there's an agreement at all that's ipso facto evidence of a perceived benefit to Squiggy. At the very least Squig thinks he's getting a benefit from the agreement, and certainly George is getting the testimony he wants.

    For accuracy's sake, here is George's explanation, verbatim:

    From our standpoint, this promise is illusory at best, given that [Squiggy] has no assets and a large judgment against him already, so we would have no way to collect. Thus, he really is not obtaining anything of value in return for his testimony.

    For my money, the only standpoint that matters is Squiggy's. If he perceives that he's getting a benefit, then I'd suppose George is buying testimony. And for that matter, of course George percevies a benefit to his firm. If not, why else did he do it?

    Thanks, Nosborne. I think I'm going to wait and see if this guy actually follows up with his threats to sue. If I see Squig listed on the complaint, I'm gonna let the guns (what guns I have) blaze.

    Sound like a plan? You're the crim expert, what would you do?
     
  4. nosborne48

    nosborne48 Well-Known Member

    If the release doctrine still applies, it's a good one.

    Also, of course, I know of no duty on Lenny's part toward George so you might file a 12(b)(6).
     
  5. nosborne48

    nosborne48 Well-Known Member

    Oh, and by the way

    Agreeing not to execute on a Judgment can never be an "illusory" payment.

    Judgments last a LONG time, longer, usually, than any statute of limitation for an underlying claim.

    George is saying, in effect, "Squiggy has no assets AND NEVER WILL have assets." That's speculation writ large.

    George doesn't know what he's talking about.
     
  6. little fauss

    little fauss New Member

    George doesn't know what he's talking about.

    You know something, this is what I've been thinking all along.
    You see, George is a licensed attorney, but he doesn't practice on a day-to-day basis, so far as I know. His firm's area of expertise is in a field only peripherally-related to the standard practice of law. While he's an international expert in that field and has published extensively, it's been dawning on me that he's really unfamiliar with the basics of law (at least less than me--I think!).

    But I just needed a little reassurance that I wasn't missing something and that he doesn't know something I don't. You know I practice part time and practice in a bit of a vacuum. There are not many members of the fraternity around this small town that I feel comfortable approaching with a casual question, and certainly not many who can relate to being licensed in another state and handling matters for a couple clients there only (it's kind of an unusual situation--but not unique, law via distance is becoming more common as well as educ via dl, there's even another lawyer in this little town who's Cal Bar licensed and does exactly the same thing I do).

    Anyway, I just needed a little primer from one who I know for sure knows what they're doing. And you fall into that category. Not meaning to sound like a little sycophant, but I know my limitations.

    Thanks greatly!
     
    Last edited by a moderator: Mar 10, 2006

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