Opinion
No. CV 07-5009328 S
July 1, 2011
MEMORANDUM OF DECISION
FACTS
On July 11, 2007, the plaintiff, Sally Ogden, filed a complaint in which she alleged a claim of legal malpractice against the defendant, Diserio, Martin, O'Connor Castiglioni, LLP. This action arises out of the legal services rendered by one of the defendant's partners, Brian O'Connor, to the plaintiff during the plaintiff's association with a jewelry store in Greenwich, Connecticut, known as Bolin Company, LLC (Bolin).
The plaintiff also alleged a cause of action for breach of contract against the defendant. On March 31, 2008, the court granted the defendant's motion to strike this breach of contract claim (Radcliffe, J.). On May 5, 2008, judgment was entered in favor of the defendant on the breach of contract claim (Gilardi, J.).
The plaintiff alleges the following relevant facts. The plaintiff loaned approximately $447,424.00 to Bolin. To secure these loans, she was given a promissory note and a security agreement from Bolin. The plaintiff sought the legal services of the defendant in connection with these loans beginning on March 30, 2004. On July 28, 2004, after developments at Bolin made the plaintiff concerned that she would not be repaid the money she had loaned them, O'Connor advised her "that she was legally entitled to seize immediately enough jewelry at the Bolin store to secure her loans to the company," and later, by telephone to the plaintiff's husband, he "confirmed his advice to seize the jewelry . . ." The complaint further alleges that O'Connor failed to "explain the risks of seizure or the advantages of proceeding through established court procedures" and that "O'Connor failed to advise the plaintiff of her [Uniform Commercial Code] UCC responsibilities . . . and the proper way to carry out these legally-required responsibilities." In reliance on O'Connor's advice, she seized jewelry belonging to Bolin between July 28, 2004 and July 30, 2004. When Bolin filed for bankruptcy on August 20, 2004, the plaintiff was required to return the seized items to the bankruptcy trustee, and she subsequently filed a proof of claim in the bankruptcy case seeking repayment of the loan. The bankruptcy trustee objected to the plaintiff's claim and asserted numerous counterclaims against the plaintiff related to the seizure of the Bolin property.
On May 6, 2011, the defendant filed the present motion for summary judgment and a memorandum in support thereof. In support of its motion, the defendant also filed portions of deposition transcripts of the plaintiff and O'Connor, and copies of the promissory note, the security agreement, a District Court decision of Judge Stefan Underhill following a bench trial in a case brought by the bankruptcy trustee on April 30, 2007, against the plaintiff in which Judge Underhill found, inter alia, Ogden liable for tortious inference with business relations, a letter sent from O'Connor to Bolin, and the bankruptcy trustee's counterclaims against the plaintiff in the District Court action. On May 31, 2011, the plaintiff filed an objection to the defendant's motion for summary judgment, a memorandum in support of her objection and a copy of the civil docket list for the District Court action. On June 3, 2011, the defendant filed a reply memorandum. The court heard oral argument on June 7, 2011.
The defendant simultaneously filed a motion for permission to file its motion for summary judgment in light of the pending trial date, which this court granted on May 16, 2011.
The plaintiff does not object to the defendant's proffer of evidence. The court will therefore consider all of the defendant's exhibits in full. Even if some of the evidence might be unauthenticated, a court has the discretion to consider such evidence when no objection has been raised by the opposing party. New London County Mutual Ins. Co. v. Nantes, Superior Court, judicial district of Ansonia-Milford at Derby, Docket No. CV 08 5006397 (April 15, 2010, Bellis, J.) ( 49 Conn. L. Rptr. 864, 865 n. 3), citing Barlow v. Palmer, 96 Conn.App. 88, 92, 898 A.2d 835 (2006).
DISCUSSION
"Summary judgment is a method of resolving litigation when pleadings, affidavits, and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law . . . The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried. (Citations omitted.) Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989). "Summary judgment is an appropriate method for resolving issues of . . . collateral estoppel." Zanoni v. Lynch, 79 Conn.App. 325, 338, 830 A.2d 314, cert. denied, 266 Conn. 928, 837 A.2d 803 (2003).
"In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact. The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to judgment as a matter of law. The courts hold the movant to a strict standard. To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact . . . When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue . . . It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17-45]." (Internal quotation marks omitted.) Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 10-11, 938 A.2d 576 (2008).
