Geer v. Tonnon

• Decision Date: 09 April 2007
• Docket Number: No. 57798-1-I.,57798-1-I.
• Parties: Charles W. GEER and Lynne W. Geer, individually and as husband and wife, Appellants, v. Alan TONNON, individually and the marital community composed of Alan Tonnon and Jane Doe Tonnon, Respondent.
• Court: Washington Court of Appeals

155 P.3d 163

137 Wn. App. 838

Charles W. GEER and Lynne W. Geer, individually and as husband and wife, Appellants, v. Alan TONNON, individually and the marital community composed of Alan Tonnon and Jane Doe Tonnon, Respondent.

No. 57798-1-I.

Court of Appeals of Washington, Division 1.

April 9, 2007.

Roger Keith Anderson, Seattle, WA, for Appellant.

Tyna Ek, Soha & Lang PS, Seattle, WA, for Respondent.

DWYER, J.

¶ 1 To prevail in a legal professional negligence case, the plaintiff client must demonstrate that the outcome of the underlying litigation for which the representation was provided would have been more favorable to the client than the result actually obtained but for the defendant attorney's negligence. Charles Geer appeals from the trial court's ruling granting attorney Alan Tonnon's motion for summary judgment in Geer's legal professional negligence action, which was based upon Tonnon's failure to file suit against an insurer within a one-year contractual limitation period. The trial court ruled that Geer's claim failed under both the equitable lien and retroactive endorsement theories advanced by Geer. Specifically, the trial court ruled that Geer failed to establish causation because Washington law does not permit a person who is not a named insured to enforce an equitable lien directly against an insurer. The trial court also ruled that Geer's legal professional negligence claim based upon the retroactive endorsement failed for lack of expert testimony establishing either a breach of duty or causation. Finding no error, we affirm.

FACTS

¶ 2 In January 2000, Paul and Alyson Graff executed a deed of trust as mortgagors of a house and real property in Carnation, Washington. The deed of trust contained a covenant requiring the Graffs to insure the house on behalf of the mortgagee, Charles Geer. In July 2001, the Graffs obtained a homeowners insurance policy effective through July 2002 from Underwriters at Lloyd's of London (Lloyd's). However, Geer was not named as an insured under the policy. The policy contained a one-year suit limitation period, requiring any action based upon the policy to be commenced within one year of the loss suffered. In September 2001, the house was destroyed by fire.

¶ 3 Alan Tonnon, Geer's attorney, did not file suit against Lloyd's to collect the insurance proceeds within one year of the fire, and Geer never directed Tonnon to do so. Tonnon did contact Lloyd's in an attempt to claim the insurance proceeds on Geer's behalf. In response to Tonnon's efforts, the insurance underwriter issued Geer a retroactive endorsement naming Geer as a "contract of sale holder" under the policy. However, Tonnon was never provided with notice of this endorsement. In November 2002, Lloyd's denied both the Graffs' and Geer's separate claims to the insurance proceeds on several grounds.¹ Because more than one year had elapsed since the fire, the one-year suit limitation period in the Lloyd's policy foreclosed Geer from seeking the insurance proceeds from Lloyd's in court.

¶ 4 Geer commenced this legal professional negligence action against Tonnon in August 2004, asserting damages in the amount of the insurance proceeds Geer would have recovered at trial had Tonnon filed suit against Lloyd's within the one-year limitation period. The action was premised upon two alternative theories. First, Geer claimed that he possessed an equitable lien on the Lloyd's policy proceeds by virtue of the covenant included in the Graffs' deed of trust, and that had Tonnon timely filed suit against Lloyd's to enforce Geer's equitable lien, Geer would have recovered the policy proceeds at trial. Alternatively, Geer claimed that had Tonnon timely filed suit against Lloyd's, Geer would have recovered the proceeds at trial by virtue of the retroactive endorsement naming Geer as a "contract of sale holder."

¶ 5 Tonnon and Geer both moved for summary judgment. The trial court granted Tonnon's motion, while denying Geer's. Specifically, the trial court ruled that Geer's legal professional negligence claim based upon the equitable lien theory failed because, even if Tonnon had timely filed suit against Lloyd's seeking to enforce Geer's equitable lien on the policy proceeds, Geer would not have obtained a favorable result at trial. In so holding, the trial court ruled that Washington law does not provide a person who is not a named insured with a cause of action to enforce an equitable lien on insurance policy proceeds directly against an insurer. The trial court also ruled that Geer's legal professional negligence claim based upon the retroactive endorsement failed for lack of expert testimony establishing either a breach of duty or causation. Geer appeals.

