Peeler v. Hughes & Luce

• Decision Date: 11 October 1993
• Docket Number: No. 05-92-01541-CV,05-92-01541-CV
• Citation: 868 S.W.2d 823
• Parties: Carol PEELER, Appellant, v. HUGHES & LUCE, and Darrell E. Jordan, Appellees.
• Court: Texas Court of Appeals

Page 823

868 S.W.2d 823

Carol PEELER, Appellant, v. HUGHES & LUCE, and Darrell E. Jordan, Appellees.

No. 05-92-01541-CV.

Court of Appeals of Texas,

Dallas.

Oct. 11, 1993.

Rehearing Denied Dec. 2, 1993.

Arnold Anderson Vickery, Houston, for appellant.

James E. Coleman Jr. and Marvin S. Sloman, Dallas, for appellees.

Before THOMAS, OVARD and MORRIS, JJ.

OPINION

OVARD, Justice.

This is a legal malpractice case. Appellant Carol Peeler claims that appellees, her former attorney Darrell Jordan and the Hughes & Luce law firm where Jordan is a partner, failed to inform her of an offer of immunity from prosecution while she was under investigation for federal offenses. She was subsequently indicted and convicted of aiding in the preparation of a fraudulent partnership tax return. She asserts that appellees' failure to convey the immunity offer to her caused her indictment and conviction, resulting in her injuries. Appellees moved for summary judgment contending, among other grounds, that appellant's own actions caused her injuries and that the judgment should be affirmed for policy reasons. The trial court granted summary judgment for appellees. The decisive issue is whether appellant's admitted criminal conduct, for which she pleaded guilty, was convicted, and sought no postconviction relief prior to the summary judgment hearing, proximately caused her injuries, to the exclusion of the alleged malpractice by appellees. For policy reasons set out below, we agree with the trial court that appellant's indictment and conviction were proximately caused by her actions and not by any acts or omissions of appellees. Consequently, we affirm the trial court's judgment.

FACTUAL AND PROCEDURAL BACKGROUND

Appellant was an officer with Hillcrest Equities, Inc., a corporation trading in securities, when she and other individuals came under federal criminal investigation by the IRS. Appellant hired appellees, specifically Darrell Jordan, to represent her and paid him a substantial retainer fee. Summary judgment evidence showed that an assistant United States Attorney in charge of the investigation telephoned Jordan and unequivocally offered transactional immunity from prosecution for appellant in exchange for her cooperation in the investigation. ¹

Jordan did not communicate any offer of immunity to appellant and did not respond to the assistant U.S. Attorney. Appellant alleges that Jordan did not inform her because he was being "loyal" to other defendants. ²

A federal grand jury indicted appellant and other Hillcrest principals for various offenses. Another suspect accepted immunity and provided the government information used to prosecute the others, including appellant.

Appellant pleaded guilty to count eighteen of a twenty-one count indictment against her. Count eighteen charged her with the offense of "aiding and assisting the filing of a false and fraudulent U.S. Partnership Return of Income for Byrd Investments." She signed a plea agreement admitting her guilt to count eighteen. She also admitted her guilt in open court and testified her plea of guilty was made freely and voluntarily. In addition, appellant admitted in a deposition that she was guilty of nineteen of the other counts of the indictment. She was assessed a probated sentence and a fine.

Appellant said she pleaded guilty on the advice of attorneys with Hughes & Luce. She learned of the alleged immunity offer three days after her guilty plea. She sued appellees for legal malpractice claiming that their failure to communicate the offer of immunity caused her to be indicted and convicted. She sought damages under theories of negligence, gross negligence, violation of the Deceptive Trade Practices-Consumer Protection Act (DTPA), ³ breach of contract, and breach of implied warranty.

Appellees moved for summary judgment on four grounds:

(a) Appellant would not have received immunity;

(b) The immunity offer was unauthorized and was not actually an offer (c) For policy and other reasons, appellant's own conduct, not appellees', was the proximate or producing cause of her indictment and conviction; and

(d) Appellant did not attempt to withdraw her plea or have her conviction set aside.

The judgment states that the trial court specifically overruled grounds (a) and (b) and specifically granted judgment for appellees on grounds (c) and (d). After the summary judgment, appellant filed a motion with the federal court to vacate its judgment on her plea.

Appellant contests the trial court's judgment only on the negligence, gross negligence, and DTPA claims. Specifically, she contends in eleven points of error that the trial court erred because (a) her conduct was not the sole proximate, superseding, or supervening cause of her indictment and conviction; (b) no Texas public policy prohibits her claim; (c) no elements of exhaustion of remedies or innocence are required; (d) the DTPA supports her claim; (e) postconviction relief was properly sought, though not required; and (f) the judgment violates the Equal Protection Clause, the Open Courts Provision, and the "outlawry" provision of the Texas Constitution. In their reply points, appellees urge us to consider the two additional grounds for summary judgment that the trial court specifically rejected.

