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future earnings representing the amount petitioner would have
earned if he had worked for Balfour until age 65, and (6) $2
million in emotional distress.
Shortly after the additional interrogatory responses were
served on Balfour's attorney, but before she had read them,
Balfour and petitioner agreed to settle the litigation by having
Balfour pay petitioner $550,000. Balfour intended that this
payment would compensate petitioner for commissions purportedly
owed him, primarily on the AT&T account; it was not intended to
compensate petitioner for a purported constructive discharge or
physical or emotional injury. At the time of settlement, neither
Balfour nor its attorney knew that petitioner was claiming
damages for an emotional injury, and petitioner had never given
Balfour any reports detailing such an injury.
Beginning in mid-September 1993, the attorneys for Balfour
and petitioner began discussing the language to be used in the
settlement agreement, and the attorneys exchanged drafts of the
agreement. Petitioner's attorney asked that the agreement
allocate $425,000 of the $550,000 settlement payment to a claim
for constructive discharge and that the remaining $125,000 be
allocated to attorney's fees. Petitioner's attorney made this
request because petitioner's accountant had advised the attorney
that such an allocation would render the settlement proceeds
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