Lawrence v. Hutchinson

• Decision Date: 05 February 2009
• Docket Number: No. 34775.,34775.
• Citation: 204 P.3d 532
• Parties: Frederick Earl LAWRENCE, and Sam Hopkins, Trustee in Bankruptcy, Plaintiff-Appellant-Cross Respondents, v. Keith E. HUTCHINSON, Defendant-Respondent-Cross Appellant.
• Court: Idaho Court of Appeals

204 P.3d 532

Frederick Earl LAWRENCE, and Sam Hopkins, Trustee in Bankruptcy, Plaintiff-Appellant-Cross Respondents, v. Keith E. HUTCHINSON, Defendant-Respondent-Cross Appellant.

No. 34775.

Court of Appeals of Idaho.

February 5, 2009.

Lowell N. Hawkes, Chtd., Pocatello, for appellant.

Benoit, Alexander, Harwood High & Valdez, L.L.P., Ketchum, for respondent. Robert M. Harwood argued.

SCHWARTZMAN, Judge Pro Tem.

Frederick Earl Lawrence appeals from the denial of his motion for summary judgment and the grant of Keith E. Hutchinson's motion for summary judgment. Hutchinson cross-appeals from the district court's denial of his motion for attorney fees. We affirm.

I. BACKGROUND

This appeal represents the culmination of more than ten years of litigation. In July 1996, Frederick Earl Lawrence and his wife were involved in an automobile accident. Although the other driver's insurance company paid for the damages to their vehicle, it did not pay for Lawrence's medical bills. Lawrence's wife reached a settlement with the insurance company regarding her own medical bills. Just before the statute of limitations expired, Lawrence hired Eric R. Clark to represent him in a personal injury suit against the driver of the other car. The complaint was filed, but named the owners of the vehicle as shown on insurance documents, even though it was the teenage daughter of the owners who was driving the car. Nearly two years later, Keith E. Hutchinson assumed representation of Lawrence after Clark left their firm. During the intervening time, Lawrence and his wife filed for bankruptcy due to their unpaid medical bills. Hutchinson soon withdrew from the case. It was only after Hutchinson's withdrawal that Lawrence discovered the teenage driver was not named in the suit. Unable to hire another attorney to represent him, Lawrence failed at his pro se attempt to fight summary judgment and his personal injury case was dismissed.

Lawrence, represented by Lowell N. Hawkes, brought a legal malpractice claim (Lawrence I) against both Clark and Hutchinson, seeking damages for their negligent representation of him in the personal injury case. Clark and Hutchinson obtained separate counsel, with Robert M. Harwood representing Hutchinson. Also involved in Lawrence I were the appointed Trustee in the bankruptcy proceeding; an attorney for the Trustee; and Bradley E. Rice, Lawrence's attorney in the bankruptcy proceeding. Rice had authority from Lawrence, the Trustee, and Hawkes to negotiate a settlement in the malpractice action that would be approved by the bankruptcy court. Rice informed Harwood of this arrangement and indicated that he expected a standard release would be executed once a settlement was reached. Harwood was given authority by Clark, his attorney, and Hutchinson to negotiate a settlement. On September 13, 2004, Rice and Harwood spoke by phone and agreed that Clark and Hutchinson would jointly pay Lawrence $37,500 to settle his malpractice claim against them. That same day, Harwood sent two letters to Rice and the other participants indicating that they had reached an agreement to settle for the stated amount.¹ The letters also indicated that a proposed joint release would be forthcoming, including a confidentiality provision to the extent allowed by the bankruptcy proceedings. Due to the upcoming trial date and the date scheduled for the bankruptcy court to approve the proposed settlement, Harwood filed a motion for continuance in the trial court and an affidavit in support thereof. In his affidavit, Harwood informed the court that the parties had agreed to a joint settlement figure of $37,500. The affidavit concluded:

Given that fact that a settlement, in principle, has been reached with the parties, the Defendant Hutchinson feels that a trial would be an unnecessary waste of time and money.

The district court vacated the trial date, but did not dismiss the case. Both Lawrence and Hutchinson proposed release language, with no agreement as to the requirements for the final release. Sometime in November the parties discovered that Lawrence had previously made a broad formal assignment of all his claims to a medical provider, potentially exposing Hutchinson and Clark to further liability. Hutchinson was adamant that the release include a confidentiality clause and an indemnity clause, and while Hawkes proposed language for these clauses, the language was not satisfactory to Hutchinson.

