Posted Nov 15, 2010 01:11 pm CST
A Nevada bankruptcy judge has sanctioned a lawyer $110,000 in legal fees for being too trusting.
A lawyer for one of the owners of the Blue Pine Group told lawyer David Winterton that all of the corporate directors had passed a resolution authorizing a bankruptcy filing. Winterton believed the lawyer—and that was his mistake, according to U.S. Bankruptcy Judge Bruce Markell in his opinion. The Las Vegas Review-Journal has the story.
Blue Pine was owned by two separate companies, and only one of them had agreed with the bankruptcy filing, the story says. Winterton filed the bankruptcy petition even though he was warned that one of the companies objected. Instead, he believed the lawyer who told him that the objecting company no longer held shares in Blue Pine, according to the opinion.
Quoting an earlier opinion, Markell said lawyers should not succumb to a “butler-style” of legal representation where the “sequaciously servile lawyer does whatever the client wants and then cites that client’s command as a shield to the improper actions.”
“Lawyers are not given the privilege of assuming that their clients or other lawyers are unfailingly truthful,” he wrote.
The sanction will pay the legal fees of the corporate co-owner that objected to the bankruptcy.