Apr 22 2015, 9:36 am
ATTORNEYS FOR APPELLANT ATTORNEY FOR APPELLEE
David T. Kasper Jon R. Pactor
Julia Blackwell Gelinas Indianapolis, Indiana
Maggie L. Smith
Frost Brown Todd LLC
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Timothy Devereux, April 22, 2015
Appellant/Cross-Appellee/Defendant, Court of Appeals Case No.
49A02-1404-CT-260
v. Appeal from the Marion Superior
Court
The Honorable Patrick L. McCarty,
Jim and Diana Love, Judge
Appellees/Cross-Appellants/Plaintiffs Cause No. 49D03-1209-CT-35875
Bradford, Judge.
Case Overview
[1] One of the blocks of the foundation of America is an individual’s ability to seek
to right a wrong through the courts of justice. In a civil case, a plaintiff entrusts
his plight and cause to his attorney. The instant matter involves the disturbing
tale of a husband and wife whose confidence and trust was betrayed by the very
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attorney to which they had entrusted their cause of action. The just and normal
inclination in such a matter is to punish the wrongdoer and make the victims
whole. While William Conour, i.e., the wrongdoer, has been punished and
now occupies his appropriate place in federal prison, to date, it appears that
these victims have not been made whole for the misdeeds inflicted upon them.
[2] In an attempt to redress this wrong, Appellees/Cross-Appellants/Plaintiffs Jim
and Diana Love (collectively, the “Loves”) now seek relief from
Appellant/Cross-Appellee/Defendant Timothy Devereux, a former member of
Conour’s law practice. However, in light of the facts of this particular case, we
find that Devereux satisfied his legal duty to the Loves based on his lack of
knowledge of any specific wrongdoing by Conour relating to the Loves. We
therefore reverse the judgment of the trial court in this regard and remand the
matter to the trial court with instructions that the trial court grant summary
judgment in favor of Devereux.
Facts and Procedural History
I. William Conour, the “Wrongdoer”
[3] On April 27, 2012, William Conour “was charged by criminal complaint in the
United States District Court for the Southern District of Indiana with
misappropriating client funds in violation of 18 U.S.C. § 1343.” Minnesota
Lawyers Mut. Ins. Co. v. Conour, No. 1:12-CV-1671-WTL, 2014 WL 5089290, at
*1 (S.D. Ind. Oct. 8, 2014). “The complaint alleged, in part, that Conour ran a
so[-]called ‘Ponzi scheme’ with clients’ settlement funds and converted a large
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portion of those settlement funds to his own use and benefit.” Id. “Shortly
thereafter, the Disciplinary Commission of the Supreme Court of Indiana
instituted disciplinary proceedings against Conour.” Id. “Conour eventually
resigned from the Indiana Bar.” Id. On June 29, 2012, the Indiana Supreme
Court issued a published order accepting Conour’s resignation from the Indiana
Bar. In re Conour, 969 N.E.2d 1008 (Ind. 2012). On August 13, 2012, the
United States Supreme Court issued an order suspending Conour from
practicing law before the Court. In re Discipline of Conour, 133 S. Ct. 88 (2012).
[4] On July 15, 2013, Conour pled guilty to one count of wire fraud.
During his change of plea hearing, he admitted that:
Beginning as early as 1999 and continuing through April
2012, in Hamilton and Marion Counties and elsewhere in
the Southern District of Indiana, [he] ... knowingly
devised and participated in a scheme to defraud and to
obtain money and funds from his clients and others by
means of materially false and fraudulent pretenses,
representations, and promises ...
It was part of the scheme that after receiving settlement
funds on behalf of some clients, [he] convinced the clients
to accept monthly payments over a period of years rather
than to accept a lump sum payment. [He] created trust
accounts for the clients through State Bank & Trust, doing
business as Reliance Financial Services, and Ohio
Financial Institution, to facilitate the monthly payments.
Rather than depositing the entire amount of settlement
funds with Reliance, [he] funded the trusts only on a
yearly basis, thereby unlawfully keeping for his own use
and benefit the bulk of the settlement proceeds totaling
more than $3 million.
