FILED
Jun 23 2017, 8:20 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEY FOR APPELLANT ATTORNEY FOR APPELLEE
Jon R. Pactor Timothy F. Devereux
Indianapolis, Indiana Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Rene DiBenedetto, June 23, 2017
Appellant-Plaintiff, Court of Appeals Case No.
49A05-1609-CT-2146
v. Appeal from the Marion Superior
Court
Timothy Devereux, The Honorable James A. Joven,
Appellee-Defendant Judge
Trial Court Cause No.
49D13-1310-CT-37987
Altice, Judge.
Case Summary
[1] This is another legal malpractice action arising from the theft and deceit
committed by former attorney William F. Conour (Conour) that led to the
downfall of Conour Law Firm (the Firm) and victimized many of the Firm’s
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clients.1 Rene DiBenedetto is one such client. In this case, DiBenedetto filed a
legal malpractice complaint against Timothy Devereux, an attorney who once
practiced law with the Firm. DiBenedetto maintains that Devereux committed
legal malpractice when he failed to accurately and honestly advise her regarding
distribution of her settlement funds. Devereux filed a motion for summary
judgment2 challenging the merits of DiBenedetto’s legal malpractice claim.
After a hearing, the trial court granted Devereux’s summary judgment motion.
DiBenedetto now appeals, arguing that genuine issues of material fact preclude
entry of summary judgment in favor of Devereux.
[2] We affirm.
Facts & Procedural History
[3] DiBenedetto was severely injured in a head-on collision on April 21, 2010. On
April 26, 2010, DiBenedetto entered into a contingent-fee contract with the
Firm. DiBenedetto had a personal connection to Conour and it was Conour
1
For nearly thirteen years, Conour “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.” Devereux v. Love, 30 N.E.3d 754, 757 (Ind. Ct. App. 2015) (record citation
omitted), trans. denied (hereinafter, Love). Part of Conour’s scheme was that he would receive settlement
funds on behalf of some clients and then unlawfully convert such settlement funds to his own use and benefit
or to make settlement payments to other clients. It was determined that Conour stole, misappropriated, and
unlawfully converted to his own use more than $4,500,000 belonging to more than 25 clients. On July 15,
2013, Conour pled guilty in federal court to one count of wire fraud. He was subsequently sentenced to 120
months in prison and ordered to pay restitution to the client-victims. Id.
2
This is the second appeal in this case. In the first appeal, this court addressed the limitations clause in the
attorney-client contract, ultimately affirming the denial of Devereux’s first motion for summary judgment.
See Devereux v. DiBenedetto, 45 N.E.3d 842 (Ind. Ct. App. 2015).
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who agreed to handle her case. Devereux was an associate attorney 3 with the
Firm when DiBenedetto entered into the contract, but he was not assigned to
assist with her case, nor did he perform any work related thereto.
[4] In July 2010, DiBenedetto received a letter informing her that the Firm was
being transitioned to the new law firm of Conour Devereux Hammond. This
letter, which is signed by Conour, Devereux, and Jeffrey Hammond, included
the following statements:
We are pleased to introduce you to the new law firm of Conour
Devereux Hammond which is taking over the cases and business
of the 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.
Appellant’s Appendix, Vol. 2 at 23.4 In closing, the letter stated, “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.” Id.
Despite the name change, Devereux maintains that he did not have an
ownership interest in the Firm, was never a signatory on the Firm’s bank
accounts, and was not provided access to the Firm’s financial records.
3
Under the terms of his Associate Attorney Agreement, Devereux agreed to “always exercise his best
professional judgment on behalf of all clients” and to “comply with all applicable laws, rules, regulations and
the Rules of Professional Conduct in the performance of his duties.” Appellant’s Appendix Vol. 2 at 74.
4
These excerpts are taken from the letter that was sent to James Love. DiBenedetto maintains that she
received the same letter.
