
USCA1 Opinion

	




          September 27, 1995                            United States Court of Appeals                                For the First Circuit                            _____________________________          No. 95-1023                              FLANDERS & MEDEIROS, INC.,                                 Plaintiff, Appellee,                                          v.                                ELIZABETH V. BOGOSIAN,                                Defendant, Appellant.                            _____________________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF RHODE ISLAND                    [Hon. Ronald R. Lagueux, U.S. District Judge]                                             ___________________                            _____________________________                                        Before                               Torruella, Chief Judge,                                          ___________                                Stahl, Circuit Judge,                                       _____________                          and Dominguez, * District Judge.                                            ______________                            _____________________________                                     ERRATA SHEET                                     ERRATA SHEET               Please make the following correction:                    Page 2, line 5 from bottom of page:                         Delete "Woloohojian (now deceased) and Harry          Woloohojian."                         Insert "Woloohojian and Harry Woloohojian (now          deceased)."          _______________________________          *Of the District of Puerto Rico, sitting by designation.                            United States Court of Appeals                            United States Court of Appeals                                For the First Circuit                                For the First Circuit                                 ____________________        No. 95-1023                              FLANDERS & MEDEIROS, INC.,                                 Plaintiff, Appellee,                                          v.                                ELIZABETH V. BOGOSIAN,                                Defendant, Appellant.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF RHODE ISLAND                    [Hon. Ronald R. Lagueux, U.S. District Judge]                                             ___________________                                 ____________________                                        Before                                Torruella, Chief Judge,                                           ___________                                Stahl, Circuit Judge,                                       _____________                           and Dominguez,* District Judge.                                           ______________                                 ____________________            Keven A. McKenna with whom Bruce Hodge was on brief for            ________________           ___________        appellant.            Matthew F. Medeiros and Erik Lund with whom Robert Karmen,            ___________________     _________           _____________        Flanders & Medeiros Inc., Cynthia C. Smith, and Posternak, Blankstein        ________________________  ________________      _____________________        & Lund were on brief for appellee.        ______                                 ____________________                                  September 13, 1995                                 ____________________        _____________________        *Of the District of Puerto Rico, sitting by designation.                      STAHL, Circuit Judge.  This case arises from the                      STAHL, Circuit Judge.                             _____________            representation of defendant-appellant Elizabeth Bogosian            ("Bogosian") by plaintiff-appellee Flanders & Medeiros            ("F&M") in hotly contested litigation involving family real-            estate partnerships.  After Bogosian failed to endorse over            to F&M checks made payable to Bogosian by the defendant in            the underlying litigation and delivered to F&M as her            counsel, F&M sued Bogosian for breach of contract.  Bogosian            counterclaimed for malpractice and breach of the attorney-            client contract.  The district court awarded summary judgment            to F&M on all claims.  We now reverse the award of summary            judgment on F&M's breach-of-contract claim, and affirm the            district court's ruling on Bogosian's counterclaims.                                          I.                                          I.                                          __                      In  November  1989,  following  the  withdrawal  of            Bogosian's prior counsel from the underlying litigation, F&M,            a  Providence,   Rhode  Island,  law  firm,   took  over  the            representation  of Bogosian,  a  citizen of  Florida, in  the            ongoing lawsuits  stemming from  her involvement in  a family            real estate empire created by her and her two brothers, James            H.   Woloohojian  and   Harry  Woloohojian   (now  deceased).            Bogosian had few liquid assets at  the time from which to pay            her lawyers  but stood  to receive  substantial amounts  as a            result of  her lawsuits.   In  a letter sent  to Bogosian  on            November  24,  1989 (the  "November  24  letter"), and  which                                         -2-                                          2            Bogosian then signed indicating her  agreement, F&M explained            the terms of  its representation.   The firm  would obtain  a            $25,000  retainer  from  Bogosian,  to  be  deposited  in  an            interest-bearing account; it would   bill Bogosian each month            at  its lawyers' hourly rates, with each bill due and payable            within ten days after receipt; and interest would  accrue (at            a local  bank's prime  rate) on  bills outstanding for  sixty            days or more.  The letter further stated:                      We  recognize that you  may be  unable to                      pay our monthly statements  in full on an                      ongoing basis.   To the  extent that  you                                       ________________________                      are unable to pay  those bills from other                      _________________________________________                      sources,  you have  agreed to  apply your                      _________________________________________                      first  proceeds  out   of  the   E  &   J                      _________________________________________                      receivership,   the  Woloohojian   Realty                      _________________________________________                      Associates   receivership    and/or   the                      _________________________________________                      federal  court  litigation,[1                                                   ] until  all                      _________________________________________                      of our outstanding  bills, including  any                      _________________________________________                      accrued  interest,  are  paid   in  full.                      _________________________________________                      Appended to this  letter as Exhibit  A is                      an Assignment that  we would  ask you  to                      execute.   