VSC: Contractual right to attorneys' fees applies to this breach of covenant of good faith and fair dealing

Harsch Properties, Inc. v. Nicholas 2007 VT 70 [Filed 27-Jul-2007] http://dol.state.vt.us/gopher_root3/supct/current/2005-494.op

Where exclusive listing agreement provided, "If the Broker is forced by collection or litigation effort to enforce the terms and conditions of this agreement, then the prevailing party will be entitled to reimbursement for all costs of collection, including attorney's fees," Broker was entitled to fees where Broker prevailed on claim that homeowners violated covenant of good faith and fair dealing by negotiating directly with prospective buyers; covenant of good faith and fair dealing was an implied term of the agreement, thus meeting the "terms and conditions" provision re: recovery of costs and attorneys' fees.

VSC: professional opinions are generally not actionable under Vt consumer fraud statute

The Vt. Supreme Ct recently ruled that opinions based on professional judgment are generally outside the scope of Vermont's consumer fraud law. Although the case involved a real estate appraisal, the Court based its ruling on a federal court decision involving a legal opinion.

The case was Webb v. Leclair 2007 VT 65 [Filed 12-Jul-2007]

¶ 1. [Plaintiff] appeals a summary judgment for [defendant] on her claims of negligent misrepresentation, fraud, consumer fraud, and negligence arising from defendant's appraisal of a home she purchased. The appraisal was done on behalf of plaintiff's mortgage lender. Plaintiff argues that the superior court erred ... in dismissing her consumer fraud count. We hold ... that plaintiff's consumer fraud claim is in fact an assertion of malpractice that is outside the scope of our consumer fraud law. We therefore affirm.

In so holding, the Court approved the federal court's ruling in Kessler v. Loftus, 994 F. Supp. 240 (D. Vt. 1997) that a legal opinion is generally not actionable under Vermont's consumer fraud law. Here is what the Vermont Supreme Court wrote:

¶ 23. We now expressly adopt the Kessler court's interpretation, based on Winton, that although certain representations may give rise to a malpractice claim, they are generally not actionable under the Consumer Fraud Act if they are the product of the defendant's "professional judgment based upon his legal knowledge and skill." Kessler, 994 F. Supp. at 243 (quotations and ellipses omitted). A plaintiff cannot simply recast a malpractice claim as a consumer fraud claim. Moreover, for purposes of this rule, we see no meaningful distinction between lawyers and other professionals hired to give a "specialized or expert interpretation" of a matter, as defendant was here. Winton, 147 Vt. at 240, 515 A.2d at 374.

VSC update re vicarious liability -- "aided by the agency relationship"

See Doe v. The Newbury Bible Church <http://dol.state.vt.us/gopher_root3/supct/current/2006-186.op> , 2007 VT 72 [Filed 20-Jul-2007]

¶ 1. SKOGLUND, J. In this federal diversity action, plaintiff John Doe seeks to hold the Newbury Bible Church vicariously liable for criminal and tortious conduct committed by its pastor. We have accepted the following certified question from the United States Court of Appeals for the Second Circuit pursuant to Vermont Rule of Appellate Procedure 14:

Under Vermont law, as expressed in Doe v. Forrest, 2004 VT 37, [176 Vt. 476,] 853 A.2d 48, is a church subject to vicarious liability for the tortious acts of its pastor under the Restatement (Second) of Agency § 219(2)(d) if the pastor was allegedly 'aided in accomplishing the tort by the existence of the agency relation' with the church?

We answer the certified question in the negative.

2nd Cir: personal jurisdiction; Zippo

a website's interactivity may be useful for analyzing personal jurisdiction under section 302(a)(1), but only insofar as it helps to decide whether the defendant "transacts any business" in New York--that is, whether the defendant, through the website, "purposefully avail[ed] himself of the privilege of conducting activities within New York, thus invoking the benefits and protections of its laws."

* * *

fn. 13 The spectrum [established by Zippo may also be helpful in analyzing whether jurisdiction is permissible under due process principles. We note that the court in Zippo and most, if not all, of the courts that subsequently adopted the Zippo sliding scale were evaluating whether jurisdiction in those cases comported with due process, under state long-arm statutes that recognized jurisdiction coterminous with the extent allowed by the federal Constitution. See, e.g., Young, 315 F.3d at 261. We make no comment at this point on the relevance of the Zippo sliding scale in New York in evaluating whether the exercise of jurisdiction would be consistent with due process.

Best Van Lines, Inc. v. Walker 2007 WL 1815511, *11 (2d Cir. 2007)

2nd Cir: Attempt to clarify calculation of attys' fees under fee shifting statutes

The meaning of the term "lodestar" has shifted over time, and its value as a metaphor has deteriorated to the point of unhelpfulness. This opinion abandons its use.FN4 We think the better course-and the one most consistent with attorney's fees jurisprudence-is for the district court, in exercising its considerable discretion, to bear in mind all of the case-specific variables that we and other courts have identified as relevant to the reasonableness of attorney's fees in setting a reasonable hourly rate. The reasonable hourly rate is the rate a paying client would be willing to pay. In determining what rate a paying client would be willing to pay, the district court should consider, among others, the Johnson factors; it should also bear in mind that a reasonable, paying client wishes to spend the minimum necessary to litigate the case effectively. The district court should also consider that such an individual might be able to negotiate with his or her attorneys, using their desire to obtain the reputational benefits that might accrue from being associated with the case. The district court should then use that reasonable hourly rate to calculate what can properly be termed the "presumptively reasonable fee."
FN4. While we do not purport to require future panels of this court to abandon the term-it is too well entrenched-this panel believes that it is a term whose time has come.
Arbor Hill Concerned Citizens Neighborhood Ass'n v. County of Albany, 2007 WL 2004106, *7 (2d Cir. 2007)

SCOTUS:Clarifies pleading standards; Will VT courts follow suit?