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[5] Ultimately, DiBenedetto’s accident claims were settled without the filing of a
lawsuit.5 The first settlement for $50,000 was paid by the insurance company
for the tortfeasor. DiBenedetto signed a Release in Full of All Claims and
Rights on January 13, 2011, but reserved the right to maintain a claim for
underinsured motorist (UIM) coverage against her own insurance company.
[6] During the summer of 2011, DiBenedetto, along with her father, stopped by the
Firm unannounced to inquire about the disbursement of the January settlement.
Conour was not in the office, but Devereux, being the only attorney present
that day, agreed to speak with her. After consulting with the Firm’s paralegal
and reviewing the Firm’s case-management software, Devereux met with
DiBenedetto regarding the status of her case. Specifically, he acknowledged the
January settlement and noted that there were medical liens6 and a pending UIM
claim. Devereux explained that “typically . . . with cases like this” the pending
UIM claim “had to be settled” before the medical liens could be negotiated and
that thereafter, the remaining settlement funds, if any, would be distributed to
her. Id. at 101. He further advised DiBenedetto to follow up with Conour
concerning distribution of the settlement already received.
5
Pursuant to the contract with the Firm, if the matter was resolved prior to the filing of a complaint, the
attorney fees were to be twenty-five percent of the gross recovery obtained.
6
A Value Code Report dated June 15, 2011 itemizes medical expenses received by the Firm for services
provided to DiBenedetto as a result of the accident. As of that date, DiBenedetto’s medical expenses totaled
$34,857.12.
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[7] DiBenedetto’s UIM claim was settled in September 2011, and the settlement
check was dated October 11, 2011. The check was endorsed by someone other
than DiBenedetto7 and deposited into the Firm’s account on October 12, 2011.
It was not until six weeks later, on November 29, 2011, that DiBenedetto was
presented with and signed a release of all claims to finalize the settlement of the
UIM claim. It is undisputed that Devereux did not participate or assist in the
settlement of this claim or that he had any knowledge thereof.
[8] In December 2011, Devereux became concerned about Conour’s business
practices.8 As a result, he resigned from the Firm on December 22, 2011.
DiBenedetto never received any funds from the settlement of either of her
claims. It was later determined that Conour had misappropriated
DiBenedetto’s settlement funds received from both the tortfeasor settlement and
the UIM settlement.
[9] On December 27, 2011, Devereux contacted the Indiana Supreme Court
Disciplinary Commission to express his concerns about Conour. In January
2012, the Federal Bureau of Investigation (FBI) contacted Devereux concerning
an investigation regarding Conour’s failure to fund trusts that he described to
clients as structured annuities. Devereux was not made aware of any other
7
Devereux maintains that he did not endorse the settlement check by signing DiBenedetto’s name.
8
In December 2011, Devereux became aware that Conour had not promptly remitted attorney fees to a law
firm that had served as co-counsel on a case and that he had not yet forwarded settlement proceeds to a client
in a wrongful death action after disbursement had been approved by the probate court. Devereux also
became aware of inaccurate statements Conour made in a report to a financing company used by the Firm.
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potential wrongdoing on behalf of Conour. Conour was criminally charged in
federal court on April 27, 2012, and later pled guilty to one count of wire fraud.
[10] On October 11, 2013, DiBenedetto filed a complaint against Devereux for legal
malpractice, alleging that Devereux was negligent, breached his fiduciary
duties, and breached his contractual obligations by not providing her with
accurate information when she inquired about disbursement of her settlement
funds during the summer of 2011. On March 23, 2016, Devereux filed the
instant motion for summary judgment, arguing that, as a matter of law he did
not breach any duty he owed to DiBenedetto. The trial court held a hearing on
July 11, 2016. On September 2, 2016, the trial court entered an order granting
summary judgment in favor of Devereux. The trial court made no findings of
fact and did not set forth the basis for its decision. DiBenedetto now appeals.
Additional facts will be provided as necessary.
