Blough v. Wellman, 24333
| Decision Date | 12 February 1999 |
| Docket Number | No. 24333,24333 |
| Citation | 974 P.2d 70,132 Idaho 424 |
| Parties | Kim BLOUGH, Plaintiff-Appellant, v. William H. WELLMAN, Defendant-Respondent. Boise, December 1998 Term |
| Court | Idaho Supreme Court |
Ellis, Brown, & Sheils, Chdt., Boise, for appellant. Allen B. Ellis argued.
Brassey, Wetherell, Crawford & McCurdy, Boise, for respondent. J. Nick Crawford argued.
Kim Blough appeals from the summary judgment entered against him on his complaint for damages resulting from alleged legal malpractice brought against William Wellman, his former attorney and business partner in the Airport Business Center Partnership. Because we conclude that a genuine issue of material fact exists as to whether there was an attorney/client relationship between Blough and Wellman, we vacate the judgment, and remand the matter for further proceedings in the district court.
Beginning in 1983, Kim Blough retained the services of William Wellman with respect to various legal matters. In 1987, Blough contacted Wellman regarding a zoning problem In 1994, acting on behalf of himself and three other partners, Wellman sought to dissolve the partnership and entered into an option contract to sell his partnership interest, causing a lien to be recorded against the partnership property. When Blough attempted to obtain a zoning change for the benefit of his auto dismantling business in 1996, Wellman attended a meeting of the Nampa City Council and advised against granting the zoning change to the partnership property. These actions by Wellman led Blough to file suit seeking damages for legal malpractice which allegedly contributed to financial losses incurred by Blough.
with the auto dismantling business Blough was operating at his residence, and Wellman wrote a letter to the Nampa City Council on Blough's behalf. Blough then embarked on a search for a parcel of real estate where he could relocate his dismantling business; his plan was to form a partnership to purchase the property which he would then rent from the partnership. Wellman drafted a partnership agreement for the purposes of purchasing and managing the property described in the escrow agreement signed by Blough in April 1987. The partnership agreement was signed on May 31, 1987, by Blough and Wellman, who became a twenty percent owner, and three others. Except for drafting the partnership agreement, Wellman did not perform any other legal services related to the partnership and did not represent Blough again individually after 1989.
In his complaint, Blough asserted that Wellman had breached his fiduciary duty of loyalty to his client not to represent an interest, even the attorney's personal interest, that was materially adverse to Blough's interests. Blough claimed that by initiating dissolution of the partnership in 1994 and by speaking against a proposed zoning change to the partnership property in 1996, Wellman had breached his duty of loyalty. Blough also asserted claims of negligence against Wellman for causing a lien to be recorded against the partnership property in connection with an option contract entered into by Wellman to sell his partnership interest and for "failing to cooperate and assist plaintiff (Blough) in the operation of the partnership and marketing of the partnership property."
Wellman answered, admitting that he had performed certain legal services for Blough beginning in 1983. Wellman denied that he had prepared the partnership agreement for Blough or ever charged him for it, and he indicated that he did not represent Blough in personal matters after 1989. Wellman thereafter filed a motion for summary judgment claiming that he was entitled to judgment as a matter of law on Blough's complaint. On October 16, 1997, the district court issued an opinion and order awarding summary judgment to Wellman. Blough moved the district court to reconsider its decision, but the district court denied the motion. Blough then filed a notice of appeal from the judgment.
Summary judgment must be entered when the pleadings, depositions, admissions on file and affidavits, if any, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. I.R.C.P. 56(c); Roell v. Boise City, 130 Idaho 197, 938 P.2d 1237 (1997). The Court liberally construes the record in the light most favorable to the party opposing the motion and draws all reasonable inferences and conclusions in that party's favor. Id. If reasonable persons could reach different conclusions or draw conflicting inferences from the evidence, the motion should be denied. Id. Absent disputed issues of material facts, the appellate court exercises free review over the matter. Friel v. Boise City Housing Authority, 126 Idaho 484, 485, 887 P.2d 29, 30 (1994).
Following the summary judgment hearing, the district court concluded that Blough failed to make a prima facie case of legal malpractice, 1 after finding that no attorney- On appeal, Blough argues that Wellman owed him a continuing duty of loyalty as a former client who sought advice on a zoning problem that led to a discussion between Blough and Wellman regarding the purchase of real property, the appropriate business entity under which to acquire the real property and the relocation of Blough's business onto such property. Blough further contends that Wellman's duty of loyalty to him was not suspended when Wellman became a business partner with Blough in the partnership and that the duty was breached by Wellman's 1994 and 1996 activities which Blough maintains were adverse to his interests in the partnership.
/client relationship existed between Wellman and Blough which was substantially related to the partnership after its formation. Based on its finding, the district court also distinguished this case from Damron v. Herzog, 67 F.3d 211 (9th Cir.1995), relied upon by Blough, in which an attorney who interposed himself into a matter "substantially related" to that for which he was previously retained by the client was held to have created a situation in which the attorney-client relationship "re-attached." The district court made a finding, without elaboration, that there was no attorney/client relationship to which the duty of loyalty could re-attach
The relationship of client and attorney is one of trust, binding an attorney to the utmost good faith in fair dealing with his client, and obligating the attorney to discharge...
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