Stangland v. Brock
| Decision Date | 17 December 1987 |
| Docket Number | No. 53052-1,53052-1 |
| Citation | 747 P.2d 464,109 Wn.2d 675 |
| Court | Washington Supreme Court |
| Parties | , 56 USLW 2406 Alvin STANGLAND and Bruce Kintschi, Appellants, v. Norman D. BROCK, Kenneth D. Carpenter, and Underwood, Campbell, Brock & Cerutti, P.S., a professional business entity, Respondents. |
James J. Gillespie, Sheila M. Huber, Spokane, for appellants.
MacGillivray & Jones, Roger F. Chase, Spokane, for respondents.
The beneficiaries of a will brought this action for damages against two attorneys and their law firm, alleging that as a result of the attorneys' negligence they were unable to take assets originally devised to them. The trial court granted the defendants' CR 12(b)(6) motion to dismiss the action for failure to state a claim upon which relief could be granted. We affirm.
An action may be dismissed under CR 12(b)(6) only if " 'it appears beyond doubt that the plaintiff can prove no set of facts, consistent with the complaint, which would entitle the plaintiff to relief.' " Bowman v. John Doe, 104 Wash.2d 181, 183, 704 P.2d 140 (1985) (quoting Orwick v. Seattle, 103 Wash.2d 249, 254, 692 P.2d 793 (1984); Corrigal v. Ball & Dodd Funeral Home, Inc., 89 Wash.2d 959, 961, 577 P.2d 580 (1978)). For purposes of this motion, the plaintiffs' factual allegations are presumed to be true. Bowman, 104 Wash.2d at 183, 704 P.2d 140.
Respondents Norman Brock and Kenneth Carpenter are attorneys practicing in the Davenport office of the law firm of respondent Underwood, Campbell, Brock, & Cerutti, P.S. Appellants Alvin Stangland and Bruce Kintschi were designated as beneficiaries in the will of Ralph Schalock, now deceased.
Brock prepared the will and Schalock signed it in April 1979. Before the execution of the will, Brock had been the exclusive personal attorney for Schalock in all of his business and personal affairs. Schalock had been a client of the Underwood, Campbell, Brock & Cerutti firm and its predecessor for many years.
Schalock asked Brock to draft the will to leave all of his real property to appellants. At the time, Schalock's only real property of substantial value was a farm in Lincoln County. In their amended complaint, appellants alleged that Brock knew that Schalock's intent was "to pass the principal asset of his estate, his farm land," to them.
The will drafted by Brock provides as follows in paragraph IV:
I hereby give, devise and bequeath any and all real property owned by me at the time of my death unto ALVIN STANGLAND and BRUCE KINTSCHI equally, share and share alike, as their sole and separate property.
Paragraph V of the will left the residue of Schalock's property of every kind to Troy Rux and Joseph Kintschi, in equal shares.
On or about February 1, 1982, Carpenter prepared a real estate contract for the purpose of selling Schalock's farm to Frank and Janet Titchenal. Before the contract was executed, Carpenter did not discuss it with Brock and did not review Schalock's will or file. Appellants assert that although the firm circulated to its attorneys a memo reporting on new matters being handled in the firm, Brock did not notice that the real estate contract was being prepared and was not aware that the property was being sold. Appellants also assert that neither Brock nor Carpenter conferred with the other regarding Schalock's property or estate plan, and neither informed Schalock that the sale of the property on a real estate contract would affect the disposition of his estate.
On May 7, 1982, Schalock died. His will was admitted to probate. A dispute arose as to whether the vendor's interest in the real estate contract would pass to appellants, or to Troy Rux and Joseph Kintschi, the residuary beneficiaries. Litigation ensued between appellants and the residuary beneficiaries, ultimately resulting in a settlement by which appellants received 60 percent of the balance owing under the real estate contract.
Subsequently, appellants brought this action against respondents Brock, Carpenter and their law firm, seeking damages for professional negligence. Appellants alleged that in preparing Schalock's will, Brock neglected to provide for the effectuation of Schalock's intent to pass the principal asset of his estate, the farm, to them. They further alleged that by causing the farm to be conveyed by real estate contract to the Titchenals, respondents negligently disregarded the intent manifested by Schalock in his will. Appellants asserted that respondents did not advise Schalock that the effect of the sale on the real estate contract would be contrary to the intent expressed in his will. Appellants alleged that as a result of respondents' negligence and breach of duty to Schalock, appellants were unable to take the real estate originally devised to them.
Respondents brought a CR 12(b)(6) motion to dismiss the complaint for failure to state a claim upon which relief could be granted. The trial court entered an order granting the motion to dismiss. Appellants appealed to the Court of Appeals, which certified the case to this court.
