Pete v. Anderson

413 S.W.3d 291, 2013 WL 6145149, 2013 Ky. LEXIS 588

• Court: Kentucky Supreme Court
• Decided: November 21, 2013
• Docket: No. 2011-SC-000692-DG
• Status: Published

Opinions

Opinion of the Court by

Justice ABRAMSON.

Michael Anderson, Jr. and Malik Anderson filed a professional negligence action against attorney Mickiel Pete, the law firm of Cochran, Cherry, Givens, Smith, Sistrunk 85 Sams, P.C., and attorney Dennis Burke (collectively “Pete”), claiming the attorneys were negligent in executing their professional duties following the death of the Andersons’ father. The Jefferson Circuit Court granted Pete’s motion for summary judgment on the grounds that Michael, Jr. and Malik, minors at the time of their father’s death, lacked standing to sue for professional negligence because they did not have an attorney-client relationship with Pete. The Court of Appeals reversed, holding that summary judgment was inappropriate because there was a genuine issue of material fact as to the existence of the alleged attorney-client relationship. The Court of Appeals further held that, in any event, Pete owed professional duties to Michael, Jr. and Malik, who were statutorily-identified beneficiaries of the underlying wrongful death claim. For the reasons discussed fully herein, we affirm.

RELEVANT FACTS

On October 17, 2001, Michael Anderson was killed when the van that he was driving struck a retaining wall, partially ejecting Anderson from the vehicle. The van, which was owned by Anderson’s employer, was equipped with a pedestal-style driver’s seat with a locking mechanism that allowed the operator to position the seat. This mechanism was apparently malfunctioning on the day of the fatal accident.

Anderson was survived by his wife Elizabeth and four children, including two minor sons, Michael, Jr. and Malik. Attorney Mickiel Pete was retained to pursue an action against Dixie Warehouse Services, LLC (“Dixie”), the company charged with maintaining the van involved in Anderson’s accident. Pete filed a wrongful death claim, naming Elizabeth as personal representative of Anderson’s estate (“the estate”), and also filed a loss of consortium claim on Elizabeth’s behalf, but did not file a loss of parental consortium claim on behalf of Anderson’s children. The Jefferson Circuit Court eventually dismissed the suit after Dixie successfully excluded two of the plaintiffs’ expert witnesses on Daubert grounds, leaving no evidence of a causal connection between Dixie’s conduct and Anderson’s death.¹ Pete did not appeal the trial court’s decision.²

Two years later, Malik, by and through Elizabeth, and Michael, Jr., now of the age of majority, filed a professional negligence action against Pete alleging negligence, gross negligence and breach of fiduciary duty, as well as negligent or fraudulent misrepresentations. Pete moved for summary judgment arguing that there was no attorney-client relationship between Pete and the children, and that any other claims of the estate were barred by the statute of limitations. The trial court granted Pete’s motion, finding that Michael, Jr. and Malik were not in privity with Pete, and thus lacked standing to sue for professional negligence.

In a unanimous decision reversing the trial court, the Court of Appeals found that there was a material factual issue in dispute, namely, whether Malik and Michael, Jr. were actually represented by Pete, or were led to believe that they were being represented by him. In addition to finding that summary judgment was premature, the Court of Appeals held that even if there was no privity, the children were owed professional duties because they were the intended beneficiaries of the underlying wrongful death action. We accepted discretionary review and now affirm the Court of Appeals.

ANALYSIS

I. The Trial Court Erred in Granting Summary Judgment Because There Are Issues of Material Fact Regarding the Attorney-Client Relationship.

Kentucky Revised Statute (“KRS”) 413.245 provides that an action for professional malpractice “shall be brought within one (1) year from the date of the occurrence or from the date when the cause of action was, or reasonably should have been, discovered by the party injured.” Elizabeth failed to bring a malpractice action against Pete on her own behalf within the one-year statute of limitations. However, KRS 413.245 further provides: “Time shall not commence against a party under legal disability until removal of his disability.” Michael, Jr. and Malik were minors when the alleged malpractice occurred. Therefore, the tolling provision of KRS 413.245 would allow them to timely bring any claim against Pete within one year of achieving the age of majority. Of course, a party may pursue a malpractice action against an attorney only if that party has standing to do so by virtue of being owed professional duties by the attorney. Marrs v. Kelly, 95 S.W.3d 856 (Ky.2003).