In support of its motion for summary judgment, the defendant argues that the district court decision precludes the plaintiff from proving essential elements of her legal malpractice claim. Specifically, the defendant asserts that the plaintiff is collaterally estopped from proving a wrongful act or omission, a necessary element of a legal malpractice claim, because the district court: (1) decided that O'Connor did not advise the plaintiff that she could immediately repossess the jewelry on July 28, 2004, and (2) concluded, as a matter of law, that the plaintiff was entitled to seize the jewelry and other property under the security agreement based on Bolin's default. Alternatively, the defendant argues that the plaintiff's legal malpractice claim fails because, even if O'Connor gave the plaintiff the advice she claims, such advice was legally accurate under the security agreement. The defendant argues that legally accurate advice cannot be the basis of a legal malpractice claim.
The plaintiff, in response, argues that the district court decision does not preclude her claim for several reasons. First, she argues that the district court decision was not final because she has filed a motion to amend/correct that decision. Second, she argues that the issues in the present case were neither necessarily nor actually decided in that decision. In its reply brief the defendant responds that the district court decision was final for purposes of collateral estoppel and reiterates its argument that the issues in the present case were decided and were necessary to the district court decision on the tortious interference claim.
In her objection, the plaintiff argues that "res judicata" does not apply here. She does not specifically address the applicability of "collateral estoppel" as asserted by the defendant. "Claim preclusion (res judicata) and issue preclusion (collateral estoppel) have been described as related ideas on a continuum. [C]laim preclusion prevents a litigant from reasserting a claim that has already been decided on the merits . . . [I]ssue preclusion . . . prevents a party from relitigating an issue that has been determined in a prior suit . . . Both doctrines protect the finality of judicial determinations, conserve the time of the court, and prevent wasteful relitigation . . . and express no more than the fundamental principle that once a matter has been fully and fairly litigated, and finally decided, it comes to rest . . .
"Res judicata, or claim preclusion, is [however] distinguishable from collateral estoppel, or issue preclusion. Under the doctrine of res judicata, a final judgment, when rendered on the merits, is an absolute bar to a subsequent action . . . between the same parties or those in privity with them, upon the same claim . . . In contrast, collateral estoppel precludes a party from relitigating issues and facts actually and necessarily determined in an earlier proceeding between the same parties or those in privity with them upon a different claim." (Internal quotation marks omitted.) 12 Havemeyer Place Co., LLC v. Gordon, 93 Conn.App. 140, 152, 888 A.2d 141 (2006).
Before determining whether collateral estoppel applies, the court must deal with the plaintiff's claim that no final appealable judgment on the merits exists with respect to the district court decision, and that, therefore, collateral estoppel does not apply. While res judicata requires a final judgment on the merits, see New England Estates, LLC v. Branford, 294 Conn. 817, 842, 988 A.2d 229 (2010), collateral estoppel requires the full and fair litigation of an issue in a prior action, but does not require a final judgment on the merits, see, e.g., Ventres v. Goodspeed Airport, LLC, 301 Conn. 194, 205 (2011); Gateway, Kelso Co. v. West Hartford No. 1, LLC, 126 Conn.App. 578, 583-84, 15 A.3d 635, cert. denied, 300 Conn. 929, 16 A.3d 703 (2011); Gadbois v. Planning Commission, Superior Court, judicial district of New London, Docket No. CV 559758 (November 13, 2001, Purtill, J.T.R.) ( 30 Conn. L. Rptr. 680, 682) ("the existence of a final judgment on the merits is an element of res judicata, not collateral estoppel"). Thus, there is no requirement that the district court decision be a final decision, as argued by the plaintiff.
The elements of a claim for legal malpractice are (1) the existence of an attorney-client relationship; (2) the attorney's wrongful act or omission; (3) causation; and (4) damages. Gray v. Weinstein, 110 Conn.App. 763, 773, 955 A.2d 1246 (2008). The defendant argues that the plaintiff cannot establish the second requirement for a legal malpractice claim as the district court decision precludes a finding that O'Connor committed a wrongful act or omission. The court must therefore determine whether collateral estoppel precludes the plaintiff's legal malpractice claim.