Discussion & Decision
[11] DiBenedetto argues that the trial court erred in granting summary judgment in
favor of Devereux. We review an order granting summary judgment de novo.
Adams v. ArvinMeritor, Inc., 48 N.E.3d 1, 9 (Ind. Ct. App. 2015). Summary
judgment is appropriate if, after reviewing the designated evidence, “there is no
genuine issue as to any material fact and . . . the moving party is entitled to a
judgment as a matter of law.” Ind. Trial Rule 56(C). A fact is material if its
resolution would affect the outcome of the case, and an issue is genuine if a trier
of fact is required to resolve the parties’ differing accounts of the truth, or if the
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undisputed material facts support conflicting reasonable inferences. Williams v.
Tharp, 914 N.E.2d 756, 761 (Ind. 2009). When the trial court has granted
summary judgment, the nonmoving party has the burden on appeal of
persuading us that the grant of summary judgment was in error. Adams, 48
N.E.3d at 9.
[12] “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 v.
Miller, 869 N.E.2d 534, 541 (Ind. Ct. App. 2007) (quoting Clary v. Lite Machines
Corp., 850 N.E.2d 423, 430 (Ind. Ct. App. 2006)), trans. denied. “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.
[13] “Adequate communication and integrity when dealing with clients is a vital
component of any attorney-client relationship.” Matter of Levy, 726 N.E.2d
1257, 1259 (Ind. 2000). It therefore goes without saying that Devereux owed
DiBenedetto a duty to provide her with truthful, accurate, and non-misleading
information when he met with her during the summer of 2011. See Ind.
Professional Conduct Rule 1.4(a)(2) (requiring attorneys to “reasonably consult
with the client about the means by which the client’s objectives are to be
accomplished”); Prof. Cond. R. 1.4(b) (noting that attorneys are to “explain a
matter to the extent reasonably necessary to permit the client to make informed
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decisions regarding the representation”). We conclude as a matter of law,
however, that given the circumstances, Devereux did not breach this duty.
[14] 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.
[15] DiBenedetto argues that Devereux breached his duty to provide her with
truthful and accurate information. She asserts:
[Devereux] never corrected or supplemented the advice that he
gave. For example, he knew that Conour had not “promptly”
distributed any of the money from the first settlement and had
not “promptly” notified any health care provider or subrogee of
the settlement. He knew or should have known that there was no
legal obligation for her to wait for the completion of the
underinsurance claim before money could be distributed. He
knew that nothing had been distributed from either settlement
when he left the firm in December 2011. Even at that time, he
said nothing to her about problems with the handling of her
money.
Appellant’s Brief at 23-24. DiBenedetto designated an affidavit of an attorney,
who opined that Devereux “inaccurately represented that there was no reason
for concern” when DiBenedetto inquired as to why her settlement had not been
distributed six months after she settled the claim with the tortfeasor’s insurance
company. Appellant’s Appendix, Vol. 3 at 123. In the attorney’s opinion,
Devereux should have taken some actions to protect DiBenedetto by
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investigating further and advising her that she may not want to wait for
distribution of the settlement that had already been received.
[16] Devereux argues that he provided DiBenedetto with accurate information and
further advised DiBenedetto to consult with Conour directly regarding the
disbursement of her settlement. He also asserts that the crux of DiBenedetto’s
claim is that he “knew or should have known that CONOUR was mishandling
[her] settlement proceeds” and should have so informed her when he met with
her during the summer of 2011. Appellee’s Appendix at 21. Devereux directs us
to Love and argues that the same result obtains.
[17] The underlying claim in Love arose out of the same type of deceit and
wrongdoing by Conour that precipitated the instant action. In August 2008,
shortly after Devereux joined the Firm, the Loves hired the Firm to represent
them in a personal-injury action. Devereux was subsequently assigned, by
Conour, to work on the Loves’ case and he was also identified as an attorney of
record to the court. When Devereux terminated his employment with the Firm
in December 2011, he informed the Loves generally of his departure and the
Loves signed a form indicating their desire that Conour and the Firm continue
to represent them.
