Pro se appeal from a judgment of the United States District Court for the Southern District of New York, Leisure, J., denying appellant's motions to amend legal malpractice complaint and to compel further discovery and granting appellee's motion for summary judgment dismissing appellant's complaint. Affirmed in part, reversed in part and remanded for further proceedings.
Before: MANSFIELD, TIMBERS and MESKILL, Circuit Judges.
Hermine Hanlin, pro se, appeals from a judgment of the United States Court for the Southern District of New York, Leisure, J., denying Hanlin's motions to amend her legal malpractice complaint and to compel further discovery and granting appellee Marvin Mitchelson's motion for summary judgment dismissing Hanlin's complaint.
We affirm in part, reverse in part and remand for further proceedings.
In December 1976, Hermine Hanlin entered into a written partnership agreement with the four members of a singing group called "The Manhattans." The agreement provided not only that she would be an equal business partner with the four group members, but also that she would serve as the group's manager. Thus, in addition to receiving a share in the partnership's profits, Hanlin was also to receive a commission on the group's personal appearances and a percentage of the proceeds from its music publishing activities.
In 1981, shortly after the Manhattans received a Grammy award, there was a falling out between Hanlin and the group. Pursuant to a clause in the partnership agreement, the dispute went to arbitration in accordance with the arbitration laws of the State of New York. Hanlin retained California attorney Marvin Mitchelson to represent her in the arbitration proceedings. According to Hanlin, she entered into a verbal agreement with Mitchelson which required her to pay a flat fee of $25,000 in advance, plus expenses, and obligated him to handle the case "as far as it has to go." App. of Appellee at 5. She paid him the $25,000 fee.
During hearing before a three member panel of the American Arbitration Association, the Manhattans' attorney questioned Hanlin about her withdrawal of $26,700 from a joint account she shared with Manhattans group member Kenneth Kelley. Hanlin had not previously informed Mitchelson of this withdrawal; he first learned of it during the arbitration hearings. In a subsequent affidavit, Mitchelson stated that he initially decided to "'steer away' from the shoals of this potentially devastating testimony" for fear that the withdrawal would be considered a breach of Hanlin's fiduciary duty to the Manhattans and would harm her case against them. App. of Appellee at 305. When Kelley asserted a formal counterclaim for the $26,700, however, Mitchelson urged the arbitrators to treat the counterclaim as beyond the proper scope of the arbitration.
The arbitral award, issued on December 23, 1982, directed the Manhattans to pay Hanlin $20,620 and directed Hanlin to pay Kelley $26,750. The award also declared that Hanlin had percentage interests in certain Manhattans contracts and directed the parties to execute assignments in connection with those interests. According to Hanlin, these assignments were never executed and the award to her was never confirmed.
Hanlin was unhappy with the arbitral award and urged Mitchelson to apply it and to persuade the arbitral panel to correct alleged errors. Mitchelson did obtain a "Clarification of Award," issued by the panel on February 18, 1983, which explained an apparent discrepancy between the award and one of the assignments.
Hanlin, still dissatisfied, continued to urge Mitchelson by telephone, mail and telegraph to appeal. Not satisfied with his response, she wrote to him on March 28, 1983, asking that he return the $25,000 fee she had paid. A lawyer in Mitchelson's Los Angeles office responded by letter on March 30, 1983, refusing to make any refund, stating that the arbitration award was "final and . . . not appealable," and offering "to assist any counsel you may choose with a legal case history or any other service which I can reasonably provide" if Hanlin wished to sue any of the individual defendants in New York. App. of Appellee at 29. Hanlin responded by letter on April 6, 1983, asking for further advice about obtaining performance of the arbitral award without mentioning her earlier request for a refund.
Mitchelson himself wrote to Hanlin on April 21, 1983, saying that he had been unable to answer her letters because he had been involved in an automobile accident and had just been released from the hospital. Mitchelson reiterated that the arbitration was "binding" and explained why the award to Kelley might have been within the scope of the arbitration. Id. at 32-33. He then offered to seek to reopen the arbitration, but added "I cannot act for you if you are going to be hostile and keep asking me to return fees to you." Mitchelson stated that Hanlin was not entitled to a fee refund, noting also that Hanlin owed his office $6,500 in "costs" for the arbitration. Id.
On May 24, 1983, New York attorney Neal Rosenberg wrote to Mitchelson stating that he had "been retained by Ms. Hanlin in reference to the enclosed correspondence." Id. at 34. The "correspondence" was apparently the series of letters described above in which Hanlin had urged an appeal and Mitchelson had declined to pursue one. Rosenberg disagreed with Mitchelson's assessment that the arbitral award could not have been appealed. He stated, however, that the deadline had passed for seeking an order to vacate or modify the award and asked Mitchelson to "advise us as to how you intend to resolve this matter." Id. at 34-36. On June 21, 1983, an attorney in Mitchelson's "good faith opinion" that no appeal to the arbitral panel had been warranted and asserting that "any other relief," presumably including an appeal to a court, was beyond the scope of Mitchelson's representation of Hanlin. Id. at 37-40.
On April 6, 1984, Hanlin filed the instant diversity action against Mitchelson in the district court seeking compensatory and punitive damages for "intimidation," negligence, defamation and malpractice. Mitchelson counterclaimed for the $6,500 in costs and expenses allegedly owed to him by Hanlin. He then filed a single motion seeking either dismissal of the complaint under Fed. R. Civ. P. 12(b)(6) or summary judgment under Fed. R. Civ. P. 56.
In a memo endorsement issued August 23, 1984, Judge Edelstein, to whom the case was originally assigned, dismissed Hanlin's claims for intimidation and defamation, apparently pursuant to Rule 12(b)(6). Then, treating the negligence and malpractice claims together, he granted partial summary judgment to Mitchelson, preserving only Hanlin's claim that Mitchelson had improperly failed to object to the arbitral panel's consideration of the $26,700 Kelley counterclaim.
Subsequent to this ruling, Hanlin obtained some discovery. When Hanlin's deposition of Mitchelson was aborted by Mitchelson's attorney, Hanlin moved the district court for an order compelling a continuation of the deposition. Mitchelson cross-moved for summary judgment on the remainder of Hanlin's complaint. Hanlin then moved for leave to amend her complaint to add claims under contract and negligence theories based on Mitchelson's alleged failure to confirm the arbitral award within the one year limitations period.
In an opinion by Judge Leisure, to whom the case had been reassigned, the court denied Hanlin's motion to compel discovery, denied leave to amend and granted summary judgment to Mitchelson, dismissing Hanlin's complaint. ...