Vahila v. Hall

• Decision Date: 12 February 1997
• Docket Number: No. 95-2196,95-2196
• Citation: 674 N.E.2d 1164,77 Ohio St.3d 421
• Parties: VAHILA et al., Appellants, v. HALL et al., Appellees.
• Court: Ohio Supreme Court

Page 421

77 Ohio St.3d 421

674 N.E.2d 1164

VAHILA et al., Appellants, v. HALL et al., Appellees.

No. 95-2196.

Supreme Court of Ohio.

Submitted Nov. 12, 1996.

Decided Feb. 12, 1997.

SYLLABUS BY THE COURT

To establish a cause of action for legal malpractice based on negligent representation, a plaintiff must show (1) that the attorney owed a duty or obligation to the plaintiff, (2) that there was a breach of that duty or obligation and that the attorney failed to conform to the standard required by law, and (3) that there is a causal connection between the conduct complained of and the resulting damage or loss. ( Krahn v. Kinney [1989], 43 Ohio St.3d 103, 538 N.E.2d 1058, followed.)

On July 1, 1993, appellants, Terry R. Vahila, James G. Vahila, and Vahila Insurance Agency, filed a legal malpractice action against Charles D. Hall III, Ralph F. Dublikar, and the law firm of Baker, Meekison & Dublikar, appellees. Appellants' malpractice action arose in connection with appellees' representations of appellants in several civil matters, appellees' representations of Terry Vahila with respect to certain criminal charges that had been brought against her, and appellees' representation of Terry during an investigation of her by the Ohio Department of Insurance. In their complaint, appellants claimed that they had sustained damages as the direct and proximate result of appellees' negligent representations in the various civil, criminal, and administrative matters. Appellants further set forth claims against appellees for "extreme" emotional distress. Additionally, James Vahila sought recovery against appellees for loss of consortium.

Appellees answered appellants' complaint and denied any negligence in their prior representations of appellants. Appellees also filed a counterclaim to recover attorney fees allegedly owed by appellants. Thereafter, the matter proceeded to discovery.

On April 15, 1994, appellees filed a motion for summary judgment. In their motion, appellees asserted, among other things, that there was "[a] complete absence of any evidence of damages proximately caused by the alleged acts and/or omissions of the defendants[.]" With respect to this assertion, appellees claimed essentially that they were entitled to summary judgment because appellants were required to, but could not, prove that they would have been successful in the underlying civil, criminal, and administrative matters in which the alleged malpractice had occurred. To support this argument, appellees relied upon certain evidentiary materials of the type listed in Civ.R. 56(C).

Appellants responded to the motion for summary judgment. In support of their response, appellants submitted the affidavits of James and Terry Vahila and the affidavits of two expert witnesses, Bennett J. Wasserman and Eric A. Mertz. James and Terry Vahila indicated in their affidavits that they had sustained damages as the direct and proximate result of appellees' negligence. James stated that as a result of appellees' negligence they (appellants) had suffered damages of $100,000 and that they had lost profits "of at least" $200,000. Wasserman and Mertz indicated in their affidavits that they had reviewed the events surrounding the malpractice action, that appellees had breached various duties owed to appellants in connection with these matters, and that such negligent acts and/or omissions had been the direct and proximate cause of appellants' damages.

On May 26, 1994, the trial court granted appellees' motion for summary judgment. The trial court held that "there are no material issues of fact in controversy as to proximate cause and Plaintiffs have failed to establish the essential element of damages proximately caused by the Defendants' alleged negligence on all of their claims. Further, this Court finds that Plaintiffs have not demonstrated that, absent the alleged negligent conduct, Plaintiffs would have been successful at trial. As such, this case is not an appropriate one for a legal malpractice claim."

On June 23, 1994, appellants filed a motion with the trial court, requesting that the court reconsider its May 26, 1994 decision. In support of their motion, appellants attached supplemental affidavits of Wasserman and Mertz. Thereafter, on June 24, 1994, appellants filed a notice of appeal with the trial court regarding the court's May 26, 1994 decision.