The defendant, in its motion for summary judgment, does not raise the issue that the plaintiff's failure to present expert testimony prohibits her from establishing a prima facie legal malpractice claim. "As a general rule, expert testimony is a prerequisite to the successful prosecution of a claim of legal malpractice." Law Offices of Robert K. Walsh, LLC v. Natarajan, 124 Conn.App. 860, 861, 7 A.3d 391 (2010). "[T]he rationale underlying [the requirement of expert testimony] is that in most cases, the determination of an attorney's standard of care, which depends on the particular circumstances of the attorney's representation, is beyond the experience of the average layperson, including members of the jury and perhaps even the presiding judge." (Internal quotation marks omitted.) Marciano v. Kraner, 126 Conn.App. 171, 179, 10 A.3d 572, cert. denied, 300 Conn. 922, 14 A.3d 1007 (2011). "The exception to the need for expert testimony is limited to situations in which the . . . attorney essentially has done nothing whatsoever to represent his or her client's interests, resulting in such an obvious and gross want of care and skill that the neglect would be clear even to a layperson." (Internal quotation marks omitted.) Law Offices of Robert K. Walsh, LLC v. Natarajan, supra, 864.
"[A] court may not grant summary judgment sua sponte . . . The issue first must be raised by the motion of a party and supported by affidavits, documents or other forms of proof." (Internal quotation marks omitted.) Miller v. Bourgoin, 28 Conn.App. 491, 500, 613 A.2d 292, cert. denied, 223 Conn. 927, 614 A.2d 825 (1992). Since the defendant has not raised the issue of the plaintiff's failure to proffer expert testimony, the court will not consider this issue.
"Under Connecticut law, [c]ollateral estoppel, or issue preclusion, prohibits the relitigation of an issue when that issue was actually litigated and necessarily determined in a prior action . . . For an issue to be subject to collateral estoppel, it must have been fully and fairly litigated in the first action. It also must have been actually decided and the decision must have been necessary to the judgment . . . The doctrine of collateral estoppel is based on the public policy that a party should not be able to relitigate a matter which it already has had an opportunity to litigate . . . Hence, a party may assert the doctrine of collateral estoppel successfully when three requirements are met: [1] [t]he issue must have been fully and fairly litigated in the first action, [2] it must have been actually decided, and [3] the decision must have been necessary to the judgment." (Citation omitted; internal quotation marks omitted.) Gateway, Kelso Co. v. West Hartford No. 1, LLC, supra, 126 Conn.App. 583-84.
In addition, "[c]ollateral estoppel may be invoked against a party to a prior adverse proceeding or against those in privity with that party." (Internal quotation marks omitted.) Terracino v. Buzzi, 121 Conn.App. 846, 853, 1 A.3d 115 (2010). Neither party has briefed or argued the issue of privity.
"Additionally, [a]pplication of the doctrine of collateral estoppel is neither statutorily nor constitutionally mandated. The doctrine, rather, is a judicially created rule of reason that is enforced on public policy grounds . . . [T]he decision whether to apply the doctrine of collateral estoppel in any particular case should be made based upon a consideration of the doctrine's underlying policies, namely, the interests of the defendant and of the courts in bringing litigation to a close . . . and the competing interest of the plaintiff in the vindication of a just claim . . . These [underlying] purposes are generally identified as being (1) to promote judicial economy by minimizing repetitive litigation; (2) to prevent inconsistent judgments which undermine the integrity of the judicial system; and (3) to provide repose by preventing a person from being harassed by vexations litigation . . . We have also explained that [c]ourts should be careful that the effect of the doctrine does not work an injustice . . . Thus, [t]he doctrines of preclusion . . . should be flexible and must give way when their mechanical application would frustrate other social policies based on values equally or more important than the convenience afforded by finality in legal controversies." (Citation omitted; internal quotation marks omitted.) Lighthouse Landings, Inc. v. Connecticut Light Power Co., 300 Conn. 325, 344-45, 15 A.3d 601 (2011).
In the prior action, the district court made the following relevant findings of fact. The first contact between O'Connor and the plaintiff, relating to the plaintiff's association with Bolin, occurred on March 30, 2004. The plaintiff explained her involvement with Bolin to O'Connor, who "offered to conduct a UCC search for her to see whether any note or agreement had been filed with the Connecticut Secretary of State securing her loan." In re Bolin Co., LLC, Roland Corches, Trustee of the Estate of Bolin Co., LLC v. Ogden, supra, 15, United States District Court, Docket No. 3:08cv1793. Judge Underhill found that O'Connor "did not counsel Ogden to demand repayment of her loan or take any self-help steps," and that "O'Connor did not speak with Ogden again or reveal the results of the UCC search until July 28, 2004."
