IN THE

Supreme Court of Virginia AT RICHMOND

RECORD NO. 790635

JOSEPH S. GOODSTEIN AND SHELDON RUBEN, Individually and d/b/a

G. & R. Associates,

..... Appellants v.

EVERETT G. ALLEN, JR., and CO-PARTNERS, et al., d/b/a Hirschler, Fleischer, Weinberg, Cox & Allen,

APPENDIX

JOHN C, LOWE LOWE AND GORDON 409 Park Street Charlottesville, Virginia 22901 (.804) 296-8188

Counsel for Appellants

..... Appellees

APPELLATE PRINTING SE'RVICES, INC., HERITAGE BLDG, RICHMOND, VA. (804) 643·7789

. TABLE Qf ·coNTENTS

1. MOT~ON FOR JUDGMENT FILED AUGUST 8, 1977

APPENDIX PAGES

1

2. PROOF OF SERVICE FILED AUGUST 9, 1979 .............. 11

3~ ORDER TO FILE PLEADINGS··~···· ................... ,. 12

4~ GROUNDS OF DEFENSE FILED SEPTEMBER 12, 1977 ........ 13

5. PLEA OF STATUTES OF LIMITATIONS FILED OCTOBER 3, 1977 23

6~ SPECIAL PLEA IN BAR TO COUNTERCLAIM FILED OCTOBER 4, 1977 ····················~······················· 24

7. MEMOR.ANDUl-t IN SUPPORT OF PLAINTIFF~ S PLEA IN BAR TO DEFENDANT' S COUNTERCLAIM FILED OCTOBER 4, 19 7 7 . . 26

8. DEFENDANT~S MEMORAl~DUM FILED NOVEMBER 30, 1978 ..... 31

9. PLAINTIFF'S REPLY MEMORANDUM....................... 39

10. ORDER SUSTAINING PLAINTIFF'S PLEA OF STATUTE OF LI.MITATIONS AND DISMISSION COUNTERCLAIM FILED JANUARY 23, 1979 ......... _.......................... 42

11. NOTICE OF APPEAL FILED FEBRUARY 16, 1979 ........... 43

MOTION FOR JUDGMENT

Comes now,· Everette G. Allen, Jr. , hereinaf;er referred to

as "Allen", ·and co-partner~, the lawfirm hereinafter referred to

as "H & F", and for this Motion for Judgment against Sheldon

Ruben and Joseph S. Goodstein, individually and trading as

G & R Associates, hereinafter referred to as "G & R", states as

follows: .. \ ~ ~ 1. H & F is a partnership which is duly admitted to and

~ ~· engages in the practice of law in the Commonwealth of Virginia

~~ ~ and has been so engaged at all times mentioned herein. !21 . "i ~

., «N= ~i 2. J~seph S. Goodstein and Sheldon· Ruben are residents ~ ~! ~~ ~ ~: # ·of the City of Richmond, State·of Virginia, and hold certain

~ i ' It, ·I J111 1 1 d i h c f H" i Vi . i . .... ,~1 rea estate ocate n t e ounty o enr co, rg1n a, as

!ca! . ' .· 1

' l11 ~ partners in a general partnership known as G & R Associates.

~. li 1 ~ \I !\ 3. On June 17, 1974, G & R met with Allen to discuss

~ l-- 'i H & F undertaking the representation of G & R in the prosecution

jl II of the claim against Froehling & Robertson. After an initial

!~ conversation between the parties, G & R did employ H & F as II r il its attorney for the purpose of investigating and prosecuting t. :I jj a claim on its behalf against Freehling & Robertson.

tl 4. The fee arrangement agreed to by the parties was

II G & R would pay H & F for its services based upon the normal

li hourly rate of those lawyers working on the Froehling &

r Robertson claim. fi ii II !I H t: ij

I

5. From June 17, 1974 through and including March 18,

1975, H & F investigated and prosecuted G & R's claim against

Froehling & Robertson.

6. On or about February 17, 1975, H & F advised G & R 1

I I ) t

t~t it could not continue representing G & R due to the fact ·

an attorney with H & F would be required to testify in the

suit brought on behalf of G & R against Freehling & Robertson.

Attached hereto marked H & F's Exhibit "1" is a copy of Allen's

I letter toG & R dated February 17, 1977.

7. On March 18, 1977, H & F provided G &.R with its

statement for services rendered through February, 1975 in the

sum of $3,670.55 •. Attached hereto marked H & F's Exhibit 11 211

is the March 18, 1975 statement for $3,670.55.

8. H & F's statement for services rendered to G & R

dated March 18, 1975 in the sum of $3,670.55 was based upon the

normal hourly rate of th~ lawyers working on the file at that

time, which G & R agreed to pay and which amount H & F alleged

to be the reasonaple value of the services rendered to G & R.

9. H & F ha~ made demand on G & R for payment of the

sum of $3,670.55 but G & R refused and still refuses to pay said

f sum or a~y part thereof and is thereby in breach of its

If .

~~ contractual

li relationship with H & F.

\

WHEREFORE, H & F demands judgment against G & R, join~ly ll' 1. and severally, in the sum of ~3, 670.55, plus interest from II H ii March 18, 1975 and its costs and expenses incurred herein. ,. ,I il I' II li 'I II J II l 1

EVERETTE G. ALLEN, JR. ·AND CO-PARTNERS, et al, d/b/a HIRSCHLER, FLEISCHER, WEINBERG, COX & ALLEN

2

I

~-A~ . Hirschler,~~t:i!chef, Weinberg, Second Floor, Massey Building Fourth and Main Streets

Cox & Allen

P. 0. Box 12085 Richmond, Virginia 23241

STATE OF VIRGINIA

CITY OF RICHMOND, to-wit:

I, ~~P ~~ ;he City o~chmond, Virginia, do

, a Notary Public in and for

certify that.Everette G.

Allen, Jr., partner and agent for Hirschler, Fleischer, Weinberg,

Cox & Allen, this day made oath before me. in my City aforesaid

that JosephS. Goodstein·and Sheldon Ruben, individually and

t1:ading as G & R Associates, are justly indebted to Hirschler, .

Fleischer, Weinberg, Cox & Allen in the sum of $3,670.55, without

offsets,· for the consideration stated in the foregoing MOtion

for Judgment and attached itemized statement of account, and

11 that the same is payable as therein stated.

ll 11 Given under my hand this~~ day of August, 1977.

ii My commission expires: ~ C)--/'/-· 1 <g·

I! ll :I I~ ii.

3

I:DW .. AO 5 HIRSCHI.I:JI

Al.loH 0. P'L1:19C14C:A

.JAY M WEINB!:PO

It:)!!£ AT A . ..:OlC • .JR.

HIRSCHLER AND FLEISCHE;R

'ATTORNE''(~ AT LAW

2ND F'I.OOR MA:i~tY BLDG. A. SU4JI.ON WI\.\.IAMS • .JR.

MILES CAqv, ..lA

... OHM P', KU.&.Y 4TH & MAIN STREETS, RICHMOND, VA. 23219

\,, C:H4q\.ES LONG, """· I:V£AETT£ G. AI.LEN, ..lA

ALU.t.l :J. IIUVI"I:NSTCIH

_,OSEPH L. LI:WIS

AICHAAU A. AE.PP

"'OHM W. LEE

.1AMC5 A, "A0M.AN

IUCHAAO W. HOGAN

ltOB&AT A. KAPL.AN

CHAAI.CS "· WITTHOCI'" DAAAY A. HACKNEY

.IANI'S P'. ftASCAL

OANI!I. M. MCCORMACK

SUSANNE L SNILL.ING

Mr. Joseph Goodstein 317 Greenway Lane Richmond, Virginia 23226

Mr. Sheldon Ruben 404 Harlan Circle Richmond, Virginia 23226

Dear Joe and Shelly:

February 17, 1975

H & F Exhibit "1"

P'II.E NO.

Attached is a copy of Froeling & Robertson's.~nswer to our interroga­tories. From a reading of answer Hl(a), it is obvious that there will be a direct conflict in the testimony of Allan Buffenstein and Mr. Vogelsang at Froeling & Robertson. To establish the contract, it is going to be necessary to call Mr. Buffenstein as a witness, and this requires our with­drawal, as counsel, from the case. If you prefer, we will be pleased to assist in recommending new counsel and will of course cooperate with the preparation and, if necessary, the trial of the matter.

After reviewing this letter and the enclosed, and discussing it · among yourselves, please give me a call.

ECAJr/shs Enclosu:-es

Very truly yours,

Everette G. Allen, Jr.

4

H &.F Exhibit "2" 2570

74.0601

~ d': a Aauociatea ·. . . . ": . . . .. ~ ... ~·. ~ .. c/ ,..__t_.._.,_ ~ ft.~·.:· .. .. , .. " o }'J.easrs. ~~ ~ ~~ · · .

. ,. 404 liarlan Circle ··· ·: ·.· · RiclJ:I)o:l, Virginia 232.26

cl.a.1.m QGD.inat Ftoehl.1Dg & P.obertaon

·. . . \ . •·.

. ~

I .. , ·J. . . . .;·

II I t., • ' • 0 ·' ., • • • •• ••

i ,~ • . . . . ····~.