It was further part of the scheme that after receiving
settlement funds on behalf of some clients, [he] failed to
notify the clients that he had received settlement funds on
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their behalf, and in some cases falsely denied that he had
received any settlement funds. Thereafter, [he]
unlawfully converted the settlement funds to his own use
and benefit and, in part, used the settlement funds
obtained for some clients to make settlement payments to
other clients.
It was further part of the scheme that [he] stole,
misappropriated, and unlawfully converted to his own use
more than $4,500,000 belonging to more than 25 clients.
On or about October 6, 2011, in the Southern District of
Indiana and elsewhere, [he], for the purpose of executing
the above-described scheme, knowingly caused to be
transmitted in interstate commerce, by wire
communication, certain writings, signs, and signals,
namely a facsimile transmission from his office in
Indianapolis, Indiana to Zurich American Insurance in
New Jersey, which contained [a client’s] release and
indemnification agreement.
Dkt. No. 155–5 at 12–14. Conour was thereafter sentenced to 120
months in prison and ordered to pay restitution to the client-victims.
Conour, No. 1:12-CV-1671-WTL, 2014 WL 5089290, at *1-2.
II. Conour’s Representation of the Loves
[5] On May 13, 2008, Jim was injured at work. A few months later, in August of
2008, the Loves hired Conour Law Firm (the “Firm”) to represent them in a
personal injury lawsuit against Meyer & Najem Construction, LLC.
Unfortunately, the Loves subsequently became victims of Conour’s above-
described illegal acts when he settled their personal injury lawsuit without their
knowledge in February of 2012.
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III. Devereux’s Representation of the Loves and the
Termination of Devereux’s Employment at the Firm
A. Events Occurring Prior to December of 2011
[6] In February of 2008, Devereux joined the Firm as an Associate Attorney.
Devereux was subsequently assigned, by Conour, to work with Conour on the
Loves’ personal injury case.
[7] In early July of 2010, the Loves received a letter dated July 1, 2010, which read
as follows:
We are pleased to introduce you to the new law firm of Conour
Devereux Hammond[1] which is taking over the cases and business of
Conour Law Firm, LLC. Of course, you already know all of us
because we have been working with you on your case since its
beginning. Your existing contract with the Conour Law Firm will be
fully honored by the new firm and we are continuing to represent you
as your attorneys.
Conour Devereux Hammond will represent you in the same
professional and excellent manner as the Conour Law Firm.
However, upon the formation of a new law firm, even though it may
include the same lawyers as the previous law firm, we are required by
the Indiana Rules of Professional Conduct for Attorneys to give you
the option of selecting other counsel to represent you.
We presume you will want us to continue as your attorneys and, if that
is true, then you do not have to respond to this letter; but if you do
wish to find other counsel you must notify us within ninety (90) days
of the date of this letter.
1
We will continue to refer to this new firm as the “Firm.”
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We look forward to continuing to work with you to the conclusion of
your claim. If you have any questions or wish to discuss this matter,
please call any one of us. Thanks.
Appellant’s App. p. 67.2 The letter was signed by Conour, Devereux, and
Jeffrey Hammond. Despite the July of 2010 change of the Firm name to
include Devereux’s name, Devereux subsequently averred, without contest, that
he never had any ownership interest in the Firm, that he was never a signatory
on any of the Firm’s bank accounts, and was not provided access to any of the
Firm’s financial records.
B. Events Occurring During December of 2011
[8] At some point in December of 2011, Devereux decided to terminate his
employment with the Firm due to concerns he had regarding Conour’s failure
to timely pay expenses and expert witness fees, which was hampering
Devereux’s ability to adequately and timely prepare cases for trial in cases other
than the Loves’ matter. In addition, on December 21, 2011, after deciding to
leave the Firm, Devereux became aware that a Case Verification Report, which
had been prepared by Conour and sent to Advocate Capital,3 contained
inaccurate and misleading information. Also on December 21, 2011, Devereux
2
It appears that the Loves elected to stay with the Firm as Devereux and Conour
continued to represent the Loves in their personal injury case.
3
It appears that Advocate Capital is a company that had a financial interest in certain
of the Firm’s cases because it advanced litigation expenses to the Firm for said cases.
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became aware that Conour had not delivered the settlement proceeds from a
wrongful death case to a client, the settlement for which had been approved by
the trial court in early June of 2011.
