No. 94-249 IN THE SUPREME COURT OF THE STATE OF MONTANA 1994
MARK C. EATINGER, individually and as Personal Representative of the Estate of Ruth Eatinger, deceased, BETH ANN HENDERSON, and JULIE SILVAN, Plaintiffs and Respondents, v. ROBERT L. JOHNSON, Defendant and Appellant.
APPEAL FROM: District Court of the Tenth Judicial District, In and for the County of Fergus, The Honorable Larry W. Moran, Judge presiding.
COUNSEL OF RECORD: For Appellant: Robert L. Johnson (Pro Se) and Monte Boettger, Attorneys at Law, Lewistown, Montana For Respondents: Torger S. Oaas, Attorney at Law, Lewistown, Montana
Submitted on Briefs: December 8, 1994 Decided: December 22, 1994 Filed:
Clerk Justice Terry N. Trieweiler delivered the opinion of the Court.
Plaintiffs Mark C. Eatinger, Beth Ann Henderson, and Julie
Silvan filed a complaint in the District Court for the Tenth
Judicial District in Fergus County in which Robert L. Johnson is
named as the defendant. The plaintiffs alleged that they sustained
damages as a result of Johnson's conversion of settlement proceeds
which belonged to them. A jury returned a verdict in the
plaintiffs favor and awarded $17,702.96 as damages. Johnson
appeals from the judgment entered pursuant to the jury's verdict.
We affirm the judgment of the District Court. The issues on appeal are:
1. Did the District Court err when it denied Johnson's motion
for summary judgment?
2. Did the District Court abuse its discretion when it
refused to delay trial of the conversion claim until the Probate
Court decided the amount of Johnson's fee?
3. Did the District Court err when it did not instruct the
jury that an attorney has a right to retain possession of a
client's money until he or she is paid for services rendered?
4. Did the District Court abuse its discretion when it
refused to grant Johnson's motion for a directed verdict?
FACTUAL BACKGROUND In May of 1989, Ruth Eatinger died after she was hit by a
pickup truck while crossing the street in Lewistown, Montana. She
was survived by plaintiffs Mark C. Eatinger, Beth Ann Henderson, and Julie Silvan. Mark Eatinger was named the personal
representative of the estate.
The plaintiffs hired attorney Robert L. Johnson to probate
Ruth's estate and to pursue wrongful death and survival claims
against the driver of the vehicle that struck Ruth. There was no
written fee agreement entered into by the parties.
The parties presented contradictory evidence of their
agreement. The plaintiffs claim that they agreed to pay Johnson
the statutorily determined fee for his probate services, but that
he was not to be paid an additional amount for settling the tort
claims. Johnson agrees that he was to receive the statutory fee
for his probate work, but contends that Mrs. Eatinger's survivors
agreed to pay him a percentage of the tort recovery. Beth and Julie testified that they became dissatisfied with
Johnson and sought advice from a different attorney whom they hired
to pursue the tort claims. Testimony and evidence indicated that
Mark phoned Johnson on January 17, 1990, to terminate his services.
Johnson denied he was terminated at that time, but his letter to
Mark, dated January 23, 1990, confirms a conversation on
January 17, 1990, during which Mark informed him that the
plaintiffs were retaining another attorney. Evidence indicated
that by January 18, 1990, Johnson was offered $95,000 to settle the
tort claims, and that he later received a draft for that amount
which was made payable to the Estate of Ruth Eatinger, and to
Johnson, as the attorney for the estate. The plaintiffs were surprised when they discovered that
Johnson received the settlement draft because they had hired
another attorney to pursue the claims. Following this discovery, Beth hand-delivered a letter to Johnson instructing him not to cash
the settlement draft, even though Mark had already endorsed it,
because the plaintiffs' position was that he was no longer their
attorney. By letter, dated January 31, 1990, Johnson responded
that if he received the draft he would endorse it, cash it, and
place the proceeds in a trust account.
