Lutrell v. Rosales Law Group, P.C.

CourtNew Mexico Court of Appeals
DecidedJune 5, 2018
DocketA-1-CA-35047
StatusUnpublished

This text of Lutrell v. Rosales Law Group, P.C. (Lutrell v. Rosales Law Group, P.C.) 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
Lutrell v. Rosales Law Group, P.C., (N.M. Ct. App. 2018).

Opinion

This memorandum opinion was not selected for publication in the New Mexico Appellate Reports. Please see Rule 12-405 NMRA for restrictions on the citation of unpublished memorandum opinions. Please also note that this electronic memorandum opinion may contain computer-generated errors or other deviations from the official paper version filed by the Court of Appeals and does not include the filing date.

1 IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

2 CHRIS LUTTRELL and 3 DAWN DAVIDE LUTTRELL,

4 Plaintiffs-Appellants,

5 v. NO. A-1-CA-35047

6 ROSALES LAW GROUP, P.C.,

7 Defendant-Appellee,

8 and

9 AMERICAN NATIONAL PROPERTY 10 AND CASUALTY COMPANY,

11 Defendant.

12 APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY 13 Alan M. Malott, District Judge

14 Mescall Law Firm, P.C. 15 Thomas J. Mescall, II 16 Phillip Patrick Baca 17 Albuquerque, NM

18 for Appellants

19 APNLAW, LLC 20 Amelia P. Nelson 1 Albuquerque, NM

2 for Appellee

3 MEMORANDUM OPINION

4 VIGIL, Judge.

5 {1} This case comes to us on appeal from the district court’s order dismissing

6 Plaintiffs Chris and Dawn Luttrell’s action for damages and specific performance

7 against Defendant Rosales Law Group, P.C. For the reasons that follow, we hold that

8 the district court erred in granting Defendant’s motion, and we reverse and remand for

9 further proceedings. Because this is a memorandum opinion and the parties are

10 familiar with the facts and procedural posture of the case, we set forth only such facts

11 and law as are necessary to decide the merits.

12 BACKGROUND

13 {2} Plaintiffs’ pickup truck was stolen on March 6, 2015. At the time the pickup

14 was stolen, Plaintiffs were insured by American National Property and Casualty

15 Company (Insurer) against vehicle theft. Plaintiffs filed an insurance claim for the

16 theft of their pickup with Insurer on March 6, 2015.

17 {3} On April 21, 2015, Plaintiffs received notification in writing that their “claim

18 file has been reassigned for further investigation.” Defendant was under contract to

19 conduct claims investigations for Insurer, but may have had additional duties and

2 1 responsibilities. On May 14, 2015, and as part of Insurer’s claims process, Defendant,

2 by and through one of its attorneys, David Ray Rosales, sent Plaintiffs a letter

3 requesting that Plaintiffs produce numerous financial, business, and tax records, as

4 well as submit to examinations under oath (EUOs). On June 26, 2014, Plaintiffs

5 requested in writing that Insurer and Defendant promptly provide them with an

6 explanation as to why their claim had not been paid. Plaintiffs submitted to EUOs

7 taken by attorney Rosales.

8 {4} At the EUO of Chris Luttrell, attorney Rosales stated that:

9 to be clear, this is not a deposition. It is not intended to be, by design, an 10 adversarial process. You are here under contract, and it is an inquiry 11 made by your carrier that ultimately should serve to benefit both parties; 12 namely, the insurance company and yourself. I’m the face of the 13 insurance company. You have an obligation under the contract to 14 substantiate [your] claim, and that’s what it is.

