Krutzfeldt Ranch, LLC v. Pinnacle Bank

272 P.3d 635 (2012)

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Krutzfeldt Ranch, LLC v. Pinnacle Bank

Montana Supreme Court
272 P.3d 635 (2012)

  • Written by Sharon Feldman, JD

Facts

Pinnacle Bank (Pinnacle) (defendant) agreed to make a loan to William and Julie Krutzfeldt and Krutzfeldt Ranch, LLC (the Krutzfeldts) (plaintiffs). Law firm Crowley Fleck (Crowley) represented Pinnacle in connection with the loan. When Pinnacle refused to disburse funds, Don Harris sued Pinnacle on behalf of the Krutzfeldts. Harris retained Lance Hoskins to provide tax advice. Hoskins met with Harris and the client and sent an engagement letter and a bill. Neither the letter nor the bill indicated Hoskins had withdrawn from the engagement. Hoskins did not respond to a message that he would be needed after settlement discussions. Two weeks later, Harris received a form “Dear Client” letter announcing that Hoskins and his partner had joined Crowley. The letter did not state that the Krutzfeldts were no longer Hoskins’s client. Instead, it indicated that Crowley’s resources would help Hoskins better service clients’ needs. When Harris told Crowley the Krutzfeldts would not consent to or waive the conflict, Crowley said the firm had established an ethical screen to prevent Hoskins from being involved in or receiving a fee from the case. The court denied the Krutzfeldts’ motion to disqualify Crowley from representing Pinnacle. The Krutzfeldts appealed.

Rule of Law

Issue

Holding and Reasoning (Baker, J.)

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