Legal scrv.lces rendered 'In connecd.on \doth Gbova, apclC1fically intra-office conferences J initial ueednga with :~ears. ttu1Jen and Coodsteilll rovis of files; contracts, plats, etc:. a ~ visits to site with l~ssrs. Coodstein,fit-rard, 1>\lorak, Froehl.1ng a Robertson, etc.' prel1mf.nary legal rescarcl&J con~ ccn­feralCeS ldth cl.1tmts1 mttars re il'l'Jal·.~:r~nt of architect, en-. gi.naer, ao1ls ~a, etc.; cc:a!.in.Jia~ deal1..~ with FJ:oeh­ling & Robel:taona receipt aa4 rev.tcw of subsequent mportsJ efforts re tfr. l'.cDClzrea cctu:inued lagol1:tmearch re theorl.ea of. C~J~JSe of action, ~ltsr.s with dCJmages, statuto of Umltaticns, . etc. 1 prepa:aticb aad fiUDs of DDtion fa: judpenta contf.mJe4 .... ~ confuencea with l-ttsars. Goodstein and luben; continued intra~·· : offico couferencea; matters re Mr. Uoncuro,. ppepuration and · fil:!."lg of interro&ator.l.ea i other d.scel.lanecus matters re 'With• drmwal £rem case, all aa la)re fully set forth on attached ~ ~ pJ:intcuts • •. • . • . • • •..• ". . • • •. ~ .. • • • • . •. : • ....... ·.• . • • .•. . . . . . . . .

• ~ • • • 0 • •

. r ' ·.r. . .• 0.: • -.. • • • - ;•.

CXlStS ADVI.liCEDa .. ·- · : : ... rt·.-: ... '· ~.-:o.·_~ .. .... 0 !'' • ••• •• I • '•' o. ' ~:---·~•:-;• • ' ·: ·~·~. •

$3,600.~

5

2570 14 G & R ASSOCIATES C/0 JOSEPH GOODSTEIN ·- . . . . 317 GREENWAY LANE RICHMOND VA

.-----.. ....... ., •••• --~··· •• --·.. • ........ ·--· •• - •• ·--·--. 0 ........ - ..... ~ ..... 0 • • ····-··-

74601/00 6/30/74. ·. H & F · C LAI l~ AGAINST FROEllNG & ROBERTSO.N

DATE 0 E S C R I P T I 0 N 0 F 6/17/74 CONFERENCE

. -··------- -·-· _, ···.-··--·-··------ • .. .... --··-. ... . . C L I EN T S R W

--· ------------- -------------- .. 6/17/74 CONFERENCE

JG SR EGA ASB JMW 6/17/74 CONFERENCE

• GOODSTEIN - TO PR'OPERTY . . . 6/17/74 CONFERENCE .

-·--····-----------·· . GOODS~EIN RUBEN ET Al 6/17/74 TELEPHONE CALL

. REUGEN PLUS JMW ---------·-·- --·::--·----·· ... ···--·-.. ·-· 6/.18/74 CONFERENCE .. ------------------------------------------------------------------------

W DVORAK 0 WARD 6/18/74 CONFERENCE . -.. -· . EGA . . .. -·--·--. 6/19/74 TELEPHONE CALL

WD JG ... 6/20/74 LETTER

PLUS JG TELEPHONE· 6/27/74 . LETTER. . ..

DVORAK .' ·. · - .

CTJ

C H A R G E S

~ 2?

I J,•T nO L: a. . .• J ll • t

. Cl.IE~:: ID:

t;"\

2570·. 74 .o6(

11~4~~U ~LUV~~~~ ..... •),

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-DA·T-~ ··---- ··-·· ATtY·- .. ·-----·-·-c·oo·g-··-·sGECD .. EX~LANATIO!f··-···---:-·-------·-_..;..-

~--------- --~-- --------------------~-~----------------

06-/30/74--- -·iss··----------,-----_--,- -·-g·.9- ·-cc"mp-ut.er-co:iver~ronliiibll~eCf as of 63o'

----o-67 j(fti4 ____ ....... ··cr~c· .. --· --13 -·-·--,.---9 s·-co.mpu ter ConversloilU-nbillecfas of 6307

06/30i74 EGA 14--·, 99-Computet: ConveJ:sic,~ Unbilied as-of_6_3·o-·/

07/01774 EGA. ·. 14 . 1 12 ·. Conference Clients plus 'AB, ·~vorak

07/01/74 EGA 14 1 12 ConferenCe HLS

07/02/74 ·--EGA --rr-·1 37 Telephone-call ~ Local · HLS, SR

07/05/74 -- ····--E~GA 14' 1 . 37 Telephone call - local HLS,Dvorak

o11oai1" --icfi--·--·nr-~·-,...--,-2-~t:t\er - . ·.·' ......

07/06/74

07/15/74

07/}6774

o·111e114

EG-A

ASB·.

,~ ..

• ASB

AS I!

07/22/.74 ASB

--o772'2i"74 · --,s·B

: 0.

• 14 1

7 .· 1 .. ' .. . ~·. ..

,. ' .. 7--, ,. 1

. ~. !··

7 1

1i

37

37

. ... :

. . . . :·~. ·:.

conference · ----HLS

. ,· teleph9ne call - locai : · · goodsteir. & memo to· file. & 1 f & r.. :.· .. : . .• . . . . . . . . ': . ; . ,,: •· ... . ..

Telephon& call - Locai Ruben

37 · ·: telephone cafl - local· ·:::·r~. ·: ,

. . . ~ . ... :.- lluhe·n ··.( 2) &. EGA ~:ei _._. F&R .::... ... . ... ;··· ...

: t :. I: . · ...... . . ... ' .. ..···. .. . . 37 .. - T-elephone call - Loc:ai

Vo;elsa~g & Ruben (2)

1--1--·-42·-----Other . . .. · vant site on .Darby town Rd." etc, · ..

o'fi 3ol"14 ___ _ ..... "iss-·····-·,-···:·-·-, _1_9 ____ b.oc\fmeii"E-tte'\'.few . ··----·-....:..__:_ __ Report ~com F & R & TC Buben

-oalo17-=l4 _____ ·--- ·Asa----.. ·-·1·----~r- -- -37 -...... Te.feptione·c:-a"Il-..:.--to·e:-a'l---·-· -·---. Ruben (2)

. . ---·- ____ _..._. _____ , ........ -.__..... ..... ----.. ....-.. __ ._ ... __,_.. ...... - ..... __ ...... ......-. ·- ·-·-······ .... ··-·-----·----·--· ... - ... -.·-~-----......

7

t;tt·TROL : • . . . . . C:CIE :~T ID:

·!0 r'\

2570.74 .a&( 'I .

J.·i~L.t;~ ~t;t<V J.t..~~ ... J.

(

·-DAtE -···--- .... ATiY··--·---·-c:c·o~£~ susco··. tfi'LAN'A"ifcii--··-··- .. ·-- ---·- --·.-··-··----.

---------- ----- -----~--~----------------~-----~-----~-. . -o-a-;·c2i14 ____ .... ASS------,· ···---f .. - .. ·f2 ...... ·- co'nferenc'e' ... __ .. . -·--·--··-· --- ..... -------

EGA· . . ·oelc-2/7·4-· ---·· ci·w --_f3···--,--.. --·,2-·- ··c·oii£erence--~-··------- ______ .;,__ __ _

ASB - F & R claim

-·----O~/C2/74 EGA 14 1 12 Conference

ASB I

oa/o3i74 EGA 14 1 23 File Re-vi-e-w·------:--plus ASB,:ltr to clients

08/05/7U EGA 14 1 ·37 Telephone call- loca~--·--·

SRplus ASD

·------. ·- -------·- --·-·-- ·----· ----- -· -~----------.._..._... . ._._..._,__, -.-. ...... 08/0o/7~ EGA 14 1 42 Other

OS/Oo/74 !sa-.--·-" -;··---,---·1·2- confe-rence------------------- ---ETA, Gccdstein & Fuben

oa/os/7~ ic"K ---,-4·--. ·;·--:r2-·--c-on!e·rence-----·: - --·· SR.,JG, AS.~

... OS/0~/74 ASB 7 1 12·· · ---con£.erence- ------

Goodstein, Ruben, JMW, EGA, & Witt

osi~o~/7~--.-EGA-·-;·4· ···--.. 1 1-2-··-coiif'~reiic:e·-;---···---w.-·--- ;._ ---·-liitt, clients, J~l\ ·

11/·o·s-174-:· ~:·ci.."·-----·iii-· ---, is---t-etter:--·--·-~------·--- ---:-., Moncure, JG

. . 1·1lf9/74. -· 2'G .. A ... -. --;4··-··~-- .. -,----····;2·-:---c:on£-ei:ence----.. ------·-:------.·---:--. . . . . . bah, jmw plus telepho~e. . 1.1/1.9/"74 BA~-- 16----,----;-~·-·-·c-6"ii£-6rence·--····-: ·---- -----

1 e~a · .. - ·

1.1/20774 ·- a·AH--.--16 ..... -,-- ----,-~r-·-J>-oc'l.wnent-!fe·v.te·w-----~---·----:--··--=---

. · ......... _ .. file and research ·

,,,2-7/'74·--:-··aAH _ .. ____ 16 .... -~-1··-·--·Js· .. __ Eies.eircil ___ .... _._ .. ··~-- -----· .. ··-·· ·- --.. --·----

1.1/29/'i4 ____ _ . dama~es - suit against enginee~s etc.

