Computer One, Inc. v. Grisham & Lawless

161 P.3d 914
CourtNew Mexico Court of Appeals
DecidedJune 13, 2007
Docket25,732
StatusPublished
Cited by1 cases

This text of 161 P.3d 914 (Computer One, Inc. v. Grisham & Lawless) is published on Counsel Stack Legal Research, covering New Mexico Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Computer One, Inc. v. Grisham & Lawless, 161 P.3d 914 (N.M. Ct. App. 2007).

Opinion

161 P.3d 914 (2007)
2007-NMCA-079

COMPUTER ONE, INC., a New Mexico corporation, and Caroline C. Roberts, individually, Plaintiffs-Appellants,
v.
GRISHAM & LAWLESS, P.A., a professional association, Thomas L. Grisham, and Stephen F. Lawless, Defendants-Appellees.

No. 25,732.

Court of Appeals of New Mexico.

April 30, 2007.
Certiorari Granted June 13, 2007.

*915 William G. Gilstrap, P.C., William G. Gilstrap, Albuquerque, NM, for Appellants.

Law Office of Briggs F. Cheney, Briggs F. Cheney, Jaime L. Dawes, Albuquerque, NM, for Appellees.

Certiorari Granted, No. 30,425, June 13, 2007.

OPINION

WECHSLER, Judge.

{1} Plaintiffs, Computer One, Inc., and its president, Caroline C. Roberts (both referred to as "Computer One"), sued their former attorneys Grisham & Lawless, both individually and as a firm, alleging legal malpractice. The district court granted summary judgment in favor of Defendants on the basis of claim preclusion (res judicata), finding that Computer One's legal malpractice claims were the same claims it had asserted in response to Defendants' attorney charging lien in the prior litigation. On appeal, Computer One contends that it was not required to raise its legal malpractice claims as compulsory counterclaims to the attorney charging lien because it was not an opposing party to Defendants under Rule 1-013(A) NMRA and that the claims were not the same. We conclude that the district court did not err in granting summary judgment, and we affirm.

BACKGROUND

{2} Defendants represented Computer One in a breach of contract action against Sandia Corporation. Defendants entered into settlement negotiations with Sandia Corporation and eventually agreed to settle Computer One's claims for $750,000. After Defendants negotiated the settlement, Computer One alleged that Defendants did not have authority to settle its claims. Defendants withdrew from representing Computer One and filed an attorney charging lien.

{3} Sandia Corporation filed a motion to enforce the settlement. Computer One objected, again stating that Defendants had no authority to enter the settlement agreement on its behalf. Following an evidentiary hearing, the district court found that Computer One had given Defendants authority to settle *916 its claims for $750,000, and the court entered an order enforcing the settlement.

{4} The district court held a hearing on the attorney charging lien. At this hearing, the parties discussed the priority of claims between Defendants and another creditor of the settlement. Computer One then stated that it intended to dispute the enforceability of Defendants' claim for attorney fees. Computer One requested a hearing on that issue and stated that it would be filing objections to the charging lien. The district court gave Computer One ten days in which to file its objections.

{5} In its objections to the charging lien, Computer One alleged that the attorney fees claimed by Defendants were excessive and unreasonable because Defendants: (1) negotiated the settlement without consent; (2) released potential claims of both Computer One and Roberts without authority and to their economic detriment; and (3) failed to pursue a malpractice claim valued at 1.5 million dollars against predecessor counsel and failed to negotiate an attorney charging lien filed by predecessor counsel. Computer One also claimed that (4) the amended charging lien included fees for services not related to representation of Computer One in the action; and (5) the contingency fee agreement on which the charging lien was based did not conform to Rule 16-105(C) NMRA, and was therefore unenforceable. Computer One repeated these objections in its response to Sandia Corporation's motion to disburse the settlement proceeds. The court held a hearing on Sandia Corporation's motion to disburse fees and on Defendants' attorney charging lien on February 11, 2002. It issued an order allowing disbursement of settlement funds by Sandia Corporation.

{6} Over a year after entry of the order on the charging lien, Computer One sued Defendants for legal malpractice. Computer One claimed that Defendants' recommendation to accept settlement for $750,000 constituted professional negligence. Computer One alleged that Defendants failed to properly assess the available damages for breach of contract in the Sandia case, failed to properly advise their clients regarding evaluation of the settlement, and coerced their clients into settlement by threatening withdrawal.

{7} Defendants moved for summary judgment, arguing that Computer One's legal malpractice claims were barred by claim preclusion. In granting the motion, the district court stated that Computer One had raised legal malpractice claims in the litigation concerning the attorney charging lien and had been unsuccessful. The district court also found that Computer One had the opportunity to litigate the issue of whether there had been an improper handling of the litigation by Defendants and was attempting to relitigate the issue by raising different legal theories. Computer One appeals.

STANDARD OF REVIEW

{8} We affirm the grant of summary judgment when there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. Krieger v. Wilson Corp., 2006-NMCA-034, ¶ 30, 139 N.M. 274, 131 P.3d 661, cert. quashed, 2006-NMCERT-012, 141 N.M. 105, 151 P.3d 66. Because the material facts are undisputed, we review the district court order granting summary judgment de novo. See id. Whether claim preclusion applies is also a matter of law, which we review de novo. Moffat v. Branch, 2005-NMCA-103, ¶ 10, 138 N.M. 224, 118 P.3d 732, cert. quashed, 2006-NMCERT-003, 139 N.M. 353, 132 P.3d 1039. The burden of showing the elements of claim preclusion is on Defendants. Id.

CLAIM PRECLUSION

{9} "The form of res judicata known as claim preclusion prevents parties from relitigating claims after those claims have been litigated once." Hope Cmty. Ditch Ass'n v. N.M. State Eng'r, 2005-NMCA-002, ¶ 8, 136 N.M. 761, 105 P.3d 314. Claim preclusion rests on the need to balance the interests of defendants and the courts, on the one hand, to bring a close to litigation, and of plaintiffs, on the other hand, to seek relief of their claims. See Anaya v. City of Albuquerque, 1996-NMCA-092, ¶ 8, 122 N.M. 326, 924 P.2d 735. It bars not only claims that were actually raised in a prior litigation, but also claims that could have *917 been raised in a prior litigation. State ex rel. Martinez v. Kerr-McGee Corp., 120 N.M. 118, 121, 898 P.2d 1256, 1259 (Ct.App.1995). Its bar embraces compulsory counterclaims. See Bentz v. Peterson, 107 N.M. 597, 601, 762 P.2d 259, 263 (Ct.App.1988) ("Failure to plead a compulsory counterclaim bars a later action on that claim[.]"). For claim preclusion to apply, four requirements must exist. "The two actions (1) must involve the same parties or their privies, (2) who are acting in the same capacity or character, (3) regarding the same subject matter, and (4) must involve the same claim." Moffat, 2005-NMCA-103, ¶ 11, 138 N.M.

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Related

Computer One, Inc. v. Grisham & Lawless P.A.
2008 NMSC 038 (New Mexico Supreme Court, 2008)

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Bluebook (online)
161 P.3d 914, Counsel Stack Legal Research, https://law.counselstack.com/opinion/computer-one-inc-v-grisham-lawless-nmctapp-2007.