That  assignment gives  us  an                      interest in the  proceeds of those  court                      proceedings  up  to  the  amount  of  our                      bills.   It is my  understanding that you                                            ____________________            1.  The  "E &  J  receivership" and  the "Woloohojian  Realty            Associates receivership" are  state court actions  concerning            two  family real  estate  partnerships.   The "federal  court            litigation"  (or  "valuation"  litigation)  was   brought  by            Bogosian in the United States District Court for the District            of  Rhode Island  to  dissolve the  family-owned  Woloohojian            Realty   Corporation  ("WRC"),   pursuant  to   Rhode  Island            corporations  law.   See R.I.  Gen. Laws    7-1.1-90.   After                                 ___            Bogosian filed her lawsuit,  WRC exercised its option to  buy            out Bogosian's one-third share of the corporation rather than            face dissolution.  In April 1995,  the district court adopted            as its  findings  the  report  of a  special  master  valuing            Bogosian's  WRC  stock  at   $4,901,801.    See  Bogosian  v.                                                        ___  ________            Woloohojian, 882 F. Supp. 258, 261, 266 (D.R.I. 1995).               ___________                                         -3-                                          3                      have  reviewed  this  agreement with  Ted                      Pliakas[2] and have found it acceptable.            (emphasis added).  The referenced assignment (the "assignment            document") included the following language:                      1.    Assignee  has agreed  to  represent                      Assignor in said actions at  hourly rates                      set  forth in a  letter from  Assignee to                      Assignor dated November 24, 1989.                      2.   Assignor  anticipates that  she will                           ____________________________________                      receive substantial sums in  said actions                      _________________________________________                      (the  "Recoveries"),  out  of  which  she                      _________________________________________                      expects and  agrees to pay the legal fees                      _________________________________________                      and  out-of-pocket  expenses  payable  to                      _________________________________________                      Assignee.                      _________                      3.   To  the  extent  that Assignor  owes                           ____________________________________                      Assignee  any   money  for  out-of-pocket                      _________________________________________                      expenses and legal  services rendered  by                      _________________________________________                      Assignee in connection with said actions,                      _________________________________________                      Assignor  hereby   assigns  to  Assignee,                      _________________________________________                      effective as  of the  day and  year first                      _________________________________________                      above  written,  that   portion  of   the                      _________________________________________                      Recoveries which is necessary to  pay all                      _________________________________________                      of  Assignee's  then unpaid  bills.   The                      ___________________________________                      remainder  of  the  Recoveries  shall  be                      payable to Assignor.                      4.  In the event that there is a recovery                      in fewer  than all of  said actions,  and                      Assignee  is paid  in full,  and Assignor                      later incurs additional legal  expense to                      Assignee which is  not paid on a  current                      basis,  Assignee  shall   be  paid   such                      additional    legal   expense    out   of                      additional amounts, if any,  recovered by                      Assignor in the remaining actions.                      5.   Nothing  contained herein  shall  be                      construed  so as  to  limit  Assignee  to                      payment  of  its   legal  expenses   from                      amounts  recovered  by  Assignor in  said                      actions.                                            ____________________            2.  Bogosian's personal attorney.                                         -4-                                          4            (emphasis added).   Both parties  signed the  document.   F&M            filed an  appropriate financing statement with  the office of            the  Secretary of  State, asserting  F&M's rights  as secured            party to "[a]ll of Debtor's rights to the recoveries received            by Debtor arising from" Bogosian's various lawsuits.                      F&M  represented  Bogosian  pursuant to  the  above            terms in at least ten different matters between late 1989 and            the  end of 1992,  with the bulk  of its time  devoted to the            valuation litigation.   In July  1990, the district  court in            that case ordered  WRC (1)  to grant Bogosian  a $10  million            mortgage  on one of WRC's properties as security to guarantee            eventual payment  of her  shares' value  once that  value had            been determined,  and (2)  to provide Bogosian  with "interim            distribution" payments  of an  initial $100,000  plus $10,000            per  month, to continue until  the entry of  a final judgment            determining the fair value of her shares.3                      On December  23,  1992, without  -- so  far as  the            record shows -- any solicitation from either Bogosian or F&M,            WRC delivered two  checks to F&M  made payable to  Bogosian.4                                            ____________________            3.  F&M  asserted  no  claim  to  these payments,  presumably            because it had argued to the district court that the payments            were necessary  for Bogosian to meet  her day-to-day expenses            and  demands of other  creditors.  WRC  appealed the district            court's  order, and  we  affirmed.   Bogosian v.  Woloohojian                                                 ________     ___________            Realty Corp., 923 F.2d 898 (1st Cir. 1991).            ____________            4.  The voluntary payment  followed on  the heels  of a  jury            verdict in  Bogosian's favor  in a Massachusetts  state court            lawsuit  initiated by  WRC, in  which  WRC sought  damages in            excess of  $20 million  for Bogosian's alleged  usurpation of                                         -5-                                          5            The checks, one for $900,000 and the other for $100,000, were            accompanied by a letter stating the following:                           Enclosed   please   find   two   (2)                      Woloohojian  Realty Corp.  ("WRC") checks                      totalling $1 Million  Dollars payable  to                      Elizabeth   V.   Bogosian.     This   sum                      represents a  voluntary principal payment                      made by WRC on account of Mrs. Bogosian's                      former shareholder interest.  