EGA 14-.: "1 .. _, "12 · ·c:onf"erence bah

-·--··-· ........... _ -·- ... ·-· --~ _._ .•.. ..,_-

...... ··-·---- .... -·-----·· ----··- .... ·-· - ····-· ----· .. ·-·. -· ··--···--···-· ---· --- ....... ~--. ._----

··-···. ·~··-·--·-·- .. ··-· ···--- ---····-·-- --·· --·----·· -~·· .8

---------------·=----~ ·---··· .. -----··-----·--··------------··---...;_·--

N '\ RO I :: · : .. . · : d . . . lTF""'-ZZIJ SEa VICES ... wL .. -CLIEt;'r ID: 2570.74 .060(-.

'I

. . oA7F.: ______ ATT-Y----.-c-cn>~-sus·co····£x1fi:!t:KrxoFr-

---~------- ---~~ -------------------~-------~-~------~--­. ---,--,y2q,;;.--·-·--~- s·As·--T6--,---~-,2---·con£-e-rnce

ega

· o 1lo-2/7s·-·--····aifi··-- ·1·6- ---,---~--12'"- ---c:o·nf'ereiice ega - pleadinqs

. .. ·a·iloiiis _____ ··aiii ......... ·-·~a6 ____ 1 ~-·---12-- -c-c;·n£e.reiiC:--e·----:-·---··--------

Ol/o·2-i~7S

0 1/03}75

01/Cj/"1s

0 17if6/.1S ... .

~oodstein ... and rubin . . . ·As·s--·-r-7- ···;-----,-g-~----- Doculient aevrev--:-··.----- ---·

mj

·As if 7----,-. --,2-c·onfe-renC:e ·· bah, aj ·theory of case

BAH 16 1 12--confer-ence alan_b. research. pl~adi~g

BAH---,6···----,--32-Pre'Para·uon-of'"""'tourt-Pap·ers f . ' I' '• .. ' ,' • o m J . . "'·. . ..... ··, .. .. .

.:. .

. . .. • " •I . ..

o 1/17/:t·s----· s·JfH---·- f6---~---,-· ·-·3·2---PrEipara ffaii. of Courtiiapers · intet, me to prod cntrcl,rev,f&r pl,eva

t· -0 11-22"715 --E-GA-·--;-4 ·-·-··1-4.--12 . c·on:E'erence-·--. -----:--: ··:· .. · . .

bah plus goodstein · · · ·. ·· ·: · · · ·=·:·· .··

o-il.2il15----·--· BAH -·-·-··;·6·-.. ---, 1 ~----··· .. con£e~-n-c-e-~--------­ega

o 1t23l7s---.-·tfi:tf---;-e---1--·--.J·r---feieiJ-ho-necali--=--rocal:--moncure, ruben ~

·-----· -------- -· ----------·~ ·-----~ -·---------- ·------------

. ---____ ........... . .......... -- •· -· --.. - ··-·-·---------·-· .... -. --···------ g: .. . · .. . ..

. • ~ ~· . .. :

~jN t KOL !: ·~ .. 0 • . .

"CliENT ID:

-DATE·-···-··--·---A"T1'Y - ...... - ........ _____ _ __ _. ____ _

~~---~---~-~---------~-----~------·-1 . . . 16 -··--;----,.9 ·- ···- liocunie.ilt.··- se_v .. fe~ ------..------

ans, to interrog. and

14 ·--1---28-·--:Letter--··­memo bah

·aA1i--"16---1--·37 __ .... Tele"-liOne-·c:ail--ioCil ruben

memo

-------- ------ . ··------·-·------ ----···----------

-----·····--- ...... ··----. ···------..-.-...--...... - ... ___ . __ ......__, ._ ..

·- .... __...... .... •··· ·- -···-·-·-·· .. -..---- ··-·-.. ·--·-··- .. ·----···--------. .._.__...... .......... ~ ----- ~._._....

-·-~--·......_ _____ _,__ •.. ··----------·- -···· --.--··· .... _ .. ·--· ·- ··~·-··- -----·~··-.. -------·-· _.___.. -·-··--··· --- ·------···--· ..

___________ _.____......_....__ ··--··-· --~----· ----·-------··------- __ .. ______ .. _.. _____ ----·---....... ,..._._... .. __.. ...... ..._._

-.-------·· -·------ -··- . 0------ ·-.. -· .. -··--. ·-· . ·-·-- .. ----... ·-----··---·.·----·-----

------ -·····- ·--------... ~- _._.,_...,.._ .............. __.. .. .....,. ___ _

------------------------~-----~-___.__·-------------~-------------------------------------~-- · .. ·.

: -,-

·--------~.-----... --------·---· :·· ~ .• . ;

... ....

.·

··.

.. _____ ..... ~ -···----- ...... .._..,__. __ ...... -·-·---· --··· ···--·---·-----..................... __..__.. ................. ....

--- -----····-·--..... ··- ~--··· -- -· . --.--····-..- ... ·-----..

·-----··-·-·- -----· --·---··-----· ..... _ ·----· ·-- ... ------·---- _....,_.. ---· ---·....-- . ··--· ~

10

PROOF OF SER.VICE CS132011

llirginia:

In the Circuit Court of the City of Richmond, Division II,

LAw N o •....... ~:J~.?.::.~ ... Everette G. Allen, Jr., etc., plaintiff,

vs.

Josephs. Goodstein, indiv., etal~ defendants,

Returns shall be made hereon, showing service of Notice issued ___ 8_/_8_/_77 ______ _

with copy of Motion for Judgment itled _____ 8_/8 __ / __ 7_7 ________ ,.attached:

SERVE ON: Joseph S. Goodstein, ind and d/b/a G & R Associat 317 Greenway Lane

Sheldon Ruben, indiv. an d/b/a G & R Associates 404 Harlan Circle

:."'y l''' 'l!'i(··-,. '•J"".: • ~L-' ... ! r, ... , {0:: ·.u•.,.;.J,r.a . . ..J ve. . ~ .. d u:J;ij;jf. ~')· _ n •. •-•~ .. ···;z:. .. ~ .... ~ ............. q__ .. _f;~£ ~.: ...... b.r-'., ro.~/t(.~ .... ~f.cO'-··········~~ f. •.-:::-:-1t~=R C•· .{ ~~ •=-~r.' L'' .-:·-.·:··~ ·rr;r.:- ·"=' ,..'=" \ ., .... i, u.... .~k-r.:; .....•.•.••• t •• ~;"'\ ' ... &.;. u. s:x r tEN Y .:. ~:~;; ;..~: . • ;~.: i".Jffi"'Joln o.= SAr~t1E r: ........................................ -..................... , ... ~ ..................... ..

ANPR.:: h J. \tV&NS1"0N, ~: TY ~~EA:·~T

BY: ......... s;;j2..J.. .. ~riiPiiTY''SERGWif~":,.

SI;RGE'ANf'g FEE tr.A ..s-0 0 a. .. .,.,,.,,.,"/..,.. ~IAI 0 ,. F - 7 7 .............. --... r,

~....;.

AUG 9 1977 Returned and filed the .......................................... day of ................................................................................•

. . .~-~--~:~--~·~ .............. , CWk. 11 ~~.tJ.: .. _C.r .... ~ .. ,.:,;;.'="···· .... , 1hpuly 2Je'k

. ORDER

This day came the parties, ... by their counsel, and

epresent unto the Court that they had agreed that the time

ithin the defendants were required to file responsive pleadings

ould be enla~ged to September 12, 1977, for reasons being

ufficient to the parties, and the Court findi~g it proper to

o ~o,

It is ORDERED that the time within which defendants

.ay file ;respons~ve pleadi~gs in this case, be, and the same is,

:x:tended to September 12, 1977 •·

~TERED this/~l~ay of~ , ;un.

EEN: '

#a'!Uf A t/kc d(J;tf arry Hackney, p.q. (

12

. GROUNDS. OF PEFENSE

.. GROUNDS OF.DEFENSE AND COUNTERCLAIM

Come now the defendants, by their counsel, and state

the~~ grounds of defense to the Motion fo~ Ju~gment against them

as follow$:

1. ~ara9ra~h 1 of the Motion for au~gment is admitted

2 •. Pa~~graph 2 is admitted.

3. Pefendants admit that on or about June 17, 1974,

they ~et with ~llen to discuss H & F prosecuting· a claim in

the~~ behalf ~ga~nst Froehlin9 & ~obertson, but assert that the

pro~ecut~on of this claim was a ~a~t of tPe continuin9 re~re­

~entation of G & R by H & F on the real estate matters o~~ginal­

ly undert~ken by H & F in behalf of G & R in June of 1972. In

all othe~ respects the all~gat~ons of Paragraph 3 are denied.

4. The allegations ot P~r~9rap~ 4 are den~ed.

5. Defendants admit that duri~9 the per~od quoted in

Paragraph 5, Allen and perhaps certa~n other personnel of H & F

made some efforts and took some steps in the investigation and

prosecution of G & R's claim against Froehlin9 and aobertson.

