Opinion ID: 1793652
Heading Depth: 1
Heading Rank: 9

Heading: what happened here

Text: There are four points in time when special care was required of Coker and Williamson to see that Foster's interest was served. First, when Coker and Williamson were employed it was their responsibility to be sure that Foster was notified he was being sued in excess of his policy limits, clearly signal to him his personal liability danger, and that he should consider employing his own attorney if he cared to do so. Magarick, Excess Liability, (1982), § 15.03. Generally, the insurance company by its first letter to the insured following filing of a suit has already done this. Napper failed to do so for some reason. Coker and Williamson both testified positively that they did inform Foster he was being sued in excess of his policy limits and to consider employing his own attorney, and that he could do so if he chose. Foster did not deny this. In any event we need not tarry here because Foster never made any claim either in his declaration or at trial that Hartford or the attorneys had breached their duty by not informing him to consider consulting with or employing independent counsel. The next juncture was when the plaintiff offered to settle for $45,000. The attorneys' duty then was to inform Foster of the offer, as well as Hartford. It is undisputed that Foster was informed of this offer. Should Foster then have been told that he needed independent counsel? Coker testified he did not advise him because he could not see at that stage that it could have accomplished anything. As a practical matter Coker was probably correct, although it would have been professionally safer for him to have advised Foster at that time to seek it. Coker's failure to so advise Foster is understandable because Foster's answer to Coker when informed of the $45,000 offer was to request that it be accepted, which is all that any attorney he may have consulted could have demanded. The insurance company by contract had control of the defense of the case. Furthermore, it is totally unrealistic to suppose that if Foster had contacted some outside attorney he would have undertaken to enter the defense of the case alongside Coker and Williamson. Had such attorney been consulted, a demand from him that the case be settled within policy limits at the peril of a later suit by Foster for bad faith refusal to settle would have been the best service he could have rendered. Foster secured all those rights for himself when he requested the suit to be settled within policy limits. Indeed there is authority for the proposition that in dangerous cases it is the duty of the insurance carrier to initiate settlement offers on its own. Fulton v. Woodford, 26 Ariz. App. 17, 545 P.2d 979 (1976); Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 323 A.2d 495 (1974). Thomas v. Western World Ins. Co., 343 So.2d 1298 (Fla. 1977); Davis v. Nationwide Mut. Fire Ins. Co., 370 So.2d 1162 (Fla. App. 1979). Therefore, even though it might be abstractly argued that Coker should have told Foster to seek independent advice, there can be no doubt that his failure to do so caused Foster no damage. The final two steps were two subsequent offers to settle, one during trial for either $35,000 or $40,000, and the last offer for $30,000 while the jury was retired to consider its verdict. Coker and Williamson had the positive duty again to specifically inform Foster of these offers just as Coker informed Hartford. Both attorneys testified that Foster was informed of these offers. Foster denied it, and positively denied that he was told of the $30,000 offer. A jury issue was thus presented on liability on the part of the defendants for failure of the attorneys to notify Foster of the $30,000 settlement offer. But there is no jury question on the damage caused by such failure. Why? Because it is clear that if Foster had been told it would have made no difference. Foster never at any time claimed that had he been told of these offers, he would have paid the extra money out of his own pocket to settle. Had he done so, we would have the case of Lysick v. Walcom, supra . In that case the attorney delayed communicating to the plaintiff an expressed willingness of the insured client's estate to contribute the necessary difference between the settlement offer and what the carrier was willing to pay, and also delayed informing the administrator of the insured's estate of the carrier's willingness to pay its policy limits, arguably resulting in no compromise being effected. The California court of appeal held that there was a jury question on whether this delay was a proximate cause of the loss to the insured's estate. In this case not only is there a total absence of any claim or suggestion by Foster that if he had been told of the $30,000 offer, and $25,000 counter-offer by Hartford, that he would have attempted to raise the difference out of his own pocket, the record suggests quite the contrary. Even after trial Foster was unwilling to permit Coker to attempt to negotiate any settlement whereby he might have to pay something. It