[9] Devereux resigned from his position of employment with the Firm on
December 22, 2011. On this date, Devereux delivered a letter to Conour which
read: “I am terminating my employment with your law firm effective December
22, 201[1].… In addition, please remove me from the firm’s name immediately
including but not limited to the firm’s letter head, the firm’s website, all signage
at the office and all marketing materials.” Appellant’s App. p. 120.
[10] Devereux averred that based upon his experience with the Firm, “whenever an
attorney left their employment with the Firm, the Firm would prepare and file
Withdrawals of that attorneys [sic] Appearance on all of the Firm’s cases.”
Appellant’s App. p. 111. Devereux further averred that he “saw this practice
occur firsthand after both John Daly and Jeffrey Hammond left their
employment as attorneys with the [Firm].” Appellant’s App. p. 111. Devereux
also averred that it was his understanding that, upon his resignation, the Firm
did prepare and file withdrawals of his appearance on all of the Firm’s cases
and that he was advised by the office staff at the Firm that the withdrawals of
his appearance had, in fact, been prepared shortly after he resigned.
[11] On December 23, 2011, Conour informed the Loves, via letter, that Devereux
was “no longer an employee with [Conour’s] law firm.” Appellant’s App. p.
101. The December 23, 2011 letter further stated:
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Not always, but occasionally when an attorney leaves a law firm he or
his new employer may contact the law firm’s clients to try to convince
the client to let the attorney take their file rather than leave it with the
law firm they were referred to in the first place. I don’t know if Mr.
Devereux will attempt to contact you to take your case, but he might.
You are not to be contacted in person or by phone but only by letter
should he attempt to contact you. You have the choice to remain with
me in my firm where you were first referred or to have your file sent to
Mr. Devereux whenever he finds new employment or to have your file
sent to a new attorney. Of course, I think it is in your best interest to
remain with me since we have handled your case from the beginning
and you were referred to me and no one else.
For your convenience I have enclosed a form for you to indicate
whether you wish me and my firm to remain your attorneys or if you
want your file sent to Mr. Devereux or some other attorney. I have
also enclosed a stamped, self-addressed envelope for returning the
dated and signed form to me. I am sorry to bother you with this
during the holiday season but it is best to get this settled immediately
so we do not have any gaps in your legal representation.
Appellant’s App. p. 101. The Loves subsequently signed the form indicating
that they wished for Conour and the Firm to continue to represent them.
[12] After leaving the Firm, Devereux joined the law firm of Ladendorf &
Ladendorf. On December 29, 2011, Devereux sent a letter to the Loves in
which he informed them that he was no longer employed by the Firm. The
December 29, 2011 letter also stated the following:
I am pleased to let you know that Julie Durbin and I have joined the
law firm of Ladendorf & Ladendorf in Indianapolis, Indiana.
Ladendorf & Ladendorf is a well-respected firm with an excellent
reputation of experience, commitment, dedication and aggressive
representation of its clients. We are very excited about this
opportunity and the ability to continue working together. We are also
very interested in continuing to represent you on your case. As you
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know, we have been involved in the preparation and prosecution of
your case.
Under Indiana law, you have the absolute right to use the attorney of
your choice and I would be glad to continue to represent you in the
future should you wish. In the event that you do chose to have me
continue to represent you with the assistance of Julie, the amount of
the attorney fees set forth in the original Attorney Fee Agreement will
remain the same. You need only send a letter to the Conour Law
Firm advising it that you have chosen to have me continue to represent
you on your case along with Julie’s assistance.
On behalf of Julie and myself, it has been a privilege and a pleasure
getting to know you and we look forward to continuing to work with
you on your case in the future. Should you have any questions or
concerns regarding your choice, please feel free to contact Julie or me
at your convenience.
Appellant’s App. p. 126. Devereux received no response from the Loves
regarding the December 29, 2011 letter.
C. Events Occurring After December of 2011
[13] On January 20, 2012, Devereux received an email from Conour in which
Conour informed him that other than a few specifically named clients, the
remainder of the clients had chosen to remain with the Firm. Conour also
instructed Devereux to have no further contact with clients represented by
Conour or the Firm. The Loves were not one of the specifically mentioned
clients, but rather were among the group of clients that had chosen to remain
with the Firm.
