Storey v. Leonas
| Decision Date | 03 April 2009 |
| Docket Number | No. 46A03-0806-CV-300.,46A03-0806-CV-300. |
| Citation | 904 N.E.2d 229 |
| Court | Indiana Appellate Court |
| Parties | Jerry STOREY, Appellant-Plaintiff, v. Theodore S. LEONAS, Jr., and Leonas & Associates, Ltd., Appellees-Defendants. |
P.C., Valparaiso, IN, Attorneys for Appellant.
Edward R. Moor, Michael C. Bruck, Williams Montgomery & John Ltd., Chicago, IL, Attorneys for Appellees.
Appellant-plaintiff Jerry Storey appeals the trial court's orders dismissing his claims for malpractice and conversion against appellees-defendants Theodore S. Leonas, Jr., and Leonas & Associates, Ltd. (collectively, Leonas), and barring Storey's expert witnesses from testifying at trial. Storey argues that the trial court erroneously entered judgment in Leonas's favor on Storey's claims for legal malpractice and conversion.
We find that the trial court properly found that Indiana law applies to resolve Storey's claims but improperly barred evidence that the underlying lawsuit was filed and settled in Illinois court. Nonetheless, inasmuch as we find that the trial court properly barred Storey's expert witnesses, Storey's malpractice claim cannot survive because he cannot establish a breach of duty. Additionally, we find that the trial court properly entered judgment in Leonas's favor on the conversion claim because Leonas merely acted at the instruction of his client and, in any event, the action is based upon the failure to pay a debt, which does not constitute conversion. Thus, we affirm.
On December 23, 2000, Storey's adult daughter, Tara Storey, an Illinois resident, was a passenger in a car being driven by another individual in Michigan City. Another vehicle, owned by Chicago-based Heniff Transportation Systems, Inc. (Heniff), and being driven by a Heniff employee, allegedly ran a red light, entered an intersection, and struck the vehicle in which Tara was a passenger. Tara died as a result of the accident. She was not married and had no children.
Tara's mother and Storey's ex-wife, Delia Blair, hired Leonas to file a wrongful death action. At some point before the wrongful death action was filed on January 18, 2001, in Cook County, Illinois, Blair was named Special Administrator of Tara's Estate. Blair filed the wrongful death action as Special Administrator and as an individual. The wrongful death complaint stated that Tara's next of kin were Storey and Blair, both of whom sustained pecuniary damages. Appellant's App. p. 87.1
In May 2001, Heniff offered to settle the lawsuit for $650,000. Leonas relayed the offer to Blair, who accepted it the same day. On May 25, 2001, the wrongful death claim was officially settled, and the trial court found that it was a good faith settlement and dismissed the lawsuit with prejudice.2 Leonas did not request that the trial court determine proper expenses including attorney fees, and order distribution of the remaining proceeds to the next of kin pursuant to 740 ILCS 180/2, and the trial court made no such determination or order. Leonas testified that he took one-third of the $650,000 settlement as his fees.
On August 9, 2001, Leonas sent a letter to Storey's attorney, enclosing a check for $144,000 as Storey's share of the settlement. Leonas explained, "[t]his check represents that amount designated by Mrs. Blair for disbursement to Jerry Storey as the result of her decision to settle her legal cause of action in the above-captioned matter." Appellant's App. p. 110. Storey's attorney responded by letter on September 25, 2001, returning the $144,000 check and explaining that Storey
will conditionally accept this payment but only on the following terms: (1) written assurance is given by you or your client that Tara's siblings are also receiving the same amount, so that the allocation will be one-third to the siblings, one-third to mom and one-third to dad; (2) acceptance of this sum does not constitute nor will it be construed as a settlement or waiver of any other claims brought by Mr. Storey, individually or in his capacity as personal representative of Tara's estate, against any party, nor shall it constitute acceptance, endorsement or acquiescence in the terms of any settlement already reached between your client and any other party.
If these terms are agreeable, please reissue your check made payable to the Trust Account of [Storey's attorney] and forward it to my Valparaiso office. If these terms are not agreeable, please place this $144,000 in an interest bearing account or money market fund for the benefit of Jerry Storey and forward proof of such an account to me at your soonest convenience....
