Durham v. Guest

2007 NMCA 144, 171 P.3d 756, 142 N.M. 817
CourtNew Mexico Court of Appeals
DecidedAugust 31, 2007
DocketNo. 26,123
StatusPublished
Cited by14 cases

This text of 2007 NMCA 144 (Durham v. Guest) 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
Durham v. Guest, 2007 NMCA 144, 171 P.3d 756, 142 N.M. 817 (N.M. Ct. App. 2007).

Opinion

OPINION

CASTILLO, Judge.

{1} This case comes to us on the district court’s dismissal of a complaint under Rule 1 — 012(B)(6) NMRA. We affirm the district court.

I. BACKGROUND

{2} Based on the facts alleged in the complaint and the attached exhibits, we provide a general background of the case. Other facts will be added in the context of the issues as they are discussed. Plaintiffs, Jamie and Travis Durham, were insured under an automobile insurance policy issued by Allstate Insurance Company (Allstate). Plaintiffs’ uninsured motorist (UM) coverage limit on the policy was $25,000 per person/$50,000 per accident. On March 11,1997, Plaintiffs were involved in an automobile accident caused by an uninsured driver who was driving while intoxicated. Plaintiffs hired an attorney, who, on March 13, 1997, made a claim for UM coverage under the policy. On March 25, 1997, Plaintiffs’ attorney put Allstate on notice that the claim would go to arbitration, and she named her choice of arbitrator.

{3} Plaintiffs’ claim was first handled by adjuster Geri Moya and then by adjuster Susan Cary. On January 12, 1998, Plaintiffs’ attorney provided Plaintiffs’ medical records and associated billings to another Allstate employee. On January 27, 1998, Plaintiffs’ attorney demanded payment of the policy limits for Plaintiffs.

{4} On March 2, 1998, almost a year after Plaintiffs’ attorney first demanded arbitration, Allstate hired Defendant, Suzanne Guest, to act as its counsel for arbitration proceedings regarding Plaintiffs’ claims. The same day, Defendant contacted Plaintiffs’ attorney and advised her that Allstate had referred Plaintiffs’ claim to her. At that time, Defendant was an attorney with The Farlow Law Firm.

{5} On March 24, 1998, Defendant wrote Plaintiffs’ attorney regarding matters related to the arbitration, such as suggested dates, panel members, discovery details, and potential witness lists. On October 13, 1998, Allstate offered to settle Plaintiffs’ claims for $13,300 — $5,800 for Jamie’s claim and $7,500 for Travis’s claim. The arbitration was held, and in late November 1998, the arbitration panel awarded $45,000, plus costs, to Plaintiffs. The arbitration award, exclusive of costs, exceeded the settlement offer by more than $31,000.

{6} On January 30, 2002, Plaintiffs filed a complaint against Defendant, Allstate, and the Allstate agent who sold the policy to Plaintiffs. The complaint alleges fourteen separate causes of action arising out of the claims processing and litigation tactics used during the handling and arbitration of Plaintiffs’ UM claims. The claims against Allstate and its agent are not the subject of this appeal. Here, we address exclusively the claims against Defendant.

{7} Plaintiffs assert that Defendant’s duties in her role as arbitration counsel included adjusting, investigating, and evaluating Plaintiffs’ claim, which Defendant carried out in accordance with Allstate’s claims handling and litigation protocols. In their complaint, Plaintiffs allege that in following Allstate’s protocols, Defendant aided Allstate in the breach of its fiduciary duty to Plaintiffs. Plaintiffs also allege that Defendant engaged directly in various statutory violations; in addition, Plaintiffs allege that Defendant, together with Allstate, maliciously abused the legal processes of subpoenas and arbitration. Plaintiffs allege that Defendant’s wrongful actions occurred between March 2, 1998, and November 19, 1998, when Defendant was representing Allstate in the arbitration of Plaintiffs’ claims.

{8} Specifically, Plaintiffs’ complaint alleges six named causes of action against Defendant: Count VII — violation of the Trade Practices and Frauds Act; Count VIII — aiding and abetting a violation of fiduciary duty; Count IX — unjust enrichment; Count X— malicious abuse of process; Count XI — malicious defense; and Count XII — prima facie tort. Defendant filed two motions to dismiss these claims under Rule 1 — 012(B)(6), and the district court issued two orders, which together dismissed all counts against Defendant.

{9} Plaintiffs do not appeal the district court’s dismissal of Counts IX, XI and XII. Therefore, we do not consider the causes of action for unjust enrichment, malicious defense, or prima facie tort. See Garcia v. Rodey, Dickason, Sloan, Akin & Robb, P.A., 106 N.M. 757, 760, 750 P.2d 118, 121 (1988) (stating that a claim that is not briefed on appeal is deemed abandoned); State ex rel. State Highway & Transp. Dep’t v. City of Sunland Park, 1999-NMCA-143, ¶11, 128 N.M. 371, 993 P.2d 85 (stating that issues not argued on appeal will not be considered).

{10} On appeal, Plaintiffs contend that the complaint states a cause of action under five theories: (1) aiding and abetting Allstate’s breach of its fiduciary duty to Plaintiffs; (2) aiding and abetting Allstate’s violation of various provisions in the New Mexico Insurance Code (Insurance Code), see NMSA 1978, § 59A-1-1 (1993); (3) direct violations of various provisions in the Insurance Code; (4) tortious interference with contractual rights; and (5) malicious abuse of process. We address each issue in turn.

{11} We conclude that because an arbitration is an adversarial proceeding, an attorney who is representing a client in an arbitration is not liable for aiding and abetting a breach of the client’s fiduciary duty, unless the attorney acted outside the scope of representation, acted only in his or her own self-interest and contrary to the client’s interest, or acted in a manner that would fall within the “crime or fraud” exception to the attorney-client privilege provided in the rules of professional conduct. We further conclude that an attorney who does not meet the statutory definition of “adjuster,” pursuant to Section 59A-13-2, is not liable for direct violations of the TPFA. Finally, we determine that under these circumstances, an arbitration proceeding is not a judicial proceeding for purposes of a claim for malicious abuse of process. We decline to reach Plaintiffs’ remaining claims because they failed to preserve these arguments. In light of the allegations in Plaintiffs’ complaint and their arguments made below and on appeal, we hold that Plaintiffs have failed to state a claim upon which relief can be granted. Accordingly, we affirm the district court’s orders granting Defendant’s motions to dismiss.

II. DISCUSSION

A. Standard of Review

{12} In reviewing the grant of Defendant’s motions to dismiss pursuant to Rule 1-012(B)(6), we accept all of the facts in Plaintiffs’ complaint as true, and we review de novo the question of whether the district court properly applied the law to those facts. See R & R Deli, Inc. v. Santa Ana Star Casino, 2006-NMCA-020, ¶2, 139 N.M. 85, 128 P.3d 513; Butler v. Deutsche Morgan Grenfell, Inc., 2006-NMCA-084, ¶6, 140 N.M. 111, 140 P.3d 532 (“We review a district court’s grant of a motion to dismiss de novo, accepting as true all of the appellant’s well-pleaded allegations.”). “[Gjeneral allegations of conduct are sufficient, as long as they show that the party is entitled to relief and the averments are set forth with sufficient detail so that the parties and the court will have a fair idea of the action about which the party is complaining and can see the basis for relief.” Schmitz v. Smentowski, 109 N.M.

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Bluebook (online)
2007 NMCA 144, 171 P.3d 756, 142 N.M. 817, Counsel Stack Legal Research, https://law.counselstack.com/opinion/durham-v-guest-nmctapp-2007.