M.J. DiCorpo, Inc. v. Sweeney, 93-186
Citation | 69 Ohio St.3d 497,634 N.E.2d 203 |
Decision Date | 29 June 1994 |
Docket Number | No. 93-186,93-186 |
Court | United States State Supreme Court of Ohio |
Parties | M.J. DiCORPO, INC., d.b.a. Gupta, DiCorpo & Dykman, et al., Appellees and Cross-Appellants, v. SWEENEY et al., Appellants and Cross-Appellees. |
SYLLABUS BY THE COURT
An affidavit, statement or other information provided to a prosecuting attorney, reporting the actual or possible commission of a crime, is part of a judicial proceeding. The informant is entitled to an absolute privilege against civil liability for statements made which bear some reasonable relation to the activity reported.
Attorney Robert E. Sweeney, appellant and cross-appellee, is the sole shareholder of appellant and cross-appellee Robert E. Sweeney & Associates Co., L.P.A. ("RESCO"), an Ohio legal professional association. Michael J. DiCorpo, appellee and cross-appellant, is the sole owner of appellee and cross-appellant M.J. DiCorpo, Inc., d.b.a. Gupta, DiCorpo & Dykman ("Gupta-DiCorpo"), a professional consulting firm. In January 1988, RESCO hired Gupta-DiCorpo to serve as consultant to the law firm. From January 1988 to November 1989, Gupta-DiCorpo and Michael J. DiCorpo performed services for RESCO at agreed-upon hourly rates. Gupta-DiCorpo submitted monthly invoices to RESCO for the services performed by the consulting firm. All services were billed at the applicable hourly rate. It appears RESCO paid the monthly billing invoices through September 1989.
During the summer of 1989, RESCO and another Cleveland-area law firm, Climaco, Climaco, Seminatore, Lefkowitz & Garofoli Co., L.P.A. ("CCSL & G"), jointly retained Gupta-DiCorpo to negotiate and arrange a merger of RESCO and CCSL & G. In October 1989, Michael J. DiCorpo, acting on behalf of Gupta-DiCorpo, prepared a one and one-half page "letter of intent" (and, later, a one page addendum) setting forth some of the basic terms and conditions of the proposed merger. On or before November 1, 1989, the letter of intent and addendum thereto (with a few minor modifications) were signed and approved by Robert E. Sweeney and Michael L. Climaco on behalf of RESCO and CCSL & G, respectively. The letter of intent was dated November 1, 1989, and read, in part:
Beneath the signatures in the letter of intent is a paragraph that reads: "The consulting firm of Gupta, Dicorpo [sic DiCorpo] & Dykman will receive a fee of 2% upon completion of this deal, one-half payable by each firm." (Emphasis added.)
Apparently, within fifteen days of the signing of the letter of intent, a "definitive agreement" to combine the law practices was submitted by CCSL & G to Robert E. Sweeney for his approval and acceptance. However, the proposed definitive agreement differed dramatically from the letter of intent. The definitive agreement exceeded forty pages in length, addressed numerous matters not contemplated in the letter of intent, sought to impose significant burdens and obligations upon Robert E. Sweeney, and sought to limit Sweeney's power and control in the proposed combined law practice. The definitive agreement, like the letter of intent, contemplated a five-year employment contract for Robert E. Sweeney at $250,000 per year, and contained an eight-year schedule of "target net fee amounts" to be used in determining the compensation (if any) Sweeney was to be paid in connection with the merger. Sweeney refused to sign the definitive agreement and, consequently, RESCO and CCSL & G never merged.
In December 1989, Gupta-DiCorpo and Michael J. DiCorpo (collectively "appellees") filed a complaint in the Court of Common Pleas of Cuyahoga County against RESCO and Robert E. Sweeney (collectively "appellants"), RESCO's business manager and three members of the RESCO law firm. In the complaint, appellees alleged that on August 23, 1989, Gupta-DiCorpo entered into an oral "Compensation Agreement" with RESCO and CCSL & G. Specifically, appellees alleged that RESCO, CCSL & G and Gupta-DiCorpo had verbally agreed that compensation for Gupta-DiCorpo's services in connection with the proposed merger would amount to two percent of the "agreed upon merger price," with each firm (RESCO and CCSL & G) obligated to pay one-half of the commission. Appellees further alleged that the November 1, 1989 letter of intent "confirmed, documented, and set forth the Compensation Agreement" between Gupta-DiCorpo, RESCO and CCSL & G. Appellees claimed that the letter of intent constituted a binding and enforceable "[C]ontract of Merger," that Sweeney had reneged on the merger, and that, therefore, appellants were obligated to pay appellees two percent of the amount Sweeney would have been entitled to receive had the merger occurred.
In the complaint, appellees sought recovery against appellants in the amount of $285,000 for breach of the alleged oral "Compensation Agreement"-- i.e., two percent of the proposed $14.25 million Sweeney was to receive for the merger under items 2 and 3 of the letter of intent. Appellees also sought recovery against appellants in the amount of $285,000 for unjust enrichment. All remaining claims in the complaint were directed against other named defendants and are not at issue in this appeal.
Michael J. DiCorpo was deposed on July 24, 1990. In his deposition, DiCorpo testified concerning the terms of the oral "Compensation Agreement":
DiCorpo testified further that he had billed RESCO and CCSL & G at his customary hourly rate for all services performed in connection with the proposed merger to secure payment for his services in the event that negotiations between RESCO and CCSL & G did not result in a merger.
During the pendency of the case, the trial court granted a motion by appellees for permission to file a supplemental complaint against appellants. The events which gave rise to the filing of the supplemental complaint concerned an affidavit that was sent by Robert E. Sweeney to the Cuyahoga County Prosecutor in February 1990. In the affidavit, Sweeney accused Michael V. Kelley, a former associate of RESCO, of embezzling funds from a joint account maintained by RESCO and CCSL & G (the "Climaco-Sweeney Trust Account"). Sweeney averred that between January 1, 1989 and November 15, 1989, Kelley, "abetted and aided by one Michael DiCorpo," had "carried on a very close and vigorous effort" to persuade Sweeney to merge RESCO with CCSL & G, "as it was obvious to Mr. Kelley that the only way he [Kelley] could fold in the taking of the money from the Climaco-Sweeney Trust Account was to accomplish a merger between the respective...
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