## Facts

- Charles W. Burnett, a Texas inmate proceeding pro se and in forma pauperis, paid attorney David Sharp a $3,000 retainer to represent him in a criminal matter.
- Burnett alleged Sharp performed minimal work (primarily obtaining multiple resets) and Burnett replaced him with other counsel.
- Burnett and his family repeatedly demanded return of the allegedly unearned portion of the retainer; Sharp allegedly did not respond or refund any money.
- Burnett sued Sharp asserting breach of fiduciary duty, money had and received, conversion, negligence (legal malpractice), and intentional misrepresentation.
- The trial court dismissed the suit with prejudice before service and without a hearing, stating Burnett “failed to state a cause of action as a matter of law.”

## Issues

1. Whether the trial court’s dismissal should be treated as a Chapter 14 dismissal of an inmate in forma pauperis suit as frivolous for having no arguable basis in law.
2. Whether Burnett’s pleaded claims, liberally construed, had an arguable basis in law or were based on indisputably meritless legal theories under Chapter 14.

## Decision

- The appellate court treated the order as a Chapter 14 dismissal for “no arguable basis in law” and applied de novo review.
- The court reversed the dismissal of the breach of fiduciary duty, money had and received, and conversion claims and remanded those claims.
- The court affirmed the dismissal of the negligence (legal malpractice) and intentional misrepresentation claims.
- The judgment was affirmed in part and reversed and remanded in part.

## Legal Principles

- In Chapter 14 inmate IFP cases, a claim may be dismissed as frivolous when it has no arguable basis in law, meaning it is based on an indisputably meritless legal theory.
- Pro se inmate pleadings are construed liberally under Texas pleading rules; Chapter 14 does not impose a more stringent pleading standard.
- Attorney–client relationships are fiduciary as a matter of law; allegations that an attorney wrongfully retained unearned client funds can state an arguable breach of fiduciary duty claim.
- Money had and received is an equitable restitution claim that lies when, in equity and good conscience, the defendant should not keep the money.
- Conversion may apply to specific, identifiable funds; allegations of wrongful retention of a specific retainer (or identifiable portion) can provide an arguable basis for conversion at the pleading stage.
- A legal malpractice claim requires allegations of negligent representation causing damages beyond a fee dispute; mere non-refund of unearned fees, without distinct causation and injury, is insufficient as pleaded.
- Intentional misrepresentation requires allegations of a materially false representation and reliance; conclusory fraud labeling tied only to a fee-refund dispute is insufficient as pleaded.

## Conclusion

The court held that Chapter 14 permits dismissal only when claims rest on indisputably meritless legal theories; allegations that an attorney retained unearned retainer funds stated arguable claims for breach of fiduciary duty, money had and received, and conversion, but did not adequately plead legal malpractice or intentional misrepresentation.


Burnett v. Sharp, 328 S.W.3d 594 (Tex. App.—Houston [14th Dist.] 2010, no pet.)