Summary
holding that an attorney could not be held liable for failing to bring a certain cause of action "where he ceased to represent plaintiff and was replaced by other counsel before the statutory period ran on [the plaintiff's] underlying action"
Summary of this case from Estate of Knudsen v. FiegerOpinion
Docket No. 97256.
Decided March 30, 1988.
Thurswell, Chayet Weiner (by Milton H. Greenman), for plaintiff.
Robert P. Keil, for defendant.
Plaintiff appeals as of right from the trial court's order granting defendant Odette's motion for summary disposition in this legal malpractice case, as well as from the trial court's order denying plaintiff's motion for rehearing. In particular, plaintiff claims that she should have been allowed to amend her complaint to allege that defendant Odette committed legal malpractice when he failed to timely file a suit on plaintiff's behalf against James W. McKay, on the basis that McKay knowingly furnished alcoholic beverages to then nineteen-year-old Kirk Gildner, who subsequent to the consumption of the intoxicants was involved in a traffic accident in which plaintiff was injured. The trial court held that plaintiff's legal malpractice claim based upon defendant Odette's failure to timely pursue a social-host claim against McKay was barred by the statute of limitations, that any damages plaintiff suffered were attributable to her present counsel's failure to file suit before the statutory period of limitation had expired and that, in any event, the amendment was futile because there was no viable social-host claim against McKay. We affirm.
On November 5, 1982, McKay hosted a wedding reception for his son at the Flint Association of the Deaf, Incorporated (FAD). McKay rented the hall from FAD and provided his own alcoholic beverages. FAD did not supervise the distribution of the alcoholic beverages, but there was a bar at the reception. Gildner was informally invited to the reception by one of his friends, who was apparently related to McKay's son. There were approximately 150 to 200 guests at the reception.
Gildner arrived at the reception at approximately 10:00 P.M. Gildner ate and talked with some of his friends, including twenty-year-old Donald Hippinsteel. Gildner did not attempt to obtain alcohol from the bar because he assumed that the bartenders were checking identification. The others sitting at the table were also apparently minors and did not have alcohol. Gildner claims that sometime thereafter a group of people sitting at a nearby table left the reception. These people left behind a partially full pitcher of beer. Gildner is "pretty sure" that Hippinsteel grabbed the pitcher from the other table after it had been sitting there for a couple of minutes. Hippinsteel poured himself a glass of beer and set the pitcher down on the table. Gildner then reached over and poured some beer into a cup from which he had previously been drinking nonalcoholic punch. Gildner drank two or three glasses of beer. Gildner could not recall any one else at his table drinking.
Hippinsteel recalled drinking one or two glasses of beer. He denied providing beer to Gildner. Hippinsteel could not recall how he obtained the beer or if anyone else was drinking; however, he thought that it was likely that he had obtained the beer from a pitcher on a table because it was not given to him by an adult.
At 11:30 or 11:45 P.M., Gildner left the reception. He admitted that he felt the effects of the alcohol, but stated that he was just happy and not drunk. As Gildner was driving home, he was attempting to repair the wires on his new car stereo when he crossed the center line and struck head-on the vehicle in which plaintiff was riding as a passenger. The accident occurred at 12:04 A.M., four miles from the FAD hall. Plaintiff was injured. Gildner did not recall crossing the center line and was not ticketed.
Plaintiff hired Odette to represent her. Odette obtained a settlement with Gildner and his nofault insurer on February 11, 1984. Odette claims that, at the time the settlement was signed, he discussed its effect on plaintiff's further actions under the dramshop act, given the name-and-retain provision. Plaintiff denies that such a discussion took place.
On July 8, 1985, plaintiff hired her present counsel to pursue claims on her behalf arising out of the accident. Plaintiff then filed suit against FAD on July 11, 1985. Plaintiff claims that the suit was dismissed on October 21, 1985, because the statutory period of limitation had expired; however, the order dismissing plaintiff's suit against FAD provides that plaintiff's suit was dismissed because she failed to state a claim upon which relief could be granted.
On December 12, 1985, plaintiff sued Odette, alleging that he committed malpractice by failing to investigate and timely pursue plaintiff's dram-shop claim against FAD and to inform plaintiff of the same. Plaintiff also sued Hippinsteel, alleging social-host liability.
On June 7, 1986, defendant Odette's attorney arranged for a deposition of Wally Jones, an officer of FAD. Jones was instructed to bring all records concerning the hall rental to McKay with him. At the deposition, it was learned that McKay provided the alcohol at the reception and FAD retained no control over the hall.