Pete argues that the trial court correctly granted summary judgment after determining that Michael, Jr. and Malik, having no attorney-client relationship with Pete, lacked standing to bring the professional malpractice claim. As noted, the Court of Appeals reversed, concluding- that a material fact issue existed regarding whether Pete shared an attorney-client relationship with the two minor Anderson children, therefore rendering summary judgment premature.

The standard of review of a summary judgment is whether the trial court correctly found that there was no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law. Norton Hospitals, Inc. v. Peyton, 381 S.W.3d 286 (Ky.2012). We will uphold a summary judgment only if after viewing the evidence in the light most favorable to the party opposing the motion, we conclude that party “could not prevail under any circumstances.” Steelvest v. Scansteel Service Center, Inc., 807 S.W.2d 476 (Ky.1991). Where, as here, factual findings are not at issue, we review the legal conclusions of the lower courts de novo. Branham v. Stewart, 307 S.W.3d 94 (Ky.2010).

Michael, Jr. and Malik maintain that the trial court ignored a genuine issue of material fact in granting Pete’s motion for summary judgment. They claim that Elizabeth’s affidavit concerning Pete’s legal representation demonstrates that she reasonably believed that Pete was representing not only her own interests, but the interests of her minor children as well. Elizabeth’s affidavit states in part as follows:

7. In or around the summer of 2004, Mr. Pete met with me and my children, Michael and Malik, in person at my home to discuss the loss my children suffered as the result of the death of their father, Mr. Anderson.

8. On several occasions during the course of Defendants’ representation in the Prior Action, Mr. Pete explained to me that a trust fund would be created for the benefit of my children, including Michael and Malik, should there be recovery of money from Dixie Warehouse Services in connection with the Prior Action.

9. Because of the course of my dealings and communications with Defendants, I understood that Defendants were representing me, my children, and my husband’s, Mr. Anderson, estate in the Prior Action.

10. Specifically, I understood that Defendants were representing any claims my children, including Michael and Ma-lik, may have had against Dixie Warehouse Services in the Prior Action.

Pete argues that the Court of Appeals erred because these facts are irrelevant, given that the question of duty is a legal one for the court to decide. However, “[a] plaintiff in a legal malpractice case has the burden of proving 1) that there was an employment relationship with the defendant/attorney; 2) that the attorney neglected his duty to exercise the ordinary care of a reasonably competent attorney acting in the same or similar circumstances; and (3) that the attorney’s negligence was the proximate cause of damage to the client.” Marrs, 95 S.W.3d at 860 (quoting Stephens v. Denison, 64 S.W.3d 297, 298-99 (Ky.App.2001)). The contractual relationship between an attorney and client may be “either expressed or implied by the conduct of the parties.” Daugherty v. Runner, 581 S.W.2d 12, 16 (Ky.App.1978). Indeed, an attorney-client relationship may be created as a result of a party’s “reasonable belief or expectation,” based on the attorney’s conduct, that the attorney has endeavored to undertake representation. Lovell v. Winchester, 941 S.W.2d 466, 468 (Ky.1997); Am. Continental Ins. Co. v. Weber & Rose, P.S.C., 997 S.W.2d 12 (Ky.App.1998). Therefore, whether a party had a “reasonable belief or expectation” relating to the attorney’s representation of that party’s legal interests is a question of fact. See Marrs, 95 S.W.3d 856; Lovell, 941 S.W.2d 466.

