Barr v. Day

• Decision Date: 11 August 1994
• Docket Number: No. 60620-0,60620-0
• Citation: 124 Wn.2d 318,879 P.2d 912
• Court: Washington Supreme Court
• Parties: Ella BARR, individually and as Personal Representative of the Estate of Lewis D. Barr, Respondent, v. Gerald G. DAY and Jane Doe Day, husband and wife, d/b/a Eastridge Law Offices, and Gerald G. Day, P.S., a Washington corporation, and Randall Stamper and Jane Doe Stamper, husband and wife; of Stamper & Taylor, P.S., a Washington corporation, and Steven Stocker and Jane Doe Stocker, husband and wife, Petitioners.

Page 318

124 Wn.2d 318

879 P.2d 912

Ella BARR, individually and as Personal Representative of

the Estate of Lewis D. Barr, Respondent, v. Gerald G. DAY and Jane Doe Day, husband and wife, d/b/a

Eastridge Law Offices, and Gerald G. Day, P.S., a Washington

corporation, and Randall Stamper and Jane Doe Stamper,

husband and wife; of Stamper & Taylor, P.S., a Washington

corporation, and Steven Stocker and Jane Doe Stocker,

husband and wife, Petitioners.

No. 60620-0.

Supreme Court of Washington,

En Banc.

Aug. 11, 1994.

As Amended Oct. 6, 1994.

Reconsideration Denied Nov. 2, 1994.

Lee, Smart, Cook, Martin & Patterson, P.S., Inc., Sam B. Franklin, Seattle, for petitioners Day.

Evans, Craven & Lackie, P.S., James S. Craven, Philip J. Van de Veer, Spokane, for petitioners Stamper, et al.

Crary & Clark, P.S., Robert B. Crary, Spokane, for respondent.

Bryan P. Harnetiaux, Harbaugh & Bloom, Gary N. Bloom, Spokane, for amicus curiae Washington State Trial Lawyers Ass'n.

Paul Peterson, Seattle, for amicus curiae Washington Defense Trial Lawyers.

DURHAM, Justice.

Attorneys Gerald Day and Randall Stamper represented Ella Barr and her deceased husband Lewis in a tort action against his employer, a tugboat operator. Lewis Barr had suffered a severe head injury in an accident while working on a tugboat. The suit settled prior to trial, and the settlement was approved by the Superior Court. Attorney Steven Stocker acted as Lewis Barr's guardian ad litem, and recommended approval of the settlement, including an award of attorney fees.

Ella Barr subsequently filed suit contending that the award of attorney fees was excessive and a breach of contract, and that Day and Stamper breached their fiduciary duties by failing to advise the Barrs, in light of Lewis's poor health, of the possibility of a lump sum settlement instead of a structured settlement. The suit also alleged that Stocker negligently approved the settlement. The trial court dismissed Barr's claims on summary judgment as barred by collateral estoppel as to Day and Stamper, and by witness immunity as to Stocker. The Court of Appeals reversed and remanded for trial. The court held that collateral estoppel and witness immunity did not preclude the action, and suggested there were genuine issues of material fact. We affirm in part and reverse in part.

We must decide whether judicial approval of the settlement estops Barr from advancing her claims, whether Stocker is protected from liability by witness or judicial immunity, and whether various issues pertaining to the fee arrangement may be resolved as matters of law. We hold (1) that Barr is not collaterally estopped from advancing her claims, (2) that Stocker is protected from liability as a matter of law by quasi-judicial immunity, and (3) that Day is entitled to compensation only in quantum meruit because he was effectively discharged by Mrs. Barr. Stamper also is entitled to compensation only in quantum meruit, unless there is a separate written contingency fee agreement between Mrs. Barr and Stamper that was not made part of the record before us.

FACTS

In October of 1982, Lewis Barr fell and sustained a severe head injury while working on a Crowley Maritime tugboat. In December of 1982, Lewis hired Day to represent him in matters relating to the accident. Under the terms of the contract Lewis signed, Day was to receive one-third of "the amount received by the client" if the case went to trial, or between 25 and 30 percent of any settlement, depending on how near to trial the settlement was reached. Clerk's Papers (CP), at 19.

Two and one-half years later, Day filed suit on the Barrs' behalf against Crowley Maritime Corporation and Puget Sound Tug and Barge Company, as well as Reynold Power Transmission Corporation and Besco Corporation. On July 21, 1986, the Superior Court appointed Ella Barr as Lewis's guardian. On July 22, 1986, Ella discharged Day. Notwithstanding the discharge, on July 23, Day associated with Stamper as an additional attorney for the Barrs.

An agreement was eventually reached under which the Barrs would receive $313,333 in cash from Reynold, $183,333 in cash from Crowley, $3,000 from Besco, and an annuity guaranteed for 5 years and thereafter as long as Lewis Barr should live. Barr also received $180,935 under the admiralty law doctrine of "maintenance and cure" and $6,077 in pension and welfare trust advances in the period before a final settlement was reached.

