Meehan v. Shaughnessy - Lecture notes 9 PDF

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Case Brief and Notes for Business Organizations I...

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MEEHAN v. SHAUGHNESSY 404 Mass. 419, 535 N.E.2d 1255 (1989) FACTS: Parties: Appellant: Shaughnessy (Δ) Appellee: Meehan (Π) Procedural History: 

Π filed suit in trial court and Δ counter claimed

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Trial court found in favor of Π

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Δ appealed

Relevant Facts: 

Π were partners in Δ law firm

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Π left firm and commenced action to recover amounts owed and obtain declaration as to the amount they owed Δ for work done that they removed to their new firm

ISSUE: 

Whether Π breached a fiduciary duty to Δ

PARTIES’ ARGUMENTS: Plaintiff:  Defendant:  DISPOSITION OF THE COURT: 

Reversed

RULE OF LAW: 

As a fiduciary, a partner must consider his or her partners’ welfare, and refrain from acting for purely private gain

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A partner has an obligation to render on demand true and full information of all things affecting the partnership to any partner

HOLDING: 

By remaining secret about the clients they were taking and the substance and method of communications with the clients Π breached a fiduciary duty to Δ

COURT’S REASONING:       

Π affirmatively denied to partners that he had any plans of leaving Π secretly made preparations for obtaining removal authorizations of clients Π were ready to move when they told the partners Π used their positions of trust to the disadvantage of Δ because of the secrecy of their leaving Π did not provide a list of clients they intended on taking until mid December at which point they had obtained authorization for most to transfer The notice to the clients did not clearly present a choice to the client Δ was prevented from presenting their services as an alternative to Π...