Innovative Images, LLC v. Summerville
Citation | 309 Ga. 675,848 S.E.2d 75 |
Decision Date | 08 September 2020 |
Docket Number | S19G1026 |
Parties | INNOVATIVE IMAGES, LLC v. James Darren SUMMERVILLE et al. |
Court | Supreme Court of Georgia |
Warren R. Hinds, for appellant.
Hawkins Parnell & Young, Kathryn S. Whitlock, Kelli K. Steele, for appellees.
Caleb F. Walker ; Taulbee Rushing Snipes Marsh & Hodgin, Daniel B. Snipes, amici curiae.
Innovative Images, LLC ("Innovative"), sued its former attorney James Darren Summerville, Summerville Moore, P.C., and The Summerville Firm, LLC (collectively, the "Summerville Defendants"), for legal malpractice. In response, the Summerville Defendants filed a motion to dismiss the suit and to compel arbitration in accordance with the parties’ engagement agreement, which included a clause mandating arbitration for any dispute arising under the agreement. The trial court denied the motion, ruling that the arbitration clause was "unconscionable" and thus unenforceable because it had been entered into in violation of Rule 1.4 (b) of the Georgia Rules of Professional Conduct ("GRPC") for attorneys found in Georgia Bar Rule 4-102 (d). In Division 1 of its opinion in Summerville v. Innovative Images , 349 Ga. App. 592, 826 S.E.2d 391 (2019), the Court of Appeals reversed that ruling, holding that the arbitration clause was not void as against public policy or unconscionable. See id. at 597-598, 826 S.E.2d 391. We granted Innovative's petition for certiorari to review the Court of Appeals's holding on this issue.
As explained below, we conclude that regardless of whether Summerville violated GRPC Rule 1.4 (b) by entering into the mandatory arbitration clause in the engagement agreement without first apprising Innovative of the advantages and disadvantages of arbitration – an issue which we need not address – the clause is not void as against public policy because Innovative does not argue and no court has held that such an arbitration clause may never lawfully be included in an attorney-client contract. For similar reasons, the arbitration clause is not substantively unconscionable, and on the limited record before us, Innovative has not shown that the clause was procedurally unconscionable. Accordingly, we affirm the judgment of the Court of Appeals.1
As summarized by the Court of Appeals, the record shows the following:
Summerville , 349 Ga. App. at 593-595, 826 S.E.2d 391 (footnotes omitted).
The trial court issued a certificate of immediate review, and the Court of Appeals granted the Summerville Defendants’ application for interlocutory appeal. In its subsequent opinion reversing the trial court's order, the Court of Appeals's analysis bounced between case law and concepts related to whether a contract is unconscionable and case law and concepts related to whether a contract is void as against public policy. See Summerville , 349 Ga. App. at 595-598, 826 S.E.2d 391. The court ultimately "decline[d] to adopt a blanket rule that an arbitration clause in an attorney-client contract is unconscionable and against public policy if the attorney did not explain the potential disadvantages of the clause to his prospective client before execution of the contract." Id. at 597, 826 S.E.2d 391. The Court of Appeals also noted that this Court "has not addressed whether ABA Formal Opinion 02-425 should be adopted as the proper interpretation of [GRPC] Rule 1.4 (b)," and "for these combined reasons," concluded "that the trial court erred in finding the Arbitration Clause unconscionable and in denying the Summerville Defendants’ Motion to Compel Arbitration." Id. at 598, 826 S.E.2d 391.
Innovative petitioned for a writ of certiorari, which this Court granted, directing the parties to address two questions:
We have now determined that we need not answer the first question to answer the second question and decide this case.
We consider first the question of whether an attorney violates the GRPC by entering into an agreement with a client mandating arbitration of legal malpractice claims without first fully apprising the client of the advantages and disadvantages of arbitration. As it did in the courts below, Innovative argues that because GRPC Rule 1.4 (b) is identical to ABA Model Rule of Professional Conduct 1.4 (b), we should adopt the reasoning in ABA Formal Opinion 02-425 and conclude that Summerville violated the GRPC by entering into the Arbitration Clause without first apprising Innovative of the potential consequences of arbitration. Innovative also points to several other states that have relied on the reasoning in ABA Formal Opinion 02-425 to similarly interpret their respective rules of professional conduct.
Both GRPC Rule 1.4 (b) and ABA Model Rule 1.4 (b) say, "A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation." In 2002, the ABA's Standing Committee on Ethics and Professional Responsibility issued Formal Opinion 02-425, which concluded, relying principally on ABA Model Rule 1.4 (b), that lawyers must fully apprise their clients of the advantages and disadvantages of arbitration before including a provision in a retainer agreement mandating arbitration of legal malpractice claims. The ABA Committee reasoned that "[b]ecause the attorney-client relationship involves professional and fiduciary duties on the part of the lawyer that generally are not present in other relationships, the retainer contract may be subject to special oversight and review" (footnotes omitted), and that the requirement that a lawyer explain to the client the type of arbitration clause at issue in this case derives from those fiduciary duties.2 Courts in several states have followed the reasoning of ABA Formal Opinion 02-425, interpreting their own rules of professional conduct regarding attorney-client relationships to require the same sort of advice about prospective arbitration clauses. See, e.g., Snow v. Bernstein, Shur, Sawyer & Nelson, P.A. , 176 A.3d 729, 737 (Me. 2017) ; Castillo v. Arrieta , 368 P.3d 1249, 1257 (N.M. Ct. App. 2016) ; Hodges v. Reasonover , 103 So.3d 1069, 1077 (La. 2012).3
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