In viewing the evidence in the light most favorable to Michael, Jr. and Malik, we may accept the facts presented in their mother’s affidavit as true. Elizabeth testified that she believed “that Defendants were representing any claims my children, including Michael and Malik” had against Dixie.³ Therefore, the reasonableness of Elizabeth’s belief presents a genuine issue of material fact, uncontroverted at the time summary judgment was entered. Without record of a contract, mem-oranda, or other facts establishing the scope of the relationship,⁴ it is plausible that Pete’s conduct left Elizabeth with the reasonable understanding that he would pursue her minor sons’ claims as well as her own. Of course, it may be revealed through discovery on remand that this was not the case, but the factual question of whether Elizabeth held a “reasonable belief or expectation” concerning Pete’s representation precludes summary judgment. Steelvest, Inc., 807 S.W.2d at 480. Consequently, we affirm the Court of Appeals’ reversal and remand of the trial court’s summary judgment ruling on the issue of Pete’s representation of Michael, Jr. and Malik regarding any claims they had arising from their father’s death.

II. The Attorneys Owed Duties to the Children Who Were the Real Parties in Interest to the Wrongful Death Action.

Reversing the trial court on a second ground, the Court of Appeals concluded that because Michael, Jr. and Malik were the statutory beneficiaries of the underlying wrongful death suit, they were owed professional duties by Pete, even in the absence of privity. Pete contends that this conclusion is erroneous because the underlying wrongful death action belonged to the Anderson estate, and not to the surviving family members, meaning any malpractice action arising from the wrongful death claim could only be- brought on behalf of the estate.

It is well settled that an attorney is liable to those parties who are intended to benefit from his or her services “irrespective of any lack of privity.” Hill v. Willmott, 561 S.W.2d 331, 334 (Ky.App.1978); Seigle v. Jasper, 867 S.W.2d 476 (Ky.App.1993). As such, the beneficiaries of a given cause of action have standing to bring a malpractice action against an attorney for his or her breach of professional duties in connection with that action. Hill, 561 S.W.2d at 334. With this principle in mind, we examine the nature of a wrongful death claim in order to determine who is entitled to the benefit of the action, and, in turn,- who has standing to sue the attorney for malpractice.

At common law, no civil cause of action could be maintained for the wrongful death of a person.⁵ The 1891 Kentucky Constitution signaled a departure from this longstanding tradition and authorized a civil right to recover when death- is negligently caused. Section 241 of the Kentucky Constitution, then and now, provides that:

Whenever the death of a person shall result from an injury inflicted by negligence or wrongful act, then, in every such case, damages may be recovered for such death, from the corporations and persons so causing the same. Until otherwise provided by law, the action to recover such damages shall in all cases be prosecuted by the personal representative of the deceased person. The General Assembly may provide how the recovery shall go and to whom belong; and until such provision is made, the same shall form part of the personal estate of the deceased person.

The drafters of Kentucky’s 1891 Constitution contemplated explicitly naming beneficiaries in the text of Section 241 before concluding that distribution under the provision must be statutorily directed. 4 Debates of Constitutional Convention of 1890 (“Debates ”) 4715-4720. Convention delegates debated amending the section ■ to preclude recovery when there are no surviving relativés, or to otherwise include language ensuring that recovery would pass to close relatives of the decedent only. 4 Debates at 4715-16. One such proposed amendment provided that “there shall be no recovery unless there is a wife or child, father or mother, brother or sister of the deceased,” while another inserted the language “heirs-in-law” into the provision. 4 Debates at 4715. Ultimately, the delegates concluded that amending the text' of the section to name the beneficiaries would invade the province of the General Assembly, and invite challenges to the provision. 4 Debates at 4717.

Notably, Great Britain’s Lord Campbell’s Act, passed by Parliament in 1846, provided an early model wrongful death statute for American legislators to follow in the middle and late 1800s. The Act authorized a cause of action when death is “caused by wrongful act, neglect, or default,” and provided that it “shall be for the benefit of the wife, husband, parent, and child of the person whose death shall have been so caused,” and was to be brought “by and in the name of the executor or administrator of the person deceased.” Lord Campbell’s Act (Fatal Accidents Act), 1846, 9 & 10 Vict., ch. 93, §§ 1-2 (Eng.).