In March, 2005, the district court held a status conference on the case. Hawkes did not appear at the hearing; another attorney appeared on behalf of Lawrence as a favor to Hawkes. The substitute attorney represented that the case was settled, but the parties could not agree on release language. The district judge expressed his belief that there was no settlement if they could not agree on the release. Lawrence asked the court not to dismiss the case at that time, but to give the parties more time to finalize the details. The district court issued an order to show cause why the case should not be dismissed. At the subsequent hearing in June, Hawkes represented that he had no objections to Harwood's request for a new trial date and explained he did not seek a date sooner because he was trying, in good faith, to work through their differences. The court set a new trial date rather than dismiss the case outright. Several months later, Hutchinson moved for summary judgment. At the hearing in October of 2005, Hawkes argued for the first time that an enforceable settlement agreement had been reached and that it should be enforced against Hutchinson. However, Hawkes did not amend the original malpractice complaint to seek enforcement of a settlement agreement, and the court decided that it lacked jurisdiction to grant such relief without an amendment. The district judge stated:

It seems to me that there are tons of factual questions with respect to whether there was or wasn't an agreement, what the terms of the agreement were. It is clear to me that you gentlemen reached an agreement on the numbers. That is absolutely clear to me. It is also clear to me that it is customary in every case that I've ever been involved with for a case to conclude with the execution of some form of reasonable release document.

. . . .

I'm not in a position to sit here and dictate to you what a standard release is. Frankly, there is no such thing. There are standard forms that different people use, but I venture to say that there are about as many settlement agreements and release documents as there are lawyers and lawsuits and they come in all shapes and sizes and I'm not in a position to dictate what the terms of your agreement are or even if you have one.

The district court dismissed Lawrence's malpractice claim against Hutchinson without prejudice, so that Lawrence could file a new action to enforce the purported settlement agreement. The claim against Clark was continued for trial.

Lawrence did not appeal the district court's order. Instead, he first attempted to enforce the agreement in bankruptcy court, but the judge exercised his discretion pursuant to 28 U.S.C. § 1334(c)(1) and declined to rule on the issue out of respect for the state courts. The parties continued to negotiate, and Clark eventually agreed to pay $24,000 to settle the claim against him, using a release prepared by Hawkes. Although Hawkes and Harwood continued to negotiate, they could not reach an agreement on release language, so Lawrence filed a complaint for damages arising out of the breach of the purported settlement agreement, instigating the present action. Hutchinson answered the complaint, and Lawrence filed a motion for summary judgment. Hutchinson filed a cross-motion for summary judgment. After reviewing the prior proceedings in Lawrence I and the correspondence related to settlement, the district court ruled in favor of Hutchinson. The district court found that the confidentiality and indemnity provisions were material to the agreement, were not agreed upon, and therefore there was no enforceable agreement between Lawrence and Hutchinson. The court granted Hutchinson's motion for summary judgment and dismissed the case.

Hutchinson brought a motion for costs and attorney fees pursuant to Idaho Rule of Civil Procedure 54(d), and Idaho Code § 12-120. Lawrence objected on the basis that the statutory requirements of that section had not been met. Fees were ultimately denied because damages of $25,000 or less were not pleaded by either party. Lawrence appeals from the district court's denial of his motion for summary judgment and the granting of Hutchinson's motion for summary judgment. Hutchinson cross-appeals the denial of attorney fees under I.C. § 12-120(1).

II. DISCUSSION

A. Cross-Motions for Summary Judgment

Both Lawrence and Hutchinson moved for summary judgment. We first note that summary judgment under I.R.C.P. 56(c) is proper only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. On appeal, we exercise free review in determining whether a genuine issue of material fact exists and whether the moving party is entitled to judgment as a matter of law. Edwards v. Conchemco, Inc., 111 Idaho 851, 852, 727 P.2d 1279, 1280 (Ct.App.1986). The fact that the parties have filed cross-motions for summary judgment does not change the applicable standard of review, and does not in and of itself establish that there is no genuine issue of material fact.² This Court must evaluate each party's motion on its own merits. Intermountain Eye & Laser Ctrs., P.L.L.C. v. Miller, 142 Idaho 218, 222, 127 P.3d 121, 125 (2005); Shawver v. Huckleberry Estates, L.L.C., 140 Idaho 354, 360, 93 P.3d 685, 691 (2004); Intermountain Forest Mgmt., Inc. v. Louisiana Pac. Corp., 136 Idaho 233, 235, 31 P.3d 921, 923 (2001); Stafford v. Klosterman, 134 Idaho 205, 206, 998 P.2d 1118, 1119 (2000); Kromrei v. AID Ins. Co., 110 Idaho 549, 551, ...