However, during this same period of time, Alla.n S. Buffenstein,

an associate of H & F, knew that he had been guilty of breach of

contract and negligence against G & R in his initial work on the

real estate matters in the summer of 1972. In addition, he knew

th~t he had committed an actual fraud against G & R in the

p~ocess of handling the real estate matter and conducting .a real

est~te.clo~~~9 with G & R in October, 1972. At no time did he

I

di~c.lose this.to G & R, and insofar as G & R have been able to

dete~ine, he ap~arently did not disclose this to Allen, who was

WQrking on the matter ot G & R'~ claim ~gain~t 'roehl~ng and

Robe~tson •. This_guilty knowled9e of Buffenstein and thelia­

bilitr fo~ his acts are imputed to H & F, insofar as Buffenstein

w~~ an a$soci~te atto~ey -~n that law firm acti~g within the

scope 9f his-employment at the time in qqestion. (At some

point, Buffenste~:n became a paJ;tneJ: ._in the law firm, but the

ex~ct date ~~ not known to G & a.) Therefore, H & F did not

"inve~tigate and ~rosecute G & R's claim ~ga~nst Freehling and

Robertson" as properly it ~hould have~ because of Buffenstein's

b~;eac;:n of contract, n~9lic;rence and tr~ud, and to the-extend that

the alle9ations of Par~sraph 5 of the-~Qtion for Judgment are

intended to imply that the invest~gation and prosecution of

G & R'a cl~im ~sainst Froehling. and aobertson was proper,

thorQ~9h, dil~gent and ethical, the alle9ations of Par~9raph 5

aJ;"e denied.

6. The alle9ation$ of f~~~~r~ph 6 are adm~tted,

except that Exhibit "1 '' is <!a ted Februa;r;y 17, 1975, not 19 77.

1. The all~gations of ~a~ag~apn 7 a~e admitted in­

sofar as the statement was ~endered to G & ~. G & R deny that

the ~tatement was for services properly rendered and legally

cha~geable ~gainst G & R, and say that the statement was pro­

vided on March 18, 1975, not 1977.

-8- G & R have insufficient info~ation about the

basis of the statement of services rendered, as alleged in

Paragraph 8, and must therefore deny so much of the allegations

as reg~rd the basis of the statement. G & R deny that they

a~~eed to pay the hourly rate of the lawyers working on1ite

file. G & R deny that H & F all~ged the amount to be the

~easonable value of ~he serv~ces rendered G & R.

9. As to the·allegation~ of Paragraph 9, G & R admit

that thef have refused and still refuse to pay any sum for

se~v~ces of H & F, $!nee no fees are legally due. G & R deny I

that this ~efusal is in breach of any contractual relationship

with H & F.

10. The breach of contract, n~gligence and fraud of

All~n auffenstein, .imputable to H & F and all of the partners of

H & F, includi~9 ~llen, constitute a breach of the attorney­

client relationship and the att9rney-client contract between

a & F and G & ~, and constitute ~ bar. to the claim of H & F for

le9al fees cha~9eable against G & R·~s alleged in the Motion for

JtJdgnleni; ..

11. The knowle~ge and action$ of ~llan Buffe.nstein

con~tituted ~ conflict of inte~est by which Buffenstein and his

law fi~, H & F, and ~ts pa~tner~, were legally and. ethicAlly

b~r~ed from representi~g G & a in pursuit of a claim against

Froehli~9 and Robertson, (hereinafter $Ometimes referred to as

F & ~},since the actions and knowle~9e·of Buffenstein woul~

conatitute ~full or p~rtial ·defense·by Froehlin9 and ~obert$on

to the cl~ims by G & ~, and becau$e the actions and knowl~ge of

Buffenstein rendered Buffenstein, H & f and its partners liable

to G & R fQr b~each of contract, ne9ligence and/or fraud.

Therefo~e, it was imprope~ for H & F or ~ny of its parte~~ to

re~resent G & R because of this contlict of intere~t, and no

liab~l~ty ~or legal fees can arise from any such relationship. f

12. To the extent that any attorney's fees m~9ht have

been e~rned by any of the plaintiff$, they are offset by1~ages I

I

owed to the defendants by the plaintiffs on account of the

breach of contract of the plaintiffs and their agent, Allan F.

Buffenstein in regard to the legal representation of G & R by

H & F on the land matters in question.

13. At the time in 1974 that Allen negotiated with

G & ~ for the continued representation of G & R by H & F and the

pro$ecution of the claim of G & ~ ~gain~t F~oehling & Robertson,

Allan Buf~en~tein knew tha~ he would be an important witness in

~ny l~gal proceedings by G & a ~gainst F~oehl~ng and Robertson,

~d this ~nowledge o~ ~llan B~ffen$tein was imput~le to the

other pl~intif~s in this case. TneretQre, the pla~ntifts were

ethically and l~9ally. barred from ~epresenting G & R in its

cla~m ~ga.in~t Froehling ~d Robertson, ~nd G & B are not legally

liable f.Q~ any fees arising out Qf such a relationship, since

tney h.ad no knowledge of Buffensteins's actions and knowled9e.

14. Following the closin~o~ the real estate tran~­

~ction Qn October 3, 1972, by Buffenstein, Buffenstein, by acts

~d Q~issions, in violation of his attorney-client relationship

w;th G. & ~~ willfully refrained from disclosin9 to G & R breache

of contract, neglisence and ~~aud of which he had been guilty in

h~dli~9 the l~nd transaction fo~ G & ~f and continued up unt~l

the p~e~ent date of the fili~9 of the~e pleadi~gs to cover up,

hide and m~ke s~cret his act~ons ~d knowle~9e in that r~9ard

fo~ the pur~ose of dete~ring G & R f~om di.scove~i~g his w~on9-

do~n9~ and obtaini~g l~9al red~e~s against him and H & F for

these w~o~gs. These fraudulent coveru~ actions by Buffenstein

~re imputable to all of the plaintiffs.

· ·coUNTERCLAIM

15. For ~nd as a part of its counterclaim, the 16

defendants inco~orate by refe~ence Par~graphs l throu9h 14,.

above, ~s a p~rt of thi$ counte~c1aim.

16. This counterclaim is asserted against the plain-

tiffs, jointly and severally.

17. The nature of this counterclaim is a claim

solely for breach of contract against the plaintiffs for their

representations of the· defendants in certain land transactions

duri~g the period of appoximately June, 1972 through February of

1975.

18. On June 5, ~972 the defendants and D~rbytown ~oad

A~sociates, ~ Vi~ginia partner~hip, entered into an agreement

whereby defendants agreed, subject to satisfaction of certain

cond~tiona, to purchase from Darbytown Road Associates appro­

xim~tely 53.88 acres, of land,. s~id real est~te bei~9 located on

Darbytown ~oad, Hen~tco County, Vi~gini~.

19. G & R e~9~9ed attorney Jay M. Weinberg and his

l~w fir.m, H & r to represent them in the pu~chase of the afQre­

mentioned property, and tQ aavi~e them on ~11 aspeets of the

acqui{:Siti.on of the property.

20. In late June or earl~ July, .1972, G.& Rand

Wej.nbe~g v~aited the property in question and, follow·ing a

cu~~o~y exam~nat~on of the p~a~e~ty, Weinbe~9 adv~sed G & R that

ther.e ~ppe~red tQ be potential ~roblem.s with ~e pro~exty

relat~~9 to fill dirt ~nd ~in~n9 which may have been conducted

in the pa~t. W.einbe~g recommended that they obtain a geological

survey of the property for the pu~ose o~ asce~taini~9 whether

tne J?X'QVisiqn::s of J!~~9_raph 4 tel of the purcl.lase ag-reeJllent h~d

been ~atis.fied.

21. B~sed on the dl$cussiqns with Weinberg, G & R . . 17

in~tructed him to obtain·the be$t geological advice available

with reg~rd to the provisions of. ~arag~aph_ 4(c) of the purchase

a9~eement and to spare no expense in doi~9 so.

22. ~n July, 1972 Buffenstein, on inst~uctions from

Weinbe~9, en9~9ed Froehling and Robert~Qn, Inc. to make an

examination of the property. In order to comply with the

requirements of Paragraph 4(c) of the purchase agreement, said

examination should have ascertained and determined whether any

fill dirt, underground rock or streams were on the property

which would increase the cost of construction for industrial use

as opposed to the cost of the same construction if such items

we~e not p~e~ent.

23~ Buffen$tei~p~ovided F & R·with a zoning section

sheet ~lat o~ the property.

24. At the time Buffenste~n obta~ned the afo~esaid

~ervtces of F & ~ on behalf of G & R, Buffenstein realized, or

should h~ve ~ealized, that any failure .on his.part to secure

competent ~nd adequate services for a complete examination of

the ~~ope~ty pu~suant to the afo~ementioned Par~sraph 4(c) of

the pu~chase ~g~eement would directly ~esult in G & R suffering

$ubst~nti~l dama9es.

25. At the time Buffenstein obtained the services of

1 & ~~ he eitner ~ealized, o~ ~hould have ~ealized, that if a

dispute ~rose at ~o~e time in the ~utu~e a~ to the report

rendered by r & ~ on the p~opert¥, it would be im~ortant to be

able to p~ove ex~ctly what inst~ct~ons F. & ~ rece~ved from him

a~ counsel for G & R, and to be able to snow that F & R.failed

tQ comflY with the instruct~ons p~o~e~ly. Buff.enstein real~zed, •'

o~ ~hould bave re~lized, that ~uc~ ~n~t~uctions should bel~

w~~ti~g to~ & ~pursuant to. good p~actice, cu~tom and us~9e,

and the exe~cise. of pxudence on behalf of G & R.

