Kansallis Finance LTD v. Fern

Stephen Jones, a partner at the Fern, Anderson, Donahue, Jones & Sabatt law firm (defendant), issued a fraudulent opinion letter on firm letterhead to Kansallis Finance Ltd. (plaintiff), who won an $880,000 judgment against Jones and his co-conspirators and saw Jones criminally convicted, but couldn't actually collect the money from Jones or his co-conspirators. Kansallis then sued the Fern firm itself, hoping to hold the partnership liable for Jones's fraud. The jury was instructed that Jones's conduct would fall within the scope of the partnership if it was the type of work a law partner would do, within the appropriate time and place, and at least partly motivated by a purpose to serve the partnership; the jury found Jones lacked apparent authority and that his fraud failed all three prongs of that scope-of-partnership test. The Court of Appeals for the Second Circuit affirmed those factual findings and certified questions to the Massachusetts high court, including whether intent to benefit the partnership is actually required for liability.