was incumbent upon Foster not only to show that there was a breach of duty owing him by his attorneys, but that he was damaged thereby. Lysick v. Walcom, supra ; Hickox by and through Hickox v. Holleman, 502 So.2d 626, 633-634 (Miss. 1987); Fulton v. Woodford, supra ; Mallen and Levitt, Legal Malpractice, supra, § 534. He totally failed to show any damage caused by any such breach of duty. [13] There remains but one other area where Coker alone subjected himself to a possible conflict of interest claim, and this was when he suggested to Napper that if the case could be settled for $25,000 to pay it. Here again we must carefully adhere to what the record in this case shows. True, a lawyer cannot serve two masters, but in this instance Coker's recommendation to Napper was not an attempt to help Hartford, but was for the benefit of Foster. His recommendation to Napper was for Hartford to pay something which neither Coker, Williamson nor Napper thought the company either owed or would otherwise have to pay. The only reason Coker made the recommendation was to help Foster. Surely Coker and Williamson cannot be faulted for having confidence in their case. Aside from the facts we have already detailed, let us look for a moment at the parties and trial venue. Foster and Harris were two white residents of Simpson County operating a respectable retail furniture store which had been in business many years. The plaintiff was a non-resident black, illiterate and unemployed, upon whose breath the investigating officer (from his county) said he smelled alcohol just after the accident. Harris's pretrial statements and his testimony revealed no negligence on his part. Williamson, a local attorney with many years trial experience and attorney for the county board of supervisors, testified that if liability coverage had been unlimited he would not have recommended paying anything. Coker likewise testified that if Foster had either had no insurance coverage or unlimited coverage he would not have recommended paying $25,000. Then why did Coker first suggest that Napper consider paying $20,000 to $25,000 in settlement, and conclusion of trial recommend that Hartford pay $25,000? He did it to help Foster, and thereby remove from Foster the possibility, albeit to Coker and Williamson remote, of a verdict in excess of $50,000. Had Coker been more professionally cautious and made no recommendation he may have escaped some of the problem he and Williamson had to face in the subsequent Foster bad faith trial. It is nevertheless clear that in doing so he thought he was helping Foster, and leaning in Foster's favor as against his other client Hartford. Whatever may be said of his professional caution, insofar as Foster personally was concerned, Coker's heart was in the right place. Indeed, at that point in time Napper may have suspected Coker was not acting in Hartford's interest. It is also true that the best of intentions on the part of Coker would not absolve him in any subsequent lawsuit by Foster, if this recommendation harmed Foster in any way. The question is, did it? Here again the record is absolutely clear, it did not. If Coker had not made this recommendation Hartford might not have offered anything to settle the case. Most assuredly Napper would not have authorized as much as $25,000 in a counter-offer, because he testified that when he gave Coker this authority he hoped they didn't take it. Napper obviously wanted for Hartford to takes its chances before the jury. The final question: was Coker under any duty to Foster to recommend more? He was not. He certainly was under no ethical or legal obligation to Foster to ask his other client to pay something he did not honestly and realistically think it owed. In sum there is nothing in this record to show that a breach of duty on the part of either Coker or Williamson harmed Foster in any way. There are many cases where attorneys representing insurance companies and their insureds have been held to account for breach of professional duty. We have cited some: Betts v. Allstate Ins. Co., supra ; Lysick v. Walcom, supra ; Rogers v. Robson, Masters, Ryan Rrumond & Belam, supra; Lieberman v. Employers Ins. of Wausau, supra ; Hamilton v. State Farm Mut. Auto. Ins. Co., supra . This is not such a case. See also, Mallen and Levitt, Legal Malpractice, supra, Ch. 17, § 530-539, and cases cited. It follows that the judgment of the circuit court should be reversed and judgment rendered here for the appellants. This holding dispenses with the cross-appeal of Foster as to his punitive damage and prejudgment interest claim. ON DIRECT APPEAL, JUDGMENT REVERSED AND RENDERED; AFFIRMED ON CROSS-APPEAL. HAWKINS, P.J., ROY NOBLE LEE, C.J., and ANDERSON, GRIFFIN, and ZUCCARO, JJ. concur, joined by DAN M. LEE, P.J., as to liability of Coker and Williamson. PRATHER, J., dissents; joined by DAN M. LEE, P.J., as to liability of Hartford Accident & Insurance in Parts III, VIII, and IX; and joined by ROBERTSON, J., in Parts I, II, III, and VIII. ROBERTSON, J., dissents with separate written opinion. SULLIVAN, J., not participating.