Knutson v. Foster

236 Cal. Rptr. 3d 473, 25 Cal. App. 5th 1075
CourtCalifornia Court of Appeal, 5th District
DecidedAugust 8, 2018
DocketG054247
StatusPublished
Cited by17 cases

This text of 236 Cal. Rptr. 3d 473 (Knutson v. Foster) is published on Counsel Stack Legal Research, covering California Court of Appeal, 5th District primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Knutson v. Foster, 236 Cal. Rptr. 3d 473, 25 Cal. App. 5th 1075 (Cal. Ct. App. 2018).

Opinion

FYBEL, J.

*1078INTRODUCTION

After a three-week trial, the jury found in favor of Dagny Knutson on her fraudulent concealment and intentional breach of fiduciary duty claims against her former attorney, Richard J. Foster, and awarded her economic and noneconomic damages. The trial court granted Foster's motion for a new trial on the grounds that Knutson did not prove Foster's conduct was the cause of Knutson's damages and that Knutson had failed to offer substantial evidence of her emotional distress damages.

We reverse and reinstate the jury's verdict because the motion for a new trial was granted on erroneous legal theories. We partially publish this opinion for two reasons. First, we hold that claims of fraudulent concealment and intentional breach of fiduciary duty by a client against his or her attorney are subject to the substantial factor causation standard, not the "but for" or *1079"trial within a trial" causation standard employed in cases of legal malpractice based on negligence. The fact that an attorney-client relationship existed between the plaintiff and the defendant does not change the method by which the plaintiff must establish causation in cases of intentional torts.

Second, we hold that in a case such as this, where the plaintiff's emotional distress consisted of anxiety, shame, a sense of betrayal, and a continuing impact on personal relationships, the testimony of the plaintiff alone is sufficient to support emotional distress damages. Knutson's testimony that the contract negotiated by Foster, and which he encouraged her to enter, led to stress and extra pressure that made swimming an emotionally painful activity, that she felt shamed and betrayed when she learned about Foster's duplicitousness, and that her personal relationships have been impacted due to her lack of trust in others, was sufficient to establish her damages in the absence of any expert testimony.

STATEMENT OF FACTS

A.

KNUTSON, A RISING SWIMMING STAR, ENTERS AN ORAL AGREEMENT WITH USA SWIMMING'S HEAD COACH.

As a high school student in North Dakota, Knutson was an internationally ranked swimmer. She was named high school swimmer of the year by Swimming World Magazine in her junior and senior years of high school. As a high school junior, she broke the American record in the 400-meter individual medley. She was ranked 16th in the world in the 200-meter freestyle, and 22nd in the world in both the 400-meter freestyle and the 200-meter individual medley.

In her senior year of high school (2009-2010), Knutson received scholarship offers *476from many universities with top swimming programs. All offered five-year packages without any type of performance markers. She committed to Auburn University because one of its coaches, Paul Yetter, was considered an expert in the individual medley, Knutson's specialty event.

In March 2010, Mark Schubert, USA Swimming's head coach, told Knutson that Yetter was leaving Auburn University. Schubert advised Knutson to swim professionally rather than at Auburn or another university. He orally promised her support to train at a "Center for Excellence" formed by USA Swimming in Fullerton, California, including room, board, tuition, and a stipend until she earned her degree. Knutson, her parents, and her coaches were present when Schubert made this offer; all of them agreed Schubert's offer did not include *1080any performance markers, was not subject to Schubert's evaluation, and was to last through 2016, after the Rio de Janeiro Olympic Games. The agreement was entirely oral; no written agreement was made between Knutson and USA Swimming or Schubert at that time. Knutson ultimately accepted Schubert's offer and moved to Fullerton.

At Schubert's suggestion, Knutson retained Evan Morgenstein, through his company Premier Management Group LLC (PMG), to be her sports agent. She turned professional, accepted prize money, and signed an endorsement agreement with Mutual of Omaha. Morgenstein's standard athlete representation agreement was signed by Knutson's mother, but never by Knutson herself.

B.

KNUTSON RETAINS ATTORNEY FOSTER WHEN USA SWIMMING REFUSES TO HONOR THE ORAL AGREEMENT .

A few months after Knutson moved to Fullerton, Schubert's employment was terminated by USA Swimming. Schubert told Knutson not to worry, and assured her that USA Swimming would keep the promises he had made to her. However, Knutson became concerned because she was not receiving any money from USA Swimming.

At Morgenstein's suggestion, Knutson retained attorney Richard Foster to represent her in an attempt to get USA Swimming to honor the oral agreement made by Schubert. Foster was well-connected within the swimming world. At the time he represented Knutson, Foster was on the water polo technical committee for the Fédération Internationale de Natation (FINA), the international governing body for swimming, diving, water polo, and synchronized swimming. Foster had been president of the governing body for United States Aquatic Sports (USAS) from 2006 through 2010. (USAS is the umbrella agency that interacts with FINA on behalf of aquatic sports organizations in the United States, including USA Swimming.) Foster was the past-president of USA Water Polo, and had been the chairperson of the organizing committee for the 2004 U.S. Olympic swim trials. Foster was the vice-president and an executive council member for the Swimming Union of the Americas (ASUA), a continental aquatics association, from 2003 to 2007.

At the time he represented Knutson, Foster considered himself to be a high-level person within the aquatics industry and had on-going relationships with and access to many leaders at USA Swimming. Foster did not disclose *1081to Knutson these close personal ties, or that he had long-time relationships with FINA, USA Swimming, and other swimming organizations.

Foster had represented Schubert in 2006 in reviewing Schubert's contract as USA Swimming's head coach. When USA

*477Swimming fired Schubert in 2010, Foster refused to represent him in a wrongful termination lawsuit against USA Swimming because he did not want to have a negative relationship with USA Swimming in the future. Foster told Schubert at that time that he would have a conflict of interest in suing USA Swimming. Knutson testified that Foster never told her that he represented Schubert in 2006, or that he declined to represent Schubert against USA Swimming because he felt there was a conflict of interest due to his relationships with people within USA Swimming. For his part, Foster testified he told both Knutson and Morgenstein that if Knutson could not settle the dispute with USA Swimming, Foster would help her find another attorney to bring a lawsuit on her behalf.

Had Knutson known that Foster had previously represented Schubert, or had she known of Foster's personal and professional relationships with USA Swimming, she would not have agreed to let him represent her "[b]ecause he has both sides' interest at heart, not just mine."

C.

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Bluebook (online)
236 Cal. Rptr. 3d 473, 25 Cal. App. 5th 1075, Counsel Stack Legal Research, https://law.counselstack.com/opinion/knutson-v-foster-calctapp5d-2018.