Grayson v. Wofsey, Rosen, Kweskin and Kuriansky

Decision Date23 August 1994
Docket NumberNo. 14889,14889
Citation231 Conn. 168,646 A.2d 195
CourtConnecticut Supreme Court
Parties, 63 USLW 2198 Elyn K. GRAYSON v. WOFSEY, ROSEN, KWESKIN AND KURIANSKY et al.

William F. Gallagher, with whom, on the brief, were Elizabeth A. Gallagher, New Haven, and Robert W. Lotty, Fairfield, for appellants (defendants).

Sue L. Wise, New Haven, with whom was Edward N. Lerner, Fairfield, for appellee (plaintiff).

Before PETERS, C.J., and CALLAHAN, BORDEN, PALMER and O'CONNELL, JJ.

PALMER, Associate Justice.

The principal issue raised by this appeal is whether a client who has agreed to the settlement of a marital dissolution action on the advice of his or her attorney may then recover against the attorney for the negligent handling of her case. The plaintiff, Elyn K. Grayson, brought this action against the defendants, Edward M. Kweskin, Emanuel Margolis, and their law firm, Wofsey, Rosen, Kweskin and Kuriansky, alleging that they had committed legal malpractice in the preparation and settlement of her dissolution action. 1 After trial, a jury returned a verdict in the amount of $1,500,000 against the defendants. The trial court, Ballen, J., rendered judgment for the plaintiff in accordance with the jury verdict, and this appeal followed. 2 The defendants claim that: (1) the plaintiff failed to establish, as a matter of law, that she was entitled to a recovery against them; (2) the evidence was insufficient to support the jury's verdict; (3) the trial court's rulings on certain evidentiary issues constituted an abuse of discretion; and (4) the trial court's instructions to the jury were improper. We affirm the judgment of the trial court.

The relevant facts and procedural history are as follows. In 1981, Arthur I. Grayson (husband) brought an action against the plaintiff for the dissolution of their marriage. On May 28, 1981, the third day of the dissolution trial before Hon. William L. Tierney, Jr., state trial referee, the plaintiff, on the advice of the defendants, agreed to a settlement of the case that had been negotiated by the defendants and counsel for her husband. The agreement provided, inter alia, that the plaintiff would receive lump sum alimony of $150,000 and periodic alimony of $12,000 per year. Judge Tierney found that the agreement was fair and reasonable and, accordingly, rendered a judgment of dissolution incorporating the agreement. 3

On September 23, 1981, the plaintiff moved to open the judgment on the ground that the settlement agreement had been based on a fraudulent affidavit submitted to the court and to the plaintiff by her husband. 4 The trial court, Jacobson, J., 5 denied the plaintiff's motion to open the judgment and the plaintiff appealed to the Appellate Court, which affirmed the judgment. Grayson v. Grayson, 4 Conn.App. 275, 494 A.2d 576 (1985), appeal dismissed, 202 Conn. 221, 520 A.2d 225 (1987).

The plaintiff also brought this legal malpractice action against the defendants. Her complaint alleged that she had agreed to the settlement of the dissolution action on the advice of the defendants who, she claimed, had failed properly to prepare her case. The plaintiff further alleged that as a result of the defendants' negligence, she had agreed to a settlement that "was not reflective of her legal entitlement" and that she had "thereby sustained an actual economic loss."

At trial, the plaintiff introduced evidence concerning her thirty year marriage, its breakdown due to her husband's affair with another woman, and the couple's financial circumstances. After a detailed recounting of the history of the divorce litigation, the plaintiff presented the testimony of two expert witnesses, Thomas Hupp, a certified public accountant, and Donald Cantor, an attorney who specialized in the practice of family law.

Hupp testified that the defendants had failed properly to value the marital estate and, in particular, the husband's various business interests. Cantor gave his opinion that the defendants' representation of the plaintiff fell below the standard of care required of attorneys in marital dissolution cases. Specifically, Cantor testified that: (1) the defendants had not conducted an adequate investigation and evaluation of the husband's business interests and assets; (2) they had not properly prepared for trial; (3) as a result of the defendants' negligence, the plaintiff had agreed to a distribution of the marital estate and an alimony award that were not fair and equitable under the law; see General Statutes §§ 46b-81(c) 6 and 46b-82; 7 and (4) the plaintiff would have received a greater distribution of the marital estate and additional alimony had she been competently represented. The trial court, Ballen, J., denied the defendants' motion for a directed verdict at the close of the plaintiff's case.