On appeal, the Court of Appeals for Stark County affirmed the judgment of the trial court. The court of appeals, relying on Celotex Corp. v. Catrett (1986), 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265, held that appellees were entitled to summary judgment on appellants' claims because appellants, in response to appellees' motion for summary judgment, failed to prove that they sustained damages proximately caused by the alleged negligence of appellees. The court of appeals determined that "[t]o establish a genuine issue of material fact regarding proximate cause, the Vahilas were required to present evidence which, if believed, would have proved that the outcome of one or more of the matters in which defendants represented them would have been more favorable to them but for defendants' alleged breaches of duty." Specifically, the court of appeals concluded that "[i]n their response to defendants' motion for summary judgment, the Vahilas did not point to 'specific facts showing that there [was] a genuine issue for trial' regarding whether any of the matters in which defendants represented them would have resulted in a more favorable outcome to them but for defendants' alleged breaches of duty. They pointed to no evidence that any judgment entered against them in the civil matters would have been for a lesser amount, or that those civil matters would have been settled on a more favorable basis, but for defendants' mishandling of them; they pointed to no evidence that any cross-claim or counterclaim that defendants allegedly failed to assert would have been successful; they pointed to no evidence that the criminal prosecutions against Ms. Vahila would have been resolved more favorably to her but for defendants' alleged mishandling; and they pointed to no evidence that the investigation of Ms. Vahila by the Ohio Department of Insurance would have been resolved more favorably to her but for the alleged mishandling of that investigation by defendants."

The cause is now before this court pursuant to the allowance of a discretionary appeal.

McLaughlin, McNally & Carlin, Clair M. Carlin and Thomas M. Vasvari, Youngstown, for appellants.

Ulmer & Berne, P.L.L., Thomas R. Kelly and Jay W. Pearlman, Cleveland, for appellees.

Frank E. Todaro, Columbus, urging reversal for amicus curiae, Ohio Academy of Trial Lawyers.

DOUGLAS, Justice.

The primary issue in this case is whether the trial court and court of appeals properly concluded that appellees were entitled to summary judgment on the claims set forth in appellants' legal malpractice complaint. For the reasons that follow, we find that summary judgment should not have been granted in favor of appellees. Accordingly, we reverse the judgment of the court of appeals and remand this cause to the trial court for further proceedings.

Initially, we note that the trial court and court of appeals determined that appellees were entitled to summary judgment because appellants failed to establish that they sustained any damages proximately caused by the alleged negligent acts and/or omissions of appellees. The trial court's determination was based in part on the fact that appellants had failed to establish that, but for the negligence of their attorneys, appellants would have been successful in the underlying actions and proceedings in which the alleged malpractice had occurred. It appears that the court of appeals agreed with the findings of the trial court in this regard. However, we disagree with the conclusions reached by the trial court and court of appeals.

In Krahn v. Kinney (1989), 43 Ohio St.3d 103, 106, 538 N.E.2d 1058, 1061, we held that "a plaintiff need not allege a reversal of his or her conviction in order to state a cause of action for legal malpractice arising from representation in a criminal proceeding. To plead a cause of action for attorney malpractice arising from criminal representation, a plaintiff must allege (1) an attorney-client relationship giving rise to a duty, (2) a breach of that duty, and (3) damages proximately caused by the breach." ¹

In Krahn, Lynn B. Krahn managed a bar owned by High Spirits, Inc. ("High Spirits"). Krahn hired Winfield E. Kinney III to defend her with respect to three misdemeanor gambling charges that had been brought against her. High Spirits retained Kinney to represent it in connection with a citation issued by the Ohio Department of Liquor Control. However, following pretrial negotiations between Kinney and the prosecutor, Kinney failed to convey to Krahn that the prosecutor had offered to dismiss the charges in exchange for Krahn's testimony against her gambling-device supplier. On the day of trial, Krahn followed Kinney's recommendation to withdraw her plea of not guilty and enter a plea of guilty to one of the charges. Further, Kinney failed to appear at a hearing before the Ohio Liquor Control Commission to defend the citation that had been issued against High Spirits. As a result of Kinney's conduct, Krahn and High Spirits sued Kinney and the law firm for malpractice. The trial court granted summary judgment in favor of Kinney and the firm. The court of appeals reversed the judgment of the trial court.

Kinney and the law firm appealed to this court, arguing, among other things, that relief should not be granted in these types of cases unless the plaintiff first obtains a reversal of his or her underlying conviction on grounds of ineffective assistance of counsel. We rejected this argument and stated that:

"The inequity of requiring a plaintiff to obtain a reversal of his or her conviction...