Fiduciary Duty Of Disclosure: Pretty Soon They’ll Be Talking About Real Money.

A male lawyer and a female married in 1985. In 2000, he entered into an “of counsel” relationship with a law firm specializing in securities litigation which entitled him to a referral fee of 10 percent in a class action. In 2003, the couple separated and the two entered into a marital settlement [MSA] agreement in 2007. At that time, the wife knew of the referral fee arrangement in that there had already been a recovery of approximately $7.2 billion in settlement funds, and that the firm would be submitting a request for attorney fees in federal district court. As part of the MSA, the wife agreed to accept 10 percent of the fee in exchange for approximately $7 million in other assets and debt relief, and judgment in the dissolution was entered in late 2007. In September 2008, the district court awarded $688 million in fees, and in 2009 the wife “learned she was entitled to an additional $1.560 million.” She retained a new lawyer and in November 2009 filed a motion to set aside the judgment of dissolution based on her mental incapacity. She later dismissed that action and in December 2010, she sued her former husband for breach of his fiduciary duty of disclosure under Family Code section 1101. The trial judge granted a motion for summary adjudication, and the appellate court affirmed, stating: “Because the prospective referral fee was not concealed, but rather the parties litigated the issue and the judgment fully adjudicated the asset, [the wife’s] recourse was an action to set aside the judgment, or a portion thereof, within the one-year limitations period specified in the relevant portion of section 2122, subdivision (f). Because her action was untimely, the court lacked jurisdiction over the matter.” Georgiou v. Leslie (Cal. App. Fourth Dist., Div. 1; July 31, 2013) 218 Cal.App.4th 561.