Following the passage of Lord Campbell’s Act, many states began enacting wrongful death statutes.⁶ Kentucky enacted two wrongful death statutes prior to the adoption of the 1891 Constitution. The first statute created a cause of action for families of individuals killed in duels, restricting recovery to the widow and any minor children of the deceased. 1851 Ky. Rev.Stat., ch. 31, § 1. A second, more general wrongful death statute allowed recovery for death arising from “the neglect or misconduct of railroad companies and others.” 1854 Ky.Rev.Stat., ch. 964. Action under this version of the statute was vested in the “widow, heir or personal representative of the deceased.” Id; see also Jordan’s Adm’r v. Cincinnati, N.O. & T.P. Ry. Co., 89 Ky. 40, 11 S.W. 1013 (Ky.1889). The statute was later amended following the adoption of Section 241 of the Kentucky Constitution. See Chapter 1, § 6 of the Kentucky Statutes of 1903. Ultimately, the wrongful death statute was compiled as KRS 411.130, which, in its present form, states:

(1) Whenever the death of a person results from an injury inflicted by the negligence or wrongful act of another, damages may be recovered for the death from the person who caused it, or whose agent or servant caused it. If the act was willful or the negligence gross, punitive damages may be recovered. The action shall be prosecuted by the personal representative of the deceased.

(2) The amount recovered, less funeral expenses and the cost of administration and costs of recovery including attorney fees, not included in the recovery from the defendant, shall be for the benefit of and go to the kindred of the deceased in the following order:

(a) If the deceased leaves a widow or husband, and no children or their descendants, then the whole to the widow or husband.

(b) If the deceased leaves a widow and children or a husband and children, then one-half (1/2) to the widow or husband and the other one-half (1/2) to the children of the deceased.

(c) If the deceased leaves a child or children, but no widow or husband, then the whole to the child or children.

(d) If the deceased leaves no widow, husband or child, then the recovery shall pass to the mother and father of the deceased, one (1) moiety each, if both are living; if the mother is dead and the father is living, the whole thereof shall pass to the father; and if the father is dead and the mother living, the whole thereof shall go to the mother. In the event the deceased was an adopted person, “mother” and “father” shall mean the adoptive parents of the deceased.

(e) If the deceased leaves no widow, husband or child, and if both father and mother are dead, then the whole of the recovery shall become a part of the personal estate of the deceased, and after the payment of his debts the remainder, if any, shall pass to his kindred more remote than those above named, according to the law of descent and distribution.

In analyzing KRS 411.130, we are mindful of the “basic rule in statutory interpretation” that “the ‘plain meaning’ of the statute controls.” Commonwealth v. McBride, 281 S.W.3d 799, 803 (Ky.2009). Under the plain language of the statute, the cause of action “belongs” to the beneficiaries of the wrongful death claim, as the amount recovered in a wrongful death action “shall be for the benefit of and go to the kindred of the deceased[.]” KRS 411.130(2). The statute requires one-half of the proceeds from the wrongful death action to be distributed to the surviving spouse, with the other one-half passing to the children of the decedent. KRS 411.130(2)(a)-(b). Only when the deceased leaves no surviving spouse, no children, and no parents will the recovery pass directly to the estate, where the debts of the estate are to be paid before the remainder is distributed to the deceased’s “kindred more remote” than those named. KRS 411.130(2)(e).

The personal representative is vested with the responsibility of bringing the action, but the representative is not a statutory beneficiary entitled to recovery. See Vaughn’s Administrator v. Louisville N.R. Co., 297 Ky. 309, 179 S.W.2d 441 (1944). The language of the early wrongful death statutes in Kentucky invited confusion regarding which party — the widow, heir, or estate — was entitled to institute a cause of action for wrongful death. See Henderson’s Adm’r v. Kentucky C.R. Co., 86 Ky. 389, 5 S.W. 875 (1887). As a result of this confusion, the drafters of Section 241 explicitly identified the personal representative as the party who must prosecute the claim. See 4 Debates at 4717. Aligning with that constitutional mandate, KRS 411.130(1) directs that the estate’s representative prosecute the claim. In the context of the statute as a whole, “prosecute” necessarily means “to commence and carry out a legal action.” Black’s Law Dictionary 1341 (9th ed.2009). The statute does not accord any benefit of the recovery to the personal representative. With no interest in the recovery, the personal representative is a “nominal” party, as the “real parties in interest are the beneficiaries whom [the personal representative] represents.” Vaughn’s Administrator, 179 S.W.2d at 445.