This entire                      sum shall constitute an  immediate credit                      toward  any  principal  sums   which  may                      become  due and owing to Mrs. Bogosian in                      the federal court  proceeding on  account                      of  WRC's purchase  of her  shares and/or                      WRC's liquidation.                           WRC,   James  Woloohojian   and  the                      Estate   of   Harry  Woloohojian   remain                      willing to negotiate a  global settlement                      with  Mrs. Bogosian  which covers  all of                      the  substantive  areas  detailed in  the                      offer of settlement  dated September  30,                      1992 which  I sent  to Mr. Prentiss.   If                      Mrs. Bogosian  is interested in  a global                                                         ______                      settlement,  kindly  forward her  written                      counterproposal on or before December 31,                      1992.      We   are  prepared   to   meet                      immediately  thereafter  to  negotiate  a                      final resolution.                           Kindly  acknowledge your  receipt of                      this letter and the two checks by signing                      and returning  the enclosed copy  of this                      letter. . . .                      When WRC  delivered  the checks  to F&M's  offices,            Bogosian owed the  law firm $999,957  in accrued legal  fees,            expenses and  interest.   F&M  contacted Bogosian's  attorney                                            ____________________            corporate  opportunities.   WRC had  previously held  out the            prospect of obtaining substantial damages from this and other            lawsuits -- thus offsetting the value of Bogosian's  stock in            WRC  --   in  contesting  Bogosian's   request  for   interim            distributions in the valuation litigation.                                         -6-                                          6            (Pliakas)5  and asked  that Bogosian  indorse the  two checks            over to F&M pursuant to their assignment agreement.  Bogosian            refused,  and  that  same  day faxed  to  F&M  the  following            handwritten letter:                      Please be  advised that  I do not  accept                      nor  do I authorize  the acceptance  of a                      check  from  Woloohojian Realty  Corp. or                      any affiliates as partial payment  of any                      kind for any purpose.                      I  have  been advised,  as your  firm has                      represented to Judge Boyle, by Eustace T.                      Pliakas, Esq., my primary counsel, that a                      355  division  of  the corporation  would                      have no adverse  tax consequences for  me                           __                                __                      or WRC and that  if his Honor Judge Boyle                         ___                      so  decides as to effect that result that                      it would be very favorable to me.                      As you know, WRC has purported that there                      will  be major  tax consequences  for the                      liquidation of  property in order  to pay                      for  my  shares  which  sale  Judge Boyle                      stated in the  last hearing would  "never                      happen."                      If by  some means,  at the time  of Judge                      Boyle's  final decision,  I am  forced to                      take  dollars   instead  of  mortgageable                      property,  I question whether or not such                      principal of tax effecting does not apply                      to me. [sic]                      In any event I do not wish to prematurely                      determine   Judge   Boyle   [sic]   final                      [unreadable]  decision.    I   will  only                      accept, as  I have requested  you pursue,                      similar interim relief as I have received                      in  the  past   to  meet   my  on   going                      obligations.                                            ____________________            5.  F&M  explained  that  it contacted  Pliakas  rather  than            Bogosian  directly  because  it  recognized  that  it  had  a            conflict of interest with Bogosian regarding the checks.                                         -7-                                          7                      I  will  not  in  my  present  health  or                      circumstances accept any coercive tactics                      or any actions taken which is directed to                      creating fear of retribution to myself or                      any members of my family.            WRC   eventually  dropped   its  requirement   that  Bogosian            acknowledge in  writing receipt  of the checks  (and possible            acknowledgment  that the  checks were  payments of  principal            rather than interest), but  Bogosian still refused to indorse            them.   F&M  and Pliakas  discussed over  the next  couple of            weeks whether  the parties  could share  the  money,6 but  no            agreement  was  reached.   Thus,  on  January  14, 1993,  F&M            initiated the present action  in the district court, alleging            that  Bogosian  had  breached  the  assignment  agreement  by            refusing  to indorse the checks over to F&M.  Bogosian denied            the breach, arguing that the  checks were not "proceeds" from            the  litigation  because  neither   the  court  nor  she  had            authorized such payment,  and counterclaimed, alleging  legal            malpractice  and  breach  of  contract  by  F&M.    Following            discovery,  both parties  moved  for summary  judgment.   The            district  court  ruled  that  F&M  was  entitled  to  summary            judgment on all claims, and Bogosian appealed.                                                ____________________            6.  Bogosian claims that she neither knew  of nor approved of            these negotiations,  but that  Pliakas undertook them  on his            own  because he  feared  that F&M's  abandonment of  Bogosian            could severely harm her position in the ongoing litigations.                                         -8-                                          8                                         II.                                         II.                                         ___            A.  Standard of Review            ______________________                      We  review a  grant  of summary  judgment de  novo,                                                                __  ____            reading  the  record  in  the  light  most  favorable  to the            nonmovant.  See,  e.g., Byrd  v. Ronayne, ___  F.3d ___  (1st                        ___   ____  ____     _______            Cir.  1995).    Summary   judgment  is  appropriate  if  "the            pleadings,  depositions,  answers  to   interrogatories,  and            admissions  on file,  together with  the affidavits,  if any,            show that there is no  genuine issue as to any material  fact            and  that the  moving party  is entitled to  a judgment  as a            matter of law."  Fed. R. Civ. P. 56(c).            B.  