Court Opinion

ID: 2735774
Source: CourtListenerOpinion
Date Created: 2014-09-22 20:07:35.461193+00
Date Added: 2024-06-11T09:47:21.780786
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

SUSAN E. SHOLLY, LORNA L.
STEWART, and LINDA A. MULLINS,
                                                 No. 70434-6-1
                    Appellants,
                                                 DIVISION ONE

CYNTHIA WORTH and JOHN WAY
and WORTH LAW GROUP, P.S.,                       UNPUBLISHED OPINION
INC., a Washington Professional
Services Corporation, d/b/a WORTH                FILED: September 22, 2014
LAW GROUP,

                     Respondents.

       Becker, J. — Three sisters appeal the summary judgment dismissal of

their legal malpractice claim against the attorneys who represented them in a

trust accounting dispute with their stepmother and stepsister. The trial court

granted summary judgment for the attorneys. We affirm.

                                      FACTS

      When James Stewart and Dorothy Dunson married in 1982, Dunson had a

daughter, Barbara Dunson, and Stewart had three daughters: Susan Sholly,

Lorna Stewart, and Linda Mullins. In 1996, Stewart and Dunson entered an

agreement creating the Stewart-Dunson Living Trust, naming themselves as

trustees and primary beneficiaries of the trust, and granting their separate and

community property to the trust. Upon the death of the first grantor to die, the
No. 70434-6-1/2

trust agreement directs the surviving grantor to divide the trust, placing the

separate property of the deceased grantor in a separate credit trust to be used

for the care of the survivor if other funds are insufficient, and to be distributed to

the deceased grantor's children upon the death of the survivor.

       Stewart died on March 5, 2009. Stewart's will named Dunson as his

personal representative and directed the transfer of his separate and community

property to the trust. In April 2009, Dunson named her daughter Barbara as

trustee of the trust.

       Prior to his death, Sholly had assisted her father in managing his finances.

After initially assisting Dunson in gathering financial information for the

management of Stewart's estate and the trust, Sholly became concerned about

Dunson's and Barbara's intentions regarding the management of the credit trust.

In April 2009, Sholly hired Cynthia Worth and John Way of the Worth Law Group

(hereinafter "Worth") to assist her in negotiating with Dunson and her attorney

regarding Stewart's estate and the trust. Sholly provided all the information she

had regarding her father's finances to Worth. In November 2009, after

disagreements arose over items of personal property and the need for an

accounting of the trust's assets, Worth filed a petition under Washington's Trust

and Estate Dispute Resolution Act (TEDRA), seeking an accounting and the

appointment of an independent trustee. In December 2009, Sholly's sisters also

engaged Worth to represent them in the TEDRA proceeding.

       In January 2010, the parties participated in mediation. The parties agreed

to settle on condition that the trust transfer $1.1 million in assets and $25,000 in
No. 70434-6-1/3

cash for attorney fees to the three sisters. With the addition of an IRA (individual

retirement account), a coin collection, certain bank accounts, and various items

of personal property, the sisters received more than $1.3 million as a result of the

settlement. On January 19, 2010, the parties filed a CR 2A settlement

agreement to close the TEDRA proceeding.

       In August 2011, the sisters filed a complaint for legal malpractice against

Worth. The complaint alleges that the attorneys breached their duty of care by

encouraging the sisters to settle the TEDRA action without conducting discovery

to "ascertain the true amount of plaintiffs' rights to the trusts and estate of their

father, James Stewart." As to their claim of injury, the complaint alleges that the

sisters "discovered that their rights to the estate and trust assets left to them by

their father likely exceeded the amount they were advised to settle for by

defendants."

       In February 2013, Worth moved for summary judgment dismissal, arguing

that the sisters could not establish a breach of the standard of care, damage, or

proximate cause. In support of the motion, Worth provided the declaration of

Mark Newton, an expert in forensic accounting and economic evaluations. In his

declaration, Newton listed all documents and financial records he reviewed to

support his independent valuation of Stewart's separate property and half of the

community property at the time of Stewart's death at $1,479,530. Based on his

review of the report prepared by the sisters' financial expert, Neil Beaton, and the

supporting documents in Beaton's file, Newton stated,

       I can find no records that support Mr. Beaton's conclusion that Mr.
       Stewart's separate property and his portion of the community
No. 70434-6-1/4

       property he shared with his wife of 26 years, Dorothy Dunson, was
      worth $2.1 million at the date of his death in March 2009.
       Furthermore, I have been provided thousands of other documents
       related to the estate (identified above) and can find no indication
      that Mr. Stewart's assets were valued at $2.1 million in March 2009.

       In response, the sisters referred to Beaton's report and their own

declarations to demonstrate that they "lost a substantial amount of probable

inheritance by settling without knowing the amount of assets their father

possessed at the time of his death." They claimed that the differences between

Beaton's and Newton's analyses raised a question of fact for trial. In their

declarations, the sisters state that Worth did not advise them that Dunson had

not produced all the financial information regarding the assets in the trust and

Stewart's estate, that they could leave the mediation without settling the case, or

that the mediator did not have the power to force a settlement.

      The trial court granted summary judgment dismissal. The sisters appeal.

                                    ANALYSIS

      We review an order of summary judgment de novo, engaging in the same

inquiry as the trial court. Folsom v. Burger King, 135 Wash. 2d 658, 663, 958 P.2d
301 (1998). Summary judgment is proper if, viewing the facts and reasonable

inferences most favorably to the nonmoving party, no genuine issues of material

fact exist and the moving party is entitled to judgment as a matter of law. CR

56(c): Versuslaw, Inc. v. Stoel Rives. LLP, 127 Wash. App. 309, 319-20, 111 P.3d
866 (2005), review denied, 156 Wash. 2d 1008 (2006). The initial burden is on the

moving party to show that there are no genuine issues of material fact. Pac. Nw.

