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https://rain-kys.xyz/
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████████ ‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾
Ella Nelson is a mentally unstable attention seeking whore that jumped from community to community for attention.
She used to identify herself as a member of LGBT and listened to tranny rappers, then started larping as a nazi
(keep in mind that she is not a nazi and people like her cannot be nazis)
but got rejected hard by the community, which led her to join a cutting child porn cult called 764 (see proof below).
After getting confronted, she said that national socialists were rude to her and that her image has gotten ruined in the community.
Ella Nelson has openly asked for child pornography, distributed it and admitted to liking it.
It is also funny how she larped as a nazi tradwife whilst allowing gore and porn into her server, and wearing the typical e-whore alt-girl tiktok girl
Kittens speaking here
Welcome to Sebastian Engel aka Flesh's Dox ! :) I was previously friends with the retard but then he decided to secretly snake me to an
E-Girl on discord, how fucking pathetic, I've known Killself/Flesh for about 5-6 years, we used to play Minecraft together when we were younger,
a bit sad, he went over snaking his friend for a little girl on discord.com.
Credits to kittens for the basic information on flesh..
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FLESH:
Full Name: Sebastian Engel
Sex: Male
Age: 15
Eye Color: Green
Height: 5`11
Weight: 138 lb
Aliases: Killself, Flesh, Kilself, and Bling, 0cp
Home Address: 827 Briarpoint Pl San Diego, CA 92154
IP Address : 216.19.202.132
Picture(s): https://z.zz.fo/8Ne7p.png -
- https://z.zz.fo/zfooj.png ( We doxxed him off his mothers google voice )
- https://z.zz.fo/aIzCz.png ( His mother with friends :> )
- https://z.zz.fo/aHcAX.png ( Hi so like I'm really drunk )
- https://z.zz.fo/MgZPB.png ( IP )
- https://z.zz.fo/WJuSw.png ( :D )
LOST:
Full Name: Ella Nelson
Age: 15 - Feb, 24th, 2006
Usernames: ellavator, ellavator666, purearyan, xanr.io, xanrio, torbrowserlol, halfthecrimes, halfdacrimes
Addresses: 6453 Bay Vista Ct, Indianapolis, IN 46250, USA, 910 Noble Run Apt G, Noblesville, IN 46060-5227
Compilation: https://i.imgur.com/TTfdHkL.png
Cutting Picture 1: https://i.imgur.com/HxIIy8H.png
Cutting Picture 2: https://i.imgur.com/LW37m8s.png
Gypsy Fangirl: https://i.imgur.com/81GJYeW.png
Retard In A Wig 1: https://i.imgur.com/gRlq5zM.png
Retard In A Wig 2: https://i.imgur.com/qma4jBN.png
Retard In A Wig 3: https://i.imgur.com/fa7E8j2.png
Black Lives Matter!: https://i.imgur.com/kLpiqxr.png
Chat: https://i.imgur.com/tPOVo1x.png
Sad Telegram: https://i.imgur.com/I8Kjvyv.png
Meet and Greet: https://i.imgur.com/x0ub2sX.png
Wishlist: https://i.imgur.com/SWGEaPh.png
Twitter 1: https://i.imgur.com/dURRnyp.png
Twitter 2: https://i.imgur.com/6yPfSSp.png
Pedo Hunterz: https://i.imgur.com/NIAOQrd.png
Trolled: https://i.imgur.com/A2jKRkd.jpg
Inbred Proof: https://i.imgur.com/Q7Ytl8T.png
764: https://i.imgur.com/apAz6LA.png
"copious amount of cp": https://i.imgur.com/6iyfVMp.png
Dad dead: https://i.imgur.com/w5ZiMzD.png
Young Ella 1: https://i.imgur.com/b3JZYQa.png
Young Ella 2: https://i.imgur.com/Bs7LjMC.png
Young Ella with Cooper: https://i.imgur.com/uA9M05J.png
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Flesh's Families Previous Addresses
Previous Addresses :
643 Hampton Ridge Dr, Akron OH 44313, Summit County, Recorded May 2011, Home Phone: (330) 864-0684
333 Kimberly Rd, Akron OH 44313, Summit County, Recorded October 2007, Home Phone: (330) 864-0684
260 E Chestnut St, Chicago IL 60611, Cook County, Recorded November 2007
1700 W Market St, Akron OH 44313, Summit County, Recorded July 2007
30 E Huron St, Chicago IL 60611, Cook County, Recorded January 2001
900 N Dewitt Pl, Unit 1002, Chicago IL 60611, Cook County, Recorded October 1996
900 N Dewitt Pl, Unit 1004, Chicago IL 60611, Cook County, Recorded July 1995
57 W 82nd St, New York NY 10024, New York County, Recorded February 1988
50 W 85th St, Unit 10, New York NY 10024, New York County, Recorded June 1988
20 W 84th St, New York NY 10024, New York County, Recorded March 1988
22100 Burbank Blvd, Unit 308, Woodland Hills CA 91367, Los Angeles County, Recorded July 1988
643 Hampton Ridge Dr, Akron OH 44313, Summit County, Recorded April 2008, Home Phone: (312) 654-0689
1700 W Market St, Akron OH 44313, Summit County, Recorded July 2007
272 W 77th St, Unit 1A, New York NY 10024, New York County, Recorded July 1990
900 N Dewitt Pl, Unit 1002, Chicago IL 60611, Cook County, Recorded April 2008
50 W 85th St, Unit 10, New York NY 10024, New York County, Recorded June 1988
22100 Burbank Blvd, Unit 308, Woodland Hills CA 91367, Los Angeles County, Recorded July 1988
827 Briarpoint Pl, San Diego CA 92154, San Diego County, Recorded June 2020
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Phone Numbers
for Paul Ehrlich in San Diego, CA
(330) 864-0684 (Primary Phone)
Landline
Ameritech Ohio
First reported October 2007
(312) 654-0689
Landline
Ameritech Illinois
First reported April 2021
(586) 484-6627
Wireless
Cellco Partnership dba Verizon Wireless - MI
First reported April 2021
(601) 927-1230
Wireless
New Cingular Wireless PCS LLC - GA
First reported April 2021
(623) 261-5322
Wireless
Sprint Spectrum LP
First reported April 2021
(773) 893-4614
Landline
Access One Inc - IL
First reported April 2011
(312) 893-4614
Landline
Broadwing Communications LLC - IL
First reported March 1988
(212) 769-9240
Landline
Verizon New York Inc
First reported March 2016
(312) 587-7958
Landline
Ameritech Illinois
First reported March 2016
(818) 594-8500
Landline
Pacific Bell Telephone Company
First reported March 2016
(917) 587-7958
Wireless
New Cingular Wireless PCS LLC - DC
First reported March 2016
▓██████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████
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Info For : paulmehrlich1962@gmail.com
paulmehrlich1962@gmail.com:8nituvo20
"paulmehrlich1962@gmail.com","oregon2000"
22837040 paulmehrlich paulmehrlich1962@gmail.com 887581c23e8d2d60b51fe8fce00156ee75ae447d 24.123.253.181
11678085 Paul Ehrlich paulmehrlich1962_g_3941 paulmehrlich1962@gmail.com 2010-09-10 12:10:37 2010-09-10 12:10:37 NULL 1 585826b2-935e-403b-b16d-50b38910b266 0 0000-00-00 NULL NULL NULL 2010-09-10 12:10:37 3 0 google NULL
6buthiha52,paulmehrlich1962@gmail.com,8nituvo20,410779061
Info For : jbeckhamlat@gmail.com
jbeckhamlat@gmail.com:4fb2433f9232b1588d4c2bb05f9fb40c5585bba1:EVoWUDq0gDupyvtARFQ
535320 40ccb439f20877f95305ad41d2aa1f11f078d8273ea7a0d818cc72c36760e4fe 404300cc422e684d4f3be0119950ad1cb05c92de jbeckhamlat@gmail.com United States John Beckham 1957-01-14
jbeckhamlat@gmail.com:john0040
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jbeckhamlat@gmail.com:harrypotte
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dm_5115ba4199034:jbeckhamlat@gmail.com
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jbeckhamlat@gmail.com:560c9b95f6405a88285cc667277d9cadecccd6da
Info For : dmcconnell2009@yahoo.com
dmcconnell2009@yahoo.com,Dianne,Mcconnell,3616 klerner lane,Louisville,IN,40201,8129894477,F,0000-00-00,joblistingspro.com,68.73.147.202,2019-12-11 06:36:53
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IP Address: 208.89.160.72 │ \n │ Hostname: ipv4-208-89-160-72.greenhousedata.net │\n │ Continent: NORTH AMERICA │\n │ Country: UNITED STATES
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Flesh's Mom
Paul Ehrlich in San Diego, CA
Age: 60
Current Address: 827 Briarpoint Pl, San Diego CA 92154, San Diego County, Since June 2020
Full Name: Paul M Ehrlich
Email: paulmehrlich1962@gmail.com
Also Known As :
Paul Ehrlich
Paul Erlich
Paul Beckham
Paul Ehrlich Macgregor
Paul T Ehrlich
Paul M Ehrilch
Numbers: (330) 864-0684 (Primary Phone)
Landline
Ameritech Ohio
First reported October 2007
(312) 654-0689
Landline
Ameritech Illinois
First reported April 2021
(586) 484-6627
Wireless
Cellco Partnership dba Verizon Wireless - MI
First reported April 2021
(601) 927-1230
Wireless
New Cingular Wireless PCS LLC - GA
First reported April 2021
(623) 261-5322
Wireless
Sprint Spectrum LP
First reported April 2021
(773) 893-4614
Landline
Access One Inc - IL
First reported April 2011
(312) 893-4614
Landline
Broadwing Communications LLC - IL
First reported March 1988
(212) 769-9240
Landline
Verizon New York Inc
First reported March 2016
(312) 587-7958
Landline
Ameritech Illinois
First reported March 2016
(818) 594-8500
Landline
Pacific Bell Telephone Company
First reported March 2016
(917) 587-7958
Wireless
New Cingular Wireless PCS LLC - DC
First reported March 2016
Flesh's Mom's Relatives
John Beckham (Husband)
Paul Ehrlich
Scott Ehrlich
Blair Ehrlich
Carolyn Ehrlich
Dylan Ehrlich
Linda Leslie
Paige Ehrlich
Venus Boykin
Venus Jackson
Alexis Ehler
Ann Brown
Anthony Perry
Ayana Hayes
Brown Saban
Carol Brown
Earldean Boykin
Earldean Jackson
Earldean Jackson
Earldean Jackson
Hattie Lewis
Jack Lypka
Jimmie Brown
Kimberly Jackson
Larry Aldridge
Mary Dwan
Patricia Smith
Robert Behic
Saban Brown
Sharon Jackson
Summer Brown
Teamer Beal
Venus Boykin
Venus Jackson
Flesh's Mom's Associates
Ashley Witmer
Elizabeth Flanagan
George Rudenauer
Kari Uno
Megan Ginkel
Michael Cofield
Michael Mcmonagle
Billy Newton
Flesh's Mom's Neighbors
Imelda Marquez, (619) 274-1444, 824 Briarpoint Pl, San Diego CA 92154
A JR, 820 Briarpoint Pl, San Diego CA 92154
Amalia Quintero, 817 Briarpoint Pl, San Diego CA 92154
C JR, (619) 671-9927, 816 Briarpoint Pl, San Diego CA 92154
B Alwaque, 812 Briarpoint Pl, San Diego CA 92154
Paul Ehrlich is likely married to John Wallace Beckham. Paul and John have lived together in at least 11 separate locations.
Paul M Ehrlich is 60 years old. Currently Paul lives at the address 827 Briarpoint Pl, San Diego CA 92154. Paul has lived at this San Diego, CA address for about 1 year, after moving in around June of 2020. Paul previously lived at 643 Hampton Ridge Dr, Akron OH 44313, starting in May of 2011. Going further back, starting in October of 2007, Paul lived at 333 Kimberly Rd, Akron OH 44313.
It is likely that Paul Ehrlich is married to John Wallace Beckham, and they have lived together in at least 11 different locations. The following people are relatives or close associates of Paul: Paul Ehrlich, Scott Ehrlich, Blair Ehrlich, Carolyn Ehrlich, Dylan Ehrlich, Linda Leslie, Paige Ehrlich, Venus Boykin, Venus Jackson and Alexis Ehler.
Paul's current phone number is (330) 864-0684. This Landline number was issued by 'Ameritech Ohio', first reported in public records on October of 2007. Past phone numbers for Paul include (312) 654-0689, (586) 484-6627 and (601) 927-1230. The primary email address for Paul is paulmehrlich1962@gmail.com.
Flesh's Dad
John Beckham, in Akron, OH
Full Name: John Wallace Beckham
Email: jbeckhamlat@gmail.com
Age: 65
Ip: 74.219.98.234
Also Known As: John W Beckham, John Beckham, J Beckham, John H Beckham, John Beckaman, B John
Address: 333 Kimberly Rd, Akron OH 44313, Summit County, Since September 2007
Phone Numbers:
(330) 864-0684 (Primary Phone), Landline, Ameritech Ohio, First reported September 2007
(312) 654-0689, Landline, Ameritech Illinois, First reported November 2002
(330) 983-4667, Landline, Time Warner Cable Information Services (Ohio) LLC - OH, First reported May 2011
(773) 893-4614, Landline, Access One Inc - IL, First reported April 2011
(330) 801-3733, Wireless, Cellco Partnership dba Verizon Wireless - OH, First reported September 2014
(330) 864-0685, Landline, Ameritech Ohio, First reported June 2011
(330) 962-2931, Wireless, Sprint Spectrum LP, First reported August 2016
(212) 769-9240, Landline, Verizon New York Inc, First reported March 2016
(310) 456-3796, Wireless, Frontier California Inc, First reported March 2016
(312) 339-4854, Wireless, Cellco Partnership dba Verizon Wireless - IL, First reported March 2016
(312) 587-7958, Landline, Ameritech Illinois, First reported March 2016
(312) 664-2483, Landline, Ameritech Illinois, First reported March 2016
(312) 893-4614, Landline, Broadwing Communications LLC - IL, First reported March 2016
Flesh's Dad's Relatives
Paul Ehrlich (Wife)
Linda Leslie
Venus Boykin
Venus Jackson
Andrew Smith
Ann Williams
Anthony Perry
Brown Saban
Clara Spraggins
Earldean Boykin
Earldean Jackson
Earldean Jackson
Frank Leslie
Gregory Spraggins
Iris Williams
John Dwan
Joseph Holloway
Kittrick Smith
Larry Aldridge
Leroy Jackson
Luella Williams
Flesh's Dad's Associates
Albert Haverstock
Barry Moss
Betty Smith
Burton Weitzman
Carol Stacey
Creedence Gonzalez
Eileen Geary
Jan Marinello
Jennifer Burke
John Janecek
Joyce Sigmon
Judith Kaufman
Lawrence Glass
Mara Schieber
Martin Kessler
Max Gendel
Meryl Hauser
Michael Bernardo
Michael Jaron
Paul Ehrlich
Renee Yang
Robert Bailey
Susan Crabtree
Wendy Kase
Wu Hung
Martha Slaughter
Thomas Cirone
Barbara Meyers
Barbara Siepker
Barry Nannini
Bryan Bilczewski
Carla Inwood
Carol Ginsburg
Carole Clark
Carole Shapero
David Holmes
Donald Mclaughlin
Doris Sternberg
Frank Siepker
Gary Strauss
Geoffrey Anderson
George Knight
Harry Shlensky
Howard Mcfarland
Ira Halper
Jack Weiner
Janet Stopka
Jerome Ginsburg
Joan Young
Katherine Gilbert
Lawrence Gottlieb
Michael Winter
Paul Yakin
Sandra Mcnaughton
Susan Cord
Susan Hill
Susan Joynt
Thomas Little
Venancio Bustos
Virginia Ertle
Flesh's Dad's Neighbors
Tyler Houska, (330) 666-3435, 318 Kimberly Rd, Akron OH 44313
A JR, (330) 864-5069, 317 Kimberly Rd, Akron OH 44313
William Murty, 356 Kimberly Rd, Akron OH 44313
Nicholas Rosso, (330) 867-9648, 369 Kimberly Rd, Akron OH 44313
Nina Gerhardt, 370 Kimberly Rd, Akron OH 44313
John Beckham is likely married to Paul M Ehrlich. John and Paul have lived together in at least 11 separate locations.
John Wallace Beckham is 65 years old. Currently John lives at the address 333 Kimberly Rd, Akron OH 44313. John has lived at this Akron, OH address for about 14 years, after moving in around September of 2007. John previously lived at 643 Hampton Ridge Dr, Akron OH 44313, starting in April of 2008. Going further back, starting in July of 2007, John lived at 1700 W Market St, Akron OH 44313.
It is likely that John Beckham is married to Paul M Ehrlich, and they have lived together in at least 11 different locations. The following people are relatives or close associates of John: Linda Leslie, Venus Boykin, Venus Jackson, Andrew Smith, Ann Williams, Anthony Perry, Brown Saban, Clara Spraggins, Earldean Boykin and Earldean Jackson.
John's current phone number is (330) 864-0684. This Landline number was issued by 'Ameritech Ohio', first reported in public records on September of 2007. Past phone numbers for John include (312) 654-0689, (330) 983-4667 and (773) 893-4614. The primary email address for John is jbeckhamlat@gmail.com.
Lost's Dad :
Name: Jeffrey Nathanael Nelso
Age: 40
Birthday: Jul 13, 1981
Aliases: Jeff Nielson, Jeffrey Nielson, Jeffery Nielson
Contact Information
Phone Numbers:
(435) 881-2427
VIEW PHONE DETAILS
Line Type
Mobile
Carrier Location
Salt Lake City-Brigham City, UT 84304
Phone Number
(317) 844-8852
Line Type
Carrier Location
Carmel, IN 46032
Phone Number
(435) 750-8960
Line Type
Landline
Carrier Location
Logan, UT 84304
Phone Number
(801) 750-8960
Line Type
Mobile
Carrier Location
Salt Lake City, UT 84009
Phone Number
(435) 750-4960
Line Type
Landline
Carrier Location
gan, UT 84304
Phone Number
(317) 802-0173
Line Type
Landline
Carrier Location
Indianapolis-Trinity, IN 46107
TALK AMERICA INC - MI (CAVALIER)
Phone Number
(313) 362-9885
Line Type
Landline
Carrier Location
Southfield, MI 48141
Prepaid
Phone Number
(317) 566-0542
Line Type
Landline
Carrier Location
Carmel, IN 46032
Phone Number
(317) 705-0907
Line Type
Landline
Carrier Location
Carmel, IN 46032
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Picture of house : https://www.google.com/maps/place/827+Briarpoint+Pl,+San+Diego,+CA+92154/@32.5805274,-117.0286359,3a,75y,123.69h,90t/data=!3m6!1e1!3m4!1sZPmugh2Wx8C-YFH2PpzD7Q!2e0!7i16384!8i8192!4m5!3m4!1s0x80d94f2b0ec57265:0x6bf5f9fb533d40fe!8m2!3d32.5804185!4d-117.0284452
Listed by Patti McKelvey •DRE #00956130 • Coldwell Banker West
619-271-8300 (agent)
Patti@McKelveyRealty.com (agent)
Last updated May 14, 2009
Source:CRMLS #90019104
Status:
Property Type: Single Family Residence
HOA Dues: $38/month
Year Built: 2005
Community: 92154 - Otay Mesa
Lot Size: 4,950 Sq. Ft.
MLS#: 90019104
Price Insights: $999,053
Price/Sq.Ft.: $393
3.5%
Property Details for 827 Briarpoint Pl:
Interior Features
Laundry Information
Has Laundry
Individual Room, Gas Dryer Hookup
Kitchen Information
Appliances: Dishwasher, Garbage Disposal
Has Appliances
Bathroom Information
# of Baths (Full): 3
Heating Information
Forced Air, Natural Gas
Has Heating
Interior Features
Levels: Two
Parking / Garage, Homeowners Association, School / Neighborhood, Taxes / Assessments
Parking / Garage Information
Attached Garage
# of Garage Spaces: 3
Carport Attached
Has Parking
# of Parking Spaces: 3
Homeowners Association
Is Part of Association
Association Name: ON FILE
Association Fee: $38
Association Fee Frequency: Monthly
School Information
High School District: Other
Assesments Information
Assessments: Mello-Roos
Exterior Features
Exterior Information
Roof: Tile
Fencing: Partial
Has Fence
Construction Materials: Stucco
Exterior Features
Pool Features: None
Property / Lot Details
Lot Information
Lot Size Source: Assessor's Data
Lot Features: Lot-Level/Flat
Lot Dimensions Source: Assessor
Property Information
Living Area Source: Assessor's Data
Parcel Number: 6453703800
Total # of Stories: 2
Location Details, Listing Information
Location Information
Other Subdivision Name: SAN DIEGO
Directions: [Cross Street(s)]: Golden Sands Pl
Zoning: R1
Listing Information
Buyer Agency Compensation: 3.500
Buyer Agency Compensation Type: %
Agent & Office Information
Listing Agent Information
List Agent First Name: Patti
List Agent Last Name: McKelvey
Listing Office Information
List Office Name: Coldwell Banker West
Selling Agent Information
Buyer Agent First Name: Pat
Buyer Agent Last Name: Torres
Selling Office Information
Buyer Office Name: Coldwell Banker West
Sale & Tax History for 827 Briarpoint Pl :
Year Property Tax Land + Additions = Assessed Value
2021 $9,599 (+1.5%) $237,933 $237,933 $475,866
2020 $9,452 (+3.3%) $237,933 $237,933 $475,866
2019 $9,153 (+33.1%) $235,494 $235,494 $470,988
2018 $6,878 (+1.6%) $230,877 $230,877 $461,754
2017 $6,769 (+3.2%) $221,912 $221,912 $443,824
2016 $6,559 (+0.9%) $221,912 $221,912 $443,824
2015 $6,500 (+1.4%) $217,561 $217,561 $435,122
2014 $6,412 (+0.7%) $210,097 $210,097 $420,194
2013 $6,369 (+2.6%) $210,097 $210,097 $420,194
2012 $6,205 (+2.7%) $209,148 $209,148 $418,296
2011 $6,042 (+2.1%) $205,048 $205,048 $410,096
2010 $5,916 (−2.7%) $201,028 $201,028 $402,056
2009 $6,080 (−13.0%) $199,526 $199,526 $399,052
2008 $6,992 $200,000 $200,000 $400,000
Dates:
May 8, 2009
Sold (MLS)
CRMLS #90019104
$400,000
Mar 30, 2009
Listed
CRMLS #90019104
$389,900
Beds5
Baths3
Sq. Ft.2,541
Stories—
Lot Size4,951 Sq. Ft.
StyleSingle Family Residential
Year Built2005
Year Renovated2005
CountySan Diego County
APN6453703800
Home facts updated by county records on Apr 7, 2022.
Sale Proceeds
Home Sale Price
$999,053
Outstanding Mortgage
$225,000
Selling with Traditional AgentSelling with Redfin Agent
+$9,991
$717,185$727,175
2.5% ($24,976)1.5% ($14,986)
Get $9,991 More Selling Your Home with a Redfin Agent
Schedule Selling Consultation
Rental Estimate for 827 Briarpoint Pl
Edit Home Facts to improve accuracy.
$3,645 - $4,442 / mo
Market trends for San Diego
Single family home, 4+ beds
$4,450 / mo
Median rent
+7.23%
Since Jan 2021
Rental estimate based on recent rentals.
Activity for 827 Briarpoint Pl
0
0
0
0
Schools
7
/10
Ocean View Hills School
Public, K-6 • Serves this home
985
Students
0.6mi
Distance
23 reviews
7
/10
Vista Del Mar
Public, 7-8 • Serves this home
413
Students
0.7mi
Distance
0 reviews
3
/10
San Ysidro Middle School
Public, 7-8 • Serves this home
656
Students
1.5mi
Distance
2 reviews
4
/10
San Ysidro High School
Public, 9-12 • Serves this home
2426
Students
1.3mi
Distance
19 reviews
School data is provided by GreatSchools, a nonprofit organization. Redfin recommends buyers and renters use GreatSchools information and ratings as a first step, and conduct their own investigation to determine their desired schools or school districts, including by contacting and visiting the schools themselves.
Redfin does not endorse or guarantee this information. School service boundaries are intended to be used as a reference only; they may change and are not guaranteed to be accurate. To verify school enrollment eligibility, contact the school district directly.
Around This Home
Transportation in Ocean Crest
37 / 100
Car-Dependent
Walk Score®
31 / 100
Some Transit
Transit Score®
11 / 100
Somewhat Bikeable
Bike Score®
Places Nearby
10 groceries, 43 restaurants, 10 parks
Climate Risk
About Climate Risk
Most homes have some risk of natural disasters, and may be impacted by climate change due to rising temperatures and sea levels.
Flood Risk
Provided by
Flood Factor
Minimal - This property is unlikely to flood over the next 30 years.
Environmental Risks
Provided by
Storm Risk
Relatively Low - 13 storms expected in 2050
Drought Risk
Extreme - Water stress expected to be 96% in 2050
Heat Risk
Relatively Low - 22 hot days expected in 2050
Fire Risk
Moderate - 0.9% of land expected to burn in 2050
Climate risk data is provided for informational purposes only by Flood Factor™ and ClimateCheck®.
Questions or feedback about this data? Get help at Flood Factor® and climatecheck.com
Market Insights for 827 Briarpoint Pl
Based on homes from MLS and/or public records
Redfin
California
San Diego
Ocean Crest
Single-Family Home Sales (Last 30 days)
Otay MesaNeighborhood
$875K
Median List Price
16
Median Days on Mkt.
2
# Listed Homes
$426
Median $ / Sq. Ft.
103.3%
Median Sale-to-List
8
# Sold Homes
image
Ocean CrestNeighborhood
$875K
Median List Price
16
Median Days on Mkt.
2
# Listed Homes
$434
Median $ / Sq. Ft.
103.2%
Median Sale-to-List
7
# Sold Homes
Placeholder
92154ZIP
$720K
Median List Price
13
Median Days on Mkt.
20
# Listed Homes
$476
Median $ / Sq. Ft.
102.3%
Median Sale-to-List
30
# Sold Homes
Placeholder
San DiegoCity
$1.2M
Median List Price
10
Median Days on Mkt.
493
# Listed Homes
$750
Median $ / Sq. Ft.
106.1%
Median Sale-to-List
685
# Sold Homes
Placeholder
San Diego CountyCounty
$985K
Median List Price
11
Median Days on Mkt.
1526
# Listed Homes
$582
Median $ / Sq. Ft.
105.8%
Median Sale-to-List
1979
# Sold Homes
Placeholder
Single-Family Home Trends in Otay Mesa
Median Sale Price
$900,000
+28.0% year-over-year
# of Homes Sold
22
+10.0% year-over-year
Median Days on Market
8
+2 year-over-year
1 year3 years5 years
ShareEmbed
Location
Data
Apr 2022
Growth
% YoY
Otay Mesa
$900,000
+28.0%
See more market trends in Otay Mesa
Market Competition in Otay Mesa
Calculated over the last 3 months
88
Very Competitive
Redfin Compete Score™
0
100
Many homes get multiple offers, some with waived contingencies.
The average homes sell for about 4% above list price and go pending in around 7 days.
can sell for about 7% above list price and go pending in around 5 days.
What It Takes to Win an Offer near Otay Mesa
~$700K Offer
9 Weeks Ago
4 Beds, 3.5 Baths, ~1,750 Sq. Ft. Condo
Offer Not Accepted— Sold for $700K
Over List Price
0%
Days on Market
4
Competing Offers
2
Down Payment
~10%
David Zarraonandia
Redfin Agent
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110.33.122.75 :
City: Queanbeyan
Region: New South Wales (NSW)
Postal code: 2620
Country: Australia (AU)
Continent: Oceania (OC)
Coordinates: -35.3522 (lat) / 149.2297 (long)
Time: 2022-05-14 06:09:39 (Australia/Sydney)
NETWORK
IP address: 110.33.122.75
Hostname: n110-33-122-75.hum2.act.optusnet.com.au
Provider: Microplex PTY LTD
ASN: 4804
IP: 110.33.122.75
COUNTRY: Australia
COUNTRY ISO: AU
STATE: New South Wales
CITY: Macquarie Park
POSTAL CODE: 2113
LATITUDE: -33.7810
LONGITUDE: 151.1275
ORGANIZATION: SingTel Optus Pty Ltd
ISP: SingTel Optus Pty Ltd
IP Location via DB-IP(PRODUCT: API, REAL-TIME)
IP: 110.33.122.75
COUNTRY: Australia
COUNTRY ISO: AU
STATE: New South Wales
CITY: Ryde
POSTAL CODE: 2112
LATITUDE: -33.8135
LONGITUDE: 151.104
ASN: 4804
AS-Name: MPX-AS
IS PROXY: No
IS CRAWLER: No
THREAT LEVEL: low
ORGANIZATION: SingTel Optus Pty Ltd
ISP: SingTel Optus Pty Ltd
IP Location via IpInfo(PRODUCT: API, REAL-TIME)
IP: 110.33.122.75
COUNTRY: Australia
COUNTRY ISO: AU
STATE: New South Wales
CITY: Sydney
POSTAL CODE: 1715
LATITUDE: -33.7378
LONGITUDE: 151.0722
ASN: AS4804
ORGANIZATION: Microplex PTY LTD
IP Geo Location via IPGeoLocation.io(PRODUCT: API, REAL-TIME)
IP: 110.33.122.75
COUNTRY: N/A
COUNTRY ISO: N/A
STATE: N/A
CITY: N/A
POSTAL CODE: N/A
LATITUDE: N/A
LONGITUDE: N/A
ASN: N/A
IS BOT: N/A
IS PROXY: N/A
PROXY TYPE: N/A
IS SPAM: N/A
IS TOR: N/A
ORGANIZATION: N/A
ISP: N/A
216.19.202.132 :
IP: 216.19.202.132
COUNTRY: United States of America
COUNTRY ISO: US
STATE: California
CITY: Los Angeles
POSTAL CODE: 90001
LATITUDE: 34.0522
LONGITUDE: -118.2436
ORGANIZATION: Jeneral Technologies
ISP: Jeneral Technologies
IP Location via DB-IP(PRODUCT: API, REAL-TIME)
IP: 216.19.202.132
COUNTRY: United States
COUNTRY ISO: US
STATE: California
CITY: Los Angeles
POSTAL CODE: 90009
LATITUDE: 34.0522
LONGITUDE: -118.244
ASN: 203999
AS-Name: GeekyWorks
IS PROXY: No
IS CRAWLER: No
THREAT LEVEL: low
ORGANIZATION: GetNet Inc
ISP: GetNet Inc
IP Location via IpInfo(PRODUCT: API, REAL-TIME)
IP: 216.19.202.132
COUNTRY: United States
COUNTRY ISO: US
STATE: California
CITY: Los Angeles
POSTAL CODE: 90076
LATITUDE: 34.0522
LONGITUDE: -118.2437
ASN: AS203999
ORGANIZATION: Geekyworks IT Solutions Pvt Ltd
IP Geo Location via IPGeoLocation.io(PRODUCT: API, REAL-TIME)
IP: 216.19.202.132
COUNTRY: N/A
COUNTRY ISO: N/A
STATE: N/A
CITY: N/A
POSTAL CODE: N/A
LATITUDE: N/A
LONGITUDE: N/A
ASN: N/A
IS BOT: N/A
IS PROXY: N/A
PROXY TYPE: N/A
IS SPAM: N/A
IS TOR: N/A
ORGANIZATION: N/A
ISP: N/A
IP: 24.123.253.181
COUNTRY: United States of America
COUNTRY ISO: US
STATE: Texas
CITY: Dallas
POSTAL CODE: 75201
LATITUDE: 32.7830
LONGITUDE: -96.8066
ORGANIZATION: Charter Communications Inc
ISP: Charter Communications Inc
IP Location via DB-IP(PRODUCT: API, REAL-TIME)
IP: 24.123.253.181
COUNTRY: United States
COUNTRY ISO: US
STATE: Virginia
CITY: Vienna
POSTAL CODE: 22180
LATITUDE: 38.9012
LONGITUDE: -77.2653
ASN: 10796
AS-Name: TWC-10796-MIDWEST
IS PROXY: No
IS CRAWLER: No
THREAT LEVEL: low
ORGANIZATION: Charter Communications Inc
ISP: Charter Communications Inc
IP Location via IpInfo(PRODUCT: API, REAL-TIME)
IP: 24.123.253.181
COUNTRY: United States
COUNTRY ISO: US
STATE: Ohio
CITY: Kenton
POSTAL CODE: 43326
LATITUDE: 40.6470
LONGITUDE: -83.6097
ASN: AS10796
ORGANIZATION: Charter Communications Inc
IP Geo Location via IPGeoLocation.io(PRODUCT: API, REAL-TIME)
IP: 24.123.253.181
COUNTRY: N/A
COUNTRY ISO: N/A
STATE: N/A
CITY: N/A
POSTAL CODE: N/A
LATITUDE: N/A
LONGITUDE: N/A
ASN: N/A
IS BOT: N/A
IS PROXY: N/A
PROXY TYPE: N/A
IS SPAM: N/A
IS TOR: N/A
ORGANIZATION: N/A
ISP: N/A
IP: 74.219.98.234
COUNTRY: United States of America
COUNTRY ISO: US
STATE: Ohio
CITY: Dayton
POSTAL CODE: 45390
LATITUDE: 39.7589
LONGITUDE: -84.1916
ORGANIZATION: Charter Communications Inc
ISP: Charter Communications Inc
IP Location via DB-IP(PRODUCT: API, REAL-TIME)
IP: 74.219.98.234
COUNTRY: United States
COUNTRY ISO: US
STATE: Ohio
CITY: Columbus
POSTAL CODE: 43215
LATITUDE: 39.9612
LONGITUDE: -82.9988
ASN: 10796
AS-Name: TWC-10796-MIDWEST
IS PROXY: No
IS CRAWLER: No
THREAT LEVEL: low
ORGANIZATION: Charter Communications Inc
ISP: Charter Communications Inc
IP Location via IpInfo(PRODUCT: API, REAL-TIME)
IP: 74.219.98.234
COUNTRY: United States
COUNTRY ISO: US
STATE: Indiana
CITY: North Madison
POSTAL CODE: 47250
LATITUDE: 38.7678
LONGITUDE: -85.3966
ASN: AS10796
ORGANIZATION: Charter Communications Inc
IP Geo Location via IPGeoLocation.io(PRODUCT: API, REAL-TIME)
IP: 74.219.98.234
COUNTRY: N/A
COUNTRY ISO: N/A
STATE: N/A
CITY: N/A
POSTAL CODE: N/A
LATITUDE: N/A
LONGITUDE: N/A
ASN: N/A
IS BOT: N/A
IS PROXY: N/A
PROXY TYPE: N/A
IS SPAM: N/A
IS TOR: N/A
ORGANIZATION: N/A
ISP: N/A
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http://link.sandiego.edu/resource/zS7mPOE3lKA/
https://sandiego.bibliocommons.com/item/show/561217161
https://en.wikipedia.org/wiki/Paul_R._Ehrlich
https://oac.cdlib.org/findaid/ark:/13030/kt3r29r8pf/entire_text/
https://www.researchgate.net/publication/332910383_Arthur_M_Silverstein_Paul_Ehrlich's_receptor_immunology_the_magnificent_obsession_San_Diego_and_London_Academic_Press_2002_pp_xix_202_illus_US7500_hardback_0-12-643765-3
https://www.proquest.com/scholarly-journals/paul-ehrlichs-receptor-immunology-magnificent/docview/236663879/se-2
https://muse.jhu.edu/article/43567/summary
https://library.ucsd.edu/dc/object/bb5564457t
https://calisphere.org/item/ark:/20775/bb5564457t/
https://calisphere.org/item/ark:/20775/bb7953560b/
https://www.legacy.com/us/obituaries/ohio/name/john-beckham-obituary?id=11708948
https://www.linkedin.com/in/johnbeckham
https://www.facebook.com/John.W.Beckham
https://www.ohioresidentdatabase.com/person/OH0020283304/beckham-john
https://www.usphonebook.com/john-beckham/UxATMwgzM2MzM5IzN3ITOykDN40yR
https://www.tributearchive.com/obituaries/14825656/John-W-Beckham
https://blog.zenprospect.com/people/John/Beckham/54a630387468692abf4598c9
https://clustrmaps.com/person/Beckham-7h37nb
https://foursquare.com/jbeckhamlat
https://www.goodreads.com/user/show/6031803-john-beckham
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Court of Appeals Division I
Oral Argument Calendar
Date: Tuesday, June 9, 2015
Location: Seattle , Washington
Panel: Linda Lau, James Verellen, Mary Kay Becker
9:30 AM
71034-6
Island County Superior Court 12-1-00127-9
State of Washington, Respondent v. Robert A. Baker, Appellant
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
Robert Allan Baker (Appellant) Washington Appellate Project
Nancy P Collins
State of Washington (Respondent) Island Co Prosecuting Atty
Eric Michael Ohme
71930-1
Snohomish County Superior Court 90-2-07555-7
In re the Detention of Bradley B. Ward, Respondent v. State of Washington, Petitioner
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
State of Washington (Petitioner) Malcolm Ross
Bradley B Ward (Respondent) Washington Appellate Project
Susan F Wilk
72131-3
Skagit County Superior Court 12-2-02138-7
Ford Services, LLC, Appellant v. The City of Sedro-Wooley, Respondent
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
Ford Services, LLC (Appellant) Cale Lee Ehrlich
Deutsch Bank National Trust (Respondent) John Eugene Glowney
City of Sedro Woolley (Respondent) Craig David Sjostrom
72027-9
Island County Superior Court 12-2-00469-7
Mark F. and Linda Bressler, Appellants v. Kevin and Linda Sullivan et al, Respondents
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
Linda H Bressler (Appellant) Carolyn Cliff
Mark F Bressler (Appellant) Carolyn Cliff
Linda Sullivan (Respondent) G. Geoffrey Gibbs
Kevin F Sullivan (Respondent) G. Geoffrey Gibbs
71869-0
King County Superior Court 11-2-06228-7
Harold H. Wright, Jr., et ux., Appellants v. Pierce County, et al., Respondents
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
Sydni Wright (Appellant) Dan'l Wayne Bridges
Harold H. WrightJr. (Appellant) Dan'l Wayne Bridges
Mary Robnette (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Ken Board (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
James Harai (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Mark Parfitt (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Lori Kooiman (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Mary Robnet (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Paul Pastor (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Mark Lindquist (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Gerald Horne (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
Pierce County (Respondent) Stewart Andrew Estes
Mary Ann Mcconaughy
72065-1
King County Superior Court 13-2-02307-5
William Leahy, et ux, Appellants v. Quality Loan Service Corp, et ano., Respondents
Duration: 10 minutes for each side
Litigants: Attorneys of Record:
Shalawn Leahy (Appellant) Charles M. Greenberg
William Leahy (Appellant) Charles M. Greenberg
Na Bank of America (Respondent)
Quality Loan Service Corporation (Respondent) Thomas James Moore
1:30 PM
No Oral Argument
71415-5
Snohomish County Superior Court 13-1-00236-6
State of Washington, Res/Cross-App. v. Jason Allan Williams, App/Cross-Res.
Litigants: Attorneys of Record:
Jason Allan Williams (Appellant/Cross-Respondent) Nielsen Broman Koch PLLC
Eric Broman
State of Washington (Respondent/Cross-Appellant) Seth Aaron Fine
No Oral Argument
71631-0
King County Superior Court 09-1-01751-1
State of Washington, Respondent v. Thomas Matthew Gauthier, Appellant
Litigants: Attorneys of Record:
Thomas Mathew Gauthier (Appellant) Nielsen Broman Koch PLLC
State of Washington (Respondent) Prosecuting Atty King County
Dennis John Mccurdy
No Oral Argument
71020-6
Island County Superior Court 09-2-00492-1
Walter Page, Appellant v. Raymond A. and Jacqueline K. Hovick, Respondents
Litigants: Attorneys of Record:
Walter S Page (Appellant) Pro SE
Jaqueline K Hovick (Respondent) Mark S Leen
Raymond a Hovick (Respondent) Mark S Leen
Gregory Louis Ursich
Anneliese Elizabeth Johnson
No Oral Argument
71156-3
Skagit County Superior Court 12-2-00807-1
Paul N. Hagman, Respondent v. HMC Capital Investments, Appellants
Litigants: Attorneys of Record:
Designated Broker of John L. Sco (Appellant) Russell James JensenJr.
Christopher Gough (Appellant) Russell James JensenJr.
Barbara A. Shelton (Appellant) Russell James JensenJr.
Hmc Capital Investments, Inc. (Appellant) Russell James JensenJr.
John or Jane Doe (Defendant)
John L. Scott, Inc. (Defendant)
Warren C. Williams (Defendant)
Ryan P. Hagman (Respondent) Peter Cornelius Ojala
Deborah R. Hagman (Respondent)
Paul N. Hagman (Respondent) Peter Cornelius Ojala
No. 94525-0
IN THE SUPREME COURT
OF THE STATE OF WASHINGTON
BRANDON APELA AFOA,
Respondent,
v.
PORT OF SEATTLE,
Petitioner.
AMICUS BRIEF OF WASHINGTON STATE LABOR COUNCIL
SCHWERIN CAMPBELL BARNARD
IGLITZIN & LAVITT, LLP
Dmitri Iglitzin, WSBA 17673
18 W. Mercer St., Suite 400
Seattle, WA 98119
(206) 257-6003
Attorneys for Amicus
Washington State Labor Council
i
TABLE OF CONTENTS
I. IDENTITY AND INTEREST OF AMICUS
CURIAE
1
II. INTRODUCTION AND STATEMENT OF THE
CASE
2
III. ISSUE PRESENTED 5
IV. ARGUMENT 6
A. Traditional Respondeat Superior Vicarious
Liability Survives Tort Reform
6
B. The “Buck” For Safety Has To Stop With The
Party Best Able To Protect Worker Safety At
The Multiemployer Job Site
7
C. Injured Workers Should Be Spared The Burden
Of Suing Everybody
10
D. The Port’s Arguments Fit Within A Discredited
Historical Pattern Of Employers Seeking To
Pass Off Responsibility For Industrial Accidents
To Others
11
V. CONCLUSION 13
ii
TABLE OF AUTHORITIES
Page(s)
Cases
Afoa v. Port of Seattle,
176 Wn.2d 460, 296 P.3d 800 (2013) .............................................. 4, 7
Farwell v. Boston & Worcester Rail Road,
45 Mass 49 (1842) ............................................................................. 11
George Sollitt Corp. v. Howard Chapman Plumbing &
Heating, Inc.,
67 Wn. App. 468, 836 P.2d 851 (1992) ............................................... 9
Gilbert H. Moen Co. v. Island Steel Erectors, Inc.,
128 Wn.2d 745, 912 P.2d 472 (1996) ................................................ 10
Goucher v. JR Simplot Co.,
104 Wn.2d 662, 709 P.2d 774 (1985) .............................................. 3, 4
Stute v. PBMC,
114 Wn.2d 454, 788 P.2d 545 (1990) .............................................. 3, 4
Weinert v. Bronco Nat’l Co.,
58 Wn. App. 692, 795 P.2d 1167 (1990) ............................................. 9
Statutes
RCW 4.22.030 ........................................................................................... 6
RCW 4.22.070 ........................................................................................... 6
RCW 4.22.070(1) ............................................................................. 5, 6, 12
RCW 4.22.070(1)(a) .............................................................................. 6, 7
RCW 49.17.020(4) ..................................................................................... 3
RCW 49.17.060(2) ................................................................................. 3, 5
1
I. IDENTITY AND INTEREST OF AMICUS CURIAE
The Washington State Labor Council (“WSLC” or “Labor
Council”) is the largest and most prominent advocate for the interests of
working people in Washington State. It represents approximately 600
local and state-wide unions associated with the AFL-CIO, as well as the
450,000 individuals who belong to those unions. Member unions
operating at Seattle-Tacoma International Airport (“Sea-Tac Airport”)
include the Air Line Pilots Association, the American Federation of
Government Employees, Professional Aviation Safety Specialists,
AFSCME, International Brotherhood of Electric Workers, International
Association of Fire Fighters, the Association of Flight Attendants-CWA,
United Food & Commercial Workers, International Association of
Machinists and Aerospace Workers, and the International Brotherhood of
Teamsters.
The Labor Council’s goals include providing assistance to
organizing campaigns, communications and media relations, and
legislative advocacy on behalf of its affiliates. The Labor Council
pursues these goals in a variety of ways, including legislative lobbying,
educational programs, financial and strategic support to local unions,
initiative campaigns, and legal action, including the filing of amicus
briefs.
2
II. INTRODUCTION AND STATEMENT OF THE CASE
It is a matter of public record that ground safety problems persist
at Sea-Tac Airport. In March 2016, the Washington State Department of
Labor and Industries (“DLI”) fined Menzies Aviation, the largest ground
service provider at Sea-Tac Airport, $62,000 for 16 violations of WISHA
rules pertaining to poor maintenance of ground service equipment,
including malfunctioning or deficient engines, brakes, gears, steering,
electrical systems and tires, and other safety violations. See, e.g., Steve
Wihelm, “Alaska Airlines, baggage-handler Menzies fined by labor
regulators,” PUGET SOUND BUSINESS JOURNAL (March 8, 2016)
(https://www.bizjournals.com/seattle/news/2016/03/08/alaska-airlinesbaggage-handler-menzies-fined-by.html); Sydney Brownstone, “State
Fines Alaska Airlines for Failing to Keep Baggage Handlers Safe,” THE
STRANGER (March 8, 2016)
(https://www.thestranger.com/slog/2016/03/08/23680676/state-finesalaska-airlines-for-failing-to-keep-baggage-handlers-safe); “Alaska
Airlines Cited For Unsafe Working Conditions,” KIRO 7 NEWS (March
7, 2016) (http://www.kiro7.com/news/li-cites-alaska-airlines-for-unsafeworking-conditions/149315730A). DLI found that these ground service
employees working at the airport have four times the likelihood of injury
as compared to other workers in their risk class. Id. In the record from
3
this trial, Mark Coates, the senior Port manager in charge of safety at the
airport, admitted that the airport is an “inherently dangerous
environment.” Ex. 112 p.1.
The hard-working men and women we represent deserve
protection by this Court from the Port’s efforts to avoid its obligation to
provide the safest possible working environment.
Unfortunately, the record in this case shows that the Port has long
been acting as a “law unto itself” in defiance of clear holdings of this
Court as to the meaning of the WISHA Specific Duty Clause, RCW
49.17.060(2). Since 1985 and 1990, this Court has made it clear that
statutory WISHA employers owe a nondelegable duty to comply with
WISHA regulations under RCW 49.17.060(2) that runs to any employee
of any employer on the jobsite. Stute v. PBMC, 114 Wn.2d 454, 460, 788
P.2d 545 (1990); Goucher v. JR Simplot Co., 104 Wn.2d 662, 671, 709
P.2d 774 (1985). A sophisticated party such as the Port should have
clearly understood that it falls within the definition of “employer” under
WISHA. RCW 49.17.020(4) (“any person … which engages in any
business, industry, profession, or activity in this state and employs one or
more employees or who contracts with one or more persons, the essence
of which is the personal labor of such person or persons and includes the
state, counties, cities, and all municipal corporations, public corporations,
4
political subdivisions of the state …”). Nonetheless, during the appeal
that led to this Courts decision in Afoa v. Port of Seattle, 176 Wn.2d 460,
470, 296 P.3d 800 (2013) (“Afoa I”), the Port claimed this did not apply
to it. That position was totally and clearly rejected by Afoa I, which held
that “[w]e reject the Port’s argument, which is inconsistent with our
holdings in Goucher and Stute,” and “[w]e reaffirm Goucher and Stute
and hold that WISHA’s specific duty does not require a direct
employment relationship.” 176 Wn.2d at 473. Yet despite all this, at the
2015 trial the Port testified that it was still only staffing and directing its
Sea-Tac Airport WISHA compliance office to ensure that WISHA is
followed for its own direct employees, RP 1086/3-6, RP 3071/11-13, and
it admitted this in its Appellate Briefing below. See, Brief of Appellant
Port at 22 (“the Port department responsible for WISHA compliance and
health and safety had a three-member staff whose job was to ensure the
Port and its employees, not other employers and their employees, were in
compliance”) (emphasis in original); accord, id. at 25-26.
This is a serious concern to WSLC and its members. There are
16-18,000 workers at Sea-Tac Airport who are not employed directly by
the Port, but who are supposed to be protected by the Port’s WISHA
Specific Duty, yet the Port has only allocated three employees to do this
crucial job. Of course, by its contracts the Port retains complete authority
5
to monitor safety at the airport, and it does staff a ramp control tower, the
Port Ramp Patrol, the Port Police, and the Port Fire Department, all of
whom combine to in fact control all aspects of job performance by
everybody on the ramp portion of the airfield. But at the same time, the
Port is blatantly shirking its legal duty to ensure that all employees at
Sea-Tac Airport have a WISHA-compliant safe workplace. The Port
refuses to face the fact (now found by the jury) that it is the party best
able to ensure worker safety at the airport, and that therefore the law
requires it to do so across the board, for all airport workers, direct and
indirect.
WSLC urges this Court to make it absolutely clear that the Port
cannot evade its responsibility any longer. Allowing the Port to pass off
to another party even one dollar of the verdict in this case sends the
message that a nondelegable duty is delegable and that the WISHA
Specific Duty doesn’t mean what this Court has repeatedly held that it
does mean.
III. ISSUE PRESENTED
Was the nondelegable WISHA specific duty under RCW
49.17.060(2), and the nondelegable common-law duty of a control party
to provide a safe workplace, abrogated by RCW 4.22.070(1)?
6
IV. ARGUMENT
A. Traditional Respondeat Superior Vicarious Liability Survives
Tort Reform
The Port argues that the plain language of RCW 4.22.070(1)
means that the trial court had to allocate fault to all entities that may have
caused plaintiff’s damages. But in making this argument, the Port glosses
over the very important exception written directly into RCW 4.22.070(1)
by the Legislature for the protection of the working men and women of
Washington: “The liability of each defendant shall be several only and
shall not be joint except: (a) A party shall be responsible for the fault of
another person or for payment of the proportionate share of another party
… where a person was acting as an agent or servant of the party.” RCW
4.22.070(1)(a). This language clearly recognizes that the longstanding
rule of respondeat superior applicable to a “master” for the conduct of its
“servants” was not intended to be abrogated by Tort Reform. The
vicarious liability of the master was expressly maintained as an exception
to the usual rule of several liability, and therefore as an instance of joint
and several liability that survived Tort Reform. RCW 4.22.030 (“Except
as otherwise provided in RCW 4.22.070, if more than one person is liable
to a claimant on an indivisible claim for the same injury, death or harm,
the liability of such persons shall be joint and several.”).
7
Applied to the context of WISHA, the Port is the statutory
employer. Afoa I, 176 Wn.2d at 473. Applied to the context of both
common-law and WISHA control liability, the Port is in the position of
the “master” because it is the party best able to control safety at the
multiemployer job site. Id. at 473, 477, 478, 479, 481. The fact that it
works both through direct employee agents and other kinds of agents –
airlines, ground service contractors, and their employees – does not
change the reality of the relationship. Id. at 477-78. Under the
nondelegable duty doctrine, the Port has vicarious liability for the actions
of its agents and servants that is identical to the vicarious liability that the
Legislature expressly excluded from the general rule of several liability in
RCW 4.22.070(1)(a).
B. The “Buck” For Safety Has To Stop With The Party Best
Able To Protect Worker Safety At The Multiemployer Job
Site
A recent study by Dr. Emile Tompa, published in June 2016 in the
American Journal of Industrial Medicine, concludes that “specific
deterrence from inspections with penalties” results in a decrease in
subsequent workplace injuries, whereas general deterrence (i.e., the
impact on actors from knowing that others have been penalized for
workplace violations) is not effective. Emile Tomba, et. al., A Systematic
Literature Review of the Effectiveness of Occupational Health and Safety
8
Regulatory Enforcement, American Journal of Industrial Medicine (Oct.
28, 2015), pp.10-11, 12 (appended to this brief for the Court’s
convenience. This means that safety will not improve at Sea-Tac Airport
unless and until the Port of Seattle is made to understand that the “buck”
for safety at Sea-Tac Airport stops with it.
The evidence in this case clearly shows that the Port is the “superauthoritative” body with power over all other actors at the airport, and
this accords with the experience of our members, who analogized the Port
in this case to “the Eye of Sauron” from The Lord of the Rings. RP 526/3-
21. With respect to the nonparty airline empty chair defendants, they all
operate under signed agreements in which the Port granted them a
nonexclusive right to use the airfield area “subject at all times to the
exclusive control and management by the Port.” Ex. 675 at Port 277
(China); Ex. 676 at Port 3465 (British), Ex. 677 at Port 3648 (Eva); Ex.
678 at Port 190 (Hawaiian), RP 1510/8-19. At the trial in this case,
Michael Ehl, the Port’s Director of Aviation Operations, admitted that the
Port was the one entity best able to keep Sea-Tac Airport safe. RP
3021/1-7. Menzies itself has asserted that many of the citations it was
issued by DLI, discussed earlier, related to matters with the control of the
9
Port, not it alone.1
The Tompa study referenced above means that SeaTac Airport will become more dangerous if the Port is allowed to pass off
its responsibility for ensuring a safe workplace at the airport to others.
Likewise, other airports and the many multiemployer jobsites (virtually
every construction site) across the state will become more dangerous as
responsibility for safety becomes more diffuse. As this case
demonstrates, that would have a real human cost to WSLC members and
their families.
This is not to say that, in the appropriate case, an injured Sea-Tac
Airport worker could not seek and recover third-party liability from an
airline or other employer operating at the airport. It is clearly the law that
more than one controlling party can be responsible for workplace injuries
at a multiemployer job site. E.g., Weinert v. Bronco Nat’l Co., 58 Wn.
App. 692, 795 P.2d 1167 (1990); George Sollitt Corp. v. Howard
Chapman Plumbing & Heating, Inc., 67 Wn. App. 468, 836 P.2d 851
(1992). But concurrent liability is not inconsistent with nondelegable
liability. All it means is that, for the initial liability to the injured worker,
each controlling party is fully charged with a nondelegable duty to
1
On March 7, 2016, after receiving notice of the citations referenced above, Menzies
Aviation sent a statement that said, in part, “Many of the citations relate to airport
infrastructure issues. Fully mitigating these issues would require a massive
reconfiguration of the airport itself, and changes to baggage systems and ground
10
provide a safe workplace. Then, if appropriate under the contracts
between those controlling parties, they can sue to allocate fault among
themselves. See, Gilbert H. Moen Co. v. Island Steel Erectors, Inc., 128
Wn.2d 745, 758, 912 P.2d 472 (1996).
C. Injured Workers Should Be Spared The Burden Of Suing
Everybody
The injured worker should not be forced to sue everyone at the
multiemployer job site in order to ensure that he or she receives proper
compensation. That would be a terrible waste of judicial resources, and
tends to overwhelm the practical ability of the injured worker to assert his
or her third-party claim for full and fair compensation. The nondelegable
duty to provide a safe workplace means that an injured worker can pick
one or two prominent defendants at a multiemployer job site such as the
airport, and be assured of recovering full and fair compensation.
The evidence in this case is that there are some 200 independent
contractors operating at Sea-Tac Airport, including about 34 air carriers.
Brief of Appellant Port at 5. A seriously injured employee should not be
saddled with the burden and high cost of investigating exactly which of
these many entities might arguably have had some control over the
manner of work involved in his or her injury. The folly of the Port’s
handling equipment used not just at Sea-Tac, but throughout the U.S. aviation industry.”
“Alaska Airlines Cited For Unsafe Working Conditions,” KIRO 7 NEWS, supra.
11
position is demonstrated in this case, in which the airlines and Port
witnesses steadfastly denied in sworn statements that the airlines had any
involvement, and the airlines were so convincing that they persuaded
Judge Coughenour to grant them summary judgment in Federal Court.
How then can injured workers ever determine who to sue, if they do not
simply sue every single entity out of an abundance of caution? If the
Port’s position succeeds, WSLC and its union affiliates will be forced to
advise any employee injured at the airport to sue every airline and every
other employer operating on the airfield. The costs, both to injured
workers and to the judicial system itself, would be catastrophic.
D. The Port’s Arguments Fit Within A Discredited Historical
Pattern Of Employers Seeking To Pass Off Responsibility For
Industrial Accidents To Others
WSLC also wishes to remind the Court that the current dispute
fits within a historical context in which employers have, since the 19th
century, attempted to place blame for industrial accidents onto others.
Long ago, in Farwell v. Boston & Worcester Rail Road, 45 Mass. 49
(1842), Chief Justice Lemuel Shaw of the Massachusetts Supreme Court
laid down the seminal American case for the notorious “fellow-servant”
rule, which shielded employers from liability for workplace injury
“caused” by the carelessness of other employees, and was thus an
12
exception to the usual rule of respondeat superior. This rule led to untold
suffering and the creation of workers compensation statutes.
The long line of Washington cases from 1896 to 2013 cited by
Mr. Afoa in favor of a “nondelegable duty” to provide a safe workplace,
see, Supplemental Brief of Afoa, pp.4-5, fns. 10-12, constitute this Court’s
renunciation of this outdated rule. These cases show this Court’s
consistent view: (1) that sound public policy requires that the party best
able to control safety at the workplace should bear full liability for failure
to do so, and (2) that it will read all statutes consistent with the
Washington Constitutional mandate that the legislature “‘pass necessary
laws for the protection of persons working in mines, factories and other
employments dangerous to life or deleterious to health.’” WA Const. Art.
II §35 (quoted in Afoa I, 176 Wn.2d at 470).
The Port’s argument that RCW 4.22.070(1) allows it to pass
liability for injury to Sea-Tac Airport workers onto other entities who
have only partial or limited control over worker safety is no different
from the old arguments in favor of passing liability to fellow servants.
We have come too far to go back now to the Gilded Age when workers
were just disposable cogs in the machinery of industry.
//
//
13
V. CONCLUSION
On behalf of hundreds of thousands of working men and women
in Washington State, the WSLC urges this Court to affirm the decision of
the Court of Appeals in this case, and to find that Tort Reform does not
abrogate the Port’s nondelegable duty and vicarious liability for ensuring
a safe workplace for all employees at Sea-Tac Airport.
Respectfully submitted this 4th day of December, 2017.
Dmitri Iglitzin, WSBA No. 17673
General Counsel
Washington State Labor Council
Schwerin Campbell Barnard Iglitzin & Lavitt, LLP
18 W Mercer St, Suite 400
Seattle, WA 98119
(206) 257-6003
Iglitzin@workerlaw.com
14
DECLARATION OF SERVICE
I, Jennifer Woodward, declare under penalty of perjury under the
laws of the state of Washington, that on December 4, 2017, I caused the
foregoing Amicus Brief of Washington State Labor Council to be filed
electronically with the court using the appellate court portal, and a true
and correct copy of the same to be sent via email service to:
Pamela A. Okano
pokano@rmlaw.com
Reed McClure
1215 Fourth Avenue, Suite 1700
Seattle, WA 98161
Mark S. Northcraft
mark_northcraft@northcraft.com
Andrew T. Biggs
andrew_biggs@northcraft.com
Northcraft, Bigby & Biggs, PC
819 Virginia St., Suite C-2
Seattle, WA 98101
Charles A. Bird
Charles.bird@dentons.com
Dentons US LLP
4655 Executive Drive, Suite 700
San Diego, CA 92121
Raymond E.S. Bishop
ray@bishoplegal.com
Derek K. Moore
derek@bishoplegal.com
Bishop Legal
19743 First Avenue South
Normandy Park, WA 98148
Mark A. Dombroff
mark.dombroff@dentons.com
Dentons US LLP
1676 International Drive
Penthouse
McLean, VA 22101
Dated this 4th day of December, 2017, at Seattle, Washington.
Jennifer Woodward, Paralegal
Appendix
A Systematic Literature Review of the
Effectiveness of Occupational Health and Safety
Regulatory Enforcement
Emile Tompa, PhD,
1,2,3 Christina Kalcevich, MA,
1 Michael Foley, MA,
4 Chris McLeod, PhD,
1,5
Sheilah Hogg-Johnson, PhD,
1,3 Kim Cullen, PhD,
1 Ellen MacEachen, PhD,
3,6
Quenby Mahood, MA,
1 and Emma Irvin, BA1
Background We aimed to determine the strength of evidence on the effectiveness of
legislative and regulatory policy levers in creating incentives for organizations to improve
occupational health and safety processes and outcomes.
Methods A systematic review was undertaken to assess the strength of evidence on the
effectiveness of specific policy levers using a “best-evidence” synthesis approach.
Results A structured literature search identified 11,947 citations from 13 peer-reviewed
literature databases. Forty-three studies were retained for synthesis. Strong evidence was
identified for three out of nine clusters.
Conclusions There is strong evidence that several OHS policy levers are effective in
terms of reducing injuries and/or increasing compliance with legislation. This study adds
to the evidence on OHS regulatory effectiveness from an earlier review. In addition to new
evidence supporting previous study findings, it included new categories of evidence–
compliance as an outcome, nature of enforcement, awareness campaigns, and smoke-free
workplace legislation. Am. J. Ind. Med. 2016 Wiley Periodicals, Inc.
KEY WORDS: regulation; legislation; occupational health and safety; OHS;
regulatory effectiveness
INTRODUCTION
Occupational health and safety (OHS) regulation
takes different forms across jurisdictions and over time.
Responding to involved stakeholders, government
authorities strive to devise ways to protect the health and
safety of workers that will be effective in the context of
competitive business environments, contemporary labor
market structures, available resources, labor-management
power issues, perspectives of health and safety professionals, and political will. OHS policy levers (i.e., the
specific means used to promote compliance)1 used by
regulatory authorities include a variety of approaches such
as administrative monetary penalties, prosecutions, orders
to comply, injunctions, inspections and audits, and
consultations. For regulations to be effective, it is critical
that they address key health and safety risks that are
amendable by workplace parties, are clearly communicated
to organizations, are enforceable by regulators, and create
1
Institute for Work and Health, Toronto, Ontario, Canada
2
Department of Economics, McMaster University, Hamilton, Ontario, Canada
3
Dalla Lana School of Public Health, University of Toronto, Toronto, Ontario, Canada
4
Safety and Health Assessment and Research Prevention Program, Washington
State Department of Labor and Industries, Tumwater, Washington 5
School of Population and Public Health, Faculty of Medicine, University of British
Columbia, Vancouver, British Columbia, Canada 6
School of Public Health and Health Systems, University of Waterloo, Waterloo,
Ontario, Canada Correspondence to: EmileTompa, PhD, Institute for Work and Health, 481University
Avenue, Suite 800, Toronto, Ontario, Canada M5G 2E9. E-mail: etompa@iwh.on.ca
Accepted 23 April 2016
DOI 10.1002/ajim.22605. Published online in Wiley Online Library
(wileyonlinelibrary.com).
1 We use the term “policy lever” to refer to the specific means by which a
regulator attempts to encourage action in a particular direction, as opposed
the broader notion of “policy” as the operationalization of legislation.
AMERICAN JOURNAL OF INDUSTRIAL MEDICINE
2016 Wiley Periodicals,Inc.
incentives for compliance [Mendeloff, 1979; Scholz and
Gray, 1997; Shapiro and Rabinowitz, 1997; Baggs et al.,
2003; Wright and Genna, 2005; Bluff, 2011; Safe Work
Australia, 2013].
The literature on OHS regulatory policy levers is large
and diverse, uses different statistical methods and levels of
data aggregation, and considers experiences from various
time periods and jurisdictions. As a result, it is difficult to
compare and contrast findings from different studies,
discern the quality of evidence, and identify the overarching strength of evidence on particular levers. Nonetheless,
collating and synthesizing the evidence on the effectiveness of OHS regulatory policy levers is critical, given the
substantial resources invested by the public sectors in
regulatory enforcement and by organizations seeking to be
compliant.
While earlier studies reviewed parts of this diverse
literature [e.g., Kralj, 2001; Mendeloff, 2001], Tompa et al.
[2007] was the first to use a structured approach to
identifying, evaluating, and synthesizing the evidence
base. More recent reviews have complemented these
evidence syntheses by considering the literature on the
socio-psychological factors of stakeholders that bear on their
ability to address OHS issues [Bluff, 2011], and others have
focused on why some regulatory efforts are successful while
others are not [Safe Work Australia, 2013].
The Tompa et al. [2007] review found strong evidence
that the first hand experience of citations and penalties
(known as specific deterrence) reduces injuries. In contrast,
the first hand experience of inspections had only limited to
mixed evidence. Similarly, there was limited to mixed
evidence that the probability of inspections, citations, and
penalties (known as general deterrence) reduces injuries. The
review considered evidence up until 2004, but the literature
has grown substantially since then, with investigations of
new legislation and more detailed inquiries into existing
practices. The current systematic review follows from the
earlier review, expanding the scope to include studies that
consider intermediate outcomes, specifically compliance, as
well as other OHS policy levers such as consultations and
awareness campaigns. Also included is the introduction of
smoke-free workplace legislation.
The overarching question guiding this review is “what is
the strength of evidence on the effectiveness of OHS policy
levers in creating incentives for organizations to improve
occupational health and safety processes and outcomes.” We
follow with a detailed description of the systematic search
strategy, study inclusion criteria, quality assessment, and
evidence synthesis approach. The results provide evidence
synthesis profiles across nine clusters of studies that were
retained in the final review. Our discussion section elaborates
on the policy implications of our findings, expounds on the
importance of context, details the strength and limitations of
our review, and provides suggestions for the way forward for
research. We end with a brief summary of findings and
implications in our conclusion.
In addition to the research question noted above, the
review had the following objectives:
To identify peer-reviewed literature on the effectiveness
of OHS policy levers;
To evaluate the quality of identified studies and
synthesize the evidence;
To engage a stakeholder committee throughout the
process to assist with identifying the research questions,
scope of the study as well as interpretation of findings;
and
To disseminate the review findings locally, nationally,
and internationally.
METHODS
Stakeholder Engagement
Consistent with stakeholder engagement recommendations [Keown et al., 2008], an advisory committee was
formed to provide feedback on the key question guiding the
review, the scope of the literature search, the interpretation of
the findings, and the formulation of policy implications. The
committee consisted of three senior policy makers with
extensive regulatory enforcement experience from the
Ontario Ministry of Labour (Canada), three senior academics
with a specialty in OHS issues (from the United States,
United Kingdom, and Australia), two senior industry OHS
service providers and an injured workers’ advocate (all three
from Canada). The first advisory committee meeting was
held in the early stages of the study after some preliminary
groundwork on searches had been completed. A second one
was held near the end of the study after preliminary synthesis
profiles had been formulated.
Systematic Literature Search
This review, which focused on quantitative studies, was
undertaken in conjunction with a qualitative review on the
same topic. The quantitative review considered evidence on
effectiveness, while the qualitative review considered
planning and implementation of regulations. The two
reviews had a common search process, but once full studies
were identified as meeting preliminary inclusion criteria, the
two reviews were completed independently.
The review was based on a systematic search of several
peer-reviewed journal databases, specifically MEDLINE,
EMBASE, PsychINFO, ABI Inform, Health and Safety
Science Abstracts, ASSIA, EconLit, Sociological Abstracts,
Wilson Social Science Abstracts, and Index to Legal
2 Tompa et al.
Periodicals. Databases were chosen to capture all disciplinary areas that might have studies meeting the inclusion
criteria. The search methodology followed a modified PICO
(population, intervention, comparison, and outcome) format,
in which studies had to contain at least one term in each of
four categories (regulatory focus, setting, policy lever, and
context) in order to be retrieved. The search strategy
combined sets of keywords using an “AND” term between
categories, and an “OR” term within categories so that
citations would have to include at least one term from each of
the categories in order to be pulled from the database. Wildcard characters were used extensively to ensure different
spelling and forms of words were captured. Table SI in the
supplemental materials provides details on the final keywords used.
A hand search was also done on the journal “Policy and
Practice in Health and Safety” and on the website SafeWork
Australia/RegNet because of their focus on research related
to OHS regulatory mechanisms. As well, the research team
compiled a list of 19 content experts from seven countries
and solicited their suggestions of studies for consideration
that were already published in peer-reviewed journals, in
press, or accepted for review.
Searching for additional studies was an iterative process.
For example, all references of studies selected for inclusion
in the review were scanned to identify incremental relevant
studies. Other literature review studies on the topic of OHS
regulation were also scanned. This latter category included a
review by Bluff [2011] and a Cochrane collaboration review
by Mischke et al. [2013].
Selection of Studies for Inclusion
To be eligible for inclusion in the review, studies had
to be in English, published between January 1990 and
June 2013 in a peer-reviewed journal, and be longer than two
pages. The latter was to filter out short discussion pieces.
At the title and abstract screening stage there were two
criteria for study inclusion. First, studies had to consider
directives related to OHS legislation and/or regulation made
by a government authority. Second, studies had to evaluate
OHS legislation and/or regulations using quantitative and/or
qualitative methods. Studies that met the two criteria were
then classified as quantitative, qualitative, or mixed methods.
The title and abstract screening stage began with a
pilot test in which the entire research team reviewed the
same set of 120 studies based on the above noted criteria.
After all reviewers tested the criteria, the team met to
discuss discrepancies and fine tune the technical guidelines
document accordingly. A second meeting was held with the
research team after alternating pairs of two reviewers
assessed another 1,500 titles and abstracts to further discuss
any outstanding issues. Following this piloting, each
reviewer was assigned a separate batch of titles and
abstracts. A second reviewer audited 20% of citations
across the entire frame of studies pulled by the electronic
searches to ensure accuracy of the selection process.
Agreement for passing citations onto the next stage was
99.5%. In cases where only a title was available for review,
the entire paper was retrieved and reviewed before deciding
on its eligibility for inclusion.
The full study screening stage used the same criteria for
inclusion as the title and abstract stage. The difference here
was that the full article was reviewed to ensure it met
the criteria. At this stage, studies were assigned to a single
reviewer. Again, 20% of the full article screenings were
subjected to a second review. Agreement was 96% at this
stage for inclusion. All studies selected for inclusion were
again screened by both the project coordinator and the
principle investigator as part of a quality check.
Studies included in the quantitative and mixed
methods categories were reviewed by multiple quantitative team members to identify those that met the following
incremental inclusion criteria: (i) the study had a temporal
element (i.e., study must either use data from multiple
points in time, or ask respondents about past experiences);
(ii) the study design was rigorous (i.e., study could not be
just descriptive, it had to use multiple regression modeling
methods or had to have a quasi-experimental design,
including before/after or a concurrent control group); and
(iii) the study considered final outcomes, such as injuries
and illnesses, or intermediate outcomes, such as compliance or reduced exposures (studies examining only
monetary outcomes were not included).2 Compliance
and reduced exposures are seen as intermediate outcomes
since the ultimate goal of OHS regulatory enforcement
is to reduce work injuries and illnesses. Essentially,
compliance and reduced exposures are simply a means to
that goal.
Relevant regulatory policy levers included regulation
enacted and enforced at any level of government: country,
state/province, sector, workplace, and/or individual level;
and regulatory levers that focused on enforcement (e.g., stop
work orders, injunctions, prosecutions, monetary penalties,
warnings, orders, tickets, inspections), voluntary activities
(e.g., voluntary guidelines, consultations, certifications,
health, and safety group membership) and/or mandated
activities (e.g. right to refuse unsafe work, requirement for a
joint health, and safety committee). Table I provides an
overview of the policy levers and outcomes considered in the
review.
2 Monetary outcomes are used in studies focusing on insurance costs. We
excluded these, as we were interested in studies focusing on occupational
health and safety performance rather than insurance costs. We note that
there were only a few such studies.
Review of OHS Regulatory Enforcement Version: October 28, 2015 3
Quality Assessment and Data Extraction
Quality assessment and data extraction were performed
concurrently by two reviewers. The two reviewers independently scored each assigned study and then met to discuss it.
A consensus rating was not required. Rather, the discussion
was meant to ensure that both reviewers considered the full
range of issues relevant to each study. Studies were evaluated
based on a quality appraisal protocol developed by Tompa
et al. [2007] that consisted of 10 items in two parts (study
quality and policy lever relevance). Each item was ranked on
a Likert scale from one to five. See Table II for details of the
10 items. Ratings from the two reviewers were averaged for
part one and part two separately. The lower of the two scores
was used for the overall quality rating score. The final quality
rating for a study was grouped into one of three categories:
high (70% or greater), medium (50–70%), or low (50% or
less). Only high and medium quality studies were retained for
evidence synthesis.
Evidence Synthesis
The evidence-ranking algorithm used to synthesize
evidence across studies was based on a qualitative methods
approach known as “best evidence synthesis” developed by
Slavin [1986, 1995] and used in other published reviews
[e.g., Tompa et al., 2007; Rivilis et al., 2008; Tullar et al.,
2010]. Best-evidence synthesis identifies the strength of a
relationship based on the quantity, quality, and consistency
of the evidence available to support a relationship between
variables. Part and parcel to the approach is the notion of
precedence. If a certain quality standard was required in the
past, then current requirements should be the same or higher.
Thus, as the literature grows and advances, the bar for each
quality level may be set higher. The best evidence synthesis
approach is well suited for the subject matter and literature of
this review because of the broad range of study designs and
analytic approaches. Quantitative methods such as metaanalysis cannot be employed when statistical methods used
by different studies are too varied. Best evidence synthesis
aims to provide the same methodological rigor to evidence
synthesis as meta analysis by clearly and concisely
articulating the synthesis criteria.
For each policy lever and outcome category, we ranked
the evidence supporting the hypothesized relationship on a
five-level scale consisting of strong evidence, moderate
evidence, limited evidence, no evidence, and mixed
evidence.3 Evidence on a policy lever was tested against
the criteria for the highest level (strong evidence), and, if it
was not met, the criteria for the next highest level (moderate
evidence) was considered. If it was not met, the subsequent
level (limited evidence) was considered. If the evidence did
not meet the criteria for any of these three levels, it defaulted
to one of the two categories, no evidence or mixed evidence.
The former arose if there were no studies or only low-quality
studies. The latter arose if there was more than one high- or
medium-quality study and the studies provided conflicting
evidence. Table III below provides details on the evidence
synthesis algorithm.
RESULTS
Literature Search Results
The literature search, which included electronic databases, hand searches, and references from content experts,
identified 11,947 unique titles and abstracts across 13
sources. Table IV below provides details by source. The cell
counts are prior to the removal of duplicates from across the
different sources.
Of the 11,947 titles and abstracts, 2,360 passed to full
study review. Of these studies, 282 were retained in the
quantitative or mixed method categories. At this stage the
incremental quantitative rigor criteria were invoked to screen
the 282 studies, 61 of which passed the screening and moved
onto the quality assessment stage. Three additional articles
were identified in the reference lists of these studies,
increasing the count to 64 that were assessed for quality. Of
these studies, 43 were rated high or medium quality and were
retained for evidence synthesis. Figure 1 below provides a
flow chart of the number of studies retained at each stage.
TABLE I. SummaryTable of Policy Levers and Outcomes
Policy levers Outcomes
Introduction of OHS legislation Compliance
Introduction of smoke-free workplace
legislation
Exposures
Inspection sequence Awareness (of compaign)
Inspection activity: general deterrence of
inspections and penalties
Health (respiratory and
sensory symptoms)
Inspection activity: specific deterrence of
inspections and penalties
Health behaviours (cigarette
smoking)
Nature of enforcement: consultative activities Injuries and fatalities
Nature of enforcement: autonomy supportive
inspector style
Truck crashes
Nature of enforcement: state- versus federallevel enforcement
Awareness campaigns
3 A significance level of 5% was used as the cutoff for evidence of a
relationship between a policy lever and an outcome. Though some studies
included considered 10% as significant, we treated these as not significant.
4 Tompa et al.
The Tompa et al. [2007] review had identified 24 studies
on the effectiveness of regulatory policy levers published
from 1970 to 2004. Sixteen of those studies were published
from 1990 onward, though four were not from peer reviewed
journal publications and one study was not in English. The
remaining 11 studies from that review were identified in our
search and had passed through the same quality appraisal
protocol as the newly identified studies. Of the 11 studies,
seven dropped in quality ranking from high to medium or
from medium to low quality, due to a higher standard
imposed by the team in response to a noted higher level of
quality identified in the overall literature. This is consistent
with the best-evidence synthesis approach, which takes into
consideration precedence and the state of the literature.
Ultimately, seven of the original studies received a ranking of
medium or high quality and were included in this review.
Included studies were grouped into nine thematic
clusters, defined by the policy lever being evaluated. The
clusters were: (i) introduction of OHS legislation; (ii)
introduction of smoke-free workplace legislation; (iii)
inspection sequence (defined below); (iv) inspection activity:
general deterrence of inspections and penalties, (v) inspection activity: specific deterrence of inspections with/without
penalties; (vi) nature of enforcement: consultative activity;
(vii) nature of enforcement: autonomy supportive inspection
style, (viii) nature of enforcement: state- versus federal-level
enforcement; and (ix) awareness campaigns. See Table SII in
the supplemental material for details. Table V provides a
high level summary of the studies by cluster and the synthesis
statements related to each.
Evidence Synthesis Results
Introduction of OHS legislation
There are nine studies in this cluster (one of high quality
and eight of medium quality). Studies considered the
introduction of a mix of different legislation, some enabling
legislation to promote good practices and empower
workplace parties, and others regulations as mechanisms
for creating compliance obligations. Specifically, the
legislation includes a hearing conservation program, chemical exposure mitigation, universal precautions for blood
borne pathogens, ergonomics regulation, lockout/tagout
requirements, internal responsibility systems, and training
requirements. Some studies in this cluster considered final
outcomes of injury, illness, and fatality rates, while others
considered intermediate outcomes of exposure and compliance rates. For the former, there is “moderate evidence” that
the introduction of OHS legislation has an effect on final
outcomes (based on one high quality study and five medium
quality studies). For the latter, there is “limited evidence”
that the introduction of legislation improves intermediate
outcomes, that is, reduces exposure rates and/or increases
compliance rates (based on three medium quality studies).
Four of the studies in this cluster were in manufacturing, two
in health care, one in forestry, and one in multiple sectors. Six
of the studies were undertaken in the United States, two in
Canada, and one in Spain.
Introduction of smoke-free workplace
legislation
There are six studies in this cluster (five of high quality
and one of medium quality). Studies all considered the
introduction of different forms of smoke-free workplace
legislation in North America and Europe. Here too some
studies considered final outcomes, specifically respiratory
and sensory symptoms. Others considered intermediate
outcomes, specifically reductions in smoke exposure, and
reductions in cigarette consumption. For final outcomes,
there is “moderate evidence” that smoke-free workplace
legislation reduces respiratory and/or sensory symptoms
(based on two high quality and two medium quality studies).
TABLE II. QualityAssessmentTool
Overall study quality
1. Does the study specify a theoretically correct relationship between the policy feature (explanatory variable), and the outcome variable (dependent variable)?
2. Are the characteristics of the study population properly well-defined, measured and described?
3.Was the statistical methodology appropriate for the research question and study design?
4. Does the study establish an empirically correct relationship between the outcome and independent variables?
5.Was there adjustment made for important covariates?
6. Are the results interpreted correctly?
Policy lever relevance
7. How strongly would you rate the measurement validity of this study?
8. How strongly would you rate the statistical validity of this study?
9. How strongly would you rate the internal validity of this study?
10. How strongly would you rate the external validity of this study?
Review of OHS Regulatory Enforcement Version: October 28, 2015 5
Four studies considered respiratory symptoms as an outcome
and three sensory symptoms. For intermediate outcomes,
there is “strong evidence” that smoke-free workplace
legislation reduces smoke exposure and/or cigarette consumption (based on four high quality and one medium
quality studies).
Four of the included studies on smoke-free workplace
legislation examined the impact of national laws in Europe.
Ayres et al. [2009] examined the health changes before and
after smoke-free workplace legislation was passed in
Scotland in 2006. Allwright et al. [2005] examined the
health changes in bar workers resulting from smoke-free
workplace legislation in the Republic of Ireland in 2004 and
compared them to changes in workers in Northern Ireland
(which at the time did not have smoke-free workplace
legislation). Larsson et al. [2008] examined the health effects
of a smoke-free workplace legislation, enacted in 2005, on
bar, restaurant and gaming workers in Sweden. The fourth
European study examined the impact of a Spanish federal
smoke-free workplace legislation that exempted hospitality
venues from following the ban. Firms were given the choice
to choose a smoke-free policy, a partial smoking restriction,
or have no restrictions at all. The authors compared exposure
and health effects following the ban with those in hospitality
workers in Portugal and Andorra, which had no smoke-free
workplace legislation.
Three of the studies in this cluster were undertaken in
North America. One study, that of Bondy et al. [2009],
examined the impact on bar workers of a municipal smokefree workplace bylaw in Toronto, Canada in 2004. The
authors compared secondhand smoke exposure of bar
workers in Toronto to the exposure of workers in Windsor,
Canada, a nearby city without smoke-free workplace
TABLE III. Evidence Synthesis Algorithm
Strong evidence
Minimum study quality: high.
Minimum number of studies: three.
Consistency criteria: if there are only three high-quality studies, all of them must report consistent findings. If there are four or more high-quality findings, all of
them mustreport consistentresults unlessthere is a specific methodological reasonthat could explain a divergentresult.Themajority (>50%) ofmedium-quality
studies must concur with the findings from the high-quality studies.
If the above criteria are not met, then the criteria for establishing moderate evidence are applied.
Moderate evidence
Minimum study quality: medium or less than three high-quality studies.
Minimum number of studies: three; they can be a mixture of medium- or high-quality studies.
Consistency criteria: at least three studies must report consistent findings, and the majority (>2/3) of all the studies must report consistent findings.
If the above criteria are not met, then the criteria for establishing limited evidence are applied.
Limited evidence
Minimum study quality: medium.
Minimum number of studies: one.
Consistency criteria: fewer than three studies report consistent findings, with the majority (>50%) of the studies reporting consistent findings.
If the above criteria are not met, then there is no evidence or mixed evidence.
No evidence
No high- or medium-quality studies are available from which to draw conclusions.
Mixed evidence
The findings from medium- and high-quality studies are contradictory.
TABLE IV. Titles and Abstracts Identified by Source
Source N Source N
Medline 3,450 Sociological Abstracts 195
EMBASE 4,190 Wilson Social Science Abstracts 184
PsycINFO 733 Index to Legal Periodicals 149
ABI Inform 4,000 Hand-search: Policy and Practice in
Health and Safety
19
Health and Safety
Science Abstracts
1,181 Hand-search: SafeWork Australia/
RegNet
35
ASSIA 85 Content experts 19
EconLit 279
6 Tompa et al.
legislation. The final smoke-free workplace legislation
study, that of Moskowitz et al. [2000], considered legislative
changes in California. It differs from the other studies in that
it looked at the impact of local ordinances on smoking
cessation rates and workplace smoking policies.
Inspection sequence
There were four studies in this cluster, all of which were
undertaken in US jurisdictions. The studies considered how
inspection sequence influences compliance rates based on
changes in compliance violations cited. For this cluster, there
is “moderate evidence” that the first inspection has the largest
impact on compliance rates for all violations, with
subsequent inspections having a declining impact (based
on two high quality and two medium quality studies). All
four studies had similar findings for all and for serious
compliance violations. Ko et al. [2010] also considered four
different time periods within 1972–2006 range and found
similar results across the periods. As all studies used micro
level data on the plant/site, this relationship would be
considered specific deterrence.
Inspection activity: General deterrence
of inspections and penalties
This cluster considers the impact of the probability of
inspections through aggregate/industry levels inspection
activity. There are three studies in this cluster, all of medium
quality. Studies considered the final outcomes of lost-time
injury rate, lost workdays, and the fatality rate. Based on this
cluster, there is “limited evidence” of no general deterrence
effect on lost-time injuries at the aggregate level (based on
three studies—two studies found no effect and one study
found an effect). There is “limited evidence” of a general
deterrence on fatalities and lost workdays (based on one
study for each outcome). The three studies were from North
American jurisdictions; two from the US [Scholz and Gray,
1990; Ruser and Smith, 1991], and one from Alberta, Canada
[Auld et al., 2001]. One study used aggregated data [Auld
et al., 2001], and two used micro data at the firm level [Scholz
and Gray, 1990; Ruser and Smith, 1991].