On November 16, 2001, Leonas responded and set forth a "short historical review" of the events that had occurred up to that point. Among other things, Leonas explained that he and Blair had decided to file the wrongful death claim in Illinois because Id. at 113.1. Later, having received the settlement offer, Leonas explained that, "[a]fter careful consideration of all of the issues involved, including the possibility that the Illinois Court could find that jurisdiction was not proper, [ ] Blair advised me, on her behalf, to accept the" settlement offer. Id. at 113.2. Blair directed Leonas to disburse $144,000 to Storey, which Storey "has elected to refuse." Id. at 113.3. Inasmuch as Storey continued to pursue his own lawsuit and "obviously does not consider himself to have been a benefactor in any legal action taken by [ ] Blair," she "has directed me to deny any further disbursement of funds for benefit of [ ] Storey in this matter." Id.
On August 14, 2002, Storey filed the complaint at issue herein in LaPorte County, bringing claims of legal malpractice and conversion against Leonas. The complaint alleges that Leonas had breached his fiduciary duty to Storey in one or more of the following ways:
(A) Leonas failed to pursue all available avenues of legal recovery or causes of action on behalf of Tara's Estate (B) Leonas failed to conduct an adequate and proper investigation into the facts of Tara's death, and/or the identity of those who were liable for the damages resulting from her death;
(C) Leonas failed to properly communicate with the beneficiaries of Tara's Estate regarding his representation of the Estate and failed to inquire of Tara's family regarding the circumstances of Tara's death and the identity of persons or entities potentially liable for it;
(D) Leonas failed to secure court approval of proposed distribution of settlement proceeds of the wrongful death action he filed on behalf of Tara's Estate;
(E) Leonas extracted an excessive and improper fee from settlement proceeds, which rightly belong to Tara's Estate; and/or
(F) Leonas otherwise failed to use the same care and caution that a reasonably prudent attorney would have used under the same or substantially similar circumstances.
The case was set for trial on June 7, 2005. On April 29, 2005, Storey filed a motion for partial summary judgment, raising choice of law and attempting to apply Illinois substantive law for the first time in a pleading, and on May 16, 2005, Storey filed a motion to determine the applicable state law. Following a hearing, the trial court denied the motion on June 10, 2005, finding that Storey had waived any right to present evidence of Illinois law by failing to give prior reasonable notice of his intent to do so. In relevant part, the trial court ruled as follows:
9. This cause of action was filed August 14, 2002, well over two and one-half years prior to plaintiff's filing of the motion to determine applicable state law on May 16, 2005. Nothing in the Complaint ... establishes that plaintiff intended or contemplated that Illinois law should govern the resolution of the claims ... the mere fact that plaintiff alleged that [Leonas] had filed proceedings in [Illinois] was insufficient to constitute the "reasonable notice" contemplated in the Act. Sword v. State [NKC Hosps. Inc.], 714 N.E.2d 142, 146-47 (Ind.1999).
10. No other pleadings prior to the motion at issue indicate that plaintiff intended to ask this court to apply Illinois law to the case at hand. As late as March 16, 2005, plaintiff filed his list of contentions, witnesses and exhibits which, once again, failed to apprise defendants of any intention to assert that Illinois law should govern the disposition of his claims against defendants....
11. .... The motion was filed a mere twenty-one ... days prior to trial and, of significance, a mere four ... days prior to the date—May 20, 2005—by which discovery was required to be completed. The opportunity to study the law which will apply to the cause at hand has a direct and consequential effect on the manner in which discovery is conducted, the questions that may be asked, the persons who may be deposed, the documents that may be sought, as well as a host of decisions that may be made as matters of pretrial strategy and preparation. The timing of plaintiff's motion requesting that Illinois law be applied in the trial of this cause effectively foreclosed defendants from conducting a fully-informed approach to discovery in this cause.
... The "playing field" was, simply stated, not level; a distinct advantage in time and ability to prepare motions in limine and proposed final instructions inured to plaintiff's counsel....
12. When asked at the hearing held on May 31, 2005, as to the reasons why his motion to determine the applicable state law had not been filed at an...
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