[18] After the Loves discovered Conour’s misconduct, they filed a complaint against
Devereux for legal malpractice, alleging that he failed to warn them of Conour’s
potential wrongdoing. The trial court denied Devereux’s motion for summary
judgment and Devereux appealed. In considering whether Devereux breached
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his duty to exercise ordinary skill and knowledge in relation to his
representation of the Loves, this court was careful not to consider the matter
“through the lens of hindsight,” but rather focused on what Devereux knew at
the time he was alleged to have committed malpractice by failing to warn the
Loves of Conour’s potential wrongdoing. Love, 30 N.E.3d at 764.
[19] The designated evidence revealed to the court that while Devereux had
concerns about Conour’s actions relating to operation of the Firm, such
suspicions related only to poor business practices. The court further noted that
the designated evidence also supported Devereux’s assertion that he did not
have any specific knowledge of wrongdoing by Conour relating to the Loves,
the mishandling of any active cases, or any wrongdoing other than delaying
payments. This court concluded:
[t]he 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.
Love, 30 N.E.3d at 765. Thus, this court held that Devereux’s decision to not
discuss his concerns with the Loves did not amount to a breach of duty to warn
the Loves of Conour’s potential wrongdoing. This court therefore reversed the
trial court’s determination and remanded with instructions that the trial court
enter summary judgment in favor of Devereux.
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[20] Like the Loves, DiBenedetto was also victimized by Conour and is seeking
redress from Devereux. Devereux asserts that despite the factual differences
between the Loves’ scenario and the instant action, this court’s analysis in Love
as to whether he breached a duty owed to DiBenedetto is applicable. He
maintains that his designated evidence, which is virtually identical to the
evidence relating to his knowledge that was designated in Love, shows that he
was not aware of Conour’s wrongdoing at the time he consulted with
DiBenedetto about the distribution of her settlement proceeds. Devereux
further emphasizes that he was never assigned to work on DiBenedetto’s case,
that he did not perform any work on DiBenedetto’s case, and that he spoke
with her on only one occasion when he explained to her the status of her case as
outlined in the Firm’s case management system. Based on these facts,
Devereux asserts that he did not breach any duty owed to DiBenedetto and
thus, the trial court properly granted summary judgment in his favor.
[21] DiBenedetto points to factual differences in arguing that Love is inapposite to
this case. Specifically, DiBenedetto notes that Conour settled the Loves’ claim
without their permission and stole their money months after Devereux left the
firm while both of her claims were settled with her knowledge and prior to
Devereux’s departure. DiBenedetto asserts that “the most critical distinction”
is that, unlike the Loves, she “sought information directly from [Devereux]
about why her settlement in January 2011 had not been distributed.”
Appellant’s Brief at 18.
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[22] Our analysis focuses on the meeting between DiBenedetto and Devereux
during the summer of 2011. DiBenedetto stopped by the Firm unannounced.
It just so happened that Conour was not in the office that day, but Devereux
was. Even though Devereux knew nothing about DiBenedetto’s case, he took a
few minutes to confer with the Firm’s paralegal and review the Firm’s case
management summary with respect to her case. Devereux then met with
DiBenedetto and informed her about the status of her case—confirming the
settlement of the tortfeasor claim and also noting that there were several
outstanding medical bills/liens and a pending UIM claim. There is no dispute
that the information Devereux provided was accurate.