[14] Sometime in early April of 2012, Devereux was contacted by the clerk of
Hendricks County Superior Court 4 regarding an upcoming pre-trial conference
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that was scheduled in the Loves’ case. Devereux averred that this contact was
when he first learned that the Firm had not filed his withdrawal in the Loves’
case. Devereux immediately filed a request to withdraw his appearance in the
Loves’ case.
IV. Devereux’s Cooperation with the Indiana Supreme
Court Disciplinary Commission (the “Disciplinary
Commission”) and the Federal Bureau of Investigation
(the “FBI”)
[15] On December 27, 2011, Devereux contacted the Indiana Supreme Court
Disciplinary Commission (the “Disciplinary Commission”) to request a
meeting regarding his concerns relating to Conour. On December 30, 2011,
Devereux submitted a letter to the Disciplinary Commission setting forth his
concerns regarding Conour. Devereux also repeated his request for a meeting
with the Disciplinary Commission to discuss his concerns.
[16] On January 9, 2012, Devereux was contacted by Special Agent Doug Kasper of
the FBI and was asked to assist the FBI in an ongoing investigation of Conour.
That same day, Devereux met with Special Agents Kasper and Andrew Shank
and learned that the FBI was investigating Conour for failing to properly fund
annuities for clients arising out of personal injury settlements generated by cases
handled by the Firm. Devereux subsequently met with Special Agents Kasper
and Shank several times over the next two-to-three weeks and assisted them in
their investigation. Devereux averred that to his knowledge, the conduct being
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investigated by the FBI related only to the funding of structured settlements and
did not involve any other potential wrongdoing.
[17] Devereux met with Michael Witte and Robert Shook of the Disciplinary
Commission on January 10, 2012. During this meeting, Devereux reported his
concerns regarding Conour as were outlined in his December 30, 2011 letter.
Devereux also shared the information that he had learned from his meeting
with FBI Special Agents Kasper and Shank the day before regarding the FBI’s
suspicions that Conour was not properly funding clients’ annuities.
[18] On February 24, 2012, Devereux became aware that Conour had settled a case
without the clients’ knowledge after he contacted the insurance adjuster
assigned to the case to inform the adjuster that he was taking over from the
Firm. During the conversation, the adjuster informed Devereux that Conour
had settled the case in October of 2011, that the adjuster had received a signed
release from Conour, and that the settlement draft of $450,000.00 had been
deposited by Conour in October of 2011. The adjuster emailed Devereux a
copy of the release provided to him by Conour and a copy of the cancelled
check.
[19] Later that day, Devereux met with the clients and showed them the
documentation provided by the adjuster. The clients confirmed that they had
never seen or signed the release in question and had never given Conour
authority to settle their claim. The clients further confirmed that they had never
been informed by Conour that their case had been settled or received any
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settlement payment. After speaking with the clients, Devereux contacted both
the FBI and the Disciplinary Commission to report the newly learned
information.
V. Devereux Notified that Conour Settled the Loves’
Case Without Their Consent
[20] On July 20, 2012, the Loves’ current counsel sent Devereux a letter informing
him that Conour had settled the Loves’ case in February of 2012, without the
Loves’ consent or knowledge, for the sum of $120,000. The letter indicated that
the settlement check was dated February 9, 2012, that Conour deposited the
check into his IOLTA trust account, and that the check cleared on February 9,
2012. The letter further indicated that Conour asked the Loves to sign a
settlement disbursement sheet in May of 2012, but that they had not, to date,
received any settlement funds.
[21] The July 20, 2012 letter also asserted that Devereux, in his position as one of
the Loves’ counsel of record, had a duty to inform the Loves of his knowledge
that Conour “was in serious ethical and criminal predicaments and that the
Loves were in peril of being victimized.” Appellant’s App. p. 129. The letter
alleged that Devereux had breached this duty and threatened Devereux with a
malpractice action if he did not pay the Loves the proceeds of the settlement
“that they should have received and for the proceeds that may not have been
paid to third parties such as lien holders.” Appellant’s App. 129.
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[22] Devereux subsequently responded to the July 20, 2012 letter. In his response,
Devereux stated that at the time he terminated his employment with the Firm,
he “had no reason to know, did not know and could not have known that
[Conour] would settle a client’s case without their knowledge and then keep the
settlement proceeds for himself.” Appellant’s App. p. 111. Devereux also
asserted that (1) he did not owe the claimed duty to the Loves as, at the time he
terminated his employment with the Firm, he did not have knowledge that
Conour was facing serious ethical and criminal predicaments that would place
the Loves at peril for being victimized; and (2) any duty owed to the Loves was
extinguished when his representation of the Loves ended when he terminated
his employment at the Firm.
[23] In making these assertions, Devereux indicated that he had no access to any
part of the Loves’ case file or materials after he terminated his employment at
the Firm on December 22, 2011, and that he had not had any involvement in
the Loves’ case since that date. Devereux further indicated that he was not
aware of and did not participate in the February 2012 settlement of the Loves’
case, was not copied on any correspondence between the Firm and counsel for
the defendant, and was not aware that the Loves’ case had been settled by the
Firm until he was contacted by the Loves’ current counsel on July 20, 2012.
VI. Procedural History
[24] On September 12, 2012, the Loves filed an action against Devereux. In their
Amended Complaint, the Loves alleged that Devereux had breached certain
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duties owed to them by not informing them of his suspicions regarding
Conour’s conduct when Devereux terminated his employment at the Firm.
The parties subsequently filed competing motions for summary judgment. The
Loves and Devereux both filed motions to strike certain affidavits submitted by
the other party. On February 10, 2014, following a hearing, the trial court
denied the parties’ competing motions for summary judgment and motions to
strike.
[25] Devereux subsequently requested that the trial court certify its interlocutory
order for appeal. On March 17, 2014, the trial court certified its February 10,
2014 order for interlocutory appeal over the Loves’ objection. On May 23,
2014, we granted Devereux’s motion to accept jurisdiction of interlocutory
appeal. This interlocutory appeal follows.
Discussion
I. Summary Judgment
A. Standard of Review
[26] Pursuant to Rule 56(C) of the Indiana Rules of Trial Procedure, summary
judgment is appropriate when there are no genuine issues of material fact and
when the moving party is entitled to judgment as a matter of law. Heritage Dev.
of Ind., Inc. v. Opportunity Options, Inc., 773 N.E.2d 881, 887 (Ind. Ct. App.
2002).
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“On appeal from the denial of a motion for summary judgment, we
apply the same standard applicable in the trial court. Summary
judgment is appropriate only if there is no genuine issue as to any
material fact and the moving party is entitled to judgment as a matter
of law. Ind. Trial Rule 56(C). We therefore must determine whether
the record reveals a genuine issue of material fact and whether the trial
court correctly applied the law. A genuine issue of material fact exists
where facts concerning an issue, which would dispose of the litigation
are in dispute, or where the undisputed material facts are capable of
supporting conflicting inferences on such an issue. If the material facts
are not in dispute, our review is limited to determining whether the
trial court correctly applied the law to the undisputed facts. When
there are no disputed facts with regard to a motion for summary
judgment and the question presented is a pure question of law, we
review the matter de novo.”
Clary v. Lite Machines Corp., 850 N.E.2d 423, 430 (Ind. Ct. App. 2006) (quoting
Bd. of Tr. of Ball State Univ. v. Strain, 771 N.E.2d 78, 81-82 (Ind. Ct. App. 2002)
(internal quotation marks and some citations omitted)).
[27] “‘In reviewing cross-motions for summary judgment, we consider each motion
separately.’” Alva Elec., Inc. v. Evansville-Vanderburgh Sch. Corp., 7 N.E.3d 263,
267 (Ind. 2014) (quoting Girl Scouts of S. Ill. v. Vincennes Ind. Girls, Inc., 988
N.E.2d 250, 253 (Ind. 2013)).
A party seeking summary judgment bears the burden to make a prima
facie showing that there are no genuine issues of material fact and that
the party is entitled to judgment as a matter of law. American
Management, Inc. v. MIF Realty, L.P., 666 N.E.2d 424, 428 (Ind. Ct.
