Edwards v. DUNLOP-GATES

344 S.W.3d 424, 2011 WL 1591492
CourtCourt of Appeals of Texas
DecidedJune 15, 2011
Docket08-09-00040-CV
StatusPublished
Cited by3 cases

This text of 344 S.W.3d 424 (Edwards v. DUNLOP-GATES) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Edwards v. DUNLOP-GATES, 344 S.W.3d 424, 2011 WL 1591492 (Tex. Ct. App. 2011).

Opinion

OPINION

ANN CRAWFORD McCLURE, Justice.

William Rowland Edwards, Jr. appeals from a summary judgment entered in favor of the defendants in this legal malpractice action. For the reasons that follow, we reverse and remand for a trial on the merits.

FACTUAL BACKGROUND

Edwards filed suit against Pamela Dun-lop-Gates, Gerrit M. Pronske, and Thompson, Coe, Cousins, & Irons, LLP alleging claims of legal malpractice. Because the facts which give rise to Edwards claims are entangled and somewhat complex, it is necessary to provide a more detailed summary. A review of the record in the light most favorable to Edwards discloses the following facts.

In April 1999, Edwards became a creditor in a bankruptcy proceeding involving Dr. William Scott Blessing, his wife Lisa, and his professional medical association (MDPA). Edwards filed a proof of claim seeking payment of debts from a series of financial dealings. At that time, Lionel Smith served as an officer and director of Medifund Management Corp. (Management), a company that provided billing services for doctors. He also served as president and one of three stockholders in Medifund Financial Corp. (Financial). According to Edwards’ pleadings, Smith was also, “a key person involved in all aspects” of MDPA’s financial affairs. MDPA was a client of Medifund Management.

Financial loaned money to MDPA and later placed a lien on its accounts receivable. When Smith wanted to refinance the debt in December 1998, he approached Edwards with a business proposition by which Edwards would acquire Financial’s loan to MDPA. By April 1999, the Blessings and MDPA had defaulted and Edwards made demand for payment. When the Blessings and MDPA filed for bankruptcy, they also filed an adversary proceeding naming Edwards as defendant.

The Adversary Proceeding, The Smith Suit & The Settlement Agreement

Edwards hired Pronske, a bankruptcy specialist with the firm of Thompson Coe, to represent him in the adversary proceeding. The Blessings alleged claims against Edwards for fraud, breach of fiduciary duty, and breach of contract. Without Edwards’ consent and despite repeated complaints, Pronske delegated a substantial amount of the case load to Gates. Despite many assurances to the contrary, only Gates appeared on Edwards’ behalf at the hearing.

During this same time period, Edwards was engaged in litigation with Lionel Smith, whom he claimed defrauded him into entering business dealings with the Blessings and the Medifund entities. According to Edwards’ pleadings, Smith made numerous material misrepresentations regarding the personal and professional financial condition of the Blessings and MDPA which induced him to enter the agreement. In this lawsuit, Edwards was represented by Marshall Searcy, an attorney with the firm of Kelly, Hart, & Hall-man, PC.

*427 At a hearing in the adversary proceeding on August 30, 2000, the parties announced a settlement. In addition to an agreement between Edwards and the Debtors, Smith’s attorney announced that Smith would also be a party to the settlement. The terms were then read into the record. 1 The adversary proceeding was administratively closed on September 7, 2000. The Smith litigation was then dismissed by Searcy and Smith’s counsel according to an agreed order of dismissal dated October 24, 2000.

The First Trust Suit

About a year after the settlement, a group of creditors who were successors in interest to the Financial note 2 demanded Edwards pay the debt, contending that the settlement reached in the adversary proceeding did not release Financial’s claims against Edwards. On October 17, 2001, the Moon Brothers sued Edwards claiming breach of a commercial financing agreement. First Trust Corp. TTEE FBO v. Edwards, 172 S.W.3d 230, 232 (Tex.App.-Dallas 2005, pet. denied). Edwards was represented in the First Trust Suit by Searcy. It is undisputed that Thompson Coe was not involved in his defense. 3 Edwards initially prevailed, but the Dallas Court of Appeals reversed and remanded, ruling in part that Edwards received a release from Smith individually but not from Medifund Financial. First Trust, 172 S.W.3d at 232. The court then concluded that:

[o]n this record, as to the first issue, the settlement agreement in question does not, as a matter of law, release and discharge Edwards from the claims of MFC on which First Trust brings suit .... as to the second issue, that [sic] there is no evidence establishing that MFC authorized anyone to grant a release of its claims against Edwards.

First Trust, 172 S.W.3d at 232. During the re-trial, Edwards elected to settle the suit.

The Current Malpractice Suit & Summary Judgment

On September 21, 2004, Edwards filed this suit alleging claims of legal malpractice. His pleadings alleged negligence on behalf of Thompson Coe in: (1) failing to obtain a valid release of the Financial debt obligations owed by Edwards and/or failing to inform Edwards that a valid release was not possible; (2) negligent supervision by Pronske; (3) violations of the Deceptive Trade Practices Act by Thompson Coe and Pronske; and (4) breach of fiduciary duty as to Pronske. All that remains are the negligence claims. 4

*428 On October 2, 2008, Appellees filed both traditional and no-evidence motions for summary judgment. The traditional motion alleged that all claims were barred by the applicable statutes of limitations. The trial court granted summary judgment and this appeal ensues. In two issues, Edwards attacks the validity of the summary judgment.

STANDARD OF REVIEW

The purpose of summary judgment is to permit a trial court to promptly dispose of unmeritorious claims or untenable defenses. City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671, 678 n. 5 (Tex.1979). Summary judgment is proper if the defendant disproves at least one element of the plaintiffs claims, or, alternatively, conclusively establishes each element of an affirmative defense. Velsicol Chemical Corp. v. Winograd, 956 S.W.2d 529, 530 (Tex.1997).

We review the grant or denial of a traditional motion for summary judgment de novo 5 Valence Operating Company v. Dorsett, 164 S.W.3d 656, 661 (Tex.2005); Texas Integrated Conveyor Systems, Inc. v. Innovative Conveyor Concepts, Inc., 300 S.W.3d 348, 365 (Tex.App.-Dallas 2009, pet. denied); Garner v. Fidelity Bank, N.A.,

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Cite This Page — Counsel Stack

Bluebook (online)
344 S.W.3d 424, 2011 WL 1591492, Counsel Stack Legal Research, https://law.counselstack.com/opinion/edwards-v-dunlop-gates-texapp-2011.