Mark also called Johnson and requested that he not negotiate
the settlement draft. Johnson again responded by letter dated
February 1, 1990, and acknowledged Mark's preference that Johnson
do nothing with the insurance money, but stated that he had put the
money in a trust account.
On that same date, Johnson cashed the check, placed the
proceeds in a trust account, and withdrew $2500 from the account
and placed it in his general account. There was evidence that this
money was used to pay his office expenses. Johnson testified that
he withdrew this money to protect the Eatinger estate by paying its
creditors. However, there was a separate estate account to pay
creditors.
Bank records also indicate that on March 6 and 7, 1990,
Johnson withdrew an additional $7000 to, at least in part, cover
two checks he wrote to himself from his general office account.
Without these withdrawals, bank records show that there would have
been insufficient funds in Johnson's account to cover checks he had
4 written. Later records establish that Johnson withdrew $2,851.53
earned as interest on the amount remaining in the trust account.
The plaintiffs did not consent to Johnson's disposition of the settlement proceeds. In February 1990, they hired Tim O'Hare to
represent them in the probate proceeding. O'Hare testified that he
called Johnson and demanded the settlement money in February, but
that Johnson refused to tender it. Johnson denied these
conversations. O'Hare eventually received the funds, but Johnson
asserted a lien on $10,000 to secure payment of his probate fee,
and did not turn over the interest. Later, the Probate Court
decided Johnson was entitled to $5000 as fees for probate services.
After plaintiffs hired yet another attorney to file suit
against Johnson for conversion, Johnson petitioned the Probate
Court to determine the remainder of his fee. The Probate Court
deferred to the District Court as the proper forum for resolution
of the conversion claim and the related attorney fee issue. The
case was tried twice; both times a mistrial resulted. Before the
third trial, Johnson moved for summary judgment and his motion was denied.
Johnson's testified that he believed he was entitled to a fee
from the settlement proceeds. He claimed that he also had a right to assert control over additional money because he had an attorney's lien against the settlement to pay for his probate
services. Johnson claims that the plaintiffs disputed the appropriate use of the settlement money and, perceiving a conflict,
he decided to put the money in a trust account. He claims that he
5 then withdrew from the probate proceeding because he was also a
creditor of the estate. The jury did not accept Johnson's defenses
and rendered a verdict in favor of the plaintiffs. The jury also awarded plaintiffs compensatory damages, punitive damages, and
costs.
ISSUE 1
Did the District Court err when it denied Johnson's motion for
summary judgment?
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No. 94-249 IN THE SUPREME COURT OF THE STATE OF MONTANA 1994
MARK C. EATINGER, individually and as Personal Representative of the Estate of Ruth Eatinger, deceased, BETH ANN HENDERSON, and JULIE SILVAN, Plaintiffs and Respondents, v. ROBERT L. JOHNSON, Defendant and Appellant.
APPEAL FROM: District Court of the Tenth Judicial District, In and for the County of Fergus, The Honorable Larry W. Moran, Judge presiding.
COUNSEL OF RECORD: For Appellant: Robert L. Johnson (Pro Se) and Monte Boettger, Attorneys at Law, Lewistown, Montana For Respondents: Torger S. Oaas, Attorney at Law, Lewistown, Montana
Submitted on Briefs: December 8, 1994 Decided: December 22, 1994 Filed:
Clerk Justice Terry N. Trieweiler delivered the opinion of the Court.
Plaintiffs Mark C. Eatinger, Beth Ann Henderson, and Julie
Silvan filed a complaint in the District Court for the Tenth
Judicial District in Fergus County in which Robert L. Johnson is
named as the defendant. The plaintiffs alleged that they sustained
damages as a result of Johnson's conversion of settlement proceeds
which belonged to them. A jury returned a verdict in the
plaintiffs favor and awarded $17,702.96 as damages. Johnson
appeals from the judgment entered pursuant to the jury's verdict.
We affirm the judgment of the District Court. The issues on appeal are:
1. Did the District Court err when it denied Johnson's motion
for summary judgment?
