Leavitt v. Mizner

• Decision Date: 13 February 1989
• Citation: 533 N.E.2d 1334,404 Mass. 81
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 1334

533 N.E.2d 1334

404 Mass. 81

Edward E. LEAVITT et al. ¹ v. Judith H. MIZNER et al. ² Supreme Judicial Court of Massachusetts Suffolk.

Argued Oct. 5, 1988.

Decided Feb. 13, 1989.

Arthur Goldstein, Worchester, for plaintiffs.

Regina E. Roman (Edward J. Barshak, Boston, with her) for Alan M. Dershowitz.

William E. Bernstein (C. Donald Briggs, III, Worchester, with him) for Johanna D. Drooz Yoffie.

Andrew Good, Boston, for Judith A. Mizner & another, submitted a brief.

Before HENNESSEY, C.J., and WILKINS, LIACOS, LYNCH and O'CONNOR, JJ.

O'CONNOR, Justice.

The plaintiffs commenced this case by filing a complaint containing fourteen counts, alleging malpractice and violation of G.L. c. 93A (1986 ed.), against five attorneys and two law firms. The defendant Yoffie filed a motion for summary judgment and the other defendants filed motions which the judge who ruled on them treated as motions for summary judgment. The plaintiffs filed several motions for summary judgment as well. The judge denied the plaintiffs' motions and allowed the motions of the defendants Attorneys Keefe and Israel, and the law firm Hale and Dorr. This appeal does not involve those parts of the judge's order, nor does it involve those defendants. The judge substantially denied the summary judgment motions filed by the defendants Attorneys Mizner, Dershowitz, and Yoffie, and the law firm Silverglate, Gertner, Baker, Fine & Good. Those defendants have appealed.

The portion of the plaintiffs' complaint that survived summary judgment and which is the subject of this appeal consists of six counts alleging legal malpractice. The thrust of the six counts is that the defendants named therein negligently represented the plaintiff Regina Leavitt in connection with a motion for a new trial filed on her behalf after she had been convicted of perjury. That motion was heard and denied by the judge who had presided at the perjury trial. The plaintiffs Edward Leavitt, who is Regina Leavitt's husband, and Hospital Liquidating, Inc., which is a corporation wholly owned and controlled by the Leavitts, seek derivative damages allegedly resulting from the defendants' improper representation of Regina Leavitt in connection with the new trial motion. The defendants' sole argument is that they have established for summary judgment purposes that there was no causal connection between any alleged malpractice on their part and the denial of Regina Leavitt's motion for a new trial, and that, therefore, their summary judgment motions should have been allowed. The defendants make no argument with respect to the claims of Edward Leavitt and Hospital Liquidating, Inc., separate from their argument with respect to the claim made by Regina Leavitt. For example, they do not argue that loss of consortium or consequential damages are not recoverable in a legal malpractice action.

The defendants Mizner, Dershowitz, and Silverglate, Gertner, Baker, Fine & Good filed a petition in the Appeals Court under G.L. c. 231, § 118, first par. (1986 ed.), seeking relief from the order denying them summary judgment on the six counts and in the alternative leave for an interlocutory appeal from the denial of their motions for summary judgment. After a single justice granted their petition for leave to appeal, those defendants filed their appeal. The defendant Yoffie then was granted leave to join the interlocutory appeal and she did so. The plaintiffs appealed the single justice's grant of the right of interlocutory appeal to the defendants. The several appeals were consolidated for review, and we transferred them to this court on our own motion. Because, in any event, we must decide in connection with the defendants' appeal whether the denial of a motion for summary judgment is reversible before trial, we treat the plaintiffs' appeal as proper even though the appeal was entered as to this interlocutory matter without a grant of leave to appeal under G.L. c. 231, § 118. We now affirm the order of the single justice granting the defendants leave to appeal. We reverse the judge's order denying summary judgment to the defendants on counts VI, VII, IX, X, XII, and XIII, and remand for the entry of judgment for the defendants on those counts.

The following background information is relevant. From 1975 to 1982, Hospital Equipment Services, Inc., which, prior to the commencement of this action, became Hospital Liquidating, Inc., supplied medical equipment, oxygen, and supplies to hospitals, nursing homes, and individuals throughout the Commonwealth. Hospital Equipment Services, Inc., was a provider under the Medicaid program of the Massachusetts Department of Public Welfare and the Federal Medicare program. In 1980, the Attorney General's Medicaid fraud control unit began an investigation of Hospital Equipment Services, Inc., and as a result of that investigation a grand jury indicted the company for larceny. The plaintiffs Edward Leavitt and Regina Leavitt also were indicted for larceny. Regina Leavitt was indicted for perjury and contempt as well. In addition, separate indictments were issued by a second grand jury against Regina Leavitt for false statements and written perjury.

