Fahey v. Cook

1

2024 ND 138

Anne Fahey a/k/a Anne Fife, Timothy Fife, and Richard Dennis Fife, Plaintiffs and Appellants v. Andrew D. Cook, Lukas D. Andrud, Ohnstad Twichell, P.C., Defendants and Appellees

No. 20230267

Supreme Court of North Dakota

July 5, 2024

Appeal from the District Court of Cass County, East Central Judicial District, the Honorable Lolita G. Hartl Romanick, Judge.

David J. Chapman, West Fargo, ND, for plaintiffs and appellants.

Richard J. Thomas (argued) and Christopher G. Angell (on brief), Arden Hills, MN, for defendants and appellees.

OPINION

BAHR JUSTICE

[¶1] Anne Fahey, Timothy Fife, and Richard Fife (Plaintiffs) appeal from a judgment entered after the district court granted summary judgment to Andrew Cook, Lukas Andrud, and Ohnstad Twichell, P.C. (Defendants) dismissing Plaintiffs' legal malpractice action against Defendants. We conclude the court did not err in concluding collateral estoppel does not apply and did not err in granting summary judgment in favor of Defendants. We affirm.

I

[¶2] Plaintiffs' action for legal malpractice stems from Defendants' representation of Plaintiffs in Fahey v Fife, 2017 ND 200, 900 N.W.2d 250 (underlying litigation). In our opinion in that case, we set forth the following background facts:

Marianne Fife owned a mineral interest in McKenzie County. She died without a will on December 16, 1989. Upon her death Marianne Fife was an Idaho resident and was survived by her spouse, Richard A. Fife, and her three children, Anne Fahey, Timothy Fife, and Richard D. Fife. Richard A. Fife died in 1997, and was survived by his wife Joanne Fife.

On December 4, 1989, while on home care services, Marianne Fife conveyed her mineral interest to her husband Richard Fife. She also conveyed her interest in the parties' Idaho home to Richard Fife on December 1, 1989.

In 2011, Anne Fahey's aunt Carole Hill informed her about the circumstances surrounding Marianne Fife's December 4, 1989, conveyance of her mineral interest. Hill witnessed Richard Fife present a quit claim deed for Marianne Fife to sign, and Richard held Marianne's hand to help her sign her name on the deed. Hill believed Marianne Fife was not competent at the time to sign the deed, and was not informed as to what she was signing. Plaintiffs sued Joanne Fife, individually and as personal representative of Richard Fife's estate, claiming their mother lacked capacity to execute the deed because she was under medication to treat her pain. Plaintiffs also claimed their father exercised undue influence over their mother when she signed the deed. Plaintiffs requested the cancellation of the deed and sought an interest in the minerals.

After a bench trial the district court concluded Marianne Fife lacked capacity to sign the deed for the minerals. The court also concluded she signed the deed as a result of Richard Fife's undue influence. The court rescinded the deed and returned the mineral interest to Marianne Fife's estate; however, the court concluded that under North Dakota's intestate succession laws in effect when Marianne Fife died, her mineral interest passed to Richard Fife. The court quieted title to the mineral interest in Joanne Fife.

Id. at ¶¶ 2-5. Thus, while the district court rescinded the quitclaim deed for the minerals, returning the minerals to Marianne Fife's estate, the court held the minerals still passed to Richard Fife under the North Dakota intestate succession laws in effect at Marianne Fife's death and, therefore, Richard Fife's surviving spouse owned the minerals. Id. at ¶ 5.

[¶3] This Court affirmed the district court's judgment on appeal. Fahey, 2017 ND 200, ¶¶ 1, 20. On appeal, we declined to consider Plaintiffs' argument Marianne Fife's estate had a cause of action against Richard Fife relating to the conveyance of the Idaho home because Plaintiffs did not make that argument in the district court. Id. at ¶ 11. We held the court's valuation of Marianne Fife's intestate estate was not clearly erroneous, stating, "[a]ssuming without deciding that Marianne Fife's intestate estate included all property wherever located, the total value of her estate was less than $50,000 and would pass to Richard Fife under the laws in effect when she died." Id. at ¶ 17 (citing N.D.C.C. § 30.1-04-02(3); Idaho Code § 15-2-102).

