Wallace v. Law Offices of Bruce M. Spencer, PLLC

• Decision Date: 28 September 2021
• Docket Number: DA 20-0611
• Citation: 496 P.3d 545 (Table)
• Parties: Terry WALLACE, Plaintiff and Appellant, v. LAW OFFICES OF BRUCE M. SPENCER, PLLC, LPH, Inc., a Montana Corporation, Geiszler Steele, PC, and John Does 1-5, Defendants and Appellees.
• Court: Montana Supreme Court

496 P.3d 545 (Table)

Terry WALLACE, Plaintiff and Appellant,

v.LAW OFFICES OF BRUCE M. SPENCER, PLLC, LPH, Inc., a Montana Corporation, Geiszler Steele, PC, and John Does 1-5, Defendants and Appellees.

DA 20-0611

Supreme Court of Montana.

Submitted on Briefs: August 11, 2021

Decided: September 28, 2021

For Appellant: Terry A. Wallace, Self-represented, Missoula, Montana

For Appellees: Mikel L. Moore, Moore, Cockrell, Goicoechea & Johnson, P.C., Kalispell, Montana (for Law Office of Bruce M. Spencer, PLLC), Jon A. Wilson, Brown Law Firm, P.C., Billings, Montana (for LPH, Inc.), David J. Steele, II, Timothy D. Geiszler, Geiszler Steele, PC, Missoula, Montana (for Geiszler Steele, PC)

Justice Jim Rice delivered the Opinion of the Court.

¶1 Pursuant to Section I, Paragraph 3(c), Montana Supreme Court Internal Operating Rules, this case is decided by memorandum opinion and shall not be cited and does not serve as precedent. Its case title, cause number, and disposition shall be included in this Court's quarterly list of non-citable cases published in the Pacific Reporter and Montana Reports.

¶2 Terry Wallace (Wallace) appeals the order entered by the First Judicial District Court, granting summary judgment on Wallace's claims in favor of Law Offices of Bruce M. Spencer, PLLC, LPH, Inc., and Geiszler Steele, PC (Appellees), and granting Appellees’ joint motion to declare Wallace a vexatious litigant. We affirm.

¶3 Discovery Dental Group (DDG) contracted with LPH, Inc., a debt collection agency, to collect an unpaid $1,112.13 bill from Karrie Serrania, who had signed a contract as responsible party for dental services rendered by DDG to Serrania, her then-husband, and her son. Serrania did not pay the debt, and LPH brought action in Justice Court. But after Wallace became Serrania's counsel and filed counterclaims that exceeded the Justice Court's jurisdiction, Serrania initiated suit against DDG and LPH in the District Court. Serrania asserted violations of the Fair Debt Collection Practices Act (FDCPA) and the Montana Consumer Protection Act and sought damages of approximately $650,000. The District Court granted summary judgment to DDG and LPH; and in January 2014, after concluding Serrania and Wallace had violated M. R. Civ. P. 11 by their vexatious actions, ultimately imposed sanctions in the amount of $42,113.32 to be paid to LPH and $32,647.94 to be paid to DDG. The court also sanctioned Wallace an additional $1,000 each to counsel for LPH and DDG for failing to appear at a scheduled hearing and $10,000 for "his blatant lack of candor and his disrespectful conduct toward the Court and the legal process and his egregious abuses of the legal rights of the Defendants." Serrania v. LPH, Inc. , 2015 MT 113, ¶ 10, 379 Mont. 17, 347 P.3d 1237 (Serrania I ). Serrania filed for bankruptcy and discharged her debts. Serrania I , ¶ 11. On appeal, we affirmed the summary judgment and determined that the District Court did not abuse its discretion by imposing the $1,000 and $10,000 sanctions. Serrania I , ¶¶ 32, 36. After determining Serrania's FDCPA claim "had some grounding in the law—albeit not enough to withstand summary judgment"—i.e., it was not entirely frivolous, Serrania I , ¶ 37, we remanded the other sanctions to be recalculated without regard to the filing of the FDCPA claim. Serrania I , ¶ 38. On remand, the District Court withdrew the $10,000 sanction against Wallace and ordered him to pay LPH $30,847.68 for fees unrelated to the FDCPA claim, a decision which we affirmed on appeal. Serrania v. LPH, Inc. , No. DA 17-0221, 2018 MT 3N, ¶¶ 4, 6, 2018 Mont. LEXIS 2. (Serrania II ).

¶4 On October 30, 2018, following a complaint filed by the Office of Disciplinary Counsel and a hearing before the Commission on Practice (COP), this Court issued an Order of Discipline, affirming the COP's Findings of Fact and Conclusions of Law, and adopting its Recommendation to suspend Wallace from the practice of law for seven months, with readmittance subject to reapplication. See In the Matter of Terry A. Wallace , PR 17-0245, Order of Discipline (Mont. Oct. 30, 2018). We noted therein that "[t]he records related to this proceeding are replete with incidents of professional misconduct" by Wallace.