F&M's Breach-of-Contract Claim            __________________________________                      The district court granted  F&M summary judgment on            its   breach-of-contract   claim   because   the   assignment            agreement, the court  reasoned, was an "absolute  assignment"            of Bogosian's  "entire interest  in any future  proceeds from            those  litigations to F&M up to the outstanding amount of the            legal bills.  Having  so assigned the proceeds, Bogosian  had            no power to reject  them.  She was  obligated to indorse  the            checks and pay them over to F&M."   Flanders & Medeiros, Inc.                                                _________________________            v.  Bogosian, 868 F. Supp.  412, 421 (D.R.I.  1994).  Whether                ________            Bogosian  had a good faith basis for refusing the checks, the            court held, is "irrelevant."  Id.                                          ___                      The  district  court's  analysis contains  a  fatal            flaw:    It  assumes  that,  because  Bogosian  assigned  her                                         -9-                                          9            interest in future  litigation proceeds up  to the amount  of            any  outstanding legal bills, she  also gave up  her right to            reject  any  offer  of  partial  payment.    But  the  latter            proposition does  not necessarily  follow from the  former; a            litigant may (and often  does) assign expected proceeds while            retaining  the right to accept or reject any offer of payment            or settlement.  None of the cases cited by the district court                            ____            in support of its construction of the assignment agreement --            and subsequently adopted by F&M as authority for its position            in  its appellate brief -- stands for the proposition that an            assignment   of  expected  litigation   proceeds  deprives  a            litigant  of his  or  her  right  to  control  the  terms  of            settlement.    For  example,  the court  cited  Berkowitz  v.                                                            _________            Haigood,  606 A.2d 1157, 1160 (N.J. Super. Ct. Law Div. 1992)            _______            (holding that assigned  proceeds in attorney's trust  account            belong to  client's  assignee  and client  has  no  right  to            receive  them), for  the  proposition that  Bogosian,  having            assigned the proceeds, had  no power to reject the  proffered            checks.  But the funds the assignee was claiming in Berkowitz                                                                _________            were part of  a settlement  to which Haigood  had agreed  and                                        ____________________________            which  had  already  been  paid  into  his  attorney's  trust            account.  Id. at 1159-60.   The court's reliance on Herzog v.                      ___                                       ______            Irace,  594 A.2d  1106  (Me. 1991),  is similarly  misplaced.            _____            That decision's  holding that a  "client is  not entitled  to            receive  funds once he has  assigned them to  a third party,"                                         -10-                                          10            id.  at 1109, is predicated on the client's acceptance of the            ___                                ________ __________            settlement offer from which the funds in question derive, id.                                                                      ___            at  1108.   In  neither  of  these  cases  did  the  assignee            challenge  the assignor-litigant's  rejection of an  offer of            settlement or partial payment.                      Nothing  in the  assignment  agreement purports  to            transfer  Bogosian's fundamental  right  to  control her  own            litigation and  accept or reject a  settlement offer, whether            in whole or in part.  See R.I.  Rules of Professional Conduct                                  ___            Rule 1.2(a) ("A  lawyer shall  abide by  a client's  decision            whether  to accept  an offer  of  settlement of  a matter.").            Whether a  contract that abrogated this  axiomatic duty would            even be upheld under Rhode  Island law is a question  we need            not  reach,   for  the  assignment  contains   no  indication            whatsoever  that  the  parties  intended   such  a  contract.            Without  a   clear  expression   of  intent  to   abrogate  a            fundamental  rule  of  the  attorney-client  relationship, we            would be loath to find such intent.  Thus, the assignment  of            "recoveries"  or "proceeds"  by  Bogosian  to  her  attorneys            presumes  her  prior  acceptance   of  a  proffered  payment.            ________       _____            Otherwise, the  proffered payment  remains nothing  more than            just  that; until  it  has been  accepted  by the  client  or            ordered by  the court, it constitutes  neither "proceeds" nor            "recoveries"  but  only  an   offer  of  payment  or  partial            settlement.                                         -11-                                          11                      Nor   does  F&M  seriously  dispute  that  Bogosian            retained  the right to accept or reject any settlement offer.            In  fact,  F&M concedes  in  its  brief that  the  assignment            agreement operated  as a  security  agreement, with  Bogosian            retaining control over  her cause  of action, and  not as  an            absolute assignment of litigation rights:                      The agreement did  not assign  Bogosian's                      causes  of action  to F&M (F&M  could not                      have sued WRC on those causes of action),                      but only assigned the first proceeds from                      the  litigation; it did  not give  F&M an                      interest  in  the  litigation beyond  the                      amount  of its  earned  fees  and  costs.                      Moreover,   the    assignment   was   not                      absolute: it would have  been ineffective                      if Bogosian had simply paid her bills.7            Brief  of  Plaintiff-Appellee  at  20.8    These  concessions            _____________________________                                            ____________________            7.  A few  pages further along  in its brief,  F&M apparently            decided  that  it  had   better  argue  that  the  assignment            agreement was in fact an absolute  assignment.  Responding to            Bogosian's attempt  to distinguish In  re Apex  Oil Co.,  975                                               ____________________            F.2d 1365 (8th Cir.  1992) -- which the district  court cited            for the  proposition that an assignment  transfers all rights            in the assigned property -- on the ground that the assignment            in  that  case  was  absolute rather  than  conditional,  F&M            informed  this  Court  that  "the  assignment  here  was  not            conditioned upon  anything."  Brief of  Plaintiff-Appellee at                                          ____________________________            28 n.13.  We find F&M's first interpretation more convincing.            8.  