The indictments against Regina Leavitt for perjury and contempt before the grand jury were tried to a jury. Regina Leavitt was convicted of both offenses. On appeal, the Appeals Court reversed the contempt conviction but affirmed the conviction for perjury. Commonwealth v. Leavitt, 17 Mass.App.Ct. 585, 460 N.E.2d 1060, cert. denied, 469 U.S. 835, 105 S.Ct. 130, 83 L.Ed.2d 71 (1984), S.C., 21 Mass.App.Ct. 84 (1985). Subsequently, both Leavitts and Hospital Equipment Services, Inc., pleaded guilty to larceny. The charges against Regina Leavitt of written perjury and false statements were filed without a change of plea.

In affirming Regina Leavitt's perjury conviction, the Appeals Court described the perjury case this way: "Perjury, as alleged by the Commonwealth, occurred when Leavitt, while testifying before the grand jury on two different occasions, denied the existence of all but isolated closed ledger cards at the time she was served with the grand jury's subpoena. More particularly, she said of the closed ledger cards: 'We dumped them.' Evidence was adduced by the Commonwealth at trial from which the jury could have found that Leavitt directed destruction of inculpatory closed ledger cards after she had received the subpoena from the grand jury.

"The focus of the grand jury's investigation was the receipt and retention by [Hospital Equipment Services, Inc.] of excess payments for equipment sold or leased. To that inquiry the closed ledger cards were highly relevant. As to each patient account, [Hospital Equipment Services, Inc.] set up a ledger card on which charges and receipts were entered. If, as happened, a duplicate or excess payment was received for the account of a patient (generally from a third-party payor, such as Medicaid), the overpayment would show on the patient's ledger card as a credit balance. Former bookkeepers at [Hospital Equipment Services, Inc.] testified that they had been, with some frequency, directed by Leavitt to write off credit balances on accounts which had become inactive; i.e., [Hospital Equipment Services, Inc.] would pocket the overpayments. It was the practice to indicate the closing of an individual account by drawing a double line and 'zeroing out' the balance by writing off a debit or credit as the case might be. Thus, the closed ledger cards would display more prominently than any other record the writing off of a credit balance created by an excess payment." 17 Mass.App.Ct. at 587, 460 N.E.2d 1060.

At the perjury trial, a current ledger card pertaining to a patient named Deborah Lynn Baker was introduced by the Commonwealth to corroborate the testimony of the corporation's bookkeepers that it was that company's practice to keep ledger cards after the accounts were closed. The Baker card showed the receipt of two payments from Medicaid of $660.24 each, and the purchase of one wheelchair for $660.24, leaving a credit balance of $660.24 which was then "zeroed out" through an entry that said, "balance written off." The card also showed that the account was reopened when a later service was provided to Deborah Lynn Baker, permitting the inference that closed cards were not regularly thrown away. The card also corroborated the bookkeepers' testimony about how Hospital Equipment Services, Inc., accounted for credit balances.

After the Appeals Court had affirmed Regina Leavitt's perjury conviction, Mizner, who was an employee of Silverglate, Gertner, Baker, Fine & Good, and Dershowitz filed a motion for a new trial. The plaintiffs claim that malpractice occurred in connection with this motion. The motion was grounded on a computer printout which had been obtained from the Department of Public Welfare after the perjury trial. The motion alleged that the printout had been suppressed by the prosecution and that it was newly discovered evidence. After the motion for a new trial was filed, but before it was heard, Regina Leavitt informed Dershowitz and Mizner that, because the computer printout showed two separate prior approvals by the Department of Public Welfare of wheelchairs for Deborah Lynn Baker, Hospital Equipment Services, Inc., must have provided two wheelchairs. She concluded that the Baker card did not show an improper double billing but instead simply showed a bookkeeping error.

Regina Leavitt informed Dershowitz and Mizner that she could obtain an affidavit from Lester Stallsmith, an employee at the Irving A. Glavin Regional Center where Deborah Lynn Baker resided, to the effect that Baker had received two wheelchairs. Regina Leavitt, accompanied by the defendant Yoffie, who is an attorney and a notary public, went to the Glavin Center and obtained the following statement from Stallsmith: "The E & J chair, serial # 1796540 is here at Glavin...