[¶4] In 2018, Plaintiffs commenced this malpractice action against Defendants. Plaintiffs allege Defendants were negligent in the underlying litigation by: failing to contest the validity of the quitclaim deed purporting to convey Marianne Fife's interest in the Idaho marital home; failing to argue Marianne Fife's estate had a cause of action against Richard Fife's estate as a result of the alleged invalidity of that deed; and failing to argue Plaintiffs' inability to prove Marianne Fife's ownership and value of various personal property was because of Richard Fife's misconduct. Plaintiffs allege that, had Defendants taken those actions, the result would have been the overall value of Marianne Fife's North Dakota intestate estate would have increased to more than $50,000, and some of the minerals would have been disbursed to Plaintiffs under intestate succession laws. See N.D.C.C. § 30.1-04-02(3) (1989) (providing the "intestate share" of the surviving spouse is "the first fifty thousand dollars, plus one-half of the balance of the intestate estate[,]" "[i]f there are surviving issue all of whom are issue of the surviving spouse also").

[¶5] In granting summary judgment, the district court held Defendants did not breach their duty to Plaintiffs. The court concluded Defendants did not have a duty to take the suggested actions because the actions would not have increased the value of Marianne Fife's estate for distribution purposes. The court further held Plaintiffs did not suffer damages caused by the alleged breach of duty. The court concluded reasonable persons could only conclude that, even if Plaintiffs had successfully taken the suggested actions, the underlying litigation would not have ended more favorably for Plaintiffs because they still would not have received Marianne Fife's mineral interests.

II

[¶6] On appeal, Plaintiffs argue the district court erred in granting summary judgment on their legal malpractice claims. They contend the court erred in concluding: (1) Marianne Fife's estate, for valuation and distribution purposes, did not include real or personal property outside of North Dakota; (2) the interest in the marital home in Idaho would have bypassed probate and would never have been part of the estate valuation; (3) Defendants are not collaterally estopped from arguing Marianne Fife's interest in the marital home and personal property would never be part of the estate; and (4) a cause of action for fraud and undue influence for Richard Fife's wrongful actions had no value to Marianne Fife's estate.

[¶7] We review summary judgment decisions de novo to decide whether the information available to the district court was free of any genuine issues of material fact and whether the moving party was entitled to a judgment as a matter of law. Mullin v. Pendlay, 2022 ND 205, ¶ 5, 982 N.W.2d 330. "Summary judgment is appropriate against parties who fail to establish the existence of a factual dispute on an essential element of a claim." Riemers v. Omdahl, 2004 ND 188, ¶ 4, 687 N.W.2d 445 (quoting Zuger v. State, 2004 ND 16, ¶ 7, 673 N.W.2d 615). A party resisting a summary judgment motion may not simply rely upon the pleadings or upon unsupported, conclusory allegations. Id. "Issues of fact become issues of law when a reasonable person could reach only one conclusion from the facts." Mullin, at ¶ 5.

[¶8] A legal malpractice action against an attorney for professional negligence has four elements:

The elements of a legal malpractice action against an attorney for professional negligence are: 1) the existence of an attorney-client relationship, 2) a duty by the attorney to the client, 3) a breach of that duty by the attorney, and 4) damages to the client proximately caused by the breach of that duty.

Mullin, 2022 ND 205, ¶ 6. "When negligent representation is alleged against an attorney, the plaintiff must allege and prove performance of the act would have benefited the client." Id. "In this context, the 'case-within-a-case' doctrine applies to alleged negligently-conducted litigation and requires that, but for the attorney's alleged negligence, the litigation would have terminated in a result more favorable for the client." Johnson v. Bronson, 2013 ND 78, ¶ 22, 830 N.W.2d 595 (citation omitted). The plaintiff must prove the attorney's negligence was the proximate cause of the damage. Id. Summary judgment is ordinarily inappropriate for legal malpractice actions. Mullin, at ¶ 6.

III

[¶9] Plaintiffs argue the district court erred in concluding Defendants were not collaterally estopped from arguing Marianne Fife's interest in the Idaho marital home and personal property would never be part of the estate.

[¶10] Whether collateral estoppel applies is a question of law which is fully reviewable on appeal. Great Plains Royalty Corp. v. Earl Schwartz Co., 2021 ND 62, ¶ 19, 958 N.W.2d 128. The party asserting collateral estoppel bars relitigation of an issue in a new proceeding has the burden of establishing the doctrine applies. Witzke v. City of Bismarck, 2006 ND 160, ¶ 10, 718 N.W.2d 586. The party must prove four tests are satisfied before a court will find collateral estoppel bars relitigation of an issue involved in an earlier lawsuit. State v. Lange, 497 N.W.2d 83, 85 (N.D. 1993). The four tests are:

(1) Was the issue decided in the prior adjudication identical to the one presented in the action in question?;

(2) Was there a final judgment on the merits?;

(3) Was the party

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