2. Did the District Court abuse its discretion when it
refused to delay trial of the conversion claim until the Probate
Court decided the amount of Johnson's fee?
3. Did the District Court err when it did not instruct the
jury that an attorney has a right to retain possession of a
client's money until he or she is paid for services rendered?
4. Did the District Court abuse its discretion when it
refused to grant Johnson's motion for a directed verdict?
FACTUAL BACKGROUND In May of 1989, Ruth Eatinger died after she was hit by a
pickup truck while crossing the street in Lewistown, Montana. She
was survived by plaintiffs Mark C. Eatinger, Beth Ann Henderson, and Julie Silvan. Mark Eatinger was named the personal
representative of the estate.
The plaintiffs hired attorney Robert L. Johnson to probate
Ruth's estate and to pursue wrongful death and survival claims
against the driver of the vehicle that struck Ruth. There was no
written fee agreement entered into by the parties.
The parties presented contradictory evidence of their
agreement. The plaintiffs claim that they agreed to pay Johnson
the statutorily determined fee for his probate services, but that
he was not to be paid an additional amount for settling the tort
claims. Johnson agrees that he was to receive the statutory fee
for his probate work, but contends that Mrs. Eatinger's survivors
agreed to pay him a percentage of the tort recovery. Beth and Julie testified that they became dissatisfied with
Johnson and sought advice from a different attorney whom they hired
to pursue the tort claims. Testimony and evidence indicated that
Mark phoned Johnson on January 17, 1990, to terminate his services.
Johnson denied he was terminated at that time, but his letter to
Mark, dated January 23, 1990, confirms a conversation on
January 17, 1990, during which Mark informed him that the
plaintiffs were retaining another attorney. Evidence indicated
that by January 18, 1990, Johnson was offered $95,000 to settle the
tort claims, and that he later received a draft for that amount
which was made payable to the Estate of Ruth Eatinger, and to
Johnson, as the attorney for the estate. The plaintiffs were surprised when they discovered that
Johnson received the settlement draft because they had hired
another attorney to pursue the claims. Following this discovery, Beth hand-delivered a letter to Johnson instructing him not to cash
the settlement draft, even though Mark had already endorsed it,
because the plaintiffs' position was that he was no longer their
attorney. By letter, dated January 31, 1990, Johnson responded
that if he received the draft he would endorse it, cash it, and
place the proceeds in a trust account.
Mark also called Johnson and requested that he not negotiate
the settlement draft. Johnson again responded by letter dated
February 1, 1990, and acknowledged Mark's preference that Johnson
do nothing with the insurance money, but stated that he had put the
money in a trust account.
On that same date, Johnson cashed the check, placed the
proceeds in a trust account, and withdrew $2500 from the account
and placed it in his general account. There was evidence that this
money was used to pay his office expenses. Johnson testified that
he withdrew this money to protect the Eatinger estate by paying its
creditors. However, there was a separate estate account to pay
creditors.
Bank records also indicate that on March 6 and 7, 1990,
Johnson withdrew an additional $7000 to, at least in part, cover
two checks he wrote to himself from his general office account.
Without these withdrawals, bank records show that there would have
been insufficient funds in Johnson's account to cover checks he had
4 written. Later records establish that Johnson withdrew $2,851.53
earned as interest on the amount remaining in the trust account.
The plaintiffs did not consent to Johnson's disposition of the settlement proceeds. In February 1990, they hired Tim O'Hare to
represent them in the probate proceeding. O'Hare testified that he
called Johnson and demanded the settlement money in February, but
that Johnson refused to tender it. Johnson denied these
conversations. O'Hare eventually received the funds, but Johnson
asserted a lien on $10,000 to secure payment of his probate fee,
and did not turn over the interest. Later, the Probate Court
decided Johnson was entitled to $5000 as fees for probate services.
After plaintiffs hired yet another attorney to file suit
against Johnson for conversion, Johnson petitioned the Probate
Court to determine the remainder of his fee. The Probate Court
deferred to the District Court as the proper forum for resolution
of the conversion claim and the related attorney fee issue. The
case was tried twice; both times a mistrial resulted. Before the
third trial, Johnson moved for summary judgment and his motion was denied.
