• June 5, 2012

Triple Silver Disaster, Andy Warhol (1963)

Andy Warhol’s spooky image of capital punishment is excessive to describe the consequences of a recent unpublished Minnesota Court of Appeals decision against a small Eagan, Minnesota law firm, but still some will wonder how the firm decided the risk/benefit calculus favored this public relations gambit in bringing suit against its former clients for a 40% share of a settlement rather than a 33% share.

Nwaneri & Associates, PLLC was the third law firm to take the case of Olubunmi Oturu, et al., and got the case after “Firm #2” had brought the lawsuit, conducted some discovery, and “initiated settlement discussions.”

The Nwaneri firm had an engagement letter that provided that it would be entitled to one third of any recovery except:

If at any stage of the matter, LITIGATION becomes necessary, [CLIENTS] agree to pay [LAW FIRM] 40% of any amount of money recovered.

Here is the triple layer public relations disaster:

(1) Bringing a lawsuit against one’s clients for an additional 7% of their recovery does not tend to encourage “repeat customers;”

(2)  The law firm lost against its former clients at both the trial court and on appeal,  and the former clients were “pro se” (that is, not represented by lawyers); and

(3) The law firm lost its appeal because its agreement was held (correctly) to be ambiguously (that is to say, “badly”) written.

One of the unfortunate aspects about a litigation practice is that the skill-set for contract drafting does not play to many trial lawyers’ strengths.  Drafting contracts well requires pain-staking attention to detail, both careful word-by-word attention (as well as a full appreciation of the contract as a whole and the contexts where it will realistically apply in the future).

To make matters worse, law schools always teach “contract law” (i.e., contract principles) but they do not teach “contract drafting.”  Maybe this is thought to be too difficult to teach or, paradoxically, maybe legal academics look down on it as analogous to manual labor, which is beneath them.

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