I had no authority to do that

by Walter Olson on May 3, 2012

A California attorney reached a $350,000 settlement just before a jury returned with its verdict on his client’s suit. Turned out the jury had been prepared to award $9 million. The plaintiffs attorney, C. Michael Alder, who is president of the Consumer Attorneys of Los Angeles, then told a judge that his developmentally disabled and brain-damaged client (who had been severely injured after jumping out of an ambulance) had not properly authorized him to settle the case. Los Angeles County Superior Court Judge Michael Johnson granted a new trial. [The Recorder, ABA Journal, Judicial Hellholes and followup]

{ 14 comments }

1 L. C. Burgundy 05.03.12 at 9:00 am

Well, I’m sure Mr. Alder would have been as honest if the jury verdict had been for $0.

2 E-Bell 05.03.12 at 9:08 am

That’s crazy. I’d be plenty ticked off if I were on the defense, but then I guess he should have had it in writing or on the record like California law apparently requires.

3 William Nuesslein 05.03.12 at 9:32 am

The defense attorney proved that the American jury in the subject case was incompetent. A $9 million settlement was completely irrational even for a lawyer.

4 roy in nipomo 05.03.12 at 10:40 am

Since Mr Alder acknowledged he misbehaved by improperly accepting the settlement, will he willingly forgo any recompense on the case and not be involved in the retrial?

5 Ron Miller 05.03.12 at 11:11 am

A settlement is a settlement. I think this is the wrong call.

But I don’t understand why someone would call the verdict in this case irrational. We have zero evidence. My guess is the guy had millions of dollars in past and future medical expenses and other economic damages.

6 Ed 05.03.12 at 11:53 am

If the lawyer agreed to a settlement without his client’s approval then he should be disbarred for legal malpractice and held liable for the $8,650,000 that he cost his client. As several of the links state: allowing a second trial sets a bad precedent. It also unfairly punishes the defendants who acted in good faith to settle for the negligence of this guy.

7 doug 05.03.12 at 1:48 pm

i find it hard to believe that he did not have settlement authority.

8 wfjag 05.03.12 at 4:18 pm

Mader v United States is much worse:

Mader v. United States, 2008 WL 5111047 (D. Neb. Dec. 2, 2008), rev’d., 619 F.3d 996 (8th Cir. Aug 31, 2010) (split panel), reh. and reh., en banc, den. (Nov. 12, 2010), reh., en banc, granted, opin. vac., (Dec. 14, 2010), new opinion, 654 F.3d 794 (Sept. 7, 2011) (en banc).

In Mader, decedent died on August 3, 2004. On August 3, 2006, the two-year anniversary of Mr. Mader’s death, the widow (Mrs. Mader)’s attorney signed and mailed a Standard Form 95, claims form, to the Veterans Administration, asserting a claim on behalf of the Estate under the Federal Tort Claims Act. No proof of Mrs. Mader’s authority as the Estate’s personal representative was submitted. On August 21, 2006 the VA’s Claims Counsel, sent Mrs. Mader’s lawyer a letter which, inter alia, requested evidence of Mrs. Mader’s status as personal representative. Neither Mrs. Mader nor her attorney responded. The VA’s Claims Counsel later telephoned Mrs. Mader’s counsel at least four times asking for the information, but, neither Mrs. Mader nor her lawyer replied. On September 19, 2007, the VA denied the claim in writing. In March 2008, Mrs. Mader, again claiming to be the Estate’s personal representative and purportedly acting on behalf of statutory beneficiaries, filed a wrongful death action against the United States under the FTCA. Id., 654 F.3d at 798 – 99. The court, sitting en banc, aptly summarized the effects of this course of conduct:

“Thus, after five years of consideration at the administrative, trial and appellate court levels, it has only recently become clear that Ms. Mader lacked the requisite authority to file a claim with the VA or to file a wrongful death action against the United States in federal district court. This critical fact was concealed due to Ms. Mader’s repeated refusal to disclose evidence of her status as personal representative to the VA.”

(ftn. omitted). Id., 654 F.3d at 802.

[As far as I am aware, neither the plaintiff nor the attorney were sanctioned.]

9 David Schwartz 05.03.12 at 7:48 pm

If the lawyer had the authority to agree to the settlement, it should be binding. If the lawyer had no authority to accept the settlement, then the settlement wasn’t accepted and the jury’s verdict should be accepted.

Was the jury dismissed prior to the settlement being entered into the record? I’m trying to understand the timeline from the linked articles, but it doesn’t make sense.

10 Ron Miller 05.03.12 at 9:49 pm

I’m not sure the jury gave its verdict, David, based on my my quick read. I thought it was a “juror said, oh, yeah, we were going to give you $9 million” type thing.

I don’t think the defendant should ever have to take the $9 million verdict, anyway. They were told they had a settlement. It is not the defendant’s job to find out if the lawyer has authority because it is presumed.

It sounds like the guy is a great lawyer. He could have made a mistake in the heat of battle. Jury is coming back; he has to make a call in real time under a lot of pressure. I wouldn’t hang him for it (although, either way, he is facing a pretty slam dunk legal malpractice case if he does not pop the new trial). But I think a settlement should be a settlement.

What the defendant should do if they really wanted to get revenge is settled the case for the $1.2 they wanted and leave the guy on the hook for the malpractice case for the rest. But, again, there really is no evidence here that this guy did anything other than make a mistake under pressure. That is malpractice but no crime against the people.

11 William Nuesslein 05.04.12 at 6:52 am

Ron Miller’s first comment makes the common and obnoxious mistake of conflating evidence of need with evidence of guilt.

The settlement has to hold, otherwise lesson one in torts class would be to accept a settlement just before a jury verdict without permission from your client and void the settlement if the jury verdict is better.

If the client was brain damaged could he give informed consent to anything at all?

12 Ron Miller 05.04.12 at 8:52 am

Mr. Nuesslein, that is simply not how it works and that was not the issue in this case. The lawyer always has a client that he is going to report to who controls the affairs of the person who not able to make these decisions for themselves. The lawyer is not saying, “Gee, my client did not consent because he is not capable of consenting.”

13 E-Bell 05.04.12 at 12:53 pm

If the client was brain damaged could he give informed consent to anything at all?

I had this question, too. The article doesn’t really spell it out, but the client appears to have his mother and another person overseeing the settlement, as he names them as people who could accept the settlement for him. Not sure what California law calls for in a case like this – I’m sure some states might require court approval of a settlement where one party is not mentally competent, the appointment of a guardian ad litem, etc.

14 Max Kennerly 05.12.12 at 8:38 am

In many states, there would have been a settlement, but not California. California requires settlements be in writing or on the record, which this was not. Once the settlement was reached, everyone — plaintiff’s lawyer, defense lawyer, and the court — should have asked it be put on the record before the jury was dismissed. They all dropped the ball.

Who should suffer the consequences when everybody drops the ball? I submit that the only solution is a “do-over,” i.e. doing the trial again. There’s no reason to punish the plaintiff more than the defendant for a settlement they both failed to memorialize before dismissing their jury.

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