Johnson's testified that he believed he was entitled to a fee
from the settlement proceeds. He claimed that he also had a right to assert control over additional money because he had an attorney's lien against the settlement to pay for his probate
services. Johnson claims that the plaintiffs disputed the appropriate use of the settlement money and, perceiving a conflict,
he decided to put the money in a trust account. He claims that he
5 then withdrew from the probate proceeding because he was also a
creditor of the estate. The jury did not accept Johnson's defenses
and rendered a verdict in favor of the plaintiffs. The jury also awarded plaintiffs compensatory damages, punitive damages, and
costs.
ISSUE 1
Did the District Court err when it denied Johnson's motion for
summary judgment?
Our standard of review of a district court's summary judgment
ruling is identical to the trial court's. Cooper v. Sisters of Charity
(1994) I 875 P.2d 352, 353, 51 St. Rep. 484, 485. We, therefore,
review a summary judgment decision denovo and summary judgment is
only proper when there are no genuine issues of material fact and
the moving party is entitled to judgment as a matter of law.
Rule 56(c), M.R.Civ.P; Spain-Morrow Ranch, Inc. v. West (19941, 264 Mont.
441, 444, 872 P.2d 330, 331-32.
We have recognized that a claim for conversion must satisfy
the following elements: ownership of property, a right of
possession, unauthorized dominion over that property by another,
and damages that result. Lanev. Dunkle (1988), 231 Mont. 365, 368,
753 P.2d 321, 323.
Johnson argues that the pleadings and supporting documents establish that he had a right to the money he retained, based on
the parties' agreement and the fact that he settled the case
pursuant to their request. He also contends that the plaintiffs
6 could not establish the elements of ownership and damage essential
to a claim for conversion. We conclude that his arguments are
without merit. Ownership of proceeds from settlement of wrongful death or
survival claims belongs to the heirs or the estate respectively.
Swansonv. ChampionIntl. Corp. (1982), 197 Mont. 509, 515-18, 646 P.2d
1166, 1169-71. The $95,000 settlement draft in this case was paid
to settle claims against the insured driver in exchange for his
release from claims for wrongful death and personal injury. The
draft was made payable to the Eatinger estate, and to Robert
Johnson as the attorney. However, plaintiffs offered evidence that
there was no agreement to pay Johnson any fee from these proceeds.
The plaintiffs claim that the money, therefore, belonged to them or
the estate, not Robert Johnson. Likewise, the plaintiffs claim
that they, not Johnson, are entitled to the interest that accrued
on the settlement proceeds. See 45 Am. Jur. 2d Interest and Usury § 39
(1969). The plaintiffs introduced sufficient evidence in support
of their claims to create a factual issue regarding ownership.
Therefore, summary judgment for Johnson was correctly denied.
Second, Johnson argues that the Eatinger estate suffered no
damage because it ultimately received the amount to which, in
retrospect, it was entitled. The plaintiffs contend that the fact
that Johnson withdrew funds without consent is sufficient to
establish damages. We agree with the plaintiffs. Johnson withdrew $9500 in February and March 1990, and interest in the amount of $2853.51 in October 1990.
Sections 27-l-201 and -202, MCA, provide that detriment is a
loss suffered in person or property and that everyone who suffers detriment from another's wrongful acts is entitled to damages.
Further, 5 27-l-320, MCA, provides, in relevant part, that
detriment caused by the wrongful conversion of personal property is
presumed to be the value of the property at the time of conversion,
plus interest from that time and a fair compensation for the time
and money expended to pursue recovery of the property. Therefore,
in conversion claims, damages are presumed once the other elements
are established.
Johnson also claims that plaintiffs had no right to the
settlement proceeds because they had not yet signed release
agreements. However, this argument ignores the facts in this case.