App. 1996). Once the moving party satisfies this burden through
evidence designated to the trial court pursuant to Trial Rule 56, the
non-moving party may not rest on its pleadings, but must designate
specific facts demonstrating the existence of a genuine issue for trial.
Id.
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Heritage Dev., 773 N.E.2d at 888. “On appeal, the trial court’s order granting or
denying a motion for summary judgment is cloaked with a presumption of
validity.” Van Kirk v. Miller, 869 N.E.2d 534, 540 (Ind. Ct. App. 2007), trans.
denied. However, we are not limited to reviewing the trial court’s reasons for
granting or denying summary judgment but rather may affirm the trial court’s
ruling if it is sustainable on any theory found in the evidence designated to the
trial court. See Alva Elec., 7 N.E.3d at 267 (citing Wagner v. Yates, 912 N.E.2d
805, 811 (Ind. 2009)).
B. Analysis
1. Overview of Relevant Authority Relating to the Duty Owed By an Attorney
to a Client
[28] “Under Indiana Law, the elements of legal malpractice are: (1) employment of
an attorney, which creates a duty to the client; (2) failure of the attorney to
exercise ordinary skill and knowledge (breach of the duty); and (3) that such
negligence was the proximate cause of (4) damage to the plaintiff.’” Van Kirk,
869 N.E.2d at 541 (quoting Clary, 850 N.E.2d at 430). “A defendant is entitled
to judgment as a matter of law when the undisputed material facts negate at
least one element of the plaintiff’s claim.” Clary, 850 N.E.2d at 430.
“‘Proximate cause requires that there be a reasonable connection between the
defendant’s allegedly negligent conduct and the plaintiff’s damages. Proximate
cause requires, at a minimum, that the harm would not have occurred but for
the defendant’s conduct.’” Id. (quoting Gates v. Riley ex rel. Riley, 723 N.E.2d
946, 950 (Ind. Ct. App. 2000) (internal citations omitted)).
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[29] The existence of a duty is generally a question of law for the court to
decide. N. Ind. Pub. Serv. Co. v. Sharp, 790 N.E.2d 462, 466 (Ind. 2003).
Where an alleged duty is well established, there is no need for a
judicial redetermination of duty. Paragon Family Rest. v. Bartolini, 799
N.E.2d 1048, 1053 (Ind. 2003). Whether a particular act or omission
amounts to a breach of an attorney’s duty is generally a question of
fact for the jury. [Oxley v. Lenn, 819 N.E.2d 851, 856 (Ind. Ct. App.
2004)]. However, breach can become a question of law where the
facts are undisputed and only a single inference can be drawn
therefrom. Id.
In re Estate of Lee, 954 N.E.2d 1042, 1046-47 (Ind. Ct. App. 2011).
[30] It is a basic principle of professional conduct that an attorney must
faithfully, honestly, and consistently represent the interest and protect
the rights of his client, and that he is bound to discharge his duties to
his client with the strictest fidelity, to observe the highest and utmost
good faith, and to inform his client promptly of any known
information important to him.
Blasche v. Himelick, 140 Ind. App. 255, 260, 210 N.E.2d 378, 381 (1965)
(internal quotation omitted).
[31] Again, in order to succeed in a legal malpractice claim, the plaintiff must prove,
among other things, that the attorney breached his duty to the client. Van Kirk,
869 N.E.2d at 544 (citing Clary, 850 N.E.2d at 432). In Indiana, an attorney is
generally required to “‘exercise ordinary skill and knowledge.’” Id. (quoting
Rice v. Strunk, 670 N.E.2d 1280, 1284 (Ind. 1996)). An attorney also has a duty
to protect and preserve the rights and property of his client. In re Estate of Lee,
954 N.E.2d at 1047. In addition, an attorney “owes his client a duty, when
withdrawing from representation, to withdraw in the manner least harmful to
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the client in order to protect the client’s interests.” Bell v. Clark, 653 N.E.2d
483, 490 (Ind. Ct. App. 1995).