[23] To the extent Devereux advised that the UIM claim “had to be settled” before
the money would be distributed, we conclude that such does not support a
determination that Devereux breached his duty to provide DiBenedetto with
accurate information or breached his duty to exercise ordinary skill and
knowledge. Appellant’s Appendix Vol. 2 at 101. Devereux acknowledges that he
told DiBenedetto that “typically” in cases such as hers, all claims “had to be
settled” before the medical liens would be negotiated and that only thereafter
would the remaining settlement funds, if any, be disbursed to her. In support of
his position, Devereux designated evidence in the form of an attorney affidavit
that “[i]t is common practice that medical bills or liens are frequently not
resolved with the payment of limits by the underlying tortfeasor’s carrier,
particularly if the bills or liens are a significant portion of the underlying
tortfeasor’s settlement.” Appellant’s Appendix Vol. 3 at 99. Given that at the time
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Devereux had no reason to suspect any wrongdoing by Conour with regard to
DiBenedetto’s settlement funds, his advice in this regard was not inaccurate or
necessarily misleading.
[24] DiBenedetto’s designated evidence does not contradict Devereux’s designated
evidence to the effect that it is common practice to wait until all claims are
settled before a settlement is disbursed. DiBenedetto’s expert simply opines that
Devereux “knew or should have known,” Id. at 121, that something was amiss
because Conour had not “promptly” disbursed the settlement funds to cover
medical liens and paid the balance to DiBenedetto pursuant to Prof. Cond. R.
1.15(d).9 DiBenedetto’s expert opines that Devereux breached his duty by
failing to advise DiBenedetto that there was sufficient money to pay her health
care providers and resolve any liens and as a result, the money in the trust
account “should have delivered promptly.” Appellant’s Appendix Vol. 2 at 121.
In reaching this opinion, however, the expert had to make certain assumptions,
such as, that the Firm’s records were complete, that all medical bills had been
received, and/or that the UIM claim would be settled prior to the filing of a
complaint. Devereux’s duty was to provide DiBenedetto with accurate
9
Prof. Cond. R. 1.15(d) provides:
Upon receiving funds or other property in which the client or third person has an interest, a
lawyer shall promptly notify the client or third person. Except as stated in this rule or otherwise
permitted by law or by agreement with the client, a lawyer shall promptly deliver to the client or
third person any funds or other property that the client or third person is entitled to receive and,
upon request by the client or third person, shall promptly render a full accounting regarding such
property.
(Emphasis supplied).
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information and he did just that. To the extent the information Devereux
provided DiBenedetto did not satisfactorily answer her question regarding the
distribution of the first settlement proceeds, Devereux advised her to speak
directly with Conour, who had been responsible for the case since the
beginning.
[25] DiBenedetto’s argument that Devereux knew or should have known that
something was amiss when he reviewed her case file is based on a view of the
facts as they existed at the time of her meeting with Devereux through the lens
of hindsight. Now armed with the knowledge that Conour misappropriated her
settlements, she seeks to reach back in time and blame Devereux for not
knowing that her settlement funds had not been properly safeguarded. At that
time, Devereux had gathered basic information about DiBenedetto’s case as
reflected in the Firm’s records and provided that information to her.
[26] With regard to Devereux’s explanation to DiBenedetto that she would have to
wait until her UIM claim was settled, such was consistent with what Devereux
considered common practice and as such, the fact that the settlement had yet to
be distributed did not raise any red flags. We further note that to the extent
there were questions beyond the overview of information about DiBenedetto’s
case contained in the Firm’s records, Devereux advised DiBenedetto to speak
directly with Conour as he was the only one who had worked on her case and
knew the details thereof. Under the facts of this case, we conclude as a matter
of law that Devereux did not breach his duty to exercise ordinary skill and
knowledge or to provide DiBenedetto with accurate and non-misleading
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information. Having concluded that the designated evidence establishes that
Devereux did not breach any duty owed to DiBenedetto, we affirm the trial
court’s grant of summary judgment in favor Devereux.
Attorney Fees
[27] Devereux requests an award of attorney fees and other sanctions pursuant to
Ind. Appellate Rule 66, which provides:
G. Damages for Frivolous or Bad Faith Filings. The Court
may assess damages if an appeal, petition, or motion, or
response, is frivolous or in bad faith. Damages shall be in the
Court’s discretion and may include attorneys’ fees. The Court
shall remand the case for execution.