Furthermore, the right to bring an action is not always tantamount to the right to benefit from that action, as illustrated in this Court’s recent decision in Branham, 307 S.W.3d 94. In Branham, the wife of a man who was injured in a car accident when he was a minor brought suit against the attorney who settled the litigation stemming from the accident. Id. at 96. The wife, who was appointed guardian of her husband after he was declared incompetent, alleged that an attorney-client relationship had existed between the attorney and her husband by virtue of the attorney’s representation of her husband’s next friend, his mother. Id. We held that the attorney who pursues claims on behalf of a minor’s next friend owes , professional duties to the minor, rejecting the position that the minor’s guardian or next friend is the attorney’s only client. 307 S.W.3d at 98. Branham was based in part on our conclusion that since a “guardian’s authority to settle litigation is intended to be on behalf of the ward,” and is not intended to further the guardian’s own interests, in turn, “any legal action by the guardian must be to help the ward, not necessarily the guardian.” Id. To hold that an attorney only represents the guardian’s interest, we opined, would be to ignore the minor’s “direct interest” in the underlying action. Id. at 99 (internal citations omitted). Similarly, construing the language of KRS 411.130 which requires the personal representative to bring a wrongful death action as elevating that representative to the rank of statutory beneficiary would require this Court to disregard the plain language of KRS 411.130(2) specifically identifying those individuals to whom the action belongs. See County of Harlan v. Appalachian Regional Healthcare, Inc., 85 S.W.3d 607, 611 (Ky.2002) (“General principles of statutory construction hold that a court must not be guided by a single sentence of a statute but must look to the provisions of the whole statute and its object and policy.”).

As for the Kentucky and federal authorities cited by Pete, Wheeler v. Hartford Accident and Indemnity Co., 560 S.W.2d 816 (Ky.1978); Tennimon v. Bell Helicopter Textron Inc., 823 F.2d 68 (5th Cir. 1987); Spangler’s Administrator v. City of Middlesboro, 301 Ky. 237, 191 S.W.2d 414 (1945), these cases uniformly declare that the personal representative is the only party that may maintain the wrongful death cause of action on ■ behalf of the estate. This contention is uncontested as the plain language of the statute supports it.⁷

Finally, this Court’s recent decision in Ping v. Beverly Enterprises, Inc., 376 S.W.3d 581 (Ky.2012) puts to rest any dispute as to whether the statutory beneficiaries are the real parties in interest to a wrongful death action. In Ping, the administrator of the estate of a woman who had been a long-term care facility resident brought suit against the operators of the facility alleging negligence resulting in injuries causing the woman’s death. 376 S.W.3d at 586. Our opinion, which resolved the question of whether a decedent can bind his or her beneficiaries to arbitrate a wrongful death claim, examined the distinction between the wrongful death statute and the survival statute, KRS 411.140.⁸ 376 S.W.3d at 598. We concluded that while a survival action is derivative of a personal injury claim which belongs to the estate, a wrongful death action is an independent claim belonging to the intended beneficiaries under KRS 411.130, a claim that “accrues separately to the wrongful death beneficiaries and is meant to compensate them for their own pecuniary loss.” Id. at 598-99. Based on the plain language of KRS 411.130 and our holding in Ping, we must reject Pete’s contention that the wrongful death action belongs to the estate.

Accordingly, we find that Michael, Jr. and Malik were real parties in interest with regard to the wrongful death claim. See Vaughn’s Administrator, 179 S.W.2d at 445. As the intended beneficiaries of the claim, they were entitled to one-half of the proceeds of any recovery and thus, Pete’s actions in litigating the claim must be construed as having been undertaken for Michael, Jr. and Malik’s benefit.⁹ Michael, Jr. and Malik had standing to bring the malpractice claim, and the one-year statute of limitations period applicable to a professional negligence claim was tolled until they reached the age of majority.