Inspection activity: Specific deterrence
of inspections with/without penalties
This cluster has the largest number of studies, with 13
studies. Most considered specific deterrence in the form of
inspections with/without penalties, while some also considered other types of specific enforcement activities such as
consultations or details of the inspection activity such as
programmed versus complaint inspections and the value of
fines imposed. One study focused on early versus late
inspections [Ruser and Smith, 1991], and another focused on
compliance reviews in the transportation sector [Chen,
2008]. All considered the effects of the policy lever on final
outcomes.
This cluster provides “strong evidence” that specific
deterrence from inspections with penalties reduces final
outcomes (based on nine studies, six of which were high
quality, and three of medium quality). Outcomes considered in the studies include all injuries, health care only
injuries, lost-time injuries, workdays lost, musculoskeletal
disorders (MSD) and non-MSD injuries, and restricted
activity days. All studies found a deterrence effect on most
final outcomes.
The cluster provides “moderate to limited evidence” of
no effect from specific deterrence of inspections without
penalties on final outcomes (based on nine studies, six of
which were high quality, and three of medium quality). A
range of outcomes was considered in these studies, including
all injuries, health care only injuries, lost-time injuries,
workdays lost, MSD and non-MSD injuries, and restricted
activity days. Some studies found deterrence effects [Foley
et al., 2012; Levine et al., 2012], while others found effects
only under specific conditions such as in fixed-site industries
FIGURE1. Flow chart of studies retained at each stage.
Review of OHS Regulatory Enforcement Version: October 28, 2015 7
TABLE V. Summary of Studies by Cluster With Synthesis Statements
Cluster No. of studies by outcome Study, jurisdiction, sector Evidence synthesis
Introduction of OHS
legislation
Final outcomes (six
studies): injuries and
fatality
Davies et al. [2008]: British Columbia, Canada;
forestry
Arocena and Nunez [2009]: Spain; manufacturing
Bulzacchelli et al. [2007]: United States;
manufacturing
Finger and Gamper-Rabindran [2013]:
United States; chemical manufacturing
Lewchuk et al. [1996]: Ontario,Canada,
manufacturing
Monforton and Windsor [2010]: United States;
mining
Moderate evidencethat the introduction of
OHS legislation has an effect on final
outcomes
Intermediate outcomes
(three studies): exposure
and compliance
Foley et al. [2009]: Washington State, United
States; multiple sectors
LaMontagne et al. [2004]: United States; health
care
Ramsey and Glenn [1996]: Tennessee;
United States, health care
Limited evidencethat the introduction of
legislation improves intermediate outcomes
Introduction of smokefree workplace legislation
Final outcomes (one
study): respiratory and
sensory symptoms
Ayres et al. [2009]: Scotland; bar/restaurant
Allwright et al. [2005]: Republic of Ireland;
bar/restaurant
Fernandez et al. [2009]: Spain; hospitality
Larsson et al. [2008]: Sweden; bar/restaurant
Moderate evidencethat smoke-free
workplace legislation improves final
outcomes
Intermediate outcomes
(two studies): smoke
exposure, cigarette
consumption
Allwright et al. [2005]: Republic of Ireland;
bar/restaurant
Bondy et al. [2009]: Ontario,Canada;
bar/restaurant
Fernandez et al. [2009]: Spain; hospitality
Larsson et al. [2008]: Sweden; bar/restaurant
Moskowitz et al. [2000]: California, United States;
multiple
Strong evidence that smoke-free workplace
legislation improves intermediate outcomes
Inspection sequence Intermediate outcomes
(four studies): compliance
Gray and Jones [1991b]: United States;
manufacturing
Weil [2001]: United States; manufacturing
Gray and Jones [1991b]: United States;
manufacturing
Ko et al. [2010]: United States, manufacturing
Moderate evidencethat the first inspection
results in the largest improvement in
compliance
Inspection activity:
general deterrence of
inspections and penalties
Final outcomes (three
studies): lost-time injuries
Auld et al. [2001]: Alberta,Canada, construction
Ruser and Smith [1991]: United States,
manufacturing
Scholz and Gray [1990]: United States,
manufacturing
Limited evidence (three studies) of no
general deterrence effect on lost-time
injuries
Limited evidence of a general deterrence
effect on fatalities (one study) and lost
workdays (one study)
(Continued )
8 Tompa et al.
TABLE V. (Continued )
Cluster No. of studies by outcome Study, jurisdiction, sector Evidence synthesis
Inspection activity:
specific deterrence of
inspections with/ without
penalties
Final outcomes (13
studies): injuries and truck
crashes
Foley et al. [2012]: Washington State,
United States; multiple sectors
Gray and Scholz [1991]: United States;
manufacturing
Gray and Scholz [1993]: United States;
manufacturing
Gray and Mendeloff [2005]: United States;
manufacturing
Haviland et al. [2010]:Pennsylvania,
United States; manufacturing
Haviland et al. [2012]:Pennsylvania,
United States; manufacturing
Levine et al. [2012]: California, United States;
high risk industries
Mendeloff and Wayne [2005]: United States,
manufacturing
Nelson et al. [1997]: Washington State,
United States; construction
Ruser and Smith [1991]: United States;
manufacturing
Scholz and Gray [1990]: United States;
manufacturing
Scholz and Gray [1997]: United States;
manufacturing
Chen [2008]: United States; trucking
Strong evidence (nine studies) that specific
deterrence from inspections with penalties
reduces final outcomes
Moderateto limited evidence(nine studies) of
no effect from specific deterrence of
inspections without penalties on final
outcomes
Limited evidence (one study) that specific
deterrence in a compliancereview ofmotor
safety performancereduces truck crashes
Nature of enforcement:
Consultative activities
Final outcomes (three
studies): injuries
Baggs et al. [2003]: Washington State,
United States; multiple sectors
Foley et al. [2012]: Washington State,
United States; multiple sectors
Hogg-Johnson et al. [2012]: Ontario, Canada;
manufacturing
Strong evidence/limited evidence that
consultative activity has no effect on final
outcomes
Nature of enforcement:
Autonomy supportive
inspection style
Intermediate outcomes
(one study): compliance
Burstyn et al. [2010]: Alberta, Canada; multiple
sectors
Limited evidence that an autonomysupportive inspector stylereduces visits to
achieve compliance
Nature of enforcement:
State- versus federal-level
enforcement
Final outcomes (two
studies): injuries and
fatalities
Bradbury [2006]: United States, multiple sectors
Morantz [2009]: United States, construction
Limited evidence that state (versus federal)
enforcement results in lower fatalities and
higher injuries
Awareness campaigns Final outcomes (one
study): injuries
Mancini et al. [2005]: Italy, metal workers
Gadomski et al. [2006]: NewYork State,
United States; agriculture (children)
Limited evidence that awareness campaigns
improve final outcomes
Intermediate outcomes
(two studies): awareness
and compliance
Gadomski et al. [2006]: NewYork State,
United States; agriculture (children)
Bjorkdahl et al. [2008]: Sweden; multiple sectors
Stokols et al. [2001]: California, United States,
multiple sectors
Moderate evidence that awareness
campaigns improve intermediate outcomes
Review of OHS Regulatory Enforcement Version: October 28, 2015 9
[Scholz and Gray, 1990], inspections initiated by a worker
[Scholz and Gray, 1997], and inspections that were not
superficial record checks [Gray and Scholz, 1991], or found
a smaller effect than with citations [Nelson et al., 1997]. This
inconsistency is the reason for the dual level of evidence.
Some studies in this cluster considered inspections without
identifying whether there were citations or penalties [Ruser
and Smith, 1991; Nelson et al., 1997; Levine et al., 2012].
One study is treated separately in that it focused on truck
crashes as an outcome in the transportation sector. This study
alone provides “limited evidence” of specific deterrence
from a compliance review of motor safety performance with
regard to reduced truck crashes.
Nature of enforcement: Consultative
activity
Three studies are in this cluster, all of which are rated
high quality. The three considered final outcomes. For this
cluster there is either “strong evidence or limited evidence”
that consultative activity has no effect on injury rates (based
on three high quality studies). The reason for the two-sided
synthesis profile is that one study in this group, that of Foley
et al. [2012], found mixed results in which one outcome was
significant and negative for fixed site locations (lost workday
for non-MSD claims) and several other outcomes were
significant and negative for non-fixed site locations. The
three high quality studies in this cluster included two based
on data from Washington State [Baggs et al., 2003; Foley
et al., 2012], and one Canadian study from Ontario [HoggJohnson et al., 2012].
Nature of enforcement: Autonomy
supportive inspection style
The one study in this cluster considered the intermediate
outcome of compliance. For this cluster there is “limited
evidence” that an autonomy-supportive style (e.g., one in
which an inspector provides a rationale and choices versus
deadlines and pressure) reduces the number of visits to
achieve compliance (based on one high quality study). The
one study in this cluster is based on data from Alberta
[Burstyn et al., 2010].
Nature of enforcement: State- versus
federal-level enforcement
Two US studies examined whether state enforcement
was more or less effective than federal level enforcement.
The premise of these studies was that different styles
of enforcement may be provided by different levels of
government. The two studies in this cluster are both of
medium quality and both considered final outcomes. For this
cluster there is “limited evidence” that state enforcement
results in lower fatality rates compared to federal enforcement (based on two medium quality studies). One of the
studies also considered injury rates and found a positive and
significant result, suggesting that state enforcement is
associated with higher injury rates compared to federal
enforcement.
Awareness campaigns
The studies included in this cluster are in different
sectors and focused on different OHS risks. There are four
studies in this cluster, two of which considered final outcome
and three which considered intermediate outcomes. For the
former group, there is “limited evidence” that awareness
campaigns reduce injuries (based on two medium quality
studies). For the latter group, there is “moderate evidence”
that awareness campaigns improve compliance (based on
three medium quality studies). Among the four studies, one
evaluated an eye injury campaign for metal workers in Italy
[Mancini et al., 2005], a second evaluated a noise awareness
campaign in Sweden [Bjorkdahl et al., 2008], a third
evaluated a child labor in agriculture campaign in New York
[Gadomski et al., 2006], and a fourth evaluated a train-thetrainer program in California [Stokols et al., 2001].
DISCUSSION
Our findings have important implications for both policy
and research. On the policy side, the finding that several
legislative and regulatory policy levers are effective in
reducing injuries and/or increasing compliance provides
evidence for supporting such activities. Specifically, among
nine clusters (some with sub-categories) we found strong
evidence in three clusters and moderate evidence in five. In
terms of generalizability, the introduction of OHS legislation
cluster spanned several sectors in the United States, Canada
and Spain, and so may be broadly applicable to other
developed countries in North America, Europe, and Australasia. The introduction of smoke-free workplace legislation
cluster also spanned several countries, and therefore may be
broadly applicable to developed countries, particularly in
the hospitality sector. Two clusters have studies exclusively
from the United States, and largely in manufacturing—
that of inspection sequence and specific deterrence of
inspections—and thus may be less generalizable to other
sectors and countries. The consultative activity cluster and
the awareness campaign one have two countries in each and
with studies undertaken in multiple sectors, suggesting they
may be generalizable to other developed countries.
The strong evidence of an effect from actual inspections
with penalties and moderate to limited evidence of no effect
10 Tompa et al.
from inspections without penalties reinforces the importance
of regulators being out in the field identifying and citing/
penalizing non-compliance. The limited evidence for a
general deterrence effect found in our review is consistent
with this interpretation. The literature review by Tompa et al.
[2007] had similar findings with regards to general and
specific deterrence and their impact on injury outcomes. Our
update with more recent studies [e.g., Gray and Mendeloff,
2005; Mendeloff and Wayne, 2005; Haviland et al., 2010;
Foley et al., 2012] adds to this evidence, and the addition of
studies with compliance as an outcome [Gray and Jones
1991a,b; Weil, 2001; Ko et al., 2010] provides incremental
support for this finding. Essentially, firms may not have the
capacity to digest information about inspection activities in
the field; they may only react when the adverse experience of
an inspection with citations/penalties is first hand.
Bluff [2011] refers to competing theory of firm behavior
to explain why general deterrence may not be effective. For it
to be effective, firms would need to be rational, long-run
optimizers, and knowledgeable about the probability and
the financial implications of being inspected, whereas in
reality, firms may have bounded rationality and have limited
capacity to process information. If this is the case, regulators
may need to heighten awareness in the field by actively
communicating the consequences of non-compliance, and
possibly make information about non-compliers easily
available to the general public. Focused awareness campaigns and inspection blitzes might also be a way to provide
acute awareness on a particular hazard.
Studies that considered compliance as an outcome
offer important insights. The moderate evidence that the
first inspection has the largest impact on compliance is
corroborated across all four studies included in the review
[Gray and Jones, 1991a,b; Weil, 2001; Ko et al., 2010] and
has important implications for the efficient use of inspectorate resources. If subsequent inspections to a site have
substantially lesser impacts, as the literature suggests, then
an intensive regime of multiple inspections to a site may
not be the best use of resources. Some jurisdictions have
attempted such intensive enforcement strategies.
In another cluster in this review, moderate evidence
was found that awareness campaigns increase compliance,
reinforcing the importance of communicating regulatory
obligations to stakeholders. What is not clear is the
relationship between compliance and final outcomes. The
limited evidence that awareness campaigns reduce injures
would suggest that the relationship is not definitive. That
finding is based on only two medium quality studies. Clearly,
more research is needed on the relationship between
intermediate and final outcomes. In fact, Bluff [2011]
emphasizes the importance of better understanding of
motivations, attitude, perceptions, and skills in order to
determine how particular strategies, mechanisms, and
approaches can best be used to achieve compliance and
ultimately better final outcomes. A recent review by Safe
Work Australia [2013] also attempts to address issue of how
and why interventions work.
The findings for consultative activity (strong or limited
evidence depending on context) provide some preliminary
insights relevant to the move towards voluntary guidelines
in some jurisdictions. Of three studies considering final
outcomes, all of which were high quality, only one study
by Foley et al. [2012] found significant effects in some
contexts. The study by Hogg-Johnson et al. [2012] did not
find an effect, but noted that not all firms received
consultative services as was originally planned in the
program, and many only received a “light touch.” The
findings in this cluster are quite consistent with the findings
that specific deterrence is much more effective than general
deterrence, and suggest that consultation in the absence of
specific deterrence might be interpreted by organizations as
that there are no consequence for non-compliance. Clearly,
more research is needed in this area to better understand
whether consultations, if implemented in a comprehensive
and extensive fashion, have an impact on outcomes. Even
more pressing is the need for studies on the effectiveness of
voluntary guidelines, since no studies were identified on
this topic. Another avenue of research could investigate the
mix of policy levers that are most effective when used
together.
The moderate evidence of an effect on final outcome
from the introduction of OHS legislation suggests, at face
value, that legislation may not always be the best approach
to addressing new and emerging health and safety issues.
The limited evidence for an impact on intermediate
outcomes further reinforces this interpretation. But the
studies in this cluster were quite heterogeneous in the type
of legislation being introduced, and this may be the reason
for the limited impact. They were also incremental to an
existing broad legislative framework and related regulatory
enforcement, and were designed to increase protection
related to a specific hazard. This is different from the
introduction of broad OHS legislative frameworks in
the 1970s and 1980s in many developed countries that were
the subject of effectiveness studies thereafter. Another
issue is that such studies need to consider a longer
measurement time period following the introduction of
legislation in order to capture the long-run impact.
Essentially awareness, compliance and ultimately injury
outcomes may take more time to improve than might have
been expected by researchers and regulators.
Clearly, given the right context, the introduction of
legislation can be effective, as was the case with smoke-free
workplace legislation. Looking at this particular example,
some lessons might be learned that can be generalized to
other areas. Possibly timing, public sentiment, and a broad
awareness of the serious health implications may be some
of the important ingredients. Also noteworthy were the
Review of OHS Regulatory Enforcement Version: October 28, 2015 11
concerns on the part of the restaurant and entertainment
industries with regards to the implication of such legislation
on business, concerns which were not vindicated. Also
important was the “across the board” nature of the legislation
in most jurisdictions. In fact, in the one study in Spain where
a choice was available between total, partial, or no restriction
[Fernandez et al., 2009], exposure reductions to second hand
smoke varied from substantial for total ban establishments,
modest for partial ban establishments, to inconsequential for
no ban ones.
The number of studies on the effectiveness of OHS
regulation has increased notably since the review by Tompa
et al. [2007] as has the quality. More studies are using microlevel data and robust statistical methods to address industryand organizational-level behavioral responses to regulation
and its enforcement. Earlier, less structured reviews that
drew on an older evidence base noted quality concerns and
concluded that, overall, the evidence suggests OSHA has
resulted in only a modest improvement in workplace health
and safety in the United States [Kralj, 2001; Mendeloff,
2001; Thomason, 2001].
In our review, the criteria of publication since 1990
onward eliminated some of the weaker (and older) studies.
Our expansion of the inclusion criteria to intermediate
outcomes has allowed us to explore a broader and richer
literature, such as the nature of enforcement and policy levers
such as awareness campaigns. The inclusion of studies
evaluating smoke-free workplace legislation provided an
example of successful introduction that might provide
lessons for regulation in other OHS areas.
Regarding the way forward for research, we would
encourage policymakers and researchers to work together to
build in policy evaluation, particularly with the introduction
of new legislation, changes in enforcement strategies, and
the roll out of awareness campaigns. This would lend itself
to better planned study designs, in some cases the possibility
of randomization or staggered introduction. Also, longer
measurement time periods may be needed with new
legislation in order to ensure there is time for stakeholders
to become aware of changes and respond accordingly. The
effectiveness of voluntary guidelines is a relatively uncharted area that urgently needs exploration.
More exploration is also needed of the context and
conditions for successful legislation and policy. Related to
this latter issue, the construct of how OHS policy levers
create incentives for organizations to improve OHS
processes and outcomes has direct implications for how
programs to address OHS within organizations are arranged
and implemented. It is noteworthy that such programs
themselves have been the subject of systematic reviews [e.g.,
Robson et al., 2007]. Consideration of the effectiveness of
such programs and how they are affected by policy levers
and other environmental factors is an area warranting
investigation.
CONCLUSIONS
There is a substantial body of evidence on the
effectiveness of legislative and regulatory policy levers at
improving intermediate and final outcomes. We identified
strong evidence of the following: (i) specific deterrence from
inspections with penalties results in a decrease in injuries;
(ii) consultative activity has no effect on injury outcomes
with some exceptions; and (iii) the introduction of smokefree workplace legislation reduces exposure to second hand
smoke. We identified moderate evidence of the following:
(i) a first inspection has the largest impact on compliance
rates; (ii) specific deterrence from inspections without
penalties has no effect on injuries except in particular
contexts; (iii) awareness campaigns improve compliance;
(iv) the introduction of OHS legislation as no effect on injury
outcomes; and (v) the introduction of smoke-free workplace
legislation reduces respiratory and/or sensory symptoms.
This study adds substantially to the evidence base
identified in an earlier review. In addition to new evidence
supporting previous study findings, it included new categories of evidence–compliance as an outcome, nature of
enforcement, awareness campaigns, and workplace smoking
legislation. The evidence is of value for informing policy
decision making in the OHS field, and provides insights into
areas warranting further exploration in future research.
AUTHORS’ CONTRIBUTIONS
Emile Tompa, Principal Investigator: Provided oversight
of the review, participated in the design of the study and all
phases of the systematic review process, and was the lead pen
of the manuscript. Christina Kalcevich, Project Co-ordinator:
Coordinated all aspects of the review, participated in the
design of the study and all phases of the systematic review
process, prepared materials for meetings and presentations,
drafted the methods section of the manuscript, and reviewed
drafts of the manuscript. Michael Foley, Co-investigator:
Participated in the design of the study and all phases of the
systematic review process, and reviewed drafts of the
manuscript. Chris McLeod, Co-investigator: Participated in
the design of the study and all phases of the systematic review
process, and reviewed drafts of the manuscript. Sheilah
Hogg-Johnson, Co-investigator: Participated in the design
of the study and all phases of the systematic review process,
and reviewed drafts of the manuscript. Kim Cullen,
Co-investigator: Participated in the design of the study and
all phases of the systematic review process, and reviewed
drafts of the manuscript. Ellen MacEachen, Co-investigator:
Participated in the design of the study, the title and abstract and
article inclusion selection process, and reviewed drafts of
the manuscript. Quenby Mahood, Co-investigator: Participated in the design of the study, provided library search and
12 Tompa et al.
systematic review guidance, and reviewed drafts of the
manuscript. Emma Irvin, Co-investigator: Participated in the
design of the study and all phases of the systematic review
process, provided library search and systematic review
guidance, and reviewed drafts of the manuscript.
ACKNOWLEDGMENTS
We thank our advisory committee members—Wayne
De L’Orme, Anne Duffy, Anne-Marie Feyer, Steve Mantis,
Carol Sackville-Duyvelshoff, Barbara Silverstein, Carmine
Tiano, David Walters, and Michael Zacks—for their
valuable guidance at key junctures during the process of
completing this review.
FUNDING
Funding for this review was provided by the Institute for
Work and Health, which is an independent, not-for-profit
research institute. The Institute receives funding from the
Prevention Office of the Ministry of Labour in Ontario,
Canada.
ETHICS APPROVAL AND INFORMED
CONSENT
Ethics review and approval was not sought for this
systematic literature review study, as it does not involve
human subjects or animals.
DISCLOSURE (AUTHORS)
The authors declare that there are no conflicts of
interest.
DISCLOSURE BY AJIM EDITOR OF
RECORD
Rodney Ehrlich declares that he has no competing or
conflicts of interest in the review and publication decision
regarding this article.
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SUPPORTING INFORMATION
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Review of OHS Regulatory Enforcement Version: October 28, 2015 15
SCHWERIN CAMPBELL BARNARD IGLITZIN & LAVITT
December 04, 2017 - 1:33 PM
Transmittal Information
Filed with Court: Supreme Court
Appellate Court Case Number: 94525-0
Appellate Court Case Title: Brandon Apela Afoa v. Port of Seattle
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Note: The Filing Id is 20171204132915SC824617
Supreme Court No. 92251-9
IN THE SUPREME COURT OF THE STATE OF
WASHINGTON
COMMON SENSE ALLIANCE, P.J. TAGGARES COMPANY, and
FRIENDS OF THE SAN JUANS,
Appellants,
v.
GROWfH MANAGEMENT HEARINGS BOARD, WESTERN
WASHINGTON REGION, and SAN JUAN COUNTY,
Respondents,
CROSS-ANSWER TO CROSS-PETITION FOR REVIEW
fiLED AS
\I I!,(> \iJ,ENT TO EMA\L
Kyle A. Loring, WSBA #34603
Attorney for Appellant
Friends of the San Juans
P.O. Box 1344
Friday Harbor, W A 98250
360-378-2319
kyle@sanjuans.org
~ ORIG\N~L
I. TABLE OF CONTENTS
I. TABLE OF CONTENTS ................................................................. i
II. TABLE OF AUTHORITIES .......................................................... ii
III. INTRODUCTION .......................................................................... 1
IV. COUNTERSTATEMENT OF THE CASE .................................... 2
V. ARGUMENT .................................................................................. 6
A. The Cross-Petition Does Not Raise a Valid Constitutional
Question Because the CAO Does Not Exact Property ....... 6
B. The Cross-Petition Does Not Identify a Valid Decisional
Conflict. ............................................................................ 14
VI. CONCLUSION ............................................................................. 18
II. TABLE OF AUTHORITIES
Cases
Citizens' Alliance for Property Rights v. Sims, 145 Wn. App. 649, 187
P.3d 786 (2008) ...................................................................................... 11
City of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 687,
119 S. Ct. 1624,143 L. Ed. 2d 882 (1999) ...................................... 15, 16
City of Olympia v. Drebick, 156 Wn.2d 289, 126 P.3d 802 (2006) ......... 16
Dolan v. City of Tigard, 512 U.S. 374, 114 S. Ct. 2309 (1994); ....... passim
Guimont v. Clarke, 121 Wn.2d 586, 854 P.2d 1 (1993) ........................... 13
Honesty in Environmental Analysis & Legislation v. Central Puget Sound
Growth Management Hearings Board, 96 Wn. App. 522,979 P.2d 864
(1999) ............................................................................................... 12, 13
In reMarriage of Rideout 150 Wash.2d 337,77 P.3d 1174 (2003) ........ 12
Kaiser Aetn!:!, 444 U.S., at 176 .................................................................... 8
Kitsap Alliance of Prop. Owners v. Cent. Puget Sound Growth Mgmt.
Hearings Bd., 160 Wn. App. 250, 255 P.3d 696, pet. rev. denied 171
Wn.2d 1030,257 P.3d 662 (2011) ................................................... 12, 13
Koontz v. St. Johns River Water Mgmt. Dist., _U.S._, 133 S. Ct. 2586
(2013) ................................................................................................. 7, 15
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 125 S. Ct. 2074, 161 L. Ed.
2d 876 (2005) ..................................................................................... 7, 15
Margola Assocs. v. Seattle, 121 Wn.2d 625, 854 P.2d 23 (1993) ...... 14, 17
Nollan v. California Coastal Commission, 483 U.S. 825, 107 S. Ct. 3141
(1987) .............................................................................................. passim
Orion Com. v. State, 109 Wn.621, 747 P.2d 1062 (1987) .................. 14, 17
Peste v. Mason County, 133 Wn. App. 456, 136 P.3d 140 (2006) ............. 8
Sintra, Inc. v. City of Seattle, 131 Wn.2d 640,935 P.2d 555 (1997) ....... 16
Smith et al. v. Town of Mendon, 789 N.Y.S.2d 696,4 N.Y.3d 1 (2004) 11,
12
11
Statutes
RCW 64.04.010 ........................................................................................ 10
RCW 64.04.130 ........................................................................................ 10
RCW 82.02.020 ........................................................................................ 10
Other Authorities
Black's Law Dictionary 185 (3rd pocketed. 2006) .................................... 9
Rules
RAP 13.4 ..................................................................................................... 6
lll
III. INTRODUCTION
Cross-Appellant Friends of the San Juans ("Friends") respectfully
submits this Cross-Answer to Appellants Common Sense Alliance's and
P.J. Taggares Company's (collectively "CSA") Cross-Petition for Review.
CSA asserts that this Court should accept review of that Cross-Petition on
the grounds that the Court of Appeals erred in denying CSA's
unconstitutional conditions argument. CSA had argued that San Juan
County's Critical Areas Ordinance ("CAO") conditions new development
near critical areas on the dedication of property without a nexus and rough
proportionality to a development's likely water pollution impacts. The
Court of Appeals' opinion ("Opinion") rejected that argument because: (1)
the CAO's buffers do not constitute exactions because they do not transfer
private property to public use; and (2) the unconstitutional conditions
doctrine does not apply to legislation.
CSA' s argument rests on an untenable foundation -the assumption
that buffers constitute exactions. CSA invites this Court to expansively
revise federal Takings Clause jurisprudence to apply the unconstitutional
conditions doctrine to legislation that does not transfer private property for
public use. Federal courts have limited the application ofthat doctrine to
"the special context" of land-use exactions, where the government
1
conditions the approval of a development permit on the landowner's
dedication of an easement or a piece of real property to public use. The
CAO does no such thing -- instead, it places some development limits on
narrow bands of land directly adjacent to critical areas like juvenile
salmon habitat. Furthermore, it resulted from a lengthy legislative process
and thus does not invoke the concern that spawned the unconstitutional
conditions doctrine -that government may take advantage of its power
and discretion in land-use permitting to demand a transfer of property.
The CAO's undersized, site-specific buffers do not constitute
exactions and do not give rise to a significant question of constitutional
law or, with the exception of the amount of development that can occur
within them, conflict with a decision of this Court.
IV. COUNTERSTATEMENT OF THE CASE
On December 4, 2012, San Juan County ("County") adopted a
CAO that designated shoreline critical areas based on their ecological
sensitivity and priority and adopted a site-specific buffer sizing procedure
based on the type of critical area, the amount of development, and its
proximity to the critical area. On September 6, 2013, the Growth
Management Hearings Board ("Board").upheld those designations but
struck most of the buffer sizes as too small to protect water quality and
habitat based on the Best Available Science ("BAS"). On August 10,
2
2015, the Court of Appeals issued an Opinion that upheld the Board's
decision, in part rejecting CSA's argument that shoreline buffers constitute
exactions for which Constitutional Takings jurisprudence requires a nexus
and proportionality to the harm.
The remainder of this section addresses several factual
misstatements offered by the Cross-Petition. Cross-Petition, at 3-7. CSA
misidentifies: (1) the ownership ofthe shoreline buffers and amount of
development that can occur in the buffers; (2) the size of the buffers; and
(3) considerations in the buffer calculation. Id.
First, the CAO's shoreline water quality buffer provisions do not
require property owners to dedicate a buffer to anyone as a condition for
approval of a land use permit. Administrative Record ("AR") 4241 (buffer
definition without reference to transfer of property), 4360-61 (ordinance
language identifying at Step 3 the procedure for determining buffers
without requiring transfer of property). Although the CAO restricts some
development in water quality buffers, it allows a substantial amount of
activity there, including but not limited to: the repair and replacement of
nonconforming structures and uses (AR 4269); new utility installation
(AR 4269); development of up to 4,000 square feet of orchards and
gardens (AR 4365); well drilling in the outer 25% (AR 4365); annual
removal of20% of tree and shrub foliage (AR 4365); and on-site sewage
3
disposal system components (AR 4366).
Second, the CAO's water quality buffers for Fish and Wildlife
Habitat Conservation Areas ("FWHCAs") extend to a maximum of just
1 25 feet from the Ordinary High Water Mark, not the 205 feet claimed,
and even then only if the development will cover nearly 100% of a parcel.
Compare Cross-Petition, at 4 with AR 4361 (directing landowners to
establish shoreline water quality buffer for 60% pollutant removal using
the process for wetland buffers at AR 4324-29).
Third, while the buffer sizing procedure did not establish buffers
large enough to protect critical areas, its flow path calculation expressly
incorporated the contribution of pollutants associated with the amount of
development proposed and the rate at which they would travel toward the
critical area during rains. AR 4326-27 (Tables 3.3, 3.4, 3.5). The CAO
dedicates seven pages of its wetlands ordinance to the site-specific process
for locating and sizing water quality buffers. AR 4323-29, 4360-61. While
the Board agreed that those buffers were not large enough to protect the
water quality of either wetlands or FWHCAs, they incorporate the size of
a proposed development and landscape characteristics into their sizing
calculation. AR 6284-293, 6303-305. 1 For shorelines, a landowner
1 Since the Board's decision, the County has adopted a new buffer sizing method. That
method takes two primary factors into consideration for buffer sizing, the type of critical
area and land use intensity of the proposed development.
4
conducts the multi-step process for sizing the water quality buffer,
including: (1) determining whether the development will occur within 205
feet of the FWHCA; (2) determining whether the development area will
drain to the FWHCA; (3) determining the water quality-sensitivity rating;
and (4) determining the stormwater discharge factor by: (a) identifying the
flow path, (b) determining the different types of land cover along that flow
path, including the development, (c) calculating the length of each
different land cover along the flow path, (d) identifying the base
storm water discharge factor for each type of land cover, (e) determining
the slope for each segment of the flow path, (f) determining the
drainageway along each segment of the flow path, (g) calculating the
composite storm water discharge factor for the full extent of the drainage
area, and (h) using that discharge factor to identify the buffer width. AR
4361 (Step 3, referencing the process at AR 4323-29).
The BAS in the record identifies buffers as an effective method for
protecting FWHCAs. AR 3708-723, 3535-552, 4069-4205, 4654-55,
4675-684 (recommending buffers from 150 to 250 feet in width). Buffers
provide separation zones between water bodies and development activities
intended to limit impacts from those activities on the natural functioning
of streams, lakes, and marine waters. AR 3708, 4076. Buffers typically are
relatively undisturbed areas that host mature vegetation consistent with the
5
natural potential of the site. AR 4076.2 The Aquatic Habitat Guidelines
Program, a collaboration of several state agencies, notes that an average
water quality buffer size of358 feet would have an 80% likelihood of
effectively removing pollutants. AR 4655.
V. ARGUMENT
The Cross-Petition does not satisfy either of the constitutional
issue or decisional conflict grounds necessary for the Court's review. RAP
13.4. CSA argues that: (1) the Court of Appeals summarily rejected its
argument that a buffer is an exaction, giving rise to a question of
constitutional law; and (2) the decision below conflicts with this Court's
decisions by creating an exception to Nollan v. California Coastal
Commission and Dolan v. City ofTigard. Cross-Petition, at 10-17. The
first argument fails because the CAO legislation does not require the
dedication of private property to public use. The second argument fails
because state and federal courts have limited their application of the
unconstitutional conditions doctrine to site-specific application of a
regulation and to only the exaction context.
A. The Cross-Petition Does Not Raise a Valid Constitutional
Question Because the CAO Does Not Exact Property.
The Cross-Petition urges the Court to break from settled
2 For example, the BAS Synthesis recommends protection for juvenile salmon in the form
ofriparian buffers consistent with the salmon recovery plan. AR 3680-81.
6
constitutional jurisprudence and now determine that buffers that limit
some development constitute dedications of private property. CrossPetition, at 10. However, the heightened scrutiny ofthe unconstitutional
conditions doctrine enunciated by Nollan, and Dolan does not apply to the
CAO's buffer system because the legislatively-adopted CAO does not
transfer a property right in exchange for a land use permit. See, e.g.,
Koontz v. St. Johns River Water Mgmt. Dist., _U.S._, 133 S. Ct. 2586,
2603 (2013) (applying to government demand for money); Lingle v.
Chevron U.S.A. Inc., 544 U.S. 528, 546-47, 125 S. Ct. 2074, 161 L. Ed.
2d 876 (2005); Dolan, 512 U.S. 374, 114 S. Ct. 2309, 129 L. Ed. 2d 2309
(1994); Nollan, 483 U.S. 825, 841, 107 S. Ct. 3141, 97 L. Ed. 2d 677
(1987) (noting heightened risk "where the actual conveyance of property
is made a condition to the lifting of a land use restriction."). None of the
decisions cited by CSA hold otherwise.
Neither ofNollan or Dolan suggest that buffers effect a dedication
of private property to public use. See Dolan, 512 U.S. at 393; Nollan, 483
U.S. at 827. In each of those cases, a government agency requested the
dedication of property to public use in exchange for approval of a
development permit. In Dolan, the City of Tigard required Dolan to
dedicate to it ownership of property for a stream buffer. 512 U.S. at 379-
80. In discussing the character of this request, the U.S. Supreme Court
7
expressly distinguished between a private floodplain and a public
greenway, noting that "[t]he city has never said why a public greenway, as
opposed to a private one, was required in the interest of flood control." ld.
at 393. The court concluded that "[t]he difference to petitioner, of course,
is the loss of her ability to exclude others," and the Court noted that ''the
loss of her ability to exclude others is 'one of the most essential sticks in
the bundle of rights that are commonly characterized as property."' ld.
(quoting Kaiser Aetna, 444 U.S., at 176). In Nollan, the California Coastal
Commission sought a public easement across appellants' beaches in
exchange for a permit to construct a larger house. 483 U.S. at 827. In stark
contrast, the CAO's legislatively-adopted buffers do not transfer
ownership of any property right. Instead, they limit some of the
development that might otherwise occur there. AR 4358-368.
Washington jurisprudence confirms that the CAO does not alter a
property's ownership--the landowner retains the same fundamental
attributes of property ownership that she had before the regulations, the
rights: to possess, exclude others, dispose of, and make some
economically viable use of the property. See Peste v. Mason County, 133
Wn. App. 456, 471, 136 P.3d 140 (2006). Contrary to CSA's argument,
marking a buffer on a site plan does not accidentally dedicate a property
interest to the public. See Richardson, 108 Wn. App. at 890-91. A
8
common law dedication occurs when an owner designates land, or an
easement on such land, for use by the public, and that designation is
accepted on behalf of the public. Id.; see also Black's Law Dictionary 185
(3rd pocketed. 2006) (defining dedication as "[t]he donation of land or
creation of an easement for public use."). A dedication may occur
expressly, such as through a deed or oral or written declaration, or
impliedly, as evidenced by some course of conduct by the property owner.
Id. A statutory dedication must be made in conformity with the laws
regulating the property. I d. A landowner reserves no rights that would be
incompatible or interfere with full public use of the dedicated property. Id.
at 891. A party asserting the existence of a dedication has the burden of
establishing that it meets all of the necessary elements, including the
owner's intent to dedicate the property. ld.
The CAO does meet the criteria for dedicating property. First,
marking a buffer on a document does not demonstrate the requisite
landowner intent to give the land to the County. Second, the CAO does
not authorize members of the public to use the land. Third, the CAO
authorizes a substantial amount of activity that would interfere with public
use of the property. AR 4362-68. Consequently, neither the adoption of
the CAO nor any of its provisions effects a dedication.
Moreover, CSA's citation to the state law that requires a particular
9
form for instruments of conveyance confirms that the CAO does not meet
the legal criteria required to convey property to the County. CrossPetition, at 11-12; RCW 64.04.130. RCW 64.04.130 establishes the
authority for certain public or nonprofit entities to hold and convey
property interests and directs them to comply with legal requirements for
instruments that convey interests in real property. RCW 64.04.130. That
statute clarifies that such conveyances of real estate may occur only by
deed. RCW 64.04.010. The CAO does not require private landowners to
submit deeds to the County.
In addition, CSA mistakes a conservation overlay for a dedication
to public use. CSA asserts that the Court in Isla Verde International
Holdings. Inc. v. City of Camas deemed "a code provision requiring
'reservation of open space' as a condition of permit approval. .. the
equivalent of a dedication." Cross-Petition, at 10 n.4. However, the Court
in Isla Verde declined to decide whether the open space set aside
constituted a dedication. Isla Verde, 146 Wn.2d 740, 759, 49 P.3d 867
(2002). Instead, it reviewed a permit condition requiring a 30% open space
set aside and concluded that, "the open space set aside condition is an in
kind, indirect 'tax, fee, or charge' on new development," and that it thus
required consistency with RCW 82.02.020. ld. Likewise, in reviewing
clearing limits adopted by King County, the court in Citizens' Alliance for
10
. Property Rights v. Sims did not analyze whether the clearing limits
constituted a dedication, instead merely evaluating them as "an in kind
indirect 'tax, fee, or charge' on development under RCW 82.02.020." 145
Wn. App. 649,664, 187 P.3d 786 (2008). Thus, neither of these decisions
supports the allegation that a buffer constitutes a dedication of private land
for public use.
Although not precedential, a 2004 opinion from New York's Court
of Appeal thoughtfully explains why the unconstitutional conditions
doctrine does not apply to conservation policies. Smith et al. v. Town of
Mendon, 789 N.Y.S.2d 696, 4 N.Y.3d 1 (2004).3 The issue there was
whether a municipality commits an unconstitutional taking when it
conditions site plan approval on the landowner's acceptance of a
development restriction consistent with the municipality's preexisting
conservation policy. Id. at 4 N.Y.3d 6. The court declined to analyze the
restriction as an exaction, noting that "[e]xactions are defined as 'land-use
decisions conditioning approval of development on the dedication of
property to public use." Id. at 10 (emphasis in original) (citing City of
Monterey, 626 U.S. at 702). The court held that the restriction merely
placed conditions on development and declined to extend the concept of
3 Attached hereto as Appendix A.
11
exaction to it because there was no dedication of property. Id. at 12. The
CAO buffers likewise merely limit some development on some properties,
and do not transfer private property to public use.
Further, to the extent that Honesty in Environmental Analysis &
Legislation v. Central Puget Sound Growth Management Hearings Board
("HEAL") and Kitsap Alliance of Property Owners v. Central Puget
Sound Growth Management Hearings Board ("KAPO") reference a nexus
and proportionality standard, they are inapposite here. The HEAL court
asserted sua sponte in dictum that policies and regulations adopted under
the GMA must observe nexus and proportionality. 96 Wn. App. 522, 533-
34, 979 P.2d 864 (1999). After recognizing that "[t]he briefs of the parties
omit any discussion" of nexus and proportionality, the court briefly
discussed that topic. Id. at 533. However, this discussion constituted
dictum because it was not necessary to resolve whether the GMA requires
BAS to be included substantively in the adoption of a CAO. ld at 525-26
(setting forth issues); see In reMarriage of Rideout, 150 Wash.2d 337,
354, 77 P.3d 1174 (2003) (where language has no bearing on decision,
that language is dictum). Further, the court did not cite legal support for its
proposal to substantially expand the reach of the unconstitutional
conditions doctrine, did not conduct a Gunwall analysis, and did not
inquire into the limited application of the doctrine to exactions. See
12
HEAL, 96 Wn. App. at 533-35; Guimont v. Clarke, 121 Wn.2d 586,604,
854 P.2d 1 (1993) (where party does not brief relevant Gunwall factors
necessary to determine whether independent analysis of state constitution
is proper, court will analyze only federal constitution). As discussed at
Section V.B. below, no federal court has applied Nollan and Dolan beyond
the exaction context.
In addition, to the extent that Division 2 of the Court of Appeals
referenced the nexus and proportionality test in KAPO, it likewise did not
provide any legal basis for unsettling decades of Washington and federal
jurisprudence. KAPO, 160 Wn. App. 250,272,255 P.3d 696, pet. rev.
denied 171 Wn.2d 1030, 257 P.3d 662 (2011). Instead, that court relied
without explanation on the dictum from HEAL to reference nexus and
proportionality criteria in the context of a due process argument. Id. at
272-73. The court summarily announced those criteria without analyzing
whether Nollan and Dolan should be extended well beyond the context of
exactions. Id. Friends agrees with CSA that the nexus and proportionality
tests constitute a special application of the unconstitutional conditions
doctrine, and with the direction in Koontz that that doctrine applies in only
the context of exactions.
13
B. The Cross-Petition Does Not Identify a Valid Decisional
Conflict.
The Cross-Petition incorrectly argues that the Opinion conflicts
with state and federal decisions by creating an exception to federal
exaction jurisprudence. Cross-Petition, at 12-17. However, like the
Opinion, U.S. Supreme Court decisions limit the application of the
unconstitutional conditions doctrine to local permit decisions that require
the dedication of private property to public use in exchange for a
development permit. The cited Washington decisions likewise either do
not address the nexus and proportionality criteria that apply to exactions or
do not apply them in that setting. See Margola Assocs. v. Seattle, 121
Wn.2d 625, 647, 854 P.2d 23 (1993), Orion Com. v. State, 109 Wn.621,
653,747 P.2d 1062 (1987)). Consequently, the Opinion does not conflict
with either federal or state takings jurisprudence that applies uniquely to
exactions.
Contrary to CSA's claims, the Opinion accords with U.S. Supreme
Court jurisprudence limiting the unconstitutional conditions doctrine to
exactions during the permitting process. In City of Monterey v. Del Monte
Dunes at Monterey, Ltd., the court declared that it had not extended
Dolan's rough proportionality test "beyond the special context of
exactions-land-use decisions conditioning approval of development on
14
the dedication of property to public use." 526 U.S. 687, 702-03, 119 S. Ct.
1624, 143 L. Ed. 2d 882 (1999). The following year, the U.S. Supreme
Court stated in Lingle that "[b]oth Nollan and Dolan involved Fifth
Amendment takings challenges to adjudicative land-use exactionsspecifically, government demands that a landowner dedicate an easement
allowing public access to her property as a condition of obtaining a
development permit." 544 U.S. at 546 (emphasis added). In Koontz v. St.
Johns River Water Management District, the U.S. Supreme Court
indicated that application of the unconstitutional conditions doctrine is
limited to the context ofland-use exactions to protect an applicant's
constitutional right to just compensation for "property the government
takes when owners apply for land-use permits." Koontz, 133 S. Ct. at
2594-95 (emphasis added) (citing Lingle, 544 U.S. at 547). The doctrine
grew out of a concern that a governmental entity might apply its power
and discretion in land-use permitting to appropriate excessive private
property for public use as a condition of a permit. Koont~ 133 S. Ct. at
2594-95. In her dissent, Justice Kagan noted that the Nollan and Dolan
decisions "provide an independent layer of protection in 'the special
context of land-use exactions.'"_ U.S._, 133 S. Ct. 2586,2604 (2013) (J.
Kagan dissenting) (citing Lingle, 544 U.S. at 538 and referencing Nollan
and Dolan).
15
Because the legislatively-adopted CAO is not a permit decision
and does not require landowners to dedicate private land for public use, it
does not warrant that extra layer of protection and thus is not subject to the
exactions analysis conducted in Nollan and Dolan. See id.; Richardson v.
Cox, 108 Wn. App. 881, 890-91,26 P.3d 970 (2001).
In the context of development fees, the Washington Supreme Court
has distinguished between legislatively prescribed development fees and
direct mitigation fees in holding that the Nollan and Dolan standards do
not apply to the former. See City of Olympia v. Drebick, 156 Wn.2d 289,
301-02, 126 P.3d 802 (2006). And in his concurrence in Sintra, Inc. v.
City of Seattle, Justice Durham noted that ''Nollan and Dolan do not
inform the doctrine of regulatory takings, which is concerned with overly
burdensome restrictions on the use of private property." 131 Wn.2d 640,
671,935 P.2d 555 (1997).
In citing two Washington decisions for the proposition that the
unconstitutional conditions doctrine applies to legislation, CSA conflates
the enhanced federal constitutional protections for exactions with
constitutional takings jurisprudence generally. At the tail end of its
argument, CSA references two Washington cases for the proposition that
"this Court has applied the nexus and proportionality standards to
legislatively imposed conditions on development. Cross-Petition, at 17
16
(citing Margola Assocs., 121 Wn.2d at 647, Orion Corp., 109 Wn.at 653).
Yet, neither of those decisions demonstrates that legislation
warrants review for a nexus or proportionality. In Margo1a Assocs., the
Court's constitutional analysis did not delve into nexus and
proportionality, instead holding that the City of Seattle's fee did not result
in a regulatory taking because it did not deny all economically viable use
of the property or result in a physical taking. 121 Wn.2d at 646-48. In
Orion Corp., the Court deemed the challenge ripe "despite the lack of a
final decision by the local regulatory decisionmaker concerning uses
allowed on Orion's property" due to the unusual circumstances in that
case. 109 Wn.2d at 658. Those unusual circumstances included the
creation of a sanctuary that would have rendered any application for a
permit by Respondent Orion Corporation futile. Id. at 632-33. Further,
although the Court referenced Nollan and the nexus concept, it applied
that concept largely to the creation of a sanctuary surrounding the land in
question, not the local shoreline master program. Id. at 663-64. Indeed, the
Court noted that "prior to the Sanctuary the regulations allowed for some
economic uses consistent with the preservation goal." Id. at 663.
Consequently, to the extent that the Court applied a nexus standard, it did
so in the context of the sanctuary's land purchasing process rather than the
broad adoption of a local ordinance. Id. at 663-64.
17
VI. CONCLUSION
CSA has not demonstrated that its Cross-Petition warrants review.
The Court of Appeals applied federal and state exaction jurisprudence
when it rejected CSA's request to apply the unconstitutional conditions
doctrine to a site-specific buffer program. Consequently, the Opinion did
not give rise to an important constitutional question or a decisional
conflict on that issue, and the Court should deny the Cross-Petition.
18
Appendix A
Page 696
789 N.Y.S.2d 696
4 N.Y.3d 1
In the Matter of Paul Smith et al., Appellants
v.
Town of Mendon et al., Respondents
New York Court of Appeal
December 21, 2004
Argued November 17, 2004
[4 N.Y.3d 2] COUNSEL
[4 N.Y.3d 3] Galvin and Morgan, Delmar (James
Morgan and Madeline Sheila Galvinof counsel), for
appellants.
[4 N.Y.3d 4] Chamberlain D'Amanda Oppenheimer
& Greenfield, LLP, Rochester (George D. Marron and
Sheldon W. Boyceof counsel), for respondents.
[4 N.Y.3d 5] Eliot Spitzer, Attorney General,
Albany (Caitlin J. Halligan, Daniel Smirlock, Peter H.
Lehner, John J. Sipos and Susan L. Taylorof counsel), for
State of New York, amicus curiae.
Community Rights Counsel, Washington, D.C.
(Jason C. Rylander of counsel), for Association of Towns
of the State ofNew York and others, amicicuriae.
[4 N.Y.3d 6] Rosenblatt, J.
This appeal calls on us to determine whether a
municipality commits an unconstitutional taking when it
conditions site plan approval on the landowner's
acceptance of a development restriction consistent with
the municipality's preexisting conservation policy. We
hold that it does not.
I.
Paul and Janet Smith own a 9.7 acre lot in the Town
of Mendon. Situated along Honeyoe Creek, a protected
waterway, the lot includes several environmentally
sensitive parcels, falls within the creek's I 00-year
floodplain boundary and is located within 500 feet of a
protected agricultural district. It also contains a woodlot
and steep sloping areas susceptible to erosion. Several
portions of the property sit within areas classified as
environmental protection overlay districts (EPODs),
pursuant to section 200-23 of the Mendon Town Code.
Four separate EPODs limit the Smiths' use of their
property. The first, a "Steep Slope" EPOD, bars the
construction of new buildings or structures, the clearing
of any land area, the installation of sewage disposal
systems, the discharge of storm water and the placement
of stormwater runoff systems, and filling, cutting or
excavation operations within the designated district.
Property owners may acquire development permits for
projects within a Steep Slope EPOD if they can show that
their proposed activities will not destabilize the soil,
cause erosion or unnecessarily destroy ground cover.
They must further demonstrate that there is no reasonable
alternative for the proposed activity.
[4 N.Y.3d 7] The other three EPODs apply to
sensitive lands bordering a major creek, an established
wooded area and a floodplain. All contain comprehensive
use restrictions similar to the Steep Slope EPOD. As a
prerequisite for issuance of a development permit, all
require specific showings that the proposed activity will
not result in injuries to the covered, environmentally
sensitive districts.
In December 200 I, the Smiths applied to the Town
Planning Board for site plan approval to construct a
single-family home on the non-EPOD portion of their
property. Following various proceedings, the Planning
Board issued a final site plan approval in July 2002. The
Board concluded that the Smiths' proposal was not likely
to result in any adverse environmental impacts as long as
no development occurred within the EPOD portions of
the site. It conditioned final site plan approval on the
Smiths' filing a conservation restriction on any
development within the mapped EPODs and amending
the final site plan map accordingly. Such action, the
Planning Board stated, would "put subsequent buyers on
notice that the property contains constraints which may
limit development within these environmentally sensitive
areas." The Board also determined that the restriction
would provide the most meaningful and responsible
means of protecting the EPODs.
The conservation restriction sought by the Town
closely tracked the limitations set by the EPOD
regulations. Under the restriction, which would run with
the land and bind subsequent owners, the Smiths would
be prohibited in the EPODs from "[c]onstruction,
including, but not limited to structures, roads, bridges,
drainage facilities, barns, sheds for animals and livestock
and fences," the "[c]lear-cutting of trees or removal of
vegetation or other ground cover," changing the "natural
flow of a stream" or disturbing the stream bed, installing
septic or other sewage treatment systems, and using
motorized vehicles.
The restriction also required the Smiths to maintain
the "Restricted Area" in accordance with the terms of
their grant and permitted the Town, upon 30 days' written
notice, to enter the property to safeguard the
environmentally sensitive parcels. The Smiths, their
successors and their assigns, however, retained their
rights to "full use and quiet enjoyment" of the EPODs.
Critically, they retained the right to exclude others from
the entirety of their 10-acre parcel.
The terms of the proposed "Grant of Conservation
Restriction" mirrored the preexisting EPOD regulations,
differing in only [4 N.Y.3d 8] a few respects. First, the
conservation restriction encumbered the servient property
in perpetuity, whereas the Town could amend its EPOD
ordinance. Under both the EPOD system and the
conservation restriction, however, the Smiths could seek
permission from the Town to conduct a proscribed
activity in the environmentally sensitive parcels. Second,
the conservation restriction afforded the Town greater
enforcement power. Under the EPOD regime, the Town
could only issue citations for violations, whereas with the
conservation restriction, it could seek injunctive relief.
Rejecting the proposed conservation restriction, the
Smiths commenced this hybrid declaratory
judgment/CPLR article 78 proceeding, asserting that the
restriction worked an unconstitutional taking. [ 1] The
Town moved for an order dismissing or granting
summary judgment against the Smiths' claims. Applying
Dolan v City of Tigard (512 U.S. 374 [1994]), Supreme
Court concluded that, although the conservation
restriction was an "exaction," it did not effect an
unconstitutional taking. The Smiths appealed.
The Appellate Division determined that Supreme
Court erred in characterizing the conservation restriction
as an exaction. It affirmed, however, holding that,
because the proposed conservation restriction bore a
reasonable relationship to the Town's objective of
preserving the environmentally sensitive EPODs, there
was no taking entitling the Smiths to compensation (see 4
A.D.3d 859 [4th Dept 2004]). The Smiths appeal as of
right from the Appellate Division order, and we now
affirm.
II.
The Fifth Amendment to the United States
Constitution provides "nor shall private property be taken
for public use, without [4 N.Y.3d 9] just compensation."
[2] Historically, takings jurisprudence involved instances
in which the government encroached upon or occupied
real property for public use. [3] Beginning with
Pennsylvania Coal Co. v Mahon (260 U.S. 393 [1922]),
the Supreme Court recognized that, even if the
government does not seize or occupy a property, a
governmental regulation can work a taking if it "goes too
far" (id. at 415).
In the years following Mahon, the Supreme Court
offered "some, but not too specific, guidance to courts
confronted with deciding whether a particular
government action goes too far and effects a regulatory
taking" (Palazzolo, 533 U.S. at 617). The first and
perhaps most critical factor in the Court's takings
analyses became whether the regulation deprived
landowners of "all economically viable use" of their
property. [4]
If the contested regulation falls short of eliminating
all economically viable uses of the encumbered property,
the Court looks to several factors to determine whether a
taking occurred, including "the regulation's economic
effect on the landowner, the extent to which the
regulation interferes with reasonable investment-backed
expectations, and the character of the government
action." [5] In a different formulation of this third factor,
the Supreme Court held in Agins v City of Tiburon (447
U.S. 255, 260 [1980]) that the "application of a general
zoning law to particular property effects a taking if the
ordinance does not substantially advance legitimate state
interests" (see also Bonnie Briar Syndicate v Town of
Mamaroneck, 94 NY2d 96 [1999]). [6]
[4 N.Y.3d 10] Styling the conservation restriction an
exaction, the Smiths argue that we should not review the
Town's action under the Penn Central !Agins standard.
We disagree. Exactions are defined as "land-use
decisions conditioning approval of development on the
dedication of property to public use" (City of Monterey v
Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 702
[ 1999] [emphasis added]). In a narrow, readily
distinguishable class of cases, the Court has held such
conditions unconstitutional.
In Nollan v California Coastal Commn. (483 U.S.
825 [ 1987]), the Court considered whether conditioning a
development permit on the property owners' transfer to
the public of an easement across their beachfront violated
the Takings Clause. The Court deemed the condition
unconstitutional because it lacked an "essential nexus"
(id. at 837) with the stated purpose of the underlying
land-use restriction--"protecting the public's ability to see
the beach, assisting the public in overcoming the
'psychological barrier' to using the beach created by a
developed shorefront, and preventing congestion on the
public beaches" (id. at 835). Nevertheless, the Court
noted that the government could have conditioned the
grant of a development permit on restrictions that
promoted the public's ability to see and psychologically
access the beach, such as height limitations, width
restrictions, and the like (id. at 836).
In Dolan v City of Tigard (512 U.S. 374 [1994]), the
Supreme Court added a second layer to the "essential
nexus" test--"rough proportionality." In Dolan, the
municipality conditioned approval of a building permit
on the landowner's dedication of, first, a portion of her
property lying within a 1 00-year floodplain for
improvements to a storm drainage system and, second, a
strip of land adjacent to the floodplain for use as a
pedestrian and bicycle path. The Court concluded that an
essential nexus existed between these development
conditions and a legitimate governmental purpose, but
nevertheless determined that the municipality's proposed
exactions were impermissible under a "rough
proportionality" standard (id. at 391 ).
A showing of rough proportionality, the Court ruled,
requires a municipality to "make some sort of
individualized determination that the required dedication
is related both in nature and extent to the impact of the
proposed development" (id.). A "precise mathematical
calculation" is not required (id.). The exactions [4 N.Y.3d
11] at issue were not roughly proportional, the Dolan
court reasoned, because the municipality had failed to
meet its burden of showing the impact of the proposed
construction on its flood and traffic abatement efforts.
The Court stressed, however, that the municipality could,
for instance, have conditioned the grant of a development
permit on the transfer of a pedestrian/bicycle pathway
easement if it had made "some effort to quantify its
findings" that the construction would generate more
traffic (id. at 395). In other words, a municipality could
place otherwise unconstitutional conditions on the
issuance of a regulatory permit if the condition furthered
the purpose of the underlying development restriction and
there was a rough proportionality between the condition
and the impact of the proposed development.
With City of Monterey v Del Monte Dunes at
Monterey, Ltd. (526 U.S. 687, 702 [1999]), the Court
placed a key limitation on Dolan, indicating that the
"rough proportionality" test did not apply beyond the
special context of exactions. The Court added that the test
was not "designed to address, and is not readily
applicable to" a case in which the landowner's challenge
is based on denial of development, as opposed to
excessive exactions (id. at 703).
III.
The Attorney General has submitted an amicus brief
arguing for affirmance, cogently pointing out that the
present case involves efforts by the Town of Mendon to
protect environmentally sensitive lands by means of a
"do-no-harm" restriction that involves no property
dedication of the type encountered in Nollan and Dolan.
We agree. Under the Supreme Court's doctrinal
framework, the Appellate Division correctly determined
that the Town's conservation restriction was not an
"exaction" subject to the closer scrutiny of the Dolan test.
[7] In City of Monterey (526 U.S. at 702), the Court
observed that an exaction involves the conditioning of a
land-use decision on the "dedication of property to public
use" (emphasis added).
There is no such dedication of "property" here. In
practice, the Court has identified exactions in only two
real property cases, Nollan and Dolan, both of which
involved the transfer of the [4 N.Y.3d 12) most important
"stick" in the proverbial bundle of property rights, the
right to exclude others. (8] In Twin Lakes Dev. Corp. v
Town of Monroe (I N.Y.3d 98 (2003]), we also
characterized a fee imposed in lieu of the physical
dedication of property to public use as an exaction.
Outside of these two narrow contexts, neither the
Supreme Court nor this Court has classified more modest
conditions on development permits as exactions. Thus,
we decline the Smiths' invitation to extend the concept of
exaction where there is no dedication of property to
public use and the restriction merely places conditions on
development.
The Smiths argue that by its conservation restriction
the Town is requiring them to surrender the right to seek
a variance under the particular procedures of the EPOD
regime. On the record before us, we are not persuaded
that this can properly be characterized as the
relinquishment of a property right. If it is a property right,
however, it is trifling compared to the rights to exclude or
alienate. [9] Under the "Grant of Conservation
Restriction," the Smiths could still apply to the Town for
permission to conduct prohibited activities within the
"Restricted Area."
Under the circumstances of this case, the difference
between the Smiths' rights under the EPOD ordinance
and the conservation restriction is subtle: section 200-23
of the Mendon Town Code affords the Planning Board
wide discretion in granting development [4 N.Y.3d 13]
permits within EPODs; by contrast, under the proposed
conservation restriction, the Board would have essentially
unfettered discretion to grant or deny such permits. The
right to seek a variance from a planning board that enjoys
broad, as opposed to unmitigated, discretion may be
among the more modest and fragile twigs in the bundle of
property rights, if it is a property right at all. To be sure,
conditioning a development permit on its surrender
should not trigger the same constitutional scrutiny as the
regulatory extortion of sticks far more integral to the
bundle, such as the right to exclude third persons (a right
the Smiths fully retain). [ 1 0]
IV.
Because the Town's development condition is not an
exaction, we review it according to the standard
enunciated by the Court in A gins v City of Tiburon ( 44 7
U.S. 255 [1980]; see also Penn Cent. Transp. Co. v City
of New York, 438 U.S. 104 (1978]), as opposed to
Dolan's rough proportionality test. Examined in this light,
the conservation restriction does not effect an
unconstitutional taking.
First, the restriction would not appreciably diminish
the value of the Smiths' property, let alone deny them
economically viable use of it--as demanded by Agins
(447 U.S. at 260). [11] In exchange for their acceptance
of the restriction, the Smiths would gamer a permit to
construct a single-family home on their property. [12] A
single dwelling on a protected, 1 0-acre parcel is a
valuable, marketable [4 N.Y.3d 14] asset. Indeed, it is not
clear that the conservation restriction would have any
effect whatsoever on the market value of the Smiths'
property. Given the development bar created by the
preexisting EPOD ordinance, the legitimacy of which the
Smiths do not challenge, the encumbered parts of the
property had almost no developmental value before the
Town announced the conservation restriction. Second, the
conservation restriction substantially advances a
legitimate government purpose--environmental
preservation. As we indicated in Bonnie Briar Syndicate,
Inc. v Town of Mamaroneck (94 NY2d 96, 108 [ 1999]), a
regulatory action need only be reasonably related to a
legitimate governmental purpose to satisfy the
"substantially advance" standard. [13] Such a relationship
undeniably exists here. The conservation restriction will
advance the Town's aim ofpreserving environmentally
sensitive areas in perpetuity, place future buyers on
notice of the development limitations on the Smiths'
property and furnish the Town with a more effective
means of ensuring compliance with its regulatory
objectives. In all, and in keeping with preexisting
conservation policies, the restriction merely gives the
Town the power to interdict harmful activities within the
EPODs on the Smiths' parcel.
In dissent, Judge Graffeo argues that the
conservation restriction effects a taking under Agins
because, in her view, it advances the Town's interests
only marginally, if at all. We disagree. Ensuring
perpetual protection for open spaces--along with the
resources and habitats they shelter--from the vicissitudes
of workaday land-use battles is hardly an inconsequential
governmental interest. At the very least, the permanent
character of the conservation restriction will spare the
Town the administrative cost of continually being forced
to maintain its conservation policies. More importantly,
as the Attorney General [4 N.Y.3d 15] observes, the
conservation restriction imposed by the Town, as a
species of negative easement (see Huggins v Castle
Estates, Inc., 36 NY2d 427, 430 [1975]), is a "well
established land use tool" that is "consistent with the
State's longstanding commitment to protecting ... critical
natural resources" (Attorney General's brief at 2). Further,
even assuming that the marginal benefit to the Town from
the conservation restriction were, as Judge Graffeo
suggests, modest, it would nonetheless be legitimate.
Under the holdings of Agins, Penn Central and their
progeny, a modest environmental advancement at a
negligible cost to the landowner does not amount to a
regulatory taking. The Smiths' other claims are without
merit.
Accordingly, the order of the Appellate Division
should be affirmed, with costs.
Read, J. (dissenting). Today the maJonty decides
that the Fifth Amendment takings analysis of Nollan v
California Coastal Commn. (483 U.S. 825 [1987]) and
Dolan v City of Tigard (512 U.S. 374 [1994]) does not
apply to a permit condition compelling dedication of a
conservation easement. Because these decisions do not
admit of this result, I respectfully dissent.
I.
The eminent domain provision of the United States
Constitution, the Takings Clause of the Fifth
Amendment, provides that "private property [shall not]
be taken for public use, without just compensation." The
Fourteenth Amendment makes this constitutional
guarantee applicable to the states (see Penn Cent. Transp.
Co. v City of New York, 438 U.S. 104, 122 [1978], citing
Chicago, B. & Q.R. Co. v City of Chicago, 166 U.S. 226,
239 [ 1897]).
In Pennsylvania Coal Co. v Mahon (260 U.S. 393
[ 1922]), Justice Holmes acknowledged the difficulty of
distinguishing a proper exercise of police power from a
compensable taking: "Government hardly could go on if
to some extent values incident to property could not be
diminished without paying for every such change in the
general law" (id. at 413); and "[t]he general rule at least is
that while property may be regulated to a certain extent,
if regulation goes too far it will be recognized as a
taking" (id. at 415). Thus was born the concept at the
heart of this appeal--the regulatory takings
doctrine--which recognizes that government's exercise of
the police power to regulate private property, when it
goes "too far," so impairs property [4 N.Y.3d 16]
interests that the Fifth Amendment mandates just
compensation notwithstanding the absence of outright
appropriation.
When revisiting regulatory takings some 50 years
later in Penn Central, Justice Brennan remarked that
deciding whether a regulation had gone "too far" eluded
ready systemization:
"[T]his Court, quite simply, has been unable to
develop any 'set formula' for determining when justice
and fairness' require that economic injuries caused by
public action be compensated by the government, rather
than remain disproportionately concentrated on a few
persons. Indeed, we have frequently observed that
whether a particular restriction will be rendered invalid
by the government's failure to pay for any losses
proximately caused by it depends largely 'upon the
particular circumstances [in that] case'" (Penn Cent., 438
U.S. at 124 [citations omitted]).
He listed three factors bearing with "particular
significance" on "these essentially ad hoc, factual
inquiries": the regulation's economic impact on the
claimant; the extent to which the regulation interferes
with the claimant's "distinct, investment-backed
expectations"; and the character of the governmental
action (id. ). In short, the Court devised a balancing test.
Two years later when considering a facial challenge
to a municipal zoning ordinance, however, the Court in
A£Tins v Citv of Tiburon (447 U.S. 255 f19801) condensed
and reformulated the Penn Central factors into something
akin to a test: "[t]he application of a general zoning law
to particular property effects a taking if the ordinance
does not substantially advance legitimate state interests
[i.e., the character of the governmental action], or denies
an owner economically viable use of his land [i.e., the
regulation's economic impact on the claimant and the
extent of interference with distinct, investment-backed
expectations]" (id. at 260 [citation omitted]). After
devising this general rule for determining when a taking
has occurred, the Court marched down another path,
handing down several landmark cases that carved out
from the ambit of Penn Central/Agins specific rules for
analyzing three different kinds of regulatory takings.
In Loretto v Teleprompter Manhattan CATV Corp.
(458 U.S. 419 [1982]), the landlord purchased an
apartment building in which the prior owner had allowed
a cable company to install a cable [4 N.Y.3d 17] on the
building and to furnish cable television services to the
building's tenants, as mandated by state law. The landlord
filed a class action alleging that the installation--which, at
most, occupied only 1112 cubic feet of the landlord's
property--was a trespass and a taking without just
compensation. The Court held that even this minuscule
physical invasion required compensation regardless of an
adequate public purpose (see also Kaiser Aetna v United
States, 444 U.S. 164 [1979] [government's imposition of
navigational servitude upon a private marina is a physical
invasion for which just compensation must be paid]).
Thus, a regulation effecting an actual permanent physical
occupation of or intrusion on an owner's land or building
constitutes a per se regulatory taking.
In Lucas v South Carolina Coastal Council (505
U.S. 1003 [1992]), the Court considered the effect of a
coastal protection statute that barred a landowner from
building any permanent habitable structures on two beach
parcels for which he had paid $1 million, intending to
build one home for himself and one for sale. The Court
determined that this was the "rare" case where a
regulation denies a landowner all economically beneficial
use of his property, and therefore was a per se total
regulatory taking unless the state could prove that the
regulation, as applied, would prevent a nuisance or was
part of the state's background principles of property law.
In addition to the per se rules for physical takings
and total takings, the Court also devised a non-per se rule
for analyzing whether a taking has occurred in those
situations where the government seeks to require a
concession or "exaction" as a condition for approval of a
land-use permit. This is the so-called Nollan/Dolan rule,
which, in my view, so plainly calls for reversal in this
case.
The landowners in Nollan planned to demolish a
dilapidated bungalow on their beachfront property and
replace it with a three-bedroom house. They sought the
required discretionary permit from the California Coastal
Commission, which granted it subject to the Nollans'
dedication of an easement running across their property
laterally to the shore. This easement would provide a
beachfront passageway connecting the two public
beaches flanking the Nollans' property. The Commission
justified the easement on the grounds that the Nollans'
larger house would obstruct the public's visual access to
the beach, increase private use of the beach and burden
the public's ability to traverse to and along the shorefront.
[4 N.Y.3d 18] Justice Scalia observed at the outset
that "[h]ad California simply required the Nollans to
make an easement across their beachfront available to the
public on a permanent basis in order to increase public
access to the beach, rather than conditioning their permit
to rebuild their house on their agreeing to do so, we have
no doubt there would have been a taking" (483 U.S. at
831 ). The Court held that while a permit condition that
substantially advances a legitimate state interest is
constitutionally permissible, [I] this particular condition
violated the Takings Clause because there was no
"essential nexus" between the easement and the harm
created by the proposed development (id. at 837).
This point is well-illustrated by Justice Scalia's
description of the kind of easement that would have been
sufficiently closely linked to the loss of visual access
caused by the house's construction to pass muster under
the "essential nexus" test:
"Moreover (and here we come closer to the facts of
the present [Nollan] case), the condition would be
constitutional even if it consisted of the requirement that
the Nollans provide a viewing spot on [the Nollans']
property for passersby with whose sighting of the ocean
their new house would interfere. Although such a
requirement, constituting a permanent grant of
continuous access to the property, would have to be
considered a taking if it were not attached to a
development permit, the Commission's assumed power to
forbid construction of the house in order to protect the
public's view of the beach must surely include the power
to condition construction upon some concession by the
owner, even a concession of property rights, that serves
the same end. If a prohibition designed to accomplish that
purpose would be a legitimate exercise of the police
power rather than a taking, it would be strange to
conclude that providing the owner an alternative to that
prohibition which accomplishes the same purpose is not"
(id. at 836-837).
In Dolan, the Court addressed how much of an
exaction the government could require without running
afoul of the Takings Clause,
[4 N.Y.3d 19] an issue it did not reach in Nollan because
there the "essential nexus" was lacking. The property
owner in Dolan sought to raze and rebuild her plumbing
and electrical supply store. When she applied for site
development review, the city required her as a condition
of approval to dedicate a portion of her property to the
city for a greenway and expanded storm drain channel
and for a pedestrian/bicycle pathway to be built at her
expense.
The Court first determined that flood prevention
along the creek and the reduction of traffic in the business
district "qualify as the type of legitimate public purposes
[the Court has] upheld" (512 U.S. at 387 [citing Agins]).
Then the Court determined that there was an "essential
nexus" between the exactions and the harm created by the
development; namely, the flood plain dedication was
related to mitigating the extra stormwater runoff
anticipated from the additional building and paving
projects associated with the expansion, and the pathway
was related to the increased traffic that might be expected
from customers patronizing the larger store. These
exactions were nonetheless constitutionally
impermissible without just compensation because they
lacked the "rough proportionality" required "both in
nature and extent to the impact of the proposed
development" (512 U.S. at 391). Specifically, the city
was unable to say "why a public greenway, as opposed to
a private one, was required in the interest of flood
control" (id. at 393). With respect to the
pedestrian/bicycle pathway, the city failed to meet "its
burden of demonstrating that the additional number of
vehicle and bicycle trips generated by [the] development
reasonably relate to the city's requirement for a
dedication ofthe pedestrian/bicycle pathway easement";
the city had simply made a conclusory finding that "the
creation of the pathway 'could offset some of the traffic
demand ... and lessen the increase in traffic congestion' "
(id. at 395).
II.
The "development restriction" (majority op at 6) at
issue in this case is a conservation easement within the
meaning of the Environmental Conservation Law (see
ECL 49-0301--49-0311). Both the Town of Mendon and
amicus State of New York concede as much. A
conservation easement is a nonpossessory "interest in real
property" (ECL 49-0303 [I]), which imposes use
restrictions on the landowner for purposes generally of
"conserving, preserving and protecting" the State's
"environmental [4 N.Y.3d 20] assets and natural and
man-made resources" for the benefit of the public (ECL
49-0301 ). The majority is therefore simply wrong when it
asserts that the Town is not requiring a dedication of
property to public use by mandating that the Smiths grant
it a conservation easement, which is perpetual m
duration, runs with the land and is recorded.
Nor is it relevant (or even certain) that this particular
conservation easement may be worth little. The Town is
compelling the Smiths to convey an interest in real
property that the Town would otherwise have to pay for,
or which the Smiths might choose to donate for whatever
tax advantages they would enjoy as a result. [2] and of
course, the arguably trivial value of this particular
conservation easement is of no comfort to the next
landowner who seeks a development permit from the
government only to be met with a demand for what might
be a very valuable conservation easement as a condition
of approval. As we must always be aware, we are
establishing the rule that will govern not just this case,
but future cases.
The majority takes the view that a permit condition
is not an "exaction" unless it infringes on the property
owner's right to exclude others and/or mandates public
access. [3] Black's Law Dictionary defines an "exaction"
as"!. The act of demanding moremoney [4 N.Y.3d 21]
than is due; extortion. 2. A fee, reward, or other
compensation arbitrarily or wrongfully demanded"
(Black's Law Dictionary 600 [8th ed 2004]). More
colloquially, an exaction is "something exacted"; that
which is "call[ed] for forcibly or urgently and obtain[ed]"
(Merriam-Webster's Collegiate Dictionary 403 [lOth ed
1996]). Indeed, the majority seems to derive the notion
that public access is the sine qua non for an exaction not
from any commonly accepted definition, but from a gloss
on dictum in the Supreme Court's decision in City of
Monterey v Del Monte Dunes at Monterey, Ltd. (526 U.S.
687 [ 1999]).
Monterey concerned a developer seeking to build an
oceanfront multi-unit residential complex in an area
zoned for this use. The developer repeatedly scaled back
and revised its plans over the course of several years at
the instance of local authorities. When the city planning
commission and the city council ultimately rejected the
site plan, the developer brought a 42 USC § 1983 action
in federal District Court, alleging, among other things,
that the permit denial was an unconstitutional taking. A
jury delivered a general verdict for the developer on its
takings claim and awarded damages of $1.45 million. The
Ninth Circuit determined that the developer's inverse
condemnation claim was triable to a jury and upheld the
verdict.
The city's petition for certiorari presented multiple
questions to the Supreme Court, including whether the
Ninth Circuit erred in assuming that the
rough-proportionality standard of Nollan/Dolan applied.
On this question, all the Justices agreed that heightened
scrutiny under Nollan!Dolan applies only to exactions
and does not extend to decisions to deny applications for
discretionary approvals. Specifically, Justice Kennedy
commented that "we have not extended the
rough-proportionality test of Dolan beyond the special
context of exactions--land-use decisions conditioning
approval of development on the dedication of property to
public use" (526 U.S. at 702). The majority here, in
relying on this language, underscores the words
"dedication of property to public use," but the key word
is "conditioning." The Court distinguished Dolan and
Nollan from
[4 N.Y.3d 22]Monterey because in the former cases, a
development permit was conditioned on a land use
restriction, while in the latter there was no
conditioning--the permit was denied. In this case, site
plan approval was conditioned upon the granting of a
conservation easement. That is an exaction.
Nonetheless, the majority views the quoted language
from Monterey as having limited the Nollan/Dolan rule to
those land dedications that entail public access or
otherwise restrict the landowner's right to exclude. [4]
First, of course, the phrase "public use" does not
unambiguously equate with public access. Indeed, in
takings jurisprudence "public use" has come to mean
something more akin to a public purpose or public
benefit. [5] As already discussed, this conservation
easement is, in fact, a dedication of property to public
use. Its whole justification and purpose [4 N.Y.3d 23] is
to confer an environmental benefit on the public at large.
Further, while the Smiths retain the right to exclude the
general public from the easement area, the Town may
enter this area upon 30 days' notice to enforce the
easement, and may enter without any notice at all in the
event of a self-proclaimed emergency threatening the
public health, safety and general welfare.
Second, the language in Monterey on which the
majority so heavily relies is more properly read as merely
an acknowledgment of the nature of the exactions at issue
in Nollan and Dolan rather than a limitation of the Court's
Nollan/Dolan analysis to exactions that are land
dedications. Certainly there was no discussion in either
Nollan or Dolan to indicate that the Court viewed its
exaction analysis as so limited. If the Court had only
intended for Nollan/Dolan to create an exception from
the per se Loretto rule for those physical takings that are
permit conditions, it could have and surely would have
said this directly.
Further, before today we have never read
Nollan/Dolan so narrowly (see e.g. Manocherian v Lenox
Hill Hasp., 84 NY2d 385 [1994] [pre-Monterey case
applying Nol/an/Dolan to assess the validity of a statute
imposing occupancy restrictions on apartment building
owners]), or viewed it as subsequently limited by
Monterey to infringement of a property owner's right to
exclude. The majority explains our decision just last year
in Twin Lakes Dev. Corp. v Town of Monroe (I N.Y.3d
98 [2003]) as consistent with its decision today on the
ground that the per-lot recreation fees at issue there were
paid in lieu of dedication of property to public use. In
Twin Lakes, the parties agreed that Nollan/Dolan applied
to the exaction, but there is no indication that any
concession on this point or our acquiescence to it hinged
on the fact that the fees were exacted in lieu of a land
dedication. Impact fees such as the per-lot recreation fee
in Twin Lakes--charges in consideration of a
development's anticipated impacts on a community's
infrastructure and amenities, with the fees used to
mitigate these impacts--are often imposed as a condition
for development approvals. Does the majority mean to
suggest that such a fee is not an exaction for purposes of
takings analysis unless it is paid specifically in lieu of a
land dedication? I would guess that such a tum of events
might greatly surprise localities and developers
throughout the state, but it seems to be the clear
implication of today's decision.
[4 N.Y.3d 24] III.
As I understand the Supreme Court's takings
jurisprudence--through which I took a Cook's tour at the
beginning of this dissent--we are called upon first to
decide whether a claimed regulatory taking falls within
either of the categorical or per se rules (the Loretto rule
for physical takings and the Lucas rule for total takings)
or is a permit condition (Nollan/Dolan). For those
claimed takings outside the scope of these three rules,
Penn Central/Agins provides a default approach. [6]
Here, the Smiths sought site plan approval to build a
single-family house, and the Town conditioned its
approval on the Smiths' grant of a conservation easement
to the Town covering those portions of their 9.7-acre
parcel within the Town's EPODs. As a result, this case
falls squarely within Nollan!Dolan.
The reason proffered by the Town to justify the
easement is the "desire [ ] that certain portions of the
[Smiths'] property remain in their natural state in order to
preserve such environmentally significant areas." In my
view, this is a legitimate town interest that the
conservation easement would promote. As was the case
in Nollan, however, there is no "essential nexus" between
this exaction and the harm created by the proposed
development. The "proposed development" here was
merely the construction of a single-family house on land
not within an EPOD, and there is no suggestion in the
record that it would create any significant environmental
harm. On this appeal, the Town argues merely that there
is a "clear essential nexus between requiring a
conservation restriction and the legitimate town interest
of protecting environmentally sens1t1ve areas m
Mendon." But for purposes of Nollan/Dolan analysis, this
is (as I already indicated) merely a necessary but not a
sufficient predicate for the Town to establish that it may
require the conservation easement without making just
compensation. The Smiths' house does not encroach on
the EPODs; it simply happens to be located on the same
parcel of property. There has been no showing of any
relationship whatsoever between the construction or
occupancy of the Smiths' house and any environmental
harm to the EPODs that the conservation easement would
mitigate. As Justice Scalia has remarked, "[t]he object of
the Court's holding in Nollan and Dolan was to protect
against [4 N.Y.3d 25] the State's cloaking within the
permit process an out-and-out plan of extortion"
(Lambert, 529 U.S. at 1048, quoting Nollan, 483 U.S. at
837 [internal quotation marks and citation omitted]). That
the extortion may be somewhat gratuitous in this
case--the Town's EPOD regulations are currently at least
as restrictive as the terms of the conservation
easement--renders the extortion no less out of bounds.
Quoting the Attorney General, the majority correctly
points out that conservation easements have proven to be
a very popular and flexible tool for preserving land and
protecting our state's environment. [7] I have found
nothing to suggest, however, that the State has heretofore
ever been the beneficiary of a conservation easement
which was neither purchased [8] nor donated. As a result
of today's decision, the State and localities may compel
conveyance of conservation easements as a condition for
issuance of all sorts of routine permits, and, for purposes
of determining whether just compensation is due, these
conditions will not be subject to the heightened scrutiny
of Nollan/Dolan. This will no doubt come as unexpected
and unwelcome news to many New York property
owners.
Graffeo, J. (dissenting). We do not need to decide
whether heightened scrutiny under Dolan v City of Tigard
(512 U.S. 374 [1994]) applies to the facts of this case
because I believe the Town of Mendon's action effected a
taking even under the standard articulated in Agins v City
ofTiburon (447 U.S. 255 [1980]). Additionally, because
the condition imposed by the Town was not necessary to
mitigate any demonstrable effects of the site plan
proposal, I conclude the Town's determination was
arbitrary and capricious. I therefore respectfully dissent.
Paul and Janet Smith are the owners of9.7 acres of
undeveloped land that was part of a larger parcel owned
by Paul's family for over 50 years. Portions of their land
lie within four of the Town of Mendon's environmental
protection overlay districts (EPODs) under Mendon
Town Code § 200-23. The Town Code's EPOD [4
N.Y.3d 26] regulations place severe restrictions on
activities that may occur in EPODs, and development in
EPODs is prohibited unless the landowner first applies
for and obtains a special development permit from the
Town. The Smiths sought approval to build a
single-family home on their parcel. Although
construction of the Smiths' proposed home would not
encroach on any of these EPODs, the Town granted
approval of the site plan only on condition that the Smiths
agree to file a conservation restriction affecting the
EPODs. The restriction in large part mirrors the
regulations already imposed under the EPOD ordinance
but provides that it will exist in perpetuity. The Town
reasoned that such a restriction "will provide the most
meaningful and responsible means of protecting the
environmental resources" located in the EPOD portions
of the Smiths' lot.
The issue before us 1s whether the Town's
imposition of the development restriction as a condition
to granting site plan approval effects a regulatory taking
under the Fifth and Fourteenth Amendments to the
United States Constitution. Under Agins, a regulatory
action may effect a taking where it "does not substantially
advance legitimate state interests" (Agins, 447 U.S. at
260). Put another way, "a use restriction on real property
may constitute a 'taking' if not reasonably necessary to
the effectuation of a substantial public purpose" (Penn
Cent. Transp. Co. v City of New York, 438 U.S. 104, 127
[ 1978]). Although it has been intimated that the
regulatory action need only bear a reasonable relationship
to a legitimate governmental purpose (see City of
Monterey v Del Monte Dunes at Monterey, Ltd., 526 U.S.
687, 701, 721 [1999]), the United States Supreme Court
has rejected the notion that the "substantially advance"
standard simply means that "the State could rationally
have decided that the measure adopted might achieve the
State's objective" (Nollan v California Coastal Commn.,
483 U.S. 825, 834 n 3 [ 1987] [citations and internal
quotation marks omitted]). Furthermore, it has long been
established that the issue of whether a taking has
occurred "depends largely 'upon the particular
circumstances [in that] case' " (Penn Cent., 438 U.S. at
124, quoting United States v Central Eureka Min. Co.,
357 u.s. 155, 168 [1958]).
The Town proffers three reasons why the restriction
substantially promotes its valid goal of preserving the
environment. I cannot conclude that the reasons offered
by the Town substantially or even reasonably further
legitimate governmental interests not already protected
by the existing EPOD regulations.
[4 N.Y.3d 27] First, the Town claims that the
conservation restriction, which is to be filed similar to a
deed, "is intended to put subsequent buyers on notice that
the property contains constraints which may limit
development within these environmentally sensitive areas
of the site." Pursuant to the Town's EPOD regulations,
however, the locations of all EPOD sites within the Town
are delineated on an official set of maps on file with the
Town. Subsequent purchasers are therefore already on
constructive notice that the Smiths' property contains
EPODs and is subject to the limitations currently in place
pursuant to the Town Code, which the proposed
conservation restriction largely follows. Hence, the
restriction does not in any meaningful way advance a
necessary public notice purpose.
Second, the Town asserts that the conservation
restnctwn strengthens the available enforcement
mechanisms, particularly the ability of the Town to seek
injunctive relief. Even without the restriction, it is well
settled that the Town could seek to enjoin any activity on
the property which is violative of land-use regulations
(see Town Law § 268 [2]; Town ofThroop v Leema
Gravel Beds, 249 A.D.2d 970, 971-972 [1998]; see also
City of New York v Village ofTannersville, 263 A.D.2d
877, 879 [1999]). Therefore, in my opinion, the
restriction does not promote additional environmental
interests not already addressed by the existing EPOD
designations.