[28] Devereux asserts that the dispositive issue – his knowledge of Conour’s
wrongdoing – was previously decided by this court in Love and notes that no
new evidence was presented in this case that would have any effect on that
holding. Devereux further asserts that DiBenedetto even resorted to scandalous
accusations by alleging in her complaint that he “effectively and knowingly
assisted . . . Conour to violate the Rules of Professional Conduct.” Appellant’s
Appendix, Vol. II at 17. Devereux maintains that attorney fees are warranted
given that DiBenedetto persisted in asserting a baseless position, forcing him to
once again defend himself against an issue already decided in Love.
[29] As the above discussion illustrates, the Love decision was not entirely dispositive
of the issue in this case in light of the different factual circumstances. We
therefore do not find that the appeal was frivolous or brought in bad faith.
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Moreover, we conclude that the challenged averment is not so scandalous that
it supports an award of attorney fees. Devereux’s request is denied.
[30] Judgment affirmed.
[31] Riley, J., concurs.
[32] Crone, J., dissents with opinion.
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IN THE
COURT OF APPEALS OF INDIANA
Rene DiBenedetto, Court of Appeals Case No.
49A05-1609-CT-2146
Appellant-Plaintiff,
v.
Timothy Devereux,
Appellee-Defendant
Crone, Judge, dissenting.
[33] I respectfully dissent from the majority’s affirmance of summary judgment in
Devereux’s favor. The majority assumes, without deciding, that an attorney-
client relationship existed between Devereux and DiBenedetto, who had dealt
solely with Conour until the summer of 2011. I agree with this assumption, but
it is important to note that “[c]reation of an attorney-client relationship is not
dependent upon the formal signing of an employment agreement or upon the
payment of attorney fees. An attorney-client relationship need not be express,
but may be implied by the conduct of the parties.” Matter of Anonymous, 655
N.E.2d 67, 70 (Ind. 1995). “Attorney-client relationships have been implied
where a person seeks advice or assistance from an attorney, where the advice
sought pertains to matters within the attorney’s professional competence, and
where the attorney gives the desired advice or assistance.” Id.
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[34] The designated evidence most favorable to DiBenedetto as the nonmoving
party establishes that in July 2010, Devereux, Conour, and Hammond signed a
letter to DiBenedetto on the Firm’s letterhead that stated, “[W]e are continuing
to represent you as your attorneys[,]” and, “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.” Appellant’s App. Vol. 2
at 65. According to DiBenedetto’s affidavit, sometime after she received that
letter, Conour told her “that all of the attorneys would be working on [her]
case.” Appellant’s App. Vol. 3 at 29 (emphasis added). When DiBenedetto
visited the Firm in the summer of 2011 to ask about “the settlement of [her]
case” and “when [she] would be receiving payments[,]” Devereux “did not tell
[her] that he was only an employee or that [she] could not rely on him.” Id. at
30, 29. In response to DiBenedetto’s inquiry, Devereux told her that she
“would not be receiving money until the liens had been taken care of.” Id. at
30. At the very least, this evidence is sufficient to create a genuine issue of
material fact as to whether an attorney-client relationship existed between
Devereux and DiBenedetto.
[35] As DiBenedetto’s attorney, Devereux owed her a general duty to exercise
ordinary skill and knowledge. In re Estate of Lee, 954 N.E.2d 1042, 1047 (Ind.
Ct. App. 2011), trans. denied (2012). And, as the majority acknowledges, it
“goes without saying” that he owed her “a duty to provide her with truthful,
accurate, and non-misleading information when he met with her during the
summer of 2011.” Slip op. at 7 (citing Ind. Professional Conduct Rules
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1.4(a)(2) and 1.4(b)). The majority concludes as a matter of law that Devereux
did not breach this duty. I respectfully disagree.
