Idaho Allows Fee Disgorgement for Breach of Fiduciary Duty

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In a case of first impression, the Idaho Supreme Court recently held that fee disgorgement is available as a remedy against a lawyer for breach of fiduciary duty even if there are no resulting damages.

Parkinson v. Bevis, 448 P.3d 1027 (Idaho 2019), involved comparatively simple facts: A lawyer representing plaintiff Rebecca Parkinson in her divorce proceedings shared a confidential attorney-client communication with opposing counsel. In a subsequent lawsuit against the lawyer, Parkinson conceded that she was not damaged by the unauthorized disclosure—instead framing her claim as one for breach of fiduciary duty seeking fee disgorgement as a remedy. The trial court dismissed the claim, but the Idaho Supreme Court reversed.

The Idaho Supreme Court first distinguished breach of fiduciary duty from legal malpractice: “A breach of fiduciary duty claim is an equitable claim for which a defendant may have to disgorge compensation received during the time the breach occurred, even if the plaintiff cannot show actual damages.” 448 P.3d at 1033.

via Idaho Supreme Court Allows Fee Disgorgement for Breach of Fiduciary Duty — NWSidebar

A result of interest to Oregon lawyers, since a fee disgorgement claim not involving negligence is unlikely to be covered by the Professional Liability Fund.