McLaughlin v. Martin

940 S.W.2d 261, 1997 Tex. App. LEXIS 392, 1997 WL 33867
CourtCourt of Appeals of Texas
DecidedJanuary 30, 1997
Docket14-95-00755-CV
StatusPublished
Cited by3 cases

This text of 940 S.W.2d 261 (McLaughlin v. Martin) 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
McLaughlin v. Martin, 940 S.W.2d 261, 1997 Tex. App. LEXIS 392, 1997 WL 33867 (Tex. Ct. App. 1997).

Opinion

OPINION

HUDSON, Justice.

This is an appeal from a summary judgment disposing of a legal malpractice claim. In a single point of error, appellant contends the trial court erred in granting the motion for summary judgment. We affirm the judgment of the trial court.

In 1985, the appellant, Michael A. McLaughlin, purchased two tracts of land, totaling some 9 acres, from Cinco Venture. The promissory notes and deeds of trust covering these properties were later transferred to American General Realty Investment Corporation. In 1989, after McLaughlin had allegedly defaulted on the notes, American General retained the appellee, Aubrey Dickson Martin, Jr., to initiate and pursue foreclosure proceedings against McLaughlin’s property. 1 The deed of trust liens were foreclosed and the property was sold at a foreclosure sale in 1990.

On July 27,1990, McLaughlin sued American General and Martin for breach of contract, breach of fiduciary duty, fraud, usury, conspiracy, and wrongful foreclosure. Martin was non-suited on the day of trial, and McLaughlin’s suit against American General ended in a mistrial. The trial court later granted a partial summary judgment on the foreclosure claims in favor of American General. The parties settled the remaining issues in mediation. As part of the settlement, American General assigned McLaughlin any legal malpractice claims it might have against Martin.

In May of 1994, McLaughlin sued Martin on the assigned cause of action for alleged failures and omissions in his legal representation of American General. Martin moved for summary judgment on two grounds: (1) that American General’s assignment of the legal malpractice claim was invalid; and (2) that collateral estoppel bars the claim. The trial court granted Martin’s motion.

In his sole point of error, McLaughlin complains the trial court erred in granting Martin’s motion for summary judgment. To prevail on a motion for summary judgment, the movant must show that no genuine issue of material fact exists and that he is entitled to judgment as a matter of law. Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548 (Tex.1985). When, as here, the summary judgment order does not specify the ground or grounds on which it is based, we will uphold the order on any ground asserted by the movant that is meritorious. Rogers v. Ricane Enters. Inc., 772 S.W.2d 76, 79 (Tex.1989).

McLaughlin argues that the trial court erred in granting summary judgment based on precedent shaped largely by public policy concerns. See Zuniga v. Groce, Locke & Hebdon, 878 S.W.2d 313, 316-18 (Tex.App.—San Antonio 1994, writ ref'd). In Zuniga, *263 the San Antonio Court of Appeals found that the integrity of the legal profession and the attorney-client relationship would be severely undermined by recognizing the assignability of legal malpractice claims. Id. at 318. The court reasoned that if a “judgment-proof’ defendant could assign to the plaintiff a malpractice claim against his own lawyer, the plaintiff might be tempted to replace the under-capitalized defendant with a more solvent target — the defendant’s attorney. Id. at 317-18. We agree.

The assignability of a legal malpractice claim would convert it into a commodity to be exploited and transferred to economic bidders to whom the attorney never owed a legal duty. Zuniga, 878 S.W.2d at 316 n. 4. This could result in an embarrassing reversal of positions where a successful plaintiff might argue that the defendant suffered judgment not because of the strength of plaintiffs claims, but because of defense counsel’s negligence. Id. at 317; see also State Farm Fire & Casualty Co. v. Gandy, 925 S.W.2d 696, 708 (Tex.1996). This possibility would inevitably impair an attorney’s duty of loyalty and trust to his client. Attorneys would be placed in the awkward position of, on one hand, zealously protecting all of his client’s rights and, on the other, facing concerns that his client might consider assigning a malpractice claim against him to settle the case or satisfy a debt to a third party. City of Garland v. Booth, 895 S.W.2d 766, 770 (Tex.App.—Dallas 1995, writ denied). The assign-ability of malpractice claims could eventually make lawyers reluctant to represent underin-sured or insolvent clients for fear of becoming the most attractive target in the lawsuit. Zuniga, 878 S.W.2d at 317-18.

McLaughlin attempts to distinguish this case from Zuniga and State Farm because he has not engaged in an “abrupt and shameless shift of positions,” but has remained constant in his posture regarding Martin. See State Farm, 925 S.W.2d at 708. Initially, the Zuniga and State Farm plaintiffs strongly advocated the merits of their own cases. Following assignment of defendants’ malpractice claims, however, plaintiffs took the contradictory position that defendants would have prevailed but for the negligence of defense counsel. Here, however, appellant depicts Martin as a participant in the underlying transaction. He was a named co-defendant from the outset, and McLaughlin contends it was Martin’s alleged misconduct and malpractice that resulted in American General’s foreclosure on appellant’s property.

Despite appellant’s arguments to the contrary, 2 we find the policy considerations raised in Zuniga and City of Garland justify barring the assignment here. Zuniga warned of the commercial aspect of the assignability of legal malpractice claims, describing it as “rife with probabilities that could only debase the legal profession.” Zuniga, 878 S.W.2d at 316 n. 4 (quoting Goodley v. Wank & Wank, Inc., 62 Cal.App.3d 389, 397, 133 Cal.Rptr. 83, 87 (1976)). The result envisioned was a lucrative business of factoring malpractice claims that would encourage unjustified lawsuits against members of the bar, generate an increase in malpractice litigation, promote champerty, and force attorneys to defend themselves against strangers. Id. Despite appellant’s criticism that this conclusion is an irrational musing and pure speculation unsupported by the facts, it is not this Court’s place to ignore principles of law tacitly approved by our state’s Supreme Court. 3

Finally, we believe that regardless of a client’s resources and despite the absence of *264 any perceived fraud or collusion, the mere threat of malpractice claim marketing will always loom large in the mind of any attorney.

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Bluebook (online)
940 S.W.2d 261, 1997 Tex. App. LEXIS 392, 1997 WL 33867, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mclaughlin-v-martin-texapp-1997.