2. Application of the Relevant Authority to the Instant Matter
i. Potential Breach Committed Prior To and at the Time of Devereux’s
Departure from the Firm
[32] As is set forth above, the instant matter involves deceit and theft of client funds
by Conour, who, at the time, was a highly-respected member of the Indiana
legal profession. Hindsight proves that Conour was not worthy of this high
level of respect but, rather, was a thief who violated the trust and confidences
that numerous clients, including the Loves, had placed in him. In reviewing the
claims of legal malpractice set forth herein against Devereux, however, we must
not view the matter through the lens of hindsight, but rather must look to what
Devereux knew at the time he is alleged to have committed legal malpractice by
failing to warn the Loves of Conour’s potential wrongdoing.
[33] Devereux acknowledges that he had a duty to exercise ordinary skill and
knowledge in relation to his representation of the Loves while serving as one of
their counsel of record. Devereux contends, however, that his decision not to
discuss his concerns regarding Conour with the Loves did not amount to a
breach of this duty. We agree.
[34] The designated evidence indicates that Devereux decided to leave the Firm
prior to December 21, 2011, because Conour was failing to pay expenses and
expert witness fees in a timely fashion and the delay was “causing problems”
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with his ability to prepare cases for trial. Appellant’s Br. p. 13. After making
this decision, but prior to ending his employment with the Firm, Devereux
subsequently learned the following: (1) the Firm had not promptly remitted
attorney’s fees to a law firm that had served as co-counsel on a case that had
settled earlier that year; (2) the Firm had not delivered settlement proceeds to a
client from the client’s wrongful death case, in which the settlement proceeds
had been approved for distribution several months earlier; and (3) Conour had
prepared, signed, and faxed a case verification report to Advocate Capital that
contained inaccurate and misleading information relating to certain cases.
[35] In arguing that he did not breach any duty owed to the Loves, Devereux claims
that it would have been inappropriate for him to share his concerns regarding
Conour with the Loves at the time he ended his employment with the Firm.
We agree.
[36] The designated evidence reveals that although Devereux had concerns about
some of Conour’s actions relating to the operation of the firm, at that time,
Devereux’s suspicions related only to what he classified as poor business
practices. Devereux only knew that Conour had failed to pay expert witnesses
and co-counsel in a timely fashion, and had failed to provide an accurate up-to-
date accounting of the Firm’s active cases to Advocate Capital. The designated
evidence further reveals that Devereux did not have access to the Firm’s
financial records, and did not know if there was a reasonable explanation for
the delayed payments of the settlement proceeds which had yet to be
distributed.
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[37] The designated evidence also supports Devereux’s assertions that he did not
have any specific knowledge (1) of any wrongdoing by Conour relating to the
Loves, (2) that Conour was mishandling any active cases, or (3) of any
wrongdoing by Conour other than delaying payments. Review of the
designated evidence reveals that Devereux did not learn that Conour had settled
a client’s claim without the client’s permission or knowledge until February 24,
2012, and did not learn that Conour had settled the Loves’ case without their
permission or knowledge, until July of 2012.
[38] The designated evidence outlining Devereux’s knowledge at the time he
terminated his employment from the Firm is insufficient to create an issue of
material fact with regards to whether Devereux knew, or even should have
known, that Conour would breach the trust instilled in him by his clients by
stealing client funds. Again, whether a particular act or omission amounts to a
breach of an attorney’s duty is generally a question of fact for the jury. In re
Estate of Lee, 954 N.E.2d at 1047 (citing Oxley, 819 N.E.2d at 856). “However,
breach can become a question of law where the facts are undisputed and only a
single inference can be drawn therefrom.” Id. (citing Oxley, 819 N.E.2d at 856).
Devereux claims that the record demonstrates that he acted appropriately and
satisfied his duty to exercise ordinary skill and knowledge in relation to his
representation of the Loves by subsequently initiating contact with the
Disciplinary Commission regarding his concerns about Conour. Our review of
the designated evidence submitted by the parties lead us to conclude that the
designated evidence only allows for a single inference to be drawn, that
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inference being that Devereux did not breach any duty that he owed to the
Loves prior to or at the time he terminated his employment with the firm.