The Barrs and Stamper discussed six different annuity payment plans. The Barrs ultimately selected an option under which they would receive increasing amounts each month, beginning at $2,180. The present value of the annuity, plus the amounts the Barrs had already received in maintenance and cure, and pension and welfare advances, plus the cash sums Crowley, Reynold, and Besco agreed to pay, equals $1,079,493.27. Deducting 30 percent from that total for attorney fees ($323,847.96) results in a net recovery of $755,645.42. Subtracting from that the amounts the Barrs had already received and the present value of the annuity would leave the Barrs with an immediate cash payment of $151,920.90.

Since Lewis was incompetent, and a guardianship had been established for him in Spokane County, the settlement had to be approved by the Spokane County Superior Court. Lewis and Ella Barr and attorneys Randall Stamper and Steven Stocker appeared before the court on June 17, 1987. Stamper described Lewis's accident and the terms of the settlement, including the attorney fee award, and asked the court to approve the settlement. He also asked that $100,000 of the cash distribution be paid to Ella, for her loss of consortium, and the balance (about $52,000) be paid into Lewis's guardianship account.

Stocker testified that he had been requested to examine the settlement as Lewis's court-appointed guardian ad litem. Stocker said he met with the Barrs and discussed the settlement proposal with them, and that both he and they thought the settlement and the attorney fee request fair.

Ella then testified that she reviewed the settlement with both Stamper and Stocker and that she approved of it. The court asked Ella if she discussed the fees charged by Stamper and Stocker. Ella responded, "Right". CP, at 57. The court then asked Ella if she and Lewis felt attorney fees were fair and reasonable. She said, "Um hm, I do". CP, at 59. Notwithstanding his status as incompetent, Lewis testified that he remembered signing the attorney fee agreement with Day and that he felt a 30 percent fee was acceptable. Lewis also said he discussed the entire settlement with Stamper "over and over" and that he "totally" agreed with it. CP, at 61-62. The court remarked that Stamper and Day had "done a very credible job.... And, the overall settlement ... do[es] appear to be fair and reasonable". CP, at 62-63. The court then approved the settlement, "as well as the attorneys' fees and costs". CP, at 63.

Lewis died less than 2 years after the settlement of causes unrelated to his head injury. In 1990, Ella filed suit against Day, Stamper, and Stocker on behalf of herself and Lewis's estate, for which she is the personal representative. She alleged that Day and Stamper breached their contract with the Barrs by charging a fee in excess of that agreed upon and negligently valued the annuity, thereby breaching their fiduciary duties. She further alleged that Stocker negligently failed to protect Lewis's interests.

The parties moved for summary judgment. Stocker claimed that he was protected by the absolute immunity accorded witnesses. Both Day and Stamper argued that Barr was collaterally estopped from challenging the reasonableness of the attorney fee award and that she could not, in any event, prove a prima facie case of legal malpractice. The trial court granted all three defendants' motions and dismissed Barr's complaint in its entirety. With respect to Stamper and Day, the complaint was dismissed solely on grounds of collateral estoppel. With respect to Stocker, the complaint was dismissed on grounds of witness immunity. The Court of Appeals reversed and remanded for trial. This court accepted review.

Standard of Review

When reviewing an order granting summary judgment, the appellate court engages in the same inquiry as the trial court. Syrovy v. Alpine Resources, Inc., 122 Wash.2d 544, 548 n. 3, 859 P.2d 51 (1993). An appellate court will affirm summary judgment if the pleadings, depositions, answers to interrogatories, admissions, and affidavits show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. CR 56(c). In summary judgment, all facts and reasonable inferences are to be considered in the light most favorable to the nonmoving party, and all questions of law are reviewed de novo. Caritas Servs., Inc. v. Department of Social & Health Servs., 123 Wash.2d 391, 402, 869 P.2d 28 (1994).

Collateral Estoppel

Petitioners first contend that Barr cannot challenge the reasonableness of the attorney fees in this proceeding because the same fees were determined to be reasonable when the court in the guardianship proceeding approved the Barrs' tort settlement.

Collateral estoppel, also known as issue preclusion, "prevents relitigation of an issue after the party estopped has had a full and fair opportunity to present its case". Hanson v. Snohomish, 121 Wash.2d 552, 561, 852 P.2d 295 (1993). See also Philip A. Trautman, Claim and Issue Preclusion in Civil Litigation in Washington, 60 Wash.L.Rev. 805 (1985). For there to be collateral estoppel four requirements must be met:

(1) the issue decided in the prior adjudication must be identical with the one presented in the second; (2) the prior adjudication must have ended in a final judgment on the merits; (3) the party against whom the plea is asserted was a party or in privity with a party to the prior adjudication; and (4) application of the...