Kus v. Irving

Brief Fact Summary.

Attorneys Dubicki (Defendant) and Camassar (Defendant) were partners with Irving (Defendant) in a limited liability partnership law firm, and argued that they were not liable to Kus (Plaintiff), a client of Irving (Defendant), for Irving’s (Defendant) misconduct since they had no personal knowledge of the dealings between Irving (Defendant) and Kus (Plaintiff), they had not benefitted from those dealings, and had not supervised or controlled Irving (Defendant).

Synopsis of Rule of Law.

Limited liability partners are not personally liable for misconduct by another partner if they have no personal knowledge of the misconduct, do not receive a benefit from the misconduct, and do not directly supervise or use control over the other partner.

Facts.

Kus (Plaintiff) brought suit against his attorney Irving (Defendant), who was a partner in a limited liability partnership law firm with Dubicki (Defendant) and Camassar (Defendant).  Kus (Plaintiff) claimed that Irving (Defendant) was guilty of various acts of misconduct, and Kus (Plaintiff) also named Dubicki (Defendant) and Camassar (Defendant) in the action.  Dubicki (Defendant) and Camassar (Defendant) moved for summary judgment, on the grounds that they had no personal knowledge of the dealings between Irving (Defendant) and Kus (Plaintiff), did not benefit from Irving’s (Defendant) misconduct, did not supervise or use control over Irving (Defendant), and were protected from liability by the state’s limited liability partnership statute, which stated that “a partner in a registered limited liability partnership is not liable directly or indirectly . . . for any debts, obligations and liabilities . . . chargeable to the partnership or another partner or partners . . . arising in the course of the partnership business while the partnership is a registered limited liability partnership†unless such liability is based on his own negligence, wrongful acts or misconduct, or that of any individual under his direct supervision and control.

Issue.

Are limited liability partners are not personally liable for misconduct by another partner if they have no personal knowledge of the misconduct, do not receive a benefit from the misconduct, and do not directly supervise or use control over the other partner?

Held.

(Hurley, J.)  No.  Limited liability partners are not personally liable for misconduct by another partner if they have no personal knowledge of the misconduct, do not receive a benefit from the misconduct, and do not directly supervise or use control over the other partner.  While Kus (Plaintiff) claimed that Dubicki (Defendant) and Camassar (Defendant) were guilty of negligence, wrongful acts and misconduct, she failed to provide evidence to support her claim.  And so, there is no issue of material fact in this regard.  Additionally, because Dubicki (Defendant) and Camassar (Defendant) received no benefit, had no direct supervision or control over Irving (Defendant) and had no knowledge of the misconduct before it occurred, they were protected from liability by the limited liability partnership statute.  Summary judgment is granted to Dubicki (Defendant) and Camassar (Defendant).

Discussion.

Many law firms use the limited liability partnership form of entity, which the American Bar Association Ethics Committee has ruled to be consistent with the Model Rules of Professional Conduct.