Finally, the Town contends that the restriction will
inhibit activity on the EPODs in perpetuity, whereas the
EPOD ordinance could change at any time. This is true,
but it does not provide a legitimate basis for imposition of
the restriction. If the Town decides to repeal its EPOD
ordinance with respect to one or more of the EPODs
situated on the Smiths' land, presumably it would do so
because it no longer considers the designation of
environmental restrictions on that type of property to be
necessary or in the public interest. If restrictions were no
longer in the public interest, the Town would have no
valid basis for continuing them in perpetuity. Yet, under
this scenario, portions of the Smiths' property would still
be encumbered by the conservation restriction while
other EPOD-burdened parcels would be released from the
restrictions on development--a result that would be
neither reasonable nor fair.
In the end, it is the Town's generally applicable
EPOD ordinance itself--whose proviSIOns the
development restriction tracks--that substantially
promotes the Town's valid interest in protecting [4
N.Y.3d 28] the environment. If this case involved a claim
that the Town Code's EPOD regulations effected a taking
of property, clearly such a challenge would fail under
Agins because the restrictions contained in those rules
substantially promote environmental interests. But the
added layer of regulation sought to be imposed by the
Town through the ad hoc imposition of a conservation
restriction as a condition to site plan approval does not
further additional legitimate environmental concerns in a
meaningful way and is simply overkill. To hold otherwise
effectively permits municipalities to single out particular
EPOD-affected landowners for double regulation. In sum,
I conclude that the Town's imposition of the conservation
restriction without just compensation amounted to an
unconstitutional taking.
Even if the conservation restriction does not effect a
taking as the majority holds, I would still rule in favor of
the Smiths because the Town's determination to demand
such a condition in exchange for site plan approval was,
contrary to the conclusion of the courts below, arbitrary
and capricious. Although a municipality may place
conditions on the approval of site plans, such authority is
not limitless. Under Town Law § 274-a (4), conditions
and restrictions must be "reasonable" and "directly
related to and incidental to a proposed site plan." We
have held that conditions are proper when they constitute
"corrective measures designed to protect neighboring
properties against the possible adverse effects of [a
proposed] use" (Matter of St. Onge v Donovan, 71 NY2d
507, 516 [ 1988]). In contrast, conditions are invalid when
"they do not seek to ameliorate the effects of the land use
at issue" (id. at 517). Accordingly, courts have repeatedly
held that a municipality's imposition of a condition which
is "not reasonably designed to mitigate any demonstrable
defects" is arbitrary and capricious (Matter of Clinton v
Summers, 144 A.D.2d 145, 147 [1988]; see also Matter
of Castle Props. Co. v Ackerson, 163 A.D.2d 785,
786-787 [1990]; Matter of Black v Summers, 151 A.D.2d
863, 865 [ 1989]). Where a court determines that the
imposition of a condition is arbitrary and capricious, the
appropriate relief is to excise the condition (see Matter of
St. Onge, 71 NY2d at 519).
Here, pursuant to the State Environmental Quality
Review Act, the Town issued a negative declaration,
finding that the Smiths' proposed site project would not
result in any significant adverse environmental impacts
so long as the development did not occur in any of the
EPODs. The Town does not dispute that the [4 N.Y.3d
29] Smiths' proposed single-family dwelling would not
have an effect on any of the EPODs, and the Smiths have
maintained that they intend to comply with the
requirements of the Town's EPOD ordinance. The Town's
stated basis for imposing the conservation restriction was
"to mitigate any potentially significant adverse
environmental impact upon the site or upon adjacent
sites." Yet, under the Town's own findings, the proposed
site plan would not cause any environmental detriments
that needed to be mitigated. As such, it is evident that the
restriction should have been invalidated because it was
not necessary "to mitigate any demonstrable defects" and
was therefore arbitrary and capricious (see Matter of
Clinton, 144 A.D.2d at 147).
For the reasons stated, I would reverse the order of
the Appellate Division and grant the petition with respect
to the Smiths' second and third causes of action.
Chief Judge Kaye and Judges G.B. Smith and
Ciparick concur with Judge Rosenblatt; Judge Read
dissents and votes to reverse in a separate opinion in
which Judge R.S. Smith concurs; Judge Graffeo dissents
and votes to reverse in another opinion.
Order affirmed, with costs.
Notes:
[I] In addition, the Smiths also sought a judgment
declaring that the conservation restriction was, as a
matter of law, a conservation easement under ECL
49-0303 (!). They also alleged that the Board's decision
to condition final site plan approval on their acceptance
of the conservation restriction was arbitrary and
capricious, and sought attorneys' fees pursuant to Town
Law § 282. That section permits a court to award costs to
a person or persons aggrieved by a planning board
decision if it "shall appear to the court" that the board
"acted with gross negligence or in bad faith or with
malice in making the decision appealed from."
[2] The Takings Clause of the Fifth Amendment is
applicable to the states through the Fourteenth
Amendment (see Chicago, B. & Q.R. Co. v City of
Chicago, 166 U.S. 226 [1897]).
[3] (See Palazzolo v Rhode Island, 533 U.S. 606, 617
[2001] [discussing the evolution of takings
jurisprudence]; see also Loretto v Teleprompter
Manhattan CATV Corp., 458 U.S. 419 [1982].)
[ 4] (City of Monterey v Del Monte Dunes at Monterey,
Ltd., 526 U.S. 687, 720 [1999]; see also Palazzolo, 533
U.S. at 617; Lucas v South Carolina Coastal Council,
505 U.S. 1003, 1019 [1992] ["when the owner of real
property has been called upon to sacrifice all
economically beneficial uses in the name of the common
good, that is, to leave his property economically idle, he
has suffered a taking"].)
[5] (Palazzolo, 533 U.S. at 617; see also Penn Cent.
Transp. Co. v City of New York, 438 U.S. 104 [1978].)
[6] In spite of their differing language, the Supreme Court
has employed the Agins test and Penn Central standard,
which the Court invoked in Palazzolo, interchangeably
(see e.g. Lucas v South Carolina Coastal Council, 505
US 1003, 1024 [1992]; Keystone Bituminous Coal Assn.
v DeBenedictis, 480 U.S. 470, 485 [1987]).
[7] Because the Town's conservation restriction cannot be
classified as an exaction, we need not address the
question whether it was roughly proportional to the
impact of the development proposed by the Smiths.
[8] Judge Read suggests that the conservation restriction
here somehow encumbers the right to exclude because it
permits town inspectors to enter the property on 30 days'
written notice or in the event of an emergency threatening
the public's health, safety or welfare (see Read, J.,
dissenting op at 23). On the facts of this case, we fail to
see how the Town's right to enter the Smiths' land under a
sharply circumscribed set of circumstances to enforce a
set of valid regulations impairs the right to exclude or
represents a departure from the Town's ordinary exercise
of its police powers.
[9] Although the conservation restriction may, as Judge
Read suggests, require the dedication of a possessory
interest (see Read, J., dissenting op at 19-20), "property"
is constituted by many possessory interests, some of
which (e.g., the rights to exclude and alienate) are more
central to commonly held understandings of property
than others. The Supreme Court's exactions jurisprudence
tracks this conception of property. In Nollan and Dolan,
the Supreme Court applied the idea of "exaction" only to
the required dedications of a core possessory interest, the
right to exclude. As the Attorney General observes,
"[b]oth cases hinged on the owners' loss of perhaps the
most important 'stick' from the ownership bundle: the
ability to restrict access" (Attorney General's brief at
12-13). Notably, the Supreme Court has never extended
its exactions analysis to the dedication of less substantial
possessory interests, like those at issue here. Thus, the
Appellate Division correctly determined that the
conservation restriction is not an exaction within Nollan
and Dolan, and we are unwilling to expand the holdings
of those decisions to the case before us.
[I 0] Judge Read mistakenly argues that there is
something extraordinary or improper about the Town's
exercise of its police powers here. We disagree. The case
before us today concerns only a marginal use restriction
superimposed over a wholly legitimate, preexisting
EPOD ordinance. There is nothing here that implicates
the Fifth Amendment's concern with "forcing some
people alone to bear public burdens which, in all fairness
and justice, should be borne by the public as a whole"
(Armstrong v United States, 364 U.S. 40, 49 [1960]).
[II] (See also Lucas v South Carolina Coastal Council,
505 U.S. 1003 [1992] [holding that a deprivation of "all"
economically viable uses of a property works a taking].)
[12] We note that the Supreme Court has been reluctant
to engage in spatial "conceptual severance" in
determining whether a regulation or government action
deprives a property owner of all economically viable uses
of the property (District 1ntown Props. Ltd. Partnership v
District of Columbia, 198 F3d 874, 887 [DC Cir 1999]).
Hence, we look to the effect of the government action on
the value of the property as a whole , rather than to its
effect on discrete segments of the property (see Penn
Cent. Transp. Co. v City of New York, 438 U.S. 104,
130-131 [ 1978] [" 'Taking' jurisprudence does not divide
a single parcel into discrete segments and attempt to
determine whether rights in a particular segment have
been entirely abrogated. In deciding whether a particular
governmental action has effected a taking, this Court
focuses rather both on the character of the action and on
the nature and extent of the interference with rights in the
parcel as a whole"]; see also Keystone Bituminous Coal
Assn. v DeBenedictis, 480 U.S. 470, 497 [1987]). Here,
the conservation restriction, while reinforcing the
preexisting devaluation of a portion of the Smiths'
property, does not begin to deny them all economically
viable uses of the entire parcel.
[13] (See also City of Monterey v Del Monte Dunes at
Monterey, Ltd., 526 U.S. 687,701,721 [1999] [observing
that the trial court correctly instructed the jury that
"substantially advances" was equivalent to "reasonable
relationship"]; Hotel & Motel Assn. of Oakland v City of
Oakland, 344 F3d 959, 968 [9th Cir 2003] ["A reasonable
relationship exists between this regulatory action and the
public purpose it is meant to serve. Thus, the ordinance
substantially advances a legitimate government
interest."].)
[I] The Court "assume[ d) without deciding" that the
purposes proffered by the Commission to justify the
exaction--"protecting the public's ability to see the beach,
assisting the public in overcoming the 'psychological
barrier' to using the beach created by a developed
shorefront, and preventing congestion on the public
beaches"--were legitimate state interests (483 U.S. at
835).
[2] Section 170 (h) of the Internal Revenue Code (26
USC) provides for a charitable deduction for a qualifying
conservation easement. The easement must be
contributed to a public body or qualified nonprofit
organization exclusively for conservation purposes to be
protected in perpetuity (26 CFR 1.170A-14 [a], [b] [2];
[ c ]). Depending upon the nature of the easement's
conservation purposes, public access may be mandated,
or it may be partially or wholly restricted (see e.g. 26
CFR 1.170A-14 [d] [2] [ii] [public access required for
conservation easement for recreation and education]; [d]
[3] [iii] [restrictions on public access to protected
environmental systems]; [d] [4] [ii] [B] [visual rather
than physical access sufficient to satisfy requirement of
scenic enjoyment of open space by general public]).
Section 2031 (c) of the Internal Revenue Code grants
substantial estate tax benefits to a qualifying conservation
easement. In addition, the restrictions placed on property
by a conservation easement may reduce market value so
as, in tum, to reduce assessed value and therefore real
property taxes. As one commentator has noted, however,
"local assessors are often reluctant to reduce assessments"
on account of conservation easements and "[i]n many
instances the cost of pursuing legal remedies may exceed
the potential benefits of the possible tax reduction"
(Ginsberg and Weinberg, Environmental Law and
Regulation in New York§ 12:6, at 1081, 1082 [9 West's
NY Prac Series 200 I]).
[3] In essence, the majority has adopted the positions
advocated by amicus State ofNew York and the Town.
The State argues that an exaction is limited to a physical
taking or a physical invasion. Likewise, the Town argues
that an easement is not an exaction unless it provides for
the general public's or the Town's physical use or
occupation of the property. In a related vein, both the
State and the Town emphasize that the conservation
easement here is a negative easement that prohibits the
landowner from doing something otherwise lawful on his
estate. of course, to the extent that the easement mirrors
the Town's environmental protection overlay district
(EPOD) regulations, the easement only prohibits the
Smiths from doing that which the law now already bans.
The Town takes the position that a negative easement
may never be an exaction while an affirmative easement,
which grants the easement holder the right to use the
servient estate, may be.
[4] The language's author, Justice Kennedy, does not
appear to agree with this interpretation of what he wrote.
In Lambert v City & County of San Francisco (529 U.S.
1045 [2000]), he and Justice Thomas joined Justice
Scalia's dissent from a denial of certiorari to consider
whether Nollan/Dolan applies to the denial of a permit
because an exaction is not met. In this case, the exaction
was a replacement fee for conversion of apartments.
Justice Scalia summarized the holdings in Nollan/Dolan
as follows, making no reference whatsoever to public
access: These decisions "held that a burden imposed as a
condition of permit approval must be related to the public
harm that would justify denying the permit, and must be
roughly proportional to what is needed to eliminate that
harm" (529 U.S. at I 046). Further, in Ehrlich v City of
Culver City (512 U.S. 1231 [1994]), handed down three
days after Dolan, the Court by a 5-4 margin vacated the
judgment and remanded for further consideration in light
of Dolan. In Ehrlich, the owner of a sports complex
required the City's approval to construct a condominium
on the site to replace the sports complex. The City
conditioned approval upon the property
owner/developer's payment of a recreational fee and a fee
in lieu of participating in the City's "Art in Public Places
Program." Upon remand, the California Supreme Court
specifically "reject[ ed] the city's contention that the
heightened takings clause standard formulated by the
court in Noll an and Dolan applies only to cases in which
the local land use authority requires the developer to
dedicate real property to public use as a condition of
permit approval" (12 Cal 4th 854, 859, 911 P.2d 429, 433
[ 1996], cert denied 519 U.S. 929 [ 1996]).
[5] As the eminent constitutional scholar Cass Sunstein
has succinctly explained: "For a long period, the public
use requirement [of the Takings Clause] was understood
to mean that if property was to be taken, it was necessary
that it be used by the public. That the new use was in
some sense beneficial to the public was insufficient.
Eventually, however, it became clear that this test was
unduly mechanical, for a wide range of uses by
government served the public at large, even if the public
did not actually have access to the property. The Mill
Acts, which permitted riparian owners to erect and
maintain mills on neighboring property, provided an
example. After the courts upheld those acts, exceptions
were built into the general rule until the general rule itself
was abandoned" (Sunstein, Naked Preferences and the
Constitution, 84 Colum L Rev 1689, 1724 [1984]).
[ 6] In this respect, I undertake the analysis in a reverse
order than does Judge Graffeo except, of course, to the
extent that the first question under Nollan/Dolan is
whether the permit seeks to promote a legitimate state
purpose, which derives from Agins.
[7] There are, however, those who view the merits of
conservation easements more skeptically (see e.g.
Mahoney, Perpetual Restrictions on Land and the
Problem of the Future, 88 VaL Rev 739 [2002]).
[8] Moneys have been expended from the 1986 bond act,
the New York State Open Space Plan and the
environmental protection fund to purchase conservation
easements (see Bathrick, Symposium: 25th Anniversary
of the New York State Department of Environmental
Conservation: Past and Future Challenges and Directions,
Resource Management: Lands & Forests, 7 Alb LJ Sci &
Tech 159, 167 [1996]).
OFFICE RECEPTIONIST, CLERK
To: Jana Marks
Cc: amyv@sanjuanco.com; dionnep@atg.wa.gov; bth@pacificlegal.org;
elizabethh@sanjuanco.com
Subject: RE: E-filing in Case NO. 92251-9 by FRIENDS of the San Juans
Received 11-2-15
Supreme Court Clerk's Office
Please note that any pleading filed as an attachment to e-mail will be treated as the original. Therefore, if a filing is byemail attachment, it is not necessary to mail to the court the original of the document.
From: Jana Marks [mailto:jana@sanjuans.org]
Sent: Monday, November 02, 2015 3:43 PM
To: OFFICE RECEPTIONIST, CLERK <SUPREME@COURTS.WA.GOV>
Cc: amyv@sanjuanco.com; dionnep@atg.wa.gov; bth@pacificlegal.org; elizabethh@sanjuanco.com
Subject: E-filing in Case NO. 92251-9 by FRIENDS of the San Juans
Dear Supreme Court Clerk,
Please accept for electronic filing the attached CROSS-ANSWER TO CROSS-PETITION FOR REVIEW with Appendix A and
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Jana Marks
360-378-2319
jana@sanjuans.org
Sincerely, Jana Marks
Jana \larks
Program Assistant
FR!l:'\DS of the San .Juans
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No. 68339-0-I
IN THE COURT OF APPEALS
OF THE STATE OF WASHINGTON
DIVISION I
STACEY DEFOOR,
Appellant,
V.
RAFEL LAW GROUP PLLC
Respondent.
Appeal From The Superior Court For King County
Hon. Mary Yu
REPLY BRIEF OF APPELLANT STACEY DEFOOR
DWT 2058029lv5 0089090-000003
DAVIS WRIGHT TREMAINE LLP
Roger Leishman, WSBA No. 19971
Zak Tomlinson, WSBA No. 35940
1201 Third Avenue, Suite 2200
Seattle, Washington 98101-3045
Telephone: (206) 622-3150
Facsimile: (206) 757-7700
E-mail: rogerleishman@dwt.com
Attorneys for Appellant Stacey Defoor
TABLE OF CONTENTS
I. INTRODUCTION .......................................................................... 1
II. ARGUMENT .................................................................................. 2
A. Because Rafel Violated RPC 1.8, The Settlement &
Re-Engagement Agreement Is Void As A Matter of
Law ..................................................................................... 2
1. The Settlement and Note Provisions Regarding
RLG's Matter 1 Fee Demand Violated
RPC 1.8(a) ............................................................... 2
a. Converting a doubtful quantum meruit
claim into a $775,000 promissory note in
return for providing future legal services
is a "business transaction" covered by
RPC 1.8( a) ................................................... 2
b. Rafel did not comply with RPC 1.8(a) ........ 5
2. RLG Does Not Dispute That Rafel Violated
RPC 1.8(a) By Acquiring A Security Interest In
"Any Assets Of Defoor." ......................................... 8
3. Because Rafel Violated RPC 1.8, RLG May
Not Enforce The Agreement Against Defoor ......... 9
4. RLG's Unfounded Fraud Accusations Do Not
Excuse Rafel' s Professional Misconduct.. ............ 1 0
B. Disputed Factual Issues Preclude Summary
Judgment On Defoor's Malpractice Claim ....................... 11
1. Rafel Breached His Duty of Care by Failing to
Track the Proceeds From Community
Transactions .......................................................... 12
2. Rafel's Breach of Duty Was the Proximate
Cause of Damage to Defoor .................................. 17
C. Disputed Factual Issues Preclude Summary
Judgment On Defoor's Breach Of Fiduciary Duty
Claim ................................................................................. 21
-1-
DWT 20580291 v5 0089090-000003
D. Disputed Factual Issues Preclude Summary
Judgment As To The Fairness And Reasonableness
OfRLG's $1,747,567 Fee Claim ...................................... 22
III. CONCLUSION ............................................................................. 25
-11-
DWT 2058029lv5 0089090-000003
TABLE OF AUTHORITIES
Page(s)
CASES
Aloy v. Mash,
696 P .2d 656 (Cal. 1985) .............................................................. .12, 18
Ausler v. Ramsey,
73 Wn. App. 231,868 P.2d 877 (1994) ................................................. 2
Baca v. Chiropractic v. Cobb,
317 S.W.3d 674 (Mo. App. 2010) ................................................ .23, 25
Ball v. Posey,
176 Cal. App. 3d (1986) ...................................................................... 23
Ballesteros v. Jones,
985 S.W.2d 485 (Tex. App. 1999) ....................................................... 12
Behr v. Foreman,
824 So.2d 222 (Fla. App. 2002) ........................................................... 20
Berger v. Sonneland,
144 Wn.2d 91,26 P.3d 257 (2001) ...................................................... 21
Bowers v. Transamerica Title Ins. Co.,
100 Wn.2d 581,675 P.2d 193 (1983) ............................................ 23, 24
Brown v. State Farm Fire & Cas. Co.,
66 Wn. App. 273, 831 P.2d 1122 (1992) ............................................ .23
Brygider v. Atkinson,
385 S.E.2d 95 (1989) ........................................................................... 24
Callahan v. Clark,
901 S.W.2d 842 (Ark. 1995) ................................................................ 18
City of Birmingham v. Horn,
810 So.2d 667 (Ala. 2001) .................................................................. .23
Cooper v. Baer,
59 Wn.2d 763,380 P.2d 871 (1962) .................................................... 11
-lllDWT 20580291 v5 0089090-000003
Corp. Dissolution of Ocean Shores Park, Inc. v. Rawson-Sweet,
132 Wn. App. 903, 134 P.3d 1188 (2006) .......................................... .11
Cotton v. Kronenberg,
111 Wn. App. 258, 44 P.3d 878 (2002) ..................................... 3, 4, 5, 6
Dailey v. Testone,
72 Wn.2d 662,435 P.2d 24 (1967) ...................................................... 24
Daugert v. Pappas,
104 Wn.2d 254, 704 P .2d 600 (1985) .................................................. 18
Ehlinger v. Ruberti, Girvin & Ferlazzo,
758 N.Y.S.2d 195 (A.D. 2003) ............................................................ 20
Eriks v. Denver,
118 Wn.2d 451, 824 P .2d 1207 (1992) ............................................... .24
Feng v. Kelley & Ferraro,
2009 WL 790345 (Ohio App. Mar. 26, 2009) ............................... 12, 18
Geer v. Tonnon,
137 Wn. App. 838,155 P.3d 163 (2007) ............................................. 23
Grayson v. Woftey, Rosen, Kweskin & Kuriansky,
646 A.2d 195 (Conn. 1994) ........................................................... 12, 18
Guenard v. Burke,
443 N.E.2d 892 (Mass. 1982) ........................................................ 12, 18
Guity v. C.C.l Enter.,
54 S.W.3d 526 (Tex. App. 2001) .................................................. .23, 24
Hart v. Carro, Spanbock, Kaster & Cuiffo,
620 N.Y.S.2d 847 (A.D. 1995) ........................................................... .20
Head v. Hargrave,
105 u.s. 45 (1881) ............................................................................... 23
Helmbrecht v. St. Paul Ins. Co.,
362 N.W.2d 118 (Wis. 1985) ......................................................... 12, 18
-IVDWT 2058029lv5 0089090-000003
Hinkle, et al. v. Cadle Co.,
848 P .2d 1 079 (N .M. 1993) ................................................................. 24
Holmes v. Loveless,
122 Wn. App. 470, 94 P.3d 338 (2004) ................................................. 3
Home Realty Lynwood, Inc. v. Walsh,
146 Wn. App. 231, 189 P.3d 253 (2008) ............................................... 8
In re Disciplinary Proceeding Against Haley,
157 Wn.2d 398, 138 P.3d 1044 (2006) .................................................. 5
In re Disciplinary Proceeding Against McKean,
148 Wn.2d 849, 64 P.3d 1226 (2003) .................................................... 7
In re Marriage of McCausland,
129 Wn. App. 390, 118 P.3d 944 (2005) ............................................. 10
Ishmael v. Millington,
241 Cal. App. 2d 520 (1966) ........................................................ .12, 18
Jacob's Meadow Owners Ass 'n v. Plateau, 44 IL LLC,
139 Wn. App. 743, 162 P.3d 1153 (2007) ........................................... 22
Jacqeline 's Washington, Inc. v. Merchantile Stores Co.,
80 Wn.2d 784,498 P.2d 870 (1972) ................................................... .20
Kloepfel v. Bokor,
149 Wn.2d 192,66 P.3d 630 (2003) ................................................... .21
Kluczka v. Lecci,
880 N.Y.S.2d 698 (A.D. 2009) ........................................................... .24
Landau v. Bailey,
629 N .E.2d 264 (Ind. App. 1994) ........................................................ 12
Lavigne v. Chase, Haskell, Hayes & Kalamon,
112 Wn. App. 677,50 P.3d 306 (2002) ................................... 17, 18, 19
Lewis v. Superior Court,
77 Cal. App. 3d 844 ( 1978) ................................................................. 18
-vDWT 20580291 vS 0089090-000003
LK Operating, LLC v. Collection Grp, LLC,
168 Wn. App. 862, 279 P.3d 448 (2012) ......................................... 9, 10
London v. Weitzman,
884 S.W.2d 674 (Mo. App. 1994) ................................................. 12, 18
Lundgren v. Whitney's Inc.,
94 Wn.2d 91,614 P.2d 1272 (1980) .................................................... 20
MacNaughton v. NBF Cable Sys., Inc.,
1996 WL 33703873 (D. N.J. June 18, 1996) ...................................... .22
Mahler v. Szucs,
135 Wn.2d 398, 957 P.2d 632 (1998) ............................................ 22, 24
Margolin v. Kleban & Samar, P. C.,
882 A.2d 653 (Conn. 2005) ................................................................ .20
Martin v. Northwest Wa. Legal Servs.,
43 Wn. App. 405,717 P.2d 779 (1986) ......................................... 12, 18
McClung v. Smith,
870 F.Supp. 1384 (E.D. Va. 1994) ..................................................... .12
McDonald v. Paine,
810 P.2d 259 (Idaho 1991) ................................................................... 12
McWhirt v. Heavey,
550 N.W.2d 327 (Neb. 1996) ......................................................... 12, 18
Meyer v. Wagner,
784 N.E.2d 34 (Mass. App. 2003) ................................................. 18, 20
Millsaps v. Kaufold,
653 S.E.2d 344 (Ga. App. 2007) .................................................... 18, 20
Morris v. Morris,
2003 WL 21509023 (Ohio App. July 2, 2003) .................................... 19
Nembach v. Giaimo & Vreeburg,
618 N.Y.S.2d 307 (A.D. 1994) ..................................................... .12, 18
-VlDWT 2058029Iv5 0089090-000003
0 'Conner v. Blodnick, Abramowitz & Blodnick,
744 N.Y.S.2d 205 (A.D. 2002) ............................................................ 23
Oakes & Kanatz v. Schmidt,
391 N.W.2d 51 (Minn. App. 1986) ...................................................... 12
Park v. Park,
612 P.2d 882 (Cal. 1980) ..................................................................... 12
Peterson v. Simasko, Simasko & Simasko,
579 N.W.2d 469 (Mich. App. 1998) .................................................... 20
Pickett, Houlon & Berman v. Haislip,
533 A.2d 287 (Md. App. 1987) ............................................................ 12
Reed v. Mitchell & Timbanard,
903 P .2d 621 (Ariz. App. 1995) ........................................................... 20
Rhine v. Haley,
378 S.W.2d 655 (Ark. 1964) ................................................................ 20
Rino v. Mead,
55 P.3d 13 (Wyo. 2002) ....................................................................... 12
Ross v. Scannell,
97 Wn.2d 598,647 P.2d 1004 (1982) ................................................ 2, 8
Saffer v. Willoughby,
670 A.2d 527 (1996) ............................................................................ 24
Schneider v. Richardson,
411 A.2d 656 (Me. 1979) .................................................................... .12
Scott Fetzer Co. v. Weeks,
122 Wn.2d 141,859 P.2d 1210 (1993) ............................................... .22
Shoemake v. Ferrer,
143 Wn. App. 819, 182 P.3d 992 (2008) ............................................. 24
Simburg, eta/., v. Olshan,
97 Wn. App. 901, 988 P. 2d 467 (1999) ................................................ 7
- VllDWT 20580291 v5 0089090-000003
Sobilo v. Manassa, Riffner, Barber, Rowden & Scott,
479 F. Supp. 2d 805 (N.D. Ill. 2007) .................................................. .20
Stanley v. Richmond,
35 Cal. App. 4th 1070 (1995) ........................................................ 13, 18
Stephen v. Sallaz & Gatewood,
248 P.3d 1256 (Idaho 2011) ................................................................. 12
Tarleton v. Arnstein & Lehr,
719 So.2d 325 (Fla. App. 1998) ............................................... 12, 18, 19
Tennen v. Lane,
716 P.2d 1031 (Ariz. App. 1986) ......................................................... 18
Teodorescu v. Bushnell, Gage, Reizen & Byington,
506 N.W.2d 275 (Mich. App. 1993) ............................................. .12, 18
Valley/50th Ave., LLC v. Stewart,
159 Wn.2d 736, 153 P.2d 186 (2007) .................................................... 3
Versuslaw, Inc. v. Stoel Rives, LLP,
127 Wn. App. 309, Ill P.3d 866 (2005) ............................................ .18
Verve, LLC v. Hypercom Corp.,
2006 WL 3385797 (D. Ariz. Oct. 19, 2006) ....................................... .23
Wolfe v. Morgan,
11 Wn. App. 738, 524 P.2d 927 (1974) .............................................. .22
Wood v. McGrath, North, Mullin & Kratz,
589N.W.2d 103 (Neb. 1999) ............................................................... 12
Ziegelheim v. Apollo,
607 A.2d 1298 (N.J. 1992) ................................................................... 12
STATUTES AND RULES
CR 30(b)(6) ................................................................................................ 10
RCW 64.04.010 ........................................................................................... 8
- VlllDWT 20580291 v5 0089090-000003
RPC 1.5 ........................................................................................................ 1
RPC 1.5(a)(4) ............................................................................................. 24
RPC 1.8 .............................................................................................. passim
RPC 1.8(a) .......................................................................................... passim
RPC 1.8(a)(1) ........................................................................................... 5, 6
RPC 1.8(a)(2) ............................................................................................... 6
RPC 1.8(t) .................................................................................................... 4
RPC 1.8(i) ................................................................................................ 4, 8
RPC 1.8 cmt 1 .......................................................................................... 1, 4
RPC 1.8 cmt 4 .............................................................................................. 6
RPC 1.8 cmt 16 ............................................................................................ 8
OTHER AUTHORITIES
Andrews et al., LAW OF LAWYERING IN WASHINGTON ........................... .4, 9
Hazard, et al., THE LAW OF LAWYERING .................................................... .4
RESTATEMENT OF LAWYERING ................................................................... 25
WSBA Ethics Adv. Op. 2178 (2008) ...................................................... .4, 9
-IXDWT 20580291 v5 0089090-000003
I. INTRODUCTION
The Rules of Professional Conduct protect clients and the public
from overreaching attorneys. In this case, the Settlement & Re-Engagement
Agreement between Stacey Defoor and Rafel Law Group did not merely
create an "ordinary fee arrangement[] between client and lawyer" that would
be governed by Rule 1.5, but instead included both a "business transaction"
and a "security" interest. RPC 1.8 & cmt 1. Rafel therefore had a duty to
make the disclosures required by RPC 1.8(a) at the outset of the
representation. He did not. As a result ofRafel's violation ofRPC 1.8, the
Agreement is void as a matter of law. This Court should reverse the trial
court's orders granting RLG's motion for summary judgment of validity and
denying Defoor's cross-motion, and should remand for entry of a judgment
invalidating the Agreement and awarding attorney's fees to Defoor.
Because the Agreement is void, it is unnecessary to reach the trial
court's ruling that RLG is entitled to a total of $2,027,316 for services, costs,
fees, and interest. In any event, disputed factual issues preclude summary
adjudication of both the fairness and reasonableness ofthis amount.
Disputed issues of fact also bar summary judgment on Defoor's two
counterclaims. This Court should reverse and remand for trial of Defoor's
counterclaims, together with RLG's claim for the quantum meruit value of
RLG's services in each matter calculated in light ofRafel's misconduct.
DWT 20580291 vS 0089090-000003
II. ARGUMENT
A. Because Rafel Violated RPC 1.8, The Settlement &
Re-Engagement Agreement Is Void As A Matter of Law.
1. The Settlement and Note Provisions Regarding RLG's
Matter 1 Fee Demand Violated RPC 1.8(a).
a. Converting a doubtful quantum meruit claim into a
$775,000 promissory note in return for providing
future legal services· is a "business transaction"
covered by RPC 1.8( a).
RLG begrudgingly acknowledges that before Defoor signed the
Settlement & Re-Engagement Agreement on Feb. 14, 2008, its claim for
compensation in Matter 1 was limited to the unliquidated quantum meruit
value of the contribution provided by its legal services. Resp.Br. 25. 1 RLG
offered to represent Defoor at trial in exchange for her acknowledging an
"obligation" that did not previously exist, and for agreeing to convert
RLG's existing quantum meruit Matter 1 claim into a secured, interestbearing $775,000 note, including $505,000 for fees, due in full even before
the Defoor Litigation concluded. The parties agree that RPC 1.8 would
obviously apply to such nonmonetary terms if the attorney had already
been engaged. See, e.g., Resp.Br. 21 (citing Valley/50th Ave., LLC v.
1 Nevertheless, RLG's brief neglects to address the controlling authority of Ausler v.
Ramsey, 73 Wn. App. 231, 868 P.2d 877 (1994) and Ross v. Scannell, 97 Wn.2d 598,647
P.2d 1004 (1982)---which Rafellikewise ignored in his dealings with Defoor when he
contended he was contractually entitled to the full amount of his claimed fees. See, e.g.,
CP 1688, 1723, 1795. As late as RLG's 30(b)(6) deposition in July 2011, Rafel took the
position that the Ausler I Ross rule did not apply to him. CP 1692-98.
2
DWT 20580291 v5 0089090-000003
Stewart, 159 Wn.2d 736, 745, 153 P.2d 186 (2007)).
Like the trial court, CP 2851, RLG assumes that RPC 1.8(a) does
not apply to Rafel' s conduct because Defoor was representing herself when
she signed the Agreement. Resp.Br. 19. According to RLG, there is "no
applicable case law or other authority applying RPC 1.8(a) to prospective
representations in Washington." !d. at 2. RLG is wrong.
First, RLG mischaracterizes Holmes v. Loveless, 122 Wn. App. 470,
94 P.3d 338 (2004), as a case that "involved an attorney who was already
representing the client at the time the alleged business transaction occurred."
Resp.Br. 21. To the contrary, the client in Holmes was a joint venture called
"Loveless/Tollefson Properties." 122 Wn. App. at 473.2 The attorney had
previously provided legal services to C.E. Loveless, id., but there is no
suggestion that he represented either the joint venture itself, co-venturer
Tollefson, or any other joint venture between them. The engagement
agreement with Loveless/Tollefson Properties provided for some of the
lawyers' compensation to come from a percentage of the profits of the
client's development venture. !d. The Court held that such an agreement
"falls within the scope of the business transaction rule." !d. at 475.
Second, although this Court's decision in Cotton v. Kronenberg,
2 In evaluating an attorney's compliance with RPC 1.8, courts must consider the identity
of the actual client, not affiliates. Valley/50th Ave., 159 Wn.2d at 747.
3
DWT 20580291 v5 0089090-000003
111 Wn. App. 258, 44 P.3d 878 (2002), did not focus on the precise timing
among documents executed at the outset of the engagement, the Court
explicitly cited the leading treatise for the proposition that Rule 1.8(a)
applies to nonmonetary business transaction terms that are agreed to
concurrently with the engagement agreement. !d. at 271 n.33 (quoting
Geoffrey C. Hazard, Jr., eta/., THE LAW OF LAWYERING§ 12.5).
Third, other treatises and commentators likewise recognize that
RPC 1.8(a) applies when there is an "[o]verlap between fee agreements and
business transactions." Andrews et al., LAW OF LAWYERING IN
WASHINGTON (WSBA 2012) at 7-43; see also WSBA Ethics Adv. Op.
2178 (2008) (attorney may not acquire a "promissory note for a sum certain
from a prospective client prior to work being performed or fees being
earned"); CP 2021 (Mark Fucile testified that Rule 1.8 applies to
promissory note obtained "at the formation stage" of engagement).
Finally, multiple provisions of RPC 1.8 itself demonstrate that the
reference in its heading to "Current Clients" includes the terms of an initial
engagement agreement. See, e.g., RPC 1.8(f) (third-party payment); RPC
1.8(i) (interest in litigation). As the first comment to Rule 1.8 states, the
requirements ofRPC 1.8(a) "must be met when the lawyer accepts an
interest in the client's business or other nonmonetary property as payment
of all or part of a fee." The trial court erred in holding otherwise.
4
DWT 2058029Jv5 0089090-000003
b. Rafel did not comply with RPC 1.8(a).
Defoor sought summary judgment of invalidity based on the
provision ofRPC 1.8(a)(1) requiring full disclosure, in writing, separate
from the terms of the contract itself, identifying the specific disadvantages
ofthe business transaction.3 As a matter of law, RLG failed to make the
required conflicts disclosures regarding the Settlement and Note.
RLG first argues that the "terms of the agreement were clearly
transmitted to Defoor." Resp.Br. 23; see also id. at 26 (Rafel informed
Defoor that "she was 'completely free' to decline his proposed terms"
regarding interest). But RPC 1.8(a) requires more than drafting and
sending a written contract. See, e.g., In re Disciplinary Proceeding Against
Haley, 157 Wn.2d 398,407, 138 P.3d 1044 (2006).
Second, RLG contends that Rafel may rely in hindsight on a letter
sent to Defoor by her former counsel, Ginger Edwards, on February 16,
2008-two days after Defoor had already signed the Settlement & ReEngagement Agreement. Resp.Br. 24 (citing CP 4278-83); CP 1848
(2114/08 signature). According to RLG, Rafel's discovery of another
attorney's subsequent letter excuses his own repeated mischaracterization
3 A lawyer must satisfy each of the requirements set forth in RPC 1.8(a). Cotton, 111 Wn.
App. at 272 (voiding contract because agreement was not fair and reasonable under RPC
1.8(a)(l)). As discussed below in Section D, the fairness and reasonableness ofRLG's fee
demand for Matter 1 present disputed factual issues, which independently require reversal
ofthe trial court's grant of summary judgment in favor ofRLG.
5
DWT 20580291 v5 0089090-000003
to Defoor, see n.l, supra, of her post-withdrawal rights and obligations.
But RPC 1.8(a) requires a complete written conflicts disclosure. It is true
that when "the client is independently represented in the transaction"
between attorney and client, the prior written disclosure may come either
from the attorney or from "the client's independent counsel." RPC 1.8 cmt
4 (emphasis added). In this case, however, Defoor was not represented in
her transaction with RLG. CP 652. Even if she had been, RLG is
unwilling to represent to this Court that Edwards' belated letter-which
raises serious questions regarding the fairness and reasonableness of the
transaction-actually constituted the operative written disclosure to
Defoor. Resp.Br. 25 n.5. Instead, RLG relies on the letter solely to "show
that Defoor was advised by independent counsel," id., thus satisfying RPC
1.8(a)(2)-which is separate from the additional requirements under RPC
1.8(a)(l) that the transaction terms be fair and reasonable, and that all
conflicts be fully disclosed in writing. Cotton, 111 Wn. App. at 272.
Finally, RLG contends that before transmuting its existing quantum
meruit claim for services in Matter 1 into a secured note obligating Defoor
to pay $505,000 plus costs as "a condition for Rafel agreeing to represent"
her, Rafel had no duty to disclose anything about its Matter 1 rates and
services beyond the astonishing total amount claimed because "there is no
evidence that Defoor ever asked for such records." Resp.Br. 26-27. RLG
6
DWT 20580291 v5 0089090-000003
has it backwards. It was Rafel's obligation to make full disclosure and
obtain informed consent prior to the transaction with Defoor. Defoor could
not consent to a Note obligating her to pay $505,000 in attorneys' fees for
Matter 1 if she had no clue about the premium "contingent" rates Rafel
proposed to charge, and no opportunity to review any description
whatsoever of the services purportedly provided. See In re Disciplinary
Proceeding Against McKean, 148 Wn.2d 849, 871, 64 P.3d 1226 (2003)
(disclosure must be sufficient to allow independent evaluation).
Rafel's attempt to distinguish the facts in Simburg, eta/., v. Olshan,
97 Wn. App. 901, 988 P. 2d 467 (1999), merely underscores his own utter
lack of candor. In Simburg, the attorneys failed to satisfy the "full
disclosure" element of accord and satisfaction because despite providing
billing records, the firm had neglected to disclose one lawyer's change in
billing rate. In contrast with that partial omission, Rafel repeatedly insisted
to Defoor-falsely-that she had a contractual duty to pay $505,000 for
fees without providing any information whatsoever about his
calculation-including the fact that it was based on premium "contingent
fee rates" that Rafel has never charged any other client, and included
numerous charges that he now acknowledges were improper. CP 1 000.
Even drawing all reasonable inferences in favor ofRLG, Rafel failed as a
matter of law to make the required RPC 1.8 disclosures.
7
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2. RLG Does Not Dispute That Rafel Violated RPC 1.8(a) By
Acquiring A Security Interest In "Any Assets Of Defoor."
As RLG observes, Defoor challenged a second aspect of the
Settlement & Re-Engagement Agreement: Rafel's knowing acquisition of
a "lien against any non-litigation assets held by Defoor." Resp.Br. 30.
Unlike the business transaction converting its Matter 1 quantum meruit
claim into a $775,000 note, RLG does not argue that this security interest is
beyond the scope ofRPC 1.8(a), or that Rafel made the required
disclosures, or that Defoor was advised by other attorneys regarding the
provision. See id. at 20-28. Instead, RLG merely contends that the lien it
demanded from Defoor "has never been asserted" against any of Defoor's
assets other than "property awarded to her in the litigation." Resp.Br. 31
(emphasis in original). 4
However, the plain language ofRPC 1.8(a) bars the acquisition of
security interests adverse to client, not just the enforcement of such
interests. A security interest is a valuable property right, with great
"potential for economic coercion by attorneys." Ross, 97 Wn.2d at 606.
4 In fact, RLG has not limited its claims to property recovered from Terry. See, e.g., CP
2238 (Rafel recognized that Defoor's jewelry was separate property and not subject to
division in litigation). RPC 1.8(i) separately governs the creation of liens in property that
is "recovered through the lawyer's efforts in the litigation." RPC 1.8 cmt 16. Other
substantive law, not at issue in this appeal, governs the priority and potential effect of
contractual lien provisions on particular real or personal property. See, e.g., RCW
64.04.010 (encumbrances on real estate effective by deed); Home Realty Lynwood, Inc. v.
Walsh, 146 Wn. App. 231, 237, 189 P.3d 253 (2008) (requiring property description).
8
DWT 20580291 v5 0089090-000003
See also LK Operating, LLC v. Collection Grp, LLC, 168 Wn. App. 862,
880, 279 P.3d 448 (2012) (RPC 1.8 does not require "that an actual benefit
be conferred" on lawyer); WASHINGTON LAW OF LAWYERING at 7-44
(agreement "interjecting a creditor-debtor relationship between the lawyer
and client before the lawyer-client relationship has even commenced" is
"not fair and reasonable to the client") (citing WSBA Ethics Op. 2178).
3. Because Rafel Violated RPC 1.8, RLG May Not Enforce
The Agreement Against Defoor.
As Division III of this Court recently reaffirmed, as a matter of
fundamental public policy, courts will refuse an attorney's efforts to
enforce client agreements when the lawyer has violated RPC 1.8. LK
Operating, 168 Wn. App. at 874-75 (collecting cases). RLG offers no
contrary authority regarding the consequence ofviolating RPC 1.8.
Instead, RLG argues that the Court may sever the offending
Matter 1 fee transaction and overbroad contractual lien provision "and
enforce the rest" of the Settlement & Re-Engagement Agreement. Resp.Br.
30. Even under general contract principles, RLG's argument fails because
the terms of the Note and the Settlement & Re-Engagement Agreement are
interdependent and cannot be severed from one another. A "contract is
'entire,' rather than severable, when 'the parties assented to all the
promises as a single whole, so that there would have been no bargain
9
DWT 20580291v5 0089090-000003
whatever, if any promise or set of promises were struck out."' In re
Marriage of McCausland, 129 Wn. App. 390,403, 118 P.3d 944 (2005).
As Rafel testified as RLG's CR 30(b)(6) designee, the contract with Defoor
was "an entire agreement" and "it's all part of a whole." CP 1714.
In any event, the Settlement & Re-Engagement Agreement is no
ordinary contract, but rather an agreement between attorney and client,
which must satisfy the strict requirements of RPC 1.8. LK Operating, 168
Wn. App. at 876. Rafel's conduct renders the Agreement "void as against
public policy." !d. at 881.
4. RLG's Unfounded Fraud Accusations Do Not Excuse
Rafel's Professional Misconduct.
After Defoor asserted malpractice counterclaims, RLG amended its
original collection claims to add multiple new legal theories, including
accusations of fraud. CP 276-78. Defoor vigorously disputes RLG's
accusations. RLG later abandoned its fraud contentions, which were never
adjudicated. CP 4391, 4402. Nevertheless, RLG now argues that this
Court should revive the Agreement on the grounds that Defoor
"fraudulently induced Rafel to enter" it. Resp.Br. 29.
Rafel's excessive lien claim for Matter 1 left Defoor with no
alternative to signing the Agreement (other than wiping out Rafel's improper
lien with the drastic step of declaring bankruptcy, her former attorneys'
10
DWT 2058029Iv5 0089090-000003
actual counsel to her). CP 1656. RLG twists Defoor's words at her
deposition to transform her well-founded objection to the amounts ofRafel's
Matter 1 fees and cost demands, CP 164 7, into a novel fraud defense. Rafel
required her to sign the false statement that she had an "obligation" to pay
$505,000 for Matter 1 fees. CP 1847. RLG's circular logic-that any
victim of duress who swears under oath that her signature was obtained
without coercion has no recourse against the perpetrator-is sheer chutzpah.
In any event, Rafel' s proffered defense cannot resuscitate a void
attorney engagement agreement. See, e.g., Corp. Dissolution of Ocean
Shores Park, Inc. v. Rawson-Sweet, 132 Wn. App. 903, 913, 134 P.3d 1188
(2006) (attorney's engagement agreement was "void as a matter of public
policy" where attorney "behaved unethically" under RPC 1.8); Cooper v.
Baer, 59 Wn.2d 763, 380 P.2d 871 (1962) (estoppel unavailable when
contract against public policy).
B. Disputed Factual Issues Preclude Summary Judgment On
Defoor's Malpractice Claim.
For Rafel's summary judgment on Defoor's malpractice claim to be
upheld, when the facts are viewed in the light most favorable to Defoor,
there must be no genuine issue of fact regarding whether Rafel breached
his duty of care to Defoor and whether his breach was the proximate cause
of Defoor's damage. Opening Br. 25. Genuine issues exist regarding both.
11
DWT 20580291 v5 0089090-000003
1. Rafel Breached His Duty of Care by Failing to Track the
Proceeds From Community Transactions.
The duty of care imposed on an attorney in a dissolution includes a
duty to track the disposition of community assets. First, malpractice
actions arising from dissolutions have routinely recognized that attorneys
breach the duty of care if they fail to discover, value, or track assets when
resolving divisions of property. These cases also recognize that the
question whether an attorney breached the duty by not taking adequate
steps to discover, value, or track assets is for the jury; it is not an
appropriate subject for summary judgment or a directed verdict. 5 Whether
to track assets is not a judgment call or an optional strategy; it is a basic
component of the duty of care.
5 See, e.g., Martin v. Northwest Wa. Legal Servs., 43 Wn. App. 405,409,717 P.2d 779
(1986); A loy v. Mash, 696 P.2d 656, 660 (Cal. 1985); Ishmael v. Millington, 241 Cal. App.
2d 520, 527 (1966); Grayson v. Woftey, Rosen, Kweskin & Kuriansky, 646 A.2d 195, 202-
03 & n.9 (Conn. 1994); Tarleton v. Arnstein & Lehr, 719 So.2d 325, 327 (Fla. App. 1998);
Stephen v. Sallaz & Gatewood, 248 P.3d 1256, 1260-62 (Idaho 2011); McDonaldv. Paine,
810 P.2d 259,262 (Idaho 1991); Landau v. Bailey, 629 N.E.2d 264,266-67 (Ind. App.
1994); Schneider v. Richardson, 411 A.2d 656, 658 (Me. 1979); Pickett, Houlon &
Berman v. Haislip, 533 A.2d 287,290-95 (Md. App. 1987); Guenardv. Burke, 443 N.E.2d
892, 897 (Mass. 1982); Teodorescu v. Bushnell, Gage, Reizen & Byington, 506 N.W.2d
275,276-78 (Mich. App. 1993); Oakes & Kanatz v. Schmidt, 391 N.W.2d 51, 54 (Minn.
App. 1986); London v. Weitzman, 884 S.W.2d 674,676 (Mo. App. 1994); Woodv.
McGrath, North, Mullin & Kratz, 589 N.W.2d 103, 108 (Neb. 1999); McWhirt v. Heavey,
550 N.W.2d 327,335-36 (Neb. 1996); Ziegelheim v. Apollo, 607 A.2d 1298, 1305-06 (N.J.
1992); Feng v. Kelley & Ferraro, 2009 WL 790345 at *3-4 (Ohio App. Mar. 26, 2009);
Ballesteros v. Jones, 985 S. W.2d 485, 495 (Tex. App. 1999); McClung v. Smith, 870
F.Supp. 1384, 1405 (E.D. Va. 1994), aff'd in relevant part, 89 F.3d 829 (4th Cir. 1996);
Helmbrecht v. St. Paul Ins. Co., 362 N.W.2d 118, 128-31 (Wis. 1985); Rino v. Mead, 55
P.3d 13, 20 (Wyo. 2002); cf Park v. Park, 612 P.2d 882, 889 (Cal. 1980) (vacating
dissolution when "the division of the community property was made without the aid of an
up-to-date financial declaration."); Nembach v. Giaimo & Vreeburg, 618 N.Y.S.2d 307
(A.D. 1994) (failure to replace husband as beneficiary on insurance policy).
12
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Second, Defoor's expert Ted Billbe testified that Rafel "did not do
a proper job of tracking the assets," which "resulted in him not being able
to put on a proper case." CP 2065. Mr. Billbe opined that "a reasonably
competent attorney would have tracked all of the quasi-community assets"
and that "Mr. Rafel failed to meet a standard of care that a reasonably
competent attorney would have met." CP 2066-67.
Third, Rafel' s own words confirm the duty to track assets. Shortly
after he was retained, he sought an extension because his predecessor had
not hired "accountants to analyze the complex transactions" of the Defoors
"and Mr. Defoor's disposition of millions of dollars in community assets
following the parties' separation." Rafel opined that "Such experts are
absolutely essential, to assure that Ms. Defoor's interests are properly
protected." CP 1928 (emphasis added). See also CP 1928-29 (~~ 4(a),
(b)); CP 1923-24. Rafel's own recognition ofthe need to track assets is, by
itself, sufficient to raise a question of fact regarding his breach. See Stanley
v. Richmond, 35 Cal. App. 4th 1070, 1092-95 (1995).
Rafel does not dispute that, with limited exceptions, he did not seek
to track what happened to the proceeds from the disposition of the
community assets. He contends, instead, that he did not breach his duty
because he "brought to the court's attention" the assets as they existed at
the time of separation or subsequent acquisition. This argument ignores
13
DWT 20580291v5 0089090-000003
the extent ofRafel's duty. It is not sufficient to tell the court where the
community assets have been. It is also "absolutely essential," CP 1928, to
track where the proceeds from the disposition of those assets went.
Proceedings in the Defoor Litigation demonstrate this fact. When
the proceeds from community assets were tracked, Judge Inveen awarded
Defoor half of those proceeds. See, e.g., CP 1917, 1920. But when Rafel
was unable to track the proceeds, the court did not allocate any portion to
Defoor. See, e.g., CP 1916-19,2303-04. Following are five examples
where Judge Inveen identified assets as community assets, but did not
assign half the proceeds to Defoor because Rafel did not track the proceeds.
1. Sale of Tobin Property and Purchase of Kirkland Home.
In January 2007, Terry sold the Tobin property, community property in
Renton, to the Washington Department of Transportation for approximately
$2.4 million. CP 1641, 1909 (~53), 2295,2303,2647. Immediately
thereafter, he purchased a home in Kirkland for approximately the same
amount, using $699,732 ofthe cash from the Tobin sale and borrowing the
rest. CP 1990-01 (~ 31), 1909 (~53), 1988.
The court found that Terry had used community assets to purchase
the Kirkland home. CP 1900-01 (~ 31), 1909 (~53). Because $699,732 of
the Tobin proceeds could be traced to the Kirkland residence, Judge Inveen
included it in the distribution of community assets. CP 1920. But because
14
DWT 20580291 v5 0089090-000003
Rafel had not sought to track what happened to the remaining $1.7 million,
Judge Inveen gave no credit to Defoor for that amount, notwithstanding
that it came from a community asset. CP 2303-04.
2. October 2007 Camwest Federal Way Payment. In October
2007, GWC received a payment of$1,050,000 from its development
partner Camwest with respect to a community asset in Federal Way. CP
1640-41 (~ 6), 1652-53 (~ 30), 1904, 2082, 3708-09 (~ 7), 3755-67. The
court found the payment was a community asset. CP 1903-05 (~ 42). The
next day, Terry transferred most of this payment ($950,000) to UBS
Account BK-02483-35. CP 1652-53 (~ 30), 2090, 2100, 2118.
Rafel represented to the court below that Terry did not produce
bank statements for Account 2483 or reflecting the $950,000 deposit.
CP 3709 (~ 9). In fact, documents produced by Rafel in this action show
that Terry did produce the bank statement reflecting the deposit and that
Rafel provided the statement to his expert Mr. Sutphen. CP 2110-19.
Also contrary to Rafel' s representation, the evidence is that Rafel
did not "bring to the court's attention" the fact that the $950,000 was sitting
in Account 2483. Rafel argued that Defoor should receive half of the
Camwest payment, since it was derived from a community asset. CP 2286,
2637-38,2645,2651, 3710 (~ 12), 3857. But because Rafel did not track
the funds and did not tell Judge Inveen that those funds were in
15
DWT 20580291 v5 0089090-000003
Account 2483, Judge Inveen did not give Defoor any credit for the
$950,000. CP 1916-19,2304. Defoor's expert Mr. Billbe specifically
described the failure by Rafel to track the $950,000 as an example of
Rafel's breach of his duty of care. CP 2066, 4095.
3. US Bank Account. As of Defoor and Terry's September
2006 separation, their joint US Bank account, in the name of GWC, had
over $3,000,000. CP 2003. Judge lnveen found that Terry transferred this
money to an account at UBS (Account BK-02642-35). CP 1911 (~ 61). As
of October 2007, the balance in that account had declined to $2 million, not
counting $700,000 attributable to the sale of the Costa Rica condominium.
Judge Inveen found that the funds in the account "were those of
GWC or the parties jointly," CP 1911 (~ 61) and awarded Defoor half of
the remaining $2 million. CP 1917. Rafel had argued that Defoor should
receive $4.3 million, which would have taken into account the $1.2 million
difference between the original $3.2 million and the remaining $2 million,
as well as other community funds that he had not tracked. CP 2286-97,
2637-38,2641,2645,2651, 3710 (~ 12), 3857-58. Judge Inveen rejected
this argument. She found that, though it appeared Terry had taken cash that
had belonged to the community, "the evidence just isn't sufficient" to track
what had happened to the money or to be sure that it wasn't already
accounted for in other assets being divided. CP 2303-04. As a result,
16
DWT 20580291 vS 0089090-000003
Defoor received no credit for $1.2 million from the couple's community
account because Rafel did not track where the money went.
4. March 2007 Camwest Fairwood Payment. In March 2007
Camwest made a payment of $225,000 to GWC with respect to a project
known as Fairwood. CP 2286, 3709 (~ 8), 3769, 3773. Judge Inveen found
that the payment was a community asset. CP 1905 (~ 43). Rafel argued
that Defoor should receive a payment that reflected half of this amount.
CP 2286. But because Rafel had not done anything to track where the
$225,000 went, Judge Inveen denied this request. CP 2303-04.
5. High Hook Boat. Judge Inveen found that Terry had sold a
community luxury fishing yacht and retained control of the $157,257
proceeds himself. CP 1910 (~ 58). Once again, Rafel argued that Defoor
should receive a payment that reflected half of this amount. CP 2286.
And, once again, because Rafel had not done anything to track where the
$157,257 went, Judge Inveen denied this request. CP 2303-04.
2. Rafel's Breach of Duty Was the Proximate Cause of
Damage to Defoor.
"In the legal malpractice context, proximate cause boils down to
whether the client would have fared better but for the attorney's
negligence." Lavigne v. Chase, Haskell, Hayes & Kalamon, 112 Wn. App.
677, 683, 50 P.3d 306 (2002). "Unless the question involves a pure matter
17
DWT 20580291 vS 0089090-000003
of law, such as whether the client would have prevailed on a statute of
limitations issue, the trier of fact determines the existence of proximate
cause." !d.; accord Versuslaw, Inc. v. Stoel Rives, LLP, 127 Wn. App. 309,
328-29, 111 P.3d 866 (2005); Daugert v. Pappas, 104 Wn.2d 254, 257-58,
704 P.2d 600 (1985). Whether an attorney's failure to discover, value, or
track community assets was the proximate cause of loss is a matter for
resolution at trial, not by summary judgment or directed verdict.6
Rafel suggests that even if he was negligent, Defoor should not
recover because she "has not provided any expert testimony to prove
causation, damages or collectability." Resp.Br. 41. There are multiple
flaws with this argument.
First, Defoor's expert Mr. Billbe did testify as to causation. He
explained that various community assets did not make it into the judgment
because the court had not been provided with information about what
happened to the cash proceeds from the assets, which left the court
confused and caused it to "thr[o]w its hands up." CP 4096-97.
Second, as Rafel acknowledges, expert testimony is not required as
6 See, e.g., Martin, 43 Wn. App. at 407, 409-11; Tennen v. Lane, 716 P.2d 1031, 1034
(Ariz. App. 1986); Callahan v. Clark, 901 S.W.2d 842, 847-48 (Ark. 1995); Aloy, 696
P.2d at 660; Stanley, 35 Cal. App. 4th at 1092-97; Lewis v. Superior Court, 77 Cal. App.
3d 844, 852-53 ( 1978); Ishmael, 241 Cal. App. 2d at 529-30; Grayson, 646 A.2d at 203;
Tarleton, 719 So.2d at 327-330; Millsaps v. Kaufold, 653 S.E.2d 344,345-47 (Ga. App.
2007); Meyer v. Wagner, 784 N.E.2d 34, 39 (Mass. App. 2003); Guenard, 443 N.E.2d
at 898; Teodorescu, 506 N.W.2d at 278; London, 884 S.W.2d at 677-78; McWhirt, 550
N.W.2d at 336-38; Nembach, 618 N.Y.S.2d at 307; Feng, 2009 WL 790345 at *3-4;
Helmbrecht, 362 N.W.2d at 131-32.
18
DWT 2058029lv5 0089090-000003
to matters within the common knowledge of lay persons. Resp.Br. 40.7
Here, it is evident that Rafel' s negligence was the proximate cause of
Defoor's harm. Whenever Judge Inveen could track what had happened to
the proceeds from community assets, she awarded halfto Defoor, as in the
case of the $699,732 from the Tobin sale that were tracked to the Kirkland
home and the $2 million from the US Bank account that were traceable to
UBS Account 2642. CP 1917, 1920. When, however, Rafel failed to track
what had happened to the community funds, Judge Inveen found that "the
evidence just isn't sufficient" to determine what had happened to the funds
and did not award anything to Defoor. CP 2304. A jury does not require
an expert to point out this fact.
Third, none of the cases cited by Rafel held that expert testimony
was required as to collectability. And several ofthem (Lavigne, Matson,
Tilly) held the plaintiff showed collectability, or created a genuine issue of
fact, notwithstanding that the evidence did not include expert testimony.
Finally, Rafel's argument regarding collectability ignores the fact
that Rafel was responsible for the inability to collect. Had he tracked what
happened to the community assets, he could have taken additional steps to
protect Defoor, e.g., through freezing the funds in UBS Account 2642 and
7 Accord Tarleton, 719 So.2d at 330; Morris v. Morris, 2003 WL 21509023 at *5-6 (Ohio
App. July 2, 2003).
19
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other accounts, lis pendens, temporary restraining orders, etc. Indeed, the
day after Rafel was hired, his "things to do" memo discussed the need to
take steps to protect Defoor through security. CP 1922-24. Accordingly,
he began researching the filing of lis pendens and began preparing a motion
"to protect and control assets." CP 2916,2918, 2920. But he did not file
any lis pendens or motion until almost three months later. CP 1642. Nor
did he ever take steps to freeze the bank accounts. The failure to provide
adequate security is, itself, malpractice, and the question whether an
attorney's work was deficient in this regard is for the jury.8 "If a plaintiff
has produced the best evidence available, and if the evidence affords a
reasonable basis for estimating a loss, courts will not permit a wrongdoer to
benefit from the difficulty of determining the dollar amount of loss,"
Lundgren v. Whitney's Inc., 94 Wn.2d 91, 98,614 P.2d 1272 (1980),
particularly when the wrongdoer's acts have created the difficulty in
determining damages with precision. "[T]he wrongdoer shall bear the risk
of the uncertainty which his own wrong has created." Jacqeline 's
Washington, Inc. v. Merchantile Stores Co., 80 Wn.2d 784, 789-90, 498
8 See, e.g., Reed v. Mitchell & Timbanard, 903 P.2d 621, 625-26 (Ariz. App. 1995); Rhine
v. Haley, 378 S.W.2d 655,656-58 (Ark. 1964); Margolin v. Kleban & Samar, P.C., 882
A.2d 653, 663-65 (Conn. 2005); Behr v. Foreman, 824 So.2d 222, 223-24 (Fla. App.
2002); Millsaps, 653 S.E.2d at 345-47; Sobilo v. Manassa, Riffner, Barber, Rowden &
Scott, 479 F. Supp. 2d 805, 812-22 (N.D. Ill. 2007); Meyer, 784 N.E.2d at 35-36; Peterson
v. Simasko, Simasko & Simasko, 579 N.W.2d 469,470 (Mich. App. 1998); Ehlinger v.
Ruberti, Girvin & Ferlazzo, 758 N.Y.S.2d 195 (A.D. 2003); Hart v. Carro, Spanbock,
Kaster & Cuiffo, 620 N.Y.S.2d 847, 849 (A.D. 1995).
20
DWT 2058029lv5 0089090-000003
P.2d 870 (1972).
C. Disputed Factual Issues Preclude Summary Judgment On
Defoor's Breach Of Fiduciary Duty Claim.
Rafel's denial that his filing ofliens was improper and excessive,
see Resp.Br. 42-45, merely demonstrates the existence of genuine issues of
fact. See Opening Br. at 42-43; see also CP 1858, 2170 (after reengagement RLG filed liens that included additional back-dated Matter 1
charges). As to Rafel's contention that there is no evidence "that Defoor
sought to retain other counsel other than possibly James Clark," Resp.Br.
43, the evidence is that Defoor did attempt to rehire Mr. Clark and was
unsuccessful because ofthe liens. CP 1630, 1647. As to Rafel's argument
that there is no evidence another lawyer would have achieved a better
result, competent counsel would have tracked community assets and
obtained adequate security. See discussion supra at 12-13.
Rafel also contends that to recover for emotional distress, Defoor
must show the distress is susceptible to medical diagnosis or accompanied
by objective symptoms. Resp.Br. 45-46. These requirements would apply
if Defoor were seeking emotional distress damages on her negligence
claim; they do not apply to intentional torts such as breach of fiduciary
duty. Kloepfel v. Bokor, 149 Wn.2d 192, 201, 66 P.3d 630 (2003); Berger
v. Sonneland, 144 Wn.2d 91, 112-13 & n.113, 26 P.3d 257 (2001).
21
DWT 20580291 v5 0089090-000003
D. Disputed Factual Issues Preclude Summary Judgment As To The
Fairness And Reasonableness OfRLG's $1,747,567 Fee Claim.
The reasonableness and fairness of an attorney's fee is a question of
fact, to be resolved by the jury and not on summary judgment. Jacob's
Meadow Owners Ass'n v. Plateau, 44 II, LLC, 139 Wn. App. 743,760-61,
162 P.3d 1153 (2007); Wolfe v. Morgan, 11 Wn. App. 738, 744, 524 P.2d
927 (1974). Reasonableness is generally based on a lodestar approach,
"arrived at by multiplying a reasonable hourly rate by the number of hours
reasonably expended on the matter." Scott Fetzer Co. v. Weeks, 122
Wn.2d 141, 150-51, 859 P.2d 1210 (1993) (emphasis in original).
"Necessarily, this decision requires the court to exclude from the requested
hours any wasteful or duplicative hours and any hours pertaining to
unsuccessful theories or claims." Mahler v. Szucs, 135 Wn.2d 398, 434,
957 P.2d 632 (1998).
Defoor has raised genuine factual issues concerning the
reasonableness ofRafel's fees. Opening Br. 44-48. Rafel's primary
response is to claim that the defects which Defoor has pointed to should be
ignored absent supporting expert testimony. Resp.Br. 47. While expert
testimony regarding the reasonable value of an attorney's services is
permitted, it "is neither central nor conclusive, and the court or jury may be
disregard it entirely." MacNaughton v. NBF Cable Sys., Inc., 1996
22
DWT 20580291 v5 0089090-000003
WL 33703873 (D. N.J. June 18, 1996).9 A jury may determine that an
attorney's request for fees is or is not reasonable based on factors such as
(1) the requesting attorney's own testimony and records, see, e.g.,
O'Conner v. Blodnick, Abramowitz & Blodnick, 744 N.Y.S.2d 205,206
(A.D. 2002), (2) the testimony of opposing counsel, see, e.g., Guity v.
CCI Enter., 54 S.W.3d 526,527-28 (Tex. App. 2001), and (3) the jury's
own assessment of the circumstances. See, e.g., Head, 105 U.S. at 49-50.
Genuine issues exist as to each of the following factors.
1. Hourly Rate. Discovery from Rafel indicates that his
regular hourly rate on non-contingent matters was $350 per hour and that in
only one case-Defoor's-has he charged a non-contingent-fee client his
hypothetical contingent fee rate of$450. CP 1646 (,-r 13), 2985 (40: 8-16),
2991, 2996, 3000-01. This discrepancy creates a genuine issue concerning
what the reasonable hourly rate should be. 10
9 Accord Brown v. State Farm Fire & Cas. Co., 66 Wn. App. 273, 283, 831 P.2d 1122
(1992) ("We agree with S. Speiser, Attorney's Fees§ 18.14, at 478 1973: 'Generally the
testimony of expert witnesses [on the issue of the value of services of an attorney] is not
essential."') (brackets in Brown); Headv. Hargrave, 105 U.S. 45,49-50 (1881); Verve,
LLC v. Hyper com Corp., 2006 WL 3385797 (D. Ariz. Oct. 19, 2006); Ball v. Posey, 176
Cal. App. 3d, 1209, 1215 (1986). Geerv. Tonnon, 137 Wn. App. 838,850, 155 P.3d 163
(2007), cited by Rafel, held that expert testimony may be required as to breach of the duty
of care, but did not so hold as to the reasonableness of the attorney's fee. See id. at 850-51.
10 See, e.g., City of Birmingham v. Horn, 810 So.2d 667, 683-84 (Ala. 2001) (attempt to
charge higher rate than rate attorney typically charged); O'Conner, 744 N.Y.S.2d at 206
(attorney's testimony that rate exceeded his usual rate established prima facie case that
fees were excessive); cf Bowers v. Transamerica Title Ins. Co., 100 Wn.2d 581, 597, 675
P.2d 193 ( 1983) ("Where the attorneys in question have an established rate for billing
clients, that rate will likely be a reasonable rate."); Baca v. Chiropractic v. Cobb, 317
S.W.3d 674,679-80 (Mo. App. 2010) (contradiction between rates charged and promised).
23
DWT 20580291 vS 0089090-000003
2. Number of Hours. The determination of whether the
requested hours are reasonable includes consideration of whether those
hours are wasteful or duplicative. Mahler, 135 Wn.2d at 434. Here,
counsel for Defoor has reviewed Rafel' s entries and identified 65 entries,
representing 220.5 hours and $63,191, that appear to be improper.
CP 2907-08 (~~ 3, 8), 2913-2979, 3002-71. Such a declaration is sufficient
to demonstrate the existence of a genuine issue of fact. 11
3. Quality of Work. The determination of a reasonable fee
must take into account the quality ofthe work performed. 12 An attorney
whose work has been negligent or who has violated RPC 1.8 should not
recover fees for performing that work. 13
4. Costs. When Defoor hired Rafel, he told her "the maximum
total costs for experts" would be $100,000. CP 1640 (~ 5). Instead, he has
sought costs of$383,184.29. CP 2860. This discrepancy, by itself, raises a
11 See, e.g., Brygider v. Atkinson, 385 S.E.2d 95, 96-97 (1989); Hinkle, eta/. v. Cadle Co.,
848 P.2d 1079, 1083-84 (N.M. 1993); Guity, 54 S. W.3d at 527-28.
12 See, e.g., Mahler, 135 Wn.2d at 434 ("unsuccessful theories or claims"); Bowers, 100
Wn.2d at 594, 597 ("quality of legal representation"; "unsuccessful claims"); RPC
1.5(a)(4) ("results obtained").
13 See, e.g., Shoemake v. Ferrer, 143 Wn. App. 819, 825-829, 182 P.3d 992 (2008)
(negligent attorney may not offset fee against malpractice award); Eriks v. Denver, 118
Wn.2d 451, 462, 824 P.2d 1207 (1992) ("The general principle that a breach of ethical
duties may result in denial or disgorgement of fees is well recognized."); Bowers, 100
Wn.2d at 594-597; Dailey v. Testone, 72 Wn.2d 662, 664, 435 P.2d 24 (1967); Saffer v.
Willoughby, 670 A.2d 527, 534 (1996) ("Ordinarily, an attorney may not collect attorney
fees for services negligently performed."); Kluczka v. Lecci, 880 N.Y.S.2d 698, 700 (A.D.
2009) ("An attorney may not recover fees for legal services performed in a negligent
manner even where that negligence is not a proximate cause of the client's injury.").
24
DWT 20580291 v5 0089090-000003
genuine issue as to reasonableness of costs. Baca, 317 S.W.3d at 679-80.
Rafel' s communication with his expert appraiser also confirms the
existence of a genuine issue regarding the reasonableness of the costs.
Rafel complained to the appraiser that his hourly rate exceeded the agreedto rate by $1 00 per hour and that the appraiser's work had been
"dangerously" deficient. CP 3075. Similarly, much of the costs paid
represent the work of Rafel' s accountant expert Mr. Sutphen. See CP 1 00,
1814. As demonstrated above, this work was deficient as well.
5. Result. RLG erroneously insists that it is entitled to the full
amount of its $1,747,567 fee claim, despite subsequent events that have
deprived Defoor herself of much of the value of her judgment against
Terry. See, e.g., RESTATEMENT OF LAWYERING§ 34 cmt. c & reporter's
note ("events not known or contemplated when the contract was made can
render the contract unreasonably favorable to the lawyer").
III. CONCLUSION
Even experienced attorneys make mistakes. The real test of a
person and a lawyer is what you do afterwards. Unfortunately, rather than
take responsibility for his failures, Rafel's strategy was to cover things up
and to attack his former client with an overreaching zeal that he never
approached when he represented her. This Court should reverse the
judgment below, and grant the relief set forth above at p. 1.
25
DWT 20580291 v5 0089090-000003
Respectfully submitted this 1st day ofNovember, 2012.
DWT 20580291 v5 0089090-000003
DAVIS WRIGHT TREMAINE LLP
Roger Let an, WSBA No. 19971
Zak Tomlinson, WSBA No. 35940
Attorneys for Appellant Stacey Defoor
26
,
CERTIFICATE OF SERVICE
The undersigned certifies under the penalty of perjury under the
laws ofthe State of Washington that I am now and at all times herein
mentioned, a citizen of the United States, a resident of the state of
Washington, over the age of eighteen years, not a party to or interested in
the above-entitled action, and competent to be a witness herein.
On November 1, 2012 I caused to be served by messenger a copy of
the foregoing document on the following:
Michael R. Caryl
Law Offices of Michael R. Caryl, P.S.
200 First Avenue West, Suite 402
Seattle, W A 98119
Kelly P. Corr
Paul R. Raskin
Corr Cronin Michelson Baumgardner & Preece LLP
1001 Fourth Avenue, Suite 3900
Seattle, WA 98154-1051
DATED this 1st day ofNovember, 2012.
27
DWT 2058029Jv5 0089090-000003
No. 68339-0-I
IN THE COURT OF APPEALS
OF THE STATE OF WASHINGTON
DIVISION I
STACEY DEFOOR,
Appellant
v.
RAFEL LAW GROUP PLLC
Respondent
Appeal From The Superior Court For King County
Hon. Mary Yu
APPENDIX OF NON-WASHINGTON AUTHORITIES
SUPPORTING REPLY BRIEF OF APPELLANT
STACEY DEFOOR
'·-'
DAVIS WRIGHT TREMAINE LLP
Roger Leishman, WSBA No. 19971
Zak Tomlinson, WSBA No. 35940
1201 Third Avenue, Suite 2200
Seattle, Washington 98101-3045
Telephone: (206) 622-3150
Facsimile: (206) 757-7700
E-mail: rogerleishman@dwt.com
Attorneys for Appellant Stacey Defoor
DWT 20586284v I 0089090-000003
Appellant Stacey Defoor hereby submits copies of the following
non-Washington State Cases in support of its Reply Brief:
1. A loy v. Mash, 696 P .2d 656 (Cal. 1985);
2. Baca v. Cobb, 317 S.W.3d at 679-80;
3. Ball v. Posey, 176 Cal. App. 3d (1986);
4. Ballesteros v. Jones, 985 S.W.2d 485 (Tex. App. 1999);
5. Behr v. Foreman, 824 So. 2d 222 (Fla. App. 2002);
6. Brygider v. Atkinson, 385 S.E.2d at 96-97;
7. Callahan v. Clark, 901 S.W.2d 842 (Ark. 1995);
8. City of Birmingham v. Horn, 810 So.2d 667 (Ala. 2001);
9. Ehlinger v. Ruberti, Girvin & Ferlazzo, 758 N.Y.S.2d 195
(A.D. 2003);
10. Feng v. Kelley & Ferraro, 2009 WL 790345 (Ohio App. 2009);
11. Grayson v. Woftey, Rosen, Kweskin & Kuriansky, 646 A.2d 195
(Conn. 1994);
12. Guenardv. Burke, 443 N.E.2d 892 (Mass. 1982);
13. Guity v. CCI Enterprise, 54 S.W.3d at 527-28;
14. Hart v. Carro, Spambock, Kaster & Cuiffo, 620 N.Y.S.2d 847
(A.D. 1995);
15. Headv. Hargrave, 105 U.S. 45 (1881);
16. Helmbrecht v. St. Paul Ins. Co., 362 N.W.2d 118 (Wis. 1985);
17. Hinkle, Cox, Eaton, Coffield & Hensley v. Cadle Co., 848 P.2d
1079 (N.M. 1993);
1
DWT 20586284vl 0089090-000003
18. Ishmael v. Millington, 241 Cal. App. 2d 520 ( 1966);
19. Kluczka v. Lecci, 880 N.Y.S.2d 698 (A.D. 2009);
20. Landau v. Bailey, 629 N.E.2d 264 (Ind. App. 1994);
21. Lewis v. Superior Court, 77 Cal. App. 3d 844 (1978);
22. London v. Weitzman, 884 S.W.2d 674 (Mo. App. 1994);
23. MacNaughton v. NBF Cable Systems, Inc., 1996 WL 33703873
(D. N.J. 1996);
24. Margolin v. Kleban & Samar, P.C., 882 A.2d 653 (Conn. 2005);
25. McClung v. Smith, 870 F. Supp. 1384 (E.D. Va. 1994), aff'd in
relevant part, 89 F .3d 829 (4th Cir. 1996);
26. McDonald v. Paine, 810 P.2d 259 (Idaho 1991);
27. McWhirt v. Heavey, 550 N.W.2d 327 (Neb. 1996);
28. Meyer v. Wagner, 784 N.E.2d 34 (Mass. App. 2003);
29. Millsaps v. Kaufold, 653 S.E.2d 344 (Ga. App. 2007);
30. Morris v. Morris, 2003 WL 21509023 (Ohio App. 2003);
31. Nembach v. Giaimo & Vreeburg, 618 N.Y.S.2d 307 (A.D. 1994);
32. O'Conner v. Blodnick, Abramowitz & Blodnick, 744 N.Y.S.2d 205
(A.D. 2002);
33. Oakes & Kanatz v. Schmidt, 391 N.W.2d 51 (Minn. App. 1986);
34. Park v. Park, 612 P .2d 882 (Cal. 1980);
35. Peterson v. Simasko, Simasko & Simasko, 579 N.W.2d 469
(Mich. App. 1998);
36. Pickett, Houlon & Berman v. Haislip, 533 A.2d 287
(Md. App. 1987);
3 7. Reed v. Mitchell & Timbanard, 903 P .2d 621 (Ariz. App. 1995);
2
DWT 20586284vl 0089090-000003
38. Rhine v. Haley, 378 S.W.2d 655 (Ark. 1964);
39. Rino v. Mead, 55 P.3d 13 (Wyo. 2002);
40. Saffer v. Willoughby, 670 A.2d 527;
41. Schneider v. Richardson, 411 A.2d 656 (Me. 1979);
42. Sobilo v. Manassa, Riffner, Barber, Rowden & Scott,
479 F. Supp. 2d 805 (N.D. Ill. 2007);
43. Stanley v. Richmond, 35 Cal. App. 4th 1070 (1995);
44. Stephen v. Sallaz & Gatewood, 248 P.3d 1256 (Idaho 2011);
45. Tarleton v. Arnstein & Lehr, 719 So.2d 325 (Fla. App. 1998);
46. Tennen v. Lane, 716 P.2d 1031 (Ariz. App. 1986);
47. Teodorescu v. Bushnell, Gage, Reizen & Byington,
506 N.W.2d 275 (Mich. App. 1993);
48. Verve, LLC v. Hypercom Corp., 2006 WL 3385797 (D. Ariz. 2006);
49. Wood v. McGrath, North, Mullin & Kratz, 589 N.W.2d 103
(Neb. 1999);
50. Ziegelheim v. Apollo, 607 A.2d 1298 (N.J. 1992).
3
DWT 20586284vl 0089090-000003
CERTIFICATE OF SERVICE
The undersigned certifies under the penalty of perjury under the
laws ofthe State of Washington that I am now and at all times herein
mentioned, a citizen of the United States, a resident of the state of
Washington, over the age of eighteen years, not a party to or interested in
the above-entitled action, and competent to be a witness herein.
On November 1, 2012 I caused to be served by messenger a copy of
the foregoing document on the following:
Michael R. Caryl
Law Offices ofMichael R. Caryl, P.S.
200 First Avenue West, Suite 402
Seattle, W A 98119
Kelly P. Corr
Paul R. Raskin
Corr Cronin Michelson Baumgardner & Preece LLP
1001 Fourth Avenue, Suite 3900
Seattle, W A 98154-1051
DATED this 1st day ofNovember, 2012.
4
DWT 20586284vl 0089090-000003
Page I
LexisNexis®
MARCELLA G. ALOY, Plaintiff and Appellant, v. EUGENE A. MASH, Defendant
and Respondent
S.F. No. 24639
Supreme Court of California
38 CaL 3d 413; 696 P.2d 656; 212 CaL Rptr. 162; 1985 CaL LEXIS 268; 6 Employee
Benefits Cas. (BNA) 1436
March 28, 1985
PRIOR HISTORY: Superior Court of Merced
County, No. 64654, Donald R. Fretz, Judge.
DISPOSITION: The judgment is reversed.
SUMMARY:
CALIFORNIA OFFICIAL REPORTS SUMMARY
In a malpractice action against an attorney who represented plaintiff in dissolution of marriage proceedings
in 1971, for failure to assert a community property interest in the vested military pension of her husband, who
was then on active duty although eligible to retire, defendant moved for summary judgment on the ground that
in 1971 the law regarding the character of federal military retirement pensions was unsettled, and that he had
exercised informed judgment and was therefore immune
from a claim of professional negligence. The trial court
granted the motion and entered summary judgment for
defendant. (Superior Court of Merced County, No.
64654, Donald R. Fretz, Judge.)
The Supreme Court reversed, holding a triable issue
of negligence was presented, in view of the showing that
defendant had failed to claim the pension was community property based on an incomplete reading of a single
case, without appreciating the vital difference between a
member of the armed forces who has not yet served long
enough to be eligible to retire and one who has, but
chooses to stay in the service. The court rejected defendant's contention that a 1981 United States Supreme
Court decision that the application of community property principles impermissibly conflicted with the federal
military retirement scheme immunized him from liability. It held all the evidence is negative that in the early
1970's the United States Supreme Court would have
granted certiorari on the issue whether states could hold
military pensions to be community property. Moreover,
noting the extremely limited retroactive effect given to
that decision, it held that it would be ironic if its chief
legacy were immunization of legal malpractice by an
attorney who never even pondered the issues which fathered the decision's brief life. (Opinion by Kaus, J., with
Mosk, Grodin, JJ., and Ramsey, J., • concurring. Separate
dissenting opinion by Reynoso, J., with Bird, C. J., and
Taber, J., ·concurring.)
* Assigned by the Chairperson of the Judicial
Council.
HEAD NOTES
CALIFORNIA OFFICIAL REPORTS HEADNOTES
Classified to California Digest of Official Reports, 3d
Series
(1) Attorneys at Law § 22--Attorney-client Relationship--Liability of Attorneys--Acts Constituting Malpractice--Dissolution Action--Failure to Assert Military Pension Claim--Insufficient Research. --In a
malpractice action against an attorney who represented
plaintiff in her dissolution of marriage proceedings in
1971, for failure to assert a community property interest
in the vested military pension of her husband, who remained on active duty although eligible to retire, a triable
issue of negligence existed precluding summary judgment for defendant, where it appeared defendant failed to
claim pension rights based on an incomplete reading of a
Page 2
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
single case, without appreciating the vital difference between a member of the armed forces who has not yet
served long enough to be eligible to retire and one who
has, but chooses to stay in the service, and who did not
even consider the issue of federal preemption of community property interests in military pensions.
(2) Attorneys at Law § 24--Attorney-client Relationship--Liability of Attorneys-Defenses to Malpractice
Actions--Lack of Damage. --In a malpractice action
against an attorney who ·represented plaintiff in dissolution of marriage proceedings in 1971, it was not a defense to defendant's negligence in failing to assert a
claim to the husband's vested military pension, then an
unsettled issue, that the United States Supreme Court
decided in 1981 that application of state community
property principles to military pensions impermissibly
conflicted with the federal military retirement scheme.
All the available evidence is negative that in the early
1970's the United States Supreme Court would have
granted certiorari on the issue whether states could hold
military pensions to be community property. Moreover,
the United States Supreme Court decision was given
extremely limited retroactive (or prospective) effect, so
that it would be ironic if its chief legacy were the immunization of legal malpractice by an attorney who never even pondered the issues which fathered the decision's
brief life.
COUNSEL: Miles, Sears & Eanni, Richard C. Watters
and William J. Seiler for Plaintiff and Appellant.
James L. Stevens, Jr., as Amicus Curiae on behalf of
Plaintiff and Appellant.
R. Gaylord Smith, Conrad R. Aragon, M. Patricia Marrison and Lewis, D'Amato, Brisbois & Bisgaard for Defendant and Respondent.
Ronald E. Mallen and Long & Levit as Amici Curiae on
behalf of Defendant and Respondent.
JUDGES: Opinion by Kaus, J., with Mosk, Grodin, JJ.,
and Ramsey, J., • concurring. Separate dissenting opinion by Reynoso, J., with Bird, C. J., and Taber, J., • concurring.
* Assigned by the Chairperson of the Judicial
Council.
OPINION BY: KAUS
OPINION
[*415] [**657] [***162] I
Marcella G. Aloy, plaintiff in a legal malpractice action, appeals from a summary judgment for defendant
Eugene A. Mash, her former attorney in a 1971 dissolution action against her husband Richard. Marcella's
claim of legal malpractice is based on defendant's failure
to assert a community [***163] property interest in
Richard's vested military retirement pension. 1
The pension was vested because Richard had
been in the service for over 20 years and thus had
an unconditional right to it upon retirement.
It is unclear whether the pension could also
be termed "matured." There is some inconsistency in the defmition of a "matured" pension. Most
cases defme it as one in which all conditions
precedent to the payment of the benefits have
taken place or are within the control of the employee. (In reMarriage of Gillmore (1981) 29
Ca/.3d 418, 422, fn. 2 [174 Cal.Rptr. 493, 629
P.2d 1); In re Marriage of Fithian (1974) 10
Cal. 3d 592, 596, fn. 2 [1 11 Cal.Rptr. 369, 517
P.2d 449]; Smith v. Lewis (1975) 13 Ca/.3d 349,
355, fn. 4 [1 18 Cal.Rptr. 621, 530 P.2d 589, 78
A.L.R.3d 231].) Under this defmition the pension
was also matured. In re Marriage of Brown
(1976) 15 Ca/.3d 838, 842 [126 Cal.Rptr. 633,
544 P.2d 561, 94 A.L.R.3d 164], however, defmed a "matured" benefit as one where there is an
"unconditional right to immediate payment" --
i.e., where the employee "reaches retirement age
and elects to retire." Under the latter defmition,
Richard's pension had not matured since he was
still on active duty.
