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Hammel v. McCulloch

Court of Appeals of Oregon

April 3, 2019

Ryan HAMMEL and Jamie Hammel, Plaintiffs-Appellants,
v.
Mark McCULLOCH, individually and Powers McCulloch & Bennett, LLP, an Oregon limited liability partnership, Defendants-Respondents.

          Argued and submitted January 5, 2018

          Multnomah County Circuit Court 15CV26359 Henry C. Breithaupt, Judge pro tempore.

          Kelly L. Andersen argued the cause for appellants. Also on the briefs was Kelly L. Andersen, P. C.

          Peter R. Mersereau argued the cause for respondents. On the brief were Thomas W. McPherson and Mersereau Shannon LLP.

          Before Armstrong, Presiding Judge, and Tookey, Judge, and Sercombe, Senior Judge.

         Case Summary:

         In this legal malpractice case, plaintiffs alleged that defendants were negligent in failing to pursue claims against certain entities in connection with personal injury litigation that defendants had previously commenced on plaintiffs' behalf. Defendants moved for summary judgment contending that plaintiffs could not establish the "causation" and "harm" elements of their legal malpractice claim. The trial court granted defendants' motion and entered judgment in favor of defendants. Plaintiffs appeal the judgment, arguing that the trial court erred because the evidence they adduced should have defeated defendants' motion.

         Held:

         The trial court erred. The evidence adduced by plaintiffs created a genuine issue of material fact on the elements of causation and harm.

         [296 Or.App. 844] TOOKEY, J.

         This legal malpractice case has its beginnings in a Tri-Met bus striking five pedestrians in a Portland crosswalk. Plaintiffs, Ryan and Jamie Hammel, allege, among other points, that defendants, attorney Mark McCulloch and the law firm of Powers McCulloch & Bennett, LLP, were negligent in failing to pursue claims against certain entities in connection with the personal injury litigation that defendants commenced on plaintiffs' behalf as a result of being struck by the Tri-Met bus. The trial court granted summary judgment to defendants on the grounds that plaintiffs could not establish the "causation" and "damages" elements of their legal malpractice claim. Plaintiffs appeal the trial court's judgment in favor of defendants. For the reasons that follow, we reverse the grant of summary judgment to defendants and remand for further proceedings.

         We review a trial court's grant of summary judgment to determine whether there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. ORCP 47 C.[1] "That standard is satisfied if, viewing the relevant facts and all reasonable inferences in the light most favorable to the nonmoving party-here, plaintiff [s]-no objectively reasonable juror could return a verdict for [plaintiffs] on the matter that is the subject of the motion for summary judgment." Hinchman v. UC Market, LLC, 270 Or.App. 561, 566, 348 P.3d 328 (2015) (internal quotation marks omitted); see also Mason v. BCK Corp., 292 Or.App. 580, 587, 426 P.3d 206, rev den, 363 Or. 817 (2018) (in analyzing a motion for summary judgment, "the court determines whether there is 'some evidence' or 'any evidence' that presents a genuine issue of material fact for the jury to resolve"). We state the facts consistently with that standard.

         I. FACTS

         A. History of the Underlying Litigation

         In April 2010, a Tri-Met bus struck five pedestrians in a crosswalk in Northwest Portland. Plaintiffs, as well as [296 Or.App. 845] Robert Gittings, were injured in the bus accident, but survived their injuries. The two other individuals who were struck by the bus, Danielle Sale and Jenee Hammel, died as a result of their injuries.

         Subsequently, the personal representative of the Estate of Jenee Hammel, the personal representative of the Estate of Danielle Sale, and Gittings (the products-liability claimants), filed wrongful death and personal injury claims against Tri-Met. Additionally, the products-liability claimants filed claims against the manufacturer of the bus, New Flyer, and against the manufacturers, Hadley and Rosco, of a side-view mirror that was installed on the bus.

         In October 2010, plaintiffs retained defendants to represent them in connection with the injuries that they had sustained as a result of the bus striking them. After consultation with defendants, plaintiffs asserted claims against Tri-Met, but not against New Flyer, Hadley, or Rosco. Less than a month after asserting their claims against Tri-Met, plaintiffs contacted a different attorney, Michelle Burrows, who eventually replaced defendants as attorney of record in the litigation. By the time that Burrows replaced defendants, the statute of limitation had run on plaintiffs' unasserted claims against New Flyer, Hadley, and Rosco. Subsequently, plaintiffs' and the products-liability claimants' lawsuits were consolidated.

