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Corey v. Norman, Hanson & DeTroy
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MAINE SUPREME JUDICIAL COURT Reporter of Decisions
Decision: 1999 ME 196
Docket: Cum-98-484
Argued: February 1, 1999
Decided : December 28, 1999
Panel: WATHEN, C.J., and CLIFFORD, RUDMAN, DANA, ALEXANDER and CALKINS, JJ.
SUSAN W. COREY
v.
NORMAN, HANSON & DETROY et al.
CLIFFORD, J.
[¶1] Susan W. Corey appeals from a summary judgment (Cumberland
County, Cole J.) entered in favor of the defendants. The court concluded
that Susan failed to establish the necessary elements to establish
malpractice in her action brought against the law firm of Norman, Hanson &
DeTroy and the accounting firm of Dawson, Smith, Purvis & Bassett, P.A.
(referred to collectively as NH&D). Susan contends that the trial court
erred in basing its decision to grant a summary judgment on what it
concluded was an insufficient statement of material facts filed by Susan
pursuant to M.R. Civ. P. 7(d)(2). Susan also appeals from an order (Saufley,
J.) requiring her attorney to return to the attorney for NH&D a document
that the trial court found to be privileged. She contends that the court
erred in finding that an inadvertent disclosure of a privileged document
does not constitute a waiver of the attorney-client privilege. We affirm both
the summary judgment and the court's order regarding the privileged
document.
[¶2] In the spring of 1995, Susan retained attorney Peter DeTroy of
NH&D to represent her in divorce proceedings against her then
husband John B. Corey, a dentist specializing in periodontics. DeTroy hired
Dawson, Smith, Purvis & Bassett, P.A., certified public accountants, to value
assets of the marital estate and to assist in distinguishing between marital
and nonmarital property for purposes of the divorce. The parties agreed
that John Corey's dental practice was marital property. DeTroy stipulated to
the $37,700 valuation of the dental practice proposed by John's attorney.
No formal appraisal of the dental practice was conducted by DeTroy or the
accountants he hired. The divorce was finalized in March of 1996. In the
divorce judgment, the stipulated value of the dental practice was accepted
by the court{1} and the practice was set aside to John. More than $1.6 million
in marital property was awarded to Susan. In addition, John was ordered to
pay his former wife alimony in excess of $300,000 over ten years.
[¶3] In January of 1997, Susan filed a complaint in the Superior Court
charging NH&D with professional negligence. Susan alleged that NH&D had
a duty to represent her "with reasonable care, skill and diligence possessed
and exercised by the ordinary attorney in similar circumstances" and a duty
to maximize her property distribution by "diligently consider[ing] and
valu[ing] all marital assets." According to Susan, NH&D breached that duty
by failing to obtain an independent valuation and by stipulating to the
$37,700 valuation of the dental practice. This breach, Susan alleges,
"caused the dental practice, a valuable marital asset, to be seriously
undervalued," thereby resulting in a property distribution to Susan "of
substantially less value than that to which she was entitled." The $37,700
figure to which NH&D stipulated was the value of the dental and business
equipment less debt, and did not account for the good will of the dental
practice, which, Susan contends, has a substantial value.
[¶4] After extensive discovery, NH&D filed a motion for a summary
judgment, contending:
As a matter of law, [Susan Corey] cannot prove any set of facts
under which [NH&D] may be liable to [Susan], because [Susan]
has no evidence that any act or omission by [NH&D] was the
proximate cause of any alleged damage to [Susan].{2}
In its M.R. Civ. P. 7(d)(1) statement of material facts supporting its motion
for a summary judgment, NH&D included excerpts from the deposition
testimony of Susan's designated legal expert, Robert Nadeau, that reflected
his reluctance to offer an opinion on proximate causation. Paragraphs 4 and
5 of NH&D's Rule 7(d)(1) statement read as follows:
4. Plaintiff has designated Robert M. A. Nadeau, Esq. as an
expert in this case. Mr. Nadeau is an attorney. . . .