Marcella employed defendant Mash in January
1971 to represent her in the dissolution action. Richard
was then on active military service and was therefore not
receiving a pension although he had been in the service
for over 20 years and was eligible to retire. (1 0 US. C. §
891 1.) Defendant failed to claim any community property interest in Richard's pension and it was not put in issue
in the dissolution action. The fmal decree of dissolution
was entered in December 1971. Richard retired sometime between 1971 and 1980.
[*416] In 1971, the California view regarding the
characterization of vested federal military retirement
pensions as community or separate property was unsettled. In 1974, however, we held that federal preemption
did not bar treating such federal military pensions as
community property. ( In re Marriage of Fithian, supra,
10 Ca/.3d 592.)
In 1980, Marcella filed a complaint against defendant alleging that he negligently failed to assert her community property interest in Richard's military retirement
Page 3
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
pension, which failure prevented her from receiving any
share of his gross military retirement pension benefits
"from either the date of separation and/or the date of
[his] retirement."
Defendant moved for summary judgment on the
ground that in 1971 the law regarding the character of
federal military retirement pensions was unsettled, and
that he had exercised informed judgment and was therefore immune from a claim of professional negligence.
He submitted a declaration stating, among other things:
"2. In 1971, it was my practice to read advance sheets,
particularly in the dissolution area, an area in which I
have regularly practiced. I would therefore have had
knowledge of specific decisions at the time they were
rendered or shortly thereafter. [para. ] 3. In 1971, I relied on the case of French v. French, 17 Ca/.2d 775
(1941) as authority that a nonmatured military pension,
that is, one owned by a person on active military duty,
was not subject to division upon dissolution. I was also
aware that in 1971 this case had not yet been overruled.
I read the decision In re Marriage [**658) of Fithian,
10 Ca/.3d 592 (1974) shortly after it was issued in 1974.
[para. ] 4. I drafted the terms of the interlocutory decree
based on my research, knowledge, and understanding of
the law in 1971."
Marcella opposed the motion, asserting that it was a
triable issue whether defendant had made an informed
decision. She submitted excerpts from her deposition
testimony in which she stated that the one time she asked
defendant whether she was entitled to a portion of Richard's military retirement pension, he told her she had no
such right because Richard was still on active duty.
Marcella also submitted excerpts from defendant's deposition testimony where he discussed his knowledge and
research as follows: "Mr. Watters: Q. Are you a regular
reader of the advance sheets, say from 1971 up until
now? [para. ] A. I read them. I get them in the office
but I can't recall when I started getting them, frankly.
Whether I got them in 1971, I don't know. I used to
read the advance [***164] sheets all the time but I
don't know when I got them. I still skim them, review
them, when I can. [para. ] Q. You review the cases in
your particular area of practice? [para. ] A. Yes, I do.
[para. ] Q. That would include the domestic area, up until
you stopped doing domestic work, or slowed down?
[para.] A. Right. [para.] Q. As of 1971, what was your
case authority for your position that when someone in the
[*417] military service was on active duty that their
pension was not community property, what was your
authority? [para. ] A. I don't know what I checked with
at that time. Probably the French case would be the
authority. [para. ] Q. A 1941 case? [para. ] A. Whatever the date is. [para. ] Q. Sir, any other authority that
you can cite me other than the French case for that belief
that you had? [para. ] ... [para. ] A. I can't recall what
else, what I might have looked up at that point. Might
have been something else but I don't . . . [para. ] A.
Well, this is again going back to my thinking, what I
might have thought back then, and I'd have to say probably the same thing, that if a person has been in the military, active military duty, was not drawing his pension,
that it was not an item to be divided at that time. [para. ]
Q. This would be true when the person was in the service
over twenty years, over twenty or under twenty years?
[para. ] Mrs. Marrison: Q. Do you understand the question? [para. ] A. I presume he is asking what was in my
mind at that time and I'm not sure in this case at that time
what was in my mind. I'm not sure what I would have
stated at that time. If you ask me the question in 1971,
is that what you're asking?"
Marcella further submitted a declaration by James J.
Simonelli, which stated that he was an attorney with an
extensive practice in family law since 1970, and that in
1971 attorneys in the family law field in the San Joaquin
Valley uniformly claimed a community property interest
in vested military retirement pensions. Simonelli further
stated that had he been representing Marcella in November 1971, he would have advised her that she had some
community property interest in Richard's vested military
retirement pension and that the only issue as to that interest was whether federal law preempted state enforcement of such an interest.
II
The criteria on appeals from summary judgments are
too familiar to need restatement. In brief, if the record
discloses triable issues with respect to negligence, causation and damages, the judgment must be reversed.
In Smith v. Lewis (1975) 13 Ca/.3d 349 [118
Cai.Rptr. 621, 530 P.2d 589, 78 A.L.R.3d 231} --a legal
malpractice case based on an attorney's 1967 failure to
claim a community property interest in the husband's
vested retirement benefits -- we affirmed a judgment for
plaintiff and rejected the defendant attorney's contention
that he should not be liable for mistaken advice when
well-informed lawyers in the community had entertained
reasonable doubt at the time as to the proper resolution
of the legal issue. We found the situation in no way
analogous to that in Lucas v. Hamm (1961) 56 Ca/.2d
583 [**659] [15 Cal.Rptr. 821, 364 P.2d 685}, involving the esoteric subject of the rule against perpetuities. We conceded that in 1967 the law [*418] regarding the community character of the husband's federal
pension was unsettled. We said, however: "If the law on
a particular subject is doubtful or debatable, an attorney
will not be held responsible for failing to anticipate the
manner in which the uncertainty will be resolved. [Citation.] But even with respect to an unsettled area of the
Page 4
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
law, we believe an attorney assumes an obligation to his
client to undertake reasonable research in an effort to
ascertain relevant legal principles and to make an informed decision as to a course of conduct based upon an
intelligent assessment of the problem." (Id at pp.
358-359.)
Smith v. Lewis, supra, I 3 Cal. 3d 349, is obviously
of little help to defendant. His motion for summary
judgment was, in fact, primarily based on Davis v.
Damrell (1981) 119 Ca/.App.3d 883 [174 Cal.Rptr. 257]
--a similar [***165) case in which Damrell, the wife's
attorney, in 1970 failed to assert a community property
interest in the husband's vested federal military retirement pension. The husband retired in 1973, and the wife
filed suit against Damrell sometime thereafter. The
Court of Appeal affirmed the summary judgment for
Damrell on the ground that he had demonstrated compliance with the Smith v. Lewis standards by showing a
thorough, contemporaneous research effort on an issue of
unsettled law. He had submitted a declaration describing his detailed knowledge of legal developments and
debate in the field. He traced his familiarity with the
line of cases following the earlier French rule ( French v.
French (1941) 17 Ca/.2d 775 [112 P.2d 235, 134 A.L.R.
366] [nonvested military pension was mere expectancy
not subject to division as community property]), overruled in In reMarriage of Brown (1976) 15 Ca/.3d 838
[126 Cal.Rptr. 633, 544 P.2d 561, 94 A.L.R.3d 164},
and recounted his special interest in the Wissner case (
Wissner v. Wissner (1950) 338 US. 655 [94 L.Ed 424,
70 S.Ct. 398} [establishing the supremacy of a federal
statute governing disposition of the proceeds of a military service life insurance policy]), which had motivated
him to follow its progress from its inception.
Defendant's reliance on Davis v. Damrell, supra,
119 Cal.App.3d 883, is ill-advised, since the differences
between his professional conduct and that of the defendant in that case inexorably point to potential liability on
defendant's part. In brief, in Davis the defendant attorney was thoroughly familiar with all the pertinent authorities, state and federal, and had reached the conclusion, based primarily on Wissner v. Wissner, supra, 338
US. 655, that vested military pension benefits were not
subject to California community property rules. His
decision not to claim a community property interest in
the husband's military pension was not actionable, as it
represented "a reasoned exercise of an informed judgment grounded on a professional evaluation of applicable
legal principles." ( Id ., [**660] 119 Cal.App.3d at
[*419] p. 888.) 2 Defendant, by contrast, relied on a
single case -- French v. French (1941) 17 Ca/.2d 775
[112 P.2d 235, 134 A.L.R. 366} for the proposition that a
nonmatured military pension was not subject to division
on dissolution. At his deposition he never did answer the
question whether he was aware that a military pension
vests after 20 years of service, whether the serviceman
retires or not. This would have been a vital point in his
research, for in French v. French itself a dictum indicates that after retirement pay vests it becomes community property. ( Id at p. 778.) 3 He thus never even gave
himself a chance to consider whether his client was entitled to a community share in monthly payments which,
but for the husband's election not to retire, would have
been vested pension payments. (See In re Marriage of
Gillmore, supra, 29 Ca/.3d 418, 423; Waite v. Waite
(1972) 6 Ca/.3d 461, 472 [99 Cal.Rptr. 325, 492 P.2d
13}.)
2 Amicus, appearing on behalf of defendant,
argues that, were the rule otherwise,
"[self-defensive] instincts would encourage lawyers to provide their clients with the most popular
perception of the law rather than their own views.
Candor and creativity would be replaced by consensus. Such a rule would be neither in the interest of clients nor lawyers." Brave words, but
one suspects that a client whose interests coincide
with the popular conception . of the law would
expect his attorney to advance them, particularly
if the consensus is shared by the judiciary.
3 Presumably the same dictum was belatedly
discovered by the defendant in Smith v. Lewis.
(See Smith v. Lewis, supra, 13 Ca/.3d at p. 358,
fn. 7.)
(1) In sum, this is not a case where the defendant
attorney, basing his judgment on all available data, made
a rational professional judgment not to claim an interest
in the husband's pension. Rather, he acted -- more precisely, failed to act -- on an incomplete reading of a single case, without appreciating the vital difference between a member of the armed forces who has not yet
served long enough to be eligible to retire and one who
has but chooses to stay in the service. As far as the issue of federal preemption is concerned, the record does
not show that he ever considered it.
[***166] In sum, the record on which the motion
for summary judgment was argued presented a triable
issue of negligence.
III
The question whether the defendant's negligence
caused damage in some amount need not detain us long.
Footnote 9 to Smith v. Lewis, supra, 13 Cal. 3d at pages
360-361, makes this an a fortiori case. (See also Martin
v. Hall (1971) 20 Cai.App.3d 414, at pp. 423-424 [97
Cal.Rptr. 730, 53 A.L.R.3d 719].) Nor-- the arguments
based on McCarty v. McCarty (1981) 453 US. 210 [69
Page 5
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
L.Ed2d 589, IOI S.Ct. 2728}, aside-- do we understand
defendant to claim otherwise.
[*420) IV
McCarty v. McCarty, supra, decided on June 26,
1981, held that the application of community property
principles impermissibly conflicts with the federal military retirement scheme. This, of course, happened a
decade after defendant had represented plaintiff. Nor,
unlike the defendant attorney in Davis v. Damrell, supra,
119 Cal.App.3d 883, had defendant anticipated this development. (2) Nevertheless he seeks to take advantage
of McCarty in two ways: first, he argues that had he asserted a community property interest in Richard's pension, the United States Supreme Court case which invalidated any favorable ruling by a California court might
have been Aloy v. Aloy, rather than McCarty v. McCarty;
second, he argues that it simply cannot be actionable
malpractice not to assert a claim which is eventually
found to be invalid.
A
Defendant's first argument assumes, of course, that
McCarty v. McCarty once and for all settled the question
of Colonel McCarty's pension in his favor. Solely because we happen to know judicially that the McCarty
controversy is far from over and do not wish to make any
unnecessary statement which might affect its outcome,
we shall assume defendant's hypothesis to be true. •
4 We know nothing about the details of the
continuing McCarty litigation. It seems a fair
guess, however, that it is somehow affected by
the passage of the Federal Uniformed Services
Former Spouses' Protection Act of 1982.
(Pub.L. No. 97-252, tit. X.) It is, of course, 100
percent speculation whether the mythical Aloy v.
Aloy (197 ) U.S. , would have triggered
similar federal legislation.
Assuming further that it is a legitimate subject of
inquiry whether, at the critical time, the early '70's, the
United States Supreme Court would have granted certiorari on the issue whether states could hold military pensions to be community property, all the available evidence is negative. After we first decided in favor of the
nonmember spouse in Fithian, certiorari was denied (
Fithian v. Fithian (1974) 4I9 US. 825 [42 [**661]
L.Ed.2d 48, 95 S.Ct. 4I}), as was a petition for rehearing.
(Fithian v. Fithian, supra, at p. 1060 [42 L.Ed.2d 657,95
S.Ct. 644].) Shortly thereafter we reaffirmed Fithian in
In re Marriage of Mi/han (1974) 13 Ca/.3d I29 [II7
Cal.Rptr. 809, 528 P.2d I145]. Again certiorari was denied. ( Milhan v. Milhan (1975) 42I US. 976.) Nothing
in the Aloy v. Aloy litigation suggests to us that it was
[*421] more likely than Fithian or Milhan to persuade
the high court that the military pension issue was one
whose time had come. 5
5 It is the repeated denial of certiorari which
distinguishes this case from Martin v. Hall, supra, 20 Cal.App.3d 414, 423-424. There an attorney retained to represent a client accused of
crime, failed to assert the, under the circumstances, plausible bar of the multiple prosecution aspect of Penal Code section 654. His omission
took place after we had hinted in Neal v. State of
California (1960) 55 Ca/.2d II, 2I [9 Cal.Rptr.
607, 357 P.2d 839}, that section 654 might preclude multiple prosecutions even in situations in
which multiple punishment would be permissible.
Kellett v. Superior Court (1966) 63 Ca/.2d 822
[48 Cal.Rptr. 366, 409 P.2d 206}, however,
which eventually so held, was still some years
down the road. On the issue of causation, the
Court of Appeal held that it had "no reason to
suppose that the result in a hypothetical Martin v.
Superior Court would have been different." Here
there is every reason to suppose that Aloy v. Aloy
would not have escaped the confmes of California.
[***167] B
Finally we tum to the argument that the summary
judgment was correct because the claim which defendant
negligently failed to assert in 1971 luckily turned out to
be worthless in 1981 -- the serendipity defense. This
argument is not based on any theory that in point of fact
Marcella would not have benefited fmancially had a
community property claim to Richard's pension rights
been asserted in 1971. (See pt. III, ante.) Rather, defendant simply asserts that he was under no "duty to secure for plaintiff benefits to which she was not legally
entitled." 6
6 Amicus for defendant makes the same point
more subtly by distinguishing between "fault" --
conceded-- and "error"-- disputed.
It is evident from the way defendant makes his point
-- "benefits to which she was not legally entitled" -- that
he assumes as a premise of his argument that McCarty
has been retroactively applied and that, therefore, in a
real sense McCarty "was" the law 10 years before it was
decided, when defendant acted for Marcella.
Whatever may be said in favor of defendant's theory
were this premise correct, the fact is that no case within
our memory has received less retroactive application
than McCarty. Starting with the last paragraph of the
McCarty opinion itself, the judicial and legislative
branches, state and federal, cooperated in a massive and
Page 6
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
largely successful drive to make McCarty disappear --
prospectively, presently and retroactively. Some highlights of that effort are noted below. 7 The result is that,
for most [**662] [***168] purposes, McCarty
[*422] not only is not the law but never really was. As
one Court of Appeal put it: "[There] is no longer any
McCarty rule to be retroactively applied." ( In re Marriage of Frederick (1983) 141 Cal.App.3d 876, 880 [190
Cal.Rptr. 588].) It would be ironic if the chief legacy of
McCarty were the immunization of legal malpractice by
an attorney who never even pondered the issues which
fathered McCarty's brief life.
7 I. The United States Supreme Court itself did
not think too highly of the result it felt compelled
to reach: "We recognize that the plight of an
ex-spouse of a retired service member is often a
serious one . . . . That plight may be mitigated to
some extent by the ex-spouse's right to claim Social Security benefits, cf. Hisquierdo, 439 U.S.,
at 590, and to garnish military retired pay for the
purposes of support. Nonetheless, Congress may
well decide, as it has in the Civil Service and
Foreign Service contexts, that more protection
should be afforded a former spouse of a retired
service member. This decision, however, is for
Congress alone." ( McCarty v. McCarty, supra,
453 U.S. at pp. 235-236 [69 L.Ed2d at p. 608].)
2. Congress, as part of the fiscal 1983 defense bill passed title X of Public Law No.
97-252, the Federal Uniformed Services Former
Spouses' Protection Act (FUSFSP A) which, in
effect, nullified McCarty prospectively and, in
part, retroactively. (See 10 U.S. C. § 1408 et seq.;
§ I 006 of the act allows enforcement of
pre-McCarty judgments.)
3. Even without the benefit of or reliance on
FUSFSPA, our cases uniformly held that
pre-McCarty judgments treating military pensions as community property were not affected by
McCarty. (In reMarriage of Camp (1983) 142
Cal.App.3d 217, 219-221 [191 Cal.Rptr. 45]; In
reMarriage of Parks (1982) 138 Cal.App.3d 346,
348-349 [188 Cal.Rptr. 26}; In re Marriage of
McGhee (1982) 131 Cal.App.3d 408, 411 [182
Cal.Rptr. 456]; In reMarriage of Fellers (1981)
125 Cal.App.3d 254, 256-258 [178 Cal.Rptr. 35};
In reMarriage ofSheldon (1981) 124 Cal.App.3d
371, 377-380 [177 Cal.Rptr. 380].) This was declared to be the law even if the case was still
pending on appeal at the time of the McCarty decision ( In re Marriage of Sheldon, supra, 124
Cal.App.3d at pp. 380-384), unless the member
had preserved the preemption issue. ( In re
Marriage of Jacanin (1981) 124 Cal.App.3d 67,
70-71 [177 Cal.Rptr. 86].) Federal courts agreed.
( Wilson v. Wilson (5th Cir. 1982) 667 F.2d 497
[cert. den. 458 U.S. 1107 (73 L.Ed2d 1368, 102
S.Ct. 3485)]; Erspan v. Badgett (5th Cir. 1981)
659 F.2d 26, 28 [cert. den. 455 U.S. 945 (71
L.Ed.2d 658, 102 S.Ct. 1443)]; Marriage of Smith
(W.D.Tex. 1982) 549 F.Supp. 761, 767.)
4. Courts of Appeal with rare unanimity,
seized on FUSFSPA to obliterate all traces of
McCarty. (In reMarriage of Sarles (1983) 143
Cal.App.3d 24, 26-30 [191 Cal.Rptr. 514]; In re
Marriage of Ankenman (1983) 142 Cal.App.3d
833, 836-838 [191 Cal.Rptr. 292}; In re Marriage of Fransen (1983) 142 Cal.App.3d 419, 427
[190 Cal.Rptr. 885}; In re Marriage of Hopkins
(1983) 142 Cal.App.3d 350, 353-361 [191
Cal.Rptr. 70}; In reMarriage of Frederick (1983)
141 Cal.App.3d 876, 879-880 [190 Cal.Rptr.
588}; In re Marriage of Buikema (1983) 139
Cal.App.3d 689, 691 [188 Cal.Rptr. 856}.)
5. This pretty much reduced the impact of
McCarty to judgments which became fmal between June 25, 1981, the date of that decision,
and February I, 1983, the effective date of
FUSFSP A. The few unfortunate nonmember
spouses whose judgments did became fmal between those dates, were given special permission
by the California Legislature to ask that the
judgments be modified "to include a division of
military retirement benefits payable on or after
February I, 1983, ... " (Civ. Code,§ 5124, added
by Stats. 1983, ch. 775, § I, p. 2853.)
It is noted that this court has yet to speak on
the matters covered in this footnote. Our purpose in referring to the various authorities is not
to present them as immutably correct, but as indicative of general dissatisfaction with McCarty.
The judgment is reversed.
DISSENT BY: REYNOSO
DISSENT
REYNOSO, J. I respectfully dissent. With the exception of the majority opinion, I know of no case which
suggests that an attorney whose advice is correct may be
held liable for malpractice.
[*423] Relying on the standard developed in
Smith v. Lewis (1975) 13 Cal.3d 349 [118 Cal.Rptr. 621,
530 P.2d 589, 78 A.L.R.3d 231] and its progeny, 1 the
majority concludes that an attorney may face malpractice
liability despite the fact that the law is ultimately re-
Page 7
38 Cal. 3d 413, *; 696 P.2d 656, **;
212 Cal. Rptr. 162, ***; 1985 Cal. LEXIS 268
solved in accordance with the advice given. Although
this application of the Smith standard follows logically
from its emphasis on the duty of care owed a client, it
nonetheless raises a troubling anomaly: where the law is
unsettled, the attorney who gives advice later determined
to be correct may well have committed malpractice,
while the attorney whose advice turns out to be erroneous may avoid liability entirely.
Prior to Smith attorneys in California were
not liable "for lack of knowledge as to the true
state of the law where a doubtful or debatable
point [was] involved." ( Sprague v. Morgan
(1960) 185 Cal.App.2d 519, 523 [8 Ca/.Rptr.
347}.) Smith modified that rule so that even with
regard to an unsettled area of the law an attorney
is obligated to "undertake reasonable research in
an effort to ascertain relevant legal principles and
to make an informed decision .... " ( Smith, supra, 13 Cal. 3d at p. 359.)
The law cannot tolerate such incongruous results.
As Justice Holmes so aptly observed long ago, "[the] life
of the law has not been logic: it has been experience."
(Holmes, Common Law (1881) p. 1.) Experience now
tells us that the Smith standard, however rational and
well-suited to its original purpose, no longer makes
sense. We must therefore formulate a new standard that
draws a fair and reasonable distinction between culpable
and nonculpable practitioners.
The defect inherent in the Smith standard, made ever
clearer by today's majority opinion, is that the concept of
legal error is confused with that of fault, converting a
[**663] question of law into one of fact. Malpractice
consists of four elements: duty arising out of the attorney-client relationship, breach of that duty, causation and
damages. The second element breaks down further into
two components: legal error and failure to use "such
skill, prudence and diligence as lawyers of ordinary skill
and capacity commonly possess and exercise in the performance of the tasks which they undertake." (Lucas v.
Hamm (1961) 56 Ca/.2d 583, 591 [15 Ca/.Rptr. 821, 364
P.2d 685}.) The first is a question of law, the second a
question of fact.
The question of whether an attorney erred necessarily must be resolved before any issue of negligence
arises. An attorney who renders erroneous advice may
not be negligent in doing so. (See Davis v. Damre/1
(1981) 119 Cal.App.3d 883 [174 Cal.Rptr. 257}.) A second attorney may fail to perform adequate research but
somehow give his client accurate advice. Neither of these
attorneys has committed malpractice. (See Mallen &
Levit, Legal Malpractice (2d ed. 1981) § 250, p. 317.)
[*424] Where the law is settled, it is relatively
easy to determine whether the attorney's advice was erroneous. Problems arise only with respect to issues of
law that are unresolved or in a state of flux at the time
the advice is given. In either instance, however, the
question of whether the advice was wrong is a question
oflaw.
[***169] Ironically, Smith itself reflects this basic
approach. At the outset of the analysis the court
stressed: "the crucial inquiry is whether his advice was
so legally deficient when it was given that he may be
found to have failed to use 'such skill, prudence, and diligence as lawyers of ordinary skill and capacity commonly possess and exercise in the performance of the
tasks which they undertake.' [Citation.] We must, therefore, examine the indicia of the law which were readily
available to defendant at the time he performed the legal
services in question." (Jd, at p. 356.) (Italics added.)
Thus, Smith initially proposed a two-step test for
determining whether an attorney has been negligent. As
noted, the threshold inquiry is a legal one, whether adequate legal authority existed at the time to support the
advice given. Only when this question is answered in
the negative is it necessary to move to the second part of
the test, the factual inquiry as to whether the attorney
breached the standard of care in rendering the erroneous
advice.
Applying this test to the case at bar reveals that Attorney Mash did not err in advising his client in 1971 that
her husband's federal military pension was not community property. As the majority notes, "[in] 1971, the California view regarding the characterization of vested federal military retirement pensions as community or separate property was unsettled." (Ante, p. 416.) In fact, Mash
relied on an opinion of this court, French v. French
(1941) 17 Ca/.2d 775 [112 P.2d 235, 134 A.L.R. 366}, in
concluding that the pension was not divisible. As
French remained good law, this reliance was neither
unreasonable nor erroneous. Because Mash committed
no error, the malpractice claim must fail.
It is imperative that a lawyer remain free to choose
one of a number of reasonable and legally supportable
solutions to an otherwise unsettled legal question and
advise the client accordingly without facing a malpractice suit.
Westlaw,
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
c
Missouri Court of Appeals,
Southern District,
Division Two.
BACA CHIROPRACTIC, P.C.,
Plaintiff-Respondent,
v.
Jerry COBB and Christie Cobb, Defendants-Appellants.
No. SD 30271.
Aug. 16, 2010.
Background: Chiropractor brought collection action against husband and wife patients. The Circuit
Court, Christian County, JohnS. Waters, J., granted
summary judgment in favor of chiropractor in the
amount of $6,533.17, and patients appealed.
Holdings: The Court of Appeals, Gary W. Lynch,
P.J., held that:
(1) patients' counteraffidavits were properly before
the Circuit Court, as required to challenge allegations fees were reasonable;
(2) patients were qualified to assert chiropractor's
fees were unreasonable; and
(3) genuine issue of material fact as to reasonableness of chiropractor's fees precluded summary
judgment.
Reversed and remanded.
West Headnotes
[1] Account, Action On 10 €= 2
I 0 Account, Action On
lOki Open Accounts in General
1 Ok2 k. Nature and grounds of action. Most
Cited Cases
An action on account is an action based in contract.
[2] Account, Action On 10 €= 3
Page 1
10 Account, Action On
lOki Open Accounts in General
1 Ok3 k. Requisites of account. Most Cited
Cases
There are three elements that must be proven in
a suit on open account: ( 1) the defendant requested
the plaintiff to furnish goods or services, (2) the
plaintiff accepted the defendant's offer by furnishing the goods or services, and (3) the charges were
reasonable.
[3] Judgment 228 €= 185.1(1)
228 Judgment
228V On Motion or Summary Proceeding
228kl82 Motion or Other Application
228kl85.1 Affidavits, Form, Requisites
and Execution of
228k185.1(1} k. In general. Most Cited
Cases
Trial court considered patients' summary judgment counteraffidavits as having been timely filed,
and thus, counteraffidavits were properly before the
trial court, by leave of court, as required to challenge chiropractor's allegations that the amount
charged for his chiropractic treatments was reasonable or that the treatments were necessary, where
the court articulated in its judgment that it had considered the patients' response, and the documents
attached, which included patients' counteraffidavits.
V.A.M.S. § 490.525(5)(2).
[4] Judgment 228 €= 185.1(2)
228 Judgment
228V On Motion or Summary Proceeding
228kl82 Motion or Other Application
228kl85.1 Affidavits, Form, Requisites
and Execution of
228kl85.1(2) k. Persons who may
make affidavit. Most Cited Cases
Judgment 228 €= 185.3(3)
228 Judgment
© 2012 Thomson Reuters. No Claim to Orig~ US Gov. Works.
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
228V On Motion or Summary Proceeding
228k182 Motion or Other Application
228k185.3 Evidence and Affidavits in
Particular Cases
228k185.3(3) k. Accounting and accounts. Most Cited Cases
Patients were qualified to assert in their summary judgment affidavits that chiropractor's
charges for his services to patients was unreasonable, by reason of patients' personal knowledge of
and personal experience with chiropractor's prior
rates, and his promise to adhere to those prior rates
during patients' post-accident treatment. V.A.M.S.
§ 490.525(6).
[5] Judgment 228 C=> 181(15.1)
228 Judgment
228V On Motion or Summary Proceeding
228k181 Grounds for Summary Judgment
228k181(15) Particular Cases
228k 181 ( 15.1) k. In general. Most
Cited Cases
Genuine issue of material fact as to the reasonableness of fees charged by chiropractor precluded
summary judgment in chiropractor's collection action.
*675 James E. Corbett, David T. Tunnell, Matthew
W. Corbett, and Daniel P. Molloy, Corbett Law
Firm, Springfield, MO, for Appellant.
Raymond Lampert, Springfield, MO, for Respondent.
GARY W. LYNCH, Presiding Judge.
Jerry Cobb and Christie Cobb (individually,
"Jerry" and "Christie," and collectively, "the
Cobbs") appeal the trial court's judgment granting
Baca Chiropractic, P.C.'s motion for summary judgment and awarding it $6,533.17 in unpaid fees. The
Cobbs argue that the trial court erred in granting
summary judgment because there was a genuine
dispute as to whether the fees charged by Baca
Chiropractic were reasonable, and therefore it was
Page2
not entitled to judgment as a matter of law. We
agree, reverse the trial court's judgment, and remand for further proceedings.
Factual and Procedural Background
The Cobbs were in an automobile accident on
May 29, 2004. Before that accident, from May 4,
2001, to December 20, 2002, both had received
chiropractic treatment from Steven Baca, a chiropractor and the owner of Baca Chiropractic. Following the accident, the Cobbs again received treatment from Dr. Baca, this time from August 3, 2004,
to March 3, 2005.
Dr. Baca sent the Cobbs a letter requesting
payment on their outstanding account balances for
treatment following the accident, which amounted
to $3,485.00 on Christie's account, and $1,415.00
on Jerry's account, for a total of $4,900.00. In that
letter, Dr. Baca gave the Cobbs until January 2,
2008, to contact his office regarding payment of the
accounts or he would tum the accounts over to his
collections attorney. On January 10, 2008, Creditors Financial Services, L.L.C., sent the Cobbs a letter demanding payment in the amount of $6,533.17;
that letter did not contain an itemization of the
charges.
*676 The following month, Baca Chiropractic
filed a two-count petition against the Cobbs. Count
I alleged that the Cobbs owed Baca Chiropractic
$6,533.17, which included "reasonable collection
fees," and that both individuals should be held liable for the entire amount. Count II alleged that the
Cobbs were unjustly enriched by accepting Dr.
Baca's treatment without submitting payment. Attached to the petition was the sworn affidavit of Dr.
Baca averring that he had provided the requested
services, that his fees were reasonable, and that the
Cobbs refused to pay; an "itemized and true copy of
the account[s]"; a "Doctor's Lien" relating to
Christie and a "Clinic Lien" relating to Jerry; health
history questionnaires for both Cobbs; a request for
Jerry's medical records; and the two collection letters described supra.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
In their answer, the Cobbs contended that the
fees sought were unreasonable as the fees were the
product of "price gouging," that they were charged
different rates before and after their accident, that
Baca Chiropractic charged the higher rate after the
accident because it "thought it could engage in
price gouging," that they were not made aware of
the price difference until after their treatment, and
that they would not have continued with treatment
from Dr. Baca had they known about the increased
prices.
Baca Chiropractic then filed a motion for summary judgment, arguing that
[t]he [Cobbs] have admitted in their pleadings
and in discovery that Baca offered and they accepted the services and they promised to pay the
bill. They have not contradicted the reasonable
charges affidavit. There is therefore no genuine
issue of material fact and the Court should enter
judgment in favor of [Baca Chiropractic] for the
full amount due plus attorney fees.
Baca Chiropractic went on to argue that, even
though "[i]n their answer, the [Cobbs] denied that
[the] charges are reasonable[, n]evertheless they
have not provided the affidavit required under §
490.525.2 to rebut the established presumption of
reasonableness. FNl Because [Baca Chiropractic]
has filed the required affidavit there is sufficient
evidence to support that the charges were reasonable." Accompanying Baca Chiropractic's motion
for summary judgment was "Plaintiff's Statement of
Facts," which alleged three facts: "1. [The Cobbs]
requested that [Baca Chiropractic] provide them
chiropractic services, and [Baca Chiropractic]
provided said services to [the Cobbs]"; "2. [Baca
Chiropractic's] charges for said services were reasonable[;]" and "3. Said charges were not paid."
These facts were supported by citation to the pleadings, Dr. Baca's affidavit, and deposition testimony
of both Jerry and Christie, portions of which were
also attached to the motion for summary judgment.
FN1. All statutory references are to RSMo
Page3
Cum.Supp.2004, unless otherwise indicated.
The Cobbs filed their response to the motion
for summary judgment again asserting the unreasonableness of Dr. Baca's charges. Attached to this
motion were Jerry's affidavit, Christie's affidavit,
and itemized billing statements from Baca Chiropractic from both before and after the automobile
accident.
Along with their response to the motion for
summary judgment, the Cobbs also filed a "Motion
for Leave of Court to File Counteraffidavits Pursuant to RSMo. § 490.525.5 Out of Time." The counteraffidavits referred to in and attached to this motion were the same affidavits of Jerry and Christie
that were referenced in and *677 attached to their
response to the motion for summary judgment.
Jerry's and Christie's affidavits aver that Dr.
Baca charged them different rates after the accident
than he had charged before the accident, that Dr.
Baca had represented to the Cobbs that he would
charge them the same rates as he had charged before the accident, that the ultimate fees sought were
unreasonable, that neither Christie nor Jerry would
have treated with Dr. Baca had they known what
the charges would be, and that they believed Dr.
Baca charged higher rates because he knew an insurance company would be paying the bill.
The trial court granted Baca Chiropractic's motion for summary judgment and entered judgment
accordingly on December 3, 2009. In its judgment,
the trial court awarded Baca Chiropractic
$6,533.17, the amount requested in its petition,
against the Cobbs. This appeal timely followed.
Standard of Review
In reviewing a trial court's grant of a motion for
summary judgment, "we employ a de novo standard
of review." Neisler v. Keirsbilck, 307 S.W.3d 193,
194 (Mo.App.2010) (citing City of Springfield v.
Gee, 149 S.W.3d 609, 612 (Mo.App.2004)). As
such, we will not defer to the trial court's decision,
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
Murphy v. Jackson Nat'/ Life Ins., Co., 83 S.W.3d
663, 665 (Mo.App.2002), but rather, we will use
the same standards the trial court should have used
in reaching its decision to grant the motion for summary judgment. Stormer v. Richfield Hospitality
Servs., Inc., 60 S.W.3d 10, 12 (Mo.App.2001). "We
view the record in the light most favorable to the
party against whom judgment was entered, and we
accord that party the benefit of all inferences which
may reasonably be drawn from the record." Neisler,
307 S.W.3d at 194-95 (citing ITT Commercial Fin.
Corp. v. Mid-Am. Marine Supply Corp., 854
S.W.2d 371, 376 (Mo. bane 1993)). "The propriety
of summary judgment is purely an issue of law."
ITT Commercial Fin. Corp., 854 S.W.2d at 376.
Discussion
In their sole point relied on, the Cobbs contend
that the trial court erred in granting Baca Chiropractic's motion for summary judgment because
there was a genuine issue of material fact as to
whether its charges were reasonable. We agree.
To be entitled to summary judgment under
Rule 74.04 as a claimant, the movant must establish that (1) it is entitled to judgment as a matter
of law and (2) there is no genuine dispute as to
the material facts upon which it would have the
burden of persuasion at trial.... Once the movant
has made this prima facie showing as required by
Rule 74.04, the non-movant must demonstrate
that one or more of the material facts asserted by
the movant as not in dispute is, in fact, genuinely
disputed.... The non-moving party may not rely
on mere allegations and denials of the pleadings,
but must use affidavits, depositions, answers to
interrogatories, or admissions on file to demonstrate the existence of a genuine issue for trial.
Midwestern Health Mgmt., Inc. v. Walker, 208
S.W.3d 295, 297 (Mo.App.2006) (internal citations
omitted).
Here, in order to make a prima facie case for
summary judgment on its open account action,
Baca Chiropractic was required to plead in its sumPage4
mary judgment motion all of the facts necessary to
establish each and every element of its claim, referencing any pertinent pleadings, discovery, or affidavits. ITT Commercial Fin. Corp., 854 S.W.2d at
380.
*678 [1][2] "An action on account is an action
based in contract." Midwestern Health Mgmt., Inc.,
208 S.W.3d at 297 (citing Heritage Roofing, L.L.C.
v. Fischer, 164 S.W.3d 128, 133 (Mo.App.2005);
St. Luke's Episcopal-Presbyterian Hosp. v. Underwood, 957 S.W.2d 496,498 (Mo.App.1997)). There
are three elements that must be proven in a suit on
open account: "(1) the defendant requested the
plaintiff to furnish goods or services, (2) the
plaintiff accepted the defendant's offer by furnishing the goods or services, and (3) the charges were
reasonable." Id.
In its motion for summary judgment, Baca
Chiropractic alleged all three of these elements
with references to the applicable documents, including Dr. Baca's affidavit, which stated that the
fees Baca Chiropractic charged the Cobbs for chiropractic services "were reasonable[.]" Dr. Baca's affidavit was the only evidence offered by Baca
Chiropractic in support of its contention that the
fees it charged the Cobbs were reasonable. In their
response, the Cobbs admitted both that they had requested treatment from Dr. Baca and that treatment
was provided; the only element of Baca Chiropractic's claim that they disputed was that the charges
were reasonable.
Section 490.525 provides that,
[ u ]nless a controverting affidavit is filed as
provided by this section, an affidavit that the
amount a person charged for a service was reasonable at the time and place that the service was
provided and that the service was necessary is
sufficient evidence to support a fmding of fact by
judge or jury that the amount charged was reasonable or that the service was necessary.
Section 490.525.2. Thus, as expressly provided
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
in this statute, absent a "controverting affidavit,"
Baca Chiropractic's use of Dr. Baca's affidavit as to
the reasonableness of the charges provided sufficient evidence to support its motion for summary
judgment. The Cobbs, however, filed a controverting affidavit.
Section 490.525 states:
5. A party intending to controvert a claim reflected by the affidavit shall file a counteraffidavit
with the clerk of the court and serve a copy of the
counteraffidavit on each other party or the party's
attorney of record:
(1) Not later than:
(a) Thirty days after the day he receives a copy
of the affidavit; and
(b) At least fourteen days before the day on
which evidence is first presented at the trial of
the case; or
(2) With leave of the court, at any time before
the commencement of evidence at trial.
Section 490.525.5.
[3] Baca Chiropractic first argues that the
Cobbs filed their counteraffidavits out of time. The
Cobbs admit that they did not file their counteraffidavits within the time required by section
490.525.5(1). The Cobbs contend, however, and we
agree, that the trial court treated their counteraffidavits as having been timely filed, and thus the
counteraffidavits were properly before the trial
court by leave of court, in accordance with section
490.525.5(2). While there was no express ruling by
the trial court on the Cobbs' motion for leave to file
the counteraffidavits out of time, the trial court articulated in the judgment that it had "considered
said Motion [for summary judgment] and [the
Cobbs'] Response, the documents attached thereto,
and the arguments of counsel." (Emphasis added).
Because the documents attached to the Cobbs' response included the counteraffidavits, the trial
Page5
court's consideration of them implicitly granted the
Cobbs' motion for leave to file them out of time in
*679 accordance with section 490.525.5(2). Cf
Premier Golf Missouri, LLC v. Staley Land Co.,
L.L.C., 282 S.W.3d 866, 871 (Mo.App.2009) (grant
of motion for summary judgment on petition implicitly denied motions for summary judgment on
counterclaims involving the same issues and evidence); State v. Tidwell, 888 S.W.2d 736, 743
(Mo.App.l994) (grant of motion for continuance
for the purpose of obtaining defendant's blood
sample implicitly granted pending motion for order
requiring defendant to submit blood sample); Midwest Materials Co. v. Viii. Dev. Co., 806 S.W.2d
477, 501 (Mo.App.l991) (finding of lack of bias
and prejudice was implicit in the trial court's overruling of the motion for new trial).
[ 4] Baca Chiropractic next argues that, even if
the affidavits were considered timely, the Cobbs
were not qualified to make such affidavits as they
are not "experts" within the meaning of the statute.
The statute, in pertinent part, provides:
6. The counteraffidavit shall give reasonable notice of the basis on which the party filing it intends at trial to controvert the claim reflected by
the initial affidavit and must be taken before a
person authorized to administer oaths. The counteraffidavit shall be made by a person who is
qualified, by knowledge, skill, experience, training, education or other expertise, to testify in
contravention of all or part of any of the matters
contained in the initial affidavit.
Section 490.525.6.
Baca Chiropractic contends that "a non-expert
is not competent to testify that a professional's
charge for his services is unreasonable." The statute, however, is void of any reference to an
"expert"; rather, the statute requires that a counteraffidavit "be made by a person who is qualified, by
knowledge, skill, experience, training, education or
other expertise, to testify in contravention of all or
part of any of the matters contained in the initial af-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
317 S.W.3d674
(Cite as: 317 S.W.3d 674)
fidavit." Section 490.525.6. Under the unique facts
in this case, we find that the Cobbs were qualified
to make such an affidavit by reason of their personal knowledge of and personal experience with Baca
Chiropractic's prior rates and Dr. Baca's promise to
adhere to those prior rates during the Cobbs' postaccident treatment. The facts in the counteraffidavits support that Jerry and Christie were treated
by Dr. Baca for a lengthy period of time before
their accident, during which they were charged a
certain amount for particular services; after their
accident, Dr. Baca told the Cobbs that he would
charge the same amount for the same services; and
Dr. Baca instead charged the Cobbs a higher
amount than he had previously charged them for the
same services. Under this set of facts, the Cobbs
were uniquely qualified to specifically contest the
reasonableness of Baca Chiropractic's fees based
upon their knowledge and experience.
[5] As the counteraffidavits were properly before the trial court, all that remains to be determined is whether the contents of the Cobbs' counteraffidavits raise a genuine issue of material fact as to
the reasonableness of Baca Chiropractic's fees. "A
'genuine issue' exists where the record contains
competent evidence of 'two plausible, but contradictory, accounts of the essential facts.' " Robinson
v. Mo. State Highway & Transp. Comm'n, 24
S.W.3d 67, 75-76 (Mo.App.2000) (quoting /IT
Commercial Fin. Corp., 854 S.W.2d at 382). "A
'genuine issue' is a dispute that is real, not merely
argumentative, imaginary or frivolous." /d.
Here, both Jerry and Christie aver that Dr. Baca
told them "he would charge the same rates postaccident as he did pre-*680 accident[,]" but that Dr.
Baca "charged higher rates for the treatment
provided after the automobile accident compared
with the rates he charged prior to the automobile
accident." Belief of these facts would support an inference that Baca Chiropractic's fees in excess of
those agreed to be charged are unreasonable. Therefore, these facts contradict the conclusory inference
in Dr. Baca's affidavit that the fees were
Page6
"reasonable." This contradiction raises a genuine
issue of material fact as to the reasonableness of the
fees and, accordingly, summary judgment was inappropriate. The Cobbs' point is granted.
Decision
The trial court's judgment is reversed, and the
case is remanded for further proceedings not inconsistent with this opinion.
SCOTT, C.J., and RAHMEYER, J., concur.
Mo.App. S.D.,2010.
Baca Chiropractic, P.C. v. Cobb
317 S.W.3d 674
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page I
LexisNexis®
DONNA BALL, as Administratrix With the Will Annexed, etc., Plaintiff and Respondent, v. DAN T. POSEY, Defendant and Appellant
No. A026068
Court of Appeal of California, First Appellate District, Division Four
176 Cal. App. 3d 1209; 222 CaL Rptr. 746; 1986 Cal. App. LEXIS 2516
January 29, 1986
PRIOR HISTORY: [***1] Superior Court of the
City and County of San Francisco, No. 780206, Morton
R. Colvin, Judge.
DISPOSITION: The judgments are affirmed.
SUMMARY:
CALIFORNIA OFFICIAL REPORTS SUMMARY
An award of compensatory and punitive damages
was entered against an attorney on causes of action for
conversion, breach of fiduciary duty, and fraudulent disposition of a client's property. (Superior Court of the City
and County of San Francisco, No. 780206, Morton R.
Colvin, Judge.)
The Court of Appeal affirmed, holding that, because
defendant was a fiduciary as to his client, the jury was
properly instructed that a presumption of undue influence
arose from that relationship. The court also held that the
jury was qualified to determine the value of legal services defendant had rendered the client, that the evidence
that defendant had misappropriated an inheritance check
was sufficient, and that the award of punitive damages
bore a reasonable relationship to the compensatory damages in light of defendant's behavior. (Opinion by Channell, J., with Anderson, P. J., and Sabraw, J., concurring.)
HEAD NOTES
CALIFORNIA OFFICIAL REPORTS HEADNOTES
Classified to California Digest of Official Reports, 3d
Series
(1) Appellate Review § 133 -- Review -- Standing to
Allege Errors -- Estoppel and Waiver. --In an action
against an attorney for conversion, breach of fiduciary
duty and fraudulent disposition of a client's property, in
which action the trial court entered a judgment based on
the jury's verdict and subsequently entered a second
judgment awarding prejudgment interest, defendant
waived the interest award issue on appeal pursuant to
Code Civ. Proc., § 906 (specifying what matters are reviewable), notwithstanding that he purported to appeal
from both judgments, where he did not raise the interest
award issue.
(2a) (2b) (2c) Attorneys at Law§ 12 --Attorney-client
Relationship-- Dealings With Clients -- Presumption
of Undue Influence. --In an action against an attorney
for conversion, breach of fiduciary duty and fraudulent
disposition of a client's property, the jury was properly
instructed that a presumption of undue influence applies
to all dealings between an attorney and a client for the
attorney's benefit, where defendant was hired to settle the
estate of an elderly woman's deceased husband, where in
all transactions forming the basis of the action defendant
had himself appointed the woman's agent by reason of a
signed power of attorney, and where at trial defendant
admitted he never advised the client to obtain separate
counsel when his name appeared as joint tenant on her
bank accounts shortly before her death.
[Undue influence in gift to testator's attorney, note,
19 A.L.R.3d 575.]
(3) Attorneys at Law § 10 -- Attorney-client Relationship -- Fiduciary Nature. --The attorney-client
relationship is a fiduciary relationship of the highest
character.
Page 2
176 Cal. App. 3d 1209, *; 222 Cal. Rptr. 746, **;
1986 Cal. App. LEXIS 2516, ***
(4) Trusts § 9 - Transactions Between Persons in
Trust Relationship - Presumption of Undue Influence. --When a fiduciary gains an advantage, a presumption of undue influence arises.
(5) Trusts § 9 -- Transactions Between Persons in
Trust Relationship - Presumption of Undue Influence. --To declare that an advantage obtained by a fiduciary must be shown to be unfair, unjust, or inequitable before the presumptions of Civ. Code, § 2235
(providing that transactions in which a trustee obtains an
advantage over his beneficiary are presumed to be entered into without sufficient consideration and under
undue influence), arise would result in the imposition of
a condition that is not required by§ 2235.
(6) Trusts § 9 - Transactions Between Persons in
Trust Relationship - Disclosure. --The duty of a fiduciary embraces the obligation to render a full and fair
disclosure to the beneficiary of all facts that materially
affect his rights and interests.
(7) Attorneys at Law § 12 -- Attorney-client Relationship - Dealings With Client - Duty to Inform.
--An attorney must demonstrate that his client was fully
informed in all matters related to any transactions between them.
(Sa) (8b) Attorneys at Law § 32 -- Attorney-client
Relationship -- Compensation of Attorneys - Determination of Amount of Reasonable Fee -- Expert Testimony. --Expert testimony as to the reasonable value
of an attorney's legal services is unnecessary, and the
trial court's fmdings of fact on this matter carmot be disturbed absent a clear abuse of discretion. Thus, in an
action against an attorney for conversion, breach of fiduciary duty and fraudulent disposition of a client's property, an award to plaintiff based on the unjustified size of
fees defendant collected from his elderly client to settle
an estate, was not an abuse of discretion, notwithstanding
that no expert testimony on this question was presented,
where defendant claimed he gave his since-deceased
client a bill in a specified amount but produced no evidence of this at trial, and where he never explained why
the client paid substantially more than the bill.
(9) Evidence § 81 - Opinion Evidence -- Expert Witnesses - Where Question Is Resolvable by Common
Knowledge. --Expert testimony is not required where a
question is resolvable by common knowledge.
(10) Conversion § 6 -- Pleading and Proof - Sufficiency of Evidence - Misappropriation of Client's
Money by Attorney. --In an action against an attorney
for conversion, breach of fiduciary duty and fraudulent
disposition of a client's property, there was sufficient
evidence to support the jury's award based on defendant's
misappropriation of an inheritance check, where defendant never deposited the proceeds of the check to the bank
accounts of his client, an elderly woman in a convalescent hospital, and failed to produce evidence to prove his
claim that he delivered the proceeds to her in cash.
(11) Conversion § 7 -- Damages -- Allowing Defendant Credit for Tax Paid. --In an action against an attorney for conversion, breach of fiduciary duty and
fraudulent disposition of a client's property, in which
action plaintiff was awarded compensatory and punitive
damages, it was not error to have refused to allow defendant credit for taxes paid on the money of his client
which he held in joint tenancy with her, where he presented no evidence beyond his own testimony that he
made any tax payment.
(12) Damages § 24 -- Exemplary or Punitive Damages
-- Relation to and Requirement of Actual Damages.
--In an action against an attorney for conversion, breach
of fiduciary duty and fraudulent disposition of a client's
property, the award of$ 40,000 in punitive damages bore
a reasonable relationship to the compensatory damages
award of$ 43,746.73, in light of defendant's behavior,
which consisted of overbilling and misappropriating the
money of an elderly client.
COUNSEL: Dan T. Posey, in pro. per., and Robert N.
Beechinor for Defendant and Appellant.
Bernadine Bushman Guidotti for Plaintiff and Respondent.
JUDGES: Opinion by Charmell, J., with Anderson, P. J.,
and Sabraw, J., concurring.
OPINION BY: CHANNELL
OPINION
[*1212) [**747] (1) (See fn. 1.) Dan T. Posey,
a California attorney, appeals from judgments 1 against
him for conversion, breach of fiduciary duty and fraudulent disposition of a client's property. He contends that:
(I) the jury was improperly instructed on the presumption of undue influence; and (2) the plaintiff [**748]
failed to sustain her burden of proof as to damages.
Neither claim is meritorious, and consequently we affirm
the judgments.
The trial court entered a judgment based on
the jury's verdict, and subsequently entered a second judgment awarding prejudgment interest.
Though appellant purports to appeal from both
Page 3
176 Cal. App. 3d 1209, *; 222 Cal. Rptr. 746, **;
1986 Cal. App. LEXIS 2516, ***
judgments, he does not raise the interest award
issue, and he therefore waives it. ( Code Civ.
Proc., § 906.)
[***2] I. Facts
Respondent, Donna Ball, 2 is the administratrix with
the will annexed of the estate of Jeannette Watkins Ball
(hereafter Mrs. Ball).
2 Donna Ball is the daughter-in-law of decedent, Mrs. Ball. She is also the widow of Donald Ball, who was the son of Mrs. Ball and her
husband, Arthur Cameron Ball.
Mrs. Ball was an elderly woman in poor health.
She suffered from a number of ailments for which she
had been hospitalized at least 11 times in the last five
years of her life. She took pain medication several
times daily, occasionally combining it with alcohol.
In 1975 and again in 1978, Arthur and Jeannette Ball
had Posey prepare their reciprocal wills. Shortly after
Arthur died in 1979, Mrs. Ball hired Posey to settle Arthur's estate. That estate consisted solely of community
property, principally cash and securities, all held in joint
tenancy with Mrs. Ball. Posey performed a number of
routine tasks to terminate the joint tenancies. 3 Mrs. Ball
paid $ 6,620 for these services, though Posey claims
[***3] he gave her a bill for only $ 2,500. A jury
found these services worth no more [*1213] than $
1,135. (See fu. 4, post.) This was but one in a series of
transactions, the most egregious of which are described
below, that amounted to undue influence on Mr. Posey's
part.
3 Posey also prepared a United States Estate
Tax Return (Form 706) for Mrs. Ball's signature.
However, this was unnecessary because Arthur's
total gross estate was below the minimum to require such a return.
I. In January 1980, Mrs. Ball signed a power of attorney, prepared by Posey, appointing him as her attorney in fact.
2. On March 4, 1980, Posey had Mrs. Ball send a
letter, addressed to the manager of the apartment building, advising that he, Posey, should have access to her
apartment in the event of her incapacity. She countersigned the letter. (Six months later Posey was careful to
draw up, and have Mrs. Ball sign, a similar letter to the
manager of the hotel that was then her residence.)
3. On the same day Posey presented [***4] her
with the first letter to her landlord, he provided Mrs. Ball
with a new will that named himself as executor. This,
too, she signed.
4. Still the same day, March 4, 1980, documents
were deposited with Mrs. Ball's bank naming Posey as
the joint tenant on both her checking and savings accounts. They were signed by both Posey and Mrs. Ball.
5. In November, Mrs. Ball inherited$ 1,125. She
endorsed the check she received and gave it to Mr. Posey
to cash for her. Instead of giving her the proceeds,
Posey bought a cashier's check payable to a third party.
6. On December 26, 1980, the day Mrs. Ball died,
Posey improperly obtained from the county treasurer's
office in San Francisco a consent to transfer all the
money in Mrs. Ball's accounts to himself. On January 5,
1981, Posey withdrew all the money, over $ 37,000,
from those accounts.
Between the day Mrs. Ball died and the day Posey
emptied all her accounts Posey had the apartment sealed,
and refused access to Donna Ball and her children. This
was despite Donna Ball's warning that maintaining the
apartment would result in another month's rent being
charged.
At trial, the jury awarded $ 43,746.73 • compensatory damages on three [***5] causes of action: (1) for
recovery ofthe $37,136.73 in Mrs. Ball's bank accounts;
(2) for the proceeds of the$ 1,125 inheritance check; and
(3) for the return of excessive fees charged [**749] in
the amount of$ 5,620. The jury also awarded $ 40,000
punitive damages.
4 Full recovery on these three causes of action
would have been$ 135 more than the verdict. It
may be that out of the $ 6,620 paid for fees, the
jury was requiring Posey to return slightly less
than the $ 5,620 sought in the complaint. The
record on this matter is not clear.
[*1214] II. Presumptions ofUndue Influence
(2a) Posey contends that the jury was improperly
instructed that there was a presumption of undue influence. He argues that since he never entered into a contract, joint venture, or agreement with Mrs. Ball, any
such presumption was incorrectly applied to his relationship with her. The cases, including those Posey
cites, do not support this view.
(3) First of all, Posey was Mrs. Ball's attorney.
[***6] This alone creates a fiduciary relationship that
should be of the highest character. ( Nee/ v. Magana,
Olney, Levy, Cathcart & Gelfand (1971) 6 Ca/.3d 176,
188-189 {98 Cal.Rptr. 837, 491 P.2d 421}.) (2b) Further, at the time of all the transactions that form the basis
of this case, Posey was Mrs. Ball's agent by reason of the
signed power of attorney, as well as the fact that he was
the named executor of her will.
Page 4
176 Cal. App. 3d 1209, *; 222 Cal. Rptr. 746, **;
1986 Cal. App. LEXIS 2516, ***
( 4) When a fiduciary gains an advantage, a presumption of undue influence arises. ( Bradner v.
Vasquez (1954) 43 Ca/.2d 147, 151 [272 P.2d 11}.) (5)
"To declare that the advantage obtained must be shown
to be unfair, unjust, or inequitable before the presumptions arise would result in the imposition of a condition
which is not required by [Civil Code} section 2235." s (
Id, at p. 152.)
5 Civil Code section 2235 reads in pertinent
part: "All transactions between a trustee and his
beneficiary during the existence of the trust, or
while the influence acquired by the trustee remains, by which he obtains any advantage from
his beneficiary, are presumed to be entered into
by the latter without sufficient consideration, and
under undue influence."
[***7] (2c) Posey cites Gold v. Greenwald
(1966) 247 Cal.App.2d 296 [55 Cal.Rptr. 660], in support of his argument. However, that case stands for the
proposition that a presumption of undue influence applies to all dealings between an attorney and a client for
the attorney's benefit.
At trial, Posey admitted that he had never advised
Mrs. Ball to obtain separate counsel when his name appeared as the joint tenant on her bank accounts. (6)
However, "[the] duty of a fiduciary embraces the obligation to render a full and fair disclosure to the beneficiary
of all facts which materially affect his rights and interests." (Nee/ v. Magana, Olney, Levy, Cathcart & Gelfand, supra, 6 Ca/.3d at pp. 188-189.) Even the lack of
full disclosure will amount to fraud, because the fiduciary's obligation is affirmative. (7) The attorney must
demonstrate that the client was fully informed on all
matters related to any transactions between them. ( Id,
at p. 189; see also Gold v. Greenwald, supra, 247
Cal.App.2d at p. 306.) Posey has failed to do this.
[*1215] Ill. Compensatory Damages
(8a) Posey next [***8] contends that the jurors
were not qualified to determine the value of the legal
services he performed for Mrs. Ball.
Posey claimed that he gave Mrs. Ball a bill for $
2,500, but he produced no evidence of this at trial.
Posey never explained why Mrs. Ball paid$ 4,120 more
than the amount of his bill. Furthermore, Posey's calculation of his fee was based on the entire estate, not just
that of Mrs. Ball's deceased husband. Posey even prepared and had Mrs. Ball sign unnecessary documents.
(See fu. 3, ante.)
Expert testimony was not needed to determine the
value of the few proper services Mr. Posey performed.
All the facts were before the jury, and it generously allowed him to keep over$ 1,000. (See fu. 4, ante.) "The
correct rule on the necessity of expert testimony has been
summarized by Bob Dylan: 'You don't need a weatherman to know which way the wind blows.' 6 (9) The California courts, although in harmony, express the rule
somewhat [**750) less colorfully and hold expert testimony is not required where a question is 'resolvable by
common knowledge'. [Citations omitted.]" (Jorgensen v.
Beach 'N' Bay Realty, Inc. (1981) 125 Cal.App.3d 155,
163 [177 Cal.Rptr. 882}.) [***9)
6 In a footnote at this point, the court cites:
"Bob Dylan, 'Subterranean Homesick Blues' from
Bringing it All Back Home."
More specifically, in Bunn v. Lucas, Pino & Lucas
(1959) 172 Cal.App.2d 450 {342 P.2d 508], the court
held that "[expert] testimony as to the reasonable value
of attorney's legal services is unnecessary. [Citations.]"
( Id, at p. 468.) The trial court's fmdings of fact on this
matter cannot be disturbed absent a clear abuse of discretion. (8b) This award constituted no such abuse of
discretion.
(10) Posey also contends that the jury had insufficient evidence that he misappropriated the inheritance
check. We are not convinced. The proceeds of the
check were never deposited in either of Mrs. Ball's bank
accounts. Posey failed to produce evidence, such as a
receipt, to prove his claim that he returned the proceeds
to Mrs. Ball in cash. Like the jury, we fail to see why
he would have delivered over $ 1,000 in cash to an
[***10) elderly client who was then in a convalescent
hospital, with or without a receipt. In fact, on the same
day Posey cashed the check, he purchased another one,
of a slightly higher denomination, payable to an unrelated third party. We think there was more than sufficient
evidence to support the jury's award.
[*1216] (11) Posey even argues that he should
have been allowed credit for taxes paid on the money
held in "joint tenancy." Other than his testimony, he had
no evidence he made any tax payment, he cites no authority for this claim, and we fmd it wholly without merit.
IV. Punitive Damages
(12) Finally, Posey contends that the $ 40,000
award of punitive damages is excessive. He cites Rosener v. Sears, Roebuck & Co. (1980) 110 Cal.App.3d
740 [168 Cal.Rptr. 237], for the principle that an award
of punitive damages must bear some reasonable relationship to actual damages. In Rosener, the jury
awarded$ 158,000 compensatory damages and$ 10 million in punitive damages. The court held that this amount
reflected passion and prejudice and that $ 2.5 million
Page 5
176 Cal. App. 3d 1209, *; 222 Cal. Rptr. 746, **;
1986 Cal. App. LEXIS 2516, ***
was more appropriate. ( Id, at pp. 746, 749-750.) We
think (***11) that, in light of Posey's behavior, the
award both bore a reasonable relationship to the compensatory damages award, and reflected the jury's conservatism and restraint.
v.
This court is outraged by the conduct of a member
of the California State Bar, and astonished that he should
have the temerity to appeal the judgments in this case.
We have determined that the State Bar is appropriately
investigating Posey for his conduct that necessitated this
litigation. If this were not the case we would make such
a recommendation.
The judgments are affirmed.
Westlaw,
985 S.W.2d485
(Cite as: 985 S.W.2d485)
H
Court of Appeals of Texas,
San Antonio.
Sandra BALLESTEROS, Appellant,
v.
James K. JONES and The Law Offices of Mann &
Jones, Appellees.
No. 04-91-00568-CV.
Nov. 18, 1998.
Rehearing Overruled Jan. 26, 1999.
Client filed action against attorney asserting
legal malpractice and liability under Deceptive
Trade Practices-Consumer Protection Act (DTP A)
concerning his representation in her prior action for
common law marriage and divorce. After jury returned verdict in favor of client, the 111 th Judicial
District Court, Webb County, Joe Kelly, J., granted
attorney's motion for judgment notwithstanding the
verdict (JNOV). Client appealed. On motion for rehearing en bane, the Court of Appeals, Angelini, J.,
held that: (1) evidence supported fmding on existence of common law marriage; (2) evidence supported finding that attorney was negligent in his
representation of client; (3) contingent attorney fee
contract in underlying action was valid and enforceable; (4) no evidence indicated that conduct of attorney amounted to anything more than negligence,
which thus precluded finding of unconscionability
on part of attorney for purposes of DTPA claim;
and (5) amount of damages sustained by client
presented fact issue for jury.
Affirmed in part and reversed and remanded in
part.
West Headnotes
[1] Appeal and Error 30 E:=> 863
30 Appeal and Error
30XVI Review
30XVI(A) Scope, Standards, and Extent, in
Page 1
General
30k862 Extent of Review Dependent on
Nature of Decision Appealed from
30k863 k. In general. Most Cited
Cases
To sustain the trial court's action in entering a
judgment notwithstanding the verdict (JNOV), the
reviewing court must determine that there is no
evidence to support the jury's fmdings.
[2] Appeal and Error 30 E:=> 934(1)
30 Appeal and Error
30XVI Review
30XVI(G) Presumptions
30k934 Judgment
30k934(1) k. In general. Most Cited
Cases
In reviewing a judgment notwithstanding the
verdict (JNOV), the reviewing court views the
evidence in the light most favorable to the jury's
findings, considering only the evidence and inferences which support them, and rejecting the evidence and inferences contrary to those findings.
[3] Judgment 228 E:=> 199(3.7)
228 Judgment
228VI On Trial of Issues
228VI(A) Rendition, Form, and Requisites in
General
228k199 Notwithstanding Verdict
228k199(3.7) k. Where there is some
substantial evidence to support verdict. Most Cited
Cases
It is error to grant a judgment notwithstanding
the verdict (JNOV) when there is more than a scintilla of evidence to support the jury's finding.
[4] Attorney and Client 45 E:=> 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k112 k. Conduct of litigation. Most Cited
Cases
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d 485)
In order to prevail on a legal malpractice claim
which arises from prior litigation, the plaintiff has
the burden to satisfy "suit within a suit" requirement by showing that but for the attorney's negligence, he or she would be entitled to judgment, and
show what amount would have been collectible had
he or she recovered the judgment.
[5] Antitrust and Trade Regulation 29T E:= 256
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII{D) Particular Relationships
29Tk254 Professionals
29Tk256 k. Legal professionals; attorney and client. Most Cited Cases
(Formerly 92Hk6 Consumer Protection)
Plaintiffs need not prove the "suit within a
suit" element of legal malpractice claim when suing
an attorney under the Deceptive Trade Practices-Consumer Protection Act (DTPA). V.T.C.A.,
Bus. & C.§ 17.41 et seq.
[6] Marriage 253 E:= 50(4)
253 Marriage
253k50 Weight and Sufficiency of Evidence
253k50(4) k. Admissions and declarations.
Most Cited Cases
Evidence was legally sufficient to support
jury's finding of agreement to be married which
thus supported jury's finding on existence of common law marriage; although relationship began
while both were married to others, couple lived together as husband and wife and represented themselves to others as being married after purported
wife obtained divorce and after purported husband's
wife died, and purported wife testified that they
entered into agreement to be married after his first
wife died. V.T.C.A., Family Code § 1.91(a)(2)
(Repealed).
[7] Marriage 253 E:= 22
253 Marriage
Page2
253k22 k. Marriage by cohabitation and reputation. Most Cited Cases
Valid common law marriage consists of three
elements which must exist at the same time: (1) an
agreement presently to be husband and wife; (2)
living together in Texas as husband and wife; and
(3) representing to others in Texas that they are
married. V.T.C.A., Family Code § 1.91(a)(2)
(Repealed).
[8] Marriage 253 E:= 11
253 Marriage
253k4 Persons Who May Marry
253kll k. Prior existing marriage. Most
Cited Cases
If an impediment to the creation of a lawful
marriage between the parties exists, as when one
party is married to someone else, there can be no
common law marriage, even if all three statutory
elements are proven, but an ongoing agreement to
be married may be shown by the circumstantial
evidence of the parties continuing to live together
as husband and wife and holding themselves out to
others as being married after the removal of the impediment. V.T.C.A., Family Code § 2.22
(Repealed).
[9] Marriage 253 E:= 50(5)
253 Marriage
253k50 Weight and Sufficiency of Evidence
253k50(5) k. Cohabitation and reputation.
Most Cited Cases
Evidence was factually sufficient to support
jury's findings that parties held themselves out as
married in state, that parties cohabited, and that
parties' had agreement to be married, which thus
supported jury's finding on existence of common
law marriage; purported husband signed parties in
at hotels in state as husband and wife, gave purported wife wedding ring which she wore, introduced
her as his wife to customers, co-signed promissory
note with her, and stayed at her house frequently,
and purported wife testified that they entered agreement to be married after his first wife died.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S. W .2d 485)
V.T.C.A., Family Code § 1.91(a)(2) (Repealed).
[10] Marriage 253 €=> 22
253 Marriage
253k22 k. Marriage by cohabitation and reputation. Most Cited Cases
Common law marriage requirement of holding
out as married in state can be established by word
or conduct. V.T.C.A., Family Code § 1.91(a)(2)
(Repealed).
[11] Appeal and Error 30 €=> 971(2)
30 Appeal and Error
30XVI Review
30XVI(H) Discretion of Lower Court
30k971 Examination ofWitnesses
30k971(2) k. Competency ofwitness.
Most Cited Cases
Evidence 157 €=> 546
157 Evidence
157XII Opinion Evidence
157XII(C) Competency of Experts
157k546 k. Determination of question of
competency. Most Cited Cases
Whether a witness qualifies as an expert is left
to the discretion of the trial court, and its decision
will not be overturned absent a clear abuse of discretion.
[12] Evidence 157 €=> 538
157 Evidence
157XII Opinion Evidence
157XII(C) Competency of Experts
157k538 k. Due care and proper conduct
in general. Most Cited Cases
Lawyers who practiced in another city in state
were qualified to give expert opinions in legal malpractice case on standard of care applicable to attorneys in county in which client's underlying action
was tried, based on their testimony to having experience that allowed them to become familiar with
standard of care by which a practitioner in county
Page3
should be judged.
[13] Attorney and Client 45 €=> 107
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k1 07 k. Skill and care required. Most Cited
Cases
Attorney in a legal malpractice action is held to
the standard of care that would be exercised by a
reasonably prudent attorney.
[14] Attorney and Client 45 €=> 129(3)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(3) k. Trial and judgment. Most
Cited Cases
Negligence instruction given in legal malpractice standard sufficiently defmed "negligence" and
"ordinary care" in terms of degree of care and actions that attorney of ordinary prudence would have
taken under similar circumstances in county.
[15] Evidence 157 €=> 571(3)
157 Evidence
157XII Opinion Evidence
157XII(F) Effect of Opinion Evidence
157k569 Testimony ofExperts
157k571 Nature of Subject
157k571(3) k. Due care and proper
conduct. Most Cited Cases
Evidence was legally and factually sufficient to
support fmding that attorney was negligent in his
representation of client in her action for common
law marriage and divorce concerning his advice
that client accept proposed settlement; expert testimony indicated that attorney was negligent in advising client to accept settlement offer without investigating full extent of assets owned by couple, in
failing to require purported husband to file sworn
inventory, and in failing to get equitable portion of
marital estate for client.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d 485)
[16] Antitrust and Trade Regulation 29T €=
256
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII(D) Particular Relationships
29Tk254 Professionals
29Tk256 k. Legal professionals; attorney and client. Most Cited Cases
(Formerly 92Hk6 Consumer Protection)
Lawyer's unconscionable conduct is actionable
under the Deceptive Trade Practices-Consumer
Protection Act {DTPA). V.T.C.A., Bus. & C. §
17.45(5) (1994).
[17] Antitrust and Trade Regulation 29T €=
136
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII{A) In General
29Tkl33 Nature and Elements
29Tk136 k. Fraud; deceit; knowledge
and intent. Most Cited Cases
(Formerly 92Hk34 Consumer Protection)
Showing under the Deceptive Trade PracticesConsumer Protection Act {DTP A), that the defendant took advantage of a consumer's lack of knowledge to a grossly unfair degree, does not depend on
the defendant's intent but rather requires a showing
that the resulting unfairness was glaringly noticeable, flagrant, complete, and unmitigated.
V.T.C.A., Bus. & C. § 17.45(5) (1994).
[18] Attorney and Client 45 €= 147
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
45k147 k. Requisites and validity of contract. Most Cited Cases
Contingent attorney fee contract in action for
establishment of common law marriage and divorce
was valid and enforceable.
[19] Attorney and Client 45 €= 147
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
Page4
45k147 k. Requisites and validity of contract. Most Cited Cases
Contingent attorney fees contract for one-third
of recovery is not excessive.
[20] Antitrust and Trade Regulation 29T €=
256
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII{D) Particular Relationships
29Tk254 Professionals
29Tk256 k. Legal professionals; attorney and client. Most Cited Cases
(Formerly 92Hk6 Consumer Protection)
Payment of $90,000 under contingent attorney
fee contract for one-third of recovery in action for
establishment of common law marriage and divorce
did not result in glaring and flagrant disparity
between fee paid by client and the value of services
received and did not support liability under Deceptive Trade Practices-Consumer Protection Act
{DTPA) on unconscionable fee theory. V.T.C.A.,
Bus. & C. § 17.45(5)(B) (1994).
[21] Antitrust and Trade Regulation 29T €=
365
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII(E) Enforcement and Remedies
29TIII(E)5 Actions
29Tk365 k. Verdict, findings, and
judgment. Most Cited Cases
(Formerly 92Hk39 Consumer Protection)
No evidence indicated that conduct of attorney
amounted to anything more than negligence, which
thus precluded jury's finding of unconscionability
on part of attorney and warranted grant of judgment
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d485)
notwithstanding the verdict (JNOV) on client's
claim under Deceptive Trade Practices-Consumer
Protection Act (DTPA). V.T.C.A., Bus. & C. §
17.45(5)(A) (1994).
[22] Appeal and Error 30 ~ 901
30 Appeal and Error
30XVI Review
30XVI(G) Presumptions
30k90 1 k. Burden of showing error. Most
Cited Cases
Appeal and Error 30 ~ 1079
30 Appeal and Error
30XVI Review
30XVI(K) Error Waived in Appellate Court
30kl079 k. Insufficient discussion of objections. Most Cited Cases
Trial court's judgment granting motion for
judgment notwithstanding the verdict (JNOV) did
not specify on which of several asserted grounds it
was granted, which thus obligated appellant to establish on appeal that judgment could not be supported on any of the grounds set out in motion or
waive any ground not challenged.
[23] Judgment 228 ~ 199(5)
228 Judgment
228VI On Trial of Issues
228VI(A) Rendition, Form, and Requisites in
General
228kl99 Notwithstanding Verdict
228kl99(5) k. Motion for judgment in
general. Most Cited Cases
Objection to a jury charge based on legal insufficiency of the evidence is not a prerequisite for a
postverdict motion for judgment notwithstanding
the verdict (JNOV). Vernon's Ann.Texas Rules
Civ.Proc., Rule 279.
[24] Judgment 228 ~ 199(5)
228 Judgment
228VI On Trial of Issues
PageS
228VI(A) Rendition, Form, and Requisites in
General
228kl99 Notwithstanding Verdict
228kl99(5) k. Motion for judgment in
general. Most Cited Cases
Fact that attorney did not object to jury charge
in legal malpractice action on ground that it called
for immaterial jury finding on question of law did
not result in waiver of his right to assert motion for
judgment notwithstanding the verdict (JNOV) on
that ground.
[25] Antitrust and Trade Regulation 29T ~
363
29T Antitrust and Trade Regulation
29TIII Statutory Unfair Trade Practices and
Consumer Protection
29TIII(E) Enforcement and Remedies
29TIII(E)5 Actions
29Tk361 Proceedings; Trial
29Tk363 k. Questions of law or
fact. Most Cited Cases
(Formerly 92Hk40 Consumer Protection)
Attorney and Client 45 ~ 129(3)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl29 Actions for Negligence or Wrongful
Acts
45kl29(3) k. Trial and judgment. Most
Cited Cases
Amount of damages sustained by client presented fact issue for jury in legal malpractice and Deceptive Trade Practices-Consumer Protection Act
(DTPA) action against attorney. V.T.C.A., Bus. &
C.§ 17.41 etseq.
[26] Appeal and Error 30 ~ 215(1)
30 Appeal and Error
30V Presentation and Reservation in Lower
Court of Grounds of Review
30V(B) Objections and Motions, and Rulings
Thereon
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
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30k214 Instructions
30k215 Objections in General
30k215(1) k. Necessity of objection
in general. Most Cited Cases
Intermingling of matters for the jury with matters for the court alone in a jury charge is an error
that is waived by failure to object to the charge.
Vernon's Ann.Texas Rules Civ.Proc., Rule 274.
[27] Attorney and Client 45 C=> 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kll2 k. Conduct of litigation. Most Cited
Cases
Attorney and Client 45 C=> 129(3)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl29 Actions for Negligence or Wrongful
Acts
45kl29(3) k. Trial and judgment. Most
Cited Cases
In a legal malpractice suit based on negligence,
the plaintiff is required to establish that any judgment that would have been obtained in the underlying action, but for the attorney's breach of duty,
would have been collectible, and thus question of
collectibility must either be included in damages
question itself or it must be included in a separate
jury instruction.
[28] Attorney and Client 45 C=> 129(3)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl29 Actions for Negligence or Wrongful
Acts
45kl29(3) k. Trial and judgment. Most
Cited Cases
Client had burden of requesting jury question
on the proper measure of damages in legal malpractice action.
[29] Appeal and Error 30 C=> 1177(5)
Page6
30 Appeal and Error
30XVII Determination and Disposition of Cause
30XVII(D) Reversal
30kll77 Necessity ofNew Trial
30kll77(5) k. Errors in rulings and instructions at trial. Most Cited Cases
Damages 115 C=> 221(5.1)
115 Damages
115X Proceedings for Assessment
115k219 Verdict and Findings
115k221 Special Interrogatories and Findings by Jury
115k221(5) Preparation and Form of
Interrogatories or Findings
115k221(5.1) k. In general. Most
Cited Cases
Question that fails to guide the jury on any
proper legal measure of damages is fatally defective
and requires remand for a new trial.
[30] Appeal and Error 30 C=> 1064.1(7)
30 Appeal and Error
30XVI Review
30XVI(J) Harmless Error
30XVI( J) 18 Instructions
30kl064 Prejudicial Effect
30kl064.1 In General
30kl064.1(2) Particular Cases
30kl064.1(7) k. Damages
and amount of recovery. Most Cited Cases
Submission of erroneous jury question on damages in legal malpractice action, which failed to
limit jury's consideration to amount client could
have collected in settlement of underlying action,
required remand for new trial on negligence claim
under circumstances that damages were unliquidated and liability issues were contested. Rules
App.Proc., Rule 44.l(b).
*488 Marvin B. Zimmerman, Zimmerman & Zimmerman, P.C., San Antonio, Oscar C. Ganzales,
Oscar C. Gonzales, Inc., San Antonio, John M.
Pinckney, III, Wells, Pinckney & McHugh, P.C.,
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d 485)
San Antonio, Judith R. Blakeway, Strasburber &
Price, L.L.P., San Antonio, for Appellant.
Timothy Patton, Pozza & Patton, San Antonio,
Harlin C.Womble, Jr., Jordan & Shaw, P.C., Corpus Christi, for Appellees.
Before PHIL HARDBERGER, Chief Justice, TOM
RICKHOFF, Justice, ALMA L. LOPEZ, Justice,
CATHERINE STONE, Justice, PAUL W. GREEN,
Justice, SARAH B. DUNCAN, Justice, KAREN
ANGELINI, Justice, en bane.
OPINION ON APPELLEE'S MOTION FOR
REHEARING EN BANC
KAREN ANGELINI, Justice.
Appellee's motion for rehearing en bane is
granted and the motion to resubmit is denied. Our
opinion of September 29, 1993 and judgment of July 28, 1993 are withdrawn, and the following opinion and judgment are substituted.
Nature of the case
This is an appeal of a judgment notwithstanding the verdict in a legal malpractice and deceptive
trade practices suit. Appellant, *489 Sandra Ballesteros, filed suit against appellees, James K. Jones
and the Law Offices of Mann and Jones
(collectively referred to as "Jones"), asserting that
the settlement Jones had obtained on her behalf in a
suit to establish a common law marriage and for divorce against Andres Monetou was inadequate and
that Jones had charged her an excessive fee. The
jury found that a common law marriage had existed
between Ballesteros and Monetou, and found that
Jones was negligent and had acted unconscionably.
The trial court granted Jones's motion for judgment
notwithstanding the verdict. Ballesteros filed this
appeal.
[1][2][3] To sustain the trial court's action in
entering a judgment notwithstanding the verdict,
the reviewing court must determine that there is no
evidence to support the jury's findings. Best v. Ryan
Auto Group, Inc., 786 S.W.2d 670, 671 (Tex.l990);
Page7
Navarette v. Temple Indep. Sch. Dist., 706 S.W.2d
308, 309 (Tex.1986). "In making this determination, we view the evidence in the light most favorable to the jury's findings, considering only the
evidence and inferences which support them, and
rejecting the evidence and inferences contrary to
those fmdings." Navarette, 706 S.W.2d at 309. It is
error to grant a judgment notwithstanding the verdict when there is more than a scintilla of evidence
to support the jury's finding. Mancorp, Inc. v.
Culpepper, 802 S.W.2d 226, 228 (Tex.1990).
[ 4] In order to prevail on a legal malpractice
claim which arises from prior litigation, the
plaintiff has the burden to show that "but for" the
attorney's negligence, he or she would be entitled to
judgment, and show what amount would have been
collectible had he or she recovered the judgment.
Cosgrove v. Grimes, 774 S.W.2d 662, 666
(Tex.1989); Hall v. Rutheiford, 911 S.W.2d 422,
424 (Tex.App.-San Antonio 1995, writ denied);
Jackson v. Urban, Coolidge, Pennington & Scott,
516 S.W.2d 948, 949 (Tex.Civ.App.-Houston [1st
Dist.] 1974, writ ref'd n.r.e.). This is commonly referred to as the "suit within a suit" requirement.
[5] Because the plaintiff must establish that the
underlying suit would have been won "but for" the
attorney's breach of duty, this "suit within a suit"
requirement is necessarily a component of the
plaintiff's burden on cause in fact. However, the
plaintiff only has the burden to prove a "suit within
a suit" in a negligence claim. Plaintiffs need not
prove the "suit within a suit" element when suing
an attorney under the DTP A. Latham v. Castillo,
972 S.W.2d 66, 69 (Tex.1998).
Because Ballesteros alleged that Jones was
negligent, the trial court correctly applied the "suit
within a suit" concept when the first jury question
asked if a common law marriage existed between
Ballesteros and Monetou.
Common Law Marriage
[6] In her first point of error, Ballesteros argues
that the trial court erred in granting Jones's motion
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d 485)
for judgment notwithstanding the verdict because
the evidence was legally sufficient to support the
jury's finding of a common law marriage. We
agree.
[7] A valid common law marriage consists of
three elements: (1) an agreement presently to be
husband and wife; (2) living together in Texas as
husband and wife; and (3) representing to others in
Texas that they are married. Russell v. Russell, 865
S.W.2d 929, 932 (Tex.1993); TEXBftAM.CODE
ANN. § 1.9l(a)(2) (Vernon 1993). All three
elements must exist at the same time. Bolash v.
Heid, 733 S.W.2d 698, 699 (Tex.App.-San Antonio 1987, no writ).
FNI. Act of June 2, 1969, 6lst Leg., RS.,
ch. 888, § 1.91, 1969 Tex. Gen. Laws
2707, 2717 (repealed 1997) (current version at TEX. FAM.CODE ANN. § 2.401
(a)(2) (Vernon Pamph.l998)). Section 1.19
was repealed and reenacted as section
2.401(a)(2) without substantive change.
Viewing the evidence as we are required to do
under the applicable standard of review, the facts
pertaining to the alleged common law marriage are
as follows. Monetou and Ballesteros began living
together in 1970. Both were married to other persons at the time. Their relationship lasted 17 years.
Shortly after the relationship began, Ballesteros and
her husband divorced. In 1975, Ballesteros gave
birth to a son fathered by Monetou. They named
their son Andres, Jr. *490 Monetou's wife died in
1980. In 1983, Monetou legitimized his son by a
decree of paternity. The decree recited that Monetou and Ballesteros were living together at the
same address in Laredo. During their relationship,
Ballesteros and Monetou traveled together and
would sign hotel and airline documents "Mr. and
Mrs. Monetou." Monetou supported Ballesteros,
Andres, Jr., and Ballesteros's two other sons fmancially. Ballesteros testified that her older son considered Monetou a hero and that her second son
called him "daddy."
Page 8
According to Ballesteros, she and Monetou cohabited three or four times a week in Laredo, although Monetou also spent some time at his Nuevo
Laredo residence with his other children. Monetou
kept clothes at the house in Laredo; he would bathe,
shave, and eat there; and he invited his other children over for visits and meals. Monetou paid for
improvements to the house in Laredo. At times,
Monetou and Ballesteros traveled together, accompanied by Monetou's other children. Monetou gave
Ballesteros a diamond ring and a wedding band
which she continued to wear after Monetou's wife
died. Monetou introduced Ballesteros to others as
his wife. They held themselves out as husband and
wife in Laredo and while traveling. Monetou cosigned promissory notes for Ballesteros, including
one that allowed her to pay off the mortgage on the
house in Laredo that she and Andres, Jr. had shared
with Monetou.
Ballesteros testified that after Monetou's wife
died, she and Monetou began spending more time
together and that he moved his clothes into the
house in Laredo and would stay there. During this
time, according to Ballesteros, they also held themselves out to others as being married to one another.
She testified that at this time they entered into an
agreement to be married. We consider this as some
evidence of the existence of an agreement to be
married. Col/ora v. Navarro, 574 S.W.2d 65, 70
(Tex.l978); Winfield v. Renfro, 821 S.W.2d 640,
645 (Tex.App.-Houston [1st Dist.] 1991, writ
denied); Bolash, 733 S.W.2d at 699. Furthermore,
the agreement to be married may be shown by circumstantial evidence or conduct of the parties. Russell, 865 S.W.2d at 933. Proof of cohabitation and
representing to others that they were married may
constitute circumstantial evidence from which a
jury could fmd an agreement to be married. See id.
[8] Jones argues that Monetou and Ballesteros
could not be engaged in a common law marriage
because the relationship was illicit in its origin. If
an impediment to the creation of a lawful marriage
between the parties exists, as when one is married
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d 485)
to another, there can be no common law marriage,
even if all three elements are proven. Howard v.
Howard, 459 S.W.2d 901, 904
(Tex.Civ.App.-Houston [1st Dist.] 1970, no writ).
However, an ongoing agreement to be married may
be shown by the circumstantial evidence of the
parties continuing to live together as husband and
wife and holding themselves out to others as being
married after the removal of the impediment. TEX.
FAM.CODE ANN. § 2.22 (Vernon 1993) FN2
;
Garduno v. Garduno, 760 S.W.2d 735, 741
(Tex.App.-Corpus Christi 1988, no writ). There is
evidence that the parties lived together as husband
and wife and represented themselves to others as
being married after Monetou's wife died. As we
have indicated, Ballesteros testified that at the time
of the death of Monetou's wife they entered into an
agreement to be married. This is some evidence of
the required agreement.
