Lawyer loses fee appeal against defunct Stewart & Irwin

December 10, 2015

A lawyer who claimed his former law firm and its shareholders wrongly withheld fees he was contractually owed lost his appeal of a judgment in the firm’s favor Thursday.

The Indiana Court of Appeals in a memorandum decision affirmed summary judgment in favor of eight individual lawyers who were shareholders in Stewart & Irwin P.C., which closed its doors in June 2013 after more than 90 years in Indianapolis.

E. Scott Treadway sued the shareholders and Stewart & Irwin, claiming he was due more than the $254,421 in fees he was paid as lead counsel in a South Carolina case he brought to the firm where he worked as of counsel. His suit claimed unjust enrichment, breach of contract, conversion and breach of fiduciary duty, among other things.

“Concluding we do not have jurisdiction over the partial judgment entered for Stewart & Irwin and that the trial court appropriately granted summary judgment to the Individual Defendants, we affirm,” Senior Judge Randall Shepard wrote for the panel.

Treadway, now in private practice in Carmel, failed to convince the panel that the trial court erred in declining to pierce the corporate veil to hold the shareholders liable under his of counsel agreement. The evidence supporting his argument was struck, Shepard wrote, and he relies on a statement that the shareholders referred to themselves and one another as “partners.”

“Treadway neither supplies case law that holds this to be an impropriety nor explains how this act, without more, is sufficient to pierce the corporate veil,” Shepard wrote. “This dearth of evidence in no way satisfies the considerable burden he must fulfill in order to pierce the corporate veil. The trial court did not err on this issue.”

With regard to partial summary judgment for Stewart & Irwin, Shepard wrote the COA lacked jurisdiction because the order was not certified and remains interlocutory, appealable only under Appellate Rule 14; Treadway did not seek permission for interlocutory appeal.

The court rejected the defendants’ motion for appellate attorney fees against Treadway, claiming his attempts on appeal to file documents not before the trial court constituted bad faith.

“The Individual Defendants contend that Treadway submitted materials on appeal that were not before the trial court or that were stricken from the record by the trial court, made improper factual claims, failed to serve a copy of his corrected brief upon opposing counsel, and submitted a disorganized brief,” Shepard wrote. “Pretty much true, but we conclude these deficiencies did not quite pass the sanctions threshold.”

The case is E. Scott Treadway v. Stewart & Irwin, P.C., Mary Schmid, Ronald Smith, Donald Wray, Peter Kovacs, Jeffrey Halbert, James Brauer, Glenn Bowman, and Edward Bielski (mem. dec.),  49A04-1503-CT-95.


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