5. Mr. Nadeau was specifically asked if he was prepared to
testify as to issues of proximate cause. He clearly and
unequivocally stated that he was not:
Q:When you expressed the opinion that has now been
refined, I guess I would describe it - when you
express that opinion in court, do you also intend to
express an opinion as to whether or not the claimed
failure to do whatever it is you say my client
[Defendant NH&D] should have done was the
proximate cause of anything?
A:I can't make a conclusion with respect to proximate
cause. That is a conclusion for the judge or the jury
to make when they hear all the facts. Again, I am not
privy to all the facts.
. . . .
Q:You're not going to offer any opinion as to whether
or not some conduct on the part of [Defendant
NH&D] was the proximate cause of some damage to
Mrs. Corey?
A:I am not aware that I have been asked to do that, no.
[¶5] In her opposition to NH&D's motion for a summary judgment,
submitted pursuant to Rule 7(d)(2), Susan relied on different excerpts from
Nadeau's deposition testimony:
Q:Have you . . . ever been asked by Mr. Waxman to evaluate
the settlement proposal that was advanced but ultimately
not accepted by Ms. Corey?
A:I may-I believe I was asked to offer an opinion as to
causation based on certain hypothetical information
presented to me by him, but I was, to the best of my
recollection, never asked to make any kind of comparisons
as to-or concerning the actual settlement versus
alternatives in the absence of the hypotheticals presented
to me.
Q:What hypothetical was presented to you?
. . . .
Q:All right. Well, you take your time [in finding the letter that
presented the hypothetical, if there was one] because I want to
know what if anything, you were asked to assume in the
hypothetical and then we'll move from there under what
conclusion, if any, you expressed.
. . . .
Q:As best you can recall [not finding the hypothetical in the
correspondence], describe the hypothesis that you believe
was presented to you.
A:I believe it was as simple as something to the effect of
assuming that Attorney DeTroy had failed to advise
Ms. Corey regarding the appropriateness of obtaining a
business valuation of the dental practice and, in particular,
the value of goodwill of the practice and assuming that we
can establish through an expert witness that that omission
had significant value to Ms. Corey, would you have an
opinion regarding whether such failure to advise the client
to obtain a complete business valuation of the practice
would be the proximate cause of whatever losses his
expert could establish . . . .
. . . .
Q:Basically the hypothesis was if he had gotten one, would it
have made a difference?
A:Assuming that he could establish through an expert-
Q:Right.
A:-there was an economic loss. It was basically a causation
type.
Q:And your answer to that was you couldn't express that opinion,
right?
A:No. My answer was assuming that you could establish there
would have been a loss, that, yes, I could-I would offer an
opinion that failure to advise a client-you could also establish
that there was, in fact, such a failure to advise-proximately
caused that loss.
[¶6] The Superior Court entered a summary judgment in favor of
NH&D based on Susan's failure to present sufficient evidence of any loss that
was proximately caused by negligence on the part of NH&D. Therefore, the
court concluded, her claim for damages was overly speculative. Susan has
appealed from that judgment.
I. SUMMARY JUDGMENT
[¶7] We review the entry of a summary judgment "for errors of law,
viewing the evidence in the light most favorable to the party against whom
the judgment was entered." Rodrigue v. Rodrigue, 1997 ME 99, ¶ 8,
694 A.2d 924, 926, quoted in Denman v. Peoples Heritage Bank, Inc.,
1998 ME 12, ¶ 3, 704 A.2d 411, 413. A summary judgment is properly
entered if
the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, referred to
in the statements required by Rule 7(d) show that there is no
genuine issue as to any material fact set forth in those
statements and that any party is entitled to a judgment as a
matter of law.
