Articles

Namikas v. Miller (May 7, 2014, B244685) __ Cal.App.4th __

Earlier this month, the California Court of Appeal, Second Appellate District, Division Six (Los Angeles) issued an opinion in Namikas v. Miller (May 7, 2014, B244685) __ Cal.App.4th__, analyzing a settle and sue case. The Court of Appeal held that plaintiff “failed to establish a triable issue of material fact as to whether, in the absence of the alleged negligence would have received a more favorable judgment or settlement.”

Defendants, attorneys, represented plaintiff in his divorce proceedings. After extensive negotiations between plaintiff and his former wife, also represented by counsel, the parties stipulated to entry of judgment based upon a martial settlement agreement (MSA). The MSA provided for permanent spousal support to plaintiff’s ex-wife of $7,000 per month. Plaintiff’s attorney informed him that the marital standard of living is a factor courts consider in awarding spousal support, but did not suggest that plaintiff obtain a forensic marital standard of living analysis. Plaintiff accepted the settlement, “in part, because it imputed $4,000 in income to even though she was unemployed, ended the costly dissolution proceeding and resulted in after-tax support payments of $3,855 per month.” Subsequently, plaintiff retained a different law firm to request modification of spousal support. The trial court reduced his spousal support payments to $2,750. 

Plaintiff then sued his former attorneys for legal malpractice, claiming their negligence caused him to pay excessive spousal support. He alleged his former attorneys “negligently failed to conduct a marital standard of living analysis prior to recommending settlement and had improperly used the DissoMaster program to calculate permanent support.” The trial court granted defendants’ summary judgment motion finding that no triable issue of material facts existed as to causation and damages. Plaintiff appealed.

The Court of Appeal affirmed. The court held that plaintiff “did not produce evidence to justify a finding of triable issues of fact about whether, without any legal malpractice occurring, he would have received a more favorable settlement or outcome at trial.” In a legal malpractice case, the elements of causation and damage are closely linked. “The plaintiff must prove, by a preponderance of evidence, that but for the attorney’s negligent acts or omissions, he would have obtained a more favorable judgment or settlement in the action in which the malpractice allegedly occurred.” Thus, “standard requires a ‘trial-within-a-trial’ of the underlying case, in which the malpractice jury must decide what a reasonable jury or court would have done if the underlying matter had been trial instead of settled.” (Ibid.) The court found there was no evidence as to what the settlement amount would have been. The court explained that it is particularly difficult to prove damages to a legal certainty in a settle and sue case because the damages are inherently speculative. Accordingly, “any actual harm from respondents’ conduct is only a subject of surmise, given the myriad of variable that affect settlements.” The court concluded that the record did not “support a conclusion that causation questions remain about damages, based on any argument the settlement was excessive in light of all the variables and circumstances.”

Related Practices

• Professional Liability

Related Attorneys