Plattner v. State Farm Mut. Auto. Ins. Co.
| Decision Date | 28 May 1991 |
| Docket Number | CA-CV,No. 1,1 |
| Citation | 168 Ariz. 311,812 P.2d 1129 |
| Parties | Richard PLATTNER, Plaintiff-Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois corporation, Defendant-Appellee. 89-091. |
| Court | Arizona Court of Appeals |
This case raises the issue of whether an attorney can recover against an opposing party for interference with that attorney's relationship with his client, and whether the facts presented by the attorney here were sufficient to survive the opposing party's motion for summary judgment.
The plaintiff/appellant, Richard Plattner, (Plattner) appeals from the trial court's order granting summary judgment and attorneys' fees in favor of defendant/appellee, State Farm Mutual Automobile Insurance Company (State Farm) in this action for intentional interference with a contractual relation.
Plattner, an attorney, was retained by Sharon and Louis Malloque (Malloques) to pursue a claim against State Farm for medical payments. Plattner filed a suit alleging breach of contract and tort bad faith. State Farm later decided to pay the balance of the medical benefits under the policy. Plattner refused to accept the payment because he believed that State Farm intended the payment to settle the entire lawsuit including the bad faith claim.
Less than three weeks before the scheduled trial date, discovery was closed. At this time, State Farm had not yet deposed either the Malloques or their expert witness, nor had State Farm designated an expert of its own. State Farm then asserted in a letter to Plattner that the earlier offer to pay all insurance benefits had been unconditional. Earlier, State Farm's attorney had written to Plattner suggesting that he should consider whether he could continue representing the Malloques if he intended to be a witness in the case.
Shortly thereafter, Plattner withdrew as counsel for the Malloques in order to testify that in his view the nature of the prior offer was conditional. Thus, the trial was delayed and discovery was re-opened. State Farm then deposed the Malloques and their expert, as well as adding an expert of its own. Fourteen months later, Mr. Malloque, having been stricken with cancer in the interim and fearful of dying before the case concluded, reached a settlement of $40,000. Plattner then filed this suit. The trial court first denied State Farm's Motion to Dismiss made pursuant to Rule 12(b)(6), Arizona Rules of Civil Procedure, and then granted State Farm's Motion for Summary Judgment without elaboration. Plattner then filed this appeal.
This dispute originated in an insurance claim filed by Sharon Malloque. Malloque was involved in a car accident in 1984. A few months later, she filed a claim with her insurer, State Farm, alleging that she had developed further symptoms stemming from injuries received in the accident. After having the medical evidence evaluated by an independent medical expert and an independent evaluation team, State Farm accepted the claim but agreed to pay only part of the treatment costs. Displeased with this result, Malloque and her husband retained attorney Richard Plattner to pursue their claim.
On November 29, 1984, Plattner filed a complaint on behalf of the Malloques against State Farm, alleging breach of contract and bad faith based on State Farm's decision not to disburse the entire medical benefits amount. After Plattner had taken the medical expert's deposition, State Farm changed its position. Ralph Hunsaker, State Farm's attorney, wrote to Plattner, enclosing a check for the remainder of Malloque's medical benefits under the policy. The letter stated:
I am writing to inform you that State Farm has authorized me to offer to pay the medical pay coverage in this case, up to and including the $5,000 coverage, less $843 already paid under that coverage. If you and your client will let me know your wishes in this regard we can conclude this litigation.
Two days later, Neil Swiebel, State Farm's claim manager, wrote to Plattner:
Reference to Mr. Hunsaker's letter of March 19, 1985, we are pleased to enclose herewith our draft # 720 132 Q in the amount of $4,157.00, representing the balance of the available amount under insured's Medical Payment Coverage.
The draft is made out to insured driver Malloque. Thank you for your cooperation.
No release was enclosed in the letter.
