Crist v. Loyacono
Docket Number: | 2009-CA-01547-SCT Linked Case(s): 2009-CA-01547-SCT |
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Supreme Court: | Opinion Link Opinion Date: 04-21-2011 Opinion Author: Dickinson, P.J. Holding: Reversed and remanded. |
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Additional Case Information: |
Topic: Legal malpractice - Proof of proximate cause - Expert testimony - Breach of fiduciary duty - Proof of damages - M.R.E. 702 - M.R.E. 801(c) - Out of court statement - Admissibility of matrix - M.R.E. 803 - M.R.E. 701 Judge(s) Concurring: Waller, C.J., Carlson, P.J., Randolph, Lamar, Kitchens, Chandler and Pierce, JJ. Non Participating Judge(s): King, J. Procedural History: Summary Judgment Nature of the Case: CIVIL - LEGAL MALPRACTICE |
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Trial Court: |
Date of Trial Judgment: 08-20-2009 Appealed from: Warren County Circuit Court Judge: Kosta N. Vlahos Disposition: The trial judge - finding that the lawyer's testimony and matrix were inadmissible hearsay, and that the clients were required to, but could not, prove they would have won their cases at trial - granted summary judgment. Case Number: 07,165-CI |
Party Name: | Attorney Name: | Brief(s) Available: | ||
Appellant: | Peggy Crist, Theresea Edwards, Patricia Guthrie, Jane Hamilton, Helen Heard, Bertha Mixon, Jennie Parker, James Reed, Jr., Glenda Rivers, Pamela Robinson, Karen Thornton, Virginia Townsend, Vera Wells, Mary Whittington, Linda Williams and Peggy Winters |
DAVID L. MINYARD, TIFFANY LEIGH KILPATRICK |
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Appellee: | Paul Kelly Loyacono and E. Scott Verhine | GLENN GATES TAYLOR, CHRISTY MICHELLE SPARKS |
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. |
Topic: | Legal malpractice - Proof of proximate cause - Expert testimony - Breach of fiduciary duty - Proof of damages - M.R.E. 702 - M.R.E. 801(c) - Out of court statement - Admissibility of matrix - M.R.E. 803 - M.R.E. 701 |
Summary of the Facts: | Sixteen former clients sued two lawyers who had represented them in mass-tort litigation, claiming the lawyers had breached their fiduciary duty by prematurely settling their cases in order to maximize attorney fees. Responding to a motion for summary judgment, the former clients produced a witness—a mass-tort lawyer whom the defendant lawyers had associated, and then fired—who testified that he had settled numerous similar cases for much more than the former clients received. The lawyer also produced a settlement document he had prepared, in part, by using another lawyer's matrix as a go-by. The court granted summary judgment for the defendants. The plaintiffs appeal. |
Summary of Opinion Analysis: | It is well established that a plaintiff in a negligence-based malpractice action must establish proximate cause by the so-called “trial-within-a-trial” test. That is to say, the client must show that, but for his attorney's negligence, he would have been successful in the prosecution or defense of the underlying action. The proof of proximate cause in such cases is to be tailored to the injury the client claims and the remedy he elects. This means that expert testimony is not always necessary. When a legal malpractice claim is based on an allegation of breach of fiduciary duty, the plaintiff must establish the existence of an attorney-client relationship; the acts constituting a violation of the attorney’s fiduciary duty; that the breach proximately caused the injury; and the fact and extent of the injury. Thus, the fiduciary-duty claims against Loyacono and Verhine survive, even absent a showing that the plaintiffs would have won the underlying Fen-Phen lawsuit against AHP. The defendant-attorneys argue in the alternative that summary judgment was proper because the plaintiffs’ only proof of damages—Keith Morgan’s settlement matrix and related testimony—is inadmissible. But even if the trial court properly excluded the matrix, it was not the only probative evidence of damages. In his deposition, Morgan testified regarding the amounts actually received by his clients from AHP. This testimony was not an out-of-court statement, and was sufficient to create a factual question for the jury. Thus, the grant of summary judgment as to the fiduciary-duty claims is reversed and remanded to the trial court for a ruling on the summary-judgment motion applying the proper standard. The trial court ruled that the settlement matrix prepared by Keith Morgan, along with all “related testimony” was inadmissible hearsay, inasmuch as it was partly based on a similar matrix prepared by another attorney. The court also apparently considered the matrix and related testimony to be opinion evidence within the scope of M.R.E. 702, and ruled that since Morgan was not designated as an expert, he could not give such opinions. The plaintiffs argue that the excluded evidence was fact, not opinion, and that Morgan’s testimony was based on personal knowledge and therefore not hearsay under M.R.E. 801(c). For an out-of-court statement to be admissible, it must either be offered for some other proper purpose, or fall into one of the enumerated exceptions to the general hearsay rule. The Morgan Matrix is obviously an out-of-court statement. Therefore, if offered for the purpose of establishing the fact of those classifications and settlement amounts, it would certainly constitute hearsay. The trial judge did not abuse his discretion in ruling that the Morgan Matrix was hearsay and therefore inadmissible as evidence. This holding is limited solely to the issue of the admissibility of the Morgan Matrix as evidence and is not meant as an opinion on the admissibility of the matrix for other purposes, such as those contemplated by the exceptions listed under M.R.E. 803. Unlike the matrix, Morgan’s in-court testimony about how he handled the settlement was not hearsay since it was not an out-of-court statement. The question then is whether Morgan needed to be qualified as an expert to offer his testimony. Under M.R.E. 702, expert witnesses may offer opinion testimony where scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue. Morgan was not qualified as an expert witness, but his testimony was based on personal knowledge. In other words, Morgan’s proffered testimony was a matter of fact rather than opinion, and the trial court erred in excluding it. The defendants argue (and the trial court found) that Morgan’s estimation of the value of his clients’ claims was “speculative” opinion testimony that may only be offered by an expert witness under M.R.E. 702. But the plaintiffs were not offering Morgan’s testimony to establish his opinion of the value of their claims. Rather, it was being offered to show how Morgan in fact distributed the settlement money to his clients. While those decisions may have been based on Morgan’s opinions at the time, the decision-making process and the resultant matrix was, and is, a matter of fact. Morgan’s past settlement-negotiation process is a matter of fact within Morgan’s personal knowledge and the rules provide no reason why he should not be allowed to testify about it. Therefore, it was not hearsay nor was it necessary to qualify Morgan as an expert before he could testify about the matter. But even if Morgan’s testimony did constitute opinion rather than fact, M.R.E. 701 allows a lay witness to offer opinion testimony that is rationally based on the perception of the witness, helpful to the clear understanding of the testimony or the determination of a fact in issue, and not based on scientific, technical, or other specialized knowledge within the scope of Rule 702. Morgan’s settlement-negotiation process is clearly based on Morgan’s perception and was helpful to the determination of a fact in issue— indeed, the trial court essentially ruled that the plaintiffs had no case without it. Since Morgan’s discretionary disbursement of the settlement funds to his clients did not implicate the kind of specialized knowledge implicated by Rule 702, to the extent his testimony constitutes opinion, it was admissible under Rule 701. |
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