FN2. Act of June 2, 1969, 61st Leg., R.S.,
ch. 888, § 2.22, 1969 Tex. Gen. Laws
2707, 2719 (repealed 1997) (current version at TEX. FAM.CODE ANN. § 6.202
(Vernon Pamph.1998)). Section 2.22 was
repealed and reenacted as section 6.202
without substantive change.
Looking at the evidence in the light most favorable to the jury's findings, we find some evidence to
support the jury's finding that Ballesteros and Monetou were engaged in a common law marriage.
Thus, the evidence is legally sufficient and the motion for judgment notwithstanding the verdict was
improper on this issue. We sustain the first point of
error.
Jones argues in his first two cross-points that
the evidence is factually insufficient to support the
jury's common law marriage finding. In considering
a factual insufficiency challenge, we must consider
and weigh all the evidence and reverse for a new
trial only *491 if the challenged finding is so
against the overwhelming weight of the evidence as
to be clearly wrong and unjust. Cain v. Bain, 709
S.W.2d 175, 176 (Tex.1986). We may not substiPage9
tute our opinion for that of the jury merely because
we would have reached a different result. Pool v.
Ford Motor Co., 715 S.W.2d 629, 634 (Tex.1986).
[9][10] Jones first contends that the evidence is
factually insufficient on the requirement of holding
out. The common law marriage requirement of
holding out can be established by word or conduct.
Estate of Giesse/, 734 S.W.2d 27, 31
(Tex.App.-Houston [1st Dist.] 1987, writ refd
n.r.e.). Proof of holding out requires that it be done
in Texas. TEXpJJAM.CODE ANN. § 1.91(a)(2)
(Vernon 1993). Jones argues that the vast majority of the trips where Monetou and Ballesteros
registered at hotels and with airlines as a married
couple were in other states and in Mexico. Monetou
denied that he represented to anyone else that he
and Ballesteros were husband and wife. He testified
that most of the reservations were in the name of
"Mr. and Mrs. Monetou" because Ballesteros made
them. The promissory notes that Monetou cosigned were signed after the relationship ended and
were in Ballesteros's name. The couple never filed
income tax returns as husband and wife.
FN3. Act of June 2, 1969, 61st Leg., R.S.,
ch. 888, § 1.91, 1969 Tex. Gen. Laws
2707, 2717 (repealed 1997) (current version at TEX. FAM.CODE ANN. § 2.401
(a)(2) (Vernon Pamph.1998)). Section 1.19
was repealed and reenacted as section
2.401(a)(2) without substantive change.
Monetou did acknowledge, however, that numerous trips he and Ballesteros took were within
the State of Texas and many of these trips occurred
after the death of his wife. Monetou testified he had
signed in at hotels as "Mr. and Mrs. Monetou." He
also admitted giving Ballesteros a diamond ring and
a wedding band, which she wore after his wife's
death. Bruce Adams, a business associate of Monetou, testified that after Monetou's wife died, Monetou introduced Ballesteros as his wife not only to
him but also to customers in Adams's warehouse in
Laredo. Adams testified that on business trips he
took with Monetou and Ballesteros, Monetou would
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introduce Ballesteros as his wife. Monetou testified
that he co-signed one of the promissory notes to allow Ballesteros to pay off the mortgage on her
house in Laredo so she and his son could keep the
house.
Jones next contends that the proof of cohabitation is factually insufficient. The evidence showed
that Monetou is a Mexican national whose permanent residence is in Nuevo Laredo. Although he visited Ballesteros frequently at her Laredo home and
spent as much as a week at a time with her there, he
testified that he never intended to live with Ballesteros permanently in Laredo. He also testified that
he saw other women during the time of his relationship with Ballesteros and thought she knew about
this.
We find the evidence ofMonetou's and Ballesteros's living and family arrangements in Laredo
sufficient to establish the cohabitation element of a
common law marriage. Monetou's business associate, Adams, testified that he went to their house in
Laredo on numerous occasions in the evenings and
saw Monetou there. He further testified that Monetou gave him the phone number of the Laredo
house so that he could call Monetou there at night.
In fact, Adams reached Monetou there by phone in
the evenings. The evidence shows that Monetou
stayed at the house in Laredo on a regular basis. Although he did frequently return to his house in
Nuevo Laredo where the children of his first marriage lived, this in itself is not sufficient to destroy
the pattern of living together. See Bolash, 733
S.W.2d at 699 (fmding evidence that the man, employed in Nigeria, stayed at the woman's residence
during his periodic visits to Texas was sufficient to
support the finding that they lived together as husband and wife "to the extent possible under the circumstances"). The decree legitimizing Andres, Jr.
lists both parties as living at the same address in
Laredo. Considering all the evidence as a whole,
there is evidence of more than merely isolated instances of living together. Thus, we view the evidence as sufficient to establish holding out and coPage 10
habitation.
Finally, Jones challenges the sufficiency of the
evidence to support the agreement element*492 of
a common law marriage. He refers to testimony by
Monetou that he never intended to marry Ballesteros, that he told her he would not marry her, and that
he made a conscious decision not to marry her
when he acknowledged paternity of his child. Jones
also points out that Monetou was to be ceremonially married to another woman on the day that he
was served with Ballesteros's suit. Jones contends
that this evidence indicated that Monetou never
considered himself to be married to Ballesteros. Finally, there was testimony that Monetou hired prostitutes, sometimes flying them in from as far away
as Mexico City, to engage in lesbian sex with
Ballesteros while he watched. Although Ballesteros
testified that she was not a willing participant in
these activities, she also testified that the relationship ended when she would no longer satisfy Monetou's desires. Jones argues that this conduct is inconsistent with a man intending to transform an
"illicit affair" into a marriage.
We have already detailed Ballesteros's evidence regarding the agreement element of a common
law marriage. The jury believed Ballesteros. The
jury is the sole judge of the credibility of the witnesses and the weight to be given their testimony.
Jaffe Aircraft Corp. v. Carr, 867 S.W.2d 27, 28
(Tex.1993). It may resolve conflicts or inconsistencies in the testimony. Barrajas v. VIA Metro.
Transit Auth., 945 S.W.2d 207, 209
(Tex.App.-San Antonio 1997, no writ). We cannot
say the jury's finding of a common law marriage is
so against the overwhelming weight of the evidence
as to be clearly wrong and unjust. We find that the
evidence was factually sufficient. Therefore, we
overrule Jones's first and second cross-points.
Legal Malpractice and DTP A
In the remainder of her points, Ballesteros argues that the evidence was legally sufficient to support the jury verdict in her favor on legal malpractice, violation of the DTPA, and damages. Jones
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brings a number of cross-points, contending that if
we reverse the judgment notwithstanding the verdict, we should remand for a new trial because the
charge was defective and because the evidence was
factually insufficient to support the jury's legal malpractice and DTP A fmdings.
A review of the evidence in the light most favorable to the jury's findings shows that in the summer of 1988, Ballesteros consulted with attorney
Shirley Hale because she wanted to file for divorce.
Ms. Hale advised Ballesteros to request a monthly
allowance until divorce papers were filed. At that
point, Monetou and Ballesteros agreed she would
not file for divorce and he would provide her with
$1500 a month allowance. Shortly thereafter,
Ballesteros became aware that Monetou was getting
married. She then contacted Jones about getting a
divorce. She had, on a previous occasion, talked to
Jones about her common law marriage, and he told
her if she ever decided to leave Monetou, she could
get a divorce. Jones requested a $10,000 retainer,
but Ballesteros told him she did not have the
money. Instead, Ballesteros gave Jones $3,000 and
she signed an agreement with Jones that stated: "for
and in consideration of the services which the firm
shall provide, it shall receive one-third ( 1/3 ) of
any money or property awarded to me."
Ballesteros spoke with Jones for about six
hours about the case on January 12, 1989. Before
the hearing, Ballesteros told Jones about having sex
with other women in order to please Monetou. According to Ballesteros, Jones said that they could
use the information about Monetou's sexual appetites to "hang him." He told Ballesteros he had
handled another divorce case in Laredo that was
probably worse than hers. After discussions in the
judge's chambers before the hearing, Jones related
to Ballesteros that Monetou had offered to settle for
$100,000. Jones said that the offer was not good
enough and recommended that she settle for
$300,000. At that time, Ballesteros had no idea of
Monetou's net worth.
Within a few days the parties reached a settlePage 11
ment. According to Ballesteros, Jones told her it
was a wonderful agreement and that she was rich
woman. He told her it would be better for her to
settle because a jury would fmd against a common
law marriage based on the sexual encounters with
other women. Jones testified that he believed *493 a
jury would not believe that a man would treat his
wife that way. Based on these representations by
Jones, Ballesteros approved the settlement agreement, relinquishing her claims to a marriage with
Monetou and, therefore, her claims to any community property.
The settlement agreement, dated March 8,
1989, provided that Ballesteros would receive
$90,000 in cash; Monetou would pay three promissory notes dated June and August 1988 in the principal amounts of $10,000, $65,000, and $69,573.55.
The three notes represented debts on Ballesteros's
house and business. Additionally, he would relinquish all interest in International Van Storage, the
business operated by Ballesteros, and two lots in
Laredo. Monetou would pay Ballesteros $1400 per
month for life, secured by a lien on a warehouse in
Laredo. In return, Ballesteros agreed to dismiss the
divorce suit with prejudice. A certified public accountant valued the settlement at $384,839.
When Ballesteros originally told Jones about
the sexual encounters, she was willing and unafraid
to go to court. According to Ballesteros, she would
not have signed the settlement agreement had she
known the extent of Monetou's assets. At the time
the parties signed the settlement agreement, there
was no discussion about Jones's fee. Later, when
the checks came in, Jones told her he would take
his fee out of the cash, which she understood would
be one-third of the $90,000. Jones gave her a check
for the first $1400 monthly payment and asked her
to endorse the $90,000 check over to him. Jones
said he would give her the balance as soon as expenses were cleared. When she left Jones's office,
Ballesteros was under the belief she would receive
$60,000 from Jones.
Approximately one week later, Jones's recep-
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tionist contacted Ballesteros and told her they had a
check for her. When Ballesteros went to Jones's office, she was given a check for $88.45 and an invoice. The invoice reflected that the amount was
the balance from the $3,000 deposit she had given
Jones. Ballesteros stated she was in shock after
realizing she received $88.45 out of a $90,000 cash
settlement. She wrote Jones asking him to reconsider his fee because of her desperate financial situation and indicated that time was of the essence.
Ballesteros was then arrested for writing hot
checks. After Ballesteros was released, she went to
see Jones and he told her that the $90,000 was actually a reduced fee. He explained that under the contract, he was entitled to take one-third of the money
and property she had received, which would be
much more than $90,000. He told her they could go
back to the original agreement but it would end up
costing her more.
At the time she signed the settlement agreement, Ballesteros was unaware of what property she
might be entitled to. Although the temporary injunction provided for an inventory, Jones never obtained one. Jones also never took Monetou's deposition nor did he hire an investigator to do an asset
search. Jones also never made a settlement demand.
Jones did check the county tax assessor's office and
determined that Monetou had no property in his
name in Webb County. Jones said he did not think
the first offer of settlement was worth taking, not
because of any knowledge of Monetou's assets, but
because he generally does not feel the first offer is
worth taking in any litigation. In fact, Monetou did
have extensive real property and business holdings
in Texas and Mexico. At the time of the settlement,
he had a $900,000 certificate of deposit and
$15,000 to $20,000 in his checking account in a
Laredo bank. Monetou estimated his net worth at
that time was approximately $2,000,000.
Ballesteros sued Jones under the DTPA alleging that his conduct in coercing her to settle her
cause of action without determining the size of the
estate acquired by the parties during their common
Page 12
law marriage resulted in a gross disparity between
the value received and what she should have received. She sued him for negligence and gross negligence in failing to investigate properly and determine the full extent of the assets owned by the
community; failing to require Monetou to file an inventory; failing to perform routine discovery; failing to discover marital assets prior to settlement;
failing to obtain a settlement which would award
her an equitable portion of the community property;
failing to protect her rights by *494 dismissing her
case and by agreeing to entry of an order that declared no marriage existed; and charging her an unconscionable attorney's fee.
In addition to finding that a common law marriage existed, the jury found that Jones knowingly
engaged in unconscionable conduct that was a producing cause of Ballesteros's damages, that he was
negligent and that his negligence was a proximate
cause of her damages, and that he was grossly negligent. The jury awarded Ballesteros $560,000 in
actual damages. She was awarded $60,000 for mental anguish, $100,000 in additional damages under
the DTPA, and $200,000 as exemplary damages.
She was also awarded attorney's fees of $100,000
through trial, $15,000 for appeals, $10,000 for making or responding to a writ of error to the supreme
court, and $5,000 if the writ were granted.
Negligence
In her fourth point of error, Ballesteros alleges
that the court erred in granting a judgment notwithstanding the verdict because the evidence was legally sufficient to support the jury's finding of legal
malpractice. In Jones's fourth cross-point, he contends that the evidence was factually insufficient to
support the jury's fmdings of liability.
A legal malpractice action is based on negligence. Cosgrove, 774 S.W.2d at 664. To prove that
Jones breached the standard of care and thus was
negligent, Ballesteros called two family law practitioners, Christine Tharp and Frank Pennypacker, as
expert witnesses. Because both Tharp and
Pennypacker are San Antonio lawyers, Jones in his
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fourth reply point, objects to their qualifications to
express opinions concerning the standard of care
applicable to an attorney practicing in Webb
County. In Cook v. Irion, 409 S.W.2d 475, 478
(Tex.Civ.App.-San Antonio 1966, no writ), this
court noted that an attorney practicing in a vastly
different locality would not be qualified to second
guess the judgment of an experienced attorney as to
who should be joined as additional party defendants. In that malpractice action against an El Paso
attorney, an attorney from Alpine was called as an
expert witness. The opinion noted that Alpine was
220 miles from El Paso and that the population of
Brewster County was 6,434, as compared to
314,070 in El Paso County. /d. The Alpine attorney
had never tried a case in El Paso County. /d. at 477.
Therefore, rather than testifying as to the care, skill,
and diligence customarily exercised by El Paso
County attorneys, he testified, over objection, concerning the requisite standard of care of the average
general practitioner in Texas. /d. Jones points out
that neither Tharp nor Pennypacker had ever tried a
case, picked a jury, appeared before a judge, or participated in a contested evidentiary matter in Webb
County. The attorneys testified that they were familiar with the standard of care required of a Webb
County practitioner because they had worked on
cases out of Webb County, they had consulted with
Webb County attorneys and San Antonio attorneys
who practice extensively in Webb County, they had
consulted Webb County court personnel about local
customs, and they had practiced before judges who
try cases in Webb County. Tharp testified that she
had tried cases before the trial judge in this case.
[II] A party offering expert testimony has the
burden to show that the witness is qualified, that is,
that the witness possesses a higher degree of knowledge or skill than an ordinary person and that the
knowledge or skill will assist the trier of fact.
TEX.R. CIV. EVID. 702. Whether a witness qualifies as an expert is left to the discretion of the trial
court, and its decision will not be overturned absent
a clear abuse of discretion. Broders v. Heise, 924
S.W.2d 148, 151 (Tex.1996).
Page 13
[12] The charge in this case limited its defmitions of negligence, ordinary care, and proximate
cause to Webb County. Thus, the question is whether Ballesteros's experts were competent to address
the standard of care existing in the Webb County
legal community. Despite the fact that neither
Tharp nor Pennypacker were Webb County practitioners, the trial court acted well within its discretion in allowing these two attorneys to testify as experts. They testified to having experience that allowed them to become familiar with the standard of
care by which a Webb County practitioner should
be judged. *495 Thus, Ballesteros met the threshold
burden of showing that her experts possessed greater knowledge, skill, experience, and training than
the jury, and that they were familiar with the standard of care that should exist in the Webb County
legal community. At that point, the weight and
credibility of the testimony was for the jury to determine. ITT Commercial Fin. Corp. v. Riehn, 796
S.W.2d 248, 250 (Tex.App.-Dallas 1990, no writ).
[13][14] An attorney in Texas is held to the
standard of care that would be exercised by a reasonably prudent attorney. Cosgrove, 774 S.W.2d at
664. The standard is an objective exercise of professional judgment. /d. at 665. Jones complains in
his third cross-point that the negligence instruction
was fundamentally defective because it failed to set
out the Cosgrove standard of liability. He requested
the following instruction:
If an attorney makes a decision which a reasonably prudent attorney could make in the same or
similar circumstances, it is not an act of negligence even if the result is undesirable. An attorney who makes a reasonable decision in the
handling of a case is not negligent simply because the decision later proves to be imperfect.
This language tracks language from Cosgrove.
See id. The terms "negligence" and "ordinary care"
were defined in the charge as follows:
"Negligence," when used with respect to the conduct of James K. Jones, Jr., d/b/a/ Law Offices of
Mann & Jones, means failure to use ordinary
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care, that is, failing to do that which an attorney
of ordinary prudence would have done under the
same or similar circumstances in Webb County,
or doing that which an attorney of ordinary
prudence would not have done under the same or
similar circumstances in Webb County.
"Ordinary care," when used with respect to the
conduct of James K. Jones, Jr., d/b/a Law Offices
of Mann & Jones, means the degree of care that
an attorney of ordinary prudence could use under
the same or similar circumstances in Webb
County.
In Cosgrove, the Supreme Court said that the
instruction "should clearly set out the standard for
negligence in terms which encompass the attorney's
reasonableness in choosing one course of action
over another." /d. The instructions in this case set
out the proper standard of liability. In fact, the instruction sets out the standard in greater detail than
the instruction reviewed in Cosgrove. See id. Crosspoint three is overruled.
[15] In addressing Ballesteros's fourth point of
error and Jones's fourth cross-point, we find that
there was expert testimony that Jones was negligent
in failing to investigate properly the full extent of
the assets owned by Monetou and Ballesteros at the
time of the settlement, in failing to require Monetou
to file a sworn inventory, and in failing to get an
equitable portion of the marital estate for Ballesteros. Jones argues that he had no duty to conduct discovery because he counseled Ballesteros concerning whether to forego legally available objectives
or methods. Ballesteros testified, however, that
Jones never told her about an inventory or any other
discovery device. According to Ballesteros's experts, Jones could not have competently advised her
to forego what she was foregoing since he had no
idea of the extent of Monetou's assets. Ballesteros's
experts testified it would have been a simple matter
under Texas discovery rules to obtain information;
he could have obtained an inventory, he could have
taken depositions, he could have hired an investigator. A reasonably prudent attorney could not have
Page 14
advised his client to accept a settlement under these
circumstances. Having reviewed the evidence in the
light most favorable to the jury finding, we fmd
some evidence from which a jury could conclude
that Jones was negligent in his representation of
Ballesteros. Thus, we find the evidence legally sufficient and sustain Ballesteros's fourth point of error. Looking at all the evidence, we also fmd that
the jury's finding of negligence is not so against the
overwhelming weight of the evidence as to be
clearly wrong and unjust. Thus, the evidence is factually sufficient to support the jury's finding of negligence.
Unconscionability
In her second point of error, Ballesteros argues
that the court erred in granting a *496 judgment
notwithstanding the verdict because there was legally sufficient evidence to support the jury's fmding
that Jones acted unconscionably, and did so knowingly. In Jones's fourth cross-point, he contends that
the evidence was factually insufficient to support
the jury's findings of liability.
[ 16][ 1 7] The jury found that Jones engaged in
an unconscionable action or course of action that
was a producing cause of damages to Ballesteros.
Unconscionable action or course of action means an
act or practice which, to a person's detriment:
(A) takes advantage of the lack of knowledge,
ability, experience, or capacity of a person to a
grossly unfair degree; or
(B) results in a gross disparity between the value
received and consideration paid, in a transaction
involving transfer of consideration.
TEX. BUS. & COM.CODE ANN. § 17.45(5)
(Vernon 1987).FN4 A lawyer's unconscionable
conduct is actionable under the DTP A. See Latham,
972 S.W.2d at 68, DeBakey v. Staggs, 612 S.W.2d
924, 925 (Tex.1981). A showing under subparagraph A of section 17.45(5), that the defendant took
advantage of a consumer's lack of knowledge to a
grossly unfair degree, does not depend on the de-
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fendant's intent. It requires a showing that the resulting unfairness was "glaringly noticeable, flagrant, complete, and unmitigated." Chastain v.
Koonce, 700 S.W.2d 579, 584 (Tex.l985).
FN4. See Act of May 10, 1977, 65th Leg.,
R.S., ch. 216, § 1, 1977 Tex. Gen. Laws
600 (amended 1995) (current version at
TEX. BUS. & COM.CODE ANN. § 17.45
(5) (Vernon Supp.l998)).
In the recent case of Latham v. Castillo, the
Texas Supreme Court discussed unconscionable
conduct under the DTP A in a legal malpractice
case. In Latham, the plaintiffs retained an attorney
to file a medical malpractice claim against a hospital for causing the death of their young daughter.
Latham, 972 S.W.2d at 67. The plaintiffs sued the
attorney for negligence because he failed to file the
lawsuit within the statute of limitations. Id. The
plaintiffs also alleged unconscionable action under
the DTP A because the attorney affirmatively represented to them that he had filed the lawsuit. Additionally, the plaintiffs alleged fraudulent misrepresentation and breach of contract. After the plaintiffs
presented their case, the judge granted a directed
verdict that the plaintiffs take nothing from the attorney. Id. Presumably, the judge granted the directed verdict because the plaintiffs offered no evidence that "but for" the attorney's negligence the
medical malpractice suit would have been successful and damages would have been recoverable and
collectible. The court of appeals affirmed the directed verdict on negligence and the plaintiffs did not
appeal that issue. The court of appeals remanded
the remaining issues. The supreme court found that
the plaintiffs had offered some evidence on all elements of their DTP A cause of action. !d. at 70.
As in our case, the plaintiffs in Latham argued
that the lawyer's conduct was an "unconscionable
action or course of action." The supreme court
stated that the legislature enacted the DTP A to protect consumers against false, misleading, and deceptive business practices and unconscionable actions. "Attorneys can be found to have engaged in
Page 15
unconscionable conduct by the way they represent
their clients." Id. at 68. In Latham, the plaintiffs depended on the attorney to file their suit and the record reveals that the attorney told the plaintiffs he
had filed the claim when actually he had not. The
court stated that the attorney took advantage of the
trust his clients placed in him as an attorney and
found some evidence that the clients were taken advantage of to a grossly unfair degree. Id. at 69. The
attorney argued that the plaintiffs' DTP A claim was
essentially a dressed-up legal malpractice claim and
the plaintiffs should have proven that they would
have won the medical malpractice case in order to
recover. !d. The court disagreed and stated that recasting the plaintiffs' claims as merely a legal malpractice claim would subvert the legislature's clear
purpose of deterring deceptive practices. Id. The
court stated that if the plaintiffs had only alleged
that the attorney negligently failed to file their
claim, the claim would only be one for legal malpractice. "It is the difference between negligent
conduct and deceptive conduct. To recast this claim
as one for legal malpractice is to ignore this *497
distinction." !d. The court concluded that the DTP A
does not require the "suit within a suit" element
when suing an attorney under the DTP A. !d.
Both of Ballesteros's experts testified that
$90,000 for the amount of work performed on the
case was clearly excessive and unconscionable.
Tharp testified that in her opinion Jones had done
only about $3,500 worth of work. Jones's own records show he spent 52 hours on the case, in addition to 65 hours of associate's time. This averages
out to a fee of $769.23 per hour. Tharp, a board certified family law specialist, testified that her hourly
rate is $125. Both experts testified that contingent
fee contracts in divorce actions, while not illegal,
are not recommended and lead to an automatic conflict of interest between the attorney and client.
[18][19][20] We cannot approve of contingent
fee contracts in traditional divorce actions for the
reasons mentioned by Ballesteros's experts. Further,
while not in effect when the present agreement was
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signed, our code of Professional Conduct is also instructive regarding the policy reasons that disfavor
such fee arrangements in certain kinds of family
law litigation.
Contingent and percentage fees in family law
matters may tend to promote divorce and may be
inconsistent with a lawyer's obligation to encourage reconciliation. Such fee arrangements also
may tend to create a conflict of interest between
lawyer and client regarding the appraisal of assets
obtained for client. See also Rule 1.08(h). In certain family law matters, such as child custody and
adoption, no res is created to fund a fee. Because
of the human relationships involved and the
unique character of the proceedings, contingent
fee arrangements in domestic relations cases are
rarely justified.
TEX. DISCIPLINARY R. PROF'L CONDUCT
1.04 cmt. 9, reprinted in TEX. GOV'T CODE
ANN., tit. 2, subtit. G app. A (Vernon Supp.l998)
(TEX. STATE BAR R. art. X, § 9). This case,
however, was not a traditional divorce action since
a recovery by the plaintiff depended on the establishment first of a common law marriage. While
rarely justified in divorce actions, contingent fee
contracts may be appropriate in a situation such as
this. If the marriage is not established, the plaintiff
may recover nothing, a situation differing sharply
from a divorce suit involving a ceremonial marriage
in which each party will obtain a recovery of some
sort. The contingency fee contract between Jones
and Ballesteros is valid and enforceable. Further, a
one-third contingent fee contract is not excessive.
See Kuhn, Collins & Rash v. Reynolds, 614 S.W.2d
854, 857 (Tex.Civ.App.-Texarkana 1981, writ
refd n.r.e.). We therefore cannot say that there is a
glaring and flagrant disparity between the fee paid
by Ballesteros and the value of the services received.
[21] We hold that the evidence is legally and
factually insufficient to support a fmding for
Ballesteros under section 17.45(5)(B). Because we
find that the fee was not unconscionable, we must
Page 16
find evidence, other than the fee agreement, to support the jury's finding under 17.45(5)(A). Therefore, we must find evidence that Jones took advantage of the lack ofknowledge, ability, experience, or
capacity of Ballesteros to a grossly unfair degree.
In her amended petition, Ballesteros alleges
that the unconscionable conduct was the excessive
fee Jones received in relation to the work he performed and the results he obtained. Ballesteros's experts testified that the fee was excessive and unconscionable. The record shows that the focus of
Ballesteros's unconscionability claim was the fee
agreement. In her brief, Ballesteros's unconscionability argument concerns the excessive attorney's fee
issue. There was testimony from Ballesteros's experts, however, that Jones (1) failed to obtain a divorce for Ballesteros; (2) failed to obtain an inventory; and (3) urged a settlement without discovery of
assets. They opined that this conduct constituted
negligence and gross negligence. Thus, apart from
the fee issue, evidence of Jones's negligence would
also have. to support the jury finding on unconscionability.
The Supreme Court in Latham drew a clear distinction between negligent conduct, which gives
rise to recovery for the "suit within a suit" type of
legal malpractice, and deceptive conduct which
gives rise to recovery*498 under the DTP A for unconscionability and does not require the "suit within a suit" element. As the court stated in Latham, if
the plaintiffs had only alleged that Latham negligently failed to timely file their claim, their claim
would properly be one for legal malpractice. In this
case Ballesteros alleged and offered proof that
Jones was negligent in his representation of her and
charged an unconscionable fee. There is no evidence that any of Jones's conduct amounts to anything more than negligence, which the supreme
court in Latham said would require the "suit within
a suit" proof. There is no evidence that this negligent conduct was deceptive conduct as contemplated by the supreme court in Latham. To find unconscionable conduct in this case would require re-
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casting the negligence claim as a DTPA claim. FN5
FN5. Although not applicable to this case,
the DTP A was amended as of September I,
1995. The DTPA no longer applies to a
"claim for damages based on the rendering
of professional service, the essence of
which is the providing of advice, judgment, opinion, or similar professional
skill." TEX. BUS. & COM.CODE ANN.§
17.49(c) (Vernon Supp.1998). However,
an attorney may still be liable for an unconscionable action or course of action
that cannot be characterized as advice,
judgment, or opinion. Id. § 17.49(c)(3).
The amendment supports the idea that unconscionable action is more than negligent
conduct.
Thus, we find the evidence legally and factually insufficient to support a fmding for Ballesteros
under section 17.45(5)(A). We fmd that the judgment notwithstanding the verdict was proper because there is no evidence to support the jury's fmding on unconscionability. We overrule Ballesteros's
second point of error and sustain Jones's fourth
cross-point with regards to the jury's finding on unconscionability.
Having found insufficient evidence of unconscionability, we need not address Ballesteros's remaining points of error concerning the sufficiency
of the evidence to support a "knowing" violation of
the DTP A, the award of mental anguish damages,
and additional damages because they are dependent
upon a fmding of unconscionability. We affrnn the
judgment notwithstanding the verdict, that Ballesteros take nothing by way of her DTPA claim.
Damages
In her sixth point of error, Ballesteros alleges
that the evidence was legally sufficient to support
the jury's award of actual damages. Jones argues in
his fifth reply point that Ballesteros has waived her
right to challenge the judgment notwithstanding the
verdict as it relates to the damages question.
Page 17
In its answer to question six, the jury awarded
Ballesteros $560,000 in actual damages, representing (1) the difference in the value of the settlement
she received and the value of the settlement she
should have received if her suit had been properly
. prosecuted, and (2) the difference between the
value of services rendered by her attorney and the
amount of attorney's fees she paid. FN6
FN6. Question 6 reads:
What sum of money, if any, if paid in
cash, do you find from a preponderance
of the evidence would fairly and reasonably compensate Sandra Ballesteros for
her damages, if any resulting from the
conduct of James K. Jones, Jr., d/b/a
Law Office of Mann & Jones?
Consider the following elements of damages and none other. Do not include interest on any amount of damages you
fmd.
a. The difference in value of the settlement received by Sandra Ballesteros in
her cause of action against Andres Monetou because of the conduct of James K.
Jones, Jr., d/b/a Law Offices of Mann &
Jones and the value of the settlement that
she should have received had her suit
been properly prosecuted. The difference
in value, if any, shall be determined at
the time and place the settlement was
made.
b. The difference, if any between the attorney's fees charged Sandra Ballesteros
by James K. Jones, Jr., for services performed in connection with the settlement
of Sandra Ballesteros' claims against Andres Monetou and the value of those services. The difference in value, if any,
shall be determined at the time and place
the settlement was made.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d485)
Answer in dollars and cents for damages,
if any.
Answer: $560,000.00
[22] Jones's motion for judgment notwithstanding the verdict rested on several independent
grounds. Because the trial court's judgment did not
specify which grounds it was granted on, Ballesteros had the burden to establish that the judgment
could not be supported on any of the grounds *499
set out in Jones's motion. Fort Bend County Drainage Dist. v. Sbrusch, 818 S.W.2d 392, 394
(Tex.1991); Monk v. Dallas Brake & Clutch Serv.
Co., Inc., 697 S.W.2d 780, 783-84
(Tex.App.-Dallas 1985, writ refd n.r.e.). Otherwise, Ballesteros has waived her right to question
any ground not challenged. Monk, 697 S.W.2d at
784. Jones contends that Ballesteros has failed to
challenge the grounds asserted in paragraph three of
his motion.
[23] Ballesteros, on the other hand, argues that
Jones has waived his complaint because he failed to
object to the charge on the ground urged in his motion for judgment notwithstanding the verdict. An
objection to the charge based on legal insufficiency
of the evidence is not a prerequisite for a postverdict motion for judgment notwithstanding the
verdict. City of San Antonio v. Theis, 554 S.W.2d
278, 281 (Tex.Civ.App.-Tyler 1977, writ refd
n.r.e.), cert. denied, 439 U.S. 807, 99 S.Ct. 64, 58
L.Ed.2d 100 (1978); TEX.R. CIV. P. 279.
[24] Jones's complaints, however, are not related to the sufficiency of the evidence. He raises
two complaints in paragraph three of his motion.
Jones's initial complaint is that the answer to question 6(a) is immaterial because it asks the jury to
decide a question of law-the value of the settlement Ballesteros would have received in a successful divorce action. Jones was not required to object
to the charge to complain subsequently that a finding is immaterial. See Carey v. American Gen. Fire
& Cas. Co., 827 S.W.2d 631, 632
(Tex.App.-Beaumont 1992, writ denied). A quesPage 18
tion erroneously calling on the jury to answer a
question of law is classified as immaterial. See Cortimeglia v. Davis, 116 Tex. 412, 292 S.W. 875, 876
(1927); Portwood v. Buckalew, 521 S.W.2d 904,
912 (Tex.Civ.App.-Tyler 1975, writ refd n.r.e.).
Jones has not waived this argument.
[25] But we also hold that Ballesteros has not
waived hers. She argued in her brief that the evidence is legally sufficient to support the jury's finding of damages and that the judgment should be
entered on the jury's verdict. This must necessarily
be viewed as an argument that it is the jury's function to determine the amount of those damages, and
not a question of law for the court. Such an argument, of course, correctly states the law. See Westinghouse Elec. Corp. v. Pierce, 153 Tex. 527, 271
S.W.2d 422, 425 (1954) (amount of damages in a
negligence case is a jury question); Country Roads,
Inc. v. Witt, 737 S.W.2d 362, 365
(Tex.App.-Houston [14th Dist.] 1987, no writ)
(amount of unliquidated damages rests primarily
within the discretion of the jury). The case before
us is not a divorce case in which a trial court must
divide the marital estate. See TEX. F AM. CODE
ANN. FN7 th thi . § 3.63 (Vernon 1993). Ra er, s ts a
legal malpractice and DTP A case in which the
amount of damages sustained by the plaintiff is a
fact issue. See Cosgrove, 774 S.W.2d at 666
Gudgment rendered that plaintiff recover actual
damages in accordance with jury verdict);
Schlosser v. Tropoli, 609 S.W.2d 255, 259
(Tex.Civ.App.-Houston [14th Dist.] 1980, writ
refd n.r.e.) Gury question properly submitted actual
damages issue in legal malpractice case).
FN7. Act of June 2, 1969, 61st Leg., R.S.,
ch. 888, § 3.63, 1969 Tex. Gen. Laws
2707, 2725 (repealed 1997) (current version at TEX. FAM.CODE ANN. § 7.001
(Vernon Pamph.l998)). Section 3.63 was
repealed and reenacted as section 7.001
without substantive change.
[26] Jones's second complaint in paragraph
three of his motion is that disparate elements of the
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
985 S.W.2d485
(Cite as: 985 S.W.2d485)
damages issue are improperly intermingled in a
single answer. He argues that matters properly for
the jury's determination (the difference between the
attorney's fees charged and the value of the attorney
services provided) are improperly intermingled
with matters only the court could decide (the
amount Ballesteros should have recovered in her divorce action). Intermingling is an error that is
waived by failure to object to the charge. See Matthews v. Candlewood Builders, Inc., 685 S.W.2d
649, 650 (Tex.l985); Ked-Wick Corp. v. Levinton,
681 S.W.2d 851, 855 (Tex.App.-Houston [14th
Dist.] 1984, no writ); TEX.R. CIV. P. 274. It is not
necessary to challenge an argument waived by one's
opponent. Even if this argument were not waived,
Ballesteros's legal sufficiency argument must again
be viewed as a challenge to Jones's assertion *500
that the actual damages are for the court alone to,
decide. Reply point five is overruled.
[27] In his fifth cross-point, Jones argues that
question six improperly submitted the damage element because it failed to set forth the element of
"collectibility." In a legal malpractice suit based on
negligence, the plaintiff is required to establish that
any judgment that would have been obtained in the
underlying action, but for the attorney's breach of
duty, would have been collectible. See Cosgrove,
774 S.W.2d at 666. Jones objected to the omission
of the collectibility element. Although, a separate
question on collectibility is not required, that element must either be included in the damages question itself or it must be included in an instruction.
See Scholsser, 609 S.W.2d at 258-59. The measure
of damages submitted by the trial court was clearly
erroneous because it failed to limit the jury's consideration to the amount Ballesteros could have collected from Monetou in a settlement.
[28][29] Ballesteros had the burden of requesting a jury question on the proper measure of damages. W.O. Bankston Nissan, Inc. v. Walters, 754
S.W.2d 127, 128 {Tex.1988). A question that fails
to guide the jury on any proper legal measure of
damages is fatally defective. Jackson v. Fontaine's
Page 19
Clinics, Inc., 499 S.W.2d 87, 90 {Tex.1973). Remand for a new trial is required. See Turner, Collie
& Braden, Inc. v. Brookhollow, Inc., 642 S.W.2d
160, 166 (Tex.1982); !d.
[30] A separate trial on unliquidated damages
alone, however, may not be ordered if liability is
contested. TEX.R.APP. P. 44.l{b); Paragon Hotel
Corp. v. Ramirez, 783 S.W.2d 654, 662
(Tex.App.-El Paso 1989, writ denied). Because in
this case the damages are unliquidated and the liability issues are contested, remand of the negligence
claim is required. !d. We sustain Jones's fifth crosspoint.
We need not address Ballesteros's remaining
points concerning the sufficiency of the evidence to
support the finding of gross negligence and the exemplary damages award because they are conditioned upon a finding of negligence.
We affirm the judgment in part, that Ballesteros take nothing from Jones on her claim of unconscionability under the DTP A. We reverse and remand the judgment in part for a new trial on negligence.
Tex.App.-San Antonio,1998.
Ballesteros v. Jones
985 S.W.2d 485
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Westlaw,
824 So.2d 222, 27 Fla. L. Weekly D 1638
(Cite as: 824 So.2d 222)
H
District Court of Appeal of Florida,
Second District.
Toni T. BEHR, Appellant,
v.
Edward D. FOREMAN, individually, and Edward
D. Foreman, P.A., a professional association, Appellees.
No. 2D01-1897.
July 19, 2002.
Rehearing Denied Aug. 21, 2002.
Former divorce client filed action against her
former attorney for legal malpractice and breach of
fiduciary duty for his alleged failure to protect a
marital asset worth $4,000,000. The Circuit Court,
Pinellas County, Frank Quesada, J., entered summary judgment in favor of the attorney. Client appealed. The District Court of Appeal, Whatley, J.,
held that genuine issue of material fact existed as to
whether a broker's actions in losing entirety of
money in an investment account was reasonably
foreseeable by the attorney.
Reversed and remanded.
West Headnotes
[1] Judgment 228 €= 181(16)
228 Judgment
228V On Motion or Summary Proceeding
228k181 Grounds for Summary Judgment
228k181(15) Particular Cases
228k181(16) k. Attorneys, Cases Involving. Most Cited Cases
Genuine issue of material fact existed as to
whether broker's actions in losing entirety of money
in investment account, a marital asset valued in excess of $4,000,000, was reasonably foreseeable by
former client's attorney, while representing the client in connection with possible dissolution of marriage, thus precluding summary judgment in action
Page 1
for legal malpractice and breach of fiduciary duty.
[2] Judgment 228 €= 181(15.1)
228 Judgment
228V On Motion or Summary Proceeding
228k181 Grounds for Summary Judgment
228k181(15) Particular Cases
228k 181 (15 .1) k. In General. Most
Cited Cases
The issues of proximate cause, and foreseeability as it relates to proximate cause, are generally
not appropriate for determination by summary judgment, but are factual issues which must be resolved
by the trier of fact.
[3] Appeal and Error 30 €= 854(1)
30 Appeal and Error
30XVI Review
30XVI(A) Scope, Standards, and Extent, in
General
30k851 Theory and Grounds of Decision
of Lower Court
Cited Cases
30k854 Reasons for Decision
30k854(1) k. In General. Most
Trial courts may be right in entering summary
judgment for the wrong reasons.
*223 Michael C. Addison of Addison & Delano,
P.A., Tampa, for Appellant.
Jack Helinger of Louderback and Helinger, St.
Petersburg, for Appellees.
WHATLEY, Judge.
Toni T. Behr appeals the fmal summary judgment entered in her action against Edward D. Foreman, individually, and Edward D. Foreman, P.A.,
for legal malpractice and breach of fiduciary duty.
We agree with Behr that genuine issues of material
fact remain and precluded the finding that Foreman's actions were not the proximate cause of
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
824 So.2d 222, 27 Fla. L. Weekly Dl638
(Cite as: 824 So.2d 222)
Behr's loss.
Behr engaged the services of attorney Foreman
in connection with the possible dissolution of her
marriage to Charles Behr. At the time Foreman was
retained, the Behrs' principal marital asset was an
investment account at a brokerage house valued in
excess of $4,000,000. Even though this account was
a marital asset, Charles Behr maintained exclusive
control over it by establishing it in the form of a
trust with him as the sole trustee.
[1] In her complaint, Behr contended, inter alia,
that during the more than fifteen months after he
was retained to represent her, Foreman breached
the standard of care for attorneys by not protecting
her interest in this marital asset. As a result, Behr
alleged, she lost her interest in the asset when
Charles Behr lost the entirety of the money in the
brokerage account, in addition to a margin debt of
over $2,000,000.
In entering fmal summary judgment, the trial
court ruled that Behr herself had asserted in a complaint she filed against Foreman with The Florida
Bar that the losses were due to the actions of a
rogue broker. Because this broker had prudently
managed the account in the past, the court stated,
his actions were not reasonably foreseeable but
were a superseding, intervening cause of the losses
in the account. Consequently, the court concluded,
Foreman's actions or inactions did not as a matter
of law proximately cause the losses suffered by
Be hr.
*224 In this appeal, Behr asserts that her statement in the Bar complaint was merely a relaying of
information that her husband had provided in explaining the losses to the account; it was not an assertion that she herself believed a rogue broker's actions caused the losses she suffered. Thus, this is a
genuine issue of material fact that must be determined by the trier of fact.
[2] "The issues of proximate cause, and foreseeability as it relates to proximate cause, are genPage2
erally not appropriate for determination by summary judgment. These are factual issues which
must be resolved by the trier of fact." CSX Transp.,
Inc. v. Pasco County, 660 So.2d 757, 759 (Fla. 2d
DCA 1995). This is particularly true under the circumstances of this case because Foreman filed his
motion for summary judgment before he filed an
answer. Although this procedure is acceptable, Fla.
R. Civ. P. 1.510, it makes the movant's burden "an
especially heavy one" because the pleadings are not
closed. Lakes of the Meadow Vill. Homes Condo.
Nos. One, Two, Three, Four, Five, Six, Seven,
Eight, & Nine Maint. Ass'ns, Inc. v. Arvida/JMB
Partners, L.P., 714 So.2d 1120, 1122 (Fla. 3d DCA
1998).
[3] We note that Foreman raised as another
ground of his motion for summary judgment that
Behr's action is barred by the statute of limitations.
The trial court made no ruling or comment on this
ground in the fmal summary judgment. Trial courts
may be right for the wrong reasons. See Combs v.
State, 436 So.2d 93, 96 (Fla.l983). The resolution
of the issue of whether the statute of limitations has
run in this case turns, however, on a determination
of whether this case involves an allegation of litigation-related or transactional malpractice. See Silvestrone v. Edell, 721 So.2d 1173 (Fla.l998); Peat,
Marwick, Mitchell & Co. v. Lane, 565 So.2d 1323
(Fla.1990).
Accordingly, we reverse the fmal summary
judgment and remand for proceedings consistent
with this opinion.
PARKER and DAVIS, JJ., concur.
Fla.App. 2 Dist.,2002.
Behr v. Foreman
824 So.2d 222, 27 Fla. L. Weekly D1638
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
West law,
385 S.E.2d 95
192 Ga.App. 424, 385 S.E.2d 95
(Cite as: 192 Ga.App. 424, 385 S.E.2d 95)
H
Court of Appeals of Georgia.
BRYGIDER
v.
ATKINSON.
No. A89A0047.
July 3, 1989.
Rehearing Denied July 25, 1989.
Certiorari Denied Sept. 7, 1989.
Attorney brought an action to recover unpaid
attorney fees against a former client. The Fulton
State Court, Baxter, J., granted attorney's motion
for summary judgment on claim of breach of an oral contract. Client appealed. The Court of Appeals,
Beasley, J., held that material issues of fact as to
terms of agreement and reasonableness of fee
charged precluded grant of summary judgment in
favor of attorney.
Reversed.
Carley, C.J., concurred specially and issued an
opinion.
West Headnotes
[1] Judgment 228 E:= 181(16)
228 Judgment
228V On Motion or Summary Proceeding
228kl81 Grounds for Summary Judgment
228kl81(15) Particular Cases
228kl81(16) k. Attorneys, Cases Involving. Most Cited Cases
Material issue of fact as to terms of oral employment agreement between attorney and client
and reasonableness of fee charged by attorney precluded grant of summary judgment in favor of attorney in suit for attorney fees.
[2] Judgment 228 €= 185.3(4)
Page 1
228 Judgment
228V On Motion or Summary Proceeding
228kl82 Motion or Other Application
228kl85.3 Evidence and Affidavits in
Particular Cases
228kl85.3(4) k. Attorneys. Most Cited
Cases
In a suit brought by attorney to collect alleged
unpaid fees against client, client's affidavit in opposition to motion for summary judgment, which
stated that based on his experiences as a businessman and his previous dealings with attorneys, he
was of the opinion that the hours and charges attorney was claiming were unpaid were excessive, was
sufficient to raise a material issue of fact as to reasonableness of fee.
**95 *427 King, Morriss, Talansky & Witcher,
Joseph H. King, Jr., Atlanta, for appellant.
Tyros B. Atkinson, Jr., pro se.
*424 BEASLEY, Judge.
Brygider, a former client of attorney Atkinson,
appeals the grant of summary judgment to Atkinson
in this suit over unpaid attorney fees.
Recovery was sought under three theories, but
the motion for summary judgment is based only on
Count One, breach of an oral contract.
The controversy for which Atkinson was hired
involved a product, a "guardfather" produced by
Bingham, Ltd., of which Brygider**96 was president. The Federal Bureau of Investigation contended
that the device was an illegal switchblade knife. It
looked like a ballpoint pen but had a button which '
when pushed, caused an icepick-like shaft to
emerge and lock into place. Brygider does not dispute that there was a contract of employment, but
rather that Atkinson was retained by him as an individual as opposed to a corporate officer. He also
disputes the reasonableness of the fees.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
385 S.E.2d 95
192 Ga.App. 424, 385 S.E.2d 95
(Cite as: 192 Ga.App. 424, 385 S.E.2d 95)
*425 The government was granted summary
judgment in the federal suit on the ground there was
no justiciable case or controversy. This was reversed on appeal to the Eleventh Circuit in 1985. A
second motion for summary judgment was made
and granted to the government on the merits, resulting in a second appeal.
Brygider paid the bill resulting from the first
appeal through May 1986, but when he was billed
after the second brief was filed, he took exception
to the $5,000 charge for the second appeal and contended that the first brief was merely "reworked"
for the second. Also, approximately $3,000 in past
due billings from the first appeal appeared on that
bill. The briefs themselves are in the record and do
reflect some overlap. Brygider contends that, while
he did authorize the filing of the second appeal,
there was a $2,000 fee cap for it.
[I] Atkinson moved for summary judgment.
His supporting affidavit included: "I state that the
sum of $5,000.00 to brief an appeal in the United
States Court of Appeals is a reasonable attorney fee
for a case of the nature of the one performed by me
for the benefit of Mr. Brygider. In my opinion a fee
of $10,000 for such an appeal would not be unreasonable .... All services rendered by me were reasonable and necessary to adequately represent Mr. Brygider." Also included was a statement of Atkinson's
experience as an attorney, as a basis for his opinions as to the fee's reasonableness.
In his opposing affidavit, Brygider stated he
had substantial expertise, as president of Bingham,
Ltd., in the reasonableness of attorney fees. "This
expertise has been acquired in the course of 15
years of business practice. I have supervised and reviewed the billing of numerous attorneys, including
[Atkinson], and have become familiar with the
practices in Georgia regarding such fees, and the
standards of reasonableness applied in determining
such fees. I have reviewed the fees ... in this case,
and I have the opinion that they are unreasonable."
Six bases were set out for the conclusion, including
the overlap in the two briefs, charges made for such
Page2
items as "familiarization with rules which should
already have been familiar," and that the time spent
and fee charged were beyond his specific authorization.
Although Atkinson states in his brief that he
objected to Brygider's affidavit, no hearing transcript or other evidence of such objection is in the
record. "A brief cannot be used in lieu of the record
or transcript for adding evidence to the record.
[Cits.] We must take our evidence from the record
and not from the brief of either party." Blue v. R.L.
Glosson Contracting, 173 Ga.App. 622, 623( I),
327 S.E.2d 582 (1985); In re Holly, 188 Ga.App.
202, 203, 372 S.E.2d 479 (1988); see Chapman v.
McClelland, 248 Ga. 725, 726(2), 286 S.E.2d 290
(1982). Nevertheless, whether he objected or not,
the legal efficacy of the affidavit would still have to
be determined on appeal on addressing the summary judgment issue.
*426 The trial court was bound to construe the
evidence in favor of Brygider, the party opposing
the motion. Eiberger v. West, 247 Ga. 767, 769(1),
281 S.E.2d 148 (1981); Mitchell v. Rainey, 187
Ga.App. 510, 512, 370 S.E.2d 673 (1988). Summary judgment was appropriate only if there was no
genuine issue as to any material fact and the law
demanded judgment for Atkinson. OCGA §
9-ll-56(c).
It would have been demanded only if there was
no dispute that Atkinson and Brygider had agreed
that Atkinson was to spend as much time as reasonable to produce the second brief; that there was no
cap on the fee; and that $5,000 was reasonable.
There is clearly a dispute as to the first two items,
with Brygider stating he **97 did place a cap and
Atkinson stating he did not. This matter of credibility is peculiarly for the jury. OCGA § 24-9-80.
Also, the fact that two opinions have been given as
to the reasonableness of the fee itself, defeats summary judgment.
"[W]hen the evidence on a dispositive issue
consists of opinion evidence, such evidence alone
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
385 S.E.2d 95
192 Ga.App. 424, 385 S.E.2d 95
(Cite as: 192 Ga.App. 424, 385 S.E.2d 95)
can never sustain an award of summary judgment.
[Cits.] Introduction of opinion evidence by the nonmoving party, however, ... can be sufficient to preclude an award of summary judgment. [Cits.]" Scott
v. Owens-Illinois, 173 Ga.App. 19, 22(2), 325
S.E.2d 402 (1984); Bryan v. Bryan, 248 Ga. 312,
282 S.E.2d 892 (1981); Dickson v. Dickson, 238
Ga. 672, 674(2), 235 S.E.2d 479 (1977); Hepner v.
Southern R. Co., 182 Ga.App. 346, 349(1), 356
S.E.2d 30 (1987).
[2] This case is similar to Spears v. Allied Engineering Assoc., 186 Ga.App. 878, 368 S.E.2d 818
(1988). Spears, a developer and builder, hired Allied to perform engineering services. Although the
hourly rate for the services had been agreed upon,
there was a "factual dispute over the number of
hours it actually took or should have taken for the
work to be performed. Therefore, summary judgment was inappropriate as to the amount Spears
owed Allied. [Cit.]" Spears' affidavit based on his
experience as a builder and developer, expressed
his opinion that the hours expended and the charges
made for engineering services were excessive. Brygider, based on his experience as a businessman
and his previous dealings with attorneys, expressed
his opinion that the hours and charges were excessive. This sufficed to defeat summary judgment.
Judgment reversed.
McMURRAY, P.J., concurs.
CARLEY, C.J., concurs specially.
CARLEY, Chief Judge, concurring specially.
I agree with the majority that summary judgment was improper because there were genuine issues of material fact as to the terms and conditions
of the contract between the client and the attorney. I
do not agree with the majority that Spears v. Allied
Engineering Assoc., 186 Ga.App. 878, 368 S.E.2d
818 (1988) is applicable to this case in such a manner as to require a finding that the affidavit of the
client is sufficient to raise an issue as to the
"reasonableness" of the fee. However, there being a
genuine issue as to the terms of the contract
between the parties, summary judgment was improper.
Ga.App.,l989.
Brygider v. Atkinson
192 Ga.App. 424, 385 S.E.2d 95
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page3
Westlaw,
901 S.W.2d 842
321 Ark. 376,901 S.W.2d 842
(Cite as: 321 Ark. 376,901 S.W.2d842)
c
Supreme Court of Arkansas.
George M. CALLAHAN et al., Appellants,
v.
Mary Ellen CLARK, Appellee.
No. 94-1361.
July 17, 1995.
Client sued her attorney for legal malpractice,
alleging that attorney negligently advised client to
sign property settlement agreement in underlying
divorce action, resulting in substantial loss to client
when she was unable to renew note on her and
former husband's business premises. The Circuit
Court, Garland County, Walter G. Wright, J.,
entered judgment on jury verdict for client. Attorney appealed. The Supreme Court, Holt, C.J., held
that: (1) jury's award was based on substantial evidence, and (2) attorney was not entitled to introduce
evidence that client eventually lost custody of her
children.
Affirmed.
West Headnotes
[1] Appeal and Error 30 E:= 930(1)
30 Appeal and Error
30XVI Review
Cases
30XVI(G) Presumptions
30k930 Verdict
30k930(1) k. In general. Most Cited
Appeal and Error 30 E:= 1001(1)
30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and
Findings
30XVI(I)2 Verdicts
30k1001 Sufficiency of Evidence in
Page 1
Support
30kl001(1) k. In general. Most
Cited Cases
Supreme Court's standard in reviewing sufficiency of evidence is as follows: (1) evidence is
viewed in light most favorable to nonmoving party;
(2) jury's fmding will be upheld if there is any substantial evidence to support it; and (3) substantial
evidence is that of sufficient force and character to
induce mind of factfinder past speculation and conjecture.
[2] Negligence 272 E:= 372
272 Negligence
272XIII Proximate Cause
272k372 k. Necessity of legal or proximate
causation. Most Cited Cases
(Formerly 272k56(1.3))
To prove negligence in Arkansas, plaintiff must
show that he or she suffered damages proximately
caused by defendant's negligence.
[3] Attorney and Client 45 E:= 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kll2 k. Conduct of litigation. Most Cited
Cases
To show damages and proximate cause in legal
malpractice action, plaintiff must show that but for
alleged negligence, result would have been different in underlying action.
[4] Attorney and Client 45 E:= 107
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl07 k. Skill and care required. Most Cited
Cases
In Arkansas, attorney is negligent if he fails to
exercise reasonable diligence and skill on behalf of
his client.
[5] Attorney and Client 45 E:= 129(2)
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
901 S.W.2d842
321 Ark. 376, 901 S.W.2d 842
(Cite as: 321 Ark. 376,901 S.W.2d 842)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(2) k. Pleading and evidence. Most
Cited Cases
Evidence in legal malpractice action was sufficient to support jury's finding that attorney was
negligent in advising client in underlying divorce
action to sign property settlement agreement, and
that client sustained damages in amount of
$248,000; evidence indicated that client's inability
to renew note on business premises resulted in loss
of $150,000 in lease payments and $98,000 in
equity she had in marital home, that default provision in parties' agreement permitted such result,
that attorney should have included provision in
agreement that husband either personally guarantee
lease agreement or that he agree in writing to help
client renew note, and that attorney should have
been aware that client was not going to be able to
renew note.
[6) Appeal and Error 30 €= 230
30 Appeal and Error
30V Presentation and Reservation in Lower
Court of Grounds of Review
30V(B) Objections and Motions, and Rulings
Thereon
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**843 *378 James M. Moody, Troy A. Price, Little
Rock, for appellant.
Kent J. Rubens, Timothy 0. Dudley, West Memphis, for appellee.
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(Cite as: 321 Ark. 376, 901 S. W.2d 842)
HOLT, Chief Justice.
This is a legal malpractice case arising out of
appellant George Callahan's representation of appellee Mary Ellen Clark in a divorce action. The
case was submitted on interrogatories, whereby the
jury concluded that Mr. Callahan was negligent in
failing to determine the value of the marital business, setting damages at $120,000.00, and in advising Ms. Clark to sign the property settlement
agreement awarding damages of $248,000.00 in
this regard. The trial court entered judgment against
Mr. Callahan and his law firm accordingly.
Mr. Callahan and his law firm appeal, asserting
four specific points of error: (1) that the jury's
award of $248,000 for negligence was based on
conjecture and speculation, rather than on the required substantial evidence of damages flowing
from specific breaches; (2) that the jury's award of
$120,000 for negligent failure to value marital assets could only have been based on conjecture and
speculation since the jury did not and could *379
not have found that the court would have awarded
such an amount; (3) that the trial court erred in allowing Ms. Clark's trial counsel to taint the proceedings below with unfairly prejudicial evidence
of a supposed ethical violation by Mr. Callahan;
and (4) that the trial court erred in refusing to allow
Mr. Callahan to introduce evidence that Ms. Clark
eventually lost custody of her children, the threat of
which strongly bore on her inclination to sign the
property settlement agreement. None of these arguments has merit. We affirm.
Facts
In March of 1989, appellee Mary Ellen Clark
hired appellant George Callahan, an attorney with
the firm of Callahan, Crow, Bachelor, and Newell
of Hot Springs, to obtain what she thought would
be an uncontested divorce from her husband, Harvey Clark, to whom she had been married for over
eight years. When Ms. Clark first met with Mr. Callahan, she outlined her objectives in the divorce as
follows: (1) that she receive custody of the couple's
four children; (2) that she retain some role in operaPage3
tioli of their business, Clark Industries, Inc., which
produced replacement parts for classic cars, and
which was operated out of a "shop" building on a
small piece of land adjacent to the marital residence; and (3) that she obtain a steady income for
herself and her children.
Shortly after Ms. Clark's initial meeting with
Mr. Callahan, the divorce proceedings became bitterly contested. Mr. Clark sought custody of the
children, and the business became the subject of
much disagreement. Particularly, the Clarks accused each other of draining business assets and
improperly using business funds, and the Internal
Revenue Service ultimately imposed a tax lien on
the business, with the Clarks facing personal liability for failure to withhold payroll taxes. Thereafter,
the chancellor appointed Robert Ridgeway, an attorney who had previously represented the Clarks,
as a special master to oversee Clark Industries.
Following the exchange of several drafts, the
Clarks executed a settlement agreement in January
of 1990 relating to both custody and division of
their marital property. Ms. Clark was awarded custody of the children, and Mr. Clark agreed to pay
$1200 per month in child support. Although Ms.
Clark was no *380 longer living there, she became
the owner of the marital residence and the land on
which the shop was located. Mr. Clark was permitted to continue to operate the business, but was required to pay Ms. Clark $3000 per month in rent for
a period of five years for use of the property. In
tum, Ms. Clark agreed to transfer all of her stock in
the business to Mr. Clark, who, upon execution of
the agreement, paid Ms. Clark $10,000 cash, $3000
in vacation pay, and $2766.33 in reimbursement for
sums Ms. Clark had advanced to the business. Additionally, Mr. Clark paid $10,000 toward Mr. Callahan's attorney's fees, and agreed to assume full responsibility for the outstanding taxes reflected in
the tax lien.
The property settlement agreement contained
provisions that imposed responsibilities **844 and
risks on both parties, which included the condition
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that if Ms. Clark defaulted on the mortgage payments for either the marital residence or the shop,
Mr. Clark could reclaim and obtain ownership of
both pieces of property by paying the overdue payments and attorneys fees or costs. Conversely, if
Mr. Clark defaulted on any of his required payments, Ms. Clark was given the right to reenter the
premises of the business and to attach and sell all
corporate assets.
In May of 1990, some four months after executing the settlement agreement, the bank note on
the shop property became due and Mr. Clark refused to sign an extension of the note; thus, Ms.
Clark was unable to refinance her loan. The bank
initiated foreclosure proceedings, and Mr. Clark exercised his right under the agreement to reclaim the
house and shop, and terminated the $3000 per
month lease payments to Ms. Clark. Thereafter, Ms.
Clark filed an action for malpractice against Mr.
Callahan and his law firm, alleging, among other
things, that he was negligent both in failing to have
Clark Industries valued, and in advising her to sign
the property settlement agreement. She amended
her complaint to include Robert Ridgeway, the special master, as a separate defendant, but the trial
court later dismissed Mr. Ridgeway upon Ms.
Clark's motion.
The case proceeded to trial. Ms. Clark's first
witness was the appellant, Mr. Callahan, who stated
that he had been practicing law for 26 years. In order to value Clark Industries, he examined four to
five years of tax returns, fmancials that Ms. Clark
and Elaine Simpson, Ms. Clark's sister and parttime bookkeeper *381 for Clark Industries, had
provided to him, and the master's full reports containing accounts receivable and accounts payable
information. In addition to reviewing these documents, Mr. Callahan walked through the business
and looked at the equipment, and telephoned Ron
Reagan, the owner of Chemfab, a similar business
which manufactured aircraft parts, who advised him
that liquidation of Clark Industries would not be in
Ms. Clark's best interests.
Page4
As it was his understanding that custody was
Ms. Clark's top priority, Mr. Callahan stated that he
knew she would have to make some concessions
with regard to the business, recognizing that the
Clarks could not jointly operate the business, and
that its real value was the genius of Mr. Clark, who
had the contacts and identified the market. According to Mr. Callahan, he was able to give Mr. Clark
much of the marital debt in the agreement, and obtained for Ms. Clark substantial hard assets-the
real estate, home, building, and other personal
property. Mr. Callahan testified that he explained to
Ms. Clark that pursuant to the agreement, both
parties ran substantial risks; however, he stated that
he did not know that the bank would not let the
$24,000 note on the shop be refinanced unless both
parties signed it, and that he did not check with the
bank as to whether Mr. Clark's signature would be
required. He explained that there was never any
presumption that Mr. Clark would be responsible
for the note, as Ms. Clark had told him that she
would not go back to One Bank, who had the note,
as she did not like their rate of interest. According
to Mr. Callahan, Ms. Clark "constantly reassured"
him that she would be able to refmance the note
and deal with the risk.
Patty Ann Lueken, a licensed attorney since
1989, testified as an expert witness on behalf of
Ms. Clark, stating that 50 percent of her practice
was devoted to domestic relations cases. She reviewed the files in the case, and offered her opinion
that, a deposition or set of interrogatories would
have been very helpful in order to value Clark Industries. Particularly, she stated that she would
have taken Mr. Clark's deposition in order to determine what he thought the value of the company
was, and would have used his deposition as a negotiating tool. It was Ms. Lueken's opinion that it was
necessary to get an expert as to the value of the
business in the case, and that Mr. Callahan failed to
meet the applicable standard of care in his representation of Ms. Clark.
*382 According to Ms. Lueken, paragraph 19,
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the default prov1s1on of the property settlement
agreement, put Ms. Clark in a terrible position in
that if she could not renew the note on the shop in
May of 1990, she ended up with nothing, with the
exception of a **845 party barge, a Bronco, and
some other personal items. This provision reads as
follows:
In the event that the Wife defaults on the mortgage payment for either the home or the shop
building note or notes, the Husband has the right
to buy back the home, the land the home is situated on, the shop building and the land that the
shop building is situated on by paying only the
back payments owed at that time plus attorney's
fees or other costs in order to bring the note or
notes current. The default by the Wife on these
payments is agreed by the parties to be defined as
late payments sufficient to necessitate legal action by the filing of a Complaint for Foreclosure
in order to collect these past due amounts by an
attorney.
It was Ms. Lueken's opinion that Mr. Callahan,
in advising Ms. Clark to sign this agreement containing this provision, should have been aware of
what liabilities Ms. Clark had, as his file clearly
showed that she was not going to be able to renew
the note, as it reflected that some of her credit cards
had been cut off, the Bronco payment was behind,
and that there were IRS liens for which she was
partially responsible. According to Ms. Lueken, this
provision provided that, in the event that Ms. Clark
defaulted, Mr. Clark would get whatever was left
over after foreclosure, without having to pay any of
the equity in the shop or the remaining portion of
the $180,000 lease payment to Ms. Clark.
Moreover, the lease payment, Ms. Lueken stated,
would actually be paid by Clark Industries, which
was owned by Mr. Clark. After costs, Ms. Lueken
estimated that Mr. Clark would receive an additional $70,000 to $80,000 as a result of this provision.
Philip Dixon, a licensed attorney since 1960
with 60 to 70 percent of his practice devoted to domestic relations, testified out of tum as an expert
PageS
witness on behalf of Mr. Callahan. It was his opinion, after reviewing the files in the case, that Mr.
Callahan met the applicable standard of care and
performed the due diligence that was required of
him in the representation of Ms. *383 Clark. It was
Mr. Dixon's opinion that Mr. Callahan had more
discovery and more information available to him
overall than many attorneys get throughout a lawsuit, specifically referring to the reports of the master. He testified that he had reviewed the deposition
of Dr. Ralph Scott, Ms. Clark's economist, and that
he disagreed with his assumptions made in arriving
at his figures. Particularly, he stated that Dr. Scott
assumed that both parties could walk away from the
business and still continue to have an income
stream of$100,000.
Regarding paragraph 19 of the agreement, Mr.
Dixon stated that he was aware that Ms. Lueken
had criticized Mr. Callahan for not having Mr.
Clark personally guarantee the lease agreement, or
in not having him agree in writing to help Ms.
Clark renew the note. It was Mr. Dixon's opinion
that, as Mr. Callahan had stated that he had
counseled Ms. Clark regarding her debts and that
she assured him that she had the means to take care
of the situation, Mr. Callahan's conduct in advising
Ms. Clark to sign the property settlement agreement, which included the provision in paragraph
19, was reasonable under the circumstances. On
cross-examination, however, Mr. Dixon stated that
he had never seen a default provision like the one in
paragraph 19 of the agreement.
Elaine Simpson testified on her sister's behalf,
as she had done some bookkeeping at Clark Industries. She stated that she was present at a few meetings between Ms. Clark and Mr. Callahan, and that
she had given Mr. Callahan a note reading, "If we
do not have someone do a current inventory of assets currently at this plant, Mary will lose thousands of dollars as this list doesn't include the hundreds of dies nor a large portion of tools in the tool
and die shop. These are high dollar values." Ms.
Simpson further stated that she did not receive a re-
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901 S.W.2d 842
321 Ark. 376, 901 S.W.2d 842
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sponse to her note; rather, Mr. Callahan repeatedly
requested her sister to make lists. At one meeting
for settlement negotiations, Ms. Simpson claimed
that there was a discussion as to whether Mr. Clark
would be required to sign the renewal note for the
shop when it came up at One Bank in May of 1990.
According to Ms. Simpson, Mr. Clark, who was
present at the meeting with his attorney, agreed to
keep his name on the note for five years.
**846 Mary Clark testified as to her involvement in Clark Industries, stating that she talked to
Mr. Callahan numerous times *384 about obtaining
an inventory of the business. It was her testimony
that she did not want to sign the agreement with the
default provisions in paragraph 19, but that Mr.
Callahan insisted that it had to be there without explaining why. She further testified that Mr. Callahan knew that Mr. Clark's name had to remain on
the note for the shop, and that Mr. Callahan assured
her that paragraph 30 of the agreement obligated
Mr. Clark to sign the extension in May of 1990.
Paragraph 30 states as follows:
That each of the parties agree to cooperate with
the other in executing such instruments as shall
be necessary to perform the agreements herein
contained, and each of the parties do hereby bind
themselves and their respective personal representatives, heirs and assigns to perform and keep
the agreements herein contained.
In May of 1990, when Mr. Clark refused to
sign the extension agreement, Ms. Clark stated that
she tried to extend it on her own with another bank,
but her credit was too bad.
Over Mr. Callahan's objection, Dr. Ralph Scott,
an economist, testified that he valued the business
based on the year 1988, stating that it grew steadily
up until that time. He calculated owner compensation at $113,000 and subtracted corporate loss of
$20,735 for a total of $92,266 as a measure of the
Clark's compensation. From that figure, Dr. Scott
subtracted $30,000, based on a Department of
Labor publication, for what it would have cost the
Page6
Clarks to hire a bookkeeper, thus leaving $62,266.
He used this figure to make a projection for the
next 15 years, or Ms. Clark's work life expectancy,
arriving at a figure of $692,297, one-half of which
is $346,148. From listening to the testimony, Dr.
Scott opined that one-half of the outstanding tax liability should be subtracted from this amount. He
further stated that he would have arrived at a much
higher figure had he factored in growth of the company and fringe benefits. He compared the business
to a physician's practice, stating that it should be
viewed as an asset that is going to generate income
like a stock or bond.
At the close of Ms. Clark's case, Mr. Callahan
made specific motions for directed verdict based on
lack of competent evidence that any act or omission
on his part proximately caused damages, and on
lack of competent evidence from which the jury
*385 could reach a verdict without speculation as to
how a chancellor could effect a remedy which
would have entitled Ms. Clark to one half of the
business. The trial court denied both motions, and
Mr. Callahan presented the testimony of Stephany
Slagle, the attorney for Mr. Clark during the divorce proceeding, who testified as to the complexity of the case. She stated that if no agreement had
been reached and the company had to be liquidated
according to the usual practice in Garland County,
it would have destroyed both Mr. Clark and Ms.
Clark fmancially. She stated that there was never a
meeting at which she, Ms. Simpson, Mr. Clark, and
Ms. Clark were present where Mr. Clark made a
promise that he would renew the note in May of
1990. She stated that she would have remembered
such a promise had one been made, as she would
not have believed it. Ms. Slagle further opined that
in August 1989, the business could not be valued
without knowing what Ms. Clark had done, as she
was paying for her race horses, personal vehicle,
babysitters, and other things which were completely
out of Mr. Clark's control. In December of 1989,
according to Ms. Slagle, the business was "worth
very little, if not in the hole." Like Mr. Callahan,
Ms. Slagle did not hire an appraiser or anyone to
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make a valuation of the business.
Harvey Clark testified that by the fall of 1989,
he did not think the business would break even with
the debt he and Ms. Clark had. He stated that he
told his wife that he would sign the note until the
time the divorce was fmal. According to Mr. Clark,
when she raised the question about his signing the
note during one of the final negotiation sessions,
she retracted her question, stating that she was going to refinance the note, and that she thought she
might sell it. Mr. Clark testified that, had his signature on the note been proposed as a condition to the
agreement, he **847 did not think that he would
sign it, stating that he would not want to secure
something for his landlord.
Mr. Callahan renewed all motions and objections at the conclusion of all of the evidence, which
the trial court denied. The trial court submitted separate interrogatories to the jury, from which the
jury found Mr. Callahan negligent in advising Ms.
Clark to sign the settlement agreement, and that she
sustained damages in the amount of $248,000. Mr.
Callahan appeals.
*386 I. Jury award for negligence
For his first allegation of error, Mr. Callahan
asserts that the jury's award of $248,000 for negligence in advising Ms. Clark to sign the property
settlement agreement was based on conjecture and
speculation, rather than on the required substantial
evidence of damages flowing from specified
breaches. This amount was obviously predicated on
the $3000 per month lease payments Ms. Clark lost,
calculated as 60 required payments or $180,000,
less ten payments made or $30,000, for a subtotal
of $150,000, together with $98,000 in equity she
had in the marital home, for a total of
$248,000-the exact amount of the verdict.
[1][2][3][4] As Mr. Callahan appeals from the
trial court's denial of his motion for directed verdict
as to proof of negligence and resulting damages, he
is challenging the sufficiency of the evidence. Our
standard in reviewing the sufficiency of the evidPage7
ence is well settled: ( 1) The evidence is viewed in a
light most favorable to the non-moving party; (2)
the jury's fmding will be upheld if there is any substantial evidence to support it; and (3) substantial
evidence is that of sufficient force and character to
induce the mind of the factfmder past speculation
and conjecture. Quinney v. Pittman, 320 Ark. 177,
895 S.W.2d 538 (1995). Moreover, to prove negligence in Arkansas, the plaintiff must show that he
or she suffered damages proximately caused by the
defendant's negligence. Vandeiford v. Penix, 39
F.3d 209 (8th Cir.l994), citing Arkansas Kraft v.
Cottrell, 313 Ark. 465, 855 S.W.2d 333 (1993). To
show damages and proximate cause in a legal malpractice action, the plaintiff must show that but for
the alleged negligence, the result would have been
different in the underlying action. Vandeiford v.
Penix, supra. In Arkansas, an attorney is negligent
if he fails to exercise reasonable diligence and skill
on behalf of his client. /d., citing Arkansas Kraft v.
Cottrell, supra, Welder v. Mercer, 247 Ark. 999,
448 S.W.2d 952 (1970).
[ 5] In support of his argument that Ms. Clark
failed to prove that Mr. Clark would have agreed to
a more favorable settlement, or that litigation to
judgment would have yielded a better result, Mr.
Callahan relies in part on the following passage
from Roger E. Mallen's and Jeffrey M. Smith's recent treatise on attorney malpractice, in which they
state as follows:
Assuming a cause of action [for negligent settlement] *387 can be stated, the client must not
only establish that concluding such a settlement
fell outside the standard of care, but also what
would have been a reasonable settlement and that
such sum would have been agreed to and collectible.
In evaluating and recommending a settlement,
the attorney has broad discretion and is not liable
for a mere error in judgment.
Ronald E. Mallen & Jeffrey M. Smith, Legal
Malpractice § 24.36 at 521 (1989). However, Mal-
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len and Smith also speak on speculative damages as
follows:
The general rule is that an attorney is not liable
for any damages which are remote or speculative.
The test of whether damages are remote or speculative has nothing to do with the difficulty in calculating the amount, but rather the more basic
question of whether there are identifiable damages . . . No one can precisely say what the
plaintiff lost or should have lost in such situations, but difficulty or imprecision in calculating
damages does not exculpate the attorney. Even
though damages cannot be calculated precisely,
they can be estimated. Otherwise, attorneys could
avoid liability merely because damages are difficult to measure.
Mallen & Smith, § 16.3 at 894-895 (1989).
(Emphasis added.)
**848 In reviewing the evidence before us, we
ascertain that sufficient facts existed by which the
jury could find evidence of negligence, and from
which the jury could identify and assess damages
which were not remote or speculative. As such, a final resolve of this case hinged on which witnesses
the jury chose to believe.
We have long stated that it is the province of
the jury to weigh the credibility of the witnesses.
Quinney v. Pittman, supra. As such, the jury was
free to believe the testimony of Ms. Clark and her
sister, Ms. Simpson, over that of the other witnesses, that Mr. Callahan assured Ms. Clark that the
agreement required Mr. Clark to extend the note in
May of 1990 and beyond, and that Mr. Clark had
verbally agreed to sign the extension. In light of
Ms. Lueken's testimony that Mr. Callahan should
have included a provision in paragraph 19 that Mr.
Clark either personally guarantee the lease agreement, or that he agree in writing*388 to help Ms.
Clark renew the note, the jury could have reasonably concluded that either a guarantee or an agreement to help renew the note should have been made
a part of the contract. There was also testimony
from Ms. Lueken that Mr. Callahan should have
PageS
been aware of what liabilities Ms. Clark had, as his
file clearly showed that, due to her numerous expenses, she was not going to be able to renew the
note. Even Mr. Dixon, Mr. Callahan's own expert,
testified that in his 35 years of practice, he had never seen a default provision like the one in paragraph
19 of the settlement agreement, which operated in
Mr. Clark's favor when Ms. Clark defaulted on the
shop note.
As Ms. Clark correctly states in her brief, her
damages were indeed identifiable, for her default
was a result of Mr. Clark not being required to sign
the renewal on the shop note. As mentioned previously, Ms. Clark lost $150,000 in lease payments
and $98,000 in equity she had in the marital home
totally $248,000, the amount of the jury verdict.
Under these circumstances, we cannot say that the
trial court erred in failing to direct a verdict in Mr.
Callahan's favor, as there was substantial evidence
to support both the jury's fmding on interrogatories
that Mr. Callahan was negligent in advising Ms.
Clark to sign the property settlement agreement,
and that Ms. Clark sustained damages in the
amount of $248,000.
II. Failure to value business
For his second argument on appeal, Mr. Callahan asserts that the jury's award for $120,000 for
negligent failure to value marital assets could have
only been based on conjecture and speculation,
since the jury did not and could not state that the
court would have awarded that amount. In his reply
brief, Mr. Callahan concedes that this issue is only
relevant if we hold in his favor on the first issue. As
stated above, we find no merit to Mr. Callahan's
first point on appeal; thus, we need not address his
second argument.
III. Ethical inquiry
[6][7] Mr. Callahan further argues that the trial
court erred in allowing Ms. Clark's counsel to taint
the proceedings below with unfairly prejudicial
evidence of a supposed ethical violation. Ms. Clark
called Mr. Callahan as her first witness, and he
*389 was questioned about a letter that he had writ-
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(Cite as: 321 Ark. 376, 901 S.W.2d 842)
ten to her in April of 1989, in which he set a minimum fee of $2500, and stated that her divorce
would not be fmalized until her account with his
firm was paid in full. When counsel for Ms. Clark
inquired as to whether this was a proper fee arrangement, Mr. Callahan replied that "There's some
disagreement about that," stating that, "There is an
ethical opinion that says that if your client cannot
pay you, that you must continue to represent her
and to see that her rights are protected regardless of
whether you are paid or not." After Mr. Callahan
offered further testimony regarding his fees, counsel for Mr. Callahan made a relevancy objection,
which the trial court overruled. Thereafter, the trial
court admitted into evidence, over Mr. Callahan's
relevancy objection, legal bills that Mr. Callahan
had sent Ms. Clark, finding that the bills could be
used to attack Mr. Callahan's credibility. During
cross-examination of Mr. Callahan's expert, Phillip
Dixon, Ms. Clark was allowed to question him,
over Mr. Callahan's objection, regarding his opinion as to whether Mr. Callahan's fee **849 arrangement was ethical. Finally, during closing argument,
counsel for Ms. Clark stated as follows:
Mr. Dixon ... told you that the first thing [Mr.
Callahan] did was unethical. He wrote a fee
agreement that said, "We are not going to enter a
divorce decree until you have paid all of our fee."
Under our rules of ethics, as Mr. Dixon told
you that is an unethical thing for a lawyer to do.
The very first thing he did in this case, writing
the fee agreement, was unethical and had to do
with money.
We need not explore this issue further, as Mr.
Callahan did not make a contemporaneous objection to the admission of this testimony; instead, he
allowed counsel for Ms. Clark to ask some 17 additional questions before registering an objection with
the trial court. A contemporaneous objection is necessary in order to preserve an issue for appellate
review. Johnson v. State, 308 Ark. 7, 823 S.W.2d
800 (1992). As Mr. Callahan had offered similar
testimony, Mr. Dixon's testimony on this issue was
Page9
merely cumulative. We will not find prejudicial error where the evidence erroneously admitted was
merely cumulative. Williams v. Southwestern Bell,
319 Ark. 626, 893 S.W.2d 770 (1995). Thus, the
*390 admission of Mr. Dixon's testimony was
harmless error. As to comments made by Ms.
Clark's counsel during closing argument, we find
no objection made by Mr. Callahan in the abstract
or in the record. Under these circumstances, Mr.
Callahan's argument is without merit.
IV. Evidence regarding custody
[8] Finally, Mr. Callahan asserts that the trial
court erred in refusing to allow him to introduce
evidence that Ms. Clark eventually lost custody of
her children, the threat of which strongly bore on
her inclination to sign the property settlement
agreement. He contends that if the jury had been
made aware of Mr. Clark's strong desire to obtain
custody, "it might well have evaluated Callahan's
advice in a different light."
[9] The trial court sustained Ms. Clark's relevancy objection to this evidence, stating that it was
"after the fact" evidence, and that it might lead to
more rebuttal testimony. We have often stated that
the trial court determines the relevancy, competency, and probative value of testimony; it is within
the trial court's discretion whether to admit testimony, and its decision will not be reversed absent a
manifest abuse of discretion. Orsini v. Larry Moyer
Trucking, Inc., 310 Ark. 179, 833 S.W.2d 366
(1992). As Mr. Clark obtained custody after the alleged acts of malpractice took place, we cannot
conclude that the trial court abused its discretion in
refusing to allow this testimony on relevancy
grounds. Thus, Mr. Callahan's argument is without
merit.
Affirmed.
Ark.,l995.
Callahan v. Clark
321 Ark. 376, 901 S.W.2d 842
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Westlaw,
810 So.2d 667
(Cite as: 810 So.2d 667)
Supreme Court of Alabama.
CITY OF BIRMINGHAM
v.
William Fred HORN et al.
William Fred Hom et al.
v.
City of Birmingham et al.
1991455 and 1991558.
Aug. 17, 2001.
City residents sought attorney fees in connection with their action against city, which resulted in
new ordinance regulating solid-waste facilities. The
Court of Civil Appeals, 648 So.2d 607 ,remanded
and later, 718 So.2d 691, affirmed denial of fees.
On grant of writ of certiorari, the Supreme Court,
718 So.2d 694, reversed and remanded. Following
denial of mandamus relief respecting award of interim attorney fees, 757 So.2d 389, the Circuit
Court, Jefferson County, No. CV-93-5013, William
A. Jackson, J., awarded residents attorney fees
totaling $1,785,939. City appealed, and residents
cross-appealed. The Supreme Court, Brown, J.,
held that: (1) law-of-the-case doctrine did not preclude trial court on remand from utilizing lodestar
method, rather than common fund method, for its
calculation of attorney fees; (2) hours that one attorney spent trying to convince another to assist
him with representation of residents would be deducted from lodestar calculation; (3) hourly rate of
award would be reduced from $175 to $150; (4)
lodestar multiplier of 2 was improper; and (5) statutes limiting city's liability for torts to no more than
$300,000 did not apply to attorney fee award.
1991455-Reversed and judgment rendered.
1991558-Affirmed.
See, J., issued specially concurring opinion.
Johnstone, J., issued opinion concurring in
Page 1
part, concurring in result in part, and dissenting in
part.
Houston, J., issued opinion concurring in part
and dissenting in part.
West Headnotes
[1] Appeal and Error 30 €= 1195(1)
30 Appeal and Error
30XVII Determination and Disposition of Cause
30XVII(F) Mandate and Proceedings in
Lower Court
30kll93 Effect in Lower Court of Decision of Appellate Court
Cited Cases
30kll95 As Law of the Case
30k1195(1) k. In General. Most
Law-of-the-case doctrine did not, on remand
from Supreme Court, preclude trial court from utilizing lodestar method, rather than common fund
method, for its calculation of attorney fees awarded
to city residents whose action against city resulted
in new ordinance regulating solid-waste facilities;
although Supreme Court held on prior appeal that
residents were entitled to award of attorney fees under special-equity exception to American rule,
Court was silent on question of method by which
fees were to calculated, and common-fund approach would be difficult to apply because case was
undertaken solely to effect societal change.
[2] Appeal and Error 30 €= 1195(1)
30 Appeal and Error
30XVII Determination and Disposition of Cause
30XVII(F) Mandate and Proceedings in
Lower Court
30kll93 Effect in Lower Court of Decision of Appellate Court
Cited Cases
30k1195 As Law of the Case
30kll95(1) k. In General. Most
On remand, the issues decided by an appellate
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
court become the "law of the case," and the trial
court's duty is to comply with the appellate court's
mandate according to its true intent and meaning, as
determined by the directions given by the reviewing
court.
[3] Costs 102 E? 194.16
102 Costs
102VIII Attorney Fees
102k194.16 k. American Rule; Necessity of
Contractual or Statutory Authorization or Grounds
in Equity. Most Cited Cases
Under the American rule, parties to a lawsuit
generally bear the responsibility of paying their
own attorney fees, subject to certain exceptions created by statute, contract, or "special equity."
[4] Costs 102 E? 194.16
102 Costs
102VIII Attorney Fees
102k194.16 k. American Rule; Necessity of
Contractual or Statutory Authorization or Grounds
in Equity. Most Cited Cases
The special-equity exception to the American
rule invokes principles common to an action seeking a recovery under the theory of quantum meruit,
in that it involves one party's seeking attorney fees
for engaging in efforts that benefited another party.
[5] Attorney and Client 45 E? 155
45 Attorney and Client
45IV Compensation
45k155 k. Allowance and Payment from
Funds in Court. Most Cited Cases
Costs 102 E? 194.42
102 Costs
102VIII Attorney Fees
102kl94.42 k. Public Interest and Substantial
Benefit Doctrine; Private Attorney General. Most
Cited Cases
Attorney fees may be awarded where the
plaintiffs efforts are successful in creating a fund
Page2
out of which the fees may be paid, or when the efforts of the plaintiff's attorneys render a public service or result in a benefit to the general public in
addition to serving the interests of the plaintiff.
[6] Attorney and Client 45 E? 155
45 Attorney and Client
45IV Compensation
45k155 k. Allowance and Payment from
Funds in Court. Most Cited Cases
Costs 102 E? 194.26
102 Costs
102VIII Attorney Fees
102k194.24 Particular Actions or Proceedings
102k194.26 k. Class Actions. Most Cited
Cases
There are currently two methods available for
the determination of fee awards for attorneys who
have litigated successfully on behalf of a class: (1)
the common-fund approach and (2) the lodestar approach.
