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In the latest development in what appears to be the lawyers’ equivalent of a messy divorce, a Superior Court panel has upheld a trial court’s sanction of $3,500 in costs and legal fees against attorney Marvin Lundy for using dilatory tactics over the course of the dissolution of his partnership with Donald Manchel.

The panel further ordered Lundy to pay Manchel’s fees in Lundy’s failed appeal of that sanction.

Lundy had appealed the sanction as well as a Philadelphia trial court’s confirmation of a February 2003 arbitration award in favor of Manchel as part of the dissolution.

In Re: Manchel Lundy & Lessin, the three-judge panel upheld the arbitration award, finding that Lundy had failed to file a timely petition to challenge the award, which effectively ordered Lundy to pay Manchel approximately $138,000 from their old firm’s fees assets. The two had been partners for 37 years.

“In the case at bar,” the panel states in a non-precedential memorandum opinion filed late last week, “the record demonstrates that [Lundy] has repeatedly and unabashedly ignored court orders and needlessly prolonged the dissolution proceedings at [Manchel's] expense. Moreover, the arguments presented in the instant appeal are patently frivolous, as this court finds no merit to [Lundy's] contention that he has been deprived of due process of law.”

The panel consisted of Judges Mary Jane Bowes and Seamus P. McCaffery and Senior Judge Zoran Popovich.

According to the opinion, Lundy and Manchel decided to dissolve their partnership in July 1997 and agreed to enter into binding common law arbitration for resolving all issues related to the dissolution.

In February 2003, the arbitrator, former Philadelphia Common Pleas Judge Leon Katz, entered the award in Manchel’s favor after four years of arbitration and just under two years of common pleas litigation concerning the validity of Katz’s orders.

By April 2003, according to a November 2003 opinion in the case filed by Philadelphia Common Pleas Judge Esther R. Sylvester, Katz had withdrawn from the arbitration.

In her November opinion, Sylvester ruled that Manchel was entitled to the $3,500 in fees.

According to the Superior Court opinion, a petition from Manchel requesting that the trial court confirm Katz’s February 2003 arbitration award was granted in late July 2003.

In his appeal to the Superior Court, Lundy challenged the validity of Katz’s arbitration award and asserted that the trial court had abused its discretion in awarding Manchel fees “as a sanction for dilatory tactics,” the opinion states.

The panel agreed with Manchel’s position that Lundy had not followed the proper procedure in contesting the award.

According to the opinion, Pennsylvania courts have interpreted the relevant statutes as requiring that any challenge to a common law arbitration award made in a common pleas court must come in the form of a petition to vacate or modify filed within 30 days of the date of the award.

Lundy did not file a petition to vacate or modify the February 2003 arbitration award, the opinion notes. Instead, it says, he waited to lodge preliminary objections to Manchel’s May 2003 petition to confirm Katz’s award.

The panel found that the Superior Court has “condemned this practice” in at least two decisions from recent years.

The judges concluded that “[Lundy], who is an attorney, has had numerous opportunities to raise the issues he now seeks to address, including the opportunity to file a motion to vacate or modify the February 26, 2003, arbitration award, which was never done.”

The panel found the trial court’s awarding of attorney fees proper, and also remanded the case to the trial court to determine damages to be given to Manchel for fees resulting from the appeal.

“Based on our determination that this appeal is frivolous,” the opinion states in a footnote, “we grant [Manchel's] request for reasonable attorneys’ fees related to this appeal.”

Manchel has mainly acted pro se throughout the case, but he has also been represented by attorneys from Eckell Sparks Levy Auerbach Monte Rainer & Sloane in Media.

In an interview with The Legal, Manchel said that he would argue for roughly $10,000 in fees and costs for this most recent Superior Court appeal. He also said he is planning to file for about $80,000 in fees he claimed he has incurred since the matter began.

Manchel said that he has yet to receive the $3,500 in fees he has already been awarded.

Lundy’s attorney, Paul Rosen of Spector Gadon & Rosen in Philadelphia, said that he had anticipated a decision against his client.

“The court was addressing the procedural defect,” Rosen said, “and I’m not surprised, given the questions at the [oral] arguments, that they affirmed on procedural grounds without reaching the merits.” Bruce Thall of Spector Gadon handled oral arguments on behalf of Lundy.

Lundy will not appeal the panel’s ruling, Rosen said.

Both Manchel and Rosen said that a decision on a second Lundy appeal to the Superior Court — this one concerning the arbitrator’s handling of the dissolution — is pending.

In the meantime, according to Manchel, Harris Bock of the Dispute Resolution Institute has stepped in as arbitrator in the matter by order of Philadelphia Common Pleas Civil Division Supervising Judge William Manfredi.

(Copies of the five-page opinion in Re: Manchel Lundy & Lessin, PICS No. 04-0694, are available from The Legal Intelligencer. Please refer to the order form on Page 7.)

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