Shooting Park Ass'n v. City of Seguim. 158 Wash. 2d 342, 350, 144 P.3d 276
No. 70434-6-1/5

(2006). "Once the moving party has met its burden, the burden shifts to the

nonmoving party to present admissible evidence demonstrating the existence of

a genuine issue of material fact." Pacific Nw. Shooting Park. 158 Wash. 2d at 351.

       To establish a case of legal malpractice, the sisters must prove (1) the

existence of an attorney-client relationship which gives rise to a duty of care, (2)

an act or omission by Worth that breaches the duty of care, (3) damage to the

sisters, and (4) proximate causation between Worth's breach of duty and the

damages incurred. Hizev v. Carpenter. 119 Wash. 2d 251, 260-61, 830 P.2d 646

(1992). To avoid dismissal, the sisters must show an issue of material fact as to

each element. Craig v. Wash. Trust Bank. 94 Wash. App. 820, 824, 976 P.2d 126

(1999). Worth contends that the sisters failed to demonstrate a genuine issue of

fact for trial as to damage or proximate cause.

       In the summary judgment motion, Worth argued that the sisters failed to

identify factual support for the $2.1 million figure listed in Beaton's report. Worth

also produced Newton's $1.4 million independent valuation based on specifically

identified financial records. The sisters claim that they responded to Worth's

summary judgment motion with "ample testimony" to demonstrate a question of

fact for trial as to the damage element. But their own declarations do not identify

a single account or asset of which they were not aware until after the settlement

or that they claim was undervalued at the time of the mediation. Despite

repeatedly suggesting in their briefing before this court that they "discovered"

some kind of information after the mediation, the sisters fail to plainly identify any

particular fact unknown to them before the settlement.
No. 70434-6-1/6

       And contrary to the sisters' bald assertion, Beaton's report does not raise

an issue for trial simply because it lists a different valuation than that described

by Worth's expert, Newton. In his report, Beaton admits that he did not audit or

perform an independent evaluation of Stewart's estate or the trust assets, but

simply assumed that the limited materials he reviewed were "substantially true

and correct." "'An opinion of an expert which is simply a conclusion or is based

on an assumption is not evidence which will take a case to the jury.'" Melville v.

State. 115 Wash. 2d 34, 41, 793 P.2d 952 (1990), quoting Theonnes v. Hazen. 37
Wash. App. 644, 648, 681 P.2d 1284 (1984). In their response to the summary

judgment motion, the sisters failed to identify any particular financial records or

other evidence to support the $2.1 million valuation. And they offered nothing to

contradict the specific evidence, including individually numbered account

statements, tax returns, and notes prepared by Sholly, listed by Newton in

support of his $1.4 million valuation. A party opposing summary judgment may

not rely on speculation, argumentative assertions that unresolved factual issues

remain, or consideration of its affidavits or declarations at face value. Seven

Gables Corp. v. MGM/UA Entm't Co.. 106 Wash. 2d 1, 13, 721 P.2d 1 (1986).

Because the sisters did not present specific facts to support a conclusion that

they suffered any damage, an essential element of a malpractice claim, summary

judgment was appropriate.

       Moreover, the sisters fail to identify a genuine issue of material fact for trial

as to proximate cause. To establish proximate cause, the sisters must

demonstrate that "but for" Worth's alleged negligence, they would have obtained
No. 70434-6-1/7

a better result. Smith v. Preston Gates Ellis. LLP, 135 Wash. App. 859, 864, 147
P.3d 600 (2006). review denied, 161 Wash. 2d 1011 (2007). Although proximate

cause in a legal malpractice case is generally a question for the trier of fact,

summary judgment dismissal is proper where the plaintiff fails to identify

sufficient evidence of proximate causation. See, e.g., Griswold v. Kilpatrick. 107
Wash. App. 757, 760-61, 27 P.3d 246 (2001) (summary judgment for attorney

appropriate where former client failed to demonstrate that attorney's delay

resulted in lesser settlement amount).

       Worth offered the declaration of attorney Robin Balsam as an expert in

probate, guardianship, and trust matters in support of the motion for summary

judgment. Balsam opined that the sisters "faced a long and difficult road in the

TEDRA litigation," there "was no guarantee" they would receive an accounting or

the appointment of an independent trustee, and, even if successful, "the cost of

forensic accounting and other experts was likely to be very significant." In his

declaration, Balsam described in detail the factual and informational basis for his

opinion. Cf Griswold, 107 Wash. App. at 761-62 (expert's speculative and

conclusory opinion lacked substantive support in record and therefore did not

create issue of material fact).

       The sisters did not produce any expert opinion to dispute Balsam's opinion

regarding the potential outcome of their TEDRA proceeding or identify any

evidence in the record to support a conclusion that they would have obtained a

better result ifthey had not settled at the mediation in January 2010. It is

undisputed that as the secondary beneficiaries of the trust, the sisters were not
No. 70434-6-1/8

entitled to receive anything from Stewart's estate or the trust until Dunson's death,

which did not occur until January 2013. There is no support in the record for their

bald assertions that they "lost a substantial amount of probable inheritance" by

settling or that their "rights" to their father's assets exceeded what they received

as a result of the mediation. Because the sisters failed to raise a genuine issue

of material fact on the element of proximate "but for" causation, the trial court

properly granted summary judgment to Worth.

       Affirmed.

WE CONCUR:

 l/% okcy rT                                       /e*