Thereafter, defendant Odette moved for summary disposition, claiming that there was no genuine issue of material fact concerning FAD'S lack of responsibility for furnishing the intoxicating beverages. Plaintiff conceded that she no longer had a dramshop action against FAD; however, plaintiff then claimed that defendant Odette committed malpractice by failing to pursue a social-host claim against McKay, MCL 436.33; MSA 18.1004. Defendant Odette responded that plaintiff had not properly pled that theory and that the period of limitation on legal malpractice regarding that claim had expired. Moreover, defendant Odette noted that the three-year period of limitation on the social-host claim had not expired when plaintiff retained her present counsel. Finally, defendant Odette noted that, under the facts of this case, McKay did not "knowingly furnish" alcohol to Gildner. Plaintiff responded by asking that she be allowed to amend her complaint.
AS noted above, the trial court held for defendant Odette, finding: (1) plaintiff conceded defendant was entitled to summary disposition regarding his failure to pursue a dramshop action against FAD; (2) plaintiff's complaint failed to state any other cause of action under the dramshop act; (3) plaintiff could not amend her complaint to allege a social-host theory because the statutory period of limitation for legal malpractice with respect to that claim had expired; (4) plaintiff's malpractice action was more properly directed against her present attorney, who was hired before the period of limitation on the social-host claim had expired; and (5) there was no merit to a social-host claim against McKay.
Plaintiff moved for a rehearing, alleging that the trial court had ignored her request to amend. The trial court denied plaintiff's motion, noting that it had not ignored plaintiff's request as evidenced by the last three reasons in its opinion. Thereafter, Hippinsteel was dismissed as a defendant.
A motion for summary disposition under MCR 2.116(C)(10) tests the factual support for a claim. Morganroth v Whitall, 161 Mich. App. 785, 788; 411 N.W.2d 859 (1987). In ruling on such a motion the trial court must consider not only the pleadings, but also depositions, affidavits, admissions and other documentary evidence. Id. Summary disposition is appropriate under this subrule only if the court is satisfied that it is impossible for the nonmoving party's claim to be supported at trial because of a deficiency which cannot be overcome. Id. The trial court must give the benefit of any reasonable doubt to the nonmoving party. Id. This Court is liberal in finding a genuine issue of material fact. Id. Nonetheless, where the opposing party fails to come forward with evidence, beyond his allegations or denials in the pleadings, to establish the existence of a material factual dispute, the motion is properly granted. Id.
On appeal, plaintiff claims that she should have been allowed to amend her complaint to allege malpractice arising out of defendant Odette's failure to pursue a social-host claim against McKay. MCR 2.118(A)(2). A motion to amend a complaint should be denied only for particularized reasons such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, and the futility of the amendment. Ben P Fyke Sons v Gunter Co, 390 Mich. 649, 656; 213 N.W.2d 134 (1973); Davis v Chrysler Corp, 151 Mich. App. 463, 473-474; 391 N.W.2d 376 (1986), lv den 428 Mich. 869 (1987). The mere expiration of a limitation period does not amount to prejudice where the amendment springs from the conduct, transaction, or occurrences set forth, or attempted to be set forth, in the original pleading because, under such circumstances, the amendment relates back to the date the original pleading was filed. MCR 2.118(D). Davis, supra, pp 473-475; Pierson v Pierson, 132 Mich. App. 667, 670-671; 347 N.W.2d 779 (1984). The trial court's decision to disallow the amendment will not be reversed absent an abuse of discretion. Id.
We first agree with defendant Odette and the trial court that plaintiff did not set forth in her original pleadings a malpractice claim based upon the failure to file a social-host claim. The trial court apparently ruled that plaintiff could not amend her complaint to allege defendant Odette's legal malpractice in failing to pursue a social-host claim, finding that defendant Odette would be prejudiced because the period of limitation for bringing a legal malpractice claim had expired as to defendant's failure to pursue a social-host claim against McKay. As noted above, the mere expiration of a period of limitation does not amount to prejudice where the amendment relates back to the date the complaint was filed because it springs from the conduct set forth or attempted to be set forth in the complaint. Id. We agree with plaintiff that the conduct originally set forth or attempted to be set forth was defendant Odette's malpractice regarding his representation of plaintiff arising out of the accident; therefore, we agree that plaintiff's social-host claim would relate back to the date of her complaint. Id. MCR 2.118(D).
We now turn to the issues of whether plaintiff was dilatory in filing her amendment or whether defendant Odette was prejudiced because he would have to defend against a new claim (e.g., obtain different evidence or witnesses). We do not believe that plaintiff was dilatory or that defendant Odette was prejudiced by the amendment given that defendant Odette's attorney was present when it was disclosed that McKay rather than FAD would have been responsible for providing alcoholic beverages to minors. Davis, supra.
The remaining issues are whether plaintiff's amendment was futile because her new attorney failed to file a social-host claim against McKay despite having the case for four months before the period of limitation on that claim expired or whether the facts disclosed during depositions revealed that plaintiff did not have a viable social-host claim against McKay. We agree with defendant Odette that he cannot be held liable for failing to file a social-host action prior to expiration of the period of limitation where he ceased to represent plaintiff and was replaced by other counsel before the statutory period ran on her underlying action. See Steketee v Lintz, Williams Rothberg, 38 Cal.3d 46, 57; 210 Cal.Rptr. 781; 694 P.2d 1153 (1985).