UPDATE (3/24/2008): See more recent post

Thursday, May 24, 2007
Is Twombly the Death-Knell for Notice Pleading?
Posted by Marty Lederman at 09:16 AM
In its decision Monday in the antirtust case of Bell Atlantic v. Twombly <http://supremecourtus.gov/opinions/06pdf/05-1126.pdf> , the Court expressly (and sua sponte) rejected the half-century-old nostrum from Conley v. Gibson that "a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Id., at 45-46. The complaint in Twombly alleged a Sherman Act conspiracy (that the petitioners "agreed not to compete with one another"), but did not specifically allege any facts that would establish such an agreement -- and the Court therefore held that the complaint should be dismissed for failure to state a claim. (See Mark Botti's helpful summary here <http://www.scotusblog.com/movabletype/archives/2007/05/commentary_mond.html> .)
The Twombly opinion not surprisingly has caused quite a stir in civil procedure circles. Does it signal the rejection of notice pleading and, if so, how can it be reconciled with the Court's decisions in Swierkiewicz (2002) and Leatherman (1993)? Can its holding somehow be limited to certain sorts of Sherman Act allegations, or does it have much broader implications for pleading practice?
It looks as though these questions will be hotly debated in the academy <http://lawprofessors.typepad.com/civpro/> and lower courts in the near future. Michael Dorf has a very helpful initial take <http://michaeldorf.org/2007/05/end-of-notice-pleading.html> on the alternative readings of Twombly that are already framing that debate. See also Scott Dodson's reading here <http://lawprofessors.typepad.com/civpro/2007/05/prof_scott_dods.html> . By contrast, Einer Elhauge <http://volokh.com/archives/archive_2007_05_20-2007_05_26.shtml> calls the case "quite insignificant," not to mention unhelpful for resolving longstadning questions with respect to antitrust complaints.
In general, keep your eyes on the Civil Procedure Prof Blog <http://lawprofessors.typepad.com/civpro/> , where the issue is sure to continue to receive a lot of attention..

Comments
Twombly does not turn away from notice pleading, as Footnote 10 makes clear. Rather, the Court held that an allegation of a conspiracy does not provide adequate notice to the defendants, in the absence of such details as the "specific time, place, or person involved in the alleged conspiracy." The Court contrasted Twombly's allegation to that set forth in model Form 9: the defendant struck the plaintiff with his car while the plaintiff was crossing a particular highway at a specified date and time. The latter allegation is sufficient under Rule 8, because (unlike the Twombly complaint) it provides sufficient notice of the alleged misconduct.
But even though it does not abandon notice pleading, Twombly is nonetheless an important decision. Particularly when the defendant is a corporation, tort complaints very often are fuzzy regarding who committed the allegedly act and when they did it. Twombly will, and should, cause complaints raising a variety of claims to be dismissed under Rule 12(b)(6). In the employment discrimination area, complaints in cases like Swierkiewicz are unassailable because they focus on a specific employment decision (e.g., a discharge decision) and thus provide the notice that a defendant needs to prepare a defense. But in cases raising more generalized discrimination claims (e.g., that the plaintiff was subject to a work environment that was racially harrassing in nature, or that the corporation maintained a company-wide personnel "policy" that tolerated sex discrimination in individual employment decisions), the complaint will need to recite specific facts supporting those claims in order to survive a motion to dismiss.
Many complaints filed under the Alien Tort Statute may also be ripe for 12(b)(6) dismissal. ATS plaintiffs often point to human rights abuses by a foreign government, and then allege that a corporation doing business in that foreign country aided and abetted the abuses -- based solely on factual allegations that the corporation provided various types of material and logistical support to the foreign government. Twombly suggests that those types of complaints should be dismissed (for reasons quite apart from the separate issue of whether aiding and abetting claims are actionable under the ATS), in the absence of an allegation of specific decisions to aid the human rights violations.
Posted by: Richard Samp <http://rsamp@wlf.org> <http://profile.typekey.com/Richard%20Samp> at May 24, 2007 11:31 AM

VT Wrongful Death Statute of Limitations

Under Vermont law, the personal representative of a decedent's estate must generally commence a wrongful death action "within two years from the discovery of the death of the person." 14 V.S.A. § 1492(a). But "[i]f the death of the decedent occurred under circumstances such that probable cause is found to charge a person with homicide, the action shall be commenced within seven years after the discovery of the death of the decedent or not more than two years after the judgment in that criminal action has become final, whichever occurs later." Id.

It appears that the legislature amended 14 V.S.A. § 1492(a) after the Leo-Coneys case, Leo v. Hillman 164 Vt. 94 (1995), to allow the estate to benefit from the State's development of a case against the alleged killer. Since "probable cause" approximates the preponderance of the evidence standard, the legislature may have assumed that if the State can ultimately make that showing, the estate can too and should be given the benefit of more time to do so (the State has no statute of limitations). Evidence about the killing may not be sufficient 2 years after the death to warrant a wrongful death action. Rather than requiring estates to file timely but possibly meritless wrongful death suits, the estate is allowed to piggyback the State's efforts, whether or not the State obtains a conviction (if probable cause is found, the amended Wrongful Death 2-year period runs from when the criminal judgment becomes final, regardless of the result).