TORTS--INDUCING BREACH OF CONTRACT--ATTORNEY-CLIENT CONTINGENT FEE CONTRACT

Plaintiff, a practicing attorney, undertook on a contingent fee basis to represent a husband and wife in separate claims for damages alleged to have been suffered by them through the negligence of the driver of a motor vehicle. The driver was insured under a policy issued by defendant. Defendant had notice of the contract. After plaintiff had started suit on the damage claim and as the case was about to be tried, defendant's adjusters, without knowledge on the plaintiff's part, allegedly induced the clients to discharge the plaintiff (and "thereby break their contingent fee contract with him") and subsequently to settle their claims with defendant.

Plaintiff instituted a tort action against defendant for maliciously inducing a breach of the contingent fee contract. The trial court granted defendant's motion to dismiss and denied plaintiff's motion to set aside the order of dismissal. On appeal, held, affirmed. In an action by an attorney against a third party for inducing the attorney's client to break a contingent fee contract, the defendant's acts in obtaining an independent settlement are privileged, and therefore not unlawful.

Krause v. Hartford Accident and Indemnity Co., 331 Mich. 19, 49 N. W. (2d) 41 (1951).