At this point, we note that Longstreth v Gensel, 423 Mich. 675; 377 N.W.2d 804 (1985), which held that a civil cause of action exists for injuries or death caused by the furnishing of alcoholic beverages to minors by a social host, was decided on November 27, 1985, only after the period of limitation regarding social-host liability had expired in this case. Our Supreme Court held that MCL 436.33; MSA 18.1004 applies to all persons and not merely liquor licensees and retailers and, therefore, violation of that penal statute creates a rebuttable presumption of negligence. Prior to our Supreme Court's decision in Longstreth, supra, this Court had held that violation of MCL 750.141a; MSA 28.336(1), which made it a misdemeanor for any person to knowingly give or furnish alcoholic beverages to minors, was negligence per se or gave rise to a prima facie case of negligence. Compare Thaut v Finley (On Rehearing), 50 Mich. App. 611; 213 N.W.2d 820 (1973), and Lover v Sampson, 44 Mich. App. 173; 205 N.W.2d 69 (1972), with Christensen v Parrish, 82 Mich. App. 409; 266 N.W.2d 826 (1978), lv den 403 Mich. 845 (1978). Nonetheless, in both Thaut and Lover, this Court held that the dramshop act applied only to those licensed to sell alcoholic beverages. MCL 750.141a; MSA 28.336(1) was repealed by the Liquor Control Act and was replaced by MCL 436.33; MSA 18.1004 in 1978. On March 29, 1983, this Court held that a civil cause of action did exist for any person's violation of MCL 436.33; MSA 18.1004. Longstreth v Fitzgibbon, 125 Mich. App. 261; 335 N.W.2d 677 (1983), aff'd sub nom Longstreth v Gensel, 423 Mich. 675 (1985). On December 6, 1983, our Supreme Court granted leave as to our decision in Longstreth v Fitzgibbon. 418 Mich. 876 (1983). Because leave was granted, this Court's decision lacked precedential value. People v Phillips, 416 Mich. 63, 74-75; 330 N.W.2d 366 (1982). But now see MCR 7.215(C)(2), effective December 1, 1987. As noted above, our Supreme Court in a four to two decision affirmed this Court's decision on November 27, 1985. The Supreme Court noted that, because it was the first time it had addressed this issue, its opinion was to apply to that case, to cases commenced after issuance of its opinion and to cases pending in the trial and appellate courts. Longstreth v Gensel, supra, p 699. We note that where a judicial interpretation changes settled law our courts favor a rule of limited retroactivity, such as the one applied in Longstreth, supra, p 699. Lawyers Title Ins Corp v Chicago Title Ins Co, 161 Mich. App. 183, 197; 409 N.W.2d 774 (1987). Under these circumstances, we believe that as a matter of law defendant Odette could not be held liable for his failure to file a social-host claim, because the question of whether such a claim existed had not been settled by our court of last resort and there was a reasonable doubt among informed attorneys as to whether such a claim was viable. See, e.g., Martinson Mfg Co, Inc v Seery, 351 N.W.2d 772, 775 (Iowa, 1984), and cases cited therein.
Moreover, we agree that the undisputed testimony adduced during Gildner's and Hippinsteel's depositions demonstrates that McKay did not knowingly furnish Gildner with the beer he consumed. See and compare Longstreth v Gensel, 423 Mich. 675, 694; 377 N.W.2d 804 (1985); People v Lumley, 189 Mich. 613; 155 N.W. 486 (1915); People v Neumann, 85 Mich. 98; 48 N.W. 290 (1891); Reinert v Dolezel, 147 Mich. App. 149; 383 N.W.2d 148 (1985), lv den 424 Mich. 900 (1986); Christensen v Parish, 82 Mich. App. 409; 266 N.W.2d 826 (1978); Thaut v Finley, 47 Mich. App. 542; 209 N.W.2d 695 (1973), vacated Thaut v Finley (On Rehearing), 50 Mich. App. 611; 213 N.W.2d 820 (1973). Because we agree that the proposed amendment of plaintiff's complaint would have been futile for the reasons discussed above, the trial court properly denied plaintiff's motion to amend her malpractice complaint to allege that defendant Odette was negligent in failing to pursue a social-host claim against McKay. Ben P Fyke Sons, supra; Davis, supra.
Finally, we note that plaintiff also alleged that defendant Odette's actions constituted a breach of contract, pointing to a clause in her contingency-fee agreement. We hold that plaintiff's proposed amendment supports only a malpractice claim. See Barnard v Dilley, 134 Mich. App. 375; 350 N.W.2d 887 (1984).
Affirmed.