SUMMARY JUDGMENT STANDARD OF REVIEW

This Court reviews this summary judgment record by applying the following standards:

(1) The movant for summary judgment has the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law.

(2) In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true.

(3) Every reasonable inference must be indulged in favor of the non-movant and any doubts resolved in its favor.

Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex.1985). For defendants, as movants, to prevail in the summary judgment, they must either disprove at least one necessary element of the plaintiff's theory of recovery or plead and conclusively establish each essential element of an affirmative defense thereby rebutting the plaintiff's cause of action. International Union UAW Local 119 v. Johnson Controls, Inc., 813 S.W.2d 558, 563 (Tex.App.-Dallas 1991, writ denied). A matter is conclusively established if ordinary minds cannot differ as to the conclusion to be drawn from the evidence. Triton Oil & Gas Corp. v. Marine Contractors & Supply, Inc., 644 S.W.2d 443, 446 (Tex.1982). The summary judgment for the defendant disposing of the entire case is proper only if, as a matter of law, plaintiff could not succeed upon any theories pleaded. See Delgado v. Burns, 656 S.W.2d 428, 429 (Tex.1983). Here, appellees sought to show that appellant's own actions caused any damages to her rather than any conduct on their part.

APPLICABLE LAW--CAUSATION

General Principles

In points of error four, five, six, and seven, appellant challenges the trial court's judgment on her tort claims to the extent that it finds her conduct, and not any actions or failure to act by Jordan, was the proximate cause of her indictment and conviction. In point eleven she contends the trial court's rulings were contrary to the law and policy of the DTPA because Jordan's failure to communicate the offer produced her injuries. Thus, we focus on the causation element.

Proximate cause

An attorney malpractice action can be based in negligence or gross negligence. Cosgrove v. Grimes, 774 S.W.2d 662, 664 (Tex.1989). The attorney is held to the standard of care that a reasonably prudent attorney would exercise. Id. Negligence claims consist of the following elements: (1) a duty owed to the plaintiff; (2) a breach of that duty; and (3) damages proximately caused by the breach. Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 525 (Tex.1990). To establish such a claim, the plaintiff must show the attorney's actions or failure to act were the proximate cause of his damages. See id.; El Chico Corp. v. Poole, 732 S.W.2d 306, 311 (Tex.1987). Proximate cause is legal causation and embraces two concepts: the cause-in-fact of an event and the foreseeability of the event. Both elements must be present to establish proximate causation. Farley v. M M Cattle Co., 529 S.W.2d 751, 755 (Tex.1975). There can be more than one proximate cause. Lear Siegler, Inc. v. Perez, 819 S.W.2d 470, 471 (Tex.1991); Wal-Mart Stores, Inc. v. Berry, 833 S.W.2d 587, 590 (Tex.App.--Texarkana 1992, no writ). The proximate cause of an injurious event is that which, "in a natural and continuous sequence, unbroken by any new and independent cause, produces the injury and without which the injury would not have occurred." Winograd v. Clear Lake City Water Auth., 811 S.W.2d 147, 156 (Tex.App.--Houston [1st Dist.] 1991, writ denied).

If a plaintiff can establish this causation, he may be able to collect both actual and, with additional proof, exemplary damages. Montfort v. Jeter, 567 S.W.2d 498, 500 (Tex.1978); Fillion v. Troy, 656 S.W.2d 912, 915 (Tex.App.--Houston [1st Dist.] 1983, writ ref'd n.r.e.). He may also be able to collect damages for mental anguish. Cosgrove, 774 S.W.2d at 666.

Producing cause

Causation is a necessary element of a claim under the DTPA. TEX.BUS. & COM.CODE ANN. § 17.50(a) (Vernon 1987). Under the DTPA, a plaintiff must show the malfeasance was the producing cause of his injuries. TEX.BUS. & COM.CODE ANN. § 17.50 (Vernon 1987). Producing cause has been defined as "an efficient, exciting or contributing cause, which in a natural and continuous sequence, [produced] the event complained of. There can be more than one producing cause of an event." Rourke v. Garza, 511 S.W.2d 331, 339 (Tex.Civ.App.-Houston [1st Dist.] 1974), aff'd, 530 S.W.2d 794 (Tex.1975). Producing cause is sometimes referred to as factual causation. Dubow v. Dragon, 746 S.W.2d 857, 860 (Tex.App.--Dallas 1988, no writ). Producing...