Featured Chrome Extensions:

Casey IRACs are produced by an AI that analyzes the opinion’s content to construct its analysis. While we strive for accuracy, the output may not be flawless. For a complete and precise understanding, please refer to the linked opinions above.

Keywords

settlementplaintiffattorneyappealtrialobjectionappellant
settlementplaintiffdefendantattorneytrialappellantappellee

Related Cases

Prakashpalan v. Engstrom, Lipscomb & Lack, 223 Cal.App.4th 1105, 167 Cal.Rptr.3d 832, 14 Cal. Daily Op. Serv. 1459, 2014 Daily Journal D.A.R. 1672
View Case »
Hopson v. Mayor and City Council of Baltimore, 232 F.R.D. 228, 97 Fair Empl.Prac.Cas. (BNA) 617, 63 Fed.R.Serv.3d 582
View Case »
Williams v. Missouri, 451 U.S. 990, 101 S.Ct. 2328 (Mem), 68 L.Ed.2d 849
View Case »
Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 127 S.Ct. 2499, 168 L.Ed.2d 179, 75 USLW 4462, Fed. Sec. L. Rep. P 94,335, 07 Cal. Daily Op. Serv. 7139, 2007 Daily Journal D.A.R. 9258, 20 Fla. L. Weekly Fed. S 374
View Case »
Williams-Yulee v. Florida Bar, 575 U.S. 433, 135 S.Ct. 1656, 191 L.Ed.2d 570, 83 USLW 4269, 15 Cal. Daily Op. Serv. 4085, 2015 Daily Journal D.A.R. 4721, 25 Fla. L. Weekly Fed. S 213
View Case »
Justia Law Link
LexisNexis Link
Westlaw Link
CourtListener Link
Oyez Link

Hayes v. Eagle-Picher Industries, Inc., 513 F.2d 892

Facts

The plaintiffs, represented by an attorney who also represented 16 others, entered into a prior agreement that majority rule would govern settlement acceptance. On the eve of trial, a settlement offer of $155,000 was made, which resulted in a vote where 13 accepted and 5 opposed. The trial judge announced the majority's agreement in open court, but the opposing plaintiffs protested immediately after learning of the settlement. The trial court initially set aside the judgment but later reinstated it, prompting the appeal.

The attorney represented not only the appellants but also was the attorney for 16 others.

Issue

Whether the plaintiffs'-appellants' repudiation of a settlement agreement entered into by their attorney was justified.

Whether the plaintiffs'-appellants' repudiation of a settlement agreement entered into by their attorney on the eve of trial was justified.

Rule

An attorney does not have the authority to compromise a client's cause of action without express consent, and any agreement allowing a majority to govern the rights of the minority is contrary to the attorney-client relationship.

It is fundamental that an attorney does not by reason of his employment have authority to compromise his client's cause of action absent an emergency requiring prompt action.

Analysis

The court found that the arrangement allowing the attorney to settle the case over the express objection of the clients was contrary to the fundamental duties owed by an attorney to a client. The court emphasized that the approval of the client is essential for a binding settlement, and since the appellants had communicated their opposition to the settlement, the attorney's actions were unauthorized.

In our view, however, this arrangement is contrary to the plain duties owed by an attorney to a client.

Conclusion

The court reversed the trial court's decision to reinstate the judgment, holding that the arrangement allowing the majority to govern the rights of the minority was violative of the attorney-client relationship.

In sum, then, we conclude that the trial court erred in reinstating its judgment.

Who won?

The plaintiffs prevailed because the court recognized that the attorney acted without proper authority, and the settlement was not binding without the clients' consent.

The court as well as defendant-appellee was fully aware that some of the plaintiffs had not consented to the terms of the settlement.

You must be