Springville Corp. v. Stoel Rives LLP

• Decision Date: 09 March 2016
• Docket Number: A151806.,110201670
• Court: Oregon Court of Appeals
• Parties: SPRINGVILLE CORPORATION, an Oregon corporation, Plaintiff–Appellant, v. STOEL RIVES LLP, an Oregon limited liability partnership; and James N. Westwood, an individual, Defendants–Respondents, and Tarlow Naito & Summers LLP, an Oregon limited liability partnership, Defendant.

276 Or.App. 725

372 P.3d 14

SPRINGVILLE CORPORATION, an Oregon corporation, Plaintiff–Appellant,

v. STOEL RIVES LLP, an Oregon limited liability partnership; and James N. Westwood, an individual, Defendants–Respondents,andTarlow Naito & Summers LLP, an Oregon limited liability partnership, Defendant.

110201670

A151806.

Court of Appeals of Oregon.

Argued and Submitted June 10, 2014.

Decided March 9, 2016.

Bonnie Richardson, Portland, argued the cause for appellant. With her on the briefs were Shannon Flowers and Folawn Alterman & Richardson LLP.

Brian R. Talcott, Portland, argued the cause for respondents. With him on the brief were Thomas H. Tongue, Randy L. Arthur and Dunn Carney Allen Higgins & Tongue LLP.

Before ARMSTRONG, Presiding Judge, and HADLOCK, Chief Judge, and EGAN, Judge.^*

ARMSTRONG

, P.J.

Plaintiff Springville Corporation brought an action for legal malpractice against defendants Stoel Rives LLP and attorney James N. Westwood,¹ alleging, among other things, that Stoel Rives had given it erroneous legal advice about the need to appeal a limited judgment in a construction case in which Springville was the defendant.² See Interstate Roofing, Inc. v. Springville Corp., 347 Or. 144, 218 P.3d 113 (2009)

(describing the underlying case). The trial court granted Stoel Rives's motion for summary judgment on the ground that Springville had failed to establish that there was a genuine issue of material fact on the causation element of Springville's malpractice claim and, accordingly, Stoel Rives was entitled to judgment as a matter of law. Springville appeals the resulting general judgment of dismissal, challenging the trial court's ruling on summary judgment. Because Springville did not establish that a timely appeal would have resulted in a reversal of the limited judgment in the underlying case, we agree with the trial court that Stoel Rives was entitled to summary judgment. Accordingly, we affirm.

I. BACKGROUND A. The Underlying Case

Springville contracted with Interstate Roofing, Inc., to remove and replace siding, exterior decks, stairs, and stair landings and repair dry rot on five of eight separate buildings in a 128–unit condominium complex owned by Springville, specifically buildings A, B, C, D, and F. At some point, Springville stopped making payments under the contract due to alleged defects in the work.

Interstate then brought an action in Washington County Circuit Court, alleging three claims for relief against Springville: (1) foreclosure of a construction lien for unpaid work by Interstate on Building F; (2) breach of contract; and (3) quantum meruit.³ Springville, through its trial counsel, Tarlow Naito & Summers, LLP, denied liability and brought counterclaims against Interstate for breach of contract and negligence.

Springville submitted a written demand for a jury trial. In pretrial proceedings, the court acknowledged that Interstate's lien-foreclosure claim on Building F was a matter for the court, but that all of the other claims—namely, Interstate's breach-of-contract and quantum meruit claims, as well as Springville's counterclaims for breach of contract and negligence—were jury-trial claims, and the parties and the court discussed at length how best to try the case given those circumstances.

At a pretrial hearing on July 18, 2006, the court suggested that the best course of action would be to try all of the claims at the same time, and counsel for Interstate agreed:

“[THE COURT]: The foreclosure matter then, in terms of finding whether the lien itself would be allowed or not is to the Court. And the remaining matters are to the jury. * * *

“ * * * * *

“Maybe we should just wait until we get to this point, but it seemed to me that would it not be better to just try the whole thing to the jury with me, doing it to the Court at the same time. * * *

“MR. WELBORN: All right. Your Honor, on behalf of Interstate Roofing, I believe that it would be a cleaner, easier approach if we did take that approach, and we tried the whole cases as one. And the foreclosure action, reserving for yourself that decision on that lien, but trying the whole cases as one there. So we'd start out the case, prove our lien case. Then it would turn over to Springville. They'd put on their defense and counterclaim, and we'd defend that case.”

