Opinion ID: 2514807
Heading Depth: 2
Heading Rank: 2

Heading: The district court properly granted summary judgment in favor of all Respondents.

Text: The district court granted summary judgment in favor of Lopez on the grounds that J-U-B had failed to demonstrate two essential elements of its claim for legal malpractice: proximate cause and damages. The district court granted summary judgment in favor of Security Insurance, concluding that the handling of the Chapman litigation did not breach the contract or the implied covenant of good faith and fair dealing. This finding was based upon the district court's determination that under the unambiguous terms of the Policy, the right to seek attorney fees and costs from the Chapmans was one that belonged solely to Security Insurance. Because we conclude that the record does not demonstrate that J-U-B suffered damages resulting from the resolution of the Chapman litigation, we affirm.
J-U-B argues that a jury must decide whether it suffered any damages and if so, whether those damages are supported by competent evidence. We disagree. To establish a claim for professional negligence, the plaintiff must show: (1) the existence of an attorney-client relationship; [4] (2) the existence of a duty on the part of the lawyer; (3) the failure to perform that duty; and (4) the failure to perform the duty must be a proximate cause of the injuries suffered by the client. Estate of Becker v. Callahan, 140 Idaho 522, 526, 96 P.3d 623, 627 (2004) (citing McColm-Traska v. Baker, 139 Idaho 948, 951, 88 P.3d 767, 770 (2004); Jordan v. Beeks, 135 Idaho 586, 590, 21 P.3d 908, 912 (2001); Marias v. Marano, 120 Idaho 11, 13, 813 P.2d 350, 352 (1991); Johnson v. Jones, 103 Idaho 702, 652 P.2d 650 (1982)). Summary judgment is appropriate if the plaintiff fails to demonstrate the existence of a genuine issue of material fact as to causation and damages. McPheters v. Maile, 138 Idaho 391, 396, 64 P.3d 317, 322 (2003). Under the terms of its insurance policy with Security Insurance, J-U-B was not entitled to recover attorney fees or costs in the Chapman litigation. The insurance policy included a subrogation clause that transferred J-U-B's right to recover attorney fees and costs to Security Insurance. [5] Any recovery of attorney fees or costs in the Chapman litigation would have inured to the benefit of Security Insurance. Therefore, even if J-U-B had obtained an award of attorney fees and costs against the Chapmans, it would not have been entitled to these funds. Consequently, J-U-B has not shown that it suffered direct damages resulting from Lopez's failure to pursue an award of attorney fees and costs in the Chapman litigation. J-U-B argues that, because the insurance policy was a wasting contract, funds expended in defense of the Chapman litigation reduced available coverage during the period of policy coverage. However, there is nothing in the record demonstrating that the reduced coverage resulted in J-U-B incurring a financial loss during the coverage period. In the absence of evidence that Respondent's decision not to pursue an award of attorney fees and costs against the Chapmans resulted in an actual financial loss, rather than simply a potential for financial loss, we conclude that J-U-B has not demonstrated damage resulting from the wasting provision of the insurance policy. J-U-B also claims that it is entitled to damages because its reputation as an aggressive party to litigation was damaged as a result of the resolution of the Chapman litigation. J-U-B argues that it has constructed a reputation as a pugnacious litigator and that the manner in which the Chapman litigation was resolved damaged that reputation. J-U-B has not directed us to authority for the proposition that a party may claim damages to its reputation arising from legal malpractice. Although we express doubt that such damages may ever be recoverable, we need not reach this question of law because there is simply no admissible evidence in the record before us that J-U-B has sustained damage to its reputation based upon the resolution of the Chapman litigation. Accordingly, the district court did not err by granting summary judgment in favor of Lopez.
As previously noted, the district court granted summary judgment in favor of Security Insurance, concluding that the handling of the Chapman litigation did not breach the contract or the implied covenant of good faith and fair dealing. Although a majority of this Court would affirm on this ground, we are not unanimous. However, because we are unanimous in our agreement that the record does not demonstrate damages resulting from the claimed breach of Security Insurance's contractual duties, we affirm on that basis. Unlike its claim for damages against Lopez, J-U-B has presented authority from other jurisdictions [6] that supports an award of damages to an insured professional's reputation resulting from the breach of a consent-to-settle clause in an insurance contract. However, we need not address whether a plaintiff in this state can recover damages for injury to reputation resulting from breach of such a clause, as there is simply no admissible evidence in the record to support such a claim in this case. J-U-B's claim for damages against Security Insurance advanced the same components of damages as claimed against Lopez. As noted in Part III(B)(1) of this opinion, supra, J-U-B has failed to demonstrate a genuine issue of material fact supporting these claims. Accordingly, we affirm the district court's grant of summary judgment in favor of Security Insurance, albeit on different grounds.