         As a result of the lawsuits filed against it, Rosco entered a global settlement with the products-liability claimants in the amount of $225, 000. The $225, 000 was equally divided among the three products-liability claimants, with each claimant receiving $75, 000. Additionally, Hadley settled with each of the products-liability claimants for $100, 000.

         Tri-Met and New Flyer entered a settlement with plaintiffs and the products-liability claimants. Specifically, Tri-Met and New Flyer each agreed to pay $2 million in exchange for plaintiffs and the products-liability claimants releasing their claims. The question of how the total settlement fund of $4 million would be distributed among plaintiffs and the products-liability claimants was left to plaintiffs and the products-liability claimants, and their [296 Or.App. 846] respective attorneys, to determine, which they subsequently did.

         The $2 million global settlement proceeds received from Tri-Met were distributed as follows:

• $603, 911 to the Estate of Jenee Hammel;
• $546, 939 to Gittings;
• $524, 150 to the Estate of Danielle Sale; and
• $325, 000 to plaintiffs.

         The $2 million global settlement proceeds received from New Flyer were distributed as follows:

• $721, 089 to the Estate of Jenee Hammel;
• $653, 061 to Gittings; and
• $625, 850 to the Estate of Danielle Sale.

         Thus, plaintiffs received 16.25 percent of the $2 million paid by Tri-Met, but none of the $2 million that was paid by New Flyer to the products-liability claimants. Instead, according to plaintiffs, the $2 million that was paid by New Flyer was "simply redistributed to the [products-liability claimants] in exact mathematically increased proportion to what they had received from Tri-Met." That is, "the distribution of New Flyer's $2 million was not a renegotiation by the attorneys and clients involved," but rather "a simple duplication of the Tri-Met negotiations, without [plaintiffs]."

         Plaintiffs did not participate in the distribution of the $2 million global settlement received from New Flyer, the $225, 000 global settlement received from Rosco, or the $100, 000 settlements received from Hadley, because defendants did not file claims against New Flyer, Rosco, or Hadley.

         B. Procedural History of the Legal Malpractice Case

         After resolution of their claims against Tri-Met, plaintiffs brought an action for legal malpractice against defendants. In the operative complaint, plaintiffs allege that (1) defendants were negligent in failing to file claims against New Flyer, Rosco, and Hadley, and (2) had defendants done [296 Or.App. 847] so, plaintiffs would have received settlement funds from New Flyer, Rosco, and Hadley.

         In the trial court, defendants moved for summary judgment on plaintiffs' legal malpractice claim. Defendants argued that plaintiffs could not prove the essential elements of "harm" and "causation" because there was no evidence that plaintiffs would have recovered "more in the global settlement if they had *** alleg[ed] products liability claims."

         In opposition to defendants' motion for summary judgment, plaintiffs argued, among other points, that if they had filed a claim against New Flyer it was "highly probable" that plaintiffs "would have received the same distribution of the $325, 000 of the New Flyer funds that they had received of the Tri-Met funds." They also argued that because 16.25 percent was their "agreed-upon share" of the Tri-Met settlement funds, it was probable that plaintiffs would have received the same share of the settlement funds paid by Rosco and Hadley if defendants had filed claims against Rosco and Hadley. In opposing defendants' motion for summary judgment, plaintiffs relied on, among other evidence, (1) an October 12, 2016, declaration from Burrows (the Burrows declaration), who, as noted above, replaced defendants as plaintiffs' attorney of record in the underlying litigation, and (2) an October 13, 2016, declaration from Hala Gores (the Gores declaration), who represented the personal representative of the Estate of Jenee Hammel in the underlying litigation.

         The trial court granted defendants' summary judgment motion. In a November 9, 2016, letter opinion, the trial court concluded, in pertinent part, that

"[t]he question in this case is how, if at all, would both pay-ors of settlement funds and persons dividing those funds behaved differently if Defendants had pursued a claim against certain products liability defendants. None of the declarations proffered by Plaintiffs serve as a valid basis for a conclusion in that regard. * * * The problem is that the question of motive and behavior of either insurance companies or the other plaintiffs can be resolved only by evidence from those parties and not by third-party commentators on what might have happened differently. The motives and [296 Or.App. 848] behaviors about which the declarants here would testify are either hearsay (that is, based on statements made by the other plaintiffs or insurance company representatives to the declarants), incompetent, or speculative."

         On appeal, plaintiffs contend, among other points, that the record permits an inference that, if defendants had sued New Flyer, Rosco, and Hadley, "at the very least plaintiffs would have received the same $325, 000 from New Flyer as they had received from Tri-Met, and they almost ...


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