26~ Buffenstein, contra~ to the instructions from

G & R, only en9aged F & ~ to make a c~sory nwalk-over" Qf the

prope~tY. fo~ a minimum fee of $150. He knew, or should have

kn~n, that $Uch an examination by F & R would not satisfy the

requirements of G & R and would not result in a reasonable

inspection to assure compliance with the conditions of Paragraph

4(c}·Of the purchase a9~eement.

27. Buffenstein only engaged F & R to make a "walk-

over" examination of the property by one man, and told. F & R

that only a cursory examination was desired.because money was a

problem: Buffenstein "pled proverty" on behalf of his clients,

G & a, w~thout their knowledge and with the full knowledge that

G & R could have and would have paid any reasonable fee required

28~ On or about A~gust 16, 1972 F & R provided

Buffen~tein and G & R wit~ a written report to the effect that

there was no fill dirt pre~ent on the property.

29. F & R char.ged G &. a $150 for perfo~~9 said

contxact and G & ~ promptly p~~d the same.

30. On October 3, 1972 at the closi~g of the trans-·.

action ~n the offices of B & F, Buffenstein fe~9ned a telephone

call to w. H. Vogele~9, agent of 1 & a, ~nd reported to G & R,

whQ we~e ~re~ent with Buffenstein ~t the time he was m~i~g the

phone c~ll, th~t Vo9elsan9 waa on the other end of the telephone

conve~s~tton ~d that V~gelsa~g had just reported to Buffenstein

th~t G & a ~could bui.ld a twenty ~tory buildi~9 on the pro­

pe~ty."

31. In ~~ct, w. H. Vogels~i never made s~chjfgpre-

sent~t~Qn to Buffepstein, and Buffenstein made the representa­

tion to ~l~int~ffs in order to conceal his n~gliqence in the

m~e~ tn wh~ch.he had obtained-the ~ervice$ of 1 & a ~nd his

ne9l~gence in the ~nner Qf a~ce~t~inin9 w~ether the cond~tion~

Qf ~~r~9~~ph 4(cl of the purchase a~reement had been satisfied.

32. At the ~ame clO$i~9 with G & R, Buffenstein

verbally ~dvi$ed G & ~ that he had made investigation of complt­

ance w~th the conditions of Paragraph 4(b) of the purchase.

agreement, when in fact he had made no such investi9ation of the

teXlne~ of PC\rp.graph 4 (b) •

33. In_9ood faith rel~ance upon the advice of

Buff-enstein as their lawyer, and upon his representations that

he had satisfied himself that all of the conditions of the

purchase agreement had been met, G & R closed the transaction,

purchased the property in question and caused the deed to the

property to be recorded in their names.

34. Subsequent investigation ascertained that the

conditions of Paragraph 4(bl of the purchase agreement relating

to the av~il~bility of sewe~ facilities wer.e not satisfied, and

that Buffenstein had failed to ascertain that the conditions of

Para9raph 4Qb} bad not been ~ati~fied prior to advisinq the

plaintif~s to close the trans~ction on Septelllber 26, .1972.

35. Follow~~9 the clo~in9 of the t~an~action on

SeJ?telllbe;r 26, 1972, Weinbe~9, ~utfen~te~n and H & F, or some of

tnem, jointly and seve~ally, intentionally and with intent

to defraud G & ~ entered into a cou;rse of conduct designed to

conce~l ~rom G & R tne n~gligence of .. Weinberg, _Buffenstein and

H & ,, to aet~aud G & a of their r~9httul l~9al recovery against

H & F in the handli~g of the real estate t~ansaction, to cover 20

up the n~9lfgence and breach of CQnt~act in such a way as to

deny G & a recovery, ~d to delay G & R.beyond the statutory

pe~tod of limitations within whlch G & ~ could obtain recovery

~9~inat ~~~d H & F. $aid intentional ~ctions and materials

mi~representation~ by H & F included, but were not limited to,

the followinc,J: . I a~ Continui~9 to as$ert to G & a that Buffen~tein had I

~e~ue~ted F & a tQ do ~ thoro~sh ~nvest~gation without r~9ard to

coat, when, ~n fact, this wa~ not true.

b. Continui~g to as$ert that w. H. Vo9elaa~9 had

represented to Buffenste~n by telephone at the time of the

closi~9 that the prope~ty was capable of su~~ortin9 a twenty

story build~~9, when, in tact, this was not true.

c~ CQntinui~9 to ~epresent to G & R as counsel in

the face of obvious conflict of interest between B & F, on the

one hand, and G & R, on the other hand, to include the filing of

a motion for judgment against F & R in January, 1975.

d. Failing to withdraw as counsel from G & R i~e­

diately upon having knowledge, actual or constructive, of the

negligence and breach of contract of Buffenstein, Weinberg, and

H & F.

e. M~sleadi~g G & ~ by words or action~ in~o fore-

90~~9 o~ delayl~9 their obtaining competent legal repre~entation

to ~~~e~t cla~ms ~9ainst .H & F until some of the periods of

l~tattona of ~ction~ against H & F by G & R may have expired.

-t~ Other. divers acts, words or omissions which were

intended to, and in f~c.t·did, .. lull G & B. into a sense· of

~ecurity with H & ~ a~ their counael, to the great detriment of

G & a, and in violation of H & 1's contractual, legal and 21

eth~cal obli9~tions to G & ~.

36. ~$ a direct and fo~eseeable result o~ the failure

of H & F p~ope~ly to perfor.m their cont~act of lesal re~resenta­

tton, G & ~ bave been dam~ged and ~ave incu~red substantial

e~en$e~ in the ~urcha$e, p~y.ment for, and attempts at orderly

$~le of s~~d pr9pe~ty in order to miti9ate their damages, and in

othe~ fore~ee~le dam~ge~ •

. 3 7. ·~~ ~ dix-ect and fore~eeable ;re~ul t of tlle breach

of contract of H & F in coveri~g up and conceali~g their negl!-

9ence, b~eac~ of contract ~nd fraud, G & R have been damaged. and

have tneu;r~ed substantial expenses in the purchase of, payment

~o;r, ~nd ~ttem~ts at orderlr sale of said p~o~erty in order to

miti9ate their damages, and in other foreseeable dama9es.

WHEaEFO~, G & R pray that the Motion for Judgment

ag~inst tnem be dismissed, that they be awarded dama9es for

bre~ch of cQntract ~n the amount of $140,000.00, and that they

be ~~anted any other relief to which tbey are entitled.

c. Lowe e and Gordon, Ltd.

9 Park Street

JOSEPH S. GOODSTEIN, and SHELDON RUBEN Individually and t/a G & R

Associates

By Counsel

Charlottesville, Virginia 22901 (804-296~8188)

PLEA OF STATUTES OF LIMITATIONS

Come now the plaintif~s, Everette G. Allen, Jr., and CoPartners,

et al., d/b/a Hirschler, Fleischer, Weinberg, Cox & Allen, by counsel,

hereinafter referred to as "A~len," and say that as to them the several

alleged causes of action stated in the Defendants' Counterclaim filed

herein are founded upon claims that are barred by the Statutes of

Ltmitations set forth in Section 8-13 and 8-24, Code of Virginia, as

amended, and were so barred before the filing.of the Counterclaim in this

action against the plaintiffs,

EVERETTE G. ALLEN, JR., and COPARTNERS, et al, d/b/a HIRSCHLER, FLEISCHER, WEINBERG, COX & ALLEN

sy·~~~~ Of Counsel

WilliamS. Smithers, Jr., THOMPSON, SA VAG~, SMITHERS, AND MARSHALL, 5911 West Broad Street, Richmond, Virginia 23230

: . CERTIFICATE • • •.; I #,• , • -~ • '

23

V I R G I N I A:

IN THE CIRCUIT COURT OF THE CITY OF RICHMOND, DIVISION II,

EVERETTE G. ALLEN, JR., et al, Plaintiff,

v.

JOSEPH S. GOODSTEIN, et al, Defendant.

. SPECIAL PLEA IN BAR TO COUNTERCLAIM

Come now the plaintiffs, Everette G. Allen, Jr., and Co-partners,

et al., d/b/a, Hirschler, Fleischer, Weinberg, Cox & Allen, by counsel,

and state that the defendants are barred from prosecuting their counter-

claim for the following reasons:

(1) This action is barred by doctrine of res adjudicata in that

the final judgment re. ~ered in the case of Joseph S. Goodstein, et al,

etc., v. J. M. Weinberg, et al, filed in this Court as Civil Action No.

10108-L is conclusive upon them.

(2) This action is barred by the doctrine of ·Election of Remedies

in that the defendants had an election as to whether to prosecute their

claim against these plaintiffs in tort or in contract and having in the

case of JosephS. Goodstein, et al, etc., v. J. M. Weinberg, et al,

elected to prosecute their clatm as one in tort and having prosecuted

this clatm to final judgment are prevented from bringing the same claim

under the theory of 'contract.

WHEREFORE, the plaintiffs pray that the counterclaim filed herein

be dismissed.

al,

WilliamS. Smithers, Jr., THOMPSON, SAVAGE, SMITHERS AND MARSHALL, 5911 West Broad Street, Richmond, Virginia 23230.

