In a 3-2 ruling, the New Jersey Supreme Court decided that attorneys can be held liable for counsel fees if they are found to have intentionally breached their fiduciary duty to non-clients. Peter Innes v. Madeline Marzano-Lesnevich, Esq.

Peter Innes and his wife, Maria Jose Carrascosa, were married in Spain in 1999, and Victoria, their only child, was born in New Jersey in 2000. Innes is a United States citizen, and Carrascosa is a Spanish national. Victoria is a dual citizen of the United States and Spain.

The couple experienced escalating marital discord. A divorce action was filed. During the subsequent contentious litigation, the parties entered into an agreement whereby Carrascosa’s attorneys would hold Victoria’s United States and Spanish passports in trust to restrict either parent from traveling with Victoria outside of the United States without the written permission of the other (the Agreement).

After the Agreement was signed, Carrascosa fired her legal counsel and retained Madeline Marzano-Lesnevich, Esq., of the law firm of Lesnevich & Marzano-Lesnevich, Attorneys at Law (LML). Thereafter, Carrascosa obtained Victoria’s United States passport from LML and used the passport to remove Victoria from the United States to Spain.

Innes filed a petition under the Hague Convention for Victoria’s return to the United States. He traveled to Spain for a hearing on the petition.  The Spanish court denied the petition and ordered Victoria to remain in Spain until age eighteen. Subsequently, Innes was also prevented from contacting his daughter by the Spanish court. As a result, Innes has been unable to contact his daughter for the past ten years.

Meanwhile, the parties’ divorce litigation continued in New Jersey. The family judge entered a judgment of divorce and granted Innes sole legal and residential custody of Victoria.  The judgment gave Carrascosa ten days to bring Victoria back to the United States. Carrascosa failed to comply with the NJ court order. As a result, she was arrested and sentenced to a fourteen-year prison term for violating the order to bring Victoria back to the United States.

In October 2007, Innes filed a complaint against the parties’ attorneys alleging that they improperly released Victoria’s United States passport to Carrascosa and intentionally interfered with the Agreement. Innes requested relief, including damages and attorneys’ fees. Before trial, the court dismissed claims against all parties except LML. In addition, the court concluded that LML owed a duty to Innes, even though LML did not represent Innes in the divorce litigation.

The jury determined that LML was negligent in releasing Victoria’s passport to Carrascosa and awarded damages to Innes and Victoria.  The trial court then granted Innes’ motion to amend the judgment to include counsel fees and costs for both Innes and Victoria, holding “ the traditional rule that warrants an award of fees in legal malpractice cases extends to the matter at bar.”

LML appealed. The Appellate Division concluded that LML intentionally violated the Agreement, and found that awarding Innes attorneys’ fees was appropriate even though no attorney-client relationship existed between Innes and LML.

The Supreme Court granted LML’s petition for certification, limited to the issue of “whether the attorney-defendants can be liable for attorneys’ fees as consequential damages to a non-client.“ The Court decided that, because they were attorneys acting in a fiduciary capacity as trustees and escrow agents for both Innes and Carrascosa, defendants could be held liable for counsel fees if they intentionally breached their fiduciary obligation to Innes by releasing Victoria’s United States passport to Carrascosa without Innes’ permission.

The Court then remanded the case to the trial court for a finding as to whether LML’s’ breach of the Agreement was intentional since the jury did not make a specific finding that LML’s  misconduct was intentional.

The case is annexed here – Peter Innes v. Madeline Marzano-Lesnevich, Esq.

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