[36] In support of her response to Devereux’s summary judgment motion,
DiBenedetto submitted the affidavit of an experienced practicing attorney who
opined that Devereux breached the applicable standard of care, based in part on
his belief that Devereux knew or should have known that Conour had not
complied with Professional Conduct Rule 1.15(d) and that Devereux should
have advised DiBenedetto accordingly. Rule 1.15(d) states,
Upon receiving funds or other property in which the client or
third person has an interest, a lawyer shall promptly notify the
client or third person. Except as stated in this rule or otherwise
permitted by law or by agreement with the client, a lawyer shall
promptly deliver to the client or third person any funds or other
property that the client or third person is entitled to receive and,
upon request by the client or third person, shall promptly render
a full accounting regarding such property.
(Emphasis added.)
[37] During his meeting with DiBenedetto, Devereux became aware that the
$50,000 settlement check from the tortfeasor had been deposited in Conour’s
trust account at least five months earlier and that DiBenedetto’s bills for
medical services (the last of which had been rendered at least six months earlier)
totaled less than $35,000. Thus, Devereux also became aware that Conour had
not promptly delivered to DiBenedetto any funds that she was entitled to
receive. See Matter of Helmer, 634 N.E.2d 56, 56 (Ind. 1994) (finding that
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attorney violated Ind. Professional Conduct Rule 1.15 by waiting three months
to deliver client’s portion of settlement funds). In his deposition, Devereux
testified that he told DiBenedetto and her father that “they would have to ask
Mr. Conour” about “when they would be getting payments” and “explained
typically what happened with cases like this if there were medical liens, both
cases had to be settled, the underlying lawsuit and the UIM claim, and then the
medical bill liens had to be resolved” and that “generally, that’s how the system
works.” Appellant’s App. Vol. 2 at 101. Another experienced practicing
attorney who submitted an affidavit in support of Devereux’s summary
judgment motion took a similar position. Appellant’s App. Vol. 3 at 99.
Simply because attorneys “generally” handle certain cases in a certain way does
not mean that the procedure always complies with the Professional Conduct
Rules adopted by our state’s highest court.
[38] At oral argument, Devereux conceded that a minimum of $10,000 of the
$50,000 settlement was unencumbered by any potential medical liens or
attorney fees, that there was no legal impediment to distributing that amount to
DiBenedetto at that time, and that he did not advise her that she had a present
right to receive those funds. See Oral Arg. at 22:29-24:21.10 Had he done so,
DiBenedetto could have asked for and received the funds from Conour, or she
might have been put on notice that something sinister was afoot and terminated
10
Devereux also conceded that any subsequent reduction of the medical bills via negotiations with health
care providers could only have resulted in a larger recovery for DiBenedetto. See Oral Arg. at 23:03-23:15.
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her relationship with Conour. It is important to remember that her funds were
still in Conour’s trust account at that time.
[39] Personal injury plaintiffs are often strapped for cash and hounded by creditors
while they wait for their cases to be resolved. They are also often unfamiliar
with the ins and outs of negotiations and settlements and the professional
responsibilities of the attorneys who are legally and ethically obligated to
protect their interests. Consequently, it is imperative for attorneys to comply
with Professional Conduct Rule 1.15(d) and either promptly distribute funds to
which their clients are indisputably entitled or, at a minimum, advise them of
their right to receive those funds. Based on the evidence most favorable to
DiBenedetto as the nonmoving party, I believe that genuine issues of material
fact exist regarding whether Devereux breached his duty to provide
DiBenedetto with truthful, accurate, and non-misleading information regarding
Conour’s handling of the tortfeasor’s settlement funds and her present right to
receive those funds, as well as whether any breach proximately caused her
alleged damages relating to those funds.11 Therefore, I would reverse the trial
court’s grant of summary judgment in Devereux’s favor, remand for trial, and
deny Devereux’s request for attorney fees.
11
Because there is no evidence that Devereux had any further involvement with DiBenedetto or had any
knowledge of Conour’s subsequent settlement of her UIM claim, I do not believe that he may be considered a
proximate cause of her failure to receive those funds.
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