CERTIFICATE

I herepy certify that I have mailed a copy of the foregoing pleading

to John C. Lowe, Lowe and Gordon, Ltd., 409 Park Street, Charlottesville,

Virginia 22901, counsel of record for the defendants, this ~~ day

of October, 1978.

r MEMORANDUM IN SUPPORT OF PLAINTIFF 1 S PLEA IN BAR TO DEFEND~ 1 S 1 COUNTERCLAIM

To the Honorable Judges of the Aforesaid Court:

T~is case is controlled by the doctrine of Election

of Remedies and Standard ·Products v. Wooldridge, 214 Va. 476

(1974). The defendants seek to recover for" ••• breach

of a contract against the plaintiffs for their representation

of the defendant in certain land transactions during the period

of approximately June 1972 through February 1975." (Motion

for Judgment, paragraph 17).

The defendants having had at one time concurrent remedies

for the same alleged wrong and having elected to pursue. one

~of them, and having prosecuted his election to judqment, they

may not thereafter brinq the same demand on the other form

of action.

A comparision of the allegations contained in the counter-,

claim and of the allegations contained in. the Amended Motion

for Judqment of 9-24-75 filed in this Court in the case of

Joseph s. Goodstein and Sheldon Ruben, individually, and d/b/a

G & R Associates, v. Jay M. Weinberg, Allen s. Buffenstein,

Rirschler & Fleischer, Attorneys, A Partnership and Hirschler,

Fleischer, Weinberg, Cox & Allen, Attorneys, A Partnership,

filed in this Court as case no. 10108-L reveals that the claim

is the same as that set forth in the earlier action and the

parties in interest are the same. G & R Associates (G & R)

prosecuted case 10108-L to a final judgment in this Court,

which was affirmed on appeal. See Order of the Supreme Court

of Appeals of Virginia attached. In 10108-L, ~ & R set up counts in contract and tort.

On demurrer, this Court required G & R to elect between tort 26

I i I

l. I~ li

II I· ·I I

I I

I

and contract and G & R elected to.rt. Raving made such selectio 1

and having prosecuted the selected theory of recovery to final

judgment, the pla~ntiff is bound by his election.

In Standard Products, the Court cited Sangster ! Als

v. The Commonwealth, 58 Va. (17 Gratt.) 124, at 13~ (1866):

It is true that where a plaintiff has con­current remedies ~or the same demand, and he elects one of them and prosecutes it to a judgment, he cannot then resort to another, but is bound by his election, although it be a bad one •• • Therefore,. when A wrongfully takes the property of,B and sells it, he may bring trespass, trover, detinue or assumpsit for money had and received, against A at his election7 having elected one of these forms of action and prosecuted it to iudgment, he cannot then abandon it and bring another.

• • • It would be inconsistent to permit him, after· electing and prosecuting to judqment either of the three last named actions, and especially the last to resort to the first ••••

Standard Products, itself, was··the more difficult case.

There the plaintiff, having brought his action against two

defendants, Wooldridge and Finnegan with two counts, one

alleging a tort and other alleging a breach of contract,

• but both based on the same facts, and being properly forced

to an election under the then existing practice, elected

tort and continued the case generally, the plaintiff, Standard,

then filed a s~parate suit aqainst the same two defendants

alleging a breach of contract under the same facts as previous!

set forth. The plaintiff entered a non-suit against Finnegan

in the contract action and obtained a default judgment against

~iooldridqe.

Finnegan then alleged that the judqment against Wooldridge,

which remained unsatisfied, constituted an election of remedies

and barred further prosecution of the tort action ~7inst

I' tl II ,, ,I ,,

li r I! !i

I~ J! .. i

l i

,I ,, :I

li II ,. ji .! I' ij

I!

I ~ I

him. The Court found that Standard's filing of the contract

action amounted to its true election and having followed

it to final judqment, the plaintiff was not permitted to

proceed on tort even against a person not a party to the

contract action. They would be joint tort feasors with the

defendant in the contract action. .Had the plaintiff elected

originally to proceed in tort.

The Courts cited Roberts v. Moss, 127 Xy. 657, 106 s.

W. 297 (1907) with approval. In that case, the principal

which the plaintiff presently espouses was affirmed as a

defense of res adjudicata, whether the nomenclature is proper

the application seems universal. See qq A. L. R. 2d 1315.

The public policy supporting the doctrine of Election I

of Remedies like that of res adjudicata, collateral estoppel,

estoppel of judgment, multifariousness and splitting of causes

of action is that of social value of endin~ litigation and

an elemental view of fairness. G & R having had its day

in Court and having in this instance having taken its case

to the Supreme Court of Appeals of Virginia, should not be

allowed to relitigate the same issue •

William s. Smithers, Jr.

... EVERETTE G • ALLEN 1 JR. and COPARTNERS, et al., d/b/a HIRSCHLER, FLEISCHER, ~INBERG,

BycoxZj~ Of Counsel

THOMPSON 1 SAVAGE 1 S!1ITHERS & MARSHALL 5911 West Broad Street .·. Richmond, Virginia 23230

I

I I I . I

VIRGINIA:

f, t!UJ !J:Lj~Hme l&u~Jtt o/ "11-?nia /,Jd al lhe 9'up1tem8 ~~ f!Aui/Jnrp 1m, l~s

~t"~ ojgfic~nloJI.d on Friday .l~e 9th · t:la/1 o/ June, 1978.

Joseph S. Goodstein and Sheldon Ruben, individually and t/a G & R Associates,

aqainst Record No. 770373

Jay M. Weinberg, Allan s. Buffenstein, Hirschler & Fleischer, Attorneys, a

· Partnership, and Hirschler, Fleischer,1

Weinberg, Cox & Allen, Attorneys, a Partnership,

. .

Plaintiffs in error,

Defendants in eFror.

Upon a writ of error to a final order entered by the Circuit Court of the City of Richmond, Division II, on the 22nd day of November, 1976.

This day came again the parties, by counsel, and the cou~t

having maturely considered the transcript of the record of the final order.

aforesaid and arguments of counsel, is of opinion, for reasons stated in

writing and filed with the record, that there is no error in the final

order complained of. It is therefore adjudged and ordered that the said

order be, and the same is hereby, affirmed, and that the plaintiffs in

erro~ pay to.the defendants in error thirty dollars damages, and also

their costs by them expended about their defense herein.

Which is ordered to be certified "to the said circuit court.

Defendants in error's costs:

Attorney's fee. Printing brief - Code, s 14.1-182 - Not to exceed $200 for each defendant in error

Teste:

A Copy $50.00 I

•este:

?

VIRGINIA: .l'n th. !/up,_.. rc-t o/ "/1~nia kid at Me _%p.,eme ~ ~ m th. .

~·7 o/~~,J tJn Thursday I~B 31st Ja/1 o/ A~gust, 1978.

Josephs. Goodstein, et al., etc., Plaintiffs in error,

against Record No. 770373

Jay M. Weinberg, et al., Defendants in error.

Upon a Petition for Reheari~q

On consideration of the petition of the plaintiffs in error I

to set aside the ju~gment rendered herein on the 9th day of June,

1978, and qrant a rehearing thereof, the prayer of the said petition

is denied.

A Copy,

Teste: . -:"

. '.~ Y.~ f.""

30

.JOHN C.L.OWE

P". GUTHRIE GORDON Ill

ANNIE LEE CONGDON

CRAIG T. REDINGER

LAW OFFICES

LOWE AND GORDON L.IMITitD

409 PARK STREET

CHARL.OTTESVIL.L.E, VIRGINIA 22901

November 15, 1978

The Honorable William E. Spain Judge, Circuit Court of the City

of Richmond, Division II Tenth and Hull Streets Richmond, Virginia 23224

IN RE: Allen, et al. v. Goodstein, et al. - Case:Number A-159-L --

Dear Judge Spain:

AREA COOE 804

296·8188

This letter memorandum is being submitted pursuant to our pretrial conference with you on ~ovember 8, 1978, at your office. I have sent a copy to Mr. Smithers so that he may respond.

1. Election of Remedies Issue

The pretrial conference in your office resulted in the narrowing of the election of remedies issue down to a very narrow legal issue, as I understood the outcome ·of that meeting. The remnant issue is simply whether the contract counterclaim of the defendants/counterclaimants is barred under the doctrine of election of remedies where the final disposition of the tort claim against the same parties was a bar of the claim on the basis of the statute of limitations, rather than a judgment on the merits.

It is clear under Virginia law that the institution of a law suit, without more, does not constitute an election of remedies such as will bar another claim in seeking a different remedy. Pollard and.Bagby Co. y. Morton G. Thalheimer, Inc., 168 Va. 529, 194 S.E. 701 (1938). The doctrine of election of remedies is an equitable one, founded on estoppel. In grappling with the precise nature of this doctrine, the Virginia Supreme Court stated:

~ {' ~J$i~·f7~ ~~--,;;~~

31

The Honorable William E. Spain November 15, 1978 Page Two

But an election, to be conclusive must be efficacious to some extent at least. The mere bringing of a suit is not a determination of the right. A party against whom the estoppel is pleaded must have received some benefit under an election. Or he must have caused some detriment to the other party.

Pollard, supra, at 533, quoting Register ~· Carmichael, 169 Ala. 588, 53 So. 799. Thus, the issue is at least narrowej by that case to the question as to what constitutes benefit to the plaintiff or detriment to the defe~dant.

