Baker Donelson Bearman & Caldwell, P.C. v. Muirhead
| Docket Number: | 2004-CA-01558-SCT | |
| Supreme Court: | Opinion Link Opinion Date: 01-26-2006 Opinion Author: Dickinson, J. Holding: Reversed and Rendered |
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| Additional Case Information: |
Topic: Legal malpractice - Breach of duty - Insurance - Duty to defend Judge(s) Concurring: Smith, C.J., Waller and Cobb, P.JJ., Carlson and Randolph, JJ. Non Participating Judge(s): Diaz and Graves, JJ. Dissenting Author : Easley, J. Procedural History: Jury Trial Nature of the Case: CIVIL - LEGAL MALPRACTICE |
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| Trial Court: |
Date of Trial Judgment: 05-01-2004 Appealed from: Hinds County Circuit Court Judge: Tomie Green Disposition: Jury returned a verdict in favor of Appellee & awarded compensatory & punitive damages Case Number: 251-01-805CIV |
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| Note: | Nature of the Case: Legal Malpractice | |
| Party Name: | Attorney Name: | |||
| Appellant: | BAKER DONELSON BEARMAN & CALDWELL, P.C. |
FRED L. BANKS, LUTHER T. MUNFORD, DAMANY FREEMAN RANSOM, JAMES L. CARROLL,
CARLTON W. REEVES, J. DOUGLAS MINOR, JR. |
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| Appellee: | JACK MUIRHEAD, AS ASSIGNEE OF GREAT RIVER INSURANCE COMPANY | ERIC T. HAMER, PHILLIP J. BROOKINS, JOHN LEONARD WALKER |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Legal malpractice - Breach of duty - Insurance - Duty to defend |
| Summary of the Facts: | Gary Maddox filed a lawsuit claiming Jack Muirhead assaulted him in the parking lot of a bar. The jury returned a verdict for Maddox on a claim of assault. Muirhead filed a suit against his employer’s insurance carrier, Great River Insurance Company, claiming bad faith rejection of his post-trial demand for reimbursement of fees he paid an attorney to defend him in the Maddox suit. Great River did not believe Muirhead had coverage, but it sought advice from William Reed, a senior partner with Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C. Grounded on an opinion from Baker Donelson that Muirhead had no coverage, Great River denied his claim. After the trial judge granted summary judgment to Muirhead, Great River hired new attorneys and settled the bad faith suit by paying the employee $500,000 and assigning to him its potential legal malpractice claim against its former lawyers who advised against coverage. Muirhead then filed suit against Baker Donelson and obtained a judgment in the amount of $1,644,651.60. Baker Donelson appeals, and Muirhead cross-appeals. |
| Summary of Opinion Analysis: | In order to recover for legal malpractice, a plaintiff must prove by preponderance of the evidence the existence of a lawyer-client relationship, negligence on the part of the lawyer in handling his client's affairs entrusted to him, and some injury proximately caused by the lawyer’s negligence. To show negligent conduct (breach of duty), the plaintiff must prove by a preponderance of the evidence that a reasonable prudent lawyer faced with the same circumstances would either have done something the defendant did not do, or would have refrained from doing something the defendant did. Baker Donelson informed Muirhead’s counsel that Muirhead had no coverage under the Great River policy because, in its opinion: (1) Maddox’s injuries were not the result of an “accident,” as specifically required for coverage under the policy; (2) Muirhead was not a covered employee at the time of the altercation because he was not acting within the scope of his employment and was not performing duties related to Empire’s business; and (3) the harm inflicted by Muirhead upon Maddox was not covered because of the policy’s exclusion for bodily injury expected or intended from the standpoint of the insured. This advice, under the circumstances, was entirely reasonable and appropriate. Muirhead argues that Baker Donelson should have advised Great River it had a duty to defend him in the Maddox lawsuit and, therefore, Great River should reimburse his attorney fees. An insurance company’s duty to defend its insured is triggered when it becomes aware that a complaint has been filed which contains reasonable, plausible allegations of conduct covered by the policy. However, no duty to defend arises when the claims fall outside the policy’s coverage. Muirhead was not a named insured. Therefore, Baker Donelson could not properly advise Great River to provide Muirhead a defense unless the facts and policy provisions indicated not only that the claims were covered by the policy, but also that Muirhead was an insured. Baker Donelson’s advice to Great River was reasonable, prudent and appropriate, and the trial court abused its discretion in allowing this case to go to the jury. Where, as here, it is later conclusively determined that the claimant was not an insured, and the insurance policy did not provide coverage for the claims, an insurance company has no duty, contractual or otherwise, to provide a defense or to reimburse attorney fees already expended. |
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