"At about 3:15 [p.m. on July 28, 2004], Ogden called Brian O'Connor at his office out of concern that Bolin was failing and that her loans were unprotected. O'Connor told Ogden that she was a secured creditor and had rights in the collateral, but cautioned that he had not reviewed her file recently and did not remember what her exact rights were." In re Bolin Co., LLC, Roland Corches, Trustee of the Estate of Bolin Co., LLC v. Ogden, supra, 16, United States District Court, Docket No. 3:08cv1793. "O'Connor spoke with Ogden on July 30 to follow up on their discussion of the security of Ogden's loan to Bolin. O'Connor reported to Ogden what he found in conducting his UCC search and said that he had located a promissory note entitling her to collateral in the event of default . . . He also advised her that the promissory note defined default as Bolin's failure to pay Ogden within five days of receiving notice that payment was due. O'Connor told Ogden that only after the five days had expired could she repossess collateral in order to secure her loan." Id., 20. "O'Connor counseled Ogden to be careful to take actions consistent with being Bolin's creditor, and not the store's manager or owner; furthermore, he advised Ogden not to remove anything from the store until the five-day waiting period had expired." Id., 21.
The plaintiff argues that the district court did not find that O'Connor did not advise her on July 28, 2004 that she could take immediate possession of the Bolin jewelry. As discussed above, however, the district court found that during their July 28, 2004 conversation, O'Connor cautioned the plaintiff that he had not recently reviewed her file. Moreover, he advised her that he was unsure of her exact rights as a creditor. Prior to their July 28 conversation, O'Connor did not advise her to demand repayment of her loan or take any other self-help steps. As discussed above, Judge Underhill found that O'Connor then spoke with the plaintiff on July 30, 2004, at which time he advised her that she could take physical possession of the property, but only five days after she gave notice to Bolin. These factual findings establish that the district court decided that O'Connor did not advise the plaintiff that she could take immediate possession of the Bolin jewelry on July 28, 2004.
For the doctrine of collateral estoppel to apply, however, the plaintiff must have had an opportunity to fully litigate this specific issue in the prior action and that decision must have been necessary to the judgment. It is not enough that the district court made the factual finding that on July 28, 2004, O'Connor had not advised the plaintiff that she could take immediate repossession. Rather, "[i]f an issue has been determined, but the judgment is not dependent [on] the determination of the issue, the parties may relitigate the issue in a subsequent action." (Internal quotation marks omitted.) Lighthouse Landings, Inc. v. Connecticut Light Power Co., supra, 300 Conn. 344. "An issue is actually litigated if it is properly raised in the pleadings or otherwise, submitted for determination, and in fact determined." (Internal quotation marks omitted.) Id. The defendant here bears the burden of proving that there is no genuine issue of material fact that the district court actually and necessarily reached this issue regarding O'Connor's July 28, 2004 advise to the plaintiff on immediate repossession.
As previously noted, the district court, Underhill, J., found, inter alia, that Ogden was liable for tortious interference with business relations. The defendant argues that the requirements for applying collateral estoppel are satisfied because the district court finding regarding O'Connor's advice was necessary to its decision on the tortious interference claim. Judge Underhill found, inter alia, that Ogden was liable for tortious interference with business relations for contacting third-party vendors and returning the consigned Bolin jewelry to them. The theory of the tortious interference claim was that the plaintiff "interfered with Bolins' business relationships when she and Hovey returned items in Bolin's possession to vendors and customers during the week of July 30, 2004 and that had [the plaintiff] not returned jewels to vendors and customers, Bolin could have continued its business upon [the owner of Bolin's] return and avoided its hasty bankruptcy." The defendant further argues that reliance on the advice of an attorney provides justification to defeat a claim of tortious interference and that the district court determined that the plaintiff acted without first securing the advice of counsel, and this determination was necessary to the court's conclusion that she acted without justification. Thus, it is the defendant's position that "had the court found that O'Connor had advised [the plaintiff] that she was entitled to immediately repossess the jewelry and contact the vendors, it would have found in her favor on the tortious interference claim."
The district court wrote: "In addition, [the plaintiff] has not shown any justification for her conduct. Although [the plaintiff] was within her personal right to repossess Bolin's jewelry as collateral for her secured loan, her security agreement did not entitle her to return any consigned items to third-party owners." In re Bolin Co., LLC v. Ogden, supra, 43 United States District Court, Docket No. 3:08cv1793. The defendant maintains that Judge Underhill, in rejecting the claim that the plaintiff was justified in her tortious interference with Bolin's business expectancies, determined that the defendant had not advised her that she was entitled to immediately repossess the jewelry and contact the vendors.