M.R. Civ. P. 56(c). "To survive a defendant's motion for a summary
judgment, a plaintiff must produce evidence that, if produced at trial would
be sufficient to resist a motion for a judgment as a matter of law." Rodrigue,
1997 ME 99, ¶ 8, 694 A.2d at 926, quoted in Prescott v. State Tax Assessor,
1998 ME 250, ¶ 4, 721 A.2d 169, 171.
[¶8] M.R. Civ. P. 7(d)(1) requires that "upon any motion for summary
judgment there shall be annexed to the motion a separate, short and concise
statement of the material facts, supported by appropriate record references,
as to which the moving party contends there is no genuine issue to be
tried." Id. Likewise, Rule 7(d)(2) requires a party opposing a summary
judgment to file "a separate, short and concise statement of the material
facts, supported by appropriate record references, as to which it is
contended that there exists a genuine issue to be tried."{3} See
M.R. Civ. P. 7(d)(2). In determining whether to grant or deny a motion for a
summary judgment, the trial court "is to consider only the portions of the
record referred to, and the material facts set forth, in the Rule 7(d)
statements." Handy Boat Serv., Inc. v. Professional Servs., Inc., 1998 ME
134, ¶ 12, 711 A.2d 1306, 1310, quoted in Prescott, 1998 ME 250, ¶ 5,
721 A.2d at 172. The statement of material facts requirement of Rule 7(d)
is designed to force litigants to narrowly frame their summary judgment
contentions, enabling the court to decide a summary judgment motion
without engaging in an exhaustive review of the record. See Gerrity Co., Inc.
v. Lake Arrowhead Corp., 609 A.2d 293, 295 (Me. 1992); see also Maine
Mut. Fire Ins. Co. v. Grant, 674 A.2d 503, 505 n.2 (Me. 1996) (citing M.R.
Civ. P. 7 advisory committee's note to 1990 amend., Me. Rptr., 563-575
A.2d LXXIII).
[¶9] To defeat NH&D's motion for a summary judgment, Susan was
required to include in her Rule 7(d)(2) statement of material facts
references to the record to establish the existence of any element of her
cause of action for which she bears the burden of proof at trial and for which
NH&D asserted there is no genuine issue of material fact. We have stated
generally that to resist a summary judgment motion "a plaintiff must
establish a prima facie case for each element of his cause of action." Barnes
v. Zappia, 658 A.2d 1086, 1089 (Me. 1995). By that statement, however, we
do not intend that a plaintiff must establish in the written material filed in
opposition to a motion for summary judgment a prima facie case for those
elements of the cause of action not challenged by the defendant. Cf. Binette
v. Dyer Library Ass'n, 688 A.2d 898, 903 (Me. 1996) (holding that where
defendant moved for a summary judgment and did not contest the first
element that plaintiff was required to prove, it was assumed that the plaintiff
had established a prima facie case for that element). A defendant moving for
a summary judgment has the burden to assert those elements of the cause of
action for which the defendant contends there is no genuine issue to be
tried. "[A] party seeking summary judgment always bears the initial
responsibility of informing the . . . court of the basis for its motion." Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986).{4}
[¶10] To prove attorney malpractice, a plaintiff must show: (1) a
breach by the defendant of the duty owed to the plaintiff to conform to a
certain standard of conduct; and (2) that the breach of that duty proximately
caused an injury or loss to the plaintiff. See Steeves v. Bernstein, Shur,
Sawyer & Nelson, P.C., 1998 ME 210, ¶ 12, 718 A.2d 186, 190. NH&D's
Rule 7(d)(1) statement was directed at the lack of a genuine issue of
material fact in one element of Susan's legal malpractice claim, namely,
proximate causation. Accordingly, in order to avoid a summary judgment
being entered against her on NH&D's motion, Susan was required to
establish a prima facie case only on proximate causation. In granting a
summary judgment in favor of NH&D the trial court concluded that Susan
failed to present sufficient evidence of loss proximately caused by NH&D's
conduct. It based that conclusion, in part, on the failure of Susan to include
in her Rule 7(d)(2) statement of material facts any evidence regarding the
good will value of the dental practice of John Corey. Susan concedes that
her 7(d)(2) statement does not contain direct evidence of the value of the
dental practice, but contends that because the focus of NH&D's Rule 7(d)(1)
statement of material facts in support of its motion for a summary judgment
was proximate causation as opposed to the value of the dental practice itself,
her response, directed at proximate causation, was sufficient.