F&M  also cited  numerous cases  as  upholding agreements            "such  as  the  one  between  F&M  and  Bogosian,"  Brief  of                                                                _________            Plaintiff-Appellee  at   20,  all  of  which   construed  the            __________________            ___            agreements  as security  for  an attorney's  unpaid fees  and            expenses  rather than  as absolute  assignments of  proceeds.            E.g.,  Skarecky & Horenstein, P.A.  v. 3605 N.  36th St. Co.,            ____   ___________________________     _____________________            825 P.2d 949, 952 (Ariz. App. 1991); In re Conduct of Taylor,                                                 _______________________            878 P.2d 1103, 1110  (Or. 1994); Burk v. Burzynski,  672 P.2d                                             ____    _________            419,  423  (Wyo.  1983).    Although   the  language  of  the            agreements in  some of  these cases more  clearly established            that  they were  intended to  operate as  security agreements            than  the assignment  agreement  here, both  the November  24                                         -12-                                          12            notwithstanding, F&M argues that  Bogosian still had no right            to reject WRC's  $1 million voluntary payment because  it was            not an offer  of settlement.  At least after  WRC dropped the            requirement that  Bogosian stipulate that the  money would be            applied  to  principal  and  not interest,  F&M  argues,  WRC            imposed no conditions on  Bogosian's acceptance of the money.            Therefore, so this argument goes, Bogosian could not have had            any valid reason for rejecting the checks.                      This  argument  also  misses  the  mark,   for  the            proffered payment did in  fact contain an implicit condition:            namely, that  the $1  million portion of  Bogosian's ultimate            award represented by the two checks would be paid in cash and            not property.   Bogosian, in accepting  the checks, would  be            forgoing  her right to attempt in the future to structure the            payment  of that  portion  of her  award  in an  advantageous            manner.  Thus, while WRC's offer of payment may not have been            a  partial  "settlement  offer"   in  the  usual  sense,  its            acceptance nevertheless could  have limited Bogosian's future            options, and she  may well  have had  legitimate reasons  for            refusal.                                            ____________________            letter  and   the   assignment  document   limit   Bogosian's            assignment of proceeds  to the extent  that Bogosian has  not            paid F&M's  bills.   Thus, F&M  would have  no rights to  any            proceeds unless and only to the extent that Bogosian fails to            pay her attorney's bills.  This is an assignment for purposes            of security.  See In  re Apex Oil, 975 F.2d at 1369  ("We see                          ___ _______________            no meaningful  difference between a security  interest and an            assignment for purposes of security.").                                         -13-                                          13                      Moreover, there is evidence that the possibility of            Bogosian  ultimately receiving property  rather than  cash in            exchange  for  her  shares  is no  pipedream.    The  statute            governing  the valuation  litigation provides that,  once the            value of  Bogosian's shares have been  determined, "the court            shall set forth in its order . . . the purchase price and the            time within which the  payment shall be made, and  may decree                                                          _______________            such other terms and  conditions of sale as it  determines to            _____________________________________________________________            be  appropriate . .  . ."  R.I.  Gen. L. 7-1.1-90.1 (emphasis            _______________            added).  The  district court in  the valuation case  recently            stated:                      What   [Bogosian's]   judgment  will   be                      remains to be seen.   It may be that  the                                            ___________________                      court  will  order  satisfaction  of  the                      _________________________________________                      purchase   price   by  the   transfer  of                      _________________________________________                      particular  parcels  of  real estate,  at                      ____________________________________                      least  in part, a result contended for by                      Plaintiff.      What   is  clear   beyond                      peradventure is that it is for this Court                      to  determine, under the precise terms of                      the statute, the "terms and conditions of                      sale   as  it   determines  appropriate."                      Until  this Court has had the opportunity                      to do  so,  Plaintiff  does  not  have  a                      definable   interest   in  any   specific                      property.    There  is  no  judgment  for                      Plaintiff which may be levied upon.            Bogosian v. Woloohojian,  C.A. No. 88-0373B, slip. op. at 7-8            ________    ___________            (D.R.I. Aug. 4, 1995) (emphasis added).                      Nevertheless, F&M  argues that, even  assuming that            Bogosian eventually could receive property instead of cash as                                _____            payment for her shares,  she could not have had  a good-faith            reason  for  rejecting  the  checks because:  (1)  she  would                                         -14-                                          14            eventually  have to  pay  the law  firm  in cash,  so even  a            disposition  of property  by the  court would  necessitate an            eventual sale of  assets, and (2) any payments made  to F & M            would be tax-deductible, so a cash payment from WRC would not            have  any  adverse  tax   consequences.    This  argument  is            similarly unpersuasive: Bogosian  could conceivably  mortgage            any  property she receives and  pay F&M from  those funds, or            perhaps F&M would even acquire  an interest in the  property.            And even if a  cash payout would be tax-deductible,  Bogosian            might prefer  a disposition of  property for  non-tax-related            reasons,  e.g., because  she believes  the property  is worth            more  than  its  court-assigned  valuation,  or  because  she            believes its  appreciation rate  and income stream  will more            than compensate  for interest costs she  incurs in mortgaging            it to  pay off F&M.   In any event, Bogosian  asserted in her            faxed response to F&M, on the same day that F&M requested her                                   _______________            indorsement of  the checks, that she did not want to do so in            part  to avoid  foreclosing the  possibility of  the district            court awarding her "mortgageable property" instead of cash.                      If  Bogosian did not  in fact reject  the checks in            good faith,9 but rather simply because she wanted the cash in                                            ____________________            9.  