In their case in defense, the defendants testified concerning their handling of the plaintiff's case, and they also presented the expert testimony of two attorneys, James Stapleton and James Greenfield. These experts expressed the opinion that the defendants' representation of the plaintiff comported with the standard of care required of attorneys conducting dissolution litigation.

The jury returned a verdict for the plaintiff in the amount of $1,500,000. The defendants thereafter filed motions to set aside the verdict and for judgment notwithstanding the verdict. The trial court denied those motions and rendered judgment in accordance with the verdict. Additional facts are set forth as relevant.

I

The defendants first claim that the trial court improperly denied their motions for a directed verdict and for judgment notwithstanding the verdict on the ground that the plaintiff was barred from recovering against them, as a matter of law, due to her agreement to settle the marital dissolution action. We conclude that the plaintiff was not so barred.

The defendants urge us to adopt a common law rule whereby an attorney may not be held liable for negligently advising a client to enter into a settlement agreement. See Muhammad v. Strassburger, McKenna, Messer, Shilobod & Gutnick, 526 Pa. 541, 587 A.2d 1346 (1991). They argue that, as a matter of public policy, an attorney should not be held accountable for improperly advising a client to settle a case unless that advice is the product of fraudulent or egregious misconduct by the attorney. See id. The defendants contend that the adoption of such a rule is necessary in order to promote settlements, to protect the integrity of stipulated judgments, and to avoid the inevitable flood of litigation that they claim will otherwise result. They claim that such a rule is particularly appropriate if, as here, the court has reviewed and approved the settlement agreement.

We have long recognized that the pretrial settlement of claims is to be encouraged because, in the vast number of cases, an amicable resolution of the dispute is in the best interests of all concerned. "The efficient administration of the courts is subserved by the ending of disputes without the delay and expense of a trial, and the philosophy or ideal of justice is served in the amicable solution of controversies." Krattenstein v. G. Fox & Co., 155 Conn. 609, 614, 236 A.2d 466 (1967). We have also acknowledged that, with appropriate judicial supervision, the "private settlement of the financial affairs of estranged marital partners is a goal that courts should support rather than undermine." Hayes v. Beresford, 184 Conn. 558, 568, 440 A.2d 224 (1981); Baker v. Baker, 187 Conn. 315, 321-22, 445 A.2d 912 (1982). At a time when our courts confront an unprecedented volume of litigation, we reaffirm our strong support for the implementation of policies and procedures that encourage fair and amicable pretrial settlements.

We reject the invitation of the defendants, however, to adopt a rule that promotes the finality of settlements and judgments at the expense of a client who, in reasonable reliance on the advice of his or her attorney, agrees to a settlement only to discover that the attorney had failed to exercise the degree of skill and learning required of attorneys in the circumstances. "Although we encourage settlements, we recognize that litigants rely heavily on the professional advice of counsel when they decide whether to accept or reject offers of settlement, and we insist that the lawyers of our state advise clients with respect to settlements with the same skill, knowledge, and diligence with which they pursue all other legal tasks." Ziegelheim v. Apollo, 128 N.J. 250, 263, 607 A.2d 1298 (1992). Therefore, when it has been established that an attorney, in advising a client concerning the settlement of an action, has failed to "exercise that degree of skill and learning commonly applied under all the circumstances in the community by the average prudent reputable member of the [legal] profession ... [and that conduct has] result[ed in] injury, loss, or damage to the [client]"; (internal quotation marks omitted) Davis v. Margolis, 215 Conn. 408, 415, 576 A.2d 489 (1990); the client is entitled to a recovery against the attorney. Accordingly, like the majority of courts that have addressed this issue, we decline to adopt a rule that insulates attorneys from exposure to malpractice claims arising from their negligence in settled cases if the attorney's conduct has damaged the client. See Edmondson v. Dressman, 469 So.2d 571 (Ala.1985); Bill Branch Chevrolet, Inc. v. Burnett, 555 So.2d 455 (Fla.App.1990); McCarthy v. Pedersen & Houpt, 250 Ill.App.3d 166, 190 Ill.Dec. 228, 621 N.E.2d 97 (1993); Braud v. New England Ins. Co., 534 So.2d 13 (La.App.1988); Fishman v. Brooks, 396 Mass. 643, 487 N.E.2d 1377 (1986); Lowman v. Karp, 190 Mich.App. 448, 476 N.W.2d 428 (1991); Ziegelheim v. Apollo, supra, 128 N.J. 250, 607 A.2d 1298; Cohen v. Lipsig, 92 A.D.2d 536, 459 N.Y.S.2d 98 (1983); but see Muhammad v. Strassburger, McKenna, Messer,...

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