[¶11] We agree with Susan that standing alone, the absence of direct
evidence of the valuation of the good will of John's dental practice in Susan's
Rule 7(d)(2) statement of material facts does not entitle NH&D to a
summary judgment. NH&D raises questions about the validity of the
appraisal of the dental practice by Susan's expert, and contends that there
was no negligence in accepting the value placed on the practice by John. Its
Rule 7(d)(1) statement of material facts, however, is not grounded on
Susan's failure to produce any evidence that the good will of a dental
practice can have substantial value,{5} but rather is focused on proximate
causation, and whether Susan could establish that any negligence NH&D may
have committed proximately caused her any loss. Thus, the absence of
direct evidence of the value of John's dental practice in Susan's Rule 7(d)(2)
statement of material facts is not in and of itself sufficient justification for
the entry of a summary judgment.
[¶12] That does not end our inquiry, however. NH&D contends that
it is entitled to a summary judgment because Susan has not presented
sufficient evidence of proximate causation, which is essential to proving
professional negligence. NH&D's Rule 7(d)(1) statement relies on the initial
deposition testimony of Susan's legal expert, and his statement that he
could not testify as to proximate causation. In Nadeau's further deposition
testimony, however, included in Susan's responsive Rule 7(d)(2) statement,
Nadeau asserts that he is prepared to testify as to proximate causation.
Nadeau testified that if someone else could establish Susan's loss, he would
testify that such loss was proximately caused by NH&D's failure to advise
Susan to evaluate the good will of the dental practice. Nadeau does not in
any way identify or describe the loss. Even viewing Nadeau's statement most
favorably to Corey, as we must do, see Denman, 1998 ME 12, ¶ 3, 704 A.2d
at 413, it is insufficient to establish proximate causation in the context of
this case.
[¶13] In order to avoid a summary judgment on NH&D's challenge to
the sufficiency of Corey's evidence regarding proximate causation, Susan
must show through expert testimony that the divorce judgment would have
been more favorable to Susan if the value of the dental practice had been
shown to be higher than the $37,700 agreed on by NH&D, i.e., that NH&D's
negligence resulted in the divorce judgment being less favorable to her, see
Schneider v. Richardson 411 A.2d 656, 658-59 (Me. 1979) (discussing
requirement that plaintiff prove a case within a case in order to recover for
legal malpractice in divorce representation).
[¶14] Susan's Rule 7(d)(2) statement points to no admissible
evidence to prove it more likely than not that the divorce judgment would
have been more favorable to Susan if the value of the dental practice was
shown to exceed the $37,700 value agreed on by NH&D. Nadeau makes a
general statement that he would testify about proximate cause, but he does
not offer an opinion that the trial court would have accepted the higher
value of the dental practice, or that if the court accepted a higher value, it
would have awarded any part of the increase to Susan, or that if it did award
a part of the increase to Susan, such increase would not be offset by a less
favorable award of alimony. Such evidence is essential to Susan's case, see
Marshak v. Ballesteros, 86 Cal. Rptr. 2d 1, 3-4 (Cal. Ct. App. 1999) (not
enough for plaintiff to allege possibility of a better outcome, but must prove
what the better outcome would have been). The Superior Court correctly
concluded that the lack of expert evidence in regard to a different outcome
absent NH&D's negligence makes "the link between [the negligent act] and
the alleged damage . . . overly speculative." See also Steeves, 1998 ME 210,
¶ 13, 718 A.2d at 190. Without a showing that the divorce judgment would
have been different, the factfinder would be compelled to speculate as to
proximate causation, and at a trial NH&D would be entitled to a judgment as
a matter of law. See Webb v. Haas, 1999 ME 74, ¶ 20, 728 A.2d 1261, 1267.
If at a trial NH&D would be entitled to a judgment as a matter of law, it is
entitled to the entry of a summary judgment in its favor. See id. ¶ 18, 728
A.2d at 1267. Prescott, 1998 ME 250, ¶ 4, 721 A.2d at 171.
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