[7] Costs 102 E? 194.26
102 Costs
102VIII Attorney Fees
102kl94.24 Particular Actions or Proceedings
102kl94.26 k. Class Actions. Most Cited
Cases
Under the lodestar approach for determining attorney fee awards for attorneys who have litigated
successfully on behalf of a class, the trial court
must determine the number of hours reasonably expended by counsel on the matter, and then multiply
those hours by an hourly rate of compensation set
by the court; the court may then adjust that figure
by using a multiplier determined by considering a
variety of factors, including the complexity of the
case and counsel's experience.
[8] Attorney and Client 45 E? 155
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
45 Attorney and Client
45IV Compensation
45kl55 k. Allowance and Payment from
Funds in Court. Most Cited Cases
Under the common-fund approach for determining attorney fee awards in favor of attorneys who
have litigated successfully on behalf of a class, the
trial court decides upon a percentage and then applies that figure to the fund obtained as a recovery.
[9] Attorney and Client 45 €= 155
45 Attorney and Client
45IV Compensation
45kl55 k. Allowance and Payment from
Funds in Court. Most Cited Cases
Although the existence of a separate fund is unnecessary to application of the common-fund approach when determining attorney fee awards for
attorneys who have litigated successfully on behalf
of a class, the common-fund approach has been employed only when there has been a defined monetary recovery.
[10] Costs 102 €= 194.18
102 Costs
102Vlll Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
The method used to calculate an attorney-fee
award in a particular case is not necessarily determined by which of the exceptions to the American
rule (i.e., statutory, contractual, or special equity)
justified that award.
[11] Costs 102 €= 194.42
102 Costs
102Vlll Attorney Fees·
102kl94.42 k. Public Interest and Substantial
Benefit Doctrine; Private Attorney General. Most
Cited Cases
Attorney fees awarded pursuant to the
"special-equity" common-benefit doctrine may, at
times, be computed using the lodestar method
Page3
where circumstances warrant.
[12] Appeal and Error 30 €= 1195(3)
30 Appeal and Error
30XVII Determination and Disposition of Cause
30XVII(F) Mandate and Proceedings in
Lower Court
30kll93 Effect in Lower Court of Decision of Appellate Court
30kll95 As Law of the Case
30kll95(3) k. To What Extent Applicable in General. Most Cited Cases
Supreme Court's statement in another case, describing its holding on prior appeal in instant case
as calling for attorney fee award under common
fund exception to American rule, did not, under
law-of-case doctrine, preclude trial court upon remand from utilizing lodestar method, rather than
common fund method, for its calculation of attorney fees; statement in question was not holding, but
mere description of holding in another case, and,
thus, it was not binding.
[13] Appeal and Error 30 €= 984(5)
30 Appeal and Error
30XVI Review
30XVI(H) Discretion of Lower Court
30k984 Costs and Allowances
30k984(5) k. Attorney Fees. Most
Cited Cases
Costs 102 €= 194.18
102 Costs
1 02Vlll Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
The determination of whether an attorney fee is
reasonable is within the sound discretion of the trial
court and will not be disturbed on appeal absent an
abuse of that discretion.
[14] Appeal and Error 30 €= 984(5)
30 Appeal and Error
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
30XVI Review
30XVI(H) Discretion of Lower Court
30k984 Costs and Allowances
30k984(5) k. Attorney Fees. Most
Cited Cases
Supreme Court's deference to the trial court in
attorney-fee cases is based upon the Court's recognition that the trial court, which has presided over
the entire litigation, has a superior understanding of
the factual questions that must be resolved in fee
determinations.
[15] Costs 102 €= 208
102 Costs
102IX Taxation
102k208 k. Duties and Proceedings of Taxing Officer. Most Cited Cases
The trial court's order regarding an attorney fee
must allow for meaningful review by articulating
the decisions made, the reasons supporting those
decisions, and the performance of the attorney-fee
calculation.
[16] Costs 102 €= 194.18
102 Costs
102VIII Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
The attorney-fee calculation under the lodestar
method involves several steps: first, the trial court
must determine the number of hours reasonably expended by counsel and a reasonable hourly rate of
compensation for counsel's representation; the number of reasonable hours is then multiplied by that
reasonable rate, yielding an initial estimate called
the "lodestar amount"; the lodestar amount is then
adjusted upward or downward depending on certain
factors attendant to, among other things, the nature
and difficulty of counsel's representation.
[17] Costs 102 €= 207
102 Costs
102IX Taxation
Page4
1 02k207 k. Evidence as to Items. Most Cited
Cases
Applicants for an attorney fee bear the burden
of proving their entitlement to an award and documenting their appropriately expended hours.
[18] Costs 102 €= 207
102 Costs
102IX Taxation
1 02k207 k. Evidence as to Items. Most Cited
Cases
Applicants for an attorney fee should exercise
"billing judgment" with respect to hours worked,
and should maintain billing time records in a manner that will enable a reviewing court to identify
distinct claims.
[19] Appeal and Error 30 €= 1024.1
30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and
Findings
30XVI(I)6 Questions of Fact on Motions
or Other Interlocutory or Special Proceedings
30kl 024.1 k. In General. Most Cited
Cases
Costs 102 €= 208
102 Costs
102IX Taxation
102k208 k. Duties and Proceedings of Taxing Officer. Most Cited Cases
With respect to an attorney fee award under the
lodestar approach, a trial court's general statement
that the number of hours spent was reasonable or
unreasonable is not very helpful and, accordingly,
should not be given much weight on appeal.
[20] Municipal Corporations 268 €= 1040
268 Municipal Corporations
268XVI Actions
268kl040 k. Costs. Most Cited Cases
Evidence on appeal from attorney fee award to
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
citizens' group in environmental litigation against
city supported finding that there was no redundant
billing with respect to work jointly performed by
plaintiffs' counsel in preparing briefs, court memoranda, and various responses to city's submissions;
while record disclosed billing statements that nebulously described general tasks but did not provide
sufficient detail, testimony presented during evidentiary hearing provided adequate elucidation supporting trial court's conclusion of reasonableness.
[21] Costs 102 E:= 194.18
102 Costs
102VIII Attorney Fees
102k194.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
Attorney fees for hours expended for fee litigation are compensable.
[22] Municipal Corporations 268 E:= 1040
268 Municipal Corporations
268XVI Actions
268kl 040 k. Costs. Most Cited Cases
Twenty-seven hours that first attorney spent
trying to convince second attorney to assist him
with representation of city residents in environmental litigation against city, which resulted in new
city ordinance regulating solid-waste facilities,
were not essential to that representation, and, thus,
those hours would be deducted from lodestar calculation when determining reasonableness of attorney
fee award to city residents.
[23] Municipal Corporations 268 E:= 1040
268 Municipal Corporations
268XVI Actions
268k1040 k. Costs. Most Cited Cases
Evidence did not support attorney fee award to
city residents at hourly rate of $175 in class action
that resulted in new city ordinance regulating solidwaste facilities, and, thus, award would be reduced
to $150 per hour; while trial court stated that it was
"familiar with the hourly market rate in the area,"
PageS
there was no evidence in record regarding area's
market rate, counsel typically charged clients somewhere between $80 and $150 per hour, and even
though complexity of case generally supported
higher rate, record was replete with testimony indicating that counsel were unfamiliar with applicable law.
[24] Municipal Corporations 268 E:= 1040
268 Municipal Corporations
268XVI Actions
268kl040 k. Costs. Most Cited Cases
Lodestar multiplier of 2 was improper when
calculating attorney fees awarded to city residents
whose action against city resulted in new ordinance
regulating solid-waste facilities, and, thus, attorney
fee award of $1,785,939 was excessive; because
substantial portion of counsel's hours were expended pursuing fee litigation rather than litigation that
provided substantive benefits of original case, multiplier of 1.5 would be applied to those hours expended by plaintiffs' counsel in winning enactment
of ordinance, and no multiplier would be applied to
work on matters not essential to that purpose, resulting in fee award of$1,020,290.50.
[25] Municipal Corporations 268 E:= 1040
268 Municipal Corporations
268XVI Actions
268k1040 k. Costs. Most Cited Cases
Statutes limiting city's liability for torts to no
more than $300,000 did not apply to attorney fee
award exceeding that amount. Code 1975, §§
11-47-190, 11-93-2.
*670 Joe R. Whatley, Jr., and Peter H. Burke of
Whatley Drake, L.L.C., Birmingham; Kenneth L.
Thomas and Valerie L. Acoff of Thomas, Means &
Gillis, Birmingham; and Tamara Harris Johnson
and Michael Melton, city attys., for appellant/cross
appellee City of Birmingham.
W.L. Williams, Jr., Birmingham; and David A. Sullivan, Birmingham, for appellees/cross appellants
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
William Fred Hom et al.
Kenneth Smith, director of legal services, and Erin
Smith, assoc. gen. counsel, Alabama League of
Municipalities for amicus curiae Alabama League
of Municipalities.
BROWN, Justice.
The question presented in these appeals, collectively stated, is whether the Jefferson Circuit
Court erred by holding that a group of citizens
(sometimes referred to herein as "the plaintiffs")
who sued the City of Birmingham ("the City") are
entitled to an award of attorney fees totaling
$1,785,939, an amount computed by the so-called
"lodestar method." The court awarded these fees to
the plaintiffs for their role in litigation involving
the placement of a waste transfer station and recycling center in a Birmingham neighborhood by
Browning Ferris Industries of Alabama, Inc.
("BFI"). See generally Horn v. City of Birmingham,
648 So.2d 607 (Ala.Civ.App.l994) ( "Horn I ");
Horn v. City of Birmingham, 718 So.2d 691
{Ala.Civ.App.l997) ("Horn II"); and Battle v. City
of Birmingham, 656 So.2d 344 (Ala.l995). The
City appeals, contending that the trial court, in
awarding attorney *671 fees, incorrectly applied the
method it used to compute the fees; the plaintiffs
cross-appeal from the order awarding attorney fees,
contending that the trial court used an inappropriate
method to compute the fees. As to the City's appeal,
we reverse the judgment of the trial court and
render a judgment; as to the plaintiffs' cross-appeal,
we affirm.
I. Facts and Procedural History
To facilitate an understanding of this complex
case and the stakes involved, we set out its factual
background, in pertinent part, as it was previously
presented by this Court in Ex parte Horn, 718
So.2d 694 {Ala.l998):
"Browning Ferris Industries of Alabama, Inc.
('BFI'), operates landfills for sanitary waste
(hereinafter sometimes referred to as 'garbage')
Page6
in Blount and Walker Counties that are permitted
to accept such waste from certain other Alabama
counties, including Jefferson County. In 1991,
BFI sought to construct a sanitary waste transfer
station and recycling center in the City of Birmingham ('the City'). The sanitary waste transfer
station was to be a facility where the many BFI
trucks collecting garbage from areas of the City
would come and dump their loads of garbage inside a large building; the garbage would then be
processed by separating recyclable waste from
nonrecyclable waste. The nonrecyclable waste
would later be transferred to much larger trucks
for transport to distant landfills, and the recyclable waste would be stored on-site for eventual
sale.
"In January 1991, an attorney representing BFI
wrote a letter to Tom Magee, chief planner in the
City's Department of Urban Planning, inquiring
whether BFI's proposed sanitary waste transfer
station and recycling center would require a
'special use' zoning permit. The BFI letter stated,
in relevant part:
" 'It is BFI's intention to purchase property
near the University of Alabama [at] Birmingham. The facility that they wish to locate there
is called a Transfer and Recycling Facility. The
purpose of the operation is this:
" 'BFI trucks will deliver garbage and recyclable materials to the facility. A machine will
then separate the garbage from the recyclable
materials. All the recyclable materials will be
placed in the facility and sold to the market as
BFI chooses, and all the garbage will be compressed by a machine and then placed on 70 ton
trucks. After this process is completed the 70
ton trucks will deliver the compressed garbage
to landfill sites in Blount and Walker Counties.
" 'As you know, the zoning ordinance under
the special exception criteria, authorize[ s] a
landfill in an M2 ["heavy industrial"] district
with a special use permit. My question to you
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
is whether a facility, such as the one described
above, is deemed to be a landfill by the City of
Birmingham.'
"The City's use regulations for a district zoned
M-2, heavy industrial, state:
" 'A building or premises shall be used only for
the following purposes:
" '1. Any use permitted in the M-1 Light Industrial District; except, that no dwelling
other than that for a resident watchman, custodian or caretaker employed on the premises
shall be permitted.
" '2. Any other use not in conflict with the
ordinances of the City of Birmingham regulating nuisances; provided further that no
building or occupancy permit shall be issued
for any of the following uses until and unless
the location of such use shall *672 have been
approved by the City Council after report by
the Planning Commission in accordance with
the procedure set forth in Article V, Section
3:
" 'a. Abattoir.
" 'b. Acid manufacture.
" 'c. Atomic power plant or reactor.
" 'd. Explosives manufacture or storage.
" 'e. Fat, grease, lard or tallow rendering or
refining.
"'f. Glue or size manufacture.
" 'g. Garbage, offal or dead animal reduction
or dumping.
" 'h. Petroleum refining.
" 'i. Stockyard or slaughter of animals.
" 'j. Junkyards, salvage yards.
Page7
" 'k. Hazardous waste or toxic disposal.
" '1. Medical and infectious materials disposed.'
"[Emphasis added in Ex parte Hom omitted
here.] The City's M-1 use regulation allows,
among other things, 'Manufacturing, fabricating,
processing, or assembling uses which do not create an objectionable noise, vibration, smoke,
dust, odor, heat or glare.' (Emphasis added [in Ex
parte Hom].)
"Later that same month, Magee wrote a response to BFI, stating that it was his opinion that
BFI did not need to obtain a special use permit to
construct a sanitary waste transfer and recycling
facility in an M-2 district:
" 'This letter is in response to your recent
correspondence regarding Browning Ferris Industries' (BFI) intent to purchase property on
the Southside of Birmingham for the purpose
of constructing a Transfer and Recycling Facility. As per your letter, BFI trucks will deliver
garbage and recyclable materials to this proposed facility, where the garbage and recyclable materials will be separated. All garbage
will then be compressed and placed in 22[ sic]
ton trucks which will haul the garbage to landfills in Blount and Walker Counties. It is my
understanding that the garbage will be processed daily and will not remain on the
premises overnight. Your letter also indicated
that the recyclable materials will be stored in a
separate area and will be sold to the market as
needed. It is also my understanding that this
entire process of transferring, processing, and
recycling of garbage will be completely enclosed within a building, and no hazardous
wastes or toxic materials will be processed or
stored on the premises. Based on this understanding, this use would not be interpreted to
be a sanitary landfill. In addition, the property
you have indicated as being utilized for this
proposed facility is located north of 6th A ven-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
ue, South near the Golden Flake Company and
is zoned M-2 (Heavy Industrial District). This
Zoning district would allow this facility as a
permitted use. Please be advised, however, that
no noxious odors, fumes, or noise can be associated with this facility.'
"[Emphasis added in Ex parte Hom omitted
here.] At the time Magee wrote this letter, the
only knowledge or information he had regarding
sanitary waste transfer stations was that presented
in BFI's letter to him and in a videotape he had
also received from BFI. Magee failed to conduct
any further inquiry before providing BFI with his
response approving construction of the facility in
that M-2 district.
*673 "Thereafter, BFI obtained an option from
the Golden Flake Company to purchase 10 acres
of a 30-acre tract owned by Golden Flake, and
BFI submitted for Golden Flake an application
with the City to subdivide the property. In March
1992, BFI gave property owners immediately adjacent to the Golden Flake property notice of the
intended subdivision of the property for development by BFI as a sanitary waste transfer and recycling station and the City approved subdivision
of the property. BFI purchased the subdivided
property from Golden Flake in March 1993 and
in April BFI announced in a press release that it
had obtained all the permits and approvals required by the City for it to construct a garbage
transfer station in the Titusville area of Birmingham.
"The residents of the primarily AfricanAmerican Titusville neighborhood first learned of
the BFI sanitary waste transfer station through
the press release. They objected to the facility's
being built adjacent to their neighborhood, and
several residents obtained the assistance of attorneys W.L. Williams, Jr., and David A. Sullivan
[plaintiffs' counsel in the present appeal]. These
Titusville residents and their legal counsel attended the May 11, 1993, meeting of the Birmingham City Council and voiced to the council memPage 8
hers their objections to the proposed BFI facility.
Council members responded by saying that they
had not previously been aware of the pending
BFI facility and that they did not believe they
could do anything to prevent the completion of
its construction. A larger group of Titusville residents, along with residents of Walker County, attended the May 25, 1993, meeting of the city
council. During that meeting, the Titusville residents and their counsel voiced continued opposition to the BFI sanitary waste transfer station. Attorney Williams stated that he believed that under
the City's M-2 zoning classification a facility
such as the one BFI planned to construct required
approval by the city. council, and he requested
that the Department of Urban Planning review
the zoning ordinance again. Michael Dobbins,
who was director of the Department of Urban
Planning and was Magee's supervisor, stated that
he believed council approval was not necessary,
because he believed the BFI sanitary waste transfer station conformed with the M-2 heavy industrial zoning classification. Dobbins admitted that
he had not visited a BFI sanitary waste transfer
facility, but stated that if the proposed BFI facility involved the creation of noxious odors, fumes,
and/or noise then it would violate the City's nuisance ordinances. Mayor Richard Arrington made
a report to the council and informed it that he believed he had no legal basis to deny any further
permits to BFI. However, the city council passed
a resolution asking the mayor to have the City do
whatever was legally possible to prevent BFI
from operating a sanitary waste transfer station at
the site in question. The following day the City's
attorney issued a memorandum to the city council
stating that he believed the City could face a
multi-million dollar lawsuit if it prevented BFI
from completing construction of the sanitary
waste transfer station.
"Thereafter, Dobbins wrote a letter to Williams, one of the attorneys for the Titusville residents. Dobbins stated that it was his position that
BFI's proposed facility was not a garbage dump
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
and that BFI was not required to receive any further zoning approvals before construction of the
facility. It is apparent from Dobbins's letter that
he was taking as fact BFI's contention that *674
the garbage transfer station would not create any
noise, noxious odors, or fumes that would prevent it from conforming with the M-2 use regulations and thus would not require city council approval. Dobbins stated in his letter to Williams
that garbage transfer stations were a new method
for handling household wastes and that the
nearest one was being operated by BFI in Marietta, Georgia, where it was adjacent to a residential neighborhood. However, there is no indication in the record that Dobbins or any of his staff
had visited the Marietta garbage transfer station,
or any other operated by BFI, in order to ascertain whether such facilities created noise, noxious
odors, or fumes, or in any other way would constitute a nuisance. Also in May 1993, Mayor Arrington wrote to the city council, stating that after
consulting with the City's Law Department and
the Department of Urban Planning, he was of the
opinion that construction permits could not be
legally withheld from BFI.
"In early June 1993, the Titusville residents appealed Dobbins's decision-that the proposed BFI
garbage transfer station did not require approval
by the city council in order to be constructed in
an area zoned M-2-to the City's Board of Zoning
Adjustment ('the Board'). The construction of the
BFI facility adjacent to a residential neighborhood, and the protest of the Titusville residents,
had begun to attract substantial attention from the
local news media, and at the June 8, 1993, meeting of the city council, one of the council members responded by sponsoring a proposed ordinance that would regulate sanitary waste transfer
facilities and would require public notice and
public hearings, as well as city council approval,
before construction. The ordinance was adopted
by the council at the same meeting and was approved by the mayor the following day; however,
public notice requirements for approval of the orPage9
dinance had not been met and it had to be passed
again at a later date, as mentioned below.
"The Titusville residents and their counsel,
along with numerous supporters, appeared before
the Board of Zoning Adjustment on June 10,
1993, to support their appeal; however, the Board
upheld Dobbins's decision. Thereafter, on June
24, William Fred Hom and other citizens filed in
the Jefferson Circuit Court a 'Notice of Appeal of
the Decision of the Zoning Board of Adjustment
of the City of Birmingham and Complaint for Declaratory Judgment, Petition for Writ of Mandamus and Permanent Injunctive Relief against the
Board, the City, and the mayor ('the Hom lawsuit'). The Hom filing alleged that Dobbins, as
the director of the Department of Urban Planning,
was the only person lawfully authorized to administer the City's zoning ordinances and, therefore, that a lesser employee such as Magee was
without lawful authority to render an interpretation of the M-2 zoning ordinance when he did so
in his January 1991 letter to BFI. The filing further alleged that the construction permits the City
had issued to BFI, based on Magee's decision and
without city council approval, were unlawful. It
requested that the court order the City not to issue any further permits to BFI regarding the facility under construction until its use was approved by the city council. In July 1993, 63 persons from different cities and counties in
Alabama moved to intervene as plaintiffs in the
Hom lawsuit. BFI also moved to intervene in the
action as a defendant.
"In response to extensive and continuing public
pressure and media coverage *675 brought by the
plaintiffs' litigation against the City, the city
council, on August 3, 1993, passed a resolution
authorizing the mayor to enter into negotiations
with BFI to either purchase the subject property
from BFI or to exchange it for other property
owned by the City. The mayor and a council
member met with representatives of BFI to discuss a purchase of the property by the City, but
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
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no agreement was reached and BFI continued
construction of the facility.
"On August 27, the plaintiffs filed a motion
seeking to compel the City and the mayor to be
realigned from defendants to plaintiffs. Negotiations between the City and BFI continued, but
failed when the City could not meet BFI's requested price for the facility, $17 million. On September 3, the mayor filed a motion with the circuit
court requesting that he be realigned from a party
defendant to a party plaintiff, which was granted
by the circuit court. That motion stated:
" 'Now comes Mayor Richard Arrington, Jr.
in his official capacity as Mayor of the City of
Birmingham, Alabama, and moves this Honorable Court to realign this defendant as a
plaintiff as further described herein. This defendant asserts that new information has been
developed during the course of this action. This
new information is as follows:
" '1. Contrary to earlier representations, a
portion of the garbage collected by Browning-Ferris Industries of Alabama, Inc., will
remain on the site more than a few hours.
This consists of items salvaged for recycling
and of liquid and semi-solid contaminants
leaking from the garbage.
" '2. Contrary to earlier representations, this
facility, if operated as other similar facilities,
cannot be sanitized. Reports from Marietta,
Georgia suggested that, with 24 hour operation, full, daily cleaning is either not possible
or not effective in eliminating odor.
" '3. It has been reported to me that it is not
possible to eliminate possible contaminated
liquid drainage on streets and into storm sewers, leading to the facility. This is a special
concern since the primary path to the BFI facility is adjacent to a city park and swimming
pool.
Page 10
" '4. Together with the additional information now available, as described herein, in
my opinion, this garbage transfer facility
does constitute a necessary incident to a
garbage dump thereby incurring the requirement that the location of such use be approved by the City Council.
" '5. As a further necessary precondition to
the operation of this facility, it is my opinion
that the Alabama Department of Environmental Management must review and approve this facility as a necessary incident to a
garbage dump. Any such review or approval
is unknown to me.
" 'Based upon these facts, I as Mayor, request to be realigned as a plaintiff for the
limited purpose of asserting that, based on
new information not previously furnished to,
or incorrectly furnished to, Mr. Thomas
Magee, Mr. Mike Dobbins, and the Zoning
Board of Adjustment, this matter must, in accordance with Article III, Section 3.2 of the
Zoning Code of the City of Birmingham, be
referred to the Birmingham *676 Planning
Commission and City Council, and further,
that this proposed use, for reasons cited
above, will, in my opinion, necessarily constitute a nuisance in violation of Section
11-8-1 of the General Code of the City of
Birmingham, 1980, in that this use is likely
to be prejudicial to the comfort of and offensive to the senses of the ordinary citizens
of the City of Birmingham.'
"[Emphasis added in Ex parte Hom omitted
here.]
"On September 7, the city council adopted a
resolution authorizing the mayor to obtain an appraisal of the BFI property for the purpose of
condemning the property. The council also authorized the creation of a committee to investigate the BFI project. BFI responded by suing the
City, Mayor Arrington, the city council, and its
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members, for declaratory and injunctive relief,
and for $17 million in damages ('the BFI lawsuit'). In its complaint, BFI alleged that City officials, unfairly exercising political expediency,
had illegally conspired to formulate a plan to
'kill' its previously approved project.
"On September 10, the City made an offer of
judgment, per Rule 68, Ala. R. Civ. P., consenting to the entry of a judgment against it and in favor of the plaintiffs in the Horn lawsuit that
would require that the matter of BFI's construction permits be returned to the city council for
further consideration, requiring council approval
before the facility could begin operating. The
plaintiffs accepted the offer of judgment. On
September 13, 1993, Judge William A. Jackson,
of the Jefferson Circuit Court, entered a fmal order in the Horn lawsuit, pursuant to the offer of
judgment, requiring that the City refuse to issue
construction permits to BFI until the sanitary
waste transfer facility obtained the approval of
the city council, after public notice and a public
hearing. The court ordered that each party bear its
own costs. Two days later, the plaintiffs filed a
Rule 59, Ala. R. Civ. P., motion with the circuit
court, asking the court to alter or ame~d the judgment so as to award them an attorney fee from
the City. The trial court denied the motion and
the plaintiffs appealed to the Court of Civil Appeals; that court eventually affirmed the trial
court's ruling ....
"On September 14, the city council adopted an
amended version of the solid waste facilities ordinance it had previously adopted in June. That
extensive ordinance, governing the permitting
and licensing of all commercial solid waste facilities in the City, now appears as § 4-3-31 et seq.,
General Code of the City of Birmingham ....
"On September 17, the City's attorney wrote
BFI a letter in which he invited BFI to petition
the City for a special use zoning permit from the
Board of Zoning Adjustment, as required by the
trial court's judgment in the Horn lawsuit.
Page II
However, BFI never did so. Instead, BFI attempted to use its own lawsuit against the City to gain
approval to operate its garbage transfer station.
The City responded to BFI's complaint against it
by asserting the Horn lawsuit consent judgment
in support of a collateral estoppel and res judicata defense.
"On January 13, 1994, Whitlynn Battle, one of
the Titusville plaintiffs, moved to intervene in the
BFI lawsuit against the City, as a party defendant. Battle sought to protect the judgment she and
the other plaintiffs had obtained in the Horn lawsuit. The City, BFI, and Battle entered into mediation, and the BFI lawsuit was eventually settled,
with a consent judgment entered in February
*677 1994; by that settlement BFI was to sell,
and the City was to purchase, BFI's property for
$6,750,000. Battle, seeking to prevent the City
from having to purchase the property from BFI,
challenged the judgment by way of a Rule 59,
Ala. R. Civ. P., motion and also sought an award
of attorney fees in relation to the BFI lawsuit.
The trial court denied the motions, and its ruling
was eventually upheld on appeal. Battle, supra.
"The success of the Horn plaintiffs in preventing the operation of BFI's sanitary waste transfer
station, and the City's purchase of the BFI property, [were] brought to statewide and even international attention. According to the plaintiffs, a
Birmingham daily newspaper, the Birmingham
News, published more than 90 articles concerning
the plaintiffs' fight against the proposed BFI
garbage transfer facility, and one Birmingham
television station aired approximately 100 stories
on that topic. The case was the focus of discussion on the Alabama Public Television Network's
news program 'For the Record' on November 28,
1995, and the international organization Greenpeace produced a video on the struggle of the
Horn plaintiffs entitled, 'Not in Anyone's Backyard-the Grassroots Victory over Browning-Ferris Industries.' On the episode of 'For the
[Record],' Rick Losa, a BFI representative, stated
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that because of the Horn litigation involving its
attempt to operate a garbage transfer station in
Titusville, BFI had changed its procedures for
locating and constructing such a facility so that in
the future public concerns about a proposed location would be considered from the start. The
Horn lawsuit was also the topic of one of the 11
chapters in the 1995 academic text 'Faces of Environmental Racism' by Dr. Laura Westra and
Dr. Peter W enz, in which those authors concluded that BFI's attempt to locate its garbage
transfer facility in the primarily African-American Titusville neighborhood was a clear case of
environmental racism."
Ex parte Horn, 718 So.2d at 695-701
(footnotes omitted).
The Horn plaintiffs appealed the trial court's
order denying their motion for an award of attorney
fees to the Court of Civil Appeals. That court, in
Horn v. City of Birmingham, 648 So.2d 607
(Ala.Civ.App.l994), stated that it appeared the trial
court's ruling had been based on "an apparent belief
that a common fund had to exist in order for it to
award attorney fees." Horn I, 648 So.2d at 609. The
court then held that "the mere fact that the
plaintiffs' action did not create a fund from which a
fee could be paid should not bar the trial court from
awarding attorney fees," and it remanded the case
for the trial court to determine "whether the efforts
of the plaintiffs' attorneys produced a common benefit [to the general public] and to consider the
award of attorney fees." !d. at 610.
The trial court, on remand, determined that
there was no common benefit to the general public
and again denied the plaintiffs' motion for attorney
fees. On return from remand, the Court of Civil Appeals affirmed. Horn v. City of Birmingham, 718
So.2d 691, 694 (Ala.Civ.App.l997). This Court
then granted certiorari review to consider "whether
the Court of Civil Appeals erred in affirming the
trial court's ruling that the plaintiffs are not due an
award of attorney fees under the 'common benefit'
exception to the 'American Rule.' "Ex parte Horn,
Page 12
718 So.2d 694, 695 (Ala.l998) (sometimes referred
to herein as "Horn III "). We reversed the judgment
of the Court of Civil Appeals, holding that the
plaintiffs were entitled to attorney fees *678 because they had conferred a substantial benefit upon
the residents of Birmingham, including those residents living outside the plaintiffs' own neighborhood. Horn IlL 718 So.2d at 706. In so holding, we
reasoned that the benefit conferred included "a new
[city] ordinance specifically regulating and licensing solid waste facilities, such as the garbage transfer station at issue ... [and] an increased level of due
process protection to all residents of Birmingham."
!d. Consequently, the case eventually returned to
the Jefferson Circuit Court for further proceedings.
In those proceedings, both parties initiated discovery relating to the question of attorney fees.
While discovery continued, the plaintiffs filed a
motion with the trial court seeking, among other
things, interim attorney fees. The trial court granted
the motion and eventually awarded the plaintiffs a
$250,000 interim fee, prompting the City to petition
this Court for a writ of mandamus. See Ex parte
City of Birmingham, 757 So.2d 389 (Ala.l999). In
that petition, the City requested that this Court (1)
direct the trial court to vacate its order awarding the
plaintiffs the $250,000 interim attorney fee and (2)
overrule Horn IlL supra. We denied the petition
and held that the trial court did not abuse its discretion in awarding the interim attorney fee. Ex parte
City of Birmingham, 757 So.2d at 392. We also refused to overrule our prior decision holding that attorney fees should be awarded in the case; we
stated:
"The City requests further that we overturn our
decision in Ex parte Horn, .. . in which we held
that the residents are entitled to an attorney fee
under the 'common-fund' exception. However,
we decline to do so."
/d.
In December 1998, the trial court conducted a
bench trial on the issue of determining an award of
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attorney fees. The court heard from numerous witnesses, including the support staff for the plaintiffs'
counsel; expert witnesses; the Honorable Richard
Arrington, Jr. (who was mayor of Birmingham during the time in question); and plaintiff and defense
counsel. The court received into evidence billing
records; time sheets; invoices; expense reports; examples of work product; newspaper articles concerning the case; correspondence; and documents
concerning the qualifications and professional
achievements of plaintiffs' counsel.
After considering this evidence, the trial court
issued an order on March 2, 2000, stating its findings and conclusions. In that order, the court deducted 84 hours from plaintiffs' counsel's billable-hour
submission, fmding those hours redundant or unnecessary; this yielded a total of 5,326 compensable
hours. The court then considered and added hours
claimed in the plaintiffs' counsel's supplemental
submission, which raised the total compensable
hours to 5,816.95. The court also determined a market rate of $175 per hour of work done, a figure it
based on its considering evidence of rates charged
in the area for similar work by attorneys with similar experience. Further, the court determined that the
plaintiffs were entitled to a multiplier of 2, which,
the court said, reflected the difficulty of the case
and the fact that the plaintiffs had prevailed under
arduous circumstances. The final attorney-fee
award was $1,785,939, which reflected a deduction
of $250,000 for the previously awarded interim attorney fees.
Neither side was content with this award. The
plaintiffs moved the trial court to alter, amend, or
vacate its judgment, contending that the court had
erred by using the lodestar method in calculating
*679 the fees. After the trial court denied the
plaintiffs' motion, both sides appealed.
Resolution of the general issue in this case, as
we stated it above, requires us to answer three questions: ( 1) Was the trial court correct in using the
lodestar method for its calculation of attorney fees?
(2) Did the trial court correctly determine that the
Page 13
plaintiffs were entitled to attorney fees totaling
$1,785,939 and that those fees were necessary and
reasonable? and (3) Does § 11-93-2, Ala.Code 1975
, limit the City's obligation to pay attorney fees exceeding $300,000?
II.
[ 1] The first question we consider is whether
the trial court used the correct method for its calculation of attorney fees. The plaintiffs contend that
under the law-of-the-case doctrine, the trial court
should have used the "percentage method," which,
the plaintiffs argue, would have been in accordance
with our holding in Horn Ill.
[2] In Gray v. Reynolds, 553 So.2d 79
(Ala.l989), we summarized the law-of-the-case
doctrine:
"It is well established that on remand the issues
decided by an appellate court become the 'law of
the case,' and that the trial court must comply
with the appellate court's mandate. Walker v.
Carolina Mills Lumber Co., 441 So.2d 980
(Ala.Civ.App.l983). See also Erbe v. Eady, 447
So.2d 778 (Ala.Civ.App.l984). The trial court's
duty is to comply with the mandate 'according to
its true intent and meaning,' as determined by the
directions given by the reviewing court. Ex parte
Alabama Power Co., 431 So.2d 151 (Ala.l983)."
553 So.2d at 81. The application of this doctrine here rests upon a construction of our holding
in Horn IlL for only those statements of law directly pertaining to the issues decided in Horn III
can bind subsequent proceedings in this case. See
Gray, 553 So.2d at 81.
[3] The plaintiffs contend that Horn III is dispositive of the question regarding the appropriate
method to be employed in calculating the award of
attorney fees in this case. In Horn IlL the issue before us was whether the plaintiffs were entitled to
attorney fees. 718 So.2d at 695. We observed that,
under the American rule, parties to a lawsuit generally bear the responsibility of paying their own at-
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torney fees, subject to certain exceptions created by
statute, contract, or "special equity." Id. at 702. We
then held that the special-equity exception applied
to this case. Id.
[4][5] The special-equity exception invokes
principles common to an action seeking a recovery
under the theory of quantum meruit, in that it involves one party's seeking compensation for engaging in efforts that benefited another party. Silberman v. Bogle, 683 F.2d 62, 64 (3d Cir.l982)
(quoting Lindy Bros. Builders v. American Radiator
& Standard Sanitary Corp., 487 F.2d 161, 165 (3d
Cir.l973)). We acknowledged those principles in
Horn IlL where we stated:
" [A ]ttorney fees may be awarded where the
plaintiffs efforts are successful in creating a fund
out of which the fees may be paid, or when the
efforts of the plaintiffs attorneys render a public
service or result in a benefit to the general public
in addition to serving the interests of the
plaintiff."
718 So.2d at 702; see also City of Ozark v.
Trawick, 604 So.2d 360, 364 (Ala.l992); Brown v.
State, 565 So.2d 585, 591 (Ala.l990); and Bell v.
Birmingham News Co., 576 So.2d 669, 670
(Ala.Civ.App.l991). In Horn IlL we found that the
plaintiffs' efforts had principally resulted in a new
City ordinance regulating solid-waste facilities; this
fact, we said, resulted in an *680 increase in dueprocess protection for all residents of Birmingham.
Horn IlL 718 So.2d at 706. We then held that the
plaintiffs were entitled to an award of attorney fees
under the special-equity exception. !d. The
plaintiffs, noting that this exception is premised
upon the common-benefit doctrine, argue in their
brief that our holding in Horn III issued an implied
mandate to the trial court to employ the so-called
"common-fund" approach in calculating the award
of attorney fees in this case. We disagree.
[6][7][8][9] Under Alabama law, there are currently two methods available for the determination
of fee awards for attorneys who have litigated suePage 14
cessfully on behalf of a class: (1) the common-fund
approach and (2) the lodestar approach. See Union
Fid. Life Ins. Co. v. McCurdy, 781 So.2d 186,
189-90 (Ala.2000) (discussing the discretion of the
trial court in determining which approach is appropriate in any given case). Under the lodestar approach, the trial court must determine the number
of hours reasonably expended by counsel on the
matter, and then multiply those hours by an hourly
rate of compensation set by the court. Union Fid.,
781 So.2d at 191-92. The court may then adjust that
figure by using a multiplier determined by considering a variety of factors, including the complexity
of the case and counsel's experience. Id. Under the
common-fund approach, the trial court decides
upon a percentage and then applies that figure to
the fund obtained as a recovery. Although we have
held that the existence of a separate fund is minecessary, Union Fid., 781 So.2d at 190, we have employed the common-fund approach only when there
has been a defmed monetary recovery. See Edelman
& Combs v. Law, 663 So.2d 957, 961 (Ala.l995);
Ex parte Brown, 562 So.2d 485, 496 (Ala.l990);
Reynolds v. First Alabama Bank of Montgomery,
NA, 471 So.2d 1238, 1245 (Ala.l985); and Eagerton v. Williams, 433 So.2d 436, 450-51 (Ala.l983);
cf Union Fid., 781 So.2d at 189-90 (stating that recovery under the common-fund approach is possible when the defendant has admitted to being liable for a sum certain in damages even though no
separate fund, such as an escrow account, has been
created).
The common-fund approach becomes unworkable when the recovery does not involve a quantifiable monetary settlement or damages award. This is
often the case where, as here, the litigation has been
undertaken solely to effect a societal change. Generally, such a case involves the declaration or enforcement of rights where a statute authorizing the
lawsuit has likewise authorized the award of attorney fees. See Court Awarded Attorney Fees, Report
of the Third Circuit Task Force, 108 F.R.D. 237,
255 (1985). Because of the intangible nature of the
relief granted, courts have steadfastly employed the
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lodestar method to calculate attorney fees in such
cases. The United States Court of Appeals for the
Third Circuit, in In re General Motors Corp. PickUp Truck Fuel Tank Products Liability Litigation,
55 F.3d 768 (3d Cir.l995), explained the judicial
loyalty to the lodestar method in this kind of case:
"The lodestar and the percentage of recovery
methods each have distinct attributes suiting
them to particular types of cases. Ordinarily, a
court making or approving a fee award should determine what sort of action the court is adjudicating and then primarily rely on the corresponding
method of awarding fees (though there is, as we
have noted, an advantage to using the alternative
method to double check the fee).
"Courts generally regard the lodestar method,
which uses the number of hours reasonably expended as its starting point, as the appropriate
method in statutory*681 fee shifting cases. Because the lodestar award is de-coupled from the
class recovery, the lodestar assures counsel undertaking socially beneficial litigation (as legislatively identified by the statutory fee shifting
provision) an adequate fee irrespective of the
monetary value of the final relief achieved for the
class.
"This de-coupling has the added benefit of
avoiding subjective evaluations of the monetary
worth of the intangible rights often litigated in
civil rights actions. Outside the pure statutory fee
case, the lodestar rationale has appeal where as
here, the nature of the settlement evades the precise evaluation needed for the percentage of recovery method."
55 F.3d at 821 (citation omitted). With regard
to cases (like the present one) where the right to an
attorney fee is nonstatutory and the relief involves
intangible remedies, the Court of Appeals in General Motors opined:
"Certainly, the court may select the lodestar
method in some non-statutory fee cases where it
can calculate the relevant parameters (hours exPage 15
pended and hourly rate) more easily than it can
determine a suitable percentage to award."
!d.
[10][11][12] The Third Circuit's reasoning in
General Motors illustrates the principle that the
method used to calculate an attorney-fee award in a
particular case is not necessarily determined by
which of the exceptions (i.e., statutory, contractual,
or special equity) justified that award. Consequently, attorney fees awarded pursuant to the
"special-equity" common-benefit doctrine may, at
times, be computed using the lodestar method
where circumstances warrant. See Charles v. Goodyear Tire & Rubber Co., 976 F.Supp. 321, 325
(D.N.J.l997) (applying the lodestar method after
noting the difficulty in valuing a settlement that included equitable relief); and Cooperstock v. Pennwalt Corp., 820 F.Supp. 921, 926 (E.D.Pa.l993)
(applying the lodestar method after finding that the
benefit conferred upon the class plaintiffs was
"unquantifiable"). In Horn III, this Court determined that the plaintiffs were entitled to attorney
fees, but, by its silence on the question of method,
left open the method by which those fees were to be
calculated. Therefore, we hold that the trial court
did not violate the law of the case established m
Horn III by employing the lodestar method. FNl
FNl. In Ex parte City of Birmingham,
supra, where the City petitioned for a writ
of mandamus, we characterized the City's
argument in the following manner:
"The City requests further that we overtum our decision in Ex parte Horn,
supra, in which we held that the residents are entitled to an attorney fee under
the 'common-fund' exception."
Ex parte City of Birmingham, 757 So.2d
at 392 (emphasis added). The plaintiffs
contend-in addition to their arguments
stated above-that this restatement of our
holding in Horn III was, itself, a hold-
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ing. That restatement, however, merely
described a holding in Horn III, which
was another case, and did not directly
pertain to our resolution of the issues
presented in City of Birmingham. Therefore, we are not bound by that statement
in the present case, under the lawof-the-case doctrine. See Gray v. Reynolds, 553 So.2d 79, 81 (Ala.l989)
(stating that the Court was not bound by
dicta appearing in an opinion in a prior
appeal).
III.
[ 13 ][ 14 ][ 15] We now turn to the question regarding the amount of attorney fees awarded. "The
determination of whether an attorney fee is reasonable is within the sound discretion of the trial court
and will not be disturbed on appeal absent an abuse
of that discretion." Ex parte Edwards, 601 So.2d
82, 85 {Ala.1992). Our *682 deference to the trial
court in attorney-fee cases is based upon our recognition that the trial court, which has presided over
the entire litigation, has a superior understanding of
the factual questions that must be resolved in fee
determinations. See Hensley v. Eckerhart, 461 U.S.
424, 437, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983).
Nevertheless, the trial court's order regarding an attorney fee must allow for meaningful review by articulating the decisions made, the reasons supporting those decisions, and the performance of the attorney-fee calculation. American Civil Liberties
Union of Ga. v. Barnes, 168 F.3d 423, 427 (11th
Cir.1999); see also Hensley, 461 U.S. at 437, 103
S.Ct. 1933.
[16] The attorney-fee calculation under the
lodestar method involves several steps. First, the
trial court must determine the number of hours
reasonably expended by counsel and a reasonable
hourly rate of compensation for counsel's representation. The number of reasonable hours is then multiplied by that reasonable rate, yielding an initial estimate called the "lodestar amount." Edwards, 601
So.2d at 85. The lodestar amount is then adjusted
Page 16
upward or downward depending on certain factors
attendant to, among other things, the nature and difficulty of counsel's representation. See id. (quoting
Pennsylvania v. Delaware Valley Citizens' Council
for Clean Air, 478 U.S. 546, 564, 106 S.Ct. 3088,
92 L.Ed.2d 439 (1986)); see also Brown v. State,
565 So.2d 585, 592 (Ala.l990) (listing 13 factors
for the trial court to consider when determining a
reasonable attorney fee).
The City has challenged the trial court's decision as to each facet of this calculation, contending (1) that many of the hours claimed by plaintiffs'
counsel were excessive or redundant; (2) that the
hourly rate determined by the court did not reflect
the true value of services rendered, as judged by
local standards; and (3) that the trial court's application of a multiplier of 2 was unreasonable.
A. Hours Reasonably Expended
[ 17][ 18] Applicants for an attorney fee bear the
burden of proving their entitlement to an award and
documenting their appropriately expended hours.
Edwards, 601 So.2d at 85; see also Hensley, 461
U.S. at 437, 103 S.Ct. 1933 (citing the importance
of documenting in fee applications the hours expended). "The applicant should exercise 'billing judgment' with respect to hours worked, and should
maintain billing time records in a manner that will
enable a reviewing court to identify distinct
claims." Hensley, 461 U.S. at 437, 103 S.Ct. 1933
(citation omitted). As the United States Court of
Appeals for the Eleventh Circuit stated in American
Civil Liberties Union of Ga. v. Barnes, supra:
"If fee applicants do not exercise billing judgment, courts are obligated to do it for them, to cut
the amount of hours for which payment is sought,
pruning out those that are 'excessive, redundant,
or otherwise unnecessary.' Courts are not authorized to be generous with the money of others, and
it is as much the duty of courts to see that excessive fees and expenses are not awarded as it is to
see that an adequate amount is awarded."
168 F.3d at 428.
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[19] In opposition to the hours claimed by
plaintiffs' counsel, the City enumerated several instances where it contended that the hours claimed
by opposing counsel were duplicative. Our review
of the record indicates that the trial court made no
detailed fmdings with respect to these claims. In
fact, it appears that the trial court reviewed the time
sheet submitted by plaintiffs' counsel only for multiple entries for the same work rather than for instances where attorneys Sullivan and *683 Williams might have duplicated one another's work. As
to the latter question, the trial court simply added to
its order a general statement declaring those hours
to be reasonable and necessary. Therefore, our deference with respect to the trial court's order as to
these questions is limited. As we said in Ex parte
Edwards, supra, "[a] general statement that the
number of hours spent was reasonable or unreasonable is not very helpful and, accordingly, should not
be given much weight." 601 So.2d at 86.
[20] The City contends that the trial court overlooked what the City calls redundant billing by
plaintiffs' counsel with respect to work preparing
briefs, court memoranda, and various responses to
the City's submissions. Because of the trial court's
silence with respect to these contentions, we are left
to examine the record in order to fulfill our duty of
meaningful review. Our review of the record discloses billing statements that nebulously describe
general tasks but, unfortunately, do not provide sufficient detail. While this situation, by itself, is problematic, see American Civil Liberties Union of Ga.,
168 F.3d at 429, testimony presented during the
evidentiary hearing provides adequate elucidation
supportin~the trial court's conclusion of reasonableness. 2 Therefore, we conclude that the trial
court did not abuse its discretion by finding that
there was no redundant billing with respect to work
jointly performed.
FN2. Williams testified that he and Sullivan worked together on briefs by performing different tasks. He explained that, at
times, he researched a particular area of
Page 17
the law while Sullivan wrote, using research already done. He also testified that
they often discussed arguments and
strategy as to the preparation of court documents and matters raised by the City.
[21] We now turn to the City's allegations that
some of the hours ~ended by plaintiffs' counsel
were unreasonable. 3 Our review of the record
indicates that there was conflicting and credible
testimony by both sides as to ne~ all of the specific claims of unreasonableness. 4 Because this
testimony was oral, we defer to the trial court's resolution of the pertinent factual disputes in favor of
the plaintiffs. After considering the trial court's observation, made in its order, regarding the complexity of this case, we conclude that the court did not
abuse its discretion with respect to its findings on
these matters.
FN3. The City's argument includes an assertion that the plaintiffs should not be allowed to recover attorney fees for hours
expended for fee litigation. It is hornbook
law, however, that such time is compensable. See Alba Conte, Attorney Fee Awards
§ 4.21 (2d ed.l993), and the footnotes contained therein.
FN4. At the evidentiary hearing, Williams
testified that he and Sullivan often collaborated on their filing of, or responses to,
briefs and court memoranda. They also
testified as to the complexity of the case.
The City countered with expert testimony
by John Falkenberry, an attorney, who
concluded that the hours expended by Williams and Sullivan were excessive.
[22] One matter, however, concerns us. Therecord reveals that plaintiffs' counsel included in their
fee application 27 hours spent by Sullivan trying to
convince Williams to assist him with the case. We
believe that these hours were not essential to the
plaintiffs' representation; therefore, we reduce by
27 the number of hours the trial court accepted as
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810 So.2d 667
(Cite as: 810 So.2d 667)
reasonable-this reduction yields a total of 5,789.95
hours reasonably expended.
B. The Trial Court's Determination of the Hourly
Rate
[23] The City contends that the trial court also
abused its discretion with respect*684 to the adjudged hourly rate of compensation. We agree.
The trial court's order is silent as to any justifications for the determined rate of $175 per hour,
except for a general statement declaring that the trial court had conducted "numerous fee-award cases
over the years" and, therefore, was "familiar with
the hourly market rate in the area." We acknowledge that the trial court may indeed have its fmger
on the pulse of the Birmingham legal community,
but, without evidence in the record regarding the
area's market rate, we are unable to defer to its conclusions.
The record reflects that Sullivan typically
charged clients somewhere between $80 and $150
per hour for his representation. The record contains
no other evidence as to rates of compensation.
While the complexity of this case generally supports a higher rate, we note that the record is replete
with testimony indicating that Sullivan and Williams were unfamiliar with the law applicable in this
case and, therefore, had to expend numerous hours
acquainting themselves with that law. This degree
of unfamiliarity often reflects a lack of experience,
which leads us to conclude that Sullivan and Williams had little experience in the area of law involved in this case. Therefore, based on the typical
rate usually charged by plaintiffs' counsel, their
level of experience in this area of the law, and the
complexity of this case, we conclude that $150 per
hour is a reasonable rate of compensation.
C. The Trial Court's Determination of the Multiplier
[24] The City argues next that the multiplier established by the trial court was excessive. Such a
determination is, once again, a matter we generally
leave to the trial court's discretion, see, e.g., Ex
Page 18
parte Edwards, 601 So.2d 82, 85 (Ala.l992), especially where, as here, the trial court has fully explained its reasoning in its order.
In our review of the trial court's order, we are
mindful of the 12 factors set forth in previous cases
in which we have been confronted with the question
of attorney fees. See Union Fid., 781 So.2d at 192
(quoting Edelman & Combs, 663 So.2d at 960
(summarizing 12 factors first enunciated by this
Court in Peebles v. Miley, 439 So.2d 137, 140-41
(Ala.l983))). The factor that concerns us most is
the benefit to the client received from the hours expended.
The City contends that the multiplier of 2
should be reduced because, it says, a substantial
portion of counsel's hours were expended pursuing
fee litigation rather than the litigation that provided
the substantive benefits of the original case. The
history of this case indicates that the attorney-fee
litigation began immediately after the Jefferson Circuit Court approved a settlement between the
parties regarding the placement of the solid-waste
facility. While the law clearly allows for a fee
award with respect to those hours, see note 3, supra,
we do not consider this time to be vital to the true
purpose of the litigation, which was to enhance the
due-process rights of Birmingham residents and to
prevent the placement of a solid-waste transportation facility in a particular location. Many of the
factors set forth in previous decisions by this Court
with respect to attorney-fee awards are intended
primarily to be applied to the circumstances attendant to the nature of the representation, not attorneyfee litigation. We recognize, however, that some of
the factors, such as those pertaining to questions of
local compensatory customs, are proper for a court
to consider in fee-litigation cases. Nevertheless, the
number of hours in this case expended only on fee
litigation is so great that we believe the *685 trial
court abused its discretion by determining a multiplier of 2. Considering the benefits conferred on the
plaintiffs, the time expended on the entire litigation
(including the attorney-fee litigation), and the trial
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810 So.2d 667
(Cite as: 810 So.2d 667)
court's finding regarding the complexity of this case
and counsel's performance, we conclude that a multiplier of 1.5 is warranted. We apply this figure,
however, only to those hours expended by
plaintiffs' counsel in succeeding in the primary purpose of the litigation, which was to win the enaction of a new city ordinance and to increase dueprocess protection for Birmingham residents. As
best we can discern, the hours expended in those efforts total 2,024. In calculating this portion of counsel's fee, using a 1.5 multiplier, we conclude that
plaintiffs' counsel are entitled to a fee of $455,400
for this part of their services. FN5 As for their work
on matters not essential to the result obtained as a
part of their representation, we find that plaintiffs'
counsel expended 3,765.95 hours. Because these
hours did not directly pertain to the benefit obtained
in the Horn litigation, we believe that as to those
hours the application of a multiplier is unwarranted.
Therefore, in calculating the fee as to these hours,
we conclude that, for this portion of their work,
plaintiffs' counsel are entitled to a fee of
$564,892-this figure is arrived at by multiplying the
number of hours devoted to this aspect of the case
(3,765.95) by the $150 hourly rate. Thus, the total
unadjusted fee to which plaintiffs' counsel are entitled equals $1,020,290.50, the sum of the two separately determined fee awards. When we subtract
the $250,000 interim attorney fee awarded in this
case, we determine that plaintiffs' counsel are fairly
and reasonably entitled to a fee award of
$770,292.50.
FN5. We arrive at this amount by multiplying 2024 (the number of hours reasonably
expended on litigation essential to the result obtained) by the hourly compensation
rate of $150 and then multiplying that
amount by a 1.5 multiplier.
IV.
[25] The final issue presented is whether §§
11-93-2 and 11-47-190, Ala.Code 1975, limit the
City's obligation to pay an attorney fee exceeding
$300,000. After carefully reviewing these statutes,
Page 19
we conclude that they do not.
We are unable to read either statute as pertaining to attorney-fee awards. The legislative history
of§ 11-93-2 soundly suggests that this statute and
related enactments apply only to tort liability. The
title to Act No. 673, Ala. Acts 1977, part of which
is codified at§ 11-93-2, Ala.Code 1975, reads:
"AN ACT
"To prescribe and establish monetary limits
payable on claims and judgments based on tort liability and filed or obtained against governmental
entities .... "
See St. Paul Fire & Marine Ins. Co. v. Nowlin,
542 So.2d 1190, 1192-93 (Ala.1988). Section
11-47-190 also applies only to torts, see Rich v.
City of Mobile, 410 So.2d 385, 387 (Ala.1982),
albeit torts founded upon negligence. Compare §
11-47-190 with§ 11-93-2, Ala.Code 1975.
An award of attorney fees is merely an award
of costs; thus, we conclude that § 11-93-2 and §
11-47-190 do not apply to attorney-fee awards.
1991455-REVERSED AND JUDGMENT
RENDERED.
1991558-AFFIRMED.
MOORE, C.J., and LYONS, HARWOOD,
WOODALL, and STUART, JJ., concur.
SEE, J., concurs specially.
*686 JOHNSTONE, J., concurs in part, concurs in
the result in part, and dissents in part.
HOUSTON, J., concurs in part and dissents in part.
SEE, Justice (concurring specially).
In Alabama, a party may recover attorney fees
only when an award is authorized by statute, is
provided for by contract, or is justified by a
"special equity." Horn v. City of Birmingham, 718
So.2d 691,692 (Ala.Civ.App.1997), rev'd, Ex parte
Horn, 718 So.2d 694 (Ala.1998); see also Blankenship v. City of Hoover, 590 So.2d 245 (Ala.1991).
A court may award an attorney fee on the basis that
it is justified by a special equity "where the
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810 So.2d 667
(Cite as: 810 So.2d 667)
plaintiffs efforts are successful in creating a fund
out of which the fees may be paid, or when the efforts of the plaintiffs attorneys render a public service or result in a benefit to the general public in
addition to serving the interest of the plaintiff." Ex
parte Horn, 718 So.2d 694, 702 (Ala.l998). These
circumstances have been termed the
"common-fund" and "common-benefit" exceptions.
!d.
This Court discussed the common-fund and
common-benefit exceptions in Brown v. State, 565
So.2d 585, 592 (Ala.l990), where a class of
plaintiffs, each of whom had been convicted of a
traffic offense based upon an improperly verified
Uniform Traffic Ticket and Complaint ("UTTC"),
FN6 sued the State of Alabama, the City of Montgomery, and others, seeking to have all convictions
based upon improperly verified UTTCs expunged
from their records and to have all fmes and costs
paid as a result of the convictions refunded. 565
So.2d at 586. Although this Court affirmed the
judgment of the trial court, which denied the relief
sought by the plaintiffs, this Court nevertheless
held that the plaintiffs were entitled to an award of
attorney fees:
FN6. This Court wrote in Brown:
"The defect in the procedure that we are
dealing with in this case is not the
stamping of the clerk's name by one authorized to do so. The defect is in putting
a citizen to trial on a criminal charge, albeit a misdemeanor, when no one has
sworn on oath ... that the citizen has
committed an offense."
565 So.2d at 589.
"The plaintiffs have, however, made a significant
contribution to the integrity of our system of jurisprudence in calling attention to a serious flaw in
its administration. They have done more in that
regard to advance the cause of justice than vacating the judgments of the class members would
Page 20
achieve. We are informed by counsel on both
sides of this case that because of this and similar
litigation, the practice has been discontinued and
... now the officers issuing the UTTC's appear before a judge or magistrate and swear on oath to
the charges made therein ....
II
"This litigation clearly resulted in a benefit to
the general public. It is unquestionable that
plaintiffs' attorneys rendered a public service by
bringing an end to an improper practice. The public nature of the services rendered by these lawyers justifies an award of attorney fees."
565 So.2d at 591-92 (citation omitted).
Similarly, in Bell v. Birmingham News Co., 576
So.2d 669 (Ala.Civ.App.l991), the Birmingham
News Company sought to enjoin the Birmingham
City Council from conducting closed sessions to
elect the council's president and president pro tempore. The circuit court issued the injunction and
awarded attorney fees, reasoning that the citizens of
Birmingham "derive a common benefit 'by an action which enforces *687 the requirements of the
statute that the business of the City Council be conducted in open and public meetings and, specifically, that the election of Council officers be conducted openly and not in secret.' " 576 So.2d at
670. The Court of Civil Appeals, relying on our decision in Brown, supra, determined that the record
contained ample evidence supporting the circuit
court's conclusion that the plaintiffs' actions
"resulted in a benefit to the general public." Id.
Therefore, it held, the circuit court's award of fees
pursuant to the common-benefit exception was
proper.
In this case, the plaintiffs' efforts to prevent the
construction of a waste facility in their neighborhood did not produce "a benefit to the general public" like that produced in Brown and Bell. The
plaintiffs in Brown and Bell conferred benefits that
were state-wide and city-wide, respectively; the
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810 So.2d 667
(Cite as: 810 So.2d 667)
plaintiffs' efforts here to have the waste station located in another area have not conferred a similar
benefit. Instead, it appears that the plaintiffs' efforts
benefited only those in the plaintiffs' immediate
neighborhood, to the apparent detriment of those
who would use the facility and those who are close
to its ultimate location.
This is the third time these parties have come
before this Court. In Ex parte Horn, 718 So.2d 694
(Ala.l998), a majority of this Court determined that
the common-benefit exception to the American rule
applied in this case and that the plaintiffs were
therefore entitled to an award of attorney fees paid
by the City of Birmingham. I dissented, because I
read Brown and Bell to require a benefit to society
broader than that provided to a particular neighborhood or group.
The parties came before this Court again in Ex
parte City of Birmingham, 757 So.2d 389
(Ala.1999). Following this Court's decision in Ex
parte Horn, the trial court had ordered the City to
pay an interim attorney-fee award of $250,000, and
the City sought mandamus relief in the form of a
writ from this Court directing the trial court to vacate its order awarding an interim attorney fee. The
City asked this Court to revisit its decision in Ex
parte Horn holding the common-benefit exception
applicable. This Court denied the City's petition for
mandamus relief, and, in doing so, declined to reconsider its holding that the common-benefit exception applied, noting that its prior decision in Ex
parte Horn established the law of the case. "Under
the 'law of the case' doctrine, the 'findings of fact
and conclusions of law by an appellate court are
generally binding in all subsequent proceedings in
the same case in the trial court or on a later appeal.'
" Heathcoat v. Potts, 905 F.2d 367, 370 (11th
Cir.l990) (quoting Westbrook v. Zant, 743 F.2d
764, 768 (11th Cir.1984)). Thus, the Court's conclusion that the common-benefit exception applies
in this case was binding in the mandamus proceeding.
I dissented in Ex parte Horn because I did not
Page 21
believe our prior decisions supported the conclusion that the common-benefit exception applies in
this case. While I adhere to that view, the majority's
decision in Ex parte Horn established the law of the
case. For that reason alone, I concurred in City of
Birmingham, and for that reason alone I concur
today.
JOHNSTONE, Justice (concurring in part, concurring in the result in part, and dissenting in part).
I concur in Part I (the facts and the procedural
history), in Part II (the rationale and holding approving the lodestar method for calculating the attorney's fees in this case), and the introductory explanation preceding Part I. I concur in the result of
the introductory portion of Part III about the method of calculating an *688 attorney's fee under the
lodestar method. While the explanation of the
method itself is clear and helpful, I question the
threat to the ore tenus rule posed by the statement
in the main opinion that, "[n]evertheless, the trial
court's order regarding an attorney fee must allow
for meaningful review by articulating the decisions
made, the reasons supporting those decisions, and
the performance of the attorney-fee calculation."
810 So.2d at 682. I respectfully dissent from Part
liLA. insofar as it infringes the ore tenus rule and
tweaks the computation of the compensable hours.
The main opinion says, "Because of the trial
court's silence with respect to these contentions, we
are left to examine the record in order to fulfill our
duty ofmeaningful review." 810 So.2d at 683. This
statement, too, seems to be an incursion on the ore
tenus rule. Our general rule of appellate review is
that a trial court is deemed to have found all of the
facts necessary to its decision, unless such fact
findings would be clearly erroneous. Ex parte Bryowsky, 676 So.2d 1322, 1324 (Ala.1996) ("It is also
well established that in the absence of specific findings of fact, appellate courts will assume that the
trial court made those findings necessary to support
its judgment, unless such findings would be clearly
erroneous"); Lemon v. Golf Terrace Owners Ass'n,
611 So.2d 263, 265 (Ala.1992) ("[W]here a trial
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810 So.2d 667
(Cite as: 810 So.2d 667)
court does not make specific fmdings of fact concerning an issue, this Court will assume that the trial court made those findings necessary to support
its judgment, unless such findings would be clearly
erroneous").
I respectfully dissent from Part III.B. insofar as
it tweaks the finding of the trial court on the reasonable hourly rate. The trial judge is entitled to apply common knowledge in the legal community
where he presides.
I respectfully dissent from Part III.C. insofar as
it reduces the multiplier from 2 to 1.5. The main
opinion bases the reduction on a negative analysis
of one of the 13 factors. We do not know that the
trial judge has not already considered this same
negative analysis as to this particular factor but has
found the multiplier of 2 appropriate on the basis of
one or more of the other 12 factors. The plaintiffs
sought a multiplier of 4.5. Mashburn v. National
Healthcare, Inc., 684 F.Supp. 679 (M.D.Ala.1988),
applied a multiplier greater than 3.
The trial judge's order explains his decision to
apply the multiplier of 2:
"This Court believes that an enhancement multiplier is appropriate in this case because this case
was extremely difficult, protracted, complex,
novel, and because the Plaintiffs' attorneys during
various periods of time had to devote essentially
all of their time to this case. They suffered fmancial hardship due to their involvement in the case
and used their personal and financial resources
for the benefit of the citizens of Birmingham.
"Moreover, an enhancement multiplier is justified because Plaintiffs' only hope of obtaining
fees in this case was premised on a special equity
exception to the American Rule. In this case
Plaintiffs' attorneys did not have a contract and
they did not have the benefit of some fee shifting
statute which would have guaranteed them a fee
in the event that they were prevailing parties.
Plaintiffs not only had to prevail, but they had to
Page 22
prove that they provided a common benefit to all
of the citizens of Birmingham. They succeeded
only when the highest court in the state, the
Alabama Supreme Court, made the fmding that
Plaintiffs' attorneys were entitled to an award under the common benefit or common fund *689
doctrine. The Plaintiffs' chances of prevailing in
this case were slim indeed. In fact, this Court
publicly opined in the past that Plaintiffs had
about as much chance of succeeding in this litigation as a hunchbacked grandmother had of
straightening up. The risk that Plaintiffs took and
the tremendous efforts Plaintiffs exerted deserve
a multiplier as was in Mashburn, 684 F.Supp.
679 (M.D.Ala.1988). In Mashburn, supra, the
Plaintiffs were credited with a multiplier of
3.122. The Plaintiffs allege this case was much
more complex and difficult than the Mashburn
case and seek an enhancement multiplier of 4.5
which would result in claimed fees in excess of 6
112 millions."
Our tweaking this multiplier is another violation of the ore tenus rule.
I concur in Part IV of the main opinion. I agree
with the rationale and holding "that § 11-93-2 and §
11-47-190[, Ala.Code 1975,] do not apply to attorney-fee awards." 810 So.2d at 685.
In summary, I would affirm the judgment of
the trial court in case number 1991455, City of
Birmingham v. William Fred Horn. I do concur in
the main opinion insofar as it affirms the judgment
of the trial court in case number 1991558, William
Fred Horn et a/. v. City of Birmingham et a/.
HOUSTON, Justice (concurring in part and dissenting in part).
I concur to reverse and render a judgment in
case number 1991455; however, I dissent as to the
amount of the attorney fees awarded.
I concur to affirm in case number 1991558.
Reviewing the briefs and the record, and purposefully not being specific, I am convinced that a
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
810 So.2d 667
(Cite as: 810 So.2d 667)
lack of billing judgment permeates the attorneys'
fee petition. I cannot sanction an award of $150 per
hour for most of the hours billed, and I cannot sanction applying a multiplier of 1.5 to an already excessive lodestar award. I am the only Justice remaining on the Court who voted with the majority
in Ex parte Hom, 718 So.2d 694 (Ala.l998), torequire the City to pay a legal fee to Hom's attorneys.
In my opinion, it is an abuse of discretion to award
a fee in excess of $581,695 (which includes the
$250,000 previously paid) to Hom's attorneys.
Ala.,2001.
City of Birmingham v. Hom
810 So.2d 667
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page 23
Westlaw,
304 A.D.2d 925, 758 N.Y.S.2d 195, 2003 N.Y. Slip Op. 12926
(Cite as: 304 A.D.2d 925, 758 N.Y.S.2d 195)
c
Page 1
[2] Attorney and Client 45 e= 112
Supreme Court, Appellate Division, Third Department, New York.
45 Attorney and Client
Robert C. EHLINGER, Appellant,
v.
RUBERT!, GIRVIN & FERLAZZO, P.C., et al.,
Respondents.
April 10, 2003.
Client brought legal malpractice action against
law firm and attorney that represented him in divorce action against his wife, alleging that defendants' negligence caused him to lose distributive
award in divorce action. The Supreme Court, Albany County, Teresi, J., granted summary judgment
in favor of defendants, and plaintiff appealed. The
Supreme Court, Appellate Division, Rose, J., held
that: (1) attorney's decision not to pursue pendente
lite relief to preserve client's distributive award in
divorce action did not depart from applicable standard of care, but (2) genuine issue of material facts
existed with regard to attorney's failure to file notice of pendency before client's wife encumbered
property from which he was supposed to obtain distributive award, precluding summary judgment.
Affirmed as modified.
West Headnotes
[1] Attorney and Client 45 e= 105.5
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl 05.5 k. Elements of malpractice or negligence action in general. Most Cited Cases
(Formerly 45k105)
To recover damages for legal malpractice, a
plaintiff must demonstrate that the attorney was
negligent, that the negligence was a proximate
cause of the loss sustained, and that plaintiff
suffered actual and ascertainable damages.
45III Duties and Liabilities of Attorney to Client
45k112 k. Conduct of litigation. Most Cited
Cases
Attorney's decision not to pursue pendente lite
relief to preserve client's distributive award in divorce action did not depart from applicable standard of care, as would support client's legal malpractice claim, where attorney's affidavit set forth reasonable legal strategy and accurately opined that a
pendente lite restraint could not have been obtained
in absence of a threat by client's former wife to dissipate or encumber property at issue.
[3] Judgment 228 e= 181(16)
228 Judgment
228V On Motion or Summary Proceeding
228k181 Grounds for Summary Judgment
228k181(15) Particular Cases
228k181(16) k. Attorneys, cases involving. Most Cited Cases
Genuine issue of material fact existed as to
whether notice of pendency was unavailable to protect client's interest in wife's property, whether attorney's failure to file such a notice was a departure
from applicable standard of care, and whether such
failure proximately caused client's damages, precluding summary judgment on legal malpractice
claim against law firm and attorney who represented client in divorce action. McKinney's CPLR
6501.
**195 Kriss, Kriss, Brignola & Persing, Albany
(Daniel P. O'Leary of counsel), for appellant.
Smith, Sovik, Kendrick & Sugnet, Syracuse (Kevin
E. Hulslander of counsel), for respondents.
Before: MERCURE, J.P., CREW III, PETERS,
ROSE and LAHTINEN, JJ.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
304 A.D.2d 925, 758 N.Y.S.2d 195, 2003 N.Y. Slip Op. 12926
(Cite as: 304 A.D.2d 925, 758 N.Y.S.2d 195)
*925 ROSE, J.
Appeal from an order of the Supreme Court
(Teresi, J.), entered September 11, 2001 in Albany
County, which granted defendants' motion for summary judgment dismissing the complaint.
In October 1994, plaintiff retained defendants
to represent him in a divorce action against his
wife. One of the disputed issues in the action was
ownership of certain real property titled solely in
the name of plaintiff's wife and known as the
Ridgefield **196 Drive property. Plaintiff claimed
an equitable interest in this property based upon his
having paid off its mortgage in reliance on his
wife's promise to name him a co-owner on the
deed. Well after commencement of the divorce action, and unknown to plaintiff, his wife remortgaged the Ridgefield Drive property. In September
1997, Supreme Court (Maney, J.) granted plaintiff a
divorce and distributed the parties' property (
Ehlinger v. Ehlinger, 174 Misc.2d 344, 664
N.Y.S.2d 401). Based on its finding that plaintiff
was entitled to a constructive trust upon the Ridgefield Drive property, the court ordered his wife to
either repay him $161,595.06, the net amount he invested in the property, or convey her interest in the
property to him. However, his wife's actions in
mortgaging the property before the divorce, filing
for bankruptcy immediately afterward and precipitating a foreclosure precluded plaintiff from recovering the distributive award.
In September 1999, plaintiff commenced this
legal malpractice action alleging that the failure of
his counsel, defendant Elaine M. Pers, to seek pendente lite relief in the divorce action or file a notice
of pendency as to the Ridgefield Drive property
constituted negligence and caused him to lose the
1997 distributive award. Defendants then moved
for summary judgment dismissing the complaint
based on the affidavits of their counsel and Pers describing her representation of plaintiff as competent
and opining that neither pendente lite relief nor a
notice of pendency based upon a claim of a constructive trust would have been a legally viable
Page2
remedy before the divorce judgment was issued.
Finding that the lack of a demonstrable threat to encumber the property would have precluded a pendente lite restraint against plaintiff's wife and that it
was "unlikely" that plaintiff would have been entitled to the imposition of a constructive trust, Supreme Court granted defendants' motion and dismissed the complaint, prompting this appeal by
plaintiff.
[1] *926 "To recover damages for legal malpractice, a plaintiff must demonstrate that the attorney was negligent, that the negligence was a proximate cause of the loss sustained and that plaintiff
suffered actual and ascertainable damages" (Busino
v. Meachem, 270 A.D.2d 606, 609, 704 N.Y.S.2d
690 [citations omitted]; see Amav Indus. Inc. Retirement Trust v. Brown, Raysman, Millstein, Felder & Steiner, 96 N.Y.2d 300, 303-304, 727
N.Y.S.2d 688, 751 N.E.2d 936). For defendants to
succeed on their motion for summary judgment
here, they were required to present evidence in admissible form establishing that plaintiff is unable to
prove at least one of these elements (see Suydam v.
O'Neill, 276 A.D.2d 549, 714 N.Y.S.2d 686; Shopsin v. Siben & Siben, 268 A.D.2d 578, 702
N.Y.S.2d 610).
[2] Upon our review of the record, we agree
that defendants' submissions were sufficient to
show that Pers's decision not to pursue pendente lite
relief did not depart from the applicable standard of
care (see Beltrone v. General Schuyler & Co., 223
A.D.2d 938, 939, 636 N.Y.S.2d 917). In this regard,
Pers's affidavit is not conclusory ( cf Estate of
Neve/son v. Carro, Spanbock, Kaster & Cuiffo, 259
A.D.2d 282, 284, 686 N.Y.S.2d 404), but rather
sets forth a reasonable legal strategy and accurately
opines that a pendente lite restraint could not have
been obtained in the absence of a threat by
plaintiff's wife to dissipate or encumber the property (see Strong v. Strong, 142 A.D.2d 810, 812,
530 N.Y.S.2d 693; cf Maillard v. Maillard, 211
A.D.2d 963, 964, 621 N.Y.S.2d 715). Plaintiff's responding papers fail to raise a question of fact as to
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Page3
304 A.D.2d 925,758 N.Y.S.2d 195,2003 N.Y. Slip Op. 12926
(Cite as: 304 A.D.2d 925, 758 N.Y.S.2d 195)
pendente lite relief because he submits no expert affidavit describing the applicable standard of care or
**197 opining that a pendente lite restraint could
have been obtained (see e.g. Zeller v. Copps, 294
A.D.2d 683, 684, 741 N.Y.S.2d 343).
[3] We reach a different conclusion, however,
with regard to Pers's failure to file a notice of pendency before plaintiffs wife encumbered the Ridgefield Drive property. Defendants' moving papers are
insufficient to show that this failure was not malpractice or the proximate cause of plaintiff's damages. Pers's affidavit simply does not address the
absence of a notice of pendency. While defendants'
counsel avers that "[i]t is * * * well settled that
plaintiff had no right to obtain a lis pendens when
he clearly had no legal interest in the property," this
opinion is conclusory and patently inaccurate because there is no dispute that plaintiff claimed an
equitable interest in the Ridgefield Drive property
and sought the imposition of a constructive trust.
Since actions seeking to impose a constructive trust
on real property "obviously affect[ ] title to real
property" (Grossfeld v. Beck, 42 A.D.2d 844, 844,
346 N.Y.S.2d 650; see Peterson v. Kelly, 173
A.D.2d 688, 689, 570 N.Y.S.2d 592), the filing of a
notice of *927 pendency would have been an available and appropriate prejudgment safeguard in the
divorce action (see CPLR 6501; 5303 Realty Corp.
v. 0 & Y Equity Corp., 64 N.Y.2d 313, 318, 486
N.Y.S.2d 877, 476 N.E.2d 276; Letizia v. Flaherty,
207 A.D.2d 567, 569, 615 N.Y.S.2d 487, appeal
dismissed 84 N.Y.2d 922, 621 N.Y.S.2d 520, 645
N.E.2d 1220). Moreover, since the court in the divorce action found that the guideline factors for a
constructive trust had been established (Ehlinger v.
Ehlinger, supra at 349, 664 N.Y.S.2d 401; see e.g.
Gaglio v. Molnar-Gaglio, 300 A.D.2d 934, 938,
753 N.Y.S.2d 185), Supreme Court's view that such
a finding was "unlikely" is plainly contradicted by
the record and controlling precedent (see Lester v.
Zimmer, 147 A.D.2d 340, 342, 542 N.Y.S.2d 855
[constructive trust is not confined to reconveyance
situations] ). Thus, defendants' moving papers are
inadequate to establish that a notice of pendency
was unavailable to protect plaintiffs interest, that
the failure to file such a notice did not constitute a
departure from the applicable standard of care or
that such failure did not proximately cause
plaintiff's damages. As a result, the burden to prove
that this failure departed from the standard of care
or proximately caused plaintiffs damages was not
shifted to plaintiff.
ORDERED that the order is modified, on the
law, without costs, by reversing so much thereof as
granted defendants' motion for summary judgment
dismissing the claim based on defendants' failure to
file a notice of pendency; motion denied to that extent; and, as so modified, affirmed.
MERCURE, J.P., CREW III, PETERS and
LAHTINEN, JJ., concur.
N.Y.A.D. 3 Dept.,2003.
Ehlinger v. Ruberti, Girvin & Ferlazzo, P.C.
304 A.D.2d 925, 758 N.Y.S.2d 195, 2003 N.Y. Slip
Op. 12926
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Westlaw.
Page 1
Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist.))
H
CHECK OIDO SUPREME COURT RULES FOR
REPORTING OF OPINIONS AND WEIGHT OF
LEGAL AUTHORITY.
Court of Appeals of Ohio,
Eighth District, Cuyahoga County.
Lu-Jean FENG, Plaintiff-Appellee
v.
KELLEY & FERRARO, et al., Defendants-Appellants.
No. 91738.
Decided March 26, 2009.
Background: Fonner client brought legal malpractice action against attorneys who had represented
her in underlying divorce action. After a jury trial,
the Court of Common Pleas, Cuyahoga County, No.
CV-580568, denied attorneys' motion for a directed
verdict and entered judgment in favor of client. Attorneys appealed.
Holding: The Court of Appeals, Mary Eileen Kilbane, P.J., held that attorneys' negligence was the
proximate cause of client's settling divorce action
on unfavorable terms.
Affirmed.
West Headnotes
[1] Attorney and Client 45 €= 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k112 k. Conduct of Litigation. Most Cited
Cases
Attorneys' negligent representation, pressuring
client to settle her divorce case by representing to
client that opposing counsel had threatened to use
an allegedly misleading loan document that client
had signed to obtain a criminal indictment against
client, but without informing client that such threats
were illegal, was the proximate cause, as an element of client's legal malpractice claim against attorneys, of client's settling divorce action on unfavorable terms; if client had not settled, she would
have been virtually guaranteed a more favorable
outcome under "equal unless equal is not equitable"
standard governing property distributions in divorces. R.C. § 3105.171.
[2] Estoppel 156 €= 91(3)
156 Estoppel
156III Equitable Estoppel
156III(B) Grounds of Estoppel
156k89 Acquiescence
156k91 Assent to or Participation in
Judicial Proceedings
156k91(3) k. Compromises. Most
Cited Cases
Client could not be equitably estopped from
bringing claim of legal malpractice against attorneys who had negligently pressured her into settling
her divorce action, on the basis of client's affirmations under oath that she had agreed to her divorce
settlement, since client was acting on attorneys' advice in agreeing to settlement; client's affirmations
did not show that attorneys' advice met the standard
of care.
[3] Evidence 157 €= 34
157 Evidence
1571 Judicial Notice
157k34 k. Laws ofUnited States. Most Cited
Cases
Trial court could take judicial notice of the existence of a mens rea requirement found in federal
fraud statute, in legal malpractice action in which
an issue was client's knowledge of alleged misstatements made in loan documents; accuracy of the
mens rea requirement was readily discernable from
the text of the statute itself. 18 U.S.C.A. § 1001;
Rules ofEvid., Rule 201(B).
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page2
Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist.))
Civil Appeal from the Cuyahoga County Court of
Common Pleas, Case No. CV-580568.James
O'Connor, Christopher R. Kakish, Nicholas D.
Satullo, Reminger & Reminger, Cleveland, OH, for
appellants.
Michael J. Maillis, Paul G. Perantinides, Perantinides & Nolan Co ., L.P.A., Akron, OH, for appellee.
Before: KILBANE, P.J., McMONAGLE, J., and
JONES, J.
MARY EILEEN KILBANE, P.J.
*1 N.B. This entry is an announcement of the
court's decision. See App.R. 22(B) and 26(A);
Loc.App.R. 22. This decision will be journalized
and will become the judgment and order of the
court pursuant to App.R. 22(C) unless a motion for
reconsideration with supporting brief, per App.R.
26(A), is filed within ten (10) days of the announcement of the court's decision. The time period
for review by the Supreme Court of Ohio shall begin to run upon the journalization of this court's announcement of decision by the clerk per App.R.
22(C). See, also, S.Ct. Prac.R. II, Section 2(A)(l).
{, 1} Kelley & Ferraro (K & F) appeals from a
jury verdict in favor of appellee, Lu-Jean Feng,
M.D. (Feng), who sued the firm for legal malpractice. For the following reasons, we affirm.
{, 2} On December 29, 2005, Feng sued K & F
in common pleas court alleging that it breached the
standard of care by failing to properly handle her
divorce case. She alleged that K & F did not prepare adequately for the trial. She further alleged
that K & F's attorneys exerted undue influence over
her to settle the divorce when they advised her that
she was subject to criminal and medical licensure
penalties related to signing her name on a loan application that allegedly overvalued her clinic. Feng
claimed that if K & F had not coerced her into a
settlement based upon specious threats of criminal
indictments and licensure problems, she would
have achieved a better resolution of her divorce at
trial.
{, 3} On May 28, 2008, the malpractice case
proceeded to trial. At the close of plaintiff's case, K
& F moved for directed verdict, which was denied.
Prior to the conclusion of trial, K & F sought a jury
instruction on equitable estoppel based upon Feng's
prior testimony that she understood and agreed to
the terms of the divorce settlement. Because of this
testimony, K & F argued that Feng was estopped
from claiming that K & F committed malpractice
against her. The trial court refused to instruct the
jury on this issue.
{, 4} On June 3, 2008, the jury returned a verdict in favor of Feng, awarding $832,929.50 in
damages.
{, 5} On June 17, 2008, K & F filed a motion
for new trial and a motion for judgment notwithstanding the verdict, both of which were denied.
This appeal followed.
{, 6} ASSIGNMENT OF ERROR ONE
"The Trial Court erred in denying DefendantAppellant's motions for directed verdict and
for judgment notwithstanding the verdict because Plaintiff-Appellee failed to present evidence that the alleged legal malpractice proximately caused her damages."
{, 7} Motions for directed verdict and motions
for judgment notwithstanding the verdict (JNOV)
are subject to de novo review. Pariseau v. Wedge
Products, Inc. (1988), 36 Ohio St.3d 124, 522
N.E.2d 511. In reviewing such motions, we are required to test whether the evidence, when construed
most strongly in favor of appellees, is legally sufficient to sustain the verdict. Environmental Network Corp. v. Goodman Weiss Miller, L.L.P., 119
Ohio St.3d 209, 893 N.E.2d 173, 2008-0hio-3833.
Where, as here, a plaintiff claims that she would
have been better off if the underlying matter had
been tried rather than settled, the standard for prov-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
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Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist))
ing causation requires more than just some evidence of the merits of the underlying lawsuit. Jd. at
213, 893 N.E.2d 173. Thus, in the case sub judice,
Feng had the burden of proving that but for K & F's
conduct, she would have received a more favorable
outcome in the underlying matter. Id.
*2 [ 1] {~ 8} In both the directed verdict and
JNOV motions, and indeed in its brief, appellant argues that Feng has failed to submit sufficient evidence of proximate cause to either allow the jury to
decide the case and/or to support its verdict. When
viewing the evidence most strongly in favor of
Feng, as the law requires, we disagree.
{~ 9} The crux of Feng's malpractice claim
stemmed from advice she received from K & F on
the second day of her divorce trial that an allegedly
false loan document that she signed subjected her to
federal prosecution and/or forfeiture of her medical
license. Specifically, Feng claimed that K & F's attorneys pressured her into settling the case on the
second day of trial, rather than testify about the
specifics of the loan document. As a result of K &
F's malpractice, Feng claimed she received an inequitable distribution of assets. A jury agreed with
her claims.
{~ 10} While there is considerable debate
about the level of Feng's knowledge surrounding
the loan document, what is undisputed is that K &
F, through its attorneys, FNl represented to Feng
that her opposing counsel threatened to use the loan
document to get her indicted. No one from K & F
told Feng that such threats are illegal and unethicalthat is, that no attorney may use the threat of criminal prosecution to effect a result in a civil case.
FN2 See Cuyahoga Cty. Bar Assn. v. Wise, 108
Ohio St.3d 164, 842 N.E.2d 35, 2006-0hio-550.
This specious threat was the fulcrum that K & F
used to settle Feng's divorce case.
FNl. One of whom represented to Feng
that he was a white-collar criminal defense
lawyer.
FN2. Ohio Professional Conduct Rule
1.2(e).
{~ 11} The quantum of evidence necessary to
prove causation in a legal malpractice case is relatively straightforward. Feng was required to prove
what amounts to the "case within a case," whereby
all issues that would have been litigated in the previous action are litigated between the plaintiff and
the plaintiffs former lawyer, with the latter taking
the place and bearing the burdens the plaintiff
would have borne in the original trial. Environmental Network, supra. Taking on these roles,
Feng's burden at trial was to prove that the outcome
of her divorce would have been different if she had
tried the case. Id. In order to prove causation and
damages, Feng was required to prove that the K &
F's actions resulted in settling the case for less than
she would have received at trial. Id. at syllabus.
