Recently, the California Court of Appeal, Fourth Appellate District, Division Three (Santa Ana) partially published an opinion in an attorney malpractice case – Knutson v. Foster (Aug. 8, 2018, G054247) __Cal.App.5th ____. The court chose to partially publish the opinion for two reasons: (1) for its holding that claims of fraudulent concealment and intentional breach of fiduciary duty by a client against his or her attorney are subject to the substantial factor causation standard, not the "but for" or "trial within a trial" causation standard applied in legal malpractice claims for negligence, and (2) for its holding that plaintiff's testimony alone is sufficient to support emotional distress damages in cases where the emotional distress consisted of "anxiety, shame, a sense of betrayal, and a continuing impact on personal relationships." (Slip opn., p. 2.)
Plaintiff, a rising swimming star, sued her former attorney for professional negligence, fraudulent concealment and intentional breach of fiduciary duty. Plaintiff had given up a five-year scholarship package to swim for Auburn University when she was enticed by USA Swimming's head coach to swim professionally instead. He made various oral promises regarding financial support USA Swimming would provide without any performance markers. After the head coach was fired, USA Swimming refused to honor the oral agreement and plaintiff retained an attorney, Foster, to attempt to get them to honor the agreement. Foster did not disclose his close ties to USA Swimming or his previous representation of the head coach who had made the oral agreement. Foster negotiated a settlement without disclosing various communications and his close relationship with USA Swimming. He convinced plaintiff to agree to an almost impossible performance marker of top 25 in the world or top three in the U.S. for three years and to a release of claims against the former head coach. The pressure and stress of the deal she ultimately agreed to reactivated a prior eating disorder and eventually plaintiff retired from the sport.
The jury found in plaintiff's favor, but the trial court granted a new trial, concluding plaintiff had failed to meet the her burden of proving that if the misrepresentations had not been made and plaintiff had employed another attorney, she would have received a better result. (Slip opn., p. 16.) On appeal, the court concluded the trial court erred by applying an incorrect legal standard for causation in granting a new trial. As the court explained, because legal malpractice involves negligent conduct on the part of an attorney, causation for legal malpractice is analyzed differently than causation for intentional torts of fraudulent concealment and intentional breach of fiduciary duty, which are distinct intentional torts. (Slip opn., pp. 17-18.) For those claims, the substantial factor causation standard applies.
The trial court also granted a new trial on the jury's award of $400,000 for noneconomic damages on the grounds the damages were excessive. On appeal, the court held expert testimony to support the emotional distress damages award was not required; plaintiff's testimony alone was sufficient. The emotional distress plaintiff suffered did not involve a psychiatric or psychological disorder and was not beyond the common experience of the jurors. (Slip opn., p. 26.)
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