Springville's counsel, however, argued for bifurcation:

“MR. TARLOW: The option that allow—that is first to be made is whether or not you bifurcate the case and try the lien case yourself and put the jury trial on all other issues off, so that we would be trying the lien case only. We would not be trying the indemnity case.^[4] We'd be trying the counterclaim case, but we would not be trying the indemnity, and we would have—the jury trial issues all would be put off.

“That case is a shorter case. It creates judicial efficiency because of the time that is involved. It avoids any of the problems that took these three cases to the appellate courts in the first instance [referring to Safeport, Inc. v. Equipment Roundup & Mfg., 184 Or.App. 690, 60 P.3d 1076 (2002)

, rev. den., 335 Or. 255 (2003) ; Westwood Corp. v. Bowen, 108 Or.App. 310, 815 P.2d 1282 (1991), rev. dismissed, 312 Or. 589 (1992) ; DeWitt–Erickson Const., Inc. v. Moran Const. Co., 86 Or.App. 474, 739 P.2d 1071, rev. den., 304 Or. 280 (1987) ]. And what would then be the options of the trial lawyers is whether or not, given whatever your decision is, either of—either side would be interested in spending the time and the money and the effort to do it all over again because if it's done either together or separate, we, assuming we're going to prevail, get two bites at the apple.

“So that the way this works is, whether we try it in front of the jury and the Court at the same time or later, if we prevail, we get the best of the two results. We get the best of the two results. And that's what happened in the Westwood case.

“Now, so I get two bites at the apple. So there's some advantages to me, or to my client, to having this tried twice; whether the twice is simultaneously or the twice is sequential.

“In addition, there are some tactical reasons for—which will not become apparent until later in the case, for us to be trying

this case in front of a jury, as opposed to the Court. However, having said that, it is cheaper for the parties, it's more efficient for the Court and the system, and there is much less chance of an appeal if this case is tried to the—to the Court. That is, it's bifurcated and the rest of the case and cases are put off till later.”

The court and trial counsel for Springville then discussed what would happen if—whether tried together or separately—the process yielded inconsistent results:

“MR. TARLOW: Well, you can't control that. I mean, you can't control that because presumably you're going to call them the way you see them, the jury's going to call it the way they see it, and we have the potential for inconsistent results, which for sure takes everybody in this courtroom, all the litigants and whoever's writing the checks, all the way up probably to the Supreme Court. Not a good result for everybody—anybody.

“So if we talk about, well, what's the most efficient, least cost way to do this, with the best opportunity to do it once and only once, it is to bifurcate as the—as the other case—

“ * * * * *

“ * * *—the Safeport case, what that judge did, bifurcate it, try the lien case now, and then the parties and I presumably aren't going to come back a second time because at that point, everybody knows what everybody's going to do, there aren't any more surprises, there aren't any more secrets, everybody's seen the witnesses. They know the experts are going to perform. They're not going to be able to get the experts to change their opinions because, you know, everybody's tied down with all the examination. And it's likely it happens once.”

The discussion continued the next day. Springville's counsel continued to argue for bifurcation, while counsel for Interstate was in favor of trying the whole case simultaneously, with the court deciding the lien claim and the jury deciding the other claims. The court ultimately decided that the trial would proceed initially only to the court, with any remaining jury questions to be litigated in the future. Because Interstate's lien claim concerned only one of the buildings—Building F—and it had made its own request for a jury trial on Springville's counterclaims with regard to Buildings A, B, C, and D as well, Interstate's counsel sought to clarify the scope of the proposed court trial:

“MR. WELBORN: * * * And just so I'm clear about what is going to happen in the next couple of weeks here, we are trying the lien case to you. They're [i.e., Springville] bringing on their defenses and counterclaim only with regard to [Building] F?”

Springville's counsel disagreed with that proposition, and indicated his understanding that the court was also going to rule on Springville's counterclaims as to Buildings A, B, C, and D, stating, “That's the way it works, Your Honor. The entire case gets tried.” However, counsel also indicated that he understood that there would also be a jury trial on the counterclaims, that it was just a matter of the “timing” of that jury trial. Counsel reiterated that his understanding of ORS 87.060⁵

and the relevant caselaw was that he “get[s] two bites at the apple,” and “if, in fact, both the judge and the jury come in in our favor, but in different amounts, I get the biggest. I get the biggest one.” He also explained that he understood Westwood to stand for the proposition that,

“because there's a constitutional right to a jury trial, there's no preclusion because the statutory case can't preclude the constitutional right to a jury trial. And there's no issue preclusion and there's no law of the case and there's none of that stuff because you have an absolute right to a jury trial.”

The trial court ultimately accepted Springville's proposed method of proceeding,...