This court has long held that for purposes of administration of an estate, a vendor's interest in an executory real estate contract should be treated as personal property rather than real property. In re Estate of Fields, 141 Wash. 526, 528, 252 P. 534 (1927). See also Freeborn v. Seattle Trust & Savings Bank, 94 Wash.2d 336, 340, 617 P.2d 424 (1980); Cascade Sec. Bank v. Butler, 88 Wash.2d 777, 782, 567 P.2d 631 (1977); In re Estate of Eilermann, 179 Wash. 15, 18, 35 P.2d 763 (1934). Under this rule, Schalock's interest in the real estate contract for the sale of his farm would be personal property for purposes of the administration of his estate. Schalock's will provided that only his real property would pass to appellants, and the remainder of his property would pass to the residuary beneficiaries. Hence, if Schalock's interest in the real estate contract was personal property for administration purposes, it would pass not to appellants, but to the residuary beneficiaries pursuant to the terms of the will. The question we must decide is if, under these circumstances, appellants have a cause of action against respondents for professional negligence with respect to their handling of Schalock's affairs.
In an action for legal malpractice sounding in negligence, the plaintiff must establish initially the existence of an attorney-client relationship. Bowman v. John Doe, 104 Wash.2d 181, 185, 704 P.2d 140 (1985). Once such a relationship is shown, the elements of such a legal malpractice action are the same as those of an action for negligence. These elements are: (1) the existence of a duty owed to the plaintiff; (2) a breach of that duty; (3) a resulting injury; and (4) a proximate cause between the breach of duty and the resulting injury. Bowman, at 185-86, 704 P.2d 140.
Traditionally, privity of contract between the parties has been required as a basis for establishing a duty in a legal malpractice action. Hence, attorneys' exposure to liability for malpractice has been confined to their clients. See R. Mallen & V. Levit, Legal Malpractice §§ 71, 72 (2d ed. 1981). However, as we recognized in Bowman, at 186-87, 704 P.2d 140, the modern trend is to relax the privity requirement, allowing legal malpractice actions to be brought by persons other than the clients of attorneys in some factual situations. In the absence of privity, there must be some other basis for a duty between the attorney and the plaintiff. Bowman, at 187, 704 P.2d 140; see also R. Mallen & V. Levit, at § 80.
In the present case, an attorney-client relationship existed between respondents and Schalock. However, there was no privity of contract between appellants and respondents. Therefore, in order for appellants to have a cause of action for legal malpractice, they must show that there is some other basis upon which respondents owed them a duty.
In Bowman, we observed that a duty between an attorney and a plaintiff who is not the client may be found under two theories. Bowman, at 187, 704 P.2d 140. Under one theory, first adopted in California, a multi-factor balancing test is applied to determine if an attorney owed a duty to a plaintiff. The factors in the test are: the extent to which the transaction was intended to affect the plaintiff; the foreseeability of harm to the plaintiff; the degree of certainty that the plaintiff suffered injury; the closeness of the connection between the defendant's conduct and the injury; the policy of preventing future harm; and the extent to which the profession would be unduly burdened by a finding of liability. See, e.g., Heyer v. Flaig, 70 Cal.2d 223, 227, 74 Cal.Rptr. 225, 449 P.2d 161 (1969); Lucas v. Hamm, 56 Cal.2d 583, 588, 15 Cal.Rptr. 821, 364 P.2d 685 (1961), cert. denied, 368 U.S. 987, 82 S.Ct. 603, 7 L.Ed.2d 525 (1962). See also R. Mallen & V. Levit, at § 80. The inquiry under this multi-factor test has generally focused on whether the attorney's services were intended to affect the plaintiff. See Bowman, 104 Wash.2d at 188, 704 P.2d 140; R. Mallen and V Levit, at § 81.
The second theory for finding a duty between the attorney and the plaintiff in the absence of privity is based on the concept of a third party beneficiary contract. The plaintiff must prove that he or she was intended to benefit from the established attorney-client relationship. See, e.g., Guy v. Liederbach, 501 Pa. 47, 459 A.2d 744 (1983); Pelham v. Griesheimer, 92 Ill.2d 13, 20, 64 Ill.Dec. 544, 440 N.E.2d 96 (1982); Stowe v. Smith, 184 Conn. 194, 441 A.2d 81 (1981). See also Bowman, 104 Wash.2d at 188, 704 P.2d 140; R. Mallen & V. Levit, at § 80 .
In most other jurisdictions where the issue has been considered, courts have held that an attorney who agrees to draft a will for his client owes some duty to the intended beneficiaries of the will, either under the multi-factor balancing test...
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