Baldasarre v. Butler

Bernice Baldasarre and Margaret Neumann (collectively, the sellers) (plaintiffs) inherited land zoned for single-family residential use. The sellers’ lawyer, William Butler (defendant) brought the sellers an offer from Paul DiFrancesco Jr., the brother of Butler’s law partner, to buy the property for $110,000 per lot with a $50,000 deposit and the right to assign the contract. DiFrancesco hired Butler to represent him and signed a conflict-of-interest letter prepared by Butler. The sellers accepted the offer, and the contract provided that the purchase was contingent on DiFrancesco’s obtaining subdivision approval within six months, with an additional 90 days allowed if DiFrancesco had been working expeditiously. Butler had the sellers sign a conflict-of-interest letter identifying the potential conflicts of interest raised by Butler’s representation of both the buyers and sellers. Butler suggested that the sellers have another attorney review the letter, but the sellers did not. DiFrancesco, again represented by Butler, entered into an agreement with Messano Construction Co., Inc. (Messano) to sell the land at $200,000 per lot. The sellers met with Butler several times to discuss DiFrancesco’s subdivision application, and Butler never mentioned the Messano contract. DiFrancesco did not receive the subdivision approval within the six months and extra 90 days, and he asked the sellers for an additional six-month extension. The sellers debated this extension with Butler and hesitated because the value of the property was rising quickly. Butler did not mention the Messano contract and remained neutral on whether to grant the extension. The sellers ultimately agreed to the extension. Finally, the sellers approached Butler after hearing a rumor that DiFrancesco had resold the property. Butler again refused to tell the sellers about the Messano contract and recommended the sellers contact DiFrancesco directly. Several months later, the sellers learned DiFrancesco had indeed sold the property. The sellers sued Butler for violating his professional responsibility to the sellers by withholding the existence of the Messano contract. The trial court held in Butler’s favor because the sellers signed the conflict-of-interest letter. The sellers appealed.