The check was made payable to Ruth Eatinger's estate. The heirs of
the estate and its personal representative told Johnson not to cash
the check. Nonetheless, Johnson cashed the check and deposited the
proceeds in a trust account. He then withdrew money from that
account. If an executed release was a prerequisite to use of the
settlement proceeds, certainly Johnson was no more entitled to its
use than the heirs. Furthermore, we have previously recognized
that signing a release is not necessary where parties indicate an
intent to settle a claim and the check endorsed states that it is
for a full and final settlement. SeeBoyerv.Ettelman (1989), 235 Mont.
323, 327-28, 767 F.2d 324, 327.
8 The plaintiffs' intent was to settle their claims for
95 percent of the policy limits, which they understood was $95,000.
That purpose was accomplished when the settlement draft was
tendered and Mark Eatinger endorsed it. The draft stated that it
was for a full and final settlement. The fact that a release was
not signed until later is irrelevant to the facts of this case.
For these reasons, Johnson was not entitled to judgment as a
matter of law, and the District Court did not err when it denied
his motion for summary judgment. ISSUE 2
Did the District Court abuse its d.iscretion when it refused to
delay trial of the conversion claim unt il the Probate Court decided
the amount of Johnson's fee? Our standard of review of a district court order related to
trial administration is whether the district court abused its
discretion. MontanaRailLinkv. Byard (1993), 260 Mont. 331, 337, 860
P.2d 121, 125. Johnson requested that the District Court stay
proceedings in the conversion claim pending a final determination
by the Probate Court regarding attorney fees.
The Probate Court had jurisdiction over and decided the amount
of Johnson's fees for probate of the Eatinger estate. The Probate
Court Judge testified at trial that that court did not have
jurisdiction to decide the attorney fee related to the tort claim.
In an order entered November 30, 1994, which we judicially notice, the Probate Court noted that Johnson himself previously argued that
the Probate Court lacked jurisdiction over the tort claim fee
9 dispute. That court also decided that Johnson was estopped from asserting a contrary position in the probate proceedings. We
conclude that the District Court did not abuse its discretion when
it refused to stay proceedings in this case.
ISSUE 3
Did the District Court err when it did not instruct the jury
that an attorney has a right to retain possession of a client's
money until he or she is paid for services rendered?
On appeal, we review jury instructions as a whole and in light
of the evidence presented at trial. Pipe Indus. Ins. Fund v. Consolidated Pipe
TradesTrust (1988), 233 Mont. 162, 166, 760 P.2d 711, 715.
Johnson argues that the focal point of his defense was that he
had asserted an attorney's retaining lien, and that even though the
only instruction he offered related to an attorney's charging lien
authorized by 5 37-61-420, MCA, the District Court erred by giving
the charging lien instruction instead of a retaining lien
instruction.
Rule 51, M.R.Civ.P., states, in relevant part, that "[nlo
party may assign as error the failure to instruct on any point of
law unless that party offers an instruction thereon." We have held
that a party is barred from challenging on appeal a court's refusal to give an instruction if the party fails to object to the
instruction when it is given. &eStutev.Smith (1986), 220 Mont. 364,
381-82, 715 P.2d 1301, 1311. This rule is particularly appropriate
10 under these circumstances where the party challenging the
instruction is the party who offered it.
When Johnson proposed the charging lien instruction, his
counsel stated that he thought the language was broad enough to
cover Johnson's defense. We will not allow Johnson to benefit from
an alleged error he created. We conclude that the District Court
did not abuse its discretion when it did not instruct the jury
regarding an attorney's retaining lien.
ISSUE 4 Did the District Court abuse its discretion when it refused to
grant Johnson's motion for a directed verdict?
A motion for a directed verdict should be granted only if no
evidence warrants submission to the jury, and all factual
inferences are viewed in a light most favorable to the party
opposing the motion. Moralli v. Lake County (1992), 255 Mont. 23, 27,
839 P.2d 1287, 1289. We affirm the District Court's denial of Johnson's motion for a directed verdict for the same reason we
affirmed denial of his motion for summary judgment.
The judgment of the District Court is affirmed.
We concur: