In a dispute between two Virginia lawyers, a U.S. District Judge has rejected attorney Cynthia Smith’s claim that another attorney, Timothy Purnell, interfered with her contract with a client and caused her to suffer nearly $4 million in financial losses.
Smith had been representing a Northern Virginia family, the Wieses, in a dispute with their neighbors. Eventually, the Wieses became dissatisfied with her representation and hired Purnell in her place. Smith sought her full $30,000 fee from the Wieses but ended up settling the fee dispute with them for $5,000. She and the Wieses signed a settlement agreement in 2009 that provided for a full release of all claims. Two years later, Smith sued Purnell over his role in representing the Wiese family, alleging that Purnell tortiously interfered with her right to receive the full payment from the client. She said that Purnell at one point promised her that he would ensure that she would be “paid in full” by the Wieses and that he reneged on this promise. She also claimed that she signed the settlement agreement under duress in that her “decision to trust God” led to a series of financial losses.
U.S. District Judge James Cacheris, in a December 9, 2011, ruling, rejected all of Smith’s claims and dismissed the complaint. He turned down her motion for leave to amend her complaint, finding that any amendment would be futile because the facts before him did not state a cause of action. Judge Cacheris wrote that Smith’s claims were barred by the release language in the settlement agreement that she signed in 2009 with the Wieses. In his ruling, the judge pointed out that the agreement extinguishes all claims that Smith might have not only with the Wieses but also with their attorneys. Judge Cacheris ruled further that Smith’s financial distress at the time did not amount to legal “duress” that permitted her to avoid the provisions of the settlement agreement.
“There are no facts alleging that Defendant or the Wiese family exerted force, intimidation, or threats related to the offer to settle, and, in fact, there is evidence that they also offered to bring the dispute to mediation,” the judge wrote. “That Plaintiff informed Defendant of her difficult financial position does not convert the offers to mediate and settle into coercion.”
Judge Cacheris also ruled that even if it were not for the settlement agreement, Smith could have no claim against Purnell for interfering with her agreement with the Wieses. Purnell was their attorney and thus their agent, he pointed out – and Virginia law does not allow a claim for tortious interference by an agent with his principal’s contract, since for this purpose the agent and the principal are one and the same entity. One cannot tortiously interfere with one’s own contract. “Despite being an attorney, Plaintiff has remarkably missed the fact that the attorney-client relationship is one of agency,” the judge wrote.