Bressler attorneys Diana Manning, Benjamin DiLorenzo, and Ann Marie Effingham drafted an amicus brief on behalf of the New Jersey State Bar Association that was filed with the New Jersey Supreme Court in the matter of Meisels v. Fox Rothschild LLP, Docket No. 081534. The appeal concerns the duties of attorneys holding client funds, as well as, their responsibilities when disbursing funds at the direction of the client. To view the brief, please click here.

The underlying matter took place over eleven years ago when a nonparty company, Rightmatch, Ltd., a company in which plaintiff Moshe Meisels (“Plaintiff”) claimed an interest, wired $2.5 million in funds to Defendant Fox Rothschild’s trust account for its client, Eliyah Weinstein’s (“Weinstein”), use in a real estate transaction. Fox Rothschild subsequently disbursed the funds in accordance with the direction of its client, Weinstein.

Five years after the disbursement, Plaintiff sued Fox Rothschild alleging multiple claims, including conversion and breach of fiduciary duty for disbursing the funds at Weinstein’s direction, notwithstanding that the third party had never communicated with Fox Rothschild or made any claim to the funds. After the claims were dismissed by the trial court, the Appellate Division affirmed the lack of a fiduciary duty between the plaintiff and Fox Rothschild, but permitted the plaintiff to pursue a conversion claim against Fox Rothschild based on its distribution of the $2.5 million at Weinstein’s direction. The Petition for Certification followed. 

Before the New Jersey Supreme Court, the amicus brief argues that the Appellate Division’s decision creates an untenable conflict between RPC 1.2, which requires attorneys to honor client instructions, and a potential duty to unknown and undisclosed non-client third parties. The brief voices NJSBA’s concern that if the Appellate Division’s decision is affirmed, it would establish an impossible and illogical standard for lawyers holding client property, as they are ethically required to honor client instructions regarding the disbursement of funds to which no competing claim has been made. Likewise, NJSBA is also concerned with the recognition of a conversion cause of action against attorneys who disburse funds at a client’s direction. Because an attorney honoring a client instruction has not exhibited dominion and control over the funds, he or she should not be held liable for conversion based on the client’s instructions. The matter has not yet been scheduled for oral argument before the New Jersey Supreme Court.

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