15 {5} As of July16, 2015, the record indicates that Insurer had not (1) recognized or

16 denied any insurance coverage for Plaintiffs’ claim; or (2) paid or made any offer to

17 pay the claim. Neither does the record indicate that Insurer had initiated adversarial

18 proceedings against Plaintiffs in relation to their claim. As a result, seeking damages

19 and an order requiring Insurer to determine whether their claim would be indemnified,

20 Plaintiffs filed suit against Insurer and Defendant, alleging six counts pertaining to the

21 handling of their claim: (1) breach of fiduciary duty; (2) breach of the covenant of

22 good faith and fair dealing; (3) breach of contract; (4) violation of the Trade Practices

3 1 and Fraud Article of the Insurance Code; (5) violation of the Unfair Practices Act; and

2 (6) constructive fraud.

3 {6} Defendant responded by filing a motion to dismiss Plaintiffs’ action under Rule

4 1-012(B)(6) NMRA. Defendant argued that Plaintiffs’ action arose from a “calculated

5 misuse of the legal process to frustrate and interfere with the rights and obligations

6 between Plaintiffs and [Insurer under their insurance contract], as well as to obstruct

7 [Insurer]’s due process right to competent counsel.” Specifically, Defendant

8 contended that Plaintiffs’ action should be dismissed because based on the attorney-

9 client status of Insurer and Defendant’s relationship, Defendant owed no fiduciary

10 duties to Insurer’s adversary—Plaintiffs—and that as an attorney, David Ray Rosales

11 was not subject to liability to Plaintiffs under the Insurance Code or the Unfair

12 Practices Act, and that Plaintiffs’ lawsuit violated public policy by interfering with

13 Insurer’s right to counsel.

14 {7} In support of its motion, Defendant attached a demand letter dated July 22,

15 2015, from counsel for Defendant to Plaintiffs, in which counsel requested that

16 Plaintiffs seek dismissal of their lawsuit against Insurer and Defendant, otherwise

17 Defendant would file a motion to dismiss and seek statutory attorney’s fees. The letter

18 further stated that Defendant could not be liable in Plaintiffs’ lawsuit since attorney

19 Rosales was functioning as Insurer’s legal counsel during its work in the handling of

4 1 Plaintiffs’ claim. Defendant also attached the affidavit of attorney Rosales, in which

2 attorney Rosales stated that he and Defendant had been retained by Insurer to

3 represent Insurer as counsel with regard to Plaintiffs’ insurance claim. “My role in

4 representing [Insurer,]” attorney Rosales continued, “was undertaken strictly in my

5 capacity as attorney for [Insurer] and not as an investigator, adjuster, or claim

6 representative. As counsel, I reported to the adjuster assigned to” Plaintiffs’ claim.

7 Defendant also stated in its motion that Insurer had retained Defendant as counsel to

8 conduct Insurer’s investigation into Plaintiffs’ insurance claim, to take the EUOs of

9 Plaintiffs, and to provide Insurer with legal advice.

10 {8} Recognizing that Defendant’s attachment of materials outside the pleadings

11 turned its motion to dismiss into a motion for summary judgment, Plaintiffs argued

12 that a dispute as to material issues of fact in the case existed, including as to whether

13 Defendant was or was not acting as counsel for Insurer in an adversarial proceeding

14 during the course of Insurer’s handling of Plaintiffs’ claim. See Rule 1-012(B) (“If,

15 on a motion asserting the defense [under Rule 1-012(B)(6)] to dismiss for failure of

16 the pleading to state a claim upon which relief can be granted, matters outside the

17 pleading are presented to and not excluded by the court, the motion shall be treated

18 as one for summary judgment and disposed of as provided in Rule 1-056 NMRA[.]”).

19 Specifically, Plaintiffs contended that this dispute of material fact stemmed from the

5 1 inconsistency between: (1) attorney Rosales’ statements to Plaintiff Chris Luttrell

2 during the taking of his EUO, that attorney Rosales served as the “face” of Insurer in

3 its handling of Plaintiffs’ claim, and that the EUO was “not intended to be, by design,

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Lutrell v. Rosales Law Group, P.C., Counsel Stack Legal Research, https://law.counselstack.com/opinion/lutrell-v-rosales-law-group-pc-nmctapp-2018.