III. The Professional Malpractice Complaint Did Not Waive Any Loss of Consortium Claim.

Finally, Pete claims that Michael, Jr. and Malik waived any claim arising out of his alleged failure to assert a loss of parental consortium claim on their behalf. He argues that Michael, Jr. and Malik “failed to make any allegations whatsoever in the Complaint filed against [Pete and the other attorneys] related to any personal claims they purportedly had against Dixie Warehouse, such as for loss of consortium.” In response, Michael, Jr. and Malik correctly note that Kentucky is a notice pleading jurisdiction, where the “central purpose of pleadings remains notice of claims and defenses.” Hoke v. Cullinan, 914 S.W.2d 335, 339 (Ky.1995) (citing Lee v. Stamper, 300 S.W.2d 251 (Ky.1957)). The complaint pleaded generally that Pete owed the Plaintiffs a professional duty of care in connection with what they deemed the “Prior Action.” While the complaint specifically referenced Michael, Jr. and Malik’s standing as statutory beneficiaries of the wrongful death action it also contained a more general statement that Pete owed “the Plaintiffs the duty to protect their interests with the reasonable care, skill, legality and diligence possessed and exercised by a Kentucky attorney and/or Kentucky law firm practicing in similar circumstances.” This general allegation was sufficient notice of professional negligence claims generally, not simply those arising from the statutory wrongful death claim.¹⁰

CONCLUSION

For reasons stated herein, we affirm the Court of Appeals’ Opinion reversing and remanding the summary judgment granted by the trial court in Pete’s favor. This matter is remanded to Jefferson Circuit Court for further proceedings consistent with this Opinion.

MINTON, C.J.; KELLER, and VENTERS, JJ., concur. NOBLE, J., concurs in part and dissents in part by separate opinion. SCOTT, J., concurs in part and dissents in part by separate opinion in which CUNNINGHAM, J., joins.

1 . Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993).

2 . Elizabeth Anderson filed a pro se appeal, but it was ultimately dismissed for failing to comply with appellate rules.

3 . Logically, Elizabeth, as mother of the minor children, would have acted as their "next friend” in pursuing any legal claims the children had. See Branham, 307 S.W.3d at 97-98.

4 . Pete sought and received a protective order from discovery prior to entry of the summary judgment.

5 . "The maxim, “[a]ctio personalis moritur cum persona," was the uniform rule of the common law, and prevails in Kentucky to-day [sic], except where it has been modified by the express language of the Constitution and statute.” Gregory v. Illinois Cent. R. Co., 80 S.W. 795 (Ky.1904).

6 . See also John Fabian Witt, The Long History of State Constitutions and American Tort Law, 36 Rutgers L.J. 1159 (2005).

7 . Interestingly, Wheeler v. Hartford Accident and Indemnity Co. provides that “[cjontraiy to the requirements of ICRS 411.130, when a personal representative refuses to bring an action, the beneficiary may do so in her own name.” 560 S.W.2d at 819 citing Harris v. Rex Coal Company, 177 Ky. 630, 197 S.W. 1075 (1917).

8 . KRS 411.140, the so-called "survival statute,” provides: "No right of action for personal injury or for injury to real or personal property shall cease or die with the person injuring or injured, except actions for slander, libel, criminal conversation, and so much of the action for malicious prosecution as is intended to recover for the personal injury. For any other injury an action may be brought or revived by the personal representative, or against the personal representative, heir or devisee, in the same manner as causes of action founded on contract.”

9 . Given their position as statutory beneficiaries, they need not rely on third-party beneficiary status to establish that Pete owed them professional duties. See Seigle v. Jasper, 867 S.W.2d at 476, (holding that an attorney may be liable to third parties).

10 . Discovery was stayed, on Pete's motion, four months after the complaint was filed. The summary judgment motion was filed two months later and, in fact, no discovery was ever conducted regarding the nature of Pete’s attorney-client relationship with the minor Anderson children. In their response to the summary judgment motion, the Andersons made clear their intent to litigate all claims they had against Pete including failure to "assert, on behalf of Michael and Malik, a cause of action for the loss of services of their father.”