The Pollard case presents excellent quidance for the court in the case at bar. In Pollard the plaintiff had brought a suit in equity to obtain specific performance of an agreement between two sales agents concerning the division of a sales commission on a piece of land. In response to the defendant's demurrer that plaintiff had an adequate remedy at law, the plaintiff filed a motion for judgment on the same set of facts. When the first action resulted in a hung jury, the plaintiff renewed his efforts in the equity suit for specific performance. The defendant then claimed that the prosecution of the action at law constituted an election of remedies prohibiting further efforts in the suit in ~quity. In applying the above-mentioned benefit-detriment test, the court refused to bar the equity suit, finding

In the instant case, the plaintiff has received no benefit from the common-law trial and the defendant has lost no right although he has been put to the trouble and expense which it necessitated. Beyond this, there is nothing to indicate that Pollard and Bagby were injured by this shift in position from law to equity.

Pollard, supra.

In the case at bar, a similar situation existed, although not idential. Beyond the mere trouble and expense of the dispute as to the applicable statute of limitations, the

32

The Honorable William E. Spain November 15, 1978 Page Three

plaintiff in this case has undergone no detriment. In fact, the detriment is substantially less than that of the two-day trial and all of the discovery and preparations, which the defendant was subjected to in Pollard. As in Pollard, the defendants/counterclaimants in th~s case have rece1ved no benefit from the first proceeding in tort, which was barred by the statute of limitations. Nor, as in Pollard, did the defendants/counterclaimants have any decision on the merits of the tort claim, either for them or against them. In fact, the better argument would be that the plaintiffs in this case are estopped from complaining about election of remedies, since it was their action in pleading the statute of limitation which prevented the tort action from concluding on the merits of the claim, thus resolving the issue for all parties.

As noted above, the doctrine of election of remedies is basically equitable in nature. In the absence of harm to the plaintiff in this case, or benefit to the defendant/counterclaimants, there is no basis fo.r interposing an equitable bar against the defendants/counterclaimants which would prevent them from finally having their day in court on the merits of their claim. Indeed, in suits in equity, there are no common-law statutes of limitations, but only the doctrine of laches. In the same spirit, an equitable ba% should not be interposed. to prevent the prosecuti.on of an action in contract when a tort action has been barred by the defendant on the technical ground of the bar of a statute of limitations.

The plaintiff'·s reliance on the Standard Products v. Wooldridge case, 214 Va. 476 (1974) is unfounded. The crucial distinction is that the plaintiff in Wooldridge had a judgment on the merits in his favor in the full amount of his prayer for damages. The defendants/cross-complainants in this case have not yet had their day in court on the merits of their claim against the plaintiffs. In Wooldridge, the Supreme Court of Virginia simply upheld earlier cases to the effect that the filing of a suit does not constitute an election by itself, but that prosecuting an action to a final judjment on the merits does constitute such an election.

33

The Honorable William E. Spain November 15, 1978 Page Four

..

Counsel for the plaintiffs has conceded that the thrust of their election of remedies argument is not with regard to the recovery against Freehling & Robertson, but as to the bar of the period of limitations on th.e tort claim against the plaintiffs in the,earlier tort suit. In the Wooldridge case, there was no second action against Wooldridge on a different theory of recovery, which would be necessary in order to make that case analogous and applicable to the case at bar.

Without a final judgment on the merits, either for or against the plaintiffs, they have no equitable right to bar the· pursuit of any remedy for which still exists a valid right of action, regardless of the theory of recovery.

2. Tolling of Statute of Limitations

Mr. Smithers has outlined in his letter of September 27 to me, a copy of which was ... sent to the court, four occasions, in the abstract, which he believed could be relied upon by the court as the date of tolling of the statute of limitations. He also suggests specific dates which.apply to each of the four. While I do not necessarily believe that these are exhaustive, I would point out that under any of them, we prevail on the statute of limitations questions raised.

(a) Termination of Employment - The defendants/ counterclaimants plead facts which, if believed, show that the termination of employment did not take place until February 1975, at the earliest. If those allegations are believed by the trier of fact, on the merits, then by Mro Smithers' own contention of the law, the counterclaim was filed well within a three-year period of lLmitation. This means that under the first basis for considering tolling'· a fact issue is presented for a jury to determine upon proper instruction.

(b) Date of Alleged Negligence - .This provides another recovery on a different theory of tolling. We have pleaded obstruction by conscious and willful fraudulent concea~ent of the malpractice and of the inadequate examination of the land, and this obstruction would continue until cured by discovery of the malpractice and concealment. (~ discovery

34

The Honorable William E. Spain November 15, 1978 Page Five

of the defect in the land) or until the fraud was disclosed or disavowed by the plaintiffs in this action. Under this theory, the statute would have been tolled by the obstruction of the plaintiffs until discovery of the fraud by the defen­dants/counterclaimants at the deposition of Mr. Vogelsang in the spring of 1975. 1

{c) Discovery of the Neg~igence. The discovery of the defect in the land occurred not later than June 17, 1974. The fraud perpetuated on the date of closing, which obstructed the discovery of the malpractice and the failure properly to examine the land~ would continue, as in paragraph {b), above, and, in addition, would be tolled by the repre­sentation of the plaintiff law firm during the period June 17, 1974, through February 1975, when the employment relationship was terminated. This again would bring the action well within the three-year period of limitation because of the tolling effect of the fraudulent concealment and the representation by the plaintiffs.

(d) Damages Incurred. Essentially the same argument as sub-paragraph (b), above.

Under any of the four theories of tolling the factual allegations of the counterclaim are sufficient to withstand the plea of statute, and make it a jury issue of fact as to whether the tolling is in effect. One of the ways this could be dealt with is to have specific interroga­toraes for the jury on questions which would give the court a basis for making a ruling on the statute of limitations, as well as giving the jury the general issue of liability and damages.

3. Ter.mination of Employment

Defendants/cross-complainants disagree with the position of the plaintiffs indicating that the law is unclear in Virginia on the termination of employment of an attorney, and how it affects a statute of limitations. Defendants/ counterclaimants believe that the case of McCormick v. Romans and Gunn, 214 Va. 144 (1973) is conclusive and clear.

35

The Honorable William E. Spain November 15, 1978 Page Six

As the court said in that case:

But where there is an undertaking which requires a continqation of services, the statute of limitations does not begin to run until the termination of the undertaking. [cite] This special rule is applicable to a continuing agreement between attorney and client. [cite] Indeed it is particularly appropriate to an attorney-client agreement in view of the confidence and trust inherent in that relationship. [cite]

In this case, the McCormicks' allegations show clearly that the agreement between Mrs. McCormick and the fir.m of Romans and Gunn required a continuation of services­by the partnership from April 1963, until August 1967. The allegations further show that the agreement was terminated when the misappropriations by Romans were discovered and demand was made in October 1967 for payment of the balance claimed to be due Mrs. McCormick. The statute of limitations began to run only upon such termination in October 1967 ••••

McCormick, supra, at 148-149. This ruling is on all fours w~th the present case at bar. By the pleadings of the counter­claim, the relationship was agreed to continue after October 3, 1972, and through to the point when the defendants/counter­claimants fired the. law firm in February 1975. Therefore, regardless of whether the tolling rules suggested in para­graph 2 (b), (c), and (d), above, are appropriate, the termination of employment is an overriding tolling rule which makes clear that the counter-claim of the defendants/ counterclaimants is not barred by the three-year period of limitation in this case. At least that is true until a jury resolves any factual dispute as to whether the allegations of continued employment made by the defendants/counterclaimants are true.

36

The Honorable William E. Spain November 15, 1978 Page Seven

4. Tolling by Obstruction Through Fraudulent Concealment

The case of Hawks v. DeHart, 206 Va. 810, 146 S.E. 2d 187 (1966) clearly shows that if the allegations of the defendants/counterclaimants a~e believed by the jury, then Buffenstein fraudulently concealed and obstructed the malpractice claim of the defendants by such willful and fraud­ulent misrepresentations. That would toll the statute of limitations in Virginia until the fraudulent concealment of the malpractice is disclosed or discovered. After reciting ~hat in general in personal injury actions the limitation on the right to sue begins to run when the wrong is done and not when the plaintiff discovers that he has been damaged, the Supreme Court of Virginia in Hawks recognized that had the plaintiff's evidence sustained her allegation that the defen­dant "did knowingly, actively and negligently conceal from the plaintiff [malpractice]" it would have tolled the.running of the statute of limitations. The Court cited the case of Richmond Redevelopment & Housing Authority v. Laburnun Const. Corp., 195 Va. 827, 80 S.E. 2d 514.£or the proposition that:

• • • The character of fraud necessary to toll the statute must be of a variety involving moral turpitute. A defendant must intent to conceal the discovery of the cause of action by trick or artifice and must have thus actually concealed it from the plaintiff in order for the exception to apply.

In the Hawks case, the court found that the plain­tiff's evidence failed to establish trick or artifice or

· purpose on the part of the defendant, but left no doubt that had the evidence established such a trick or artifice or purpose, the statute of limitations would have been tolled.