¶5 In November 2018, Wallace filed a complaint in the United States District Court for the District of Montana, naming as defendants the State of Montana, District Judges Ed McLean and Leslie Halligan, who presided over the respective Serrania I and II trial proceedings, and the Justices of this Court. See Wallace v. Montana , No. CV-18-103 RJB, 2019 LEXIS 60606 (D. Mont. Apr. 8, 2019). In April 2019, Wallace's case was dismissed for failure to state a claim for which relief can be granted, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Wallace , 2019 LEXIS 60606, at *15.¹

¶6 Following the entry of judgment against Wallace for the sanctions we affirmed in Serrania II , LPH retained attorney Bruce Spencer to collect it. Spencer obtained issuance of a writ of execution, but was unable to locate Wallace or his assets, despite searching credit records, postal records, and Motor Vehicle Division records. The address given by Wallace to the U.S. Post Office belonged to the First Presbyterian Church of Missoula. Spencer had a subpoena issued for Wallace, which was returned after the process server was unable to locate him. Ultimately, Spencer served two subpoena duces tecum upon Dr. Sam Wallace, son of Wallace, seeking to depose Dr. Wallace regarding the location of his father and his father's assets. The first deposition was cancelled after Wallace communicated to Spencer that the subpoena lacked language required under M. R. Civ. P. 45. Spencer corrected the language and served a second subpoena for a deposition, which had to be cancelled by Spencer because of an unrelated emergency. The first deposition had been designated to occur at a hotel in Missoula, while the second was scheduled for a conference room at the Missoula office of Geiszler Steele, PC.² At this time, Spencer advised Wallace and his son that if Wallace would accept service of the writ, the need to subpoena Dr. Wallace could be avoided. Wallace declined and, after the deposition subpoenas were again served on his son, Wallace filed this lawsuit, alleging claims against LPH, Spencer, and Geiszler Steele, PC for abuse of process, intentional infliction of emotional distress (IIED), and civil conspiracy.

¶7 Appellees filed motions for summary judgment and also filed a joint motion requesting an order declaring Wallace to be a vexatious litigant, requiring anything he sought to file be pre-approved by the District Court. In an October 20, 2020 Order, discussed further below, the District Court granted Appellees’ motions for summary judgment and their joint motion declaring Wallace to be a vexatious litigant. Wallace appeals, challenging the entry of summary judgment on his claims and the entry of the Order declaring him to be a vexatious litigant.

¶8 We review a district court's grant of summary judgment de novo, applying the same M. R. Civ. P. 56 criteria as applied by the lower court. Serrania I , ¶ 12. Summary judgment is appropriate if the movant successfully carries the burden to establish that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law as confirmed by a review of "the pleadings, the discovery and disclosure materials on file, and any affidavits[.]" M. R. Civ. P. 56(c)(3). If the movant satisfies the burden, the burden shifts to the nonmovant, who is tasked with setting forth particularized facts—not merely "rely[ing] upon their pleadings, nor upon speculative, fanciful, or conclusory statements"—in opposition of summary judgment. Thomas v. Hale , 246 Mont. 64, 67, 802 P.2d 1255, 1257 (1990) (citation omitted).

¶9 "Essential to proof of [the claim of] abuse of process is (1) an ulterior purpose and (2) a willful act in the use of the process not proper in the regular conduct of the proceeding." Hughes v. Lynch , 2007 MT 177, ¶ 21, 338 Mont. 214, 164 P.3d 913 (quoting Brault v. Smith , 209 Mont. 21, 28, 679 P.2d 236, 240 (1984) ) (internal quotation omitted). " ‘Some definite act or threat not authorized by the process, or aimed at an object not legitimate in the use of the process, is required; and there is no liability where the defendant has done nothing more than carry out the process to its authorized conclusion, even though with bad intentions.’ " Hughes , ¶ 21 (quoting Prosser, The Law of Torts § 121, at 857 (4th ed., West 1971)). Wallace contends that summary judgment is improper because there exist genuine issues of material fact regarding whether Spencer's efforts to collect the judgment were undertaken with an "ulterior motive" and "not in the regular conduct of" proceedings in aid of execution of the judgment, arguing "[w]hat we have here is Spencer and Steele, who, because of their over the top animosity towards Wallace, are doing everything they can to get their ad hominem claims about Wallace before the court, and who, without a writ of execution, tried to illegally subpoena Wallace's son in direct violations of the law."

¶10 From the undisputed facts, the District Court determined that the Appellees "did not abuse process" when they "lawfully sought to depose [Wallace's son] regarding his father's whereabouts and assets," noting this procedure was authorized under a plain reading of M. R. Civ. P. 69. The court noted that none of Wallace's accusations rose "to a level beyond mere speculation that Spencer or LPH has done anything beyond carrying out the process of collecting a judgment to its authorized conclusion," or that Appellees "sought a ‘collateral advantage’ by filing the subpoenas," or "sought to threaten or coerce Wallace into any act by filing the subpoenas." The District Court reasoned that Spencer's "simple (and accurate) statement that Wallace's consenting to service would...