Thursday, February 21, 2013

Sletteland v. Roberts case brief

Sletteland v. Roberts case brief summary
16 P.3d 1062

SYNOPSIS: Plaintiff appealed, and defendants cross-appealed, First Judicial District Court, Lewis and Clark County (Montana), judgment for plaintiff on his complaint that defendant fellow close corporation shareholders charged excessive legal fees and for defendants on their counterclaim that plaintiff brought the suit in bad faith, damaging the corporation.

-Plaintiff and defendants were shareholders and directors of an energy production close corporation involved in a limited partnership with a larger company.
-The partnership agreement gave the limited partner, the other company, approval power over legal work performed by defendants for the partnership.
-When plaintiff fell out with the others, he sued, challenging fees charged by defendants as excessive. -The suit derailed the partnership's financing plans, and defendants counterclaimed for breach of fiduciary duty.

-The court found an abuse of discretion in the trial court's reduction of defendants' legal fees, because the contract gave the limited partner responsibility for this determination and the amounts were reasonable given defendants' expertise.
-It affirmed the award of damages to defendants on their counterclaim, however, because substantial evidence in the record indicated that the lawsuit was either deliberately or negligently timed to damage the financing efforts.
-The court stated that the P was negligent and breached his fiduciary duty to BCI and his fellow shareholders by the timing of his filing of the lawsuit.

HOLDING:: The court reversed judgment that defendants overcharged, because contract with third party gave it power to approve fees to defendants and evidence in the record supported their reasonableness. It affirmed judgment for defendants on their counterclaim, because substantial evidence supported finding, as well as damages determination. 

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