The defendant's argument fails for two reasons. First, the defendant fails to offer evidence demonstrating that, by rejecting the plaintiff's justification defense, the district court considered whether the plaintiff had relied on O'Connor's advice. Second, the district court determination that the plaintiff was liable for tortious interference was not based on the plaintiff's repossession of the Bolin jewelry, but rather, on her contacting third-party vendors and consigning the jewelry to them.
"[I]n order to recover for a claim of tortious interference with business expectancies, the claimant must plead and prove that: (1) a business relationship existed between the plaintiff and another party; (2) the defendant intentionally interfered with the business relationship while knowing of the relationship; and (3) as a result of the interference, the plaintiff suffered actual loss." (Internal quotation marks omitted.) Robinson v. Robinson, 103 Conn.App. 69, 77, 927 A.2d 364 (2007). "The plaintiff in a tortious interference claim must demonstrate malice on the part of the defendant, not in the sense of ill will, but intentional interference without justification." (Internal quotation marks omitted.) Stancuna v. Schaffer, 122 Conn.App. 484, 488, 998 A.2d 1221 (2010). Therefore, justification is a defense to a claim of tortious interference. See Daley v. Aetna Life Casualty Co., 249 Conn. 766, 806, 734 A.2d 112 (1999).
The district court found that "Ogden has not shown any justification for her conduct," In re Bolin Co., LLC, Roland Corches, Trustee of the Estate of Bolin Co., LLC v. Ogden, supra, 43, United States District Court, Docket No. 3:08cv1793, referring to the conduct of Ogden in contacting third-party vendors and returning the consigned Bolin jewelry to them. The district court did not decide that the plaintiff lacked justification for the repossession, holding that "Ogden was within her personal right to repossess Bolin's jewelry as collateral for her secured loan . . ." The defendant's claim that Judge Underhill's decision actually considered reliance on O'Connor's advice as a justification defense for the plaintiff is without support in the evidence submitted to this court.
Here, the defendant has not met its burden of proof on the issue of what advice O'Connor provided to the plaintiff was raised in the pleadings or submitted to the district court for determination. In other words, the defendant has failed to demonstrate that the district court actually and necessarily determined, for purposes of collateral estoppel, that O'Connor did not advise the plaintiff that she could immediately repossess the Bolin jewelry on July 28, 2004. As discussed above, the district court judgment in the prior action was not dependent on its determination regarding O'Connor's advice to the plaintiff. The defendant has failed its burden of eliminating all issues of material fact on this issue, and collateral estoppel does not preclude the plaintiff's legal malpractice claim because the prior district court decision did not provide the plaintiff with an opportunity to fully and fairly litigate the issue of the advice O'Connor rendered to her.
Alternatively, the defendant argues that, even if O'Connor advised the plaintiff that she could immediately repossess the jewelry, the district court already decided that repossession was legally correct. The defendant contends that since O'Connor's alleged advice was correct, he cannot be liable for legal malpractice. For a legal malpractice claim, the attorney must have made a wrongful act or omission. Our Supreme Court recently cited in Picco v. Voluntown, 295 Conn. 141, 989 A.2d 593 (2010), Webster's Third New International Dictionary for the definition of "omission" as, "something left out, not done, or neglected." (Internal quotation marks omitted.) Id., 148. The plaintiff's legal malpractice claim, as alleged in the complaint, is based, at least in part, on O'Connor's "failure to advise plaintiff to utilize less risky alternatives . . . [and] because he failed even to inform plaintiff . . . that such alternatives exist." This conduct complained of, if proven, falls directly within the meaning of something not done or neglected. Even if O'Connor's alleged advice that the plaintiff could immediately repossess the Bolin jewelry was legally accurate, this does not preclude the plaintiff's legal malpractice claim. Therefore, the court need not determine whether collateral estoppel applies to the district court finding of the correctness of this alleged advice.
As discussed above, this court concludes that the district court decided that O'Connor did not advise the plaintiff in this way. The court, however, also concludes that collateral estoppel does not apply to this factual finding. Thus, this court will consider the defendant's second, alternative argument.
CONCLUSION
For the foregoing reasons, the defendant's motion for summary judgment on the ground that collateral estoppel precludes the plaintiff's legal malpractice claim is denied.