[39] Furthermore, while we observe that William Harrington, an attorney who has
been licensed to practice law in Indiana since 1989, opined that Devereux
violated the duty he owed to the Loves, Harrington’s opinion was formulated
on the unsupported assumption that Devereux had knowledge that Conour
“may have been a thief of money belonging to clients and others.” Appellant’s
App. p. 44. As is stated above, the designated evidence is insufficient to prove
that Devereux “knew” that Conour was potentially stealing money from clients
or others at the time Devereux left the firm. Accordingly, we cannot say that
Harrington’s affidavit created an issue of material fact as to whether Devereux
breached any duty he may have owed to the Loves.
ii. Potential Breach Committed Upon Devereux’s Departure from the Firm
[40] The Loves also argue that Devereux breached his duty by failing to withdraw
his representation in the least harmful manner possible. Specifically, the Loves
claim that Devereux violated his duty to them because he failed to warn the
Loves of Conour’s wrongdoings despite the fact that he did not officially
withdraw as an attorney of record until April of 2012, by which time he knew
or should have known of the expansive scope of Conour’s wrongdoings. We
cannot agree.
[41] The designated evidence reveals that by the time Devereux learned that Conour
had mishandled active cases, Devereux had not served as the Loves’ attorney
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for nearly two months. Importantly, Jim admitted that as of December 29,
2011, he knew that Devereux was no longer his attorney. Jim’s admission
undercuts his and Diana’s claim on appeal that Devereux remained their
attorney or retained some duty to them after he left the firm. As such, in this
regard, we conclude that no issue of material fact remains that would preclude
an award of summary judgment in favor of Devereux.
II. Denial of the Loves’ Motion to Strike Expert
Affidavit Tendered by Devereux
[42] The Loves also contend that the trial court erred in denying their motion to
strike the expert affidavit tendered by Devereux. A trial court has broad
discretion in granting or denying a motion to strike. Auto-Owners Ins. Co. v. Bill
Gaddis Chrysler Dodge, Inc., 973 N.E.2d 1179, 1182 (Ind. Ct. App. 2012) (citing
Coleman v. Charles Court, LLC, 797 N.E.2d 775, 786 (Ind. Ct. App. 2003)). The
trial court’s decision will not be reversed unless prejudicial error is clearly
shown. Id. (citing Coleman, 797 N.E.2d at 786). Further, this court has
previously concluded that expert testimony is generally required to establish the
applicable standard of care in legal malpractice actions. In re Estate of Lee, 954
N.E.2d at 1047. However, experts may not testify as to conclusions of law.
Hacker v. Holland, 570 N.E.2d 951, 953 (Ind. Ct. App. 1991).
[43] In the instant matter, the Loves designated the affidavit of Harrington as expert
testimony in support of their legal malpractice claim. Devereux filed a motion
to strike Harrington’s affidavit. He also designated the affidavit of Lee Christie
on a conditional basis, arguing that Christie’s affidavit should be considered as
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designated evidence if the trial court did not strike Harrington’s affidavit. The
Loves subsequently sought to strike Christie’s affidavit. The trial court denied
both motions to strike, allowing both affidavits to remain part of the designated
evidence.
[44] Christie’s affidavit, like that tendered by Harrington, included statements
relating generally to the duty an attorney owes to his or her clients and opinions
relating specifically as to whether Christie believed that Devereux’s actions
breached that duty. Because Christie’s opinions related to the factual
determination of what constitutes a breach of duty we conclude that his
opinions did not constitute conclusions of law. See In re Estate of Lee, 954
N.E.2d at 1047 (providing that “although experts may not testify as to
conclusions of law, such as the existence of a duty, expert witnesses are
permitted to testify to the standard of practice within a given field”). As such,
we conclude that the trial court did not abuse its discretion in denying the
Loves’ motion to strike Christie’s affidavit.
Conclusion
[45] We conclude that the trial court erred in denying Devereux’s motion for
summary judgment. We also conclude that the trial court did not abuse its
discretion in denying the Loves’ motion to strike Christie’s affidavit.
Accordingly, we reverse the trial court’s denial of Devereux’s motion for
summary judgment, affirm the trial court’s denial of the Loves’ motion to strike
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Christie’s affidavit, and remand to the trial court with instructions to enter
summary judgment in favor of Devereux.
[46] The judgment of the trial court is affirmed in part, reversed in part, and
remanded with instructions.
Robb, J., concurs, Riley, J., concurs in result.
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