Shealy v. Lunsford

355 F. Supp. 2d 820, 2005 U.S. Dist. LEXIS 2043, 2005 WL 318645
CourtDistrict Court, M.D. North Carolina
DecidedJanuary 31, 2005
Docket1:03 CV 1000
StatusPublished

This text of 355 F. Supp. 2d 820 (Shealy v. Lunsford) is published on Counsel Stack Legal Research, covering District Court, M.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shealy v. Lunsford, 355 F. Supp. 2d 820, 2005 U.S. Dist. LEXIS 2043, 2005 WL 318645 (M.D.N.C. 2005).

Opinion

MEMORANDUM OPINION

BEATY, District Judge.

I. INTRODUCTION

This case involves allegations of attorney malpractice by three successive attorneys. Plaintiff Lisa B. Shealy (“Shealy”) originally hired Defendant Robert V. Shaver, Jr., (“Shaver”), who was employed by the Defendant law firm of Floyd & Jacobs, L.L.P., (“Floyd & Jacobs”), to defend her against allegations of alienation of affection and criminal conversation in North Carolina state court (the “Original Action”). After Shealy had an entry of default lodged against her in the Original Action, *822 Shealy fired Shaver and the law firm of Floyd & Jacobs, and subsequently employed Defendant John W. Lunsford (“Lunsford”) to defend her in the default judgment hearing. After a default judgment was entered for $2 million in the Original Action, Shealy fired Lunsford and hired attorney Desa Ballard (“Ballard”).

Shealy, through her counsel Ballard, subsequently filed this lawsuit on February 28, 2003, in South Carolina state court against Shaver, Floyd & Jacobs, and Luns-ford, alleging attorney malpractice by those parties in their previous defense of Shealy. Defendant Floyd & Jacobs moved for removal to federal court, and later moved jointly with Shaver for a transfer to this Court based on venue because all of the attorneys were from North Carolina. That transfer was completed on September 30, 2003. Once the lawsuit arrived in this Court, Defendant Lunsford filed cross-claims against Shaver and Floyd & Jacobs, 1 and also sued Ballard for contribution or indemnity, alleging that Ballard was also negligent in representing Shealy by failing to perfect an appeal of the default judgment. Thus, this Court has two motions presently before it: Defendants Shaver and Floyd & Jacobs’ joint Motion for Judgment on the Pleadings [Document # 34] as to the Complaint by Shealy and as to the Cross-Claim by Defendant Luns-ford. Additionally, Third-Party Defendant Desa Ballard has filed a Motion to Dismiss or, Alternatively, to Strike or Sever for Separate Trial [Document # 32] the claim filed against her by Lunsford.

II. FACTUAL BACKGROUND

The Court will briefly recite the factual basis for the two motions, taking the facts in a light most favorable to Shealy and to Lunsford, as is proper in considering a motion to dismiss. In the Complaint before the Court, Shealy alleges that Shaver, Floyd & Jacobs, and Lunsford are liable to her for legal malpractice. Shealy initially hired Shaver, a member of Floyd & Jacobs, after she was sued on December 4, 1998, in the District Court of Guilford County for alienation of affection. Cooper v. Shealy, 98 CVD 11312 (Guilford Co., N.C.). On May 27, 1999, Shaver filed a motion on behalf of Shealy in State court to have that lawsuit dismissed against Shealy based on lack of personal jurisdiction, because Shealy was and is a South Carolina resident. That motion was denied by the State trial court on June 19, 1999. In response to that denial of the personal jurisdiction motion, Shaver filed a timely notice of appeal on July 28, 1999, and did in fact file an interlocutory appeal in the North Carolina Court of Appeals. However, Shaver did not file an Answer to the Complaint filed in the state case within twenty days following the trial court’s determination that there was personal jurisdiction over Shealy. Therefore, on or about December 2, 1999, while the appeal of the personal jurisdiction issue was pending, an entry of default was entered by the state court clerk against Shealy based upon the application of the Plaintiff in the Original Action. Shaver then moved to set aside the entry of default, but the State district court denied the motion on March 29, 2000. In that judgment, the State court found that any entry of a final default judgment would have to await the outcome of the pending appeal from the order finding that there was personal jurisdiction over Shealy. Before a ruling was made by the North Carolina Court of Appeals, Shealy asked Shaver and Floyd & *823 Jacobs to withdraw as her counsel in July 2000. Shealy hired Lunsford that same month to continue her representation in the Original Action.

On December 5, 2000, the North Carolina Court of Appeals affirmed the ruling of the trial court that found there was personal jurisdiction over Shealy. In November of 2001, the State district court held a hearing on the default judgment. Lunsford represented Shealy, and in that representation, among other things, Luns-ford advised her not to attend the default judgment hearing. At the conclusion of the hearing, the State district judge held that Shealy was liable for alienation of affection and criminal conversation, and awarded the Plaintiff in the Original Action $2 million in damages. Shortly thereafter, Shealy fired Lunsford and hired Ballard to represent her in bringing the present lawsuit alleging legal malpractice by Shaver, Floyd & Jacobs, and Lunsford.

In this Court, Shealy has specifically alleged that Shaver and the law firm of Floyd & Jacobs committed malpractice and breach of fiduciary duty by failing to file an Answer in her state case. Shealy further alleges that Lunsford committed malpractice because of a number of acts, including advising her not to attend the default judgment hearing, failing to adequately defend Shealy’s interests at the default judgment hearing, and failing to file a motion for reconsideration or notice of appeal with respect to the final default judgment, among other things. Lunsford answered Shealy’s Complaint and denied these allegations. In addition, Lunsford asserted a cross-claim against Shaver and Floyd & Jacobs that those defendants should indemnify him or contribute to any judgment awarded by the Court to Shealy. Lunsford specifically alleged that Shaver’s failure to file an Answer prevented him from raising viable defenses during Luns-ford’s representation of Shealy, and that such failure to answer was the proximate cause of Shealy’s damages. Additionally, Lunsford, in his Third-Party Complaint against Ballard, alleges that Ballard committed malpractice by failing to perfect the record for Shealy’s appeal of the default judgment against Shealy to the North Carolina Court of Appeals. Lunsford argues that Ballard’s alleged failure to perfect the record on appeal was the proximate cause of Shealy’s damages. Lunsford also seeks indemnification or contribution from Ballard for any judgment Shealy may be awarded against him as part of the present action.

As previously noted, Shaver and Floyd & Jacobs have filed a Motion for Judgment on the Pleadings under Rule 12(c) of the Federal Rules of Civil Procedure. Ballard has filed a Motion to Dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure. The Court will now discuss each of these motions in turn.

III. STANDARD OF REVIEW

When a defendant moves for judgment on the pleadings, factual allegations of the complaint are taken as true, but those of the answer are taken as true only where and to the extent that they do not conflict with the complaint. Jadoff v. Gleason,

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Bluebook (online)
355 F. Supp. 2d 820, 2005 U.S. Dist. LEXIS 2043, 2005 WL 318645, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shealy-v-lunsford-ncmd-2005.