There is no question under Virginia law that if the allegations of the defendants/counterclaimants concerning

·Mr. Buffenstein's fraudulent concealment are believed by the trier of fact, the statute of limitations would be tolled by this fraudulent concealment. Thus, at best, since the fraudulent concealment of malpractice by Buffenstein was not

37

The Honorable William E. Spain November 15, 1978 Page Eight

.·

discovered according to the pleadings until spring· of 1975, this presents a fact issue for the jury upon proper instruction and perhaps special interrogatory.

For the foregoing reasons, the plea in bar and the plea of the statute of limitations should be overruled. In the alternative, the court should take the plea of the statute of limitations under advisement pending a resolution of the fact issues by the jury, and should require the filing of responsive pleadings by the plaintiffs so that this case can be matured and set for trial.

JCL/lmy

crohn c. Lowe Counsel for Defendants/counter­

claimants

cc: Williams. Smithers, Jr., Esq.

38 ..

LAW OFFICES

THOMPSON, SAVAGE, SMITHERS & MARSHALL

HARRY L. THOMPSON .JULIAN E SAVAGE WILLIAM S. SMITHERS, .JR. WILLIAM R. MARSHALL, .JR.

OREGOAY 0. FOREMA.N DARRY L. PROCTOR

!5911 WEST BROAD STREET

RICHMOND, VIRGINIA 23230

December 4, 1978

The Honorable William E.Spain Judge of the Circuit Court, City of Richmond, Division II Tenth and Hull Streets Richmond, Virginia 23224

Re: Allen v. Goostein 2 et al, No. A-159-L

My dear Judge Spain:

MAILING ADDRESS P. 0. BOX 84t47

RICHMOND, VIRGINIA 23230

AREA. cooa: 804 .

TELEPHONE 288•4007

.. LEASit RI:P"ER TO IPILC NO,

In .response to Mr. Lowe's letter memorandum to you dated November 15, the Plaintiff reasserts herein the contents of its memorandum in support of the plea in bar to the Defendant's counterclaim.

Additionally, the Defendants seem content to rely on Pollard and Bagby Co.~ Morton~ Thalheimer, Inc., 169 Va. 529, 194 S.E. 701 (1938). We contend that Pollard and Bagby. is more than dtstinguishable, it is different in every way. In Pollard and Bagby, the Plaintiff filed a suit in equity andzwhile it was pending filed a Motion for Judgmen~ on the same facts apparently somewhat standard practice in those days when discovery was compellable in equity but not in law. Initially, no motion to compel election was filed and no election was made. The Plaintiff sufferred a mistrial on the action at law and then moved to revitalize the suit in.equity. At this point the Plaintiff was put to an election and elected equity. After judgment in equity in favor of the Plaintiff, the Defendant appealed asserting that the mere filing of the action at law amounted to a binding election. The Court followed a long-standing rule prevailing in other states and in Virginia with regard to equity and law and held that the mere filing of the suit on· the one side of the Court or the other did not amount to a binding election. This interpretation was given to Pollard in Jennings~. Realty Developers, Inc., 210 V~. 476 (1970), wherein the Court emphasized that only one case was prEs cuted to judgment. Without belaboring the point, the Plaintiff's contention in the case at bar is that Goodstein .and Rubin in Case No. 0108-L filed in this Court were met with a demurrer filed by Hirschler nd Fleischer, the specific purposezo~ the demurrer being to require the Plaintiffs therein to elect between misjoined causes of action as asserted in contract and tort based on exactly (Emphasis Added) the same facts to support both causes of action. This Court's Order of March 4, 1976, so put Goodstein and Rubin on terms. To permit Gbodstein and Rubin now to have another bite at the same apple, in the opinion of counsel, is inconsistent with the public policy supporting the doctrine

The Honorable William E.zSpain -2- December 4, 1978

of election of remedies and litigation on the matters asserted should be put to rest.

As to the Plaintiff's plea of the statute of limitations, the Plaintiff's find the Defendant's Memorandum to be less than meritorious. The Plaintiffs reaffirm the content~ of counsel's letter to the Court dated September 27, 1978, and briefly comment additionally as follows:

This Court's Order of November 22, 1976, in Case No. 10108-L made a finding on Page Two of the Order as follows:

The Court finds the beginning date·of the running of the statute of limitations to be August 4, 1972 as to.paragraph 4(c) as the plaintiffs partially examined the land prior thereto and had a right to repduciate the contract any ttme up to that date, and while they partially examined the bond they had an opportunity to fully examine it, which examination would have revealed the sand and gravel mining of the major portion of the land, they failed to do so. As to paragraph 4(b) of the contract and Count II of the Amended Motion for Judgment alleging fraud, the Court finds that the statute of limitations commences to run as of October 3, 1972, the closing date of the purchase under the contract.

The counterclaim of the Defendants as filed herein restates exactly the same factual circumstances as were stated in the Plaintiff's Amended Motion for Judgment ruled upon by this Court in November of 1976.

- Based upon the Court's previous ruling on exactly the same. fact~s Goodstein and Rubin cannot now place· a contra~t conception on their c se of action and reasonably ask this Court to apply a different trigger mechanism for the ruling of the statute of limitations.

This Court is fully familiar with the case of Oleyar ~Kerr, Trustee, 217 Va. 88, this case having been previously discussed with the Court by both the Plaintiffs and Defendants in argument on Case No. 10108-L. It is clear that our Supreme Court applies a three-year period of limitations in claims by the client against the attorney, the Court's theory being that but for the oral contract of employment there would exist no duty for the lawyer to perform any obligations on behalf of the client.

Hirschler and Fleischer filed suit against Goodstein and Rubin in August of 1977, some four years after this Court determined the statute of limitations began to run with respect to the cla~s as asserted by Goodstein and Rubin both in Case 10108-L and in this case as to their alleged damages for failure of the law firm to properly see to the conditions of the contract, to-wit: paragraphs 4(b) and 4(c).

40

The Honorable William E. Spain -3- December 4, 1978

The Defendants conclude their memorandum by asserting that the case of McCormick v. Romans and Gunn, 214 Va. 144 (1973) is on all fours with this case. With this proposition, the Plaintiffs disagree. Our Supreme Court applied a termination of employment rule because in · McCormick the facts were such that Romans, as attorney for Mrs. McCormick was handling the sale by Mrs. McCo~ick of a series~of lots in a subdivision. Certainly, in McCormick there was an undertaking by the attorney which required a continuation of services over a period of time necessary to dispose of numerous parcels of ground. Such i~ not the case here. The contract of employment between Hirschler and Fleischer and Goodstein and Rubin was a simple one transaction contractual undertaking whereby Hirschler and Fleischer participated in the drafting of a contract of purchase, the examination of title and the settling of that purchase by Goodstein and Rubin. As to the purchase by Goodstein and Rubin of the land nothing in the contractual relationship between the parties required any further service with respect to the undertakings of the attorneys beyond the closing date for that particular purchase.

For the reasons stated, the Plaintiffs respectfully pray that their plea in bar and the plea of the statute of limitations be sustained.

William s. Smithers, Jr,

WSS,Jr:yzw

cc: John C. Lowe, Esquire

41

•:

il V I R G I N I A: I. ,, j;

r j;

IN THE CIRCUIT COURT OF THE CITY OF RICHMOND, DIVISION II, the day of 19

li 1: EVERETTE G. ALLEN, JR. , e t al, !1 Plaintiffs II

r li ti :i i I

I

against

JOSEPHS. GOODSTEIN, et al., Defendants

ORDER

Case No. A-159-L

The Court, having fully heard oral argument on the plaintiff's

i plea of the statute of limitations and special plea in bar to the I

I . i

' I II I

j ,f

I I I i

defendant's counterclaim, and having considered the memoranda of law

filed herein by the plaintiff and the defendant, doth sustain the

plaintiff's plea of the statute .of limitations and doth sustain t~e

plaintiff's special plea in bar to the defendant's counterclaim, said

counterclaim now being hereby dismissed, to all of which the defendants,

by counsel, object and except.

It is further ORDERED that a copy of this Order be mailed to

WilliamS. Smithers, Jr., 5911 West Broad Street, Richmond, Virginia 23230

and to John C. Lowe, 409 Park Street, Charlottesville, Virgi~ia 22901.

ENTER: I I J..1-/71)1

ll ~~~~ l SeeL: .

1 # f_. n I ~~"!""~-~~:-r-4~~ ,,/.)~·-'_'~-~;::;~~....._ ___ , p.q. 1 William S. Smithers, Jr ~

Seen and Objected to:

~J~o~hn-C~.~L~o-w_e ___________________ __ , p.d.

VIRGINIA

IN THE CIRCUIT COURT FOR THE CITY ~RICHMOND, DIVISION II

EVERETTE G. ALLEN, JR., et al.,

Plaintiff

v.

JOSEPHS. GOODSTEIN, !! al.,

Defendants

TO: Mrs. Iva R. Purdy Clerk Circuit Court for the City of Richmond, Division II

lOth and HUll Streets Richmond, Virginia

CASE NO. A-159-L

Kindly take notice that the defendants appeal from

the final judgment order entered in this case dismissing their

counter-claim, entered by the court on January~~,l979 • ...

Because the order of the court was made based solely

on court documents, without the taking of evidence, no statement

of facts will be submitted, nor will any transcript be filed

with the court.

c. Lowe c sel for Defendants

owe and Gordon, Ltd. 409 Park Street Charlottesville, Virginia 22901

JOSEPH S. GOODSTEIN SHELDON RUBEN

Defendants