{~ 12} K & F argues that this case is factually
similar to Environmental Network and should be
decided identically. However, this case is factually
distinguishable from Environmental Network for
two reasons. First, the settlement in this case was
decidedly unfavorable to Feng, whereas the settlement in Environmental Network was favorable. Id.
at 214-216, 893 N.E.2d 173. Second, the appellees
in Environmental Network, in adhering to the standard set forth in Vahila v. Hall, 77 Ohio St.3d 421,
674 N.E.2d 1164, 1997-0hio259, failed to show on
appeal that the outcome would have been different
if they had tried the case. Such is not the case here.
*3 {~ 13} At trial, Feng's counsel elicited evidence that K & F failed to meet the standard in several ways. These include firing the court-appointed
asset appraiser and failing to hire a new appraiser to
value the business assets of Feng's husband. This
firing resulted not only in the failure to properly
evaluate the marital assets, but also in the former
appraiser obtaining a judgment against Feng.
{~ 14} According to Feng, one of K & F's attorneys said they would "take care of' representing
her in that matter. The record does not reflect that
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
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Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist.))
they ever did so.
{~ 15} According to the record, K & F's failure
to hire an expert to value the business of Feng's
husband resulted in its considerable worth being
left out of the evaluation of marital assets. What is
more, the marital assets that were valued by K & F
in the case were valued as of 2001, not 2004, because there were three years' worth of valuations
missing from the assets in K & F's files. Also, the
final settlement was inconsistent with R.C.
3105.171-0hio's "equal unless equal is not equitable" standard. FN3
FN3. R.C. 3105.17l(C){l) states: "Except
as provided in this division or division (E)
of this section, the division of marital
property shall be equal. If an equal division of marital property would be inequitable, the court shall not divide the marital
property equally but instead shall divide it
between the spouses in the manner the
court determines equitable."
{~ 16} At trial, Feng's counsel proved that
there was a discrepancy of approximately $815,000
between what Feng received through settlement and
what she would have received at trial, based upon
the total accounting of all marital assets and R.C.
3105.171. The evidence in the record, relied upon
by the jury in reaching its verdict, is that Feng
would have received a better outcome had she tried
her divorce case. The jury awarded her
$832,929.50.
{~ 17} In its appeal, K & F argues that because
she failed to disclose the existence of the loan document to them, Feng is unable to prove that "but
for" K & F's negligent conduct, she would have received a better result in her divorce. They argue
that she never disclosed the documents, even when
they asked her to. They further argue that they were
surprised on the second day of the divorce trial
when opposing counsel produced the loan application with Feng's signature from Charter One Bank.
{~ 18} But K & F's argument assumes that it
should not have known of the documents before trial, and that the advice it dispensed to Feng with respect to the loan document, as well as the nature in
which they dispensed that advice, met the standard
of care. We hold it did not. K & F received notice
that Feng's Charter One accounts were being subpoenaed one month before trial. Feng's attorneys
elicited expert testimony that the failure to investigate the Charter One subpoena breached the standard
of care. K & F did not rebut this at trial.
{~ 19} Although K & F argues that Feng was
unwilling to try the case because of this document,
it fails to acknowledge that the source of Feng's unwillingness emanated from their own advice. In addition to ignoring its other failures in trial preparation and its failure to accurately value the marital
estate, K & F's argument also ignores its failure to
(a) discern the loan document's existence until day
two of the trial, when, in fact, K & F had over one
month to fmd this document, and {b) advise Feng
candidly about the actual consequences she faced in
light of the document, which were much more minimal thanK & Fled her to believe.FN4
FN4. In fact, Feng's loan (the repayment of
which was never an issue in either the divorce or malpractice case) is a matter
between her and the bank. She has never
been subjected to any negative civil or
criminal penalties for negotiating it; much
less prosecution and/or loss of her medical
license because of it.
*4 {~ 20} Feng testified that she told her lawyers she never knowingly attempted to defraud the
bank by signing the loan papers. Their response, according to Feng, was to state that all opposing
counsel (or anyone) had to do was "walk across the
street" and get her indicted. Further, K & F represented that opposing counsel in her divorce action
possessed just the type of unsavory character to do
so.
{~ 21} True or not, this ignores the fact that
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
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Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist))
such a threat is illegal in the ftrst instance, and cannot be used tMain advantage in a civil case, much
less settle it. 5 Giving legal advice based upon
such specious threats and using them to cajole a client into settling a divorce case upon harshly inequitable terms violates the standard of care for a
reasonably prudent and competent attorney in the
same or similar circumstances.
FNS. Ohio Prof. Cond. Rule 1.2(e).
{~ 22} K & F's failure to prepare for trial and
consequent use of a document it should have known
about before the second day of trial so as to pressure Feng into settling the case constituted malpractice. But forK & F's advising Feng to settle the divorce case on the basis of the loan document, she
would have received a more favorable outcome.
Ohio's "equal unless not equitable" law virtually
guarantees she would have received a better outcome if she had tried the case.
{~ 23} Based upon the above evidence elicited
at trial, the trial court did not err in denying K & F's
motions for directed verdict and judgment notwithstanding the verdict. When viewed in a light most
favorable to Feng, these facts prove that a jury
could reasonably have found that K & F committed
malpractice in representing Feng in her divorce.
{~ 24} Appellant's fust assignment of error is
overruled.
{~ 25} ASSIGNMENT OF ERROR TWO
" The Trial Court committed prejudicial and
reversible error when it failed to instruct the
jury on equitable estoppel and later, when it
denied Ketley & Ferraro's Motion for New
Trial."
{~ 26} It is well established that trial courts
will not instruct the jury where there is no evidence
to support an issue. Riley v. Cincinnati (1976), 46
Ohio St.2d 287, 348 N.E.2d 135. Further, "[i]n reviewing a record to ascertain the presence of sufficient evidence to support the giving of an instruction, an appellate court should determine whether
the record contains evidence from which reasonable
minds might reach the conclusion sought by the instruction." Feterle v. Huettner (1971), 28 Ohio
St.2d 54, 57, 275 N.E.2d 340.
{~ 27} The record before this court is devoid of
evidence upon which reasonable minds might reach
the conclusion sought by appellant's equitable estoppel instruction request.
[2] {~ 28} In its second assignment of error, K
& F argues in essence that Feng's subsequent sworn
representations that she assented to the settlement
somehow show that the trial judge erred in failing
to instruct the jury on equitable estoppel and denying its motion for new trial. K & F argues that because Feng was unwilling to accept any degree of
risk of criminal and licensure penalties as a result
of the loan document she is estopped from claiming
that K & F committed malpractice. K & F cites to
examples in the record below where Feng affirmed
that she agreed to her divorce settlement under
oath.
*5 {~ 29} As stated above, this argument assumes that Feng acted in a vacuum; it ignores the
provenance of the advice K & F gave to her in the
fust place. Feng's assent to the terms of her divorce
decree only underscores the fact that she followed
her attorneys' advice. It does not mean that advice
met the standard of care.
{~ 30} Based upon the foregoing facts, the trial
court committed no error in refusing to instruct the
jury on equitable estoppel.
{~ 31} With respect to the denial of K & F's
motion for new trial, aside from its mention in the
assignment of error, K & F fails to argue this point
anywhere in its brief. We therefore decline to address it. See App.R 12(A){2). "The court may disregard an assignment of error presented for review
if the party raising it fails to identify in the record
the error on which the assignment of error is based
or fails to argue the assignment separately in the
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
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Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist.))
brief, as required under App.R. 16(A)." !d.
ASSIGNMENT OF ERROR THREE
"The trial court committed prejudicial and reversible error wheh it took judicial notice of
the mens rea required under 18 USCA § 1001,
et seq."
[3] {,-r 32} A court may take judicial notice of a
fact not subject to reasonable dispute that is
"capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably
be questioned." Evid.R. 201(B). The court may do
so at any time during the proceeding. Evid.R.
201(F). Pursuant to Evid.R. 201(C), it is clearly
within the trial court's discretion to take judicial notice. Moreland Hills v. Gazdak (1988), 49 Ohio
App.3d 22,550 N.E.2d 203.
{,-r 33} In this case, the trial court, during the
cross-examination of one of K & F's witnesses,
took judicial notice that there is a mens rea aspect
to any crime. According to K & F, the trial court's
taking judicial notice of this fact wrongly implied
to the jury that Feng was required to act with specific intent to defraud her bank in order to be subject to criminal penalties when she signed her loan
documents. Such an argument is without merit.
{,-r 34} K & F argues that it was prejudiced by
the court's judicial notice that mens rea is an aspect
of any crime, because the court denied their motion
for directed verdict. K & F argues that in denying
its motion, the court specifically relied on the mens
rea requirement found in 18 USCA § 1001, et seq.
Nowhere is this found in the record.
{,-r 35} The trial court, outside of the presence
of the jury, denied the motion for directed verdict,
and in doing so indicated during its colloquy with
counsel that one of K & F's witnesses, Mr. Wilson,
testified there was a negligence aspect to the statute. The court merely stated that it disagreed with
that reading. Since no jurors were present at this
time, the court could not have implied anything
about the intent aspect of the statute to the jury.
What is more, the judicial notice K & F complains
of took place during the cross-examination of Mr.
Frost, where the court simply stated "[t]hat there is
a requirement * * * called mens rea, and there's an
intent aspect to any crime in the State of Ohio, and
that's applicable to both statewide and federal."
Nothing in this statement implies any requirement
at all-other than its existence-to the jury.
*6 {,-r 36} Further, the court cured any potential
prejudice by properly instructing the jury that it was
not to infer anything from the court's conduct of the
trial, or its rulings, stating: "[i]f I said or did anything during the course of this trial that gives you
any indication of my thought process, please disregard it. Don't let that factor into your decision of
this case."
{,-r 37} Because the mens rea requirement of
any crime is a fact that is readily discemable by resort to sources whose accuracy cannot reasonably
be questioned (in this case the U.S.Code), the court
did not abuse its discretion in taking judicial notice
of the mens rea requirement of 18 USCA § 1001, et
seq. The accuracy of the mens rea requirement is
readily discemable from the text of the statute itself, and taking such notice is strictly in accord
with Evid.R. 201(B). Because of this, the trial court
did not abuse its discretion in taking such notice.
{,-r 38} Appellant's third assignment of error is
overruled.
Judgment affirmed.
It is ordered that appellee recover from appellant costs herein taxed.
The court finds there were reasonable grounds
for this appeal.
It is ordered that a special mandate be sent to
said court to carry this judgment into execution.
A certified copy of this entry shall constitute
the mandate pursuant to Rule 27 of the Rules of
Appellate Procedure.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.), 2009 -Ohio- 1368
(Cite as: 2009 WL 790345 (Ohio App. 8 Dist.))
CHRISTINE T. McMONAGLE and LARRY A.
JONES, JJ., concur.
Ohio App. 8 Dist.,2009.
Feng v. Kelley & Ferraro
Slip Copy, 2009 WL 790345 (Ohio App. 8 Dist.),
2009 -Ohio- 1368
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page7
Westlaw,
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168,646 A.2d 195)
Supreme Court of Connecticut.
Elyn K. GRAYSON
v.
WOFSEY, ROSEN, KWESKIN AND KURlANSKY et al.
No. 14889.
Argued May 5, 1994.
Decided Aug. 23, 1994.
Client filed malpractice action against attorneys that represented her in marriage dissolution
proceeding for alleged negligence of attorneys in
advising settlement based on inadequate financial
information regarding husband's estate. The Superior Court, Judicial District of Fairfield, Ballen, J.,
entered award of $1,500,000 in favor of client. Attorneys appealed. The Supreme Court, Palmer, J.,
held that: (1) client who agreed to settlement dissolution action in reasonable reliance on advice of her
attorneys was entitled to bring malpractice claim
against attorneys; (2) finding that attorneys were
negligent in representation of client was supported
by sufficient evidence; (3) finding that attorneys'
negligence was pro~imate cause of client's economic damage was supported by sufficient evidence; (4)
verdict of $1,500,000 was not excessive; (5) testimony of client that attorneys failed to seek order of
alimony pendente lite despite client's request that
they do so was relevant to claim of negligence; (6)
trial court properly required attorney to testify on
cross-examination as to whether he believed that
judge presiding over marital dissolution proceeding
held view that proper role of a client was in home;
(7) testimony of expert as to attorneys' failure to
bring to attention of marital dissolution court certain financial information concerning husband's
business interests prior to settlement was relevant;
and (8) trial court's admission of prior judicial opinions in marital dissolution proceeding was not abuse of discretion.
Page I
Affirmed.
West Headnotes
[1) Attorney and Client 45 e= 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kll2 k. Conduct of Litigation. Most Cited
Cases
Client, who agreed to settlement of marriage
dissolution action in reasonable reliance on advice
of her attorneys, was entitled to bring malpractice
claim against attorneys for negligence; fact that settlement had been approved by trial court did not insulate attorneys from malpractice action.
[2) Attorney and Client 45 e= 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k112 k. Conduct of Litigation. Most Cited
Cases
When it has been established that attorney, in
advising client concerning settlement of action, has
failed to exercise degree of skill and learning commonly applied under all circumstances in community by average, prudent, reputable member of
legal profession and that conduct has resulted in injury, loss, or damage to client, client is entitled to
recovery against attorney.
[3) Appeal and Error 30 e= 863
30 Appeal and Error
30XVI Review
30XVI(A) Scope, Standards, and Extent, in
General
30k862 Extent of Review Dependent on
Nature of Decision Appealed from
30k863 k. In General. Most Cited
Cases
Supreme Court undertakes only limited appellate review of trial court's denial of motion for
judgment notwithstanding the verdict; greatest de-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
ference is accorded trial court's superior opportunity to view trial in its entirety.
[4] Attorney and Client 45 C=> 129(2)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(2) k. Pleading and Evidence.
Most Cited Cases
Finding that attorneys were negligent in representation of client during dissolution proceedings
was supported by evidence that attorneys failed to
discover value of husband's business interests and
related assets, which resulted in attorneys' advice
that client accept inadequate settlement offer.
[5] Evidence 157 C=> 571(9)
157 Evidence
157XII Opinion Evidence
157XII(F) Effect of Opinion Evidence
157k569 Testimony ofExperts
157k571 Nature of Subject
157k571(9) k. Cause and Effect.
Most Cited Cases
Finding that attorneys' negligent representation
of client during dissolution proceedings was proximate cause of client's economic damage was supported by expert testimony that competent counsel
would not have advised client to enter into settlement agreement and that client would have received
significantly greater distribution of marital estate
had she been properly represented.
[6] Attorney and Client 45 C=> 129(4)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(4) k. Damages and Costs. Most
Cited Cases
Verdict of$1,500,000 awarded to client in malpractice action brought against attorneys who repPage2
resented client in marital dissolution proceeding
was not excessive; value of marital estate was approximately $2,400,000, while settlement entered
into upon advice of attorneys was approximately
$450,000.
[7] Attorney and Client 45 C=> 129(2)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(2) k. Pleading and Evidence.
Most Cited Cases
In attorney malpractice action, testimony of client that attorneys failed to seek order of alimony
pendente lite in dissolution proceeding despite client's request that they do so was relevant to claim
of negligence in failing to discover value of marital
assets; testimony bore relevance to relationship
between client and attorneys, in particular to manner in which attorneys had responded to client's requests.
[8] Attorney and Client 45 C=> 129(2)
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k129 Actions for Negligence or Wrongful
Acts
45k129(2) k. Pleading and Evidence.
Most Cited Cases
In attorney malpractice action, trial court properly required attorney to testify on cross-examination as to whether he believed that judge
presiding over marital dissolution proceeding in
which attorney represented client held view that
proper role of a client was in home; attorney's beliefs concerning judge's views toward women were
relevant to issue of how attorneys intended to address any perceived bias of judge.
[9] Evidence 157 C=> 512
157 Evidence
157XII Opinion Evidence
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
157XII(B) Subjects of Expert Testimony
157k512 k. Due Care and Proper Conduct
in General. Most Cited Cases
In attorney malpractice action, testimony of expert as to wife's attorneys' failure to bring to attention of marital dissolution court certain financial information concerning husband's business interests
prior to settlement was relevant to issue of alleged
negligence of attorneys in advising settlement
based on insufficient information regarding value
of marital estate.
[10] Evidence 157 €= 571(3)
157 Evidence
157XII Opinion Evidence
157XII(F) Effect of Opinion Evidence
157k569 Testimony ofExperts
157k571 Nature ofSubject
157k571(3) k. Due Care and Proper
Conduct. Most Cited Cases
In malpractice cases, expert's testimony must
be evaluated in terms of its helpfulness to trier of
fact on specific issues of standard of care and alleged breach of that standard; once threshold question of usefulness to jury has been satisfied, any
other questions regarding expert's qualifications
properly go to weight, and not to admissibility, of
testimony.
[11] Evidence 157 €= 332(1)
157 Evidence
157X Documentary Evidence
157X(A) Public or Official Acts, Proceedings, Records, and Certificates
157k332 Judicial Acts and Records
157k332(1) k. In General. Most Cited
Cases
In attorney malpractice action brought by client
for alleged negligence of attorneys in advising settlement of marital dissolution proceeding, trial
court's admission of prior judicial opinions from
marital dissolution proceeding was not abuse of discretion, where attorney's counsel referred to opinions in opening statement, using opinions to
Page3
strongly suggest that each decision constituted ratification of settlement agreement.
[12] Evidence 157 €= 146
157 Evidence
157IV Admissibility in General
157IV(D) Materiality
157kl46 k. Tendency to Mislead or Confuse. Most Cited Cases
Although relevant, evidence may be excluded
by trial court if court determines that prejudicial effect of evidence outweighs its probative value.
[13] Appeal and Error 30 €= 216(1)
30 Appeal and Error
30V Presentation and Reservation in Lower
Court of Grounds of Review
30V(B) Objections and Motions, and Rulings
Thereon
30k214 Instructions
30k216 Requests and Failure to Give
Instructions
30k216(1) k. In General. Most
Cited Cases
Appeal and Error 30 €= 263(1)
30 Appeal and Error
30V Presentation and Reservation in Lower
Court of Grounds of Review
30V(C) Exceptions
30k258 Review of Proceedings at Trial
30k263 Instructions, and Failure or
Refusal to Give Instructions
30k263(1) k. In General. Most
Cited Cases
Supreme Court would not consider challenge to
trial court's instructions to jury, absent request that
trial court refer to any specific facts in jury charge
and failure to except to trial court's instruction on
that ground. Practice Book 1978, § 315.
(14] Appeal and Error 30 €= 215(1)
30 Appeal and Error
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646 A.2d 195
231 Conn. 168, 646 A.2d 195, 63 USL W 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
30V Presentation and Reservation in Lower
Court of Grounds of Review
30V(B) Objections and Motions, and Rulings
Thereon
30k214 Instructions
30k215 Objections in General
30k215(1) k. Necessity of Objection in General. Most Cited Cases
Supreme Court would decline to review unpreserved jury instruction claim for plain error; review
under plain error doctrine was reserved for truly extraordinary situations. Practice Book 1978, § 4185.
**197 *169 William F. Gallagher, with whom, on
the brief, were Elizabeth A. Gallagher, New Haven,
and Robert W. Lotty, Fairfield, for appellants
(defendants).
Sue L. Wise, New Haven, with whom was Edward
N. Lerner, Fairfield, for appellee (plaintiff).
Before *168 PETERS, C.J., and CALLAHAN,
BORDEN, PALMER and O'CONNELL, JJ.
PALMER, Associate Justice.
The principal issue raised by this appeal is
whether a client who has agreed to the settlement of
a marital dissolution action on the advice of his or
her attorney may then recover against the attorney
for the negligent handling of her case. The plaintiff,
Elyn K. Grayson, brought this action against the defendants, Edward M. Kweskin, Emanuel Margolis,
and their law firm, Wofsey, Rosen, Kweskin and
Kuriansky, alleging that they had committed legal
~alprac_tice in ~e PMf
1
aration and settlement of her
dissolution action. *170 After trial, a jury returned a verdict in the amount of $1,500,000
against the defendants. The trial court, Ballen, J,
rendered judgment for the plaintiff in accordance
with the jury verdict, and this appeal followed. FN2
The defendants claim that: (1) the plaintiff failed to
establish, as a matter of law, that she was entitled to
a recovery against them; (2) the evidence was insufficient to support the jury's verdict; (3) the trial
Page4
court's rulings on certain evidentiary issues constituted an abuse of discretion; and (4) the trial court's
instructions to the jury were improper. We affirm
the judgment of the trial court.
FNl. The plaintiff also brought suit against
Robert Gervasoni, an accountant who assisted the defendants in the preparation of
the marital dissolution action, and Gervasoni's accounting firm, Edward Isaacs Co.
(Isaacs). The jury returned a verdict in favor of Gervasoni and Isaacs. Because the
plaintiff has not appealed from the judgment rendered for Gervasoni and Isaacs,
they are not parties to this appeal.
FN2. The defendants appealed from the
judgment of the trial court to the Appellate
Court, and we transferred the appeal to this
court pursuant to Practice Book § 4023 and
General Statutes § 51-199( c).
The relevant facts and procedural history are as
follows. In 1981, Arthur I. Grayson (husband)
brought an action against the plaintiff for the dissolution of their marriage. On May 28, 1981, the
third day of the dissolution trial before Hon. William L. Tierney, Jr., state trial referee, the plaintiff,
on the advice of the defendants, agreed to a settlement of the case that had been negotiated by the defendants and counsel for her husband. The agreement provided, inter alia, that the plaintiff would
receive lump sum alimony of $150,000 and periodic alimony of $12,000 per year. Judge Tierney
found that the agreement was fair and reasonable
and, accordingly, rendered a judment of dissolution incorporating the agreement. 3
FN3. "The stipulated judgment ordered the
[husband] to pay to the [plaintiff] lump
sum alimony of $150,000, payable in installments of $50,000 by June 28, 1981,
$50,000 by August 28, 1981 . .. and
$50,000 by February 28, 1982 ... together
with nonmodifiable periodic alimony of
$12,000 per year. The [husband] was also
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646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
ordered to pay $15,000 as part of the
[plaintiff's] attorney's fees and to maintain
a $50,000 life insurance policy on his life
owned by the [plaintiff] and payable to
her. The [plaintiff] was ordered to transfer
her one half interest in a business building
at 636 Kings Highway, Fairfield, to the
[husband], the equity in which he claimed
was $50,000. The [plaintiff] was required
to relinquish her claim in the amount of
$27,000 to a certificate of deposit managed
by the [husband]. The [plaintiff] was awarded full ownership of Daniel Oil
[Company], which the [husband's] affidavit claimed produced an income of
$18,000 per year. Works of art valued by
the [husband] at $64,700 were ordered divided between the parties. Otherwise, each
was to retain substantial other assets
shown on their affidavits. The principal asset shown by the [husband's] affidavit
[was] the valuation, after taxes due on liquidation, of his pension plan in Grayson
Associates, Inc., at $340,152 and the principal asset shown by the [plaintiff's] affidavit [was] the former family residence at
15 Berkeley Road, Westport, in which the
claimed equity was $167,000." Grayson v.
Grayson, 4 Conn.App. 275, 277-78, 494
A.2d 576 (1985).
**198 *171 On September 23, 1981, the
plaintiff moved to open the judgment on the ground
that the settlement agreement had been based on a
fraudulent affidavit submitted to the court and to
the plaintiff ~her husband. FN4 The trial court,
Jacobson, J., 5 denied the plaintiff's motion to
open the judgment and the plaintiff appealed to the
Appellate Court, which affirmed the judgment.
Grayson v. Grayson, 4 Conn.App. 275, 494 A.2d
576 (1985), appeal dismissed, 202 Conn. 221, 520
A.2d 225 (1987).
FN4. The pertinent portions of that affidavit, and other facts relevant to the maritPageS
al dissolution action, are set forth in
Grayson v. Grayson, supra, 4 Conn.App.
275, 494 A.2d 576.
FNS. The plaintiff's motion to open the
marital dissolution judgment was heard
and decided by Judge Jacobson. Unless
otherwise indicated, references in this
opinion to the trial court are to Judge Ballen.
The plaintiff also brought this legal malpractice
action against the defendants. Her complaint alleged that she had agreed to the settlement of the
dissolution action on the advice of the defendants
who, she claimed, had failed properly to prepare
her case. The plaintiff further alleged that as a result of the defendants' negligence, she had agreed to
a settlement that "was not reflective of her legal entitlement" and that she had "thereby sustained an
actual economic loss."
At trial, the plaintiff introduced evidence concerning her thirty year marriage, its breakdown due
to her husband's affair with another woman, and the
couple's *172 fmancial circumstances. After a detailed recounting of the history of the divorce litigation, the plaintiff presented the testimony of two
expert witnesses, Thomas Hupp, a certified public
accountant, and Donald Cantor, an attorney who
specialized in the practice of family law.
Hupp testified that the defendants had failed
properly to value the marital estate and, in particular, the husband's various business interests. Cantor
gave his opinion that the defendants' representation
of the plaintiff fell below the standard of care required of attorneys in marital dissolution cases.
Specifically, Cantor testified that: (1) the defendants had not conducted an adequate investigation
and evaluation of the husband's business interests
and assets; (2) they had not properly prepared for
trial; (3) as a result of the defendants' negligence,
the plaintiff had agreed to a distribution of the marital estate and an alimony award that were not fair
and equitable under the law; see General Statutes
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
§§ 46b-81(c) FN6 and 46b-82; FN? and (4) the
**199 plaintiff *173 would have received a greater
distribution of the marital estate and additional alimony had she been competently represented. The
trial court, Ballen, J., denied the defendants' motion
for a directed verdict at the close of the plaintiffs
case.
FN6. General Statutes § 46b-81(c)
provides in relevant part: "In fixing the
nature and value of the property, if any, to
be assigned, the court, after hearing the
witnesses, if any, of each party ... shall
consider the length of the marriage, the
causes for the annulment, dissolution of
the marriage or legal separation, the age,
health, station, occupation, amount and
sources of income, vocational skills, employability, estate, liabilities and needs of
each of the parties and the opportunity of
each for future acquisition of capital assets
and income. The court shall also consider
the contribution of each of the parties in
the acquisition, preservation or appreciation in value of their respective estates."
FN7. General Statutes § 46b-82 provides
in relevant part: "In determining whether
alimony shall be awarded, and the duration
and amount of the award, the court shall
hear the witnesses, if any, of each party ...
shall consider the length of the marriage,
the causes for the annulment, dissolution
of the marriage or legal separation, the age,
health, station, occupation, amount and
sources of income, vocational skills, employability, estate and needs of each of the
parties and the award, if any, which the
court may make pursuant to section 46b-81
, and, in the case of a parent to whom the
custody of minor children has been awarded, the desirability of such parent's securing employment."
In their case in defense, the defendants testified
concerning their handling of the plaintiffs case, and
Page6
they also presented the expert testimony of two attorneys, James Stapleton and James Greenfield.
These experts expressed the opinion that the defendants' representation of the plaintiff comported
with the standard of care required of attorneys conducting dissolution litigation.
The jury returned a verdict for the plaintiff in
the amount of $1,500,000. The defendants thereafter filed motions to set aside the verdict and for
judgment notwithstanding the verdict. The trial
court denied those motions and rendered judgment
in accordance with the verdict. Additional facts are
set forth as relevant.
I
[1] The defendants first claim that the trial
court improperly denied their motions for a directed
verdict and for judgment notwithstanding the verdict on the ground that the plaintiff was barred from
recovering against them, as a matter of law, due to
her agreement to settle the marital dissolution action. We conclude that the plaintiff was not so
barred.
The defendants urge us to adopt a common law
rule whereby an attorney may not be held liable for
negligently advising a client to enter into a settlement agreement. See Muhammad v. Strassburger,
McKenna, Messer, Shi/obod & Gutnick, 526 Pa.
541, 587 A.2d 1346 (1991). They argue that, as a
matter of public policy, an attorney should not be
held accountable for improperly advising a client to
settle a case unless that advice *174 is the product
of fraudulent or egregious misconduct by the attorney. See id. The defendants contend that the adoption of such a rule is necessary in order to promote
settlements, to protect the integrity of stipulated
judgments, and to avoid the inevitable flood of litigation that they claim will otherwise result. They
claim that such a rule is particularly appropriate if,
as here, the court has reviewed and approved the
settlement agreement.
We have long recognized that the pretrial settlement of claims is to be encouraged because, in
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168,646 A.2d 195)
the vast number of cases, an amicable resolution of
the dispute is in the best interests of all concerned.
"The efficient administration of the courts is subserved by the ending of disputes without the delay
and expense of a trial, and the philosophy or ideal
of justice is served in the amicable solution of controversies." Krattenstein v. G. Fox & Co., 155
Conn. 609, 614, 236 A.2d 466 (1967). We have
also acknowledged that, with appropriate judicial
supervision, the "private settlement of the financial
affairs of estranged marital partners is a goal that
courts should support rather than undermine."
Hayes v. Beresford, 184 Conn. 558, 568, 440 A.2d
224 (1981); Baker v. Baker, 187 Conn. 315,
321-22, 445 A.2d 912 (1982). At a time when our
courts confront an unprecedented volume of litigation, we reaffirm our strong support for the implementation of policies and procedures that encourage fair and amicable pretrial settlements.
[2] We reject the invitation of the defendants,
however, to adopt a rule that promotes the finality
of settlements and judgments at the expense of a
client who, in reasonable reliance on the advice of
his or her attorney, agrees to a settlement only to
discover that the attorney had failed to exercise the
degree of skill and learning required of attorneys in
the circumstances. "Although we encourage settlements, we recognize that litigants *175 rely heavily
on the professional advice of counsel when they decide whether to accept or reject offers of settlement,
and we insist that the lawyers of our state advise
clients with respect to settlements with the same
skill, knowledge, and diligence with which they
pursue all other legal tasks." Ziegelheim v. Apollo,
128 N.J. 250, 263, 607 A.2d 1298 (1992). Therefore, when it has been established that an attorney,
in advising a client concerning the settlement of an
action, has failed to "exercise that degree of skill
and learning commonly applied under all the circumstances in the community by the average**200
prudent reputable member of the [legal] profession
... [and that conduct has] result[ed in] injury, loss,
or damage to the [client]"; (internal quotation
marks omitted) Davis v. Margolis, 215 Conn. 408,
Page7
415, 576 A.2d 489 (1990); the client is entitled to a
recovery against the attorney. Accordingly, like the
majority of courts that have addressed this issue,
we decline to adopt a rule that insulates attorneys
from exposure to malpractice claims arising from
their negligence in settled cases if the attorney's
conduct has damaged the client. See Edmondson v.
Dressman, 469 So.2d 571 (Ala.l985); Bill Branch
Chevrolet, Inc. v. Burnett, 555 So.2d 455
(Fla.App.1990); McCarthy v. Pedersen & Houpt,
250 Ill.App.3d 166, 190 Ill.Dec. 228, 621 N.E.2d
97 (1993); Braud v. New England Ins. Co., 534
So.2d 13 (La.App.l988); Fishman v. Brooks, 396
Mass. 643, 487 N.E.2d 1377 (1986); Lowman v.
Karp, 190 Mich.App. 448, 476 N.W.2d 428 (1991);
Ziegelheim v. Apollo, supra, 128 N.J. 250, 607 A.2d
1298; Cohen v. Lipsig, 92 A.D.2d 536, 459
N.Y.S.2d 98 (1983); but see Muhammad v. Strassburger, McKenna, Messer, Shilobod & Gutnick,
supra, 526 Pa. 541, 587 A.2d 1346.
Furthermore, we do not believe that a different
result is required because a judge had approved the
settlement of the plaintiff's marital dissolution action. Although in dissolution cases "[t]he presiding
judge has *176 the obligation to conduct a searching inquiry to make sure that the settlement agreement is substantively fair and has been knowingly
negotiated"; Hayes v. Beresford, supra, 184 Conn.
at 568, 440 A.2d 224; Baker v. Baker, supra, 187
Conn. at 321, 445 A.2d 912; see General Statutes §
46b-66; the court's inquiry does not serve as a substitute for the diligent investigation and preparation
for which counsel is responsible. See Monroe v.
Monroe, 177 Conn. 173, 183, 413 A.2d 819, appeal
dismissed, 444 U.S. 801, 100 S.Ct. 20, 62 L.Ed.2d
14 (1979) ("lawyers who represent clients in matrimonial dissolutions have a special responsibility for
full and fair disclosure, for a searching dialogue,
about all of the facts that materially affect the client's rights and interests"). Indeed, the dissolution
court may be unable to elicit the information necessary to make a fully informed evaluation of the settlement agreement if counsel for either of the
parties has failed properly to discover and analyze
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
the facts that are relevant to a fair and equitable settlement.
Finally, we do not share the concern expressed
by the defendants about the impact that our resolution of this issue will have on settlements, stipulated judgments, and the volume of litigation. Indeed, the defendants do not suggest that attorneys
have heretofore bee~ unwilling to recommend settlements out of concern over possible malpractice
suits, for attorneys in this state have never been insulated from negligence claims by the protectional
rule urged by the defendants. Because settlements
will often be in their clients' best interests, we harbor no doubt that attorneys will continue to give advice concerning the resolution of cases in a manner
consistent with their professional and ethical responsibilities.
We similarly reject the defendants' prediction
of a dramatic increase in legal malpractice claims
by parties to marital dissolution actions who, after
judgment, have become disenchanted with the settlement agreementsnegotiated *177 by their attorneys. Again, we have no reason to believe that our
resolution of the defendants' claim will prompt an
increase in malpractice suits against attorneys because, in declining to narrow the existing common
law remedy for attorney malpractice, we create no
new claim or theory of recovery. Moreover, as the
New Jersey Supreme Court has recently stated in
response to the same concern expressed by the defendants here, "plaintiffs must allege particular
facts in support of their claims of attorney incompetence and may not litigate complaints containing
mere generalized assertions of malpractice. We are
mindful that attorneys cannot be held liable simply
because they are not successful in persuading an
opposing party to accept certain terms. Similarly,
we acknowledge that attorneys who pursue reasonable strategies in handling their cases and who
render reasonable advice to their clients cannot be
held liable for the failure of their strategies or for
any unprofitable outcomes that result because their
clients took their advice. The **201 law demands
Page 8
that attorneys handle their cases with knowledge,
skill, and diligence, but it does not demand that
they be perfect or infallible, and it does not demand
that they always secure optimum outcomes for their
clients." Ziegelheim v. Apollo, supra, 128 N.J. at
267, 607 A.2d 1298.
We believe, therefore, that the rule proposed by
the defendants is neither necessary nor advisable.
Accordingly, we conclude that a client who has
agreed to the settlement of an action is not barred
from recovering against his or her attorney for malpractice if the client can establish that the settlement agreement was the product of the attorney's
negligence.
II
The defendants next claim that the evidence
was insufficient to support the jury's verdict with
respect to both liability and damages and, therefore,
that the *178 trial court improperly denied their
motions to set aside the verdict and for judgment
notwithstanding the verdict. We disagree.
[3] It is well established that "[w]e undertake
only limited appellate review of a trial court's denial of a motion for judgment notwithstanding the
verdict and of a motion to set aside the verdict. In
each case, we accord great deference to the trial
court's superior opportunity to view the trial in its
entirety. In reviewing the decision of the trial court,
we consider the evidence in the light most favorable to the sustaining of the verdict.... Our function
is to determine whether the trial court abused its
discretion in denying [either] motion.... The trial
court's [denial of each motion] is entitled to great
weight and every reasonable presumption should be
indulged in favor of its correctness .... " (Citations
omitted; internal quotation marks omitted.)
Blanchette v. Barrett, 229 Conn. 256, 264, 640
A.2d 74 (1994). With these principles in mind, we
address the defendants' claims of evidentiary insufficiency.
A
[ 4] The defendants contend that the evidence
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Coon. 168, 646 A.2d 195)
does not support a determination that they were deficient in their representation of the plaintiff. They
also claim that the plaintiffs evidence was so speculative that a jury reasonably could not have concluded that the defendants' conduct was the proximate cause of any economic harm to the plaintiff. We
disagree.
The following evidence, which the jury could
have credited, is relevant to these claims. At the
time of the trial of the marital dissolution action,
the plaintiff and her husband had been married for
thirty years. The plaintiff, fifty-three years old, was
a graduate of Simmons College, and for eight years
had owned and operated her own real estate business. Prior to opening her *179 real estate office,
the plaintiff had remained at home to raise the
couple's three daughters. Her husband, a fifty-six
year old graduate of the Wharton School of Finance
and Columbia Law School, was a successful entrepreneur.
Among her husband's business interests were
several bowling alleys. He held a 20 percent general partnership interest in Nutmeg Bowl, Colonial
Lanes and Laurel Lanes, and was in charge of their
management. In addition, he owned 100 percent of
the stock in three lounges that served food and
beverages to patrons of the bowling alleys. The
husband also had a beneficial interest in the
Grayson Associates Pension and Profit Sharing
Plan, which in turn was a limited partner in the
three bowling alleys.
Grayson Associates, Inc., a management company in which the husband was the sole shareholder, received management fees from the three bowling alleys. Although Grayson Associates had a fair
market value of $487,000, the husband's financial
affidavit listed only its book value of $14,951. The
husband's fmancial affidavit also listed a $46,080
limited partnership interest in Georgetown at Enfield Associates (Georgetown partnership), and a
future general partnership interest in that partnership of $959.76. The husband's affidavit failed to
disclose, however, that he intended to take a
Page9
$185,000 partnership distribution from the Georgetown partnership and that he was entitled to
$45,000 in management**202 fees from that partnership. FN8 To the contrary, the affidavit affumatively represented that the husband would receive no
future income from the Georgetown partnership. Finally, the husband's affidavit indicated an annual
income of approximately $62,000.
FN8. The husband's partner in the Georgetown partnership, Leslie Barth, testified
that, at the time of the dissolution trial, the
husband planned to take a partnership distribution of$185,000 from the Georgetown
partnership, and that the partnership also
owed the husband $45,000 in management
fees.
*180 The plaintiffs fmancial affidavit, which
was prepared by the defendants in consultation with
the plaintiff, indicated that she had no income. The
plaintiff had testified at her deposition prior to the
dissolution trial, however, that she earned approximately $25,000 annually from her real estate business, and that she expected to receive commissions
in excess of$34,000 in 1981.
The plaintiff's expert witness Cantor expressed
his opinion that the defendants had been negligent
in failing properly to discover and evaluate certain
assets of the marital estate.FN9 Specifically, Cantor
testified that the defendants had improperly failed
to: (1) ascertain the full value of the Georgetown
partnership; (2) discover the $165,000 anticipated
distribution to the husband by that partnership; and
(3) discover the $45,000 management fee owed to
the husband by the partnership. Cantor also testified
that because the defendants had failed to obtain appraisals for several of the assets, including 636
Kings Highway and Grayson Associates, Inc., the
defendants were unable to challenge various inconsistencies in the husband's fmancial affidavit. Cantor further testified that the defendants had failed
properly to establish the husband's "residual interest in the bowling alleys ... as a general partner,"
an asset not expressly valued in the husband's affi-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
davit.
FN9. Cantor testified that "[t]he value of
the assets is the prime information that ...
[a lawyer] need[s] to have in order to sit
down and intelligently discuss how the assets will be divided. If you don't have that
information, you are crippled when you sit
down to attempt to negotiate."
Cantor also explained that, in his opinion, the
defendants had failed to exercise due care in the
preparation of the plaintiffs financial affidavit. In
Cantor's judgment, the plaintiffs credibility had
been seriously and unnecessarily compromised because her financial affidavit did not include the income from her real estate business. Cantor also
noted that the plaintiffs credibility may have been
further undermined by virtue of *181 the defendants' submission of three separate documents containing three different valuations of another marital
asset, the Daniel Oil Company.
Cantor expressed his opinion that at the end of
the two days of trial, there was not enough financial
information available to the lawyers to permit them
to responsibly recommend settlement to the
plaintiff. He further concluded that the defendants'
failure to satisfy the standard of skill and care required of attorneys in such cases was the cause of
economic damage to the plaintiff because, in his
view, she would have received a larger distribution
of the marital estate had the defendants represented
her competently.
Finally, Cantor testified to his opinion that the
plaintiff reasonably could have anticipated receiving 40 to 60 percent of the total marital estate,
l'l"iilO whic . h d' th I . ·= 'tn , accor mg to e p amhu s WI esses,
had a value of approximately $2,400,000. Cantor
also opined that the plaintiff reasonably could have
anticipated receiving periodic modifiable alimony
of approximately 35 to 50 percent of the parties'
b. d. FN11 com me mcomes.
FNlO. In support of his opinion, Cantor
Page 10
noted that: ( 1) the plaintiff and her husband had been married for thirty years; (2)
the plaintiff was fifty-three years old; (3)
the evidence indicated that the husband
had committed adultery; and (4) the
plaintiff had contributed significantly to
the marital estate. In Cantor's view, these
were all significant factors to be considered by a court in determining how the
assets of the parties should be divided and
whether alimony should be awarded.
FNll. Cantor testified that if the plaintiff
had received a distribution of the marital
estate that was at the high end of the 40 to
60 percent range, then she could have expected to receive an alimony award that
was at the low end of the 35 to 50 percent
range.
**203 We conclude that the evidence adduced
at trial was sufficient to support the jury's determination that the defendants were negligent in their
representation of the plaintiff. The jury reasonably
could have determined, on the basis of the testimony of the plaintiffs expert, that the defendants
had negligently failed to *182 discover and value
the husband's business interests and related assets,
and that the terms of the settlement agreement did
not represent a fair and equitable distribution of the
true marital estate. Moreover, the jury was entitled
to credit Cantor's testimony that the defendants' advice to accept the settlement agreement was the
product of their inadequate investigation and preparation.
[5] We further conclude that the evidence supported the jury's determination that the defendants'
negligence was the proximate cause of economic
damage to the plaintiff. "[T]he test of proximate
cause is whether the defendant's conduct is a substantial factor in bringing about the plaintiffs injuries.... The existence of the proximate cause of an
injury is determined by looking from the injury to
the negligent act complained of for the necessary
causal connection." (Citations omitted; internal
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168,646 A2d 195)
quotation marks omitted.) Wu v. Fairfield, 204
Conn. 435, 438, 528 A.2d 364 (1987). Cantor testified that competent counsel would not have advised
the plaintiff to enter into the settlement agreement,
and that she would have received a significantly
greater distribution of the marital estate had she
been properly represented. Although the defendants
vigorously contested this testimony, the jury was
entitled to credit it. In view of that testimony, we
cannot say that the jury necessarily resorted to conjecture, surmise or speculation in reaching its verdict. ld.; Pisel v. Stamford Hospital, 180 Conn. 314,
340, 430 A.2d 1 (1980); Slepski v. Williams Ford,
Inc., 170 Conn. 18, 22, 364 A.2d 175 (1975). The
jury reasonably could have concluded, therefore,
that the defendants' negligence was the proximate
cause of economic harm to the plaintiff.
B
[6] The defendants further claim that the jury's
verdict was excessive as a matter of law. We do not
agree.
*183 The jury could have credited the testimony of the plaintiff's witnesses that the value of
the marital estate, at the time of the divorce, was
approximately $2,400,000, and that the value of the
plaintiff's distribution, under the terms of the stipulated judgment, was approximately $450,000. Because the jury could have concluded, as Cantor testified, that the plaintiff reasonably could have expected to receive up to 60 percent of the value of
the marital estate, namely, $1,400,000, the jury also
could have determined that the plaintiff, had she
been competently represented, would have received
approximately $1,000,000 more of the estate's assets than she had been awarded pursuant to the stipulated judgment. In addition, on the basis of Cantor's testimony that the plaintiff could have expected to receive alimony of between 35 and 50 percent of the parties' combined annual income, the
jury reasonably could have concluded that the
plaintiff would have received alimony of up to
$35,000 more per year than she had agreed to in
settlement of the marital dissolution action. FNl2
Page 11
Furthermore, the jury was free to have calculated
the economic damage to the plaintiff in lost alimony from the date of the marital dissolution action
in 1981 indefinitely in to the plaintiff's future.
Viewed in the light most favorable to the plaintiff,
therefore, the evidence supported the jury's verdict
of$1,500,000.
FN12. Although the husband's fmancial affidavit listed annual income of approximately $62,000, the jury could have concluded, based on the testimony of the
plaintiff's witnesses, that the husband's annual income was as much as twice that
amount.
"Litigants have a constitutional right to have
factual issues resolved by the jury .... This right embraces the determination of damages when there is
room for a reasonable difference of opinion among
fair-minded persons as to the amount that should be
awarded.... The amount of a damage award is a
matter peculiarly within the province of the trier of
fact, in this case, the *184 jury .... The size of the
verdict alone does not determine whether it is excessive. The only practical test to apply to this verdict is whether **204 the size of the verdict so
shocks the sense of justice as to compel the conclusion that the jury was influenced by partiality, prejudice, mistake or corruption." (Citations omitted;
internal quotation marks omitted.) Mather v. Griffin
Hospital, 207 Conn. 125, 138-39, 540 A.2d 666
(1988); see also Bartholomew v. Schweizer, 217
Conn. 671, 687, 587 A.2d 1014 (1991).
Because the jury reasonably could have concluded that the defendants' negligence caused economic damage to the plaintiff in the amount of
$1,500,000, the verdict was not excessive as a matter of law. Therefore, the defendants' claim that the
trial court improperly denied their motions to set
aside the verdict and for judgment notwithstanding
the verdict must fail.
III
The defendants also claim that the trial court's
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
rulings on several evidentiary issues require reversal of the judgment against them. Specifically,
the defendants contend that the trial court improperly permitted the plaintiff to introduce: (1) testimony concerning the defendants' failure to seek an
order of alimony pendente lite; (2) testimony concerning the attitude toward women held by the dissolution court; (3) expert testimony concerning the
defendants' failure to discover certain of the husband's undisclosed assets; and (4) certain decisions
issued by the trial court'l Jacobson, J., the Appellate
Court and this court. FN 3
FN13. The defendants also claim that the
trial court improperly permitted the
plaintiff's expert to testify that the defendants had negligently failed to bring to the
attention of the dissolution court evidence
of the husband's adultery. We do not address this claim because the defendants
failed to object to the testimony in the trial
court. See Practice Book§ 4185.
Our role in reviewing evidentiary rulings of the
trial court is settled. "This court has consistently
held that *185 trial courts are vested with broad
discretion in rulings on relevancy and every reasonable presumption must be given in favor of the
court's ruling .... Evidence is relevant if it tends to
establish a fact in issue or corroborates other direct
evidence.... Rulings on such matters will be disturbed on appeal only upon a showing of a clear abuse of discretion." (Citations omitted; internal quotation marks omitted.) Holy Trinity Church of God
in Christ v. Aetna Casualty & Surety Co., 214
Conn. 216, 222, 571 A.2d 107 (1990). We conclude
that the trial court acted within its discretion in permitting the introduction of the challenged evidence.
A
[7] The defendants first claim that the trial
court improperly permitted the plaintiff to testify
that the defendants had failed to seek an order of alimony pendente lite notwithstanding her request
that they do so. The defendants contend that the
testimony was not relevant to any of the plaintiff's
Page 12
claims because Cantor did not testify that the defendants' failure to seek temporary alimony constituted a breach of their duty of care to the plaintiff.
We do not agree.
The trial court could reasonably have concluded that the plaintiff's testimony bore sufficient
relevance to the relationship between the plaintiff
and the defendants, and, in particular, the manner in
which the defendants had responded to her requests, to allow its admission. In that regard, we
have noted that "the fiduciary responsibility of a
lawyer to his client, particularly in matrimonial settlements, requires reasonable inquiry into the
wishes as well as the objective best interests of the
client." (Emphasis added.) Monroe v. Monroe,
supra, 177 Conn. at 183, 413 A.2d 819. In addition,
a motion for temporary alimony that had been filed,
but not pressed, by the defendants, was admitted into evidence without objection. Finally, the defendants have failed to *186 demonstrate that the
plaintiff's testimony was likely to have been unduly
prejudicial, particularly in view of the fact that
I . "ft' 1 d"d k 1 . . FNl4
p amtl s counse 1 not see to exp ott It.
Therefore, we conclude that the trial court did not
abuse its discretion in allowing the plaintiff's testimony concerning the defendants' failure to pursue
her request for alimony pendente lite.
FN14. For example, plaintiff's counsel
made no mention of the testimony in her
closing argument to the jury.
**205 B
[8] The defendants also claim that the trial
court should not have required the defendant K weskin to testify on cross-examination as to whether
he believed that Judge Tierney held the view that
the proper role of a wife was in the home. In view
of other related defense testimony, we disagree.
The defendants' expert Greenfield testified that
in his opinion, Judge Tierney believed that women
should be "modestly taken care of." Greenfield further testified that he considered it to be the responsibility of a matrimonial lawyer to be aware of any
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn.l68,646A.2d 195,63 USLW2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
bias, to the extent possible, of the dissolution court
that might have a bearing on the court's handling of
the marital dissolution action. Moreover, the defendant Margolis had testified that he believed that
Judge Tierney was more likely to believe the husband's testimony than the plaintiffs. In light of this
testimony, Kweskin's beliefs concerning Judge
Tierney's views toward women generally, and
working women in particular, were relevant to the
issue of how the defendants intended to address any
mceived bias he may have held toward women.
15 Under the circumstances presented, therefore,
we conclude*187 that the trial court did not abuse
its discretion in overruling the defendants' objection
to the plaintiffs inquiry.
FN15. After the trial court overruled the
defendants' objection to the plaintiffs
question, Kweskin responded that he did
not know whether Judge Tierney held any
bias toward women, but that if the judge
did have such a bias, he would not have allowed it to affect the exercise of his judgment in the case.
c
[9] The defendants next claim that the trial
court improperly allowed the plaintiffs expert to
testify concerning the defendants' failure to bring to
the attention of the dissolution court certain financial information concerning the Georgetown partnership. The defendants argue that the expert testimony should have been excluded in view of the fact
that (1) testimony about those assets might have
been elicited by the defendants had the marital dissolution trial proceeded to conclusion, but that, in
any event, (2) the defendants' failure to bring the
husband's expectancy interest in the Georgetown
partnership to the attention of the dissolution court
did not, as a matter of law, constitute a breach of
the standard of care owed by the defendants to the
plaintiff. We disagree.
We briefly reiterate the facts relevant to this
claim. On the first day of the marital dissolution trial, the husband filed an affidavit with the court purPage 13
porting to identify his assets. The affidavit stated
that the plaintiff expected no future income from
the Georgetown partnership. In fact, at the time of
the trial, the husband planned to take a distribution
of approximately $185,000 from the Georgetown
partnership, and the partnership owed him $45,000
in management fees. The husband's affidavit did
not contain this information.
The plaintiffs expert, Cantor, testified that the
defendants would have uncovered these interests
had they engaged in proper discovery and conducted a reasonably diligent pretrial investigation. Cantor further testified that the revelation of the husband's interest in these payments was critically important to the dissolution *188 court's evaluation of
the husband's credibility and to the court's determination of the fair and equitable distribution of the
marital estate. The defendants claim that these payments, as mere "expectancies," were irrelevant as a
matter of law to any issue in the marital dissolution
action. On the basis of this premise, the defendants
argue that the dissolution court could not have considered these anticipated payments for any reason
and, therefore, that the testimony of the plaintiffs
expert on the subject was improper.
First, we do not agree with the defendants that
the expert testimony was improperly admitted because there might have been testimony about the
payments if the trial of the marital dissolution action had continued. The trial did not proceed, and
Judge Tierney was not otherwise made aware of the
expected payments when he approved the parties'
settlement agreement. The jury in this case reasonably could have concluded that the dissolution court
would not have approved the agreement had it been
fully and properly **206 apprised of the husband's
true financial circumstances.
Furthermore, we do not believe that the dissolution court was necessarily precluded from consideration of the Georgetown partnership distribution
and management fees. In view of the clear and unequivocal testimony that the husband would receive
the partnership distribution and management fees,
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168,646 A.2d 195)
we cannot conclude that his receipt of the payments
was so speculative or contingent that the trial judge
could not have considered them. See Eslami v. Eslami, 218 Conn. 801, 806-808, 591 A.2d 411
(1991). Moreover, the issue of the relevance and
significance of those anticipated payments was
properly the subject of expert testimony, and the
jury was free to credit the testimony of Cantor on
the issue.
"The requirement of expert testimony in malpractice cases serves to assist lay people, such as
members *189 of the jury and the presiding judge,
to understand the applicable standard of care and to
evaluate the defendant's actions in light of that
standard. Fitzmaurice v. Flynn, 167 Conn. 609,
617, 356 A.2d 887 (1975); Decho v. Shutkin, 144
Conn. 102, 106, 127 A.2d 618 (1956); Bent v.
Green, [39 Conn.Supp. 416, 420, 466 A.2d 322
(1983) ]." Davis v. Margolis, supra, 215 Conn. at
416, 576 A.2d 489.
[10] "The general standard for admissibility of
expert testimony in Connecticut is simply that the
expert must demonstrate a 'special skill or knowledge, beyond the ken of the average juror, that, as
properly applied, would be helpful to the determination of an ultimate issue.' Siladi v. McNamara,
164 Conn. 510, 513, 325 A.2d 277 (1973); see State
v. George, 194 Conn. 361, 373, 481 A.2d 1068
(1984), cert. denied, 469 U.S. 1191, 105 S.Ct. 963,
83 L.Ed.2d 968 (1985). In malpractice cases, the
expert's testimony must be evaluated in terms of its
helpfulness to the trier of fact on the specific issues
of the standard of care and the alleged breach of
that standard. Fitzmaurice v. Flynn, supra at
616-18, 356 A.2d 887 .... Once the threshold question of usefulness to the jury has been satisfied, any
other questions regarding the expert's qualifications
properly go to the weight, and not to the admissibility, of his testimony. Sanderson v. Bob's Coaster
Corporation, 133 Conn. 677, 682, 54 A.2d 270
(1947)." (Citations omitted.) Davis v. Margolis,
supra, 215 Conn. at 416, 576 A.2d 489. Because the
trial court reasonably concluded that the expert
Page 14
testimony would assist the jury to understand the
nature of the defendants' duty to the plaintiff in the
circumstances, the defendants' contention that the
trial court improperly permitted the challenged . . .th . FN16 testunony 1s W1 out ment.
FN16. The defendants make the same
claim in arguing that the trial court improperly failed to direct the jury, in its instructions at the conclusion of the evidence, to disregard Cantor's testimony about
the Georgetown partnership distribution
and management fees. We reject that claim
for the reasons stated above.
*190D
[11] The defendants further claim that the trial
court improperly allowed the plaintiff to introduce
certain written opinions of the trial court, Jacobson,
J., the Appellate Court and this court concerning
the plaintiffs motion to open the marital dissolution
judgment. Under the circumstances of their introduction, we are not persuaded that the admission of
these opinions constituted an abuse of discretion.
The judicial opinions introduced by the
plaintiff consisted of the memorandum of decision
of the trial court, Jacobson, J., dated September 19,
1983, denying the plaintiffs motion to open the
marital dissolution decree; the opinion of the Appellate Court affirming the judgment of the trial
rt FN17 dth . . fthi d .. cou ; an e opm10n o s court 1sm1ssing, as improvidently granted, the plaintiffs petition for certification to a~~eal from the judgment of
the Appellate Court. FN The plaintiff sought the
admission of these opinions in response to the
openiWtltatement to the jury of counsel for Gervasoni, 19 the accountant**207 who had assisted
the defendants in preparing the marital dissolution
I h. · ta FN20 G ., case. n 1s openmg s tement, ervasom s
counsel attacked the plaintiff for *191 seeking to
open **208 the marital dissolution decree and for
appealing the denial of her motion to the Appellate
*192 Court and to this court. The statement, which
included counsel's characterization of the reasons
why the courts had rejected the plaintiffs claim,
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
strongly suggested that each of the decisions constituted a ratification of the settlement agreement and
a rejection of the plaintiffs claim that she had been
ill-advised to enter into it. The trial court did not
abuse its discretion in concluding that the judicial
opinions in question were admissible as a relevant
response to Gervasoni's opening statement to the . FN21 JUry.
FN17. Grayson v. Grayson, supra, 4
Conn.App. 275, 494 A.2d 576.
FN18. Grayson v. Grayson, supra, 202
Conn. 221, 520 A.2d 225.
FN19. See footnote 1.
FN20. The relevant portions of the opening
statement of counsel for Gervasoni are as
follows:
" [After reaching a settlement, the
parties] said this is what we have decided, they read [the agreement] into the
record and [the trial judge,] Judge Tierney, said, I approve it, because he too
knew that it was a favorable settlement
for Mrs. Grayson.
"And the evidence will show that the
court put its stamp of approval on it, and
the evidence will show that that dissolution action then became a matter of record. And the settlement became final.
"Now, that didn't satisfy Mrs. Grayson.
She wasn't really even at this point satisfied with what she had managed to get in
the settlement. She decided at this point
that she didn't get enough, that she
should have had more, and the evidence
will show that she then went back into
this court, not now yet against her attorneys or her accountants, but she went
back into the court seeking to overthrow
the settlement, seeking to set it aside,
and the evidence will show that that's a
Page 15
very rare occurrence, and that's where
Judge Burton Jacobson comes in ....
"Judge Jacobson, again, a respected
judge . . . had this case brought before
him when he was sitting in this very
courthouse as a judge, and the claim
there by Mrs. Grayson was that this case
should be, that this settlement should be
overturned because she didn't know, she
didn't get enough, she was unhappy with
it, her husband was too wealthy, he got
too good a deal, it should be started all
over again.
"Judge Jacobson heard the case, as he
was obligated to do. Whether he thought
it was a bad case or a good case, everybody has a right to bring a suit in court
and have it decided, and another trial
took place, this time without a jury before Judge Jacobson, in this very building. The evidence will show that he
listened to that trial and refused to reopen the case or do anything about it.
Because he felt that, as he decided finally, that the settlement was a fair settlement and that there was no reason to
disturb this settlement, throw it out, start
all over, do anything about it.
"So, again, this hearing again from the
Superior Court at Stamford, again before
Judge-Superior Court Judge Jacobson
who says, no, it stands. And the evidence
will then show that now we have two
judges, Judge Tierney, Judge Jacobson
putting their stamp of approval on the
settlement. But Mrs. Grayson still wasn't
happy. It went on yet. She appealed
Judge Jacobson's decision. Didn't like it.
And the appeal then went up to Hartford
to the court known as the Appellate
Court, which the evidence will show is
the immediate appeal court over the Superior Court-we are now in the Superior
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168, 646 A.2d 195, 63 USL W 2198
(Cite as: 231 Conn. 168,646 A.2d 195)
Court-the court known as the Appellate
Court, and the Appellate Court is the
next level.
"So she doesn't like what Judge Jacobson does, up she goes to the Appellate
Court. The Appellate Court held another
hearing, the attorneys had to go up, the
attorneys had to write briefs and file
briefs, then they had to go up to the Appellate Court, and the evidence will
show that that's exactly what happened,
they wrote the briefs on both sides, they
rehashed what happened before Judge
Tierney, they rehashed what happened
before Judge Jacobson, they made their
claims back and forth again and they
went up to the [Appellate] Court, which
consists of three judges who sit on the
bench in a trio really to decide the case,
and these are judges who have appellate
experience, who are selected really to
exercise appeal jurisdiction over the Superior Court. And these three judges,
three of them, looked at the case and
heard it, heard the arguments, and the
court ruled, there is only one decision,
and one majority decision there, and the
court ruled in that majority decision that,
again, there was no fraud, there was no
hiding, there was nothing unfair, there
was no overreaching. So, in effect the
Appellate Court sanctioned and affirmed
and approved of what Judge Tierney had
done and what Judge Jacobson had done.
"Still Mrs. Grayson wasn't satisfied.
Mrs. Grayson then asked for permission
to appeal the Appellate Court ruling, to
go further to the Connecticut Supreme
Court. In this type of case the Connecticut Supreme Court has to grant permission to argue, to take an appeal. The appeal is not automatic as it is for the Appellate Court. She wasn't going to let it
Page 16
go then. She wanted it to go to the Supreme Court of the State of Connecticut.
"The Supreme Court of the State of Connecticut, the evidence will show, after
the filing of some papers and the request
to hear it and the asking for arguments,
refused to hear it on a factual basis.
They, in effect, said we are not going to
hear it; the Appellate Court decision
stands. All right.
"So now we have the trial before Judge
Tierney, the trial before Judge Jacobson,
the Appellate Court, the Supreme Court,
nobody will touch this divorce agreement. Mrs. Grayson still isn't happy, she
is still looking for more money. So then
she turns on her attorneys and her accountants-not going to get anymore
money through the divorce action, not
going to get anything more from her husband, the court systems says, okay, okay,
okay.
"So her next bet, the next level is, now I
think I'll sue the attorneys and I think I'll
sue the accountants, I may get some
money that way. And that's what this
case is about, and that's why we are here
in court and I think that when you listen
to the case, bear in mind the evidence
that is going to be coming out of the
case. The evidence will demonstrate that
her case about being misled or not told
or somehow defrauded is as weak and
insignificant now as it was before Judge
Tierney and Judge Jacobson and the Appellate Court. The fact of the matter is
that the attorneys and the accountants acted well, they acted faithfully, they acted
loyally and they went the last mile for
her. They do not deserve this fate, ladies
and gentlemen, and I would urge that
you listen to the evidence carefully, keep
an open mind until both sides are heard
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646 A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
and I think that you will see this case
and you'll find favorably in favor of the
defendants."
FN21. We note that the defendants made
no objection to the opening statement of
counsel for Gervasoni.
*193 [12] Although relevant, evidence may be
excluded by the trial court if the court determines
that the prejudicial effect of the evidence outweighs
its probative value. Berry v. Loiseau, 223 Conn.
786, 804, 614 A.2d 414 (1992); Russell v. Dean
Witter Reynolds Inc., 200 Conn. 172, 191-92, 510
A.2d 972 (1986). We have identified at least four
circumstances where the prejudicial effect of otherwise admissible evidence may outweigh its probative value: "(1) where the facts offered may unduly
arouse the jury's emotions, hostility or sympathy,
(2) where the proof and answering evidence it provokes may create a side issue that will unduly distract the jury from the main issues, (3) where the
evidence offered and the counterproof will consume
an undue amount of time, and (4) where the [party
against whom the evi~ence has been offered], having no reasonable ground to anticipate the evidence,
is unfairly surprised and unprepared to meet it."
State v. DeMatteo, 186 Conn. 696, 702-703, 443
A.2d 915 (1982); State v. Greene, 209 Conn. 458,
478-79, 551 A.2d 1231 (1988). The defendants
claim that the judicial opinions should have been
excluded because they tended to create a side issue
that was likely to have distracted the jury. They
have articulated no reason, however, why the admission of the opinions was likely to have caused
such a distraction. Moreover, the defendants have
provided no explanation of which specific statements or references in the opinions were likely to
have caused them prejudice, or why. We will not
speculate concerning the prejudicial effect of otherwise relevant evidence when the party challenging
the admission of the evidence on the ground of undue prejudice has failed to identify, with reasonable
particularity, the source of the alleged prejudice and
the reason why the evidence was likely to have
Page 17
been prejudicial. See Pet v. Dept. of Health Services, 228 Conn. 651, 675-76, 638 A.2d 6 (1994).
Accordingly, the defendants' claim must fail.
*194 IV
[13] The defendants also challenge the trial
court's instructions to the jury, claiming that they
were fundamentally inadequate because the court
improperly failed to relate the facts of the case to
the applicable law. The defendants, however, did
not request that the trial court refer to any specific c. . . . h FN22 d th . 'I I ~acts m 1ts Jury c arge, an ey s1m1 ar y
failed to except to the court's instruction on that
ground. We therefore do not reach the merits of the
defendants' claim. See Practice Book§ 315.FN23
FN22. The defendants initially excepted to
the trial court's failure to instruct the jury
on the Georgetown partnership with greater factual specificity. During the colloquy
following the court's instructions, however,
the defendants expressly withdrew their
exception.
FN23. Practice Book § 315 provides in relevant part: "The supreme court shall not be
bound to consider error as to the giving of,
or the failure to give, an instruction unless
the matter is covered by a written request
to charge or exception has been taken by
the party appealing immediately after the
charge is delivered. Counsel taking the exception shall state distinctly the matter objected to and the ground of objection .... "
[14] We also decline the defendants' invitation
to afford plain error review to this claim. "Review
under the plain error doctrine .. . is reserved for
truly extraordinary situations where the existence of
the error is **209 so obvious that it affects the fairness and integrity of and public confidence in the
judicial proceedings." (Citations omitted; internal
quotation marks omitted.) State v. Hinckley, 198
Conn. 77, 87-88, 502 A.2d 388 (1985); Williamson
v. Commissioner of Transportation, 209 Conn. 310,
317, 551 A.2d 704 (1988); see Practice Book §
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
646A.2d 195
231 Conn. 168,646 A.2d 195,63 USLW 2198
(Cite as: 231 Conn. 168, 646 A.2d 195)
4185. On the basis of our careful review of the trial , th gh . . . FN24 court s orou Jury mstructwns, we conclude that *195 the defendants' claim of error does
not merit consideration under the plain error doctrine.
FN24. Although we do not reach the merits
of the defendants' unpreserved jury instruction claim, we note that the trial court, in
its jury charge, thoroughly reviewed the allegations of the plaintiff's complaint, identified facts that were not in dispute, explained the roles of the parties' expert witnesses with reference to their testimony,
and otherwise adapted its instructions on
the applicable law to the facts and issues of
the case.
The judgment is affirmed.
In this opinion the other Justices concurred.
Conn.,l994.
Grayson v. Wofsey, Rosen, Kweskin and Kuriansky
231 Conn. 168, 646 A.2d 195, 63 USLW 2198
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page 18
Westlaw,
443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
Supreme Judicial Court of Massachusetts,
Bristol.
Eleanor L. GUENARD
v.
George G. BURKE.
Argued Sept. 16, 1982.
Decided Dec. 30, 1982.
Action was brought in the Superior Court, Bristol County, concerning attorney fee dispute and alleging legal malpractice. Attorney's motion to strike
former client's claim for jury trial as to two counts
of complaint was heard by Silva, J., and counts one
and two were tried before Taveira, J., and motion
for summary judgment on count three was heared
by Ponte, J. The Supreme Judicial Court granted request for direct appellate review and Wilkins, J.,
held that: (1) attorney was entitled to receive fair
and reasonable value of his services, even though
he purported to enter into unlawful contingent fee
agreement with his former client; (2) determination
of amount of fee was jury question; and (3) genuine
issue of material fact existed with respect to attorney's negligence in his representation of former client, precluding summary judgment.
Reversed and remanded.
West Headnotes
[1] Attorney and Client 45 e= 148(1)
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
45k148 Construction and Operation of
Contract
45k148(1) k. In General. Most Cited
Cases
Attorney was entitled to receive fair and reasonable value of his services, even though he purPage 1
ported to enter into unlawful contingent fee agreement with his client in connection with modification of separation agreement which she had entered
into with her husband, since purpose of rule forbidding contingent fee agreement in respect of procuring of divorce to eliminate any inducement to counsel to proceed with divorce rather than to seek reconciliation was not thwarted as decree nisi had
already been entered when client retained attorney.
S.J.C.Rules 3:14, 3:14(3, 4) (1980).
[2] Attorney and Client 45 e= 147
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
45k147 k. Requisites and Validity of Contract. Most Cited Cases
Contingent fee agreement entered into prior to
entry of divorce decree, or judgment, absolute is an
agreement in respect of procuring a divorce and is
forbidden. S.J.C.Rules 3:14, 3:14(3, 4) (1980).
[3] Attorney and Client 45 e= 167(2)
45 Attorney and Client
45IV Compensation
45k157 Actions for Compensation
45kl67 Trial
45k167(2) k. Questions for Jury. Most
Cited Cases
Amount of fee attorney was entitled to receive
for reasonable value of his services was a jury
question in dispute between attorney and former
client.
[4] Trial 388 e= 136(1)
388 Trial
388VI Taking Case or Question from Jury
388VI(A) Questions of Law or of Fact in
General _,
388kl36 Questions of Law or Fact in
General
388k136(1) k. In General. Most Cited
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802,443 N.E.2d 892)
Cases
When jury claim is seasonably made factual issue should be submitted to jury.
[5) Attorney and Client 45 E? 148(1)
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
45kl48 Construction and Operation of
Contract
45k148(1) k. In General. Most Cited
Cases
(Formerly 45k32)
Attorney and Client 45 E? 148(3)
45 Attorney and Client
45IV Compensation
45k146 Contingent Fees
45k148 Construction and Operation of
Contract
45k148(3) k. Amount of Fee. Most
Cited Cases
Because purported contingent fee agreement
entered into in connection with modification of separation agreement, which former client had entered
into with her husband, was unenforceable due to
fact that attorney did not sign agreement, his reliance on that agreement to justify amount of his fee
was improper and his reliance on agreement made
in violation of court rules was an unfair or deceptive act or practice; however, matter of relief had to
await since the Supreme Judicial Court could not
tell whether former client sustained loss of money
or property as a result of attorney's reliance on contingent fee agreement. M.G.L.A. c. 93A, §§ 2, 2(a),
9(1); S.J.C.Rule 3:14 (1980).
[6) Interest 219 E? 19(3)
219 Interest
2191 Rights and Liabilities in General
219k19 Demands Not Liquidated
219k19(3) k. Principal in Dispute. Most
Cited Cases
Page2
Attorney who acted in good faith where there
was honest controversy between parties as to attorney fees would not be liable for interest penalty.
M.G.L.A. c. 221, § 51.
[7) Attorney and Client 45 E? 167(2)
45 Attorney and Client
45IV Compensation
45k157 Actions for Compensation
45k167 Trial
45k167(2) k. Questions for Jury. Most
Cited Cases
Interest 219 E? 68
219 Interest
219IV Recovery
219k68 k. Questions for Jury. Most Cited
Cases
In dispute over attorney fees, claim of former
client's right to interest and multiple damages for
loss of use of her money due to alleged unlawful
contingent fee agreement was jury question.
M.G.L.A. c. 93A, § 9(3, 4); c. 221, §51; S.J.C.Rule
3:14 (1980).
[8) Judgment 228 E? 181(16)
228 Judgment
228V On Motion or Summary Proceeding
228k181 Grounds for Summary Judgment
228k181(15) Particular Cases
228k181(16) k. Attorneys, Cases Involving. Most Cited Cases
In legal malpractice action, genuine issue of
material fact existed concerning attorney's alleged
negligence in his representation of former client,
precluding summary judgment.
[9) Judgment 228 E? 186
228 Judgment
228V On Motion or Summary Proceeding
228k182 Motion or Other Application
228k186 k. Hearing and Determination.
Most Cited Cases
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
Deposition and contrary affidavit must both be
considered in passing on motion for summary judgment.
(10) Judgment 228 €= 185.3(4)
228 Judgment
228V On Motion or Summary Proceeding
228kl82 Motion or Other Application
228kl85.3 Evidence and Affidavits in
Particular Cases
228kl85.3(4) k. Attorneys. Most Cited
Cases
Admission in former client's deposition taken
in connection with legal malpractice action was not
binding on her in light of contrary affidavit filed
with court.
**893 *803 Edward T. Troy, Mansfield, for
plaintiff.
John P. Ryan, Plymouth, and Jeffrey C. LaPointe,
Quincy, for defendant.
Before *802 WILKINS, ABRAMS, NOLAN,
LYNCH and O'CONNOR, JJ.
WILKINS, Justice.
We are presented with a contest between an attorney and his former client. One aspect of the dispute concerns whether the attorney is entitled to
any fee as a result of his representation of his client
in connection with the modification of a separation
agreement which she had entered into with her husband. We conclude that, in the circumstances, the
attorney is entitled to receive the fair and reasonable value of his services, even though he purported
to enter into an unlawful contingent fee agreement
with his client, and that the determination of the
amount of his fee is a question that should have
been submitted to a jury. Only after a determination
of the amount of the attorney's reasonable fee will it
be possible to determine whether the former client
is entitled to multiple damages for the attorney's
failure to pay over funds he received from his eliPage3
ent's former husband. A further aspect of the dispute involves the former client's claim of malpractice against the attorney in which she asserts that
the attorney was negligent in his representation of
her in connection with the modification of the separation agreement. This issue was decided against
the client on the attorney's motion for summary
judgment. We reverse the judgments.
The issues for our decision arise in the following circumstances. On June 24, 1974, a decree nisi
(now called a judgment nisi) was entered in favor
of Raymond 0. Guenard in his divorce action
against the plaintiff. The plaintiff was then represented by counsel other than the defendant. On the
same day, the parties executed a separation agreement, *804 which was not incorporated in the decree. The husband agreed to pay the plaintiff $195 a
week until her death, her remarriage, or his death.
The husband also agreed to pay the plaintiff the
greater of $30,000 or one half of the net equity on
the sale of certain real estate.
In October or November, 1974, the plaintiff,
dissatisfied with the settlement, consulted the defendant attorney. On December 6, 1974, shortly before the decree of divorce would have become absolute, the defendant filed a petition on the wife's
behalf in the Probate Court for the county of Norfolk challenging the decree nisi on the ground that
it was obtained by fraud, unilateral mistake, and coercion. Counsel for her husband took the plaintiffs
deposition in which she stated that she had signed
the original agreement voluntarily and that she had
not been coerced or threatened into accepting the
settlement. In May, 1975, the plaintiff paid a retainer of $1,075 to the defendant. On June 12, 1975, the
plaintiff executed a purported contingent fee agreement in which she agreed to pay the defendant
"one-third of any recovery received on my behalf
relative to the divorce action commenced" against
her or received by her relative to her objections to
the divorce. The defendant did not sign the purported agreement.
After negotiations, in August, 1975, the hus-
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443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
band and wife executed an amendment to the separation agreement. It provided for the immediate payment of an additional $30,000 to the plaintiff and
for the continuance of the husband's weekly alimony obligations **894 after his death. The
plaintiff withdrew her objections and a decree absolute of divorce was entered. In September, 1975,
the defendant sent the plaintiff a check in the
amount of $20,000, "representing the net amount
due you after the deduction of my one-third legal
fee." The defendant did not attempt to base his fee
also on the value to the plaintiff of her right to receive alimony if she should survive her husband
and remain unmarried.
The plaintiff, once again dissatisfied, consulted
her present counsel concerning her rights. In April,
1978, the plaintiff*805 made a demand under G.L.
c. 93A for the payment of the $10,000 received by
the defendant and for an "[i]temization of fee
charged" against the retainer. In the present action,
commenced in June, 1978, the plaintiff challenges
the defendant's right to receive any fee for his services on the ground that the contingent fee agreement violated that portion of S.J.C. Rule 3:14(3),
351 Mass. 795 (1967), which prohibited a contingent fee amement "in respect of the procuring of a
·divorce." 1 The plaintiff also alleged that the
contingent fee agreement was unlawful under G.L.
c. 93A, § 2, and that she was entitled to relief under
G.L. c. 93A, § 9. The plaintiff asserted, under
counts one and two, a claim for multiple interest on
the withheld funds, relying on G.L. c. 221, § 51.
The defendant counterclaimed for an additional
$4,000 in legal fees. Subsequently, the plaintiff
amended her complaint to add a third count alleging that the defendant negligently represented
her in connection with the modification of the separation agreement.
FNl. This rule now appears as S.J.C. Rule
3:05, as amended, Mass. (1981).
The defendant moved to strike the plaintiffs
claim of a jury trial on the first and second counts
of her complaint. A judge allowed that motion.
Page4
These two counts went to trial before a different
judge without a jury and resulted in a judgment for
the defendant on both counts. FN2 The judge concluded that the purported contingent fee agreement
violated S.J.C. Rule 3:14, that the defendant was
entitled to a fee based on the fair value of his services even if he had violated S.J.C. Rule 3:14, and
that the amount ($11,075) the defendant had
already received was reasonable to compensate him
for his services and expenses. He concluded that the
plaintiff was not entitled to recover under G.L. c.
93A. The plaintiff appeals from the judgment for
the defendant on counts one and two of the complaint.FN3 We *806 granted the plaintiffs application for direct appellate review.
FN2. The defendant stipulated that he
would not press his counterclaim if he
were successful on the first two counts of
the complaint.
FN3. We leave to later a presentation of
the circumstances relating to the propriety
of the entry of summary judgment for the
defendant on count three, the malpractice
claim.
[ 1] 1. The trial judge correctly concluded that
the defendant's violation of S.J.C. Rule 3:14 did not
bar him from receiving any fee for his services.
FN4 He was also correct in concluding that the defendant was entitled to a fee based on the fair value
of his services.
FN4. This rule (see now S.J.C. Rule 3:05,
as amended, Mass. [1981] ), authorized
written contingent fee agreements as to the
attorney's fees in certain instances. Each
copy of the agreement "shall be signed
both by the attorney and by each client."
S.J.C. Rule 3:14(4), 351 Mass. 795 (1967).
"No contingent fee agreement shall be
made ... (b) in respect of the procuring of a
divorce, annulment of marriage or legal
separation." S.J.C. Rule 3:14(3).
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443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802,443 N.E.2d 892)
The defendant does not now rely on the contingent fee agreement to support his claim for a fee
but rather argues that he was entitled to a fair and
reasonable fee. We have held that an attorney is not
barred from recovering the fair value of his services
simply because a client failed to sign a purported
contingent fee agreement. Young v. Southgate Dev.
Corp., 379 Mass. 523, 525-526, 399 N.E.2d 27
(1980). Where the client has signed such an agreement, but the attorney has not, there is even less
reason to deny the attorney the right to receive a
reasonable fee. Rule 3:14 was adopted to protect
the interests of clients and the public, not as a trap
to deny an **895 attorney a reasonable fee whenever a purported contingent fee agreement is unenforceable.
A more substantial question arises from the
plaintiffs claim that the contingent fee agreement
violated the prohibition against contingent fee
agreements "in respect of the procuring of a divorce." Such a prohibition is the majority rule in
this country. See Mcinerney v. Massasoit Greyhound Ass'n, 359 Mass. 339, 350, 269 N.E.2d 211
(1971); Annot., 93 A.L.R.3d 523, 526 (1979). The
prohibition is designed primarily to encourage reconciliation by removing any incentive to the attorney to press forward with the divorce and, secondarily, to assure that the court will be able to make a
fully informed equitable property settlement. Mcinerney v. Massasoit Greyhound Ass'n, supra at
350-351, 269 N.E.2d 211.
*807 [2] We agree with the trial judge that a
contingent fee agreement entered into prior to the
entry of a decree, or judgment, absolute is an agreement "in respect of the procuring of a divorce" and
is forbidden by S.J.C. Rule 3:14(3) (now S.J.C.
Rule 3:05[3] ). The rule applies to both parties to a
divorce action, not only to the party seeking the divorce. The rule does not depend on the client's financial ability to obtain representation without such
an agreement. The better course is to apply the rule
literally and not to open up consideration of the
facts of a particular case to see whether the purPageS
poses of the rule have or have not been thwarted by
a literal violation of the rule. If the rule sweeps too
broadly in its application, the appropriate solution
is to amend the rule, not to modify it by judicial interpretation. Because the defendant did not sign a
copy of the purported contingent fee agreement, it
was not, in any event, a valid agreement, even if the
agreement had not been "in respect of the procuring
of a divorce."
When, however, we come to the issue whether
the defendant is entitled to a fair and reasonable fee
despite the violation of rule 3:14(3), the nature of
the violation and its degree of seriousness are relevant. Here, a decree nisi had already been entered
when the plaintiff retained the defendant. The dispute was over a property settlement, not the divorce
as such. There is nothing in the record to show that
either party to the divorce action had the slightest
interest in reconciliation. Thus, on the facts, the
purpose of rule 3:14 to eliminate any inducement to
counsel to proceed with the divorce rather than to
seek reconciliation was not thwarted. On the other
hand, the further purpose of the rule to have an informed judicial approval of any property settlement
may have been thwarted. The record does not show
whether the Probate Court judge who approved the
amended agreement knew of the fee arrangement
between the plaintiff and the defendant.
We see no reasonable basis for denying the defendant a fair and reasonable fee in these circumstances. We are not dealing here with a violation of
a prohibition against representation *808 of a client.
See Misci v. Revere Hous. Auth., 359 Mass. 743,
744, 269 N.E.2d 210 (1971); Collins v. Godfrey,
324 Mass. 574, 581, 87 N.E.2d 838 (1949). Therecovery of the fair value of the defendant's services
is warranted under the principles announced in
Town Planning & Eng'g Assocs. v. Amesbury Specialty Co., 369 Mass. 737, 745, 342 N.E.2d 706
(1976). For opinions generally allowing, but some
denying, recovery in quantum meruit in similar
situations, see Annot., 100 A.L.R.2d 1378,
1390-1391 (1965). To allow recovery of the fair
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443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802,443 N.E.2d 892)
value of the defendant's legal services would not
defeat the pwposes of the prohibition in rule 3:14.
Denying enforcement of the contingent fee agreement achieves that object. Representation of the client was not illegal; only the contingent fee agreement was. The loss to the defendant of a reasonable
fee and the windfall to the plaintiff in being relieved of the obligation to pay any attorney's fee for
the defendant's proper services indicate that denial
of a fair fee would be unreasonable in the circumstances. Town Planning & Eng'g Assocs. v. Amesbury Specialty Co., supra at 746, 342 N.E.2d 706.
[3][4] 2. Although we reject the plaintiff's argument that, because of the violation **896 of rule
3:14, she was entitled to recover amounts the defendant received for representing her, we do agree
with the plaintiff that the amount of the defendant's
fee was a jury question. The motion judge erred in
allowing the defendant's motion to strike the
plaintiffs claim for a jury trial as to count one. The
question of what was fair and reasonable compensation for the services rendered is a question of fact
(see Cummings v. National Shawmut Bank, 284
Mass. 563, 568, 188 N.E. 489 [1933] ), and, when a
jury claim is seasonably made, as it was here, the
factual issue should be submitted to a jury. In support of the denial of a jury trial on the issue of the
reasonable fee to which he was entitled, the defendant relies on that portion ofS.J.C. Rule 3:14(6), 351
Mass. 795 (1967), which stated that "[t]he reasonableness of a contingent fee agreement shall be subject to review by a court of competent jurisdiction."
The word "court," however, includes a court consisting of a judge and jury, where appropriate. *809
Cameron v. Sullivan, 372 Mass. 128, 132 n. 3, 260
N.E.2d 890 (1977). Rule 3:14 did not pwport to
deny the plaintiff a jury trial, and rightly so, because a court rule cannot deny a person his or her
.gh . . l FN5 n t to a Jury tna.
FN5. The defendant is not aided by the fact
that rule 3: 14( 6) stated that " [ t ]he reasonableness of a contingent fee agreement
shall be subject to review by a court of
Page6
competent jurisdiction prior to the expiration of one year following the making of
the agreement or one year following the
date of last rendition of services"
(emphasis supplied). Here, the agreement
is invalid and a nullity. Its reasonableness
is not in dispute. Rule 3:14 says nothing
about actions seeking a fair and reasonable
fee. We need not decide whether, if a contingent fee agreement is properly executed
in circumstances authorized by the rule, a
client may challenge the reasonableness of
the fee after the time limits of the rule have
expired.
3. We come then to the plaintiffs claim under
G.L. c. 93A. She argues that the use of a pwported
contingent fee agreement was an unlawful act or
practice because, in the words of G.L. c. 93A, §
2(a), inserted by St.1967, c. 813, § 1, the defendant
engaged in "unfair or deceptive acts or practices in
the conduct of any trade or commerce." Even if we
assume that the defendant's conduct in attempting
to obtain a contingent fee agreement was "unfair or
deceptive," the plaintiff sustained no "loss of
money or property" as a result of the agreement itself. See G.L. c. 93A, § 9(1), as amended through
St.l971, c. 24l.FN6 The agreement is unenforceable, and the plaintiff sustained no injury solely
from its existence.
FN6. See now G.L. c. 93A, § 9(1), as appearing in St.1979, c. 406, § 1 (eliminating
the reference to damages on the basis of a
loss of "money or property" and substituting the words "who has been injured").
[5] The plaintiff argues further that the defendant's reliance on the unenforceable agreement toretain one third of the $30,000 additional payment
that he negotiated is itself unlawful under G.L. c.
93A, § 2. We conclude that because the pwported
contingent fee agreement was unenforceable, his reliance on that agreement to justify the amount of
his fee was improper. The defendant's reliance on
an agreement made in violation of S.J.C. Rule 3:14
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443 N.E.2d892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
in these circumstances was, as a matter of law, an
unfair or deceptive act or practice.
