Webb Law Group proudly takes you inside a real case that was handled by our firm. While names have been omitted for privacy purposes, we will approach the matter of a professional negligence case within the context of this real case. We will take you from the complaint to the conclusion, providing a segue from legal problem to solution, with the strong support of Webb Law Group’s team of attorneys and staff.
In this case, the plaintiff has filed a complaint for professional negligence, negligent misrepresentation, fraud and intentional deceit, constructive fraud, unjust enrichment, breach of implied covenant of good faith and fair dealing, and declaratory relief. The facts in this case are as follows:
- The defendant is a Certified Public Accountant licensed by the State of California.
- The defendant was retained by and represented the plaintiff in financial matters, specifically in preparation of the plaintiff’s 2009 amended taxes, as well as the tax returns of 2010 and 2011.
- The defendant represented himself to the plaintiff as a competent and qualified accountant, stating he had more than 35 years of professional experience, including representing several clients with the same circumstance as the plaintiff’s.
- In preparation of the plaintiff’s income tax filings and returns, brought into question by continuous audits by the Internal Revenue Service (IRS), the defendant wrongfully claimed that the plaintiff’s W-2 discrepancy for the year 2009 was because the plaintiff was forced to sell his Statutory Option Stock due to a hostile corporate reorganization and restructuring. The defendant advised the plaintiff that the income should qualify as capital gains and that the normal twelve month holding period for long term capital gains was inapplicable. The defendant then affirmed that it would make the plaintiff eligible to receive a sizable return.
- After being notified by the IRS that the defendant’s 2009 tax claim had been selected for further examination and that their 2010 and 2011 returns contained deficiencies, the defendant recommended that the plaintiff request a Due Process hearing from the Tax Advocate Office in order to expedite the matter and force the Tax Advocate Office to direct the IRS office to conclude the matter for a successful resolution. The defendant assured the plaintiff that he has prevailed for other clients with the same facts and circumstances and felt confident of a successful resolution. The defendant stated to the plaintiff that even if there were to be an adverse settlement, the plaintiff would be able to make payments on the settled amount. The plaintiff relied on the defendant’s advise and went forward with it.
- The defendant introduced the plaintiff to a tax attorney who is a personal acquaintance of the defendant. The plaintiff then, on the advice of the defendant, contracted this attorney to represent him in appealing the IRS findings.
- After almost two years of pushing back appointments and deadlines in preparation for the IRS Findings Appeal and misrepresentations by the defendant that he was actively pursuing a resolution to the matter, the defendant informed the plaintiff that the research and work done by both himself and the tax attorney on the matter did not conclude in a favorable result, and that the plaintiff will have to repay taxes for 2010 and 2011. The defendant then advised the plaintiff that he could use what he considered a worthless equity investment to apply a Net Operating Loss Carry Back, which would reduce tax amount owed by approximately $80,000-$200,000. The defendant assured the plaintiff that this is a commonly used practice. The defendant further advised the plaintiff that the interest will be abated and that the plaintiff will qualify for a “Fresh Start” program where the plaintiff can make payments over 7 years – an option the defendant continuously assured the plaintiff was still viable.
- The defendant made false representations on the status and his pursuit for the plaintiff’s tax resolutions and expected actions by the IRS. During this time, the IRS placed liens on the plaintiff’s primary residence and the residence of his ex-wife whom he has partial interest in. In preparation to pay back the IRS while waiting for the defendant’s advise, the IRS also froze the plaintiff’s E*TRADE account which was established for this sole purpose.
- In 2015, the defendant gave notice to the plaintiff that he was withdrawing his representation, and would send the plaintiff his files. After numerous requests by the plaintiff, the defendant has failed to produce all files and material related in his representation of the plaintiff.
- The defendant’s conduct was willful, intentional, and not in good faith.
- As consequence of the defendant’s wrongful action against the plaintiff, the plaintiff is at a loss of no less than $63,613.00 in damages.
Webb Law Group Resolves the Legal Matter
Webb Law Group was retained by the plaintiff in this matter and was able to resolve the legal issue without going to trial. The client was happy to accept a settlement offer of $10,000.00 to resolve this matter without further delay.
The plaintiff was happy with the resolution in this matter and their decision to retain Webb Law Group for their representation.
Finding a Professional California Business Attorney
Webb Law Group is a reputable business law firm with experience in matters involving California law, including handling professional negligence cases. Having a reputable attorney by your side for these matters will help give you the best possible chance of a positive outcome in your case. If you feel you need legal representation, we are happy to review your legal needs and provide consultation and support where necessary.
For questions, or to schedule a consultation, contact us today at 559.431.4888 (Fresno) or 619.399.7700 (San Diego).