F&M  is correct, of course, in stating that good faith is            not a defense to a breach-of-contract claim.  See Restatement                                                          ___ ___________            (Second) of Contracts   11, introductory note (1979).   We do            _____________________            not  hold that a  good-faith belief that she  did not have to            assign the checks to F&M would absolve Bogosian of liability;            rather,  we hold that if Bogosian rejected the checks in good                                              ________            faith  -- i.e., for some legitimate reason not connected to a                                         -15-                                          15            her hands rather  than in  F&M's coffers, then  she may  well            have  breached the  covenant of  good  faith implicit  in all            contracts under Rhode Island  law.  See Crellin Technologies,                                                ___ _____________________            Inc. v. Equipmentlease Corp.,  18 F.3d 1, 10 (1st  Cir. 1994)            ____    ____________________            ("Rhode  Island  recognizes  that  virtually  every  contract            contains  an implied covenant of good  faith and fair dealing            between the parties."); Ide Farm & Stable, Inc. v. Cardi, 297                                    _______________________    _____            A.2d  643, 645 (R.I.  1972) (stating that  purpose of implied            covenant  of   good  faith  and  fair  dealing  is  "so  that            contractual objectives may be  achieved").  We find, however,            that a  rational jury, presented with  the evidence contained            in the summary judgment  record, could conclude that Bogosian            rejected the  checks for  a legitimate reason,  and therefore            summaryjudgment                          onF&M'sbreach-of-contractclaim                                                       isinappropriate.10                                            ____________________            desire  to keep the money  herself and avoid  the dictates of            the assignment  agreement --  then she has  not breached  the            contract.            10.  A  rational jury  might also  conclude, of  course, that            Bogosian only had an  aversion to receiving cash when  it was            going  into F&M's pocket,  as counsel for F&M  put it at oral            argument.  The fact  that Pliakas tried to negotiate  a share            of the $1  million for Bogosian,  and Bogosian's argument  to            the  district court that F&M should not have asserted a claim            to  the money when  it knew that  she needed the  cash to pay            other creditors, support this view.  Divining Bogosian's true            intent requires an assessment of  her credibility, a task for            the factfinder, not the court.                      We have also considered, and found meritless, F&M's            assertion that  comments by Bogosian's attorney  in a related            interpleader  action estops  her  from arguing  now that  the            proffered $1 million were  not "proceeds."  In the  course of            arguing  against  the  interpleading  of  WRC's  $1  million,            Bogosian's  attorney  told  the  court that  the  funds  were            "proceeds" of the valuation  litigation and their disposition                                         -16-                                          16                      Although  we  remand  for  trial on  the  issue  of            liability,  we leave intact that part of the district court's            summary judgment ruling establishing the amount Bogosian owed            F&M  as  of  the  date  of  alleged  breach,  plus  interest.            Bogosian argues that this  would be inappropriate because F&M            never  specifically  asked  for  "partial  summary  judgment"            pursuant to  Fed. R.  Civ.  P. 56(d).   We  know  of no  such            requirement; Rule 56(d) states that a court,  "[i]f on motion                                                           ______________            under this rule (Rule  56) judgment is not rendered  upon the            _______________            __________________________________            whole case[,] . . . shall if practicable" specify those facts            __________          ____________________            that  are without  substantial controversy.   F&M's pleadings            and  affidavits made  clear that  it was  asserting that  the            legal fees  and expenses  detailed in its  billing statements            were  fair  and  reasonable  in  light  of  the  services  it            performed  for  Bogosian.    Bogosian   never  contested  the            accuracy or truthfulness  of any of those statements, nor did            she adduce any expert testimony that the  requested fees were            excessive.   Bogosian offered her  own opinion that  the fees            charged  for   certain  portions   of  the  litigation   were                                            ____________________            should  be determined in that  action.  We  do not understand            his  comments to amount to an assertion of rights by Bogosian            to  the money,  and we  therefore hold  that Bogosian  is not            estopped  from  arguing  that  the  funds  were  not in  fact            "proceeds" or "recoveries."                                         -17-                                          17            excessive,11 but her  generalized assertions  are not  enough            to create a "substantial controversy" about the amount she is            obligated to pay  under her contract with  F&M, assuming that            she is found  to have breached  that contract.   See Fed.  R.                                                             ___            Civ.  P. 56(e) ("When a  motion for summary  judgment is made            and  supported as provided in this rule, an adverse party may            not  rest upon the mere allegations or denials of the adverse            party's  pleading,  but  the  adverse  party's  response,  by            affidavits or  as otherwise provided  in this rule,  must set            forth specific facts  showing that there  is a genuine  issue            for  trial."); see  also  Bennett v.  Martin-Trigona, 686  F.                           ___  ____  _______     ______________            Supp.  6,  9  (D.D.C.  1988) (awarding  summary  judgment  to            plaintiff-attorney after defendant-client  failed to  provide            evidence of specific errors in  bills); cf. Pfeifer v. Sentry                                                    ___ _______    ______            Ins.,  745 F. Supp. 1434, 1443 (E.D. Wis. 1990) (stating that            ____            when  amount  of attorney  fee  is  challenged, attorney  has            burden of  proving reasonableness of fee,  but opposing party            has responsibility to state objections with particularity and            clarity).                      This  is not a  fee-award case, where  the court is            called on  to determine  a reasonable  attorney's fee  in the                                            ____________________            11.  For example, Bogosian asserted  that she was billed more            than   $200,000  for   work   concerning   her   "Section   8            partnerships" yet no lawsuit was ever  filed.  Bogosian never            bothered to direct us (or the district court) to the specific            billing  entries that  she  claims represent  this work,  let            alone those entries that she deems excessive.                                         -18-                                          18            first  instance;  it  is  a  contract  case,  and  Bogosian's            obligations to F&M are defined by that contract.  See Laverty                                                              ___ _______            v.  Pearlman,  654  A.2d  696, 703  (R.I.  1995)  ("[W]hat  a                ________            plaintiff may be bound to pay and what an attorney is free to            collect under a fee agreement are not necessarily measured by            the  'reasonable attorney's  fee' that  a defendant  must pay            pursuant to a court order." (quoting Venegas v. Mitchell, 495                                                 _______    ________            U.S. 82,  90 (1990)); see also A Sealed Case, 890 F.2d 15, 17                                  ___ ____ _____________            (7th Cir.  1989) ("Fees are  matters of contract,  and unless            the  fee  is  so   exorbitant  that  its  collection  offends            [professional   conduct  rules],  disputes   about  that  are            resolved under  that body of  law.").  A  $1 million  fee for            extensive  work  performed  in a  number  of  bitterly-fought            lawsuits  is not  on its  face exorbitant,  and Bogosian  has            utterly failed  to provide evidence  that any of  the claimed            fees   and  expenses   were   in  fact   not  incurred,   are            unreasonable, or exorbitant.  Thus, the amount owed to F&M on            its   breach-of-contract   claim   is  not   in   substantial            controversy and is deemed established upon remand.12            C.  Bogosian's Counterclaims            ____________________________                      Bogosian's  counterclaim,  by the  district court's            count,   alleged  thirty-four  instances  of  malpractice  or            breach-of-contract  by F&M.    Flanders &  Medeiros, Inc.  v.                                           __________________________                                            ____________________            12.  Subject,  of  course,  to appropriate  recalculation  of            interest and  fees incurred under the  contract subsequent to            the district court's summary judgment order.                                         -19-                                          19            Bogosian,  868  F. Supp.  at 417  n.4  (D.R.I. 1994).13   The            ________            district  court granted  F&M summary  judgment on  each claim            because Bogosian had failed  to adduce competent evidence, in            the form of  expert testimony,  on the standard  of care  and            scope of  duty to  which F&M should  be held, or  on damages.            Id.   Bogosian  now  argues  that the  district  court  erred            ___            because (1)  merely identifying  an expert witness  who would                                ___________                                            ____________________            13.  The   district   court's    characterization   of    the            allegations, with which we largely agree, was as follows:                      (a)  F&M's  failure to  obtain sufficient                      interim relief in the WRC litigation; (b)                      F&M's   failure  to   properly  supervise                      expert  witness  Eric  Berenson   in  the                      appraisal  proceeding before  the Special                      Master;  (c) F&M's  failure to  insist on                      certified  income and  expense statements                      from WRC in the valuation proceeding; (d)                      F&M's  failure to  object to  the Special                      Master's  report on  the basis  of, inter                      alia,   the    appropriateness   of   the                      comparables  relied  upon by  the Special                      Master to  arrive at the value of certain                      real  estate,  his  valuation   of  WRC's                      management business based upon two years'                      management  contracts,  and the  issue of                      whether there  was a waterway  on another                      site;   (e)   F&M's  withdrawal   of  its                      representation  of  Bogosian  in the  WRC                      litigation, and its failure to bring suit                      to   enjoin   Bogosian's   brother   from                      entering  into  unauthorized   management                      contracts; (f) F&M's numerous failures to                      take  action  in  relation  to   the  two                      receiverships; and (g)  F&M's failure  to                      take  action  to have  Bogosian's brother                      declared incapacitated  and terminated as                      a   general  partner  of  the  Section  8                      limited partnerships.            886 F. Supp. at 417 n.4.                                         -20-                                          20            testify  in support  of her  claims was  enough to  survive a            summary  judgment motion,14  and  (2) certain  of her  claims            did not require expert testimony.                      Bogosian's first  argument is  plainly  wrong.   We            stated  in Focus Inv. Assocs. v. American Title Ins. Co., 992                       __________________    _______________________            F.2d 1231, 1239 (1st Cir. 1993), that under Rhode Island law,            "a legal malpractice plaintiff  must present expert testimony            establishing  the  appropriate standard  of  care  unless the            attorney's  lack of  care and  skill is  so obvious  that the            trier of  fact can resolve  the issue as  a matter of  common            knowledge."  We further explained that claims that "fall into            the  'common   knowledge'  category   are  those  where   the            negligence is  'clear and palpable,' or where  no analysis of            legal  expertise  is  involved."    Id.    Virtually  all  of                                                ___            Bogosian's claims require  analysis of  legal expertise,  and            therefore the  mere identification  of an expert  expected to                                ______________            testify  at trial would in no way demonstrate the standard of            care applicable to F&M, an essential element of her case.                                            ____________________            14.  Bogosian   filed  a   supplemental  response   to  F&M's            interrogatories  identifying an  expert  witness prepared  to            testify on  her  behalf on  February  15, 1994,  almost  five            months after  the September 24, 1993,  discovery closure date            and only  a week  before the  summary  judgment motions  were            argued before  a magistrate-judge.  The supplemental response            contained  no  indication  of  the  nature or  basis  of  the            expert's  expected testimony other than to  say that he would            testify    "in   support   of"    Bogosian's   defenses   and            counterclaims.                                         -21-                                          21                      Summary  judgment is  "mandate[d] .  . .  against a            party who fails to make a showing sufficient to establish the            existence of an  element essential to that  party's case, and            on which that party will bear the burden of proof  at trial."            Celotex  Corp. v.  