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11th Districts reverses Trumbull County legal malpractice case

TRACEY BLAIR
Legal News Reporter

Published: June 17, 2019

A Trumbull County trial court erred in granting an attorney’s motion for summary judgment dismissing claims of legal malpractice and breach of fiduciary duty, the 11th District Court of Appeals ruled recently.

Appellant Lori Schmitt appealed an Aug. 17, 2018, entry in favor of attorney Deborah Witten. At issue was whether Schmitt’s claims are barred by the doctrine of collateral estoppel.

The appellate court reversed and remanded the judgment.

Schmitt hired Witten to represent her in the dissolution of her 23-year marriage to Fred Schmitt. Although Witten recommended the appellant seek a divorce, Schmitt proceeded with the dissolution. Her husband was unrepresented.

Witten drafted a separation agreement that included a provision that the husband shall pay $71,000 to his wife from his pension. Witten then referred the former couple to another attorney to draft a Qualified Domestic Relations Order (QDRO).

It is undisputed that after the decree was issued, Schmitt contacted Witten complaining the terms of the separation agreement did not reflect what she and her former spouse agreed to regarding his pension. Witten then sent Fred Schmitt a letter asking him to sign an amended separation agreement stating he will rollover $71,000 by a QDRO to equalize the parties’ 401k, or she would have to file a 60(B) motion to vacate the dissolution.

Fred Schmitt refused to sign the amended agreement, claiming he and his former wife had not agreed to include a division of his pension.

Lori Schmitt retained new counsel to file a Civ.R 60(B) motion for relief from judgment. A domestic relations court denied the motion, concluding there was “no excusable neglect, inadvertence, mistake or surprise” justifying relief.

Lori Schmitt did not appeal that decision, but filed a legal malpractice suit against Witten on the grounds her attorney failed to protect her rights to her ex-husband’s pension funds during the dissolution, causing her to suffer more than $25,000 in damages, plus legal expenses.

Witten countered that her former client’s claims were barred by res judicata and collateral estoppel due to the trial court denying the Civ.R. 60(B) motion. She also argued the statute of limitations had expired.

The trial court held the appellant is collaterally estopped from filing the claims. The Trumbull County judge ruled the issue on who was responsible for the Dominion East Ohio Gas pension plan being left out of the dissolution decree was actually tried and determined at the 60(B) hearing, and that the issue is identical to the issue in the malpractice action.

On appeal, Lori Schmitt alleged the issue of a “mistake” in a Civ.R. 60(B) proceeding is not sufficiently identical to the issue of “breach of duty” in a legal malpractice action, therefore a breach of duty claim is not barred by collateral estoppel.

Witten cited two cases she claimed supported the trial court’s decision to grant summary judgment on the doctrine of collateral estoppel. The first, Woodrow v. Heintschel, was a 2011 6th District case granting a 60(B) motion because it failed to properly notify the defendants of court hearings after the attorney withdrew from representation.

In the second case, Fallang v. Becker, the 12th District upheld a Butler County judge’s decision denying the 60(B) motion because the wife knew or should have known of her husband’s alleged fraudulent non-disclosure within the applicable statute of limitations.

However, the panel found neither case applied to the facts in Schmitt’s lawsuit.

“The general requisite of mutuality is not met here,” 11th District Judge Timothy P. Cannon wrote in his majority opinion. “Appellee was not a party to the underlying dissolution between Lori and Fred nor was appellee bound in any way by the denial of Lori’s 60(B) motion in the domestic relations court. Although appellee was a witness at the 60(B) hearing, she was not a party to it. The exception to mutuality also cannot apply here, as Lori clearly has not had her day in court on the specific issues she alleges in her legal malpractice complaint. We conclude appellee has failed to demonstrate that she is entitled to judgment as a matter of law on the basis of collateral estoppel. Accordingly, the trial court erred in granting appellee’s motion for summary judgment on that theory.”

Appellate judges Thomas R. Wright and Mary Jane Trapp concurred.

The case is cited Schmitt v. Witten, 2019-Ohio-1953.


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