Stanley v. Richmond

Diana Richmond (defendant) represented Linda Stanley (plaintiff) in her divorce. C. Rick Chamberlin represented Stanley’s husband. After the trial on marital-property issues, Stanley complained about Richmond’s unwillingness to challenge Chamberlin and get the marriage dissolved. Stanley did not know that Richmond had invited Chamberlin to join her in practicing law. Chamberlin initially declined but later expressed interest. Richmond informed Stanley that Richmond and Chamberlin were discussing taking offices together. In fact, the attorneys had already agreed to practice together and were organizing the firm Richmond & Chamberlin (R&C) (defendant). Richmond induced Stanley to enter into a settlement in which Stanley gave up her interest in her husband’s pension, received money without a tax-consequences allowance, and miscalculated the rent due from Stanley’s husband’s use of the family home. Stanley subsequently learned that if she had retained a $1 interest in her husband’s pension, she would have been eligible for inexpensive lifetime health insurance and a possible survivor’s annuity. Stanley sued Richmond and R&C for breach of fiduciary duty. A legal-ethics expert testified that Richmond had a conflict of interest when she informed Stanley that she was discussing taking offices with Chamberlin. The court granted Richmond and R&C’s motion for nonsuit.