*810 We cannot tell at this time, however,
whether the plaintiff sustained a loss of money or
property as a result of the defendant's reliance on
the contingent fee agreement. If the jury should
find the defendant's reasonable fee (and expenses)
equalled or exceeded the $11,075 that he has retained, the plaintiff will have sustained no loss of
money or property because of the G.L. c. 93A violation. If, on the other hand, the reasonable fee
awarded to the defendant is less than $11,075, the
plaintiff will have been denied the use of the difference between $11,075 and the fee awarded to the
defendant. Although, in such a situation, the
plaintiff would be entitled, quite apart from G.L. c.
93A, to interest on the amount of any excess retained by the defendant, there will be a question for
the court to decide concerning a doubling or
trebling of the damages (G.L. c. 93A, § 9[3] ) and
the award of reasonable att~~·s fees and **897
costs (G.L. c. 93A, § 9[4] ). Thus the matter of
relief under G.L. c. 93A must await the verdict under count one.
FN7. We construe the plaintiff's written
demand for relief (G.L. c. 93A, § 9[3] ) as
sufficient to challenge the defendant's retention of the fee in reliance on S.J.C. Rule
3:14. The defendant made no written
tender of settlement. Thus, under G.L. c.
93A, § 9(3), the plaintiff would be entitled
to between double and triple damages if
the court should find that the unlawful act
"was a willful or knowing violation [of §
2] ... or that the refusal to grant relief upon
demand was made in bad faith with knowledge or reason to know that the act or
practice complained ofviolated [§ 2]."
[6][7] 4. The matter of the plaintiff's right to interest (and to multiple damages under G.L. c. 93A
for the loss of use of her money) is complicated by
her claim, under both counts one and two, for interest pursuant to G.L. c. 221, § 51. Section 51
Page7
provides that an attorney "who unreasonably neglects to pay over money collected by him for and in
behalf of a client, when demanded by the client,
shall forfeit to such client five times the lawful interest of the money from the time of the demand."
This claim is one for a jury and not for a judge
alone, assuming that there is evidence *811 that the
FN8 attorney acted unreasonably. An attorney who
acted in good faith where there was an honest controversy between the parties would not be liable for
an interest penalty under § 51. Zuckernik v. Jordan
Marsh Co., 290 Mass. 151, 156, 194 N.E. 892
(1935).
FN8. The motion judge's allowance of the
defendant's motion to strike the plaintiff's
jury claim was wrong as applied to the
plaintiff's claim under G.L. c. 221, § 51.
The plaintiff makes no cognizable argument in her brief that she was entitled to a
jury trial on her G.L. c. 93A claim.
If the jury determines that the defendant's reasonable fee was less than the $11,075 he retained,
the jury must then determine whether the attorney
unreasonably neglected to pay the plaintiff the
amount in excess of his reasonable fee. This factual
question can be submitted to the jury in the form of
a special question. Mass.R.Civ.P. 49(a), 365 Mass.
812 (1974). If the jury should decide that the defendant did act unreasonably, he will be liable under § 51 for interest at five times the lawful rate.
This amount will exceed any damages possibly recoverable under G.L. c. 93A, § 9, for the same period of time, except, of course, for an allowance of
reasonable attorney's fees and costs. If any violation ofG.L. c. 93A and G.L. c. 221, §51, is for the
same wrong (the wrongful withholding), cumulative damages should not be awarded. If there is an
overlapping of damages, the damages allowed
should reflect the greater statutory award provided
in§ 51. See McGrath v. Mishara, 386 Mass. 74, 85,
434 N.E.2d 1215 (1982).FN9
FN9. Damages, assuming there are any,
will not be overlapping in all respects. In
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443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
retaining $10,000 of the $30,000 additionally paid by the plaintiffs former husband,
the defendant initially relied on the unenforceable contingent fee agreement. As we
have said, that reliance was unlawful under
G.L. c. 93A, § 2, as a matter of law. Thus,
any damages under G.L. c. 93A run from
the date the defendant retained the
$10,000. As of the date of the plaintiffs
demand for the return of the $10,000, assuming there is a G.L. c. 221, § 51, violation, damages payable under § 51 and G.L.
c. 93A would be cumulative and§ 51 damages would supersede any G.L. c. 93A
damages.
5. We come finally to the plaintiffs appeal
from the allowance of summary judgment for the
defendant on count three, the malpractice claim.
The summary judgment *812 judge, appropriately
at the time, relied on findings made by the trial
judge in the earlier trial of counts one and two.
Those findings, however, have no continuing validity because, as we have just held, the plaintiff was
entitled to a jury trial on count one and on her claim
for multiple interest on any funds allegedly withheld unreasonably.
[8] We must assess the propriety of summary
judgment for the defendant on the basis of other
material appropriately before the summary judgment judge. Based on affidavits of the parties and
portions of a deposition of the plaintiff that were
submitted to the judge, there is a genuine issue of
material fact concerning the defendant's alleged
negligence in his representation of the plaintiff.
**898 [9)[10] The defendant, however, argues
that there is no genuine issue of material fact with
regard to the plaintiffs chances of overturning the
original separation agreement on the basis of fraud
or coercion. In other words, without conceding his
negligence, the defendant argues that the plaintiff
sustained no loss because there was no basis for
achieving a favorable result in the attempt to set
aside the separation agreement. He points to testiPageS
mony of the plaintiff on deposition in which she admitted that there was no duress or coercion by her
husband. However, by affidavit, the plaintiff denies
that she admitted at any time that there was no
fraud or duress in the execution of the original separation agreement. A deposition and a contrary affidavit must both be considered in passing on a motion for summary judgment. See Kennett-Murray
Corp. v. Bone, 622 F.2d 887, 893-894 (5th
Cir.1980); Camer/in v. New York Cent. R. Co., 199
F.2d 698, 701 (1st Cir.1952); 6 Moore's Federal
Practice par. 56.22[1], at 1325-1326 (2d ed. 1982);
10 C.A. Wright & A.R. Miller, Federal Practice and
Procedure § 2738 at 686 (1973). The admission in
the plaintiffs deposition is, therefore, not binding
on her. See McMahon v. M & D Builders, Inc., 360
Mass. 54, 61, 271 N.E.2d 649 (1971); Junkins v.
Slender Woman, Inc., 7 Mass.App. 878, 386 N.E.2d
789 (1979).
Although we recognize that there may be instances in which an affidavit denying deposition
testimony may not *813 fairly raise a genuine issue
of material fact (see Perma Research & Dev. Co. v.
Singer Co., 410 F.2d 572, 578 [2d Cir.1969] ), we
are reluctant to hold the plaintiff to conclusions of
law stated in her deposition. We know that, despite
the defendant's claim that the plaintiffs cause was
hopeless, the plaintiff did receive additional financial benefits from the renegotiation of the separation agreement. Assuming, without deciding, that
the defendant was negligent in his investigation of
the husband's assets, we cannot say, on the facts
presented on the motion for summary judgment,
that his negligence did not result in a less satisfactory result for the plaintiff than she would have obtained if there had been no negligence. Although,
from what has been shown to us, we are skeptical
of the merits of the plaintiffs claim, particularly in
light of the admissions in her deposition and the
now nugatory findings made by the trial judge,
there was a genuine issue of material fact to be tried
under count three.
6. The judgments for the defendant are re-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
443 N.E.2d 892
387 Mass. 802, 443 N.E.2d 892
(Cite as: 387 Mass. 802, 443 N.E.2d 892)
versed. The order denying the plaintiff a jury trial
on count one and on her claim for multiple interest
on funds allegedly withheld unreasonably is vacated to that extent. The action is remanded for a
jury trial on those issues and on count three. The
plaintiffs rights under G.L. c. 93A depend on the
results of the jury trial.
So ordered.
Mass., 1982.
Guenard v. Burke
387 Mass. 802, 443 N.E.2d 892
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page9
Westlaw,
Page 1
54 S.W.3d 526, 144 Lab. Cas. P 34,362, 7 Wage & Hour Cas.2d (BNA) 446
(Cite as: 54 S.W.3d 526)
c
Court of Appeals of Texas,
Houston (1st Dist.).
Angel GUITY, Appellant,
v.
C.C.I. ENTERPRISE, COMPANY, Appellee.
No. 01-00-01038-CV.
Aug. 23, 2001.
Employee brought action against employer to
recover unpaid overtime wages under the Fair
Labor Standards Act (FLSA). The 165th Judicial
District Court, Harris County, Elizabeth Ray, J.,
granted summary judgment for employee but did
not award requested amount of attorney fees. Employee appealed. The Court of Appeals, Nuchia, J.,
held that genuine issue of material fact on reasonability of attorney fees precluded summary judgment on that issue.
Affirmed in part, reversed in part, and remanded.
West Headnotes
[1] Judgment 228 €:::::> 181(21)
228 Judgment
228V On Motion or Summary Proceeding
228kl8l Grounds for Summary Judgment
228kl81(15) Particular Cases
228kl81(21) k. Employees, Cases Involving. Most Cited Cases
Genuine issue of material fact as to the reasonableness of attorney fees claimed by employee precluded summary judgment on this issue, in employee's action against employer for unpaid overtime
wages, brought under the Fair Labor Standards Act
(FLSA). Fair Labor Standards Act of 1938, §§ 2(a),
9(b), 29 U.S.C.A. §§ 207(a), 216(b).
[2] Judgment 228 €:::::> 185.3(1)
228 Judgment
228V On Motion or Summary Proceeding
228k182 Motion or Other Application
228k185.3 Evidence and Affidavits in
Particular Cases
228k185.3(1) k. In General. Most
Cited Cases
The award of attorney fees in a summary judgment is improper unless the evidence of the reasonableness of those fees is uncontroverted.
[3] Judgment 228 €:::::> 186
228 Judgment
228V On Motion or Summary Proceeding
228k182 Motion or Other Application
228kl86 k. Hearing and Determination.
Most Cited Cases
When the amount of attorney fees is not conclusively established, the attorney fees question
may be severed on summary judgment and remanded for trial.
[4] Costs 102 €:::::> 194.18
102 Costs
102Vlll Attorney Fees
102k194.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
In determining the reasonableness of attorney's
fees, the fact fmder must be guided by a specific
standard; this standard is substantially similar under
both federal law and state law. State Bar Rules,
V.T.C.A., Government Code Title 2, Subtitle G
App., Art. 10, § 9, Rules of Prof.Conduct, Rule
1.04.
[5) Labor and Employment 231H €:::::> 2405
231H Labor and Employment
231 HXIII Wages and Hours
231HXIII(B) Minimum Wages and Overtime
Pay
231 HXIII(B)6 Actions
231Hk2401 Costs and Attorney Fees
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page2
54 S.W.3d 526, 144 Lab. Cas. P 34,362, 7 Wage & Hour Cas.2d (BNA) 446
(Cite as: 54 S.W.3d526)
231 Hk2405 k. Amount. Most Cited
Cases
(Formerly 232Akl571 Labor Relations)
Because federal law provides a very specific
framework for analyzing the reasonableness of attorney fees under statutes like the Fair Labor Standards Act (FLSA), the federal framework must be
followed in determining and reviewing the reasonableness of attorney fees under the FLSA. Fair
Labor Standards Act of 1938, § 9(b), 29 U.S.C.A. §
216(b).
[6] Costs 102 €= 194.18
102 Costs
102VIII Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
To calculate reasonable attorney fees, a fact
finder should multiply the number of hours worked
by the attorney's hourly rate; both the number of
hours and the hourly rate must be reasonable.
[7] Costs 102 €= 194.18
102 Costs
102VIII Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
The amount resulting from multiplying the
hours an attorney worked by the attorney's hourly
fee is commonly referred to as the "lodestar figure"
for attorney fees.
[8] Costs 102 €= 194.18
102 Costs
102VIII Attorney Fees
102kl94.18 k. Items and Amount; Hours;
Rate. Most Cited Cases
The factors to be considered in adjusting attorney fees up or down from the "lodestar" amount include: (1) the time and labor required, (2) the novelty and difficulty of the questions, (3) the level of
skill required, (4) the effect on other employment
by the attorney, (5) the customary fee, (6) whether
the fee is fixed or contingent, (7) time limitations
imposed by the client or the circumstances, (8) the
amount involved and the results obtained, (9) the
experience, reputation, and ability of the attorney,
( 1 0) the "undesirability" of the case, ( 11) the nature
and length of the attorney's relationship with the
client, and (12) awards in similar cases; if some of
these factors are accounted for in the "lodestar"
amount, they should not be considered when making adjustments.
*527 Peter Costea, Houston, for Appellant.
Charles L. Henke, Jr., Scott Christopher Gillett,
Henke & Associates, Houston, for Appellee.
Panel consists of Justices HEDGES, NUCillA, and
BRISTER. FN*
FN* The Honorable Scott Brister, who became Chief Justice of the Fourteenth Court
of Appeals on July 16, 2001, continues to
participate by assignment for the disposition of this case, which was submitted on
May 14, 2001.
OPINION
NUCillA, Justice.
Appellant-plaintiff Angel Guity appeals from a
summary judgment granted in his favor in a suit
against appellee-defendant C.C.I. Enterprises,
Company ("C.C.I."), for unpaid overtime wages under the Fair Labor Standards Act ("FLSA"). FNl
See 29 U.S.C. A. § 207(a) (West 1998). In a single
point of error, Guity contends the trial court erred
in denying his full recovery of attorney's fees. We
affirm in part and reverse in part.
FNl. Section 216(b) of the Fair Labor
Standards Act gives state courts jurisdiction to hear cases involving suits for overtime pay. 29 U.S.C.A. § 216(b) (West
1998) ("An action to recover ... may be
maintained against any employer
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page3
54 S.W.3d 526, 144 Lab.Cas. P 34,362,7 Wage & Hour Cas.2d (BNA) 446
(Cite as: 54 S.W.3d526)
(including a public agency) in any Federal
or State court of competent jurisdiction .... ").
BACKGROUND
On appeal neither party complains about the
trial court's granting of summary judgment on the
underlying claim. The only issue before us is the
trial court's award of attorney's fees.
Attached to Guity's summary judgment motion
was the affidavit of Peter Costea, Guity's attorney.
In it, Costea claims $8,325.00 in attorney's fees for
prosecuting the suit, and he also sets out why that
amount is reasonable. C.C.I.'s response motion to
Guity's motion for summary judgment included the
affidavit of its attorney, *528 Charles L. Henke, Jr.
After also setting out his qualifications and professional experience, Henke's affidavit lists a set of
factors courts follow in determining the reasonableness of attorney's fees. The affidavit concludes by
stating that a "reasonable fee for the necessary services performed to date in connection with the prosecution of this case is $500.00." In its final order,
the trial court awarded Guity $500.00 in attorney's
fees. Guity appeals that amount.
DISCUSSION
The relevant portion of the FLSA states, "The
court in such action, shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a
reasonable attorney's fee to be paid by the defendant, and costs of the action." 29 U.S.C.A. § 216(b)
(West 1998). The language of the statute is mandatory; that is, a prevailing plaintiff must be awarded
reasonable attorney's fees and costs in actions
brought under the FLSA. See Purcell v. Seguin
State Bank and Trust Co., 999 F.2d 950, 961 (5th
Cir.1993).
[1][2][3] In this case, the award of attorney's
fees was made as a matter of summary judgment.
The award of attorney's fees in a summary judgment is improper unless the evidence of the reasonableness of those fees is uncontroverted. That is not
the case here, given that conflicting affidavits from
opposing attorneys were presented. FN2 General
Elec. Supply Co. v. Gulf Electroquip, Inc., 857
S.W.2d 591, 601 (Tex.App.-Houston [1st Dist.]
1993, writ denied). When the amount of attorney's
fees is not conclusively established, the attorney's
fees question may be severed and remanded for trial. /d. at 602.
FN2. In addition to the affidavit disputing
the reasonableness of attorney's fees
sought by Guity, C.C.I's motion opposing
Guity's motion for summary judgment asserted that "there is a genuine issue of material fact whether these [attorney's] fees
are reasonable .... "
[ 4] In determining the reasonableness of attorney's fees, the fact finder must be guided by a specific standard. This standard is substantially similar
under both federal law and state law. See Purcell,
999 F.2d at 961 (setting out the federal standard);
Arthur Andersen v. Perry Equip. Corp., 945 S.W.2d
812, 818 (Tex.1997) (setting out the state standard
and citing to TEX. DISCIPLINARY R. PROF'L
CONDUCT 1.04, reprinted in TEX. GOVT CODE
ANN., tit. 2, subtit. G app. A (Vernon 1998) (TEX.
STATE BARR., art. X,§ 9)); Gorges Foodservice,
Inc. v. Huerta, 964 S. W .2d 656, 673
(Tex.App.-Corpus Christi 1997, no pet.).
[5] However, because federal law provides a
very specific framework for analyzing the reasonableness of attorney's fees under statutes like the
FLSA, the federal framework must be followed in
determining and reviewing the reasonableness of
attorneys's fees under section 216. See Hensley v.
Eckerhart, 461 U.S. 424, 430-33, 103 S.Ct. 1933,
1937-39, 76 L.Ed.2d 40 (1983). In Hensley, the
Court noted that the standards set forth in that opinion "are generally applicable in all cases in which
Congress has authorized an award of fees to a
'prevailing party.' " /d. 461 U.S. at 433, 103 S.Ct.
at 1939 n. 7. Congress has mandated the award of
attorney's fees to a prevailing party in FLSA
claims. See 29 U.S.C.A. § 216(b) (West 1998).
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
54 S.W.3d 526, 144 Lab. Cas. P 34,362,7 Wage & Hour Cas.2d (BNA) 446
(Cite as: 54 S.W.3d 526)
[6][7](8] To calculate reasonable attorney's
fees, the fact finder should multiply the number of
hours worked by the attorney's hourly rate. Purcell,
999 F.2d at 961. Both the number of hours and the
hourly rate must be reasonable. !d. The resulting
amount is commonly referred to as the "lodestar"
figure. After calculating *529 the lodestar amount,
"the district court can adjust the amount upward or
downward to account for the well-established Johnson factors." !d. (citing Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th
Cir.1974)). The Johnson factors include: (1) the
time and labor required; (2) the novelty and difficulty of the questions; (3) the level of skill required; (4) the effect on other employment by the
attorney; (5) the customary fee; (6) whether the fee
is fixed or contingent; (7) time limitations imposed
by the client or the circumstances; (8) the amount
involved and the results obtained; (9) the experience, reputation, and ability of the attorney; (10)
the "undesirability" of the case; ( 11) the nature and
length of the attorney's relationship with the client;
and (12) awards in similar cases. Johnson, 488 F.2d
at 717-19. If some of these factors are accounted
for in the lodestar amount, they should not be considered when making adjustments. Shipes v. Trinity
Indus., 987 F.2d 311, 320 (5th Cir.1993).
The cause, therefore, is remanded for a determination and award of reasonable attorney's fees. Appellant's point of error is sustained.
We affirm the portion of the judgment awarding overtime wages and liquidated damages, and reverse the portion of the judgment awarding attorney's fees, ~d remand the cause for further proceedings.
Tex.App.-Houston [1 Dist.],2001.
Guity v. C.C.I. Enterprise, Co.
54 S.W.3d 526, 144 Lab.Cas. P 34,362, 7 Wage &
Hour Cas.2d (BNA) 446
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page4
Westlaw,
211 A.D.2d 617, 620 N.Y.S.2d 847
(Cite as: 211 A.D.2d 617, 620 N.Y.S.2d 847)
H
Supreme Court, Appellate Division, Second Department, New York.
Ronald HART, et al., etc., Plaintiffs-Respondents,
v.
CARRO, SPANBOCK, KASTER & CUIFFO, etc.,
Defendant Third-Party Plaintiff-Appellant, et al.,
Defendant,
Hayt, Hayt & Landau, Third-Party Defendant-Respondent.
Jan. 9, 1995.
Former client brought legal malpractice action
against law flrm based on firm's representation of
client in stock purchase transaction in which interest of client in collateral located in foreign country was not secured, and law flrm brought thirdparty claim against second law flrm which had assumed representation of client. Client moved for
partial summary judgment and second law flrm
moved to dismiss complaint, and the Supreme
Court, Nassau County, Levitt, J., granted motions.
Law flrm appealed, and the Supreme Court, Appellate Division, held that: (1) conduct of law flrm in
failing to properly structure stock transaction and
investigate and evaluate enforceability of pledge of
foreign collateral constituted legal malpractice, and
(2) law flrm was not entitled to contribution from
second law flrm which did not assume representation until after injury-causing acts had taken place.
Affirmed.
West Headnotes
[1] Attorney and Client 45 €= 109
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl09 k. Acts and Omissions of Attorney in
General. Most Cited Cases
Attorney and Client 45 €= 112.50
Page 1
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45k112.50 k. Research and Knowledge of
Law. Most Cited Cases
Attorney was negligent in failing to properly
structure stock purchase agreement and to properly
investigate, evaluate, and advise client as to enforceability of pledge agreement used to secure collaterallocated in foreign country in connection with
stock purchase agreement where failure to secure
foreign collateral caused client to be without assets
against which to satisfy judgment obtained in action
arising out of stock purchase, even though attorney
repeatedly suggested that client obtain foreign
counsel.
(2] Attorney and Client 45 €= 109
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kl09 k. Acts and Omissions of Attorney in
General. Most Cited Cases
Attorney and Client 45 €= 112.50
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kll2.50 k. Research and Knowledge of
Law. Most Cited Cases
When counsel is retained in matter involving
foreign law, it is counsel's responsibility to conduct
matter properly and know, or learn, law of foreign
jurisdiction; counsel may not shift to client legal responsibility it was specifically hired to undertake
because of its superior knowledge.
[3] Contribution 96 €= 5(6.1)
96 Contribution
96k2 Common Interest or Liability
96k5 Joint Wrongdoers
96k5( 6) Particular Torts or Wrongdoers
96k5( 6.1) k. In General. Most Cited
Cases
Law flrm against which legal malpractice ac-
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
211 A.D.2d 617, 620 N.Y.S.2d 847
(Cite as: 211 A.D.2d 617, 620 N.Y.S.2d 847)
tion was brought by client as result of firm's handling of stock purchase agreement was not entitled to
seek contribution from second law firm which had
assumed representation of client where injuryproducing conduct of improperly structuring transaction and advising client, which resulted in failing
to obtain interest in collateral, occurred before
second law firm assumed any responsibility in matter.
[4] Attorney and Client 45 €= 112
45 Attorney and Client
45III Duties and Liabilities of Attorney to Client
45kll2 k. Conduct of Litigation. Most Cited
Cases
Law firm's decision to pursue legal malpractice
claim against client's prior law firm in connection
with prior firm's handling of stock purchase agreement in attempt to mitigate client's damages, rather
than pursue any evanescent interest client retained
in collateral which was part of stock purchase
agreement, was reasonable course of action and did
not constitute legal malpractice.
**847 Wilson, Elser, Moskowitz, Edelman & Dicker, New York City (Thomas W. Hyland, Mark W.
Anesh, and Edward A. Magro, of counsel), for defendant third-party plaintiff-appellant.
Hayt, Hayt & Landau, Great Neck (Clifford J. Chu
and Ralph Pernick, of counsel), for plaintiffs-respondents.
Sedgwick, Detert, Moran & Arnold, New York City
(James Clair and Douglas Poetzsch, of counsel), for
third-party defendant-respondent.
Before ROSENBLATT, J.P., and LAWRENCE,
JOY and KRAUSMAN, JJ.
**848 *617 MEMORANDUM BY THE COURT.
In an action to recover damages, inter alia, for
legal malpractice, the defendant third-party plaintiff
appeals from an order of Supreme Court, Nassau
Page2
County (Levitt, J.), dated January 31, 1992, which
(I) denied its motion to disqualify Hayt, Hayt &
Landau as counsel of record for the plaintiffs, and
(2) granted those branches of the joint cross motion
of the plaintiffs and Hayt, Hayt & Landau which
were (a) to grant partial summary judgment to the
plaintiffs on their cause of action for legal malpractice in connection with the sale of certain real estate
located in the Bahamas, and (b) to dismiss the
third-party complaint insofar as asserted against
Hayt, Hayt & Landau.
ORDERED that the order is affirmed, with one
bill of costs payable to the respondents appearing
separately and filing separate briefs.
This action for legal malpractice arises out of
the plaintiffs' sale of stock in American Plan Corporation (hereinafter APC), to APN Holdings Corp.
(hereinafter APN), an entity controlled by Abe J.
Lieber (hereinafter Lieber). The APC stock was the
major asset of a testamentary trust established under the will of Mark M. Hart. In essence, the
plaintiffs claim that their financial losses were
caused by the improper structuring of a Stock Purchase Agreement by the law firm of Carro, Spanbock,*618 Kaster & Cuiffo (hereinafter Carro), and
Carro's deficient legal advice rendered in conjunction with the stock sale.
As a result of the problems which arose in connection with the stock sale Carro was discharged
and ultimately replaced by Hayt, Hayt & Landau
(hereinafter Hayt). The plaintiffs, then represented
by Hayt, commenced this action against Carro,
inter alia, for legal malpractice. Thereafter, Carro
commenced the third-party action against Hayt, alleging that if Carro was negligent and caused the
plaintiffs' losses, Hayt was similarly negligent and
therefore liable for its proportionate share of any
judgment against Carro. Carro then moved to disqualify Hayt as plaintiffs' counsel, on the grounds
of conflict of interest and violation of the attorneywitness rule, as Carro intended to call Hayt as a
witness in its third-party action.
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
211 A.D.2d 617, 620 N.Y.S.2d 847
(Cite as: 211 A.D.2d 617, 620 N.Y.S.2d 847)
APC and the Hart family were long-standing
clients ofthe Carro firm. In 1976 Carro drafted the
will providing for the testamentary trust, and in
1982 Carro drafted the Stock Purchase Agreement
for the sale of the APC stock to APN. The Stock
Purchase Agreement was executed by the contracting parties on June 25, 1982. It provided for a total
purchase price of $5,206,910 for the stock,
$1,750,000 of which was to be paid in two installments ($520,000 and $1,230,000) on or prior to the
closing, with the deferred balance of $3,456,910 to
be paid after closing pursuant to a promissory note.
The Stock Purchase Agreement was structured so
that the collateral used to secure the deferred balance had three components: (1) a second mortgage
on commercial real property in Plano, Texas
(hereinafter the Texas collateral); (2) a personal
guaranty signed by Lieber, his wife, and five
Ueber-controlled Bahamian corporations; and (3)
the Bahamian collateral, which consisted of a
pledge agreement whereby APN pledged shares of
stock it owned in three Ueber-controlled corporations, which in tum owned separate parcels of real
estate in the Bahamas, to wit, the Whitfield Parcel,
owned by Whitfield Corp., the Sunward Villas Parcel, owned by Sunward Villas, Ltd., and the ABT
Parcel, owned by ABT Investments, Ltd. {Only the
ABT Parcel, which was sold on October 19, 1982,
two weeks after the closing on the SPA, is at issue
here.) The closing took place on October 5, 1982.
The buyers also executed the personal guaranty and
the pledge agreement at that time. After the closing,
Lieber/ APN failed to transfer the stock certificates
relating to the Bahamian collateral and also refused
to make payment on the promissory note.
To avoid its obligations on the promissory
note, in June *619 1983 APN commenced an action
against the plaintiffs {hereinafter the APN action)
in Federal District Court, contending that it was
fraudulently induced to purchase the APC stock at
an inflated price. (Carro represented the plaintiffs
in the APN action until January 1984, when the
plaintiffs engaged Hayt to replace Carro as the
plaintiffs' **849 counsel of record). In September
Page3
1985, the Federal District Court rendered a $4.5
million judgment in favor of the plaintiffs and
against APN and the guarantors on the note (see,
A.P.N. Holdings Corp. v. Hart, 615 F.Supp. 1465).
In October 1985, Lieber and the other guarantors
filed for bankruptcy, or were otherwise determined
to be judgment-proof. In addition, the Texas collateral had previously proved to be worthless.
This state of affairs left the Bahamian collateral
as the only possible asset remaining to satisfy the
APN judgment. Therefore, in December 1985 the
plaintiffs, then represented by Hayt, contacted an
attorney in the Bahamas who advised them that, under Bahamian law, th~ pledged stock did not secure
any interest in the Bahamian corporations or in the
Bahamian real estate. Moreover, since further investigation revealed that APN and Lieber had no
other assets in the Bahamas, Bahamian counsel
concluded that nothing further could be done to satisfy the judgment.
[1][2] In these circumstances, the court properly granted the plaintiffs' cross motion for partial
summary judgment as to the ABT Parcel. The record establishes that in improperly structuring the
Stock Purchase Agreement and in failing to properly investigate, evaluate, and advise the plaintiffs
as to the enforceability of the pledge agreement
used to secure the Bahamian collateral, Carro did
not exercise that degree of skill commonly exercised by an ordinary member of the legal community (see, Marshall v. Nacht, 172 A.D.2d 727,
727-728, 569 N.Y.S.2d 113). Carro thus breached
its duty to the plaintiffs and proximately caused
their damages (see, Marshall v. Nacht, supra;
Murphy v. Stein, 156 A.D.2d 546, 548, 549
N.Y.S.2d 53). Carro's attempt to avoid liability by
emphasizing that it repeatedly urged plaintiff Ronald Hart to employ Bahamian counsel is to no avail.
When, as here, counsel is retained in a matter involving foreign law, it is counsel's responsibility to
conduct the matter properly and to know, or learn,
the law of the foreign jurisdiction (see, Matter of
New York County Lawyers Assn. [Roe/], 3 N.Y.2d
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
211 A.D.2d 617, 620 N.Y.S.2d 847
(Cite as: 211 A.D.2d 617, 620 N.Y.S.2d 847)
224, 232, 165 N.Y.S.2d 31, 144 N.E.2d 24; Degen
v. Steinbrink, 202 App.Div. 477, 481, 195 N.Y.S.
81 0). Counsel may not shift to the client the legal
responsibility it was specifically hired to undertake
because of its superior knowledge (see, Cicorelli v.
Capobianco, 90 A.D.2d 524, 525, 453 N.Y.S.2d
21 ). In any event, we *620 note that Ronald Hart,
as only one of the trustees, was not authorized to
bind the trust. Accordingly, Carro was not in a position to properly rely on Ronald Hart's alleged decision not to retain counsel in the Bahamas.
[3][4] The Supreme Court also properly dismissed the third-party complaint for contribution
insofar as it is asserted against Hayt. Hayt did not
begin representing the plaintiffs in the matter until
January 1984. The injury-producing conduct, the
improper structuring of the Stock Purchase Agreement and the related advice Carro provided to the
plaintiffs, which led to the sale of the ABT Parcel
on October 19, 1982, and the plaintiffs' subsequent
fmancial loss, occurred before Hayt assumed any
responsibility in the matter. Moreover, Hayt's
choice to pursue a legal malpractice claim to mitigate the plaintiffs' damages, rather than pursue any
evanescent interest the plaintiffs may have retained
in the Bahamian collateral, was a reasonable course
of action and did not constitute legal malpractice (
see, Rosner v. Paley, 65 N.Y.2d 736, 738, 492
N.Y.S.2d 13, 481 N.E.2d 553; Johnson v. Berger,
193 A.D.2d 784, 786, 598 N.Y.S.2d 270; Ferlisi v.
Jackrel, Kopelman & Raskin, 167 A.D.2d 502, 503,
562 N.Y.S.2d 173).
Finally, with the dismissal of the third-party
action insofar as it is asserted against Hayt, Carro's
motion for disqualification of Hayt is academic.
N.Y.A.D. 2 Dept.,l995.
Hart v. Carro, Spanbock, Kaster & Cuiffo
211 A.D.2d 617,620 N.Y.S.2d 847
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page4
Westlaw,
Page 1
105 U.S. 45, 15 Otto 45, 1881 WL 19787 (U.S.Ariz.), 26 L.Ed. 1028
(Cite as: 105 U.S. 45, 1881 WL 19787 (U.S.Ariz.))
Supreme Court of the United States
HEAD
v.
HARGRAVE.
October Term, 1881
West Headnotes
Appeal and Error 30 €= 553(1)
30 Appeal and Error
30X Record
30X(C) Necessity of Bill of Exceptions,
Case, or Statement ofFacts
30k553 Substitutes
30k553(1) k. In General. Most Cited
Cases
A statement of facts, setting forth alleged errors of law, is available on appeal in place of a bill
of exceptions, if embodied in the record for that
purpose, though it may have been used on a motion
for a new trial.
Attorney and Client 45 €= 140
45 Attorney and Client
45IV Compensation
45k139 Value of Services
45kl40 k. In General. Most Cited Cases
In an action for legal services, the opinions of
attorneys as to their value are not to preclude the
jury from exercising their judgment; and it is in
their province to weigh the opinions by reference to
the nature of the services rendered, the time occupied in their performance, and other attendant circumstances.
Evidence 157 €= 571(7)
157 Evidence
157XII Opinion Evidence
157XII(F) Effect of Opinion Evidence
Cases
157k569 Testimony of Experts
157k571 Nature of Subject
157k571(7) k. Value. Most Cited
Opinion evidence as to the value of professional services is not, as a matter of law, conclusive on
the jury.
Evidence 157 €= 571(7)
157 Evidence
157XII Opinion Evidence
Cases
157XII(F) Effect of Opinion Evidence
157k569 Testimony ofExperts
157k571 Nature ofSubject
157k571(7) k. Value. Most Cited
Great weight should be given to the opinions of
professional men with respect to the value of professional services but the opinions are not to be
blindly received and are to be intelligently examined by the jury in the light of their own general
knowledge.
**1 ERROR to the Supreme Court of the Territory of Arizona.
This was an action brought in a district court of
Arizona to recover the sum of $2,000 alleged to be
owing by the defendants to the plaintiffs for professional services as attorneys and counsellors-at-law
in that Territory in 1877 and 1878. The complaint
alleges that the services were performed in several
suits and proceedings, upon a retainer by the defendants; and that they were reasonably worth that
sum. The answer is a general denial.
On the trial, one of the plaintiffs testified to the
rendition of the services by them in several suits,
stating generally the nature of each suit, the service
performed, and its value. Five attorneys-at-law also
testified to the value of the services; three of whom
were called by the plaintiffs and two by the defendants. They differed widely in their opinions, the
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page2
105 U.S. 45, 15 Otto 45, 1881 WL 19787 (U.S.Ariz.), 26 L.Ed. 1028
(Cite as: 105 U.S. 45, 1881 WL 19787 (U.S.Ariz.))
highest estimateplacing the value of the services at
$5,440, the lowest at $1,000.
The court instructed the jury, that, in determining the value of the plaintiffs' services, they might
consider their nature, the length of time they necessarily occupied, and the benefit derived from them
by the defendants; that the plaintiffs were entitled
to reasonable compensation for the services
rendered; and that the reasonableness of the compensation was a fact to be determined from the
evidence as any other controverted fact in the case;
and then proceeded as follows:--
'The services rendered were skilled and professional, and for the purpose of proving to you the
value of that class of services rendered, professional gentlemen, attorneys-at-law, claiming to be familiar with the value of such services, have testified
before you. If you accredit these witnesses with
truthfulness, their testimony should have weight
with you; and the fact as to what is a reasonable
compensation should be determined from the evidence offered, and not from your own knowledge or
ideas of the value of that class of services. In other
words, you must determine the value of the services
rendered from the evidence which has been offered
before you, and not from your own knowledge or
ideas of the value of such services.'
The defendants thereupon asked the court to instruct the jury as follows:--
'In determining the value of the plaintiffs' services the jury are not bound by the testimony of the
expert witnesses; that testimony may be considered
by the jury; but if, in their judgment, the value
fixed by those witnesses is not reasonable, they
may disregard it, and find the amount which, m
their judgment, would be reasonable.
'In determining the value of the plaintiffs' services the jury are not bound by the opinions of the
witnesses, unless the jury shall find from all the
evidence taken together, including the nature of the
services, the time occupied in the performance of
them, and the result of them, and the benefit derived by the defendants from the rendition of said
services, that said opinions are correct.'
**2 The court refused to give these instructions, and an exception was taken. The jury
thereupon gave a verdict for the plaintiffs for
$1,800; upon which judgment was entered. A statement of the proceedings at the trial was then prepared, which, among other things, set forth the alleged errors of law excepted to by the defendants.
This statement was used on a motion for a new trial, which was denied; and by stipulation it was embodied in the papers for the appeal to the Supreme
Court of the Territory from the judgment, as well as
from the order denying the new trial. The order and
justment were both affirmed; and, to review the
judgment, the case is brought to this court.
Mr. Thomas Fitch and Mr. C. J. Hillyer for the
plaintiffs in error.
Mr. Philip Phillips and Mr. W Hallett Phillips for
the defendants in error.
MR. JUSTICE FIELD, after stating the case, delivered the opinion of the court.
The defendants in error object to the use of the
statement, which sets forth the exceptions taken, as
not constituting a part of the record before us. The
ground of the objection is, that the statement was
prepared for and used on the motion for a new trial,
with the disposition of which this court cannot interfere. The objection would be tenable but for the
stipulation of the parties that the statement might be
used on appeal from the judgment. A statement of
the case, according to the law regulating civil proceedings in the Territory, takes the place of a bill of
exceptions, when the alleged errors of law are set
forth with sufficient matter to show the relevancy
of the points taken. It is not the less available on
appeal from the judgment when, by stipulation, it is
embodied in the record for that purpose, though
used on the motion for a new trial. We have had occasion to refer to this subject in Kerr v. Clampitt,
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page3
105 U.S. 45, 15 Otto 45, 1881 WL 19787 (U.S.Ariz.),26 L.Ed. 1028
(Cite as: 105 U.S. 45, 1881 WL 19787 (U.S.Ariz.))
which arose in Utah, where a similar system of procedure in civil cases obtains; and it is unnecessary
to repeat what is there said. 95 U.S. 188.
The only question presented for our consideration is whether the opinions of the attorneys, as to
the value of the professional services rendered,
were to control the judgment of the jury so *48 as
to preclude them from exercising their 'own knowledge or ideas' upon the value of such services. That
the court intended to instruct the jury to that effect
is, we think, clear. After informing them that, in determining the value of the services, they might consider their nature, the time they occupied, and the
benefit derived from them; also, that the plaintiffs
were entitled to reasonable compensation for the
services, and that the reasonableness of the compensation was a fact to be determined from the
evidence,-it proceeded to call special attention to
the testimony of the attorneys, and told the jury that
if they accredited these witnesses with truthfulness
their testimony should have weight, and the fact as
to what is reasonable compensation should be
'determined from the evidence offered,' and not
from their own knowledge or ideas of the value of
that class of services, and emphasized the instruction by repetition, as follows: 'You must determine
the value of the services rendered from the evidence that has been offered before you, and not from
your own knowledge or ideas as to the value of
such services.' This language qualifies the meaning
of the previous part of the instruction. It is apparent
from the context that by the words 'evidence
offered' and 'evidence that has been offered before
you' reference was made to the expert testimony,
and to that alone. Taken together, the charge
amounts to this: that while the jury might consider
the nature of the services and the time expended in
their performance, their value-that is, what was
reasonable compensation for them-was to be determined exclusively from the testimony of the professional witnesses. They were to be at liberty to
compare and balance the conflicting estimates of
the attorneys on that point, but not to exercise any
judgment thereon by application of their own
knowledge and experience to the proof made as to
the character and extent of the services; that the
opinions of the attorneys as to what was reasonable
compensation was alone to be considered. That the
defendants so understood the charge is evident from
the qualifications of it which they desired to obtain;
and the jury may, in like manner, have so understood it. And as we so construe it, we think the
court erred, and that it should have been qualified
by the instructions requested. Those instructions
correctly presented the law of *49 the case. It is
true that no exception was taken to the charge; but
its modification was immediately sought by the instructions requested, and to the refusal to give them
an exception was taken. Objection to the charge
was thus expressed as affirmatively and pointedly
as if it had been directed in terms to the language
used by the court.
**3 It was the province of the jury to weigh the
testimony of the attorneys as to the value of the services, by reference to their nature, the time occupied in their performance, and other attending circumstances, and by applying to it their own experience and knowledge of the character of such services. To direct them to find the value of the services from the testimony of the experts alone, was
to say to them that the issue should be determined
by the opinions of the attorneys, and not by the exercise of their own judgment of the facts on which
those opinions were given. The evidence of experts
as to the value of professional services does not differ, in principle, from such evidence as to the value
of labor in other departments of business, or as to
the value of property. So far from laying aside their
own general knowledge and ideas, the jury should
have applied that knowledge and those ideas to the
matters of fact in evidence in determining the
weight to be given to the opinions expressed; and it
was only in that way that they could arrive at a just
conclusion. While they cannot act in any case upon
particular facts material to its disposition resting in
their private knowledge, but should be governed by
the evidence adduced, they may, and to act intelligently they must, judge of the weight and force of
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
Page4
105 U.S. 45, 15 Otto 45, 1881 WL 19787 (U.S.Ariz.),26 L.Ed.1028
(Cite as: 105 U.S. 45, 1881 WL 19787 (U.S.Ariz.))
that evidence by their own general knowledge of
the subject of inquiry. If, for example, the question
were as to the damages sustained by a plaintiff from
a fracture of his leg by the carelessness of a defendant, the jury would ill perform their duty and probably come to a wrong conclusion, if, controlled by
the testimony of the surgeons, not merely as to the
injury inflicted, but as to the damages sustained,
they should ignore their own knowledge and experience of the value of a sound limb. Other persons
besides professional men have knowledge of the
value of professional services; and, while great
weight should always be given to the opinions of
those familiar with the subject, they are not to *50
be blindly received, but are to be intelligently examined by the jury in the light of their own general
knowledge; they should control only as they are
found to be reasonable.
As justly remarked by counsel, the present case
is an excellent illustration of the error of confining
the jury to a consideration merely of the opinions of
the experts. Of the five attorneys who were witnesses, no two agreed; and their estimates varied
between the extremes of$1,000 and $5,440. Directing the jurors to determine the value of the professional services solely upon these varying opinions
was to place them in a state of perplexing uncertainty. They should not have been instructed to accept the conclusions of the professional witnesses,
in place of their own, however much that testimony
may have been entitled to consideration. The judgment of witnesses, as a matter of law, is in no case
to be substituted for that of the jurors. The instructions tended to mislead as to the weight to be given
to the opinions of the attorneys, especially after
qualifications of them designed to correct any misconception on this head were refused.
**4 In Anthony v. Stinson, a question similar to
the one here presented came before the Supreme
Court of Kansas, and a like decision was reached.
The instruction given at the trial that the testimony
of certain lawyers as to the value of professional
services should be the guide of the jury, and that
they should be governed by it in fmding the value
of the services rendered, was held to be erroneous;
the court observing that the jury were not to be instructed as to what part of the testimony before
them should control their verdict; that, in order to
control it, the testimony of experts should be of
such a character as to outweigh by its intrinsic force
and probability all conflicting testimony; and that
they could not be required to accept, as a matter of
law, the conclusions of the witnesses instead of
their own. 4 Kan. 211.
In Patterson v. Boston, which arose in Massachusetts, the question was as to the damages to be
awarded to the plaintiff for his property, taken to
widen a street in Boston. The trial court instructed
the jury that, in estimating the amount of the damages, if any of them knew, of his own knowledge,
any material fact which bore upon the issue, he
ought to disclose it *51 and be sworn, and communicate it to his fellows in open court in the presence
of the parties; but that, in making up their verdict,
they might rightfully be influenced by their general
knowledge on such subjects, as well as by the testimony and opinions of witnesses. The case being
taken to the Supreme Court of the State, it was held
that these directions were not open to exception.
Said Chief Justice Shaw, speaking for the court:
'Juries would be very little fit for the high and responsible office to which they are called, especially
to make an appraisement, which depends on knowledge and experience, if they might not avail themselves of those powers of their minds when they are
most necessary to the performance of their duties.'
20 Pick. (Mass.) 159, 166.
In Murdock v. Sumner, the same court, speaking through the same distinguished judge, said that
'the jury very properly exercise their own judgment
and apply their own knowledge and experience in
regard to the general subject of inquiry.' In that
case a witness had testified as to the quality, condition, and cost of certain goods, and given his opinion as to their worth, and the court said that 'the
jury were not bound by the opinion of the witness;
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
105 U.S. 45, 15 Otto 45, 1881 WL 19787 (U.S.Ariz.), 26 L.Ed. 1028
(Cite as: 105 U.S. 45, 1881 WL 19787 (U.S.Ariz.))
they might have taken the facts testified by him as
to the cost, quality, and condition of the goods, and
come to a different opinion as to their value.' 22 id.
156.
In like manner, in this case, the jurors might
have taken the facts testified to by the attorneys as
to the character, extent, and value of the professional services rendered, and then come to a different
conclusion. The instructions given, whilst stating
that the nature of the services rendered, the time occupied in their performance, and the benefit derived
from them·might be considered by the jury, directed
them that they should be governed by the opinions
of the experts as to the value of the services, and, in
effect, forbade them to exercise their own knowledge and ideas on that kind of sercices. This error
would have been avoided if the instructions requested by the defendants had been given.
**5 Judgment reversed and a new trial ordered
U.S.,l881
Head v. Hargrave
105 U.S. 45, 15 Otto 45, 1881 WL 19787
(U.S.Ariz.), 26 L.Ed. 1028
END OF DOCUMENT
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
PageS
Westlaw,
362 N.W.2d 118
122 Wis.2d 94,362 N.W.2d 118
(Cite as: 122 Wis.2d 94, 362 N.W.2d 118)
Supreme Court of Wisconsin.
Jeanette HELMBRECHf, Plaintiff-Appellant -Cross-Petitioner,
plaintiffs case and then renewed their motion following the return of the jury's verdict. FN4 **127
The motion was granted because the *109 trial
870 F.Supp. 1384
(Cite as: 870 F.Supp.1384)
(11] Husband and Wife 205 e=> 21
205 Husband and Wife
205I Mutual Rights, Duties, and Liabilities
205k20 Agency of Wife for Husband
205k21 k. In general. Most Cited Cases
Husband and Wife 205 e=> 25(1)
205 Husband and Wife
205I Mutual Rights, Duties, and Liabilities
205k25 Agency of Husband for Wife
205k25(1) k. In general. Most Cited Cases
Under Virginia law, relationship of husband and
wife does not per force establish agency, but spouse can
be authorized to act as agent of other spouse. Restatement (Second) of Agency § 22.
(12] Principal and Agent 308 e=> 69(1)
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
30811(A) Execution of Agency
308k69 Individual Interest of Agent
308k69(1) k. In general. Most Cited Cases
Principal and Agent 308 e=> 70
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
30811(A) Execution of Agency
308k70 k. Acting for parties adversely interested. Most Cited Cases
Under Virginia law, absent express agreement to
contrary, agent is subject to duty to his principal to act
solely for benefit of principal in all matters connected
with his agency. Restatement (Second) of Agency § 387
(13] Principal and Agent 308 e=> 78(1)
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
30811(A) Execution of Agency
308k78 Actions for Accounting
308k78(1) k. Rights of action, defenses,
and conditions precedent. Most Cited Cases
Page3
Principal and Agent 308 e=> 79(1)
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
30811(A) Execution of Agency
308k79 Actions for Negligence or Wrongful
Acts of Agent
308k79(1) k. Rights of action and defenses.
Most Cited Cases
Under Virginia law, wide range of remedies are
available ·for principal aggrieved by agent's breach of
contract or breach of fiduciary duty; principal may
maintain action for breach of contract, action for tort,
action for restitution either at law or in equity, or action
for accounting. Restatement (Second) of Agency §§ 399
(a, b, d, e).
(14] Principal and Agent 308 e=> 48
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
30811(A) Execution of Agency
308k48 k. Nature of agent's obligation. Most
Cited Cases
Under Virginia law, agency relation, like partnership, is of fiduciary character, and principles which oblige partners to exercise good faith and integrity in their
dealing with one another apply equally to principal and
agent.
(15] Account 9 e=> 1
9 Account
9I Right of Action and Defenses
9kl k. Nature and grounds of right to an account.
Most Cited Cases
Under ·Virginia law, "accounting" is form of equitable relief which is available upon order of court in
equity providing for accounting of funds among those
with partnership or other fiduciary relation inter se, and
may be sought along with purely restitutionary remedies.
(16] Principal and Agent 308 e=> 79(1)
308 Principal and Agent
30811 Mutual Rights, Duties, and Liabilities
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
-
on its accuracy. In other words, the accuracy of the
© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.
55 P.3d 13, 2002 WY 144
(Cite as: 55 P.Jd 13)
information was not a material fact as it relates to
the summary judgment motion.
[~ 34] The district court was correct in granting
Sorensen's motion for summary judgment. There
are no genuine issues of material fact and Sorensen
is entitled to judgment as a matter of law.
Sorensen's expert established the professional
standard of care and gave an opinion based on the
undisputed facts that Sorensen did not breach that
standard. Rino did not counter those opinions with
a contrary expert opinion.
CONCLUSION
[~ 35] Summary judgment should not have
been granted to attorney Mead because there remain genuine issues of material fact as to Mead's
conduct. Because those issues of material fact remain, the burden did not shift to Rino to produce
expert testimony to counter Mead's expert. Summary judgment was, however, properly granted to
accountant Sorensen because no genuine issues of
material fact remain, Sorensen established through
expert opinion testimony that he did not breach the
professional standard of care, and Rino presented
no expert evidence to the contrary.
[~ 36] The summary judgment in favor of Mead
is reversed, the summary judgment in favor of
Sorensen is affirmed, and the case is remanded to
the district court. Such remand does not include
those issues determined by the district court to be
barred by the doctrine of collateral estoppel.
WE CONCUR:
~jj
14
APPENDIX 2
CHAPTER 6
DDD POLICY MANUAL i of ii ISSUED 7/11
DIVISION OF DEVELOPMENTAL DISABILITIES
Olympia, Washington
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
Table of Contents
Page
AUTHORITY.................................................................................................................................1
PURPOSE.......................................................................................................................................1
SCOPE ............................................................................................................................................1
DEFINITIONS ...............................................................................................................................1
POLICY..........................................................................................................................................5
PROCEDURES..............................................................................................................................5
I. REPORTING .....................................................................................................................5
A. Cost Reports.............................................................................................................5
B. Due Date of Report ..................................................................................................6
C. Completing Reports and Maintaining Records........................................................6
D. Report Certification .................................................................................................7
E. Improperly Completed or Late Reports...................................................................8
II. REIMBURSABLE COSTS...............................................................................................8
A. Reimbursable Costs Definition................................................................................8
B. Depreciable Assets...................................................................................................8
C. Equipment and Building Expenses..........................................................................9
D. Reporting Depreciable Assets..................................................................................9
E. Interest....................................................................................................................10
F. Donations and Contributions .................................................................................11
G. Related Organization/Party Costs..........................................................................11
H. Joint Program Costs...............................................................................................12
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL ii of ii ISSUED 7/11
I. Transportation Costs..............................................................................................12
J. Instruction and Support Services...........................................................................13
K. Fringe Benefits.......................................................................................................13
III. SETTLEMENT................................................................................................................13
A. Settlement Definition.............................................................................................13
B. Settlement Determination ......................................................................................14
C. Administrative Staff Hours Counted as ISS for Settlement Purposes...................15
D. Programs Combined for Settlement.......................................................................16
E. Settlement Process.................................................................................................16
F. Optional Two-Year Settlement Process.................................................................17
EXCEPTIONS..............................................................................................................................17
SUPERSESSION..........................................................................................................................17
CHAPTER 6
DDD POLICY MANUAL 1 of 17 ISSUED 7/11
DIVISION OF DEVELOPMENTAL DISABILITIES
Olympia, Washington
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
Authority: Chapter 71A RCW Developmental Disabilities
Chapter 388-101 WAC Certified Community Residential Services and
Support
PURPOSE
This policy establishes procedures and criteria for cost reporting and the settlement process for
Division of Developmental Disabilities (DDD) contracted residential programs.
SCOPE
This policy applies to DDD contracted and certified residential programs, which means
Supported Living (SL) programs, Group Homes (GH), and Group Training Homes (GTH).
DEFINITIONS
Administrative Staff means owners, officers or employees of the contractor, including
executive directors, administrators, accountants, bookkeepers, clerical support and/or secretaries
whose primary job functions require a majority of time for administrative, management and/or
operational support. Administrative staff may also include corporate staff whose time is
allocated to the contractor.
Arm’s-Length Transaction means a transaction resulting from good faith bargaining between a
buyer and seller who hold adverse positions in the market place. Arm‟s-length transactions are
presumed to be objective transactions between disinterested parties (meaning neither the buyer
nor the seller has a financial incentive to buy or sell at a price more or less than market value).
Client means a person who has a developmental disability and is:
1. Eligible under RCW 71A.10.020; and
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL 2 of 17 ISSUED 7/11
2. Authorized by DDD to receive residential services described in Chapter 388-101
WAC.
Client-Specific Staff Add-On means a staffing increase above and beyond the individual
instruction and support hours required and allowed in the standard rate provision of a contract,
enabling a contractor to increase the individual instruction and support hours provided to a
specific client.
Contract means a contract between the department and a contractor for certified community
residential services to clients as described in Chapter 388-101 WAC.
Contractor means an entity contracting with the department to provide certified community
residential services to clients as described in Chapter 388-101 WAC.
Cost-of-Care Adjustment means a reimbursement adjustment intended to cover the necessary
costs of non-variable staff support and administration to provide services to residents during a
time when their residence is temporarily not at full capacity.
Department means the Department of Social and Health Services (DSHS) and its employees.
Division means the DSHS Division of Developmental Disabilities and its employees.
Fringe benefits means benefits provided at the employer's expense to all employees who
qualify. These may include sick leave, health insurance, paid vacation, holiday pay, retirement
plan, and other benefits.
Full Time Equivalent (FTE) means a total of 2,080 hours (52 weeks x 40 hours) worked by one
or more employees during a twelve-month period.
Group Home (GH) Program is included within the meaning of residential services described in
Chapter 388-101 WAC and contract provisions. For purposes of this policy, “Group Training
Home” is synonymous with “Group Home.”
Group Training Home (GTH) means a certified non-profit residential program as per RCW
71A22.020.
Housing Costs for Overnight Coverage means the costs of providing an apartment unit or other
dwelling used by staff when working 24-hour or longer duty shifts. The costs incurred by the
program for these housing costs are client support costs, and not to be reported as Instruction and
Support Services compensation.
Indirect Client Support Costs (ICS) include Maintenance/Repair expenses for client housing,
Client Transportation Expenses, and non-Instruction and Support Services Housing Costs for
Overnight Coverage.
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL 3 of 17 ISSUED 7/11
Instruction and Support Services (ISS) means client services required by Chapter 388-101
WAC and contract provisions. ISS are provided by staff designated as ISS staff (see definition
below). ISS may also be provided by the administrator as described in this policy and by other
administrative personnel (such as bookkeepers, accountants or maintenance workers) if the
provision of ISS is included in their job description.
Instruction and Support Services (ISS) Staff means employees (including counselors,
instructors and/or trainers) of the contractor whose primary job function is the provision of
instruction and support services to clients. ISS staff shall include employees (e.g., program
managers and supervisors) of the contractor whose primary job function is the supervision of ISS
staff.
ISS Hours include:
On the job hours worked by staff designated as ISS staff, including related training time;
For staff who perform both administrative functions and ISS, the agency may include that
portion of the employee‟s hours that are dedicated to ISS function;
The administrator‟s hours worked as ISS as allowed under Section VII.C of this policy;
Sleep hours may be counted as ISS for staff who are required to sleep over and are on
duty in close proximity and are available to respond immediately in person at all times;
and
Call back hours for ISS employees who are required to carry pagers or otherwise are on
call outside of their normal work hours. The maximum number of hours that may be
counted as ISS are the accumulation of hours per shift for those occurrences from the
time a call was received until the employee has been able to return to his/her previous
activities, rounded up to the nearest hour.
The division may request verification of hours (e.g., time sheets, etc.) for all staff for which
ISS hours are claimed.
ISS Staff Compensation for reporting purposes on the annual cost report includes:
ISS staff salaries, wages, stipends and other compensation for staff that are designated as
ISS, and prorated for those staff whose time is split between ISS and administrative
functions;
Employer paid payroll taxes relating the actual allowable ISS hours worked. For
proprietary contractors, the portion of the Business and Occupation (B & O) tax
applicable to the revenue received for ISS reimbursement may be included as payroll tax;
•
•
•
•
•
•
•
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL 4 of 17 ISSUED 7/11
Fringe benefits paid by the employer for ISS staff (prorated for those staff whose time is
split between ISS and administrative functions);
Staff lodging paid by the contractor and as defined in this section; and
As provided for in section VII.C.2. of this policy, compensation for the administrator
time used performing ISS duties. For settlement purposes, compensation is allowed at
the benchmark compensation rate for contractors providing Supported Living (SL)
services.
MA (Non-MSA) and MSA Counties: MSA means Metropolitan Statistical Area - A large
population nucleus, together with adjacent communities that have a high degree of economic and
social integration with that nucleus.
MSA: Metropolitan Statistical Area: Relatively freestanding MA that is not closely
associated with other MAs. These areas typically are surrounded by non-metropolitan counties.
A MSA must include at least:
One city with 50,000 or more inhabitants; or
A Census Bureau-defined urbanized area (of at least 50,000 inhabitants) and a total
metropolitan population of at least 100,000.
For purposes of determining reimbursement rates as stated in this policy, Counties recognized as
MSA counties in Washington are Asotin, Benton, Chelan, Clark, Cowlitz, Douglas, Franklin,
Island, King, Kitsap, Mason, Pierce, Skagit, Snohomish, Spokane, Thurston, Whatcom and
Yakima.
Note: King County is recognized as having unique characteristics relative to other MSA
counties for purposes of determining reimbursement rates as stated in this policy.
Professional Services are services provided by staff (either as employees or contracted
personnel) including nurses, therapists and other licensed or specialized skills personnel and are
reimbursed at a non-standard rate as specified in Exhibit B of the contract.
Related Organization is either an entity, which is under common ownership, and/or control
with, has control of, or is controlled by, the contractor. An entity is deemed to "control" another
entity if one entity has a five (5) percent or greater ownership interest in the other; or if an entity
has the capacity (whether or not exercised) derived from a financial or other relationship to
influence directly or indirectly the activities of the other.
Related Party is a spouse; natural parent, child or sibling; adopted child or adoptive parent;
stepparent, stepchild, stepbrother, stepsister; father-in-law, mother-in-law, son-in-law, daughterin-law; grandparent or grandchild; uncle, aunt, nephew, niece or cousin of the contractor.
•
•
•
•
•
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL 5 of 17 ISSUED 7/11
Residential Services Program means a contractor's Group Home and Group Training Home or
Supported Living (SL) residential program providing services in accordance with Chapter
388-101 WAC and contract provisions.
Staff Lodging means SL programs that provide the primary residence for a staff person as a part
of their compensation package and may include the cost of the residence as ISS cost for cost
reporting purposes. Staff lodging does not include the cost of maintaining a residential unit for
the use of overnight staff when it is not their primary residence. The reporting of staff lodging
cost for this purpose must be consistent with Internal Revenue Service (IRS) rules for reporting
housing to employees as income.
Supported Living (SL) is included within the meaning of residential services as described in
Chapter 388-101 WAC and contract provisions.
POLICY
A. Contractors shall report costs of operations for purposes of providing data to the division
and to determine any settlements due.
B. The division shall:
1. Set standard rates for each cost center for programs covered within this policy;
2. Describe allowable costs and specify the reporting requirements;
3. Describe the rate setting methodology and principles that apply to programs;
4. Describe the settlement process as it applies to residential programs;
5. Describe the summer program requirements and payment procedures; and
6. Provide information on billing and payment requirements and procedures.
PROCEDURES
I. REPORTING
A. Cost Reports
1. In order for a contractor to receive payments under the residential
reimbursement system, the contractor must submit an annual DDD cost
report covering the completed calendar year.
2. If a contractor terminates from the residential program, the former
contractor shall submit a final annual report covering the period the
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDD POLICY MANUAL 6 of 17 ISSUED 7/11
contract was in effect during the calendar year. The final annual report
shall be used for determining a settlement for the final period.
B. Due Date of Report
1. The cost report shall be submitted on or before March 31 of the year
following the calendar year covered in the report.
2. Cost Report Extension Provisions
a. A thirty (30) day extension beyond the date specified above will be
granted to contractors upon written notification to the Office of
Rates Management (ORM) that the additional time is required to
complete the report. The notification shall include a brief
explanation of the circumstances that require the extension. An
approval from the department will not be required for this thirty
(30) day extension.
b. The department, upon a written request setting forth reasons for the
necessity of an extension beyond the thirty (30) day extension
specified above, may grant an additional thirty (30) day extension
for submitting the cost report. The request must be written and
received by the ORM prior to the due date as specified in „1‟ and
„2.a.‟ above. The ORM will respond to this request within ten (10)
working days from the date of receipt.
C. Completing Reports and Maintaining Records
1. Reports shall be completed in accordance with instructions provided by
the department. If no specific instruction covers a situation, generally
accepted accounting principles shall be followed.
2. The department may analyze the submitted cost report and financial
statement of each contractor to determine if the information is correct,
complete, and reported in conformance with generally accepted
accounting principles and the requirements of this contract and those
policies, rules and regulations referenced therein. If the analysis finds that
the cost report or financial statements are incorrect or incomplete, the
division may make adjustments to the reported information.
3. A schedule of adjustments shall be provided to contractors in writing and
shall include an explanation for the adjustments and dollar amounts of the
adjustments.
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a. If a contractor disagrees with an adjustment made under this
section, the contractor shall, in writing, identify specifically the
grounds for his/her contention that the adjustment is erroneous and
include any documentation that supports the contractor's position.
b. If the contractor wishes to challenge the division's determination of
the contractor's contention from subsection „a‟ above, the
contractor may request an administrative review pursuant to
Chapter 388-101 WAC and/or the dispute clause as described in
the general terms and conditions of the contract.
4. Contractors shall submit a single cost report that includes all business
activities related to the cost of providing contracted services.
5. Facilities with joint residential program costs shall allocate and report
shared costs to each residential program in accordance with allocation
policies prescribed or approved by the department.
6. If a contractor fails to maintain records adequate for audit purposes or fails
to allow inspection of such records by authorized personnel, the
department may suspend all or part of subsequent payments due under the
contract until compliance is forthcoming. Upon compliance, the
department shall resume contract payments and shall release suspended
payments pursuant to the contractor's contract.
7. Contractors shall maintain cost reports and records adequate for audit
purposes. If, at the end of the contract retention period as specified in the
work order, there are unresolved audit questions, the report will be
retained until such questions are resolved.
D. Report Certification
1. Each required report shall be accompanied by a certification signed on
behalf of the contractor responsible to the department during the report
period. If the contractor files a federal income tax return, the certification
shall be executed by the person normally signing this return. If the report
is prepared by someone other than an employee of the contractor, that
person‟s name and contact information shall be included with the
certification.
2. If a contractor knowingly files a report containing false information, such
action constitutes cause for termination of the contractor's contract with
the department. Contractors filing false reports may be referred for
prosecution under applicable statutes.
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DDD POLICY MANUAL 8 of 17 ISSUED 7/11
E. Improperly Completed or Late Reports
1. An annual cost report must be completed in accordance with applicable
department regulations and instructions. An annual cost report deficient in
any of these respects may be returned in whole or in part to the contractor
for proper completion.
2. If a report is not properly completed or is not received by the division on
or before the due date of the report, including any approved extensions, all
or a part of any payments due under the contract may be held by the
department until the improperly completed or delinquent report is properly
completed and received by the division.
II. REIMBURSABLE COSTS
A. Reimbursable Costs Definition
Reimbursable costs are documented costs that are necessary, ordinary and related
to the provision of client support, training and activities as prescribed in Chapter
388-101 WAC and contract.
B. Depreciable Assets
The following costs shall be reported as depreciable assets:
1. Expenditures for equipment, furnishings or vehicles with historical
acquisition cost in excess of $5,000 per unit and a useful life of more than
one (1) year from the date of purchase;
2. Expenditures for equipment or furnishings with historical acquisition
value of less than $300 per unit if the item was acquired in a group
purchase where the total acquisition cost exceeded $5,000 and has a useful
life of more than one (1) year from the date of purchase;
3. Expenditures for building, land and/or leasehold improvements which are
in excess of $5,000 and which extend the useful life of the asset; and
4. Expenditures for assets as described above with historical acquisition
value less than $5,000 may be reported as depreciable assets, or expensed
in the year they were purchased.
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C. Equipment and Building Expenses
The following costs shall be reported as expenses:
1. Those expenditures for equipment, furnishings, or building, land, or
leasehold improvements not subject to classification as a depreciable
asset; and
2. Repairs (damages) or maintenance (upkeep) costs that do not extend the
useful life or increase the value of the building, equipment, furnishings or
vehicles.
D. Reporting Depreciable Assets
1. Depreciable assets may include the following:
a. Building - The basic structure or shell and additions.
b. Fixed Equipment - Attachments to the building such as wiring,
plumbing, and heating system.
c. Movable Equipment - Such items as furnishings, beds, stoves,
refrigerators, silverware, and dishes.
d. Vehicles - Such items as automobiles or vans used to transport
residents to activities, training, or work.
e. Land Improvements - Such items as paving, on-site sewer and
water lines, parking areas, shrubbery, fences, government assets,
etc., where replacement is the responsibility of the Group Home
and Group Training Home.
f. Leasehold Improvement - Improvements and additions made by the
lessee (contractor) to the leased property, which become the
property of the lessor after the expiration of the lease.
2. Land is not a depreciable asset. Land includes the cost of such items as
off-site sewer and water lines, the cost of permanent roadways, curbs and
sidewalks, and utility hookups.
3. Depreciable assets shall be reported as follows:
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DDD POLICY MANUAL 10 of 17 ISSUED 7/11
a. The base used to calculate depreciation shall be:
(i) The historical cost to the contractor in acquiring the asset or
capitalized expense from an unrelated organization less the
estimated salvage value, if any; or
(ii) The fair market value of the donated or inherited asset or
asset purchased with restricted donation at the time of
donation or death less goodwill and salvage value, if any;
or
(iii) Assets or capitalized expenses acquired from a related
organization, which shall not exceed the lower of cost to
the related organization or the cost of comparable assets
purchased elsewhere.
b. The lives used to calculate depreciation expenses shall be:
(i) Building - Not less than thirty (30) years.
(ii) Building Improvements - The remaining useful life of the
building as modified by the improvement.
(iii) Other Assets - Lives no shorter than guideline lives
published by the IRS or by the American Hospital
Association.
(iv) Lives shall be measured from the date of the most recent
arm's-length acquisition of the asset.
c. The depreciation expense methodology used shall be acceptable by
generally accepted accounting principles and the IRS methodology
for the asset class being depreciated.
d. Changes in depreciation methodology during the life of the asset
must be disclosed on the annual cost report.
E. Interest
1. Interest is defined as necessary and ordinary interest for working capital
and capital indebtedness, which must be incurred for a financial need
related to resident care, training, and activities.
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2. Interest cost shall be at a rate not in excess of what a prudent borrower
would have to pay at the time of the loan in an arm's-length transaction in
the financial market.
3. Interest paid to a related organization shall not be reported in excess of the
cost to the related organization of obtaining the use of the funds.
F. Donations and Contributions
1. Donations or contributions are classified as:
a. Restricted: Grants, gifts, and income from endowments in the
form of purchasing power which must be used only for specific
purposes designated by the donor. Items whose nature restricts its
use, such as food, supplies, equipment, vehicles or building space.
b. Unrestricted: Grants, gifts, and income from endowments in the
form of cash or purchasing power given to the facility without
restriction by the donor.
c. Volunteer time and donated consultant time.
2. Donations or contributions are reported as follows:
a. The value of a restricted donation/contribution shall not be
reported as an expense on the cost report;
b. The value of an unrestricted donation/contribution shall be
reported in the expense account for which it was used through the
contractor's normal recording of transactions; and
c. The value of the volunteer/donated time shall not be reported as an
expense on the cost report.
G. Related Organization/Party Costs
1. Costs of services, facilities, and supplies furnished by related
organizations to the contractor shall be reported at the lower of the costs to
the related organization or the price of comparable services, facilities or
supplies purchased elsewhere.
2. The cost of a related party lease shall be reported based on the lower of
actual ownership cost (i.e., interest, depreciation, taxes, and insurance) to
the related party or the arm's-length lease to the related party.
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DDD POLICY MANUAL 12 of 17 ISSUED 7/11
H. Joint Program Costs
1. Joint program costs are defined as expenses benefiting more than one
program, or one program and any other entity.
2. Costs shall be allocated in accordance with cost reporting instructions.
I. Transportation Costs
1. Transportation costs are defined as:
a. Ordinary and necessary transportation of clients for training and
activities.
b. Ordinary and necessary transportation of employees for program
administration and operation.
c. Ordinary and necessary travel of employees for in-service training
and education.
2. The following costs shall be reported:
a. The costs of operating vehicles limited to automobiles, vans,
pickup trucks or buses that are used for the purposes defined in this
section, including maintenance, repairs and operation. A mileage
log shall be maintained detailing the usage of each vehicle not used
100 percent for the purposes defined in this section.
b. The costs of public transportation for clients, volunteers and staff,
which are for the purposes defined in this section.
c. The costs of mileage reimbursement of employees and volunteers
using their personal vehicle for actual mileage for the purposes
defined in this section.
d. Commuting between an employee's residence and their primary
place of employment shall not be included as transportation. If a
vehicle is used by any staff for travel that is not defined above,
these shall be fringe benefit costs for that employee.
3. The contractor shall not seek or accept additional compensation from or
on behalf of a client for any or all contracted residential services except:
a. The contractor shall notify DDD in writing when the client
contributes toward his/her costs for transportation.
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DDD POLICY MANUAL 13 of 17 ISSUED 7/11
b. Costs incurred by the contractor associated with this provision are
unallowable costs and shall not be reported on the annual cost
report.
J. Instruction and Support Services
1. ISS compensation for performance of ISS duties by an individual shall be
reported as ordinary compensation for necessary services actually
performed.
2. Compensation is ordinary when it is within a reasonable amount usually
paid to an individual with necessary qualifications for similar services
within the same or comparable programs.
3. A service is necessary if it would have had to be performed by another
person if the individual in question had not performed it.
4. The reported ISS compensation for an individual staff must not exceed the
reasonable amount criteria per item 2 above.
5. The division may request job descriptions for employees to verify the
primary duties of the positions. Paid hours worked and payroll costs
charged to ISS for cost reporting purposes must be verifiable in the
agency‟s records. The number of ISS paid hours reported for any
individual employee or owner of an agency must not exceed 3,120 hours
per year (designated live-in staff are exempt from this limitation). ISS
staff shall also include contracted personnel whose job function is the
provision of instruction and support services.
K. Fringe Benefits
Fringe benefits provided at the employer's expense may include sick leave, health
insurance, paid vacation, holiday pay, retirement plan, as well as other benefits, to
all employees who qualify.
III. SETTLEMENT
A. Settlement Definition
1. The settlement shall be for under utilization of contracted and paid service
hours and dollars in the instruction and support service cost center.
2. Settlements shall be based on department payment system(s) reports, the
contractor's financial reports, and/or other department-specified reports or
documents.
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3. The provisions of this section will apply to the settlement calculation for
the entire calendar year in which the contract is effective.
4. A settlement as described in this section is considered an overpayment as
defined in DSHS Administrative Policy No. 10.02, Overpayments and
Debts for Providers and Vendors:
“Overpayments and debts: is any department payment or benefit
to a vendor or provider in excess of the amount the provider or
vendor was entitled to by law, rule, or contract.”
B. Settlement Determination
The contractor shall refund the greater of:
1. All amounts of ISS cost center rate reimbursement in excess of the
allowable instruction and support service costs as defined in this policy,
and as reported in the contractor‟s annual cost report and/or departmentspecified documents.
2. Reimbursement amounts received from DDD for professional services and
professional services compensation paid by the contractor shall be
included in the settlement calculation. For purposes of the settlement
calculation, professional services reimbursement and compensation rates
exclude administration amounts that may be included in the hourly
professional service rate.
3. The total annual reimbursed hours for ISS and professional/licensed staff
minus actual total annual paid hours worked as reported in the contractor‟s
annual cost report and/or department-specified documents, multiplied by
the weighted average reimbursement benchmark rate for ISS staff in effect
during the settlement period.
4. Staff add-on reimbursements will be subject to the settlement provisions
of this policy.
5. Nurse Delegation Core Training Staff Class Hours and dollars that are
paid to an agency as reimbursement for agency staff time spent in
attending training will be subject to the settlement provisions of this
policy.
6. Reimbursement for agency staff time to attend training mandated through
legislation or initiative will be subject to the settlement provisions of this
policy.
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DDD POLICY MANUAL 15 of 17 ISSUED 7/11
7. Contractors not using all of their contracted ISS hours must provide
information as to why the hours were not used and document the attempts
to provide those hours. A plan to prevent future occurrences must be
submitted.
8. When submitting a cost report that includes a settlement, a contractor that
has had extraordinary ISS costs during the year may request to apply those
extraordinary costs toward the settlement. The agency making the request
may submit narrative justification and a breakdown of associated costs to
enable the division to analyze the request.
9. Contractors that have Administrative/ICS or Non-ISS rates above the
administrative rate standard for the reporting year will be required to
return the administrative dollars associated with unused contracted ISS
hours as determined by DDD. A worksheet showing the calculations to
determine the settlement is available on the DDD Internet website in the
Rates Management section of the Residential Provider Resources page at
this address: http://www.dshs.wa.gov/ddd/res_provider_resources.shtml.
The contractor may elect to have a two-year option for the administrative
rate settlement following the same criteria and procedures as described in
section F below.
C. Administrative Staff Hours Counted as ISS for Settlement Purposes
1. GH and GTH program administrators may provide ISS hours.
2. SL and combined programs (GH, GTH and SL):
a. For residential services programs that have twenty (20) or fewer
FTE employees that support clients during the settlement period,
settlements may include the program administrator's hours worked
in an ISS staff capacity. The cost that may be applied in the
settlement computation is the total hours worked as ISS staff
multiplied by the benchmark compensation rate in effect during the
period that the hours were worked.
b. For residential services programs that have more than twenty (20)
FTE employees that support clients during the settlement period,
settlements may not include administrator's hours worked in an ISS
staff capacity in their settlement computation.
c. The hourly rate allowed for the administrator‟s cost shall not
exceed the contractor‟s instruction and support staff compensation
rate as specified in the contractor‟s contract and rate notification.
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DDD POLICY MANUAL 16 of 17 ISSUED 7/11
d. An exception to item “b” above may be requested by any
contractor. A copy of the approved exception to policy (ETP)
must accompany the annual cost report if the administrative hours
are reported as ISS for settlement purposes.
D. Programs Combined for Settlement
1. Contractors that have contracts with the division for the operation of
multiple residential programs within a single region may collapse those
contracts into a single contract for any combination of GH and GTH and
SL programs. The single contract will identify the type(s) of residential
program(s) and all applicable rates.
2. Programs combined under a single contract will be treated as a single
entity for purposes of the settlement provisions of this policy. The
contractor may combine the total reimbursement for ISS hours and
compensation amounts subject to settlement per the contract, and the
combined total of paid ISS hours and compensation into a single
settlement calculation.
E. Settlement Process
The division will determine a settlement amount for each calendar year.
1. The contractor shall pay a settlement overpayment amount, or shall
commence repayment in accordance with a schedule determined by the
department, within thirty (30) days after receiving departmental
notification of the overpayment amount. If a settlement determination is
contested, the contractor shall pay or commence repayment within thirty
(30) days after such proceedings are concluded.
2. The department will pay any amount due the contractor as a result of
errors in billing or payment disclosed on the settlement within thirty (30)
days after issuance of departmental notification of the amount due the
contractor.
3. If the contractor does not refund the overpayment or any installment when
due, or after the final decision from any administrative or judicial remedy
sought by the contractor regarding the amount due, the department may
withhold payments from current billings until the overpayment is
refunded.
4. A proposed settlement may be revised by the department on the basis of
audit findings or DDD certification evaluation findings.
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DDD POLICY MANUAL 17 of 17 ISSUED 7/11
F. Optional Two-Year Settlement Process
1. The contractor may request to have an optional two (2) year settlement.
These settlements shall allow a collaborative process in order to minimize
settlements due.
2. Contractors will indicate on their first year cost report whether or not they
wish to participate in the optional two (2) year settlement process.
Contractors may initiate the planning process with the region during the
first year if preliminary data indicates that a settlement will materialize.
3. The request for a two-year optional settlement and plan must be sent in
writing to the Regional Administrator for review and consideration no
later than May 31 of the second settlement year. Example: For settlement
2011-2012, the request would be due by May 31, 2012.
4. A joint plan will be produced by June 15th of the second settlement year.
If no plan is agreed upon by this date, the first year settlement amount is
due according to the provisions of the previous settlement section.
5. Information derived from the first year's cost report will be used to
develop a joint plan for use of the unspent ISS dollars to be followed
during the second year of the settlement period. These funds will be used
to increase service capacity or extend services to additional people. Funds
retained through this process would be expended on direct supports rather
than agency administration costs.
EXCEPTIONS
Exceptions to this policy may be approved by the Division Director or her designee based upon
information submitted on DSHS 05-010, Rule Exception Request.
SUPERSESSION
DDD Policy 6.04
July 1, 2009
Approved: /s/ Linda Rolfe Date: July 1, 2011
Director, Division of Developmental Disabilities
CHAPTER 6
DDA POLICY MANUAL i of ii ISSUED 7/13
DEVELOPMENTAL DISABILITIES ADMINISTRATION
Olympia, Washington
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
Table of Contents
Page
AUTHORITY .................................................................................................................................1
PURPOSE .......................................................................................................................................1
SCOPE ............................................................................................................................................1
DEFINITIONS ...............................................................................................................................1
POLICY ..........................................................................................................................................5
PROCEDURES ..............................................................................................................................5
I. REPORTING .....................................................................................................................5
A. Cost Reports .............................................................................................................5
B. Due Date of Report ..................................................................................................6
C. Completing Reports and Maintaining Records ........................................................6
D. Report Certification .................................................................................................7
E. Improperly Completed or Late Reports ...................................................................8
II. REIMBURSABLE COSTS ...............................................................................................8
A. Reimbursable Costs Definition ................................................................................8
B. Depreciable Assets ...................................................................................................8
C. Equipment and Building Expenses ..........................................................................9
D. Reporting Depreciable Assets ..................................................................................9
E. Interest....................................................................................................................10
F. Related Organization/Party Costs ..........................................................................11
G. Joint Program Costs ...............................................................................................11
H. Transportation Costs ..............................................................................................11
I. Instruction and Support Services ...........................................................................12
11HK Washington State
7 Department of Social
& Health Services
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDA POLICY MANUAL ii of ii ISSUED 7/13
J. Fringe Benefits.......................................................................................................13
III. SETTLEMENT................................................................................................................13
A. Settlement Definition.............................................................................................13
B. Settlement Determination ......................................................................................14
C. Administrative Staff Hours Counted as ISS for Settlement Purposes...................15
D. Programs Combined for Settlement.......................................................................15
E. Settlement Process.................................................................................................16
F. Optional Two-Year Settlement Process.................................................................16
EXCEPTIONS..............................................................................................................................17
SUPERSESSION..........................................................................................................................17
CHAPTER 6
DDA POLICY MANUAL PAGE 1 OF 17 ISSUED 7/13
DEVELOPMENTAL DISABILITIES ADMINISTRATION
Olympia, Washington
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
Authority: Chapter 71A RCW Developmental Disabilities
Chapter 388-825 WAC Developmental Disabilities Services
Chapter 388-101 WAC Certified Community Residential Services and
Support
PURPOSE
This policy establishes procedures and criteria for cost reporting and the settlement process for
the Developmental Disabilities Administration (DDA) contracted residential programs.
SCOPE
This policy applies to DDA contracted and certified residential programs, which means
Supported Living (SL), Group Home (GH), and Group Training Home (GTH) services.
DEFINITIONS
Administration means the DSHS Developmental Disabilities Administration (DDA) and its
employees.
Administrative Staff means owners, officers or employees of the contractor, including
executive directors, administrators, accountants, bookkeepers, clerical support and/or secretaries
whose primary job functions require a majority of time for administrative, management and/or
operational support. Administrative staff may also include corporate staff whose time is
allocated to the contractor.
Arm’s-Length Transaction means a transaction resulting from good faith bargaining between a
buyer and seller who hold adverse positions in the market place. Arm’s-length transactions are
presumed to be objective transactions between disinterested parties (meaning neither the buyer
nor the seller has a financial incentive to buy or sell at a price more or less than market value).
Client means a person who has a developmental disability and is:
11HK Washington State
7 Department of Social
& Health Services
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDA POLICY MANUAL PAGE 2 OF 17 ISSUED 7/13
1. Eligible under RCW 71A.10.020; and
2. Authorized by DDA to receive residential services described in Chapter 388-101
WAC.
Client-Specific Staff Add-On means a staffing increase above and beyond the individual
instruction and support hours required and allowed in the standard rate provision of a contract,
enabling a contractor to increase the individual instruction and support hours provided to a
specific client.
Contract means a contract between the Department and a contractor for certified community
residential services to clients as described in Chapter 388-101 WAC.
Contractor means an entity contracting with the Department to provide certified community
residential services to clients as described in Chapter 388-101 WAC.
Cost-of-Care Adjustment means a reimbursement adjustment intended to cover the necessary
costs of non-variable staff support and administration to provide services to residents during a
time when their residence is temporarily not at full capacity.
Department means the Department of Social and Health Services (DSHS) and its employees.
Fringe benefits means benefits provided at the employer's expense to all employees who
qualify. These may include sick leave, health insurance, paid vacation, holiday pay, retirement
plan, and other benefits.
Full Time Equivalent (FTE) means a total of 2,080 hours (52 weeks x 40 hours) worked by one
or more employees during a twelve-month period.
Group Home (GH) Program is included within the meaning of residential services described in
Chapter 388-101 WAC and contract provisions. For purposes of this policy, “Group Training
Home” is synonymous with “Group Home.”
Group Training Home (GTH) means a certified non-profit residential program as per RCW
71A.22.020.
Housing Costs for Overnight Coverage means the costs of providing an apartment unit or other
dwelling used by staff when working 24-hour or longer duty shifts. The costs incurred by the
program for these housing costs are client support costs, and not to be reported as Instruction and
Support Services compensation.
Indirect Client Support Costs (ICS) include Maintenance/Repair expenses for client housing,
Client Transportation Expenses, and non-Instruction and Support Services Housing Costs for
Overnight Coverage.
TITLE: RESIDENTIAL PROGRAMS COST REPORTING POLICY 6.04
CHAPTER 6
DDA POLICY MANUAL PAGE 3 OF 17 ISSUED 7/13
Instruction and Support Services (ISS) means client services required by Chapter 388-101
WAC and contract provisions. ISS are provided by staff designated as ISS staff (see definition
below). ISS may also be provided by the administrator as described in this policy and by other
administrative personnel (such as bookkeepers, accountants or maintenance workers) if the
provision of ISS is included in their job description.
Instruction and Support Services (ISS) Staff means employees (including counselors,
instructors and/or trainers) of the contractor whose primary job function is the provision of
instruction and support services to clients. ISS staff shall include employees (e.g., program
managers and supervisors) of the contractor whose primary job function is the supervision of ISS
staff.
McAndrew v. Lockheed Martin Corp., 206 F.3d 1031 (2000)
16 IER Cases 25, 13 Fla. L. Weekly Fed. C 507
© 2020 Thomson Reuters. No claim to original U.S. Government Works. 6
(11th Cir.2000), a panel of this Court followed Chambliss
and held that the intracorporate conspiracy doctrine barred
plaintiff's § 1985(3) claim alleging a conspiracy among
employees of the same public entity to deprive him of his civil
rights. See id. Chambliss and Dickerson remain the law in this
Circuit. We have no occasion to revisit them today because
neither case addressed the precise question presented here:
whether the intracorporate conspiracy doctrine applies to and
bars claims alleging a criminal conspiracy among corporate
officers and the corporation itself arising under 42 U.S.C.
§ 1985(2). Neither case involved a claim brought under §
1985(2) and, more importantly, neither involved allegations
of a criminal conspiracy to deter by force, intimidation, or
threat an individual from testifying before a federal grand
jury.
SIDERIUS, LONERGAN & MARTIN, LLP
December 02, 2020 - 11:42 AM
Transmittal Information
Filed with Court: Court of Appeals Division I
Appellate Court Case Number: 79959-2
Appellate Court Case Title: State of Washington, Respondent v. Jason Lowery et al, Appellants
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Phone: (206) 624-2800
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