Catrett, 477  U.S. 317,  322 (1986).   The            ______________     _______            moving  party  discharges  his   or  her  initial  burden  of            "showing"  the  absence of  a  genuine  issue concerning  any            material  fact by pointing  out to  the district  court "that            there is  an absence  of evidence  to  support the  nonmoving            party's  case."  Id. at  325.  F&M  discharged this burden by                             ___            pointing in its summary judgment motion to Bogosian's absence            of  expert  testimony  in  support  of  her  counterclaims.15            Therefore, summary judgment was appropriate as to all of  her            claims that required the analysis of legal expertise.16                                            ____________________            15.  Bogosian argues that F&M  only complained of her failure            to  identify an  expert witness,  and thus  she was  under no                ________            obligation  to do  any  more than  that.   F&M's  motion  for            summary judgment, however, clearly states that Bogosian "must            present  expert  testimony"  and  that  she  "has  no  expert            testimony to support this claim."  Stating that Bogosian  had            not  yet  even  identified an  expert  witness  was  simply a            stronger way  of stating that she had  no hope of bearing her            burden of proof at trial.            16.  Bogosian also argues that  the district court abused its            discretion  in denying her request,  pursuant to Fed. R. Civ.            P. 56(f), for more time to produce expert witness affidavits.            She  bases this argument  on the notion  that the requirement            that she adduce expert  testimony to survive summary judgment            was  a "new rule" dreamed  up by the  magistrate-judge at the            summary  judgment hearing,  and that  its application  to her            case constitutes an  abuse of discretion.   This argument  is            legal  poppycock;  the  requirement of  expert  testimony  in            proving most types  of malpractice claims has been  so widely            adopted  that "it may even be malpractice to litigate a legal                                         -22-                                          22                      Bogosian  also argues  that not  all of  her claims            were of  the  type  that  required  expert  testimony.    For            example, she argues that the district court failed to realize            that  her allegation that F&M breached its duty of loyalty to            Bogosian  when it  placed its  own interest  in getting  paid            ahead of Bogosian's possible interest in receiving a property            distribution rather than cash, adequately limned a breach-of-            fiduciary  duty  claim.    Similarly,  she  argues  that  her            allegation  that  F&M  withdrew  from  ongoing litigation  in            violation of their contract states a breach-of-contract claim            (assuming  that  the contract  contains  an  implied term  to            continue   representation  until   the   conclusion  of   the            litigation) that  is completely  distinct from F&M's  duty to            perform to the  appropriate standard of care.   These claims,            Bogosian  argues,   as  well  as  a   smattering  of  similar            allegations contained in her counterclaim, require  no expert            testimony because they do not  require the analysis of  legal            expertise.                      We  need not  answer the  question  Bogosian poses,            because even  assuming arguendo that Bogosian  has adequately                                   ________            stated claims that  do not require expert  testimony, she has                                   ___            failed to  introduce adequate evidence of  damages to support            any  of her  claims.   See 1  Ronald E.  Mallen &  Jeffrey M.            ___                    ___                                            ____________________            malpractice case without expert  testimony."  Wilburn Brewer,            Jr., Expert Witness Testimony  in Legal Malpractice Cases, 47                 ____________________________________________________            S.C. L. Rev. 727, 733 (1994).                                          -23-                                          23            Smith, Legal Malpractice    16.1 (1989) ("Since the objective                   _________________            of  a  legal malpractice  suit  is  usually  the recovery  of            monetary compensation  for an  injury, pleading and  proof of            damages  are essential to a cause of action."); cf. Moores v.                                                            ___ ______            Greenberg,  834 F.2d  1105, 1111  (1st Cir.  1987) ("Whatever            _________            form a legal malpractice action takes, the plaintiff  has the            burden  of  introducing  evidence  to  justify  an  award  of            consequential  damages.").    In  her  Counterclaim, Bogosian            raised the  specter of having  to hire additional  lawyers to            duplicate work  already performed by  her abandoning lawyers,            yet  she never provides further  evidence of such  costs.  In            answering  F&M's  interrogatories  regarding the  nature  and            scope  of  her  damages,  Bogosian  repeatedly  answered  (or            incorporated by reference) that  "[a]n expert will assess the            value of  damages sustained from Flanders  & Medeiros' breach            upon obtaining  further discovery."   Such an  assessment was            never  forthcoming.  As for F&M's placing its own interest in            getting   paid  ahead  of  Bogosian's  possible  interest  in            obtaining a property distribution for the  full amount of her            stock's  value, the $1 million was never received by F&M, and            the  record  contains no  evidence  that  the possibility  of            Bogosian receiving a  distribution entirely  in property  has            been diminished  at all.17   Thus,  Bogosian had  not adduced                                            ____________________            17.  The   checks  eventually   expired;  WRC   initiated  an            interpleader action  in the  district court to  determine the            rights of  various creditors  of Bogosian, including  F&M, to                                         -24-                                          24            competent evidence sufficient  to prove an essential  element            of her claim, namely,  that these alleged breaches by  F&M --            whether or not proof thereof would require expert testimony -            - have in fact damaged her.  Therefore, summary judgment must            be granted for F&M on these claims.                                         III.                                         III.                                         ____                      For  the foregoing  reasons,  the  decision of  the            district  court is reversed  in part,  affirmed in  part, and                               __________________________________________            remanded  for   further  proceedings  consistent   with  this            _____________________________________________________________            opinion.            _______                                            ____________________            funds WRC expected to pay to her.                                         -25-                                          25
