114 Cal.App.3d 39, 57548, Weiner v. Mitchell, Silberberg & Knupp

Docket Nº:57548
Citation:114 Cal.App.3d 39, 170 Cal.Rptr. 533
Party Name:Weiner v. Mitchell, Silberberg & Knupp
Case Date:December 29, 1980
Court:California Court of Appeals

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114 Cal.App.3d 39

170 Cal.Rptr. 533

Julian WEINER, Plaintiff and Appellant,


MITCHELL, SILBERBERG & KNUPP, Edmund A. Hamburger, Arthur Groman, and Howard S. Smith, Defendants and Respondents.

Civ. 57548.

California Court of Appeal, Second District, Third Division

Dec. 29, 1980.

As Modified Jan. 20, 1981.

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[Copyrighted Material Omitted]

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R. Milton Smith, Beverly Hills, and Jerome A. Paver, Los Angeles, for plaintiff and appellant.

Haight, Dickson, Brown & Bonesteel, Roy G. Weatherup and Jerry M. Custis, Los Angeles, for defendants and respondents.

COBEY, Acting Presiding Justice.

Plaintiff, Julian Weiner, appeals from a judgment (Code Civ.Proc., § 581d) dismissing, pursuant to Code of Civil Procedure section 581, sub-division (3), this action following his noticed failure to amend further his second amended complaint as expressly authorized by the trial court in its minute order sustaining the various demurrers (both general and special) of defendants thereto. 1

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Plaintiff in his second amended complaint attempted to state causes of action for malpractice, conspiracy, fraud and deceit, breach of fiduciary duty and interference with prospective advantage against the various defendants. He alleged in this pleading the following in his malpractice count. Mitchell, Silberberg & Knupp was a law firm which inferentially included, among others, the three individually named defendants. Plaintiff was a duly licensed certified public accountant of substantial experience and a senior partner in a large accounting firm which had grossed in the fiscal year ending September 1971 a total of $1,750,000.00, of which plaintiff's personal share was $160,000.00. On or about February 1, 1972, plaintiff apparently merged his accounting firm into the accounting firm of Seidman & Seidman in which he became a partner. At that time he recommended to his clients that they become clients of the Seidman firm, which they did.

Between March 30 and July 12, 1973, each of the defendants agreed orally and in writing to represent plaintiff competently and faithfully as his personal counsel without conflict of interest and with full disclosure of all material facts to him in an investigation then being conducted by the Securities Exchange Commission (SEC) and other public agencies relating to Equity Funding Corporation and its subsidiaries. Nevertheless defendant, Arthur Groman, and certain fictitious defendants attended certain meetings of the Seidman firm in early 1973, at which they agreed that the firm should terminate plaintiff but retain his former clients. Each of the defendants knowingly and willfully failed to disclose these meetings and this agreement to plaintiff or that the defendant law firm had already agreed to represent primarily the Seidman firm in the aforementioned investigation. Thereafter defendants knowingly and willfully failed to advise plaintiff to retain his own counsel in the investigation and failed to keep confidential any and all attorneys' work products and documents that plaintiff had turned over to them in the belief that they were acting exclusively as his personal counsel. Defendants then aided and abetted the Seidman firm in secreting audit workpapers relating to Equity Funding and the results of such audit while pretending to prepare plaintiff for his prospective testimony before the SEC and other agencies on behalf of the Seidman firm and as a partner therein. This led to plaintiff being wholly unprepared for and deprived of indispensable records in his testimony before the SEC with the result that he was thereafter criminally indicted for acts committed by others connected with the Seidman firm. Defendants explored

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with the SEC and the other agencies involved whether they would condone the Seidman firm's conduct in consideration of its collaboration in obtaining plaintiff's indictment by surrendering to the investigating agencies confidential workpapers, etc. of plaintiff which he had entrusted to defendants in professional confidence. As a result of this duplicitous conduct on the part of defendants and their representation of these conflicting interests of the Seidman firm and plaintiff, plaintiff suffered...

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