Four days later, Plattner telephoned Hunsaker apparently to clarify orally State Farm's intent in tendering the check. Plattner alleges that he called Hunsaker and asked him whether State Farm meant the $4,157.00 check as a "no-strings" offer, that is, as resolution of the medical claims coverage solely, or as an offer conditioned on Malloques' dismissal of the entire lawsuit, including the bad faith claim. Hunsaker apparently stated that he did not know State Farm's intent and told Plattner to call Swiebel. Plattner did so. The substance of this conversation is disputed. Plattner alleges that Swiebel informed him that State Farm intended the payment to settle the entire lawsuit. State Farm contends that Swiebel stated that State Farm hoped the medical payment would conclude the litigation, but did not condition the payment of the benefits on Malloques' agreeing to settle the bad faith claim. This dispute formed the basis of the Malloques' second potential claim for bad faith.
In any event, Plattner did not cash the check, but kept it in his file. On March 25, 1985, he wrote Hunsaker.
Thank you for your recent offer on behalf of State Farm to pay the special damages in the above referenced case. However, I think any settlement discussion will also need to take into account general damages, attorney's fees and the potential exposure for punitive damages.
If State Farm wishes to resolve this matter immediately, I am authorized to accept the sum of $25,000 if received prior to the date when your client is due to answer Interrogatories.
Plattner also took Swiebel's deposition, and quotes part of it to support his version of the events:
Q: You offered it [the medical benefits payment] in full settlement of the entire amount claimed in the lawsuit; is that also correct?
....
A: Yes, sir, the answer to your question is yes.
Shortly before the deposition, an article appeared in the June 1985 edition of the Maricopa Lawyer announcing the formation of a committee of attorneys handling bad faith cases against State Farm. Richard Plattner was listed as one to contact for additional information. A copy of this article was found in the Malloques' file maintained by State Farm, although it is unclear who had placed it there and when.
On December 12, 1985, Plattner deposed Manuel Mendoza, claim consultant for State Farm. During the deposition, it became clear to State Farm that Plattner was taking the position, based on his earlier telephone conversation with Swiebel and on Swiebel's deposition testimony, that the $5,000 offer was conditioned on the Malloques agreeing to settle the medical and original bad faith claim.
The day after the Mendoza deposition, Hunsaker wrote Plattner, disputing Plattner's suggestion that the $5,000 offer was contingent on the Malloques' settlement of the bad faith claim. He also stated that "[i]f you intend to be a witness about that telephone conversation [with Swiebel], then you may need to consider whether you can continue to serve as plaintiffs' attorney in this case."
One month later, Hunsaker wrote to Plattner, stating that State Farm "did not intend nor did any correspondence sent to you or your clients make any demands of your client or attach any strings to the offer to pay the remaining portions or all portions of the medical payment coverage."
Because both Hunsaker and Plattner could be called as witnesses concerning the March 1985 conversation, they withdrew as counsel. New counsel for State Farm and the Malloques settled the case sometime later for $40,000, and Plattner received 50% of the fees from the settlement.
Plattner filed his own suit against State Farm on December 17, 1987, alleging intentional interference by State Farm with Plattner's contract with the Malloques. He claimed that State Farm, acting through Hunsaker and Swiebel, contrived in December 1985 to misrepresent State Farm's intent concerning the settlement, (the basis for the second bad faith claim), knowing that State Farm could dispute the substance of the conversation later, and thereby force Plattner to become a witness and withdraw from the case.
Plattner posited two theories why State Farm wanted him off the case. First, he contended that State Farm had not completed its discovery in the Malloque case, and consequently wanted to remove Plattner from the case to gain discovery time while the case was stalled for new counsel. Second, he presented evidence of the Maricopa Lawyer article.
Plattner sought compensatory and punitive damages, as well as attorneys' fees. State Farm responded that a cause of action arose only when the interference was with the client, and that Plattner was responsible for his own removal. The trial court granted State Farm's motion for summary judgment without elaboration. The court also granted $5,000 in attorneys' fees to State Farm under A.R.S. § 12-349. Plattner appeals from these rulings and from a discovery ruling which will be discussed in more detail below.
1. Does Arizona recognize a cause of action for intentional interference which prevents an attorney's performance of his contract with his client?
2. Does Plattner's evidence that State Farm intentionally and wrongfully forced him to withdraw as counsel in the Malloque case preclude summary judgment...
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