DISCUSSION

I. Standard of Review

¶ 6 We engage in de novo review of a ruling granting summary judgment. Wilson Court Ltd. P'ship v. Tony Maroni's, Inc., 134 Wash.2d 692, 698, 952 P.2d 590 (1998). In reviewing a grant of summary judgment, we conduct the same inquiry as the trial court. Anderson v. Weslo, Inc., 79 Wash.App. 829, 833, 906 P.2d 336 (1995). Summary judgment is properly granted when the pleadings, affidavits, depositions, and admissions on file demonstrate that there is no genuine issue of material fact, and that the moving party is entitled to summary judgment as a matter of law. CR 56(c); Hutchins v. 1001 Fourth Ave. Assocs., 116 Wash.2d 217, 220, 802 P.2d 1360 (1991). A material fact is one that affects the outcome of the litigation. Hisle v. Todd Pac. Shipyards Corp., 151 Wash.2d 853, 861, 93 P.3d 108 (2004).

¶ 7 The moving party bears the initial burden of establishing its right to judgment as a matter of law. Young v. Key Pharms. Inc., 112 Wash.2d 216, 225, 770 P.2d 182 (1989). Once the moving party satisfies its initial burden, the burden then shifts to the nonmoving party to show that a triable issue exists. Doherty v. Mun. of Metro. Seattle, 83 Wash.App. 464, 468, 921 P.2d 1098 (1996). All reasonable inferences from the evidence must be construed in favor of the non-moving party. Lamon v. McDonnell Douglas Corp., 91 Wash.2d 345, 349, 588 P.2d 1346 (1979). If the nonmoving party "`fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial,'" then summary judgment is properly granted in favor of the moving party. Young, 112 Wash.2d at 225, 770 P.2d 182 (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)).

II. Geer Must Prove That Had Tonnon Timely Filed Suit Against Lloyd's, Geer Would Have Obtained a Favorable Judgment

¶ 8 To establish a legal professional negligence claim against Tonnon, Geer must prove the following elements:

(1) The existence of an attorney-client relationship which gives rise to a duty of care on the part of the attorney to the client; (2) an act or omission by the attorney in breach of the duty of care; (3) damage to the client; and (4) proximate causation between the attorney's breach of the duty and the damage incurred.

Hizey v. Carpenter, 119 Wash.2d 251, 260-61, 830 P.2d 646 (1992). The primary issue presented in this case is whether Geer satisfied the causation element of his claim, based upon the equitable lien theory, by showing that had Tonnon filed suit against Lloyd's within the one-year limitation period, Geer would have obtained a favorable judgment at trial.²

¶ 9 When determining questions of causation in a legal professional negligence action, the concern is cause in fact, i.e., the "but for" consequences of an attorney's negligent act. Daugert v. Pappas, 104 Wash.2d 254, 257-59, 704 P.2d 600 (1985). For example, in a malpractice action involving an attorney's failure to file an appeal in a timely manner, the cause in fact inquiry is "whether the client would have been successful" but for the attorney's failure to timely file the appeal. Daugert, 104 Wash.2d at 258, 704 P.2d 600. In such cases, "the client must show that an appellate court would have (1) granted review, and (2) rendered a judgment more favorable to the client." Daugert, 104 Wash.2d at 258, 704 P.2d 600. Because a trial judge is in a better position than a jury to determine whether appellate review would have been granted and the client would have received a more favorable judgment, the trial judge must make this determination as an issue of law. Daugert, 104 Wash.2d at 259, 704 P.2d 600.³ Similarly, whether Geer would have obtained a favorable judgment at trial had Tonnon filed suit against Lloyd's within the one-year limitation period presents an issue of law for the trial court to resolve.

III. Had Tonnon Timely Filed Suit Against Lloyd's Seeking To Enforce The Equitable Lien, The Suit Would Have Been Dismissed

¶ 10 Geer first contends that he possessed an equitable lien on the insurance proceeds of the Lloyd's policy by virtue of the covenant in the deed of trust requiring the Graffs, the mortgagors, to insure the subject property for the benefit of Geer, the mortgagee. Geer also argues that had Tonnon filed suit against Lloyd's within the one-year limitation period to enforce the equitable lien, Geer would have obtained a favorable judgment at trial.

¶ 11 The covenant in the deed of trust executed by the Graffs raises a question of fact as to whether Geer possessed an equitable lien on the proceeds of the Lloyd's insurance policy. However, even if Geer had an equitable lien on the policy proceeds, the existence of the equitable lien is not sufficient to withstand Tonnon's motion for summary judgment. To demonstrate that Tonnon's failure to timely file suit against Lloyd's based upon an equitable lien theory was the cause in fact of Geer's claimed damages, Geer must also prove that he had a cause of action to sue Lloyd's directly to enforce the equitable lien.

¶ 12 Geer asserts that Washington law provides a person who is not a named insured with a cause of action to...