Lawyer gets booted from estate gig, sues co-counsel
Okay boys, let’s play nice.
You, Stanley Schnapp, go back to minding the estate of dearly departed Isi Fischzang.
And you, Robert Steinberg, let go of those ill feelings you have for Stanley after it was decided that the estate would no longer require your services.
The upshot of this New York probate melodrama is that you can’t hold a colleague liable when the client decides to fire you.
Here’s the scoop.
Leon Borstein is the executor of the Estate of Fischzang.
In 2007, he retained Schnapp and Steinberg – both New York lawyers – “as my attorneys with respect to all legal proceedings and asset administration concerning the wills, assets and estate of the late Isi Fischzang.”
The September 2007 contract of employment for the attorneys provided that Steinberg would serve as “trial counsel for all litigation issues,” while Schnapp was designated as “the general counsel for the fiduciary and estate, with respect to all litigation proceedings concerning the wills, assets and estate of the late Isi Fischzang.”
What promised to be a lucrative engagement for all involved quickly turned sour.
Steinberg found himself on the outside looking in when a few months later Borstein decided to let him go, allegedly because of the quality of Steinberg’s work.
Steinberg couldn’t sue Borstein because the executor had the power to terminate the lawyer for any reason.
Besides, Steinberg saw Schnapp as the true villain in the whole affair.
According to Steinberg, Schnapp was the one who really fired him, apparently in some murky exercise of his authority as general counsel for the estate.
And Schnapp had done him in not because Steinberg was doing a bad job, but because Steinberg wanted to shift the blame from himself for certain delays in the probate of the estate.
At least that’s what Steinberg alleged when he sued Schnapp in March 2008, asserting claims of tortious interference and quantum meruit.
In the quantum meruit claim, Steinberg asserted that he had not been paid for work he performed for the estate at the behest of Schnapp.
On Tuesday, the New York Appellate Division decided that Steinberg lawsuit had no chance of success and affirmed its dismissal by a lower state court.
Of course, the big problem for Steinberg on his quantum meruit claim, and the one that had the court absolutely baffled, was why estate executor Borstein was not named as a defendant.
The court observed that “Steinberg’s quantum meruit claim against Schnapp is particularly perplexing, since the record not only contains the various documents prepared by Borstein memorializing his retention of Steinberg as ‘trial counsel for all litigation issues,’ but Steinberg’s own admission that he had been retained by the estate. Further, there is nothing in the record to support even an intimation that an attorney-client relationship existed between himself and Schnapp.”
The court also had a big problem with Steinberg’s claim that Schnapp had tortiously interfered with his contract with the estate.
Because the economic relationship at issue was one between attorney and client, Borstein had the right to terminate that relationship at any time with or without cause.
Steinberg was thus in the nearly untenable position of trying to obtain damages for the destruction of a non-binding relationship.
The court observed that Steinberg’s only hope in that context was to prove that Schnapp’s conduct constituted a crime or an independent tort.
This Steinberg could not do, the court said, noting that it would not suffice to merely show that Schnapps’ alleged bad-mouthing was the result of “self-interest or economic motivations.”
The court concluded that, “[a]t best, Steinberg is suggesting that Schnapp made an inaccurate statement about the quality of Steinberg’s work, which statement led Borstein to terminate the attorney relationship, a relationship that is terminable at will, in any event. Such statements would be neither tortious nor criminal.” (Steinberg v. Schnapp)
- Pat Murphy
