LESLIE SMITH v. BETTE R. GRAYSON

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

 

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1072-10T4

A-1460-10T4

LESLIE SMITH,

Plaintiff-Appellant,

v.

BETTE R. GRAYSON, ESQUIRE,

an Attorney at Law of the

State of New Jersey,

Defendant-Respondent.

_________________________________

LESLIE SMITH,

Plaintiff,

v.

BETTE R. GRAYSON, ESQUIRE,

an attorney at law in the

State of New Jersey,

Defendant/Third-Party

Plaintiff-Appellant,

v.

JEFFREY EPSTEIN, ESