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Attorneys – Tort/Negligence – Unfair Trade Practices – Learned Profession Exemption – Civil Conspiracy

Teresa Bruno, Opinions Editor//September 13, 2017

Attorneys – Tort/Negligence – Unfair Trade Practices – Learned Profession Exemption – Civil Conspiracy

Teresa Bruno, Opinions Editor//September 13, 2017

Khashman v. Khashman (Lawyers Weekly No. 012-142-17, 20 pp.) (Lucy Inman, J.) Appealed from Mecklenburg County Superior Court (Hugh Lewis, J.) N.C. App. Unpub.

Holding: Plaintiffs’ allegations in support of their unfair trade practices and civil conspiracy claims against the defendant-lawyer are based on actions the lawyer undertook in his representation of his defendant-client. Consequently, the learned profession exemption in G.S. § 75-1.1(b) bars this claim, and the conspiracy claim also fails.

We affirm summary judgment for the defendant-lawyer.

Litigation between ex-spouses expanded to involve the plaintiff-husband’s plaintiff-business, and the defendant-wife hired the defendant-lawyer and the defendant-private investigator. Plaintiffs allege that the lawyer engaged in unfair trade practices and a civil conspiracy, based on allegations that the private investigator made defamatory statements about the husband as part of a plan among the defendants.

Summary Judgment

Ordinarily, it is error for a court to hear and rule on a motion for summary judgment when discovery procedures, which might lead to evidence relevant to the motion, are still pending and the party seeking discovery has not been dilatory.

However, in this case, the trial court had ordered the lawyer to appear and testify by deposition before he was even named as a defendant. Notwithstanding this May 2015 order, plaintiffs did not attempt to depose the lawyer until December 2015, after he had moved for summary judgment.

The trial court’s summary judgment order acknowledges that discovery was not complete, but the court had before it hundreds of pages of documents as well as the arguments of counsel. We agree with the trial court that it had before it ample evidence from which to decide a motion for summary judgment.

Furthermore, allowing plaintiffs to pursue discovery against the lawyer as a party rather than pursuant to a subpoena would undermine the learned profession exemption to unfair trade practices liability.

Unfair Trade Practices

G.S. § 75-1.1(b) exempts from liability claims arising from “professional services rendered by a member of a learned profession.” An attorney’s conduct in the usual representation of his client falls within this exemption.

Plaintiffs allege the defendant-lawyer engaged in unfair or deceptive trade practices when he directed a private investigator retained by his client to interview third parties. Plaintiffs also argue on appeal that the lawyer’s act of conveying a settlement offer from his client to plaintiffs’ counsel was an extortionate unfair or deceptive trade practice because it constituted a sizeable increase over an earlier settlement offer.

Assuming arguendo that the lawyer had directed the private investigator to interview third parties, because the lawyer presented unrebutted evidence that he hoped the investigator’s interviews would yield facts and evidence helpful in separate legal matters in which the lawyer represented the defendant-wife, such conduct would undoubtedly be an act within the scope of the traditional attorney-client role. The same is true of the lawyer’s settlement communications.

Public policy has always required that attorneys represent their clients zealously, and the learned profession exemption furthers this public policy by shielding attorneys from liability for representing their clients in the adversarial process of litigation. Because this exemption bars the unfair trade practices claims against the lawyer, the claim for civil conspiracy must also fail.

Even if the exemption did not apply, plaintiffs have failed to present even a scintilla of evidence to support their claims against the defendant-lawyer. While plaintiffs have presented specific evidence of meetings among defendants, a list of plaintiffs’ business associates provided to the private investigator by the defendant-wife, and the lawyer’s knowledge that the investigator was contacting names on that list, the evidence does not create a genuine issue of disputed fact that the lawyer was part of an agreement to defame the plaintiff-husband or to interfere with his business in an effort to extort money from plaintiffs.


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