Wood v. McGrath, North, Mullin & Kratz, P.C.

Decision Date30 June 1998
Docket NumberNo. A-96-1243,A-96-1243
Citation581 N.W.2d 107,7 Neb.App. 262
PartiesBeverly J. WOOD, Appellant, v. McGRATH, NORTH, MULLIN & KRATZ, P.C., Appellee.
CourtNebraska Court of Appeals

Syllabus by the Court

1. Directed Verdict. A trial court should direct a verdict as a matter of law only when the facts are conceded, undisputed, or such that reasonable minds can draw but one conclusion therefrom.

2. Directed Verdict. The party against whom the verdict is directed is entitled to have every controverted fact resolved in his or her favor and to have the benefit of every inference which can reasonably be drawn from the evidence.

3. Directed Verdict. If there is any evidence which will sustain a finding for the party against whom a motion for directed 4. Attorney and Client: Negligence: Proximate Cause: Proof. In legal malpractice cases, the plaintiff must prove the following: (1) the attorney's employment, (2) the attorney's neglect of a reasonable duty, and (3) that such negligence resulted in and was the proximate cause of loss to the client.

verdict is made, the case may not be decided as a matter of law.

5. Attorney and Client: Negligence: Proof. In a legal malpractice case, the negligence of counsel must affect the viability of the client's interest and be shown to do so.

6. Attorney and Client: Negligence: Expert Witnesses: Proof. In malpractice actions against attorneys, expert evidence is generally required to establish the attorney's breach of the standard of care. However, expert testimony regarding the status of the law is generally irrelevant and inadmissible.

7. Attorney and Client: Negligence: Expert Witnesses: Proof. Because an attorney performs professional services, it follows that expert testimony is generally required to prove a deviation from the standard of care and damages occasioned thereby in legal malpractice cases except in those cases where no expert is required due to common knowledge.

8. Trial: Evidence: Appeal and Error. Admission or exclusion of evidence is a matter for the discretion of the trial court, whose ruling on an evidential question will be upheld unless such ruling constitutes an abuse of discretion.

9. Evidence: Appeal and Error. An erroneous evidentiary ruling excluding evidence is not grounds for reversal where such ruling does not prejudice the party offering such evidence.

10. Trial: Expert Witnesses. An expert may testify about a reasonable and probable outcome at trial.

11. Modification of Decree: Alimony: Good Cause: Service of Process. Generally, an order for alimony may be revoked or modified for good cause shown, unless amounts have accrued prior to the date of service of process on a petition to modify.

12. Modification of Decree: Alimony: Good Cause. Good cause is demonstrated by a material change in circumstances which was not within the contemplation of the parties at the time of the decree or did not result from the mere passage of time.

13. Divorce: Property Division. Neb.Rev.Stat. § 42-366(8) (Reissue 1993) provides that the court shall include as part of the marital estate, for purposes of the division of property at the time of dissolution, any pension plans, retirement plans, annuities, and other deferred compensation benefits owned by either party, whether vested or not vested.

David Geier, of Healey & Wieland Law Firm, Lincoln, for appellant.

John R. Douglas and Terry J. Grennan, of Cassem, Tierney, Adams, Gotch & Douglas, Omaha, for appellee.



In this legal malpractice action, Beverly J. Wood (Beverly) appeals from an order of the district court dismissing her suit against McGrath, North, Mullin & Kratz, P.C. (McGrath). The legal malpractice action related to the professional advice of one of McGrath's attorneys, Timothy J. Pugh (Pugh). At the malpractice trial, Beverly attempted to prove that Pugh had negligently represented her in a dissolution action against her former husband, Jacob Wood (Jacob), which action was concluded by a settlement and decree. On appeal, Beverly argues that the district court erred in directing a verdict in McGrath's favor and that the trial court erred in failing to allow her to present certain evidence at the malpractice trial. For the reasons set forth below, we affirm.


Marriage and Dissolution Action.

Jacob and Beverly were married on August 25, 1973, and had two children, Joseph, born July 12, 1979, and David, born February 22, 1983. Jacob and Beverly were divorced In the Agreement, Beverly was awarded custody of the children with reasonable visitation rights for Jacob. Jacob agreed to pay $1,600 per month in child support. In addition to child support, Jacob agreed to provide "the cost of each child's college education, including tuition, room and board, books, and incidental fees in an amount at least equal to the charges then being assessed by the University of Nebraska-Lincoln for a Nebraska resident student." Regarding these payments, Jacob agreed to pay for two school semesters per year per child so long as each child maintained full-time status and a "C" average.

by decree of dissolution dated July 1, 1991. On that date, the trial court found that a "Property Settlement & Custody Agreement" (Agreement) entered into by the parties was not unconscionable and approved such Agreement. Both Jacob and Beverly were represented by counsel at the time they signed the Agreement. Jacob was represented by Irving Epstein, and Beverly was represented by Pugh.

Jacob also agreed to pay Beverly alimony in the amount of $3,300 per month for a period of 72 months. Both parties agreed that "neither of them will seek a modification of the alimony award during the 72 month period after entry of Decree." Of the $3,300 designated as alimony, a portion was attributable to a payout of the property settlement.

In the Agreement, Jacob and Beverly each received (1) all personal clothing, jewelry, rings, and other personal items in his or her possession; (2) all checking accounts, savings accounts, and credit cards in his or her name; and (3) all household goods, furnishings, and personalty in his or her possession.

Jacob also received (1) a 1984 Buick automobile; (2) all certificates of deposit with First National Bank of Omaha; (3) all accounts with Alex Brown & Company; (4) his 401(K) plan with Werner Enterprises, Inc. (Werner), Jacob's employer at the time of the Agreement; (5) his IRA; (6) 26,901 shares of Werner stock; and (6) all of his vested and unvested stock options in Werner.

Beverly received the following assets: (1) the family residence; (2) cash in the amount of $28,000, to be paid by Jacob at the time of the entry of the decree; and (3) a lump sum property distribution in the amount of $180,000, payable at the rate of $2,500 per month for a period of 72 months with no interest.

The Agreement provided that Jacob would pay Beverly's attorney fees in the amount of $9,976.90 and contained other provisions which are not relevant to this appeal.

Shortly after entry of the decree, in September 1991, Jacob was promoted to president of Werner, and his salary increased as a result. Pugh then filed an application to modify the decree, seeking an increase in child support and alimony, despite the clause in the Agreement prohibiting the modification of alimony within 6 years of the entry of the decree. The record shows that the parties tentatively entered into an agreement before a hearing was held on Beverly's application to modify and that in this agreement, Jacob agreed to pay Beverly an additional $500 a month, including $250 for education expenses of his sons and another $250 per month which Beverly could use for her own higher education goals. The record shows that while Beverly initially accepted this agreement, she subsequently declined to adhere to it because although Jacob had agreed to pay Beverly's attorney fees in connection with her application to modify, Jacob would not agree to pay other outstanding attorney fees Beverly had incurred. The record shows that Pugh withdrew as Beverly's counsel when Beverly decided that she would not accept the extra $500 per month. Beverly then obtained new counsel, Paul Galter, who assisted Beverly in releasing her from this agreement. The record shows that because of this release, Jacob continued to pay the same amount of alimony and child support set forth in the parties' July 1, 1991, Agreement.

Legal Malpractice Action.

On November 8, 1996, Beverly filed a third amended petition against McGrath, alleging, inter alia, that the Agreement, which Pugh advised her to accept, was unfair and disproportionate to her best interests; that Pugh allowed her to accept less than her share of Beverly alleged that Pugh failed to advise her that she should reject the settlement proposal as unreasonable and take her case to trial. Beverly alleged that as a result of Pugh's negligence, she suffered financial damage, and prayed for special and general damages and costs.

the marital estate; and that Pugh permitted and advised her to accept alimony conditions contrary to her best interests. Beverly alleged that Pugh had advised her that she was receiving 40 percent of the marital estate, when in fact she received less than 30 percent of the marital estate. Beverly alleged that Pugh had failed to correctly calculate the marital estate in the Agreement because he did not include Jacob's Werner stock options vesting after the dissolution and because he reduced the value of Jacob's common stock in Werner by its potential capital gains tax. Beverly also alleged that Pugh failed to adequately inform her concerning the provision in the Agreement precluding modification of alimony.

In its answer to Beverly's third amended petition, McGrath admitted that Pugh had represented Beverly in her divorce, but denied that McGrath had deviated from the standard of care for attorneys in Omaha, Nebraska.


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1 cases
  • Wood v. McGrath, North, Mullin & Kratz, P.C., S-96-1243
    • United States
    • Supreme Court of Nebraska
    • February 12, 1999
    ...on the issues raised in Wood's petition for further review. For a more detailed recitation of the facts, see Wood v. McGrath, North, 7 Neb.App. 262, 581 N.W.2d 107 (1998). Wood brought a legal malpractice action against McGrath, alleging that Pugh had negligently represented her in a dissol......
1 books & journal articles
  • "But for" and "case within the case" weakening.
    • United States
    • Defense Counsel Journal Vol. 68 No. 4, October 2001
    • October 1, 2001
    ...and there was thus no error in receiving their testimony in this regard. In addition, in Wood v. McGrath, North, Mullin & Kratz, 581 N.W.2d 107 (Neb. App. 1998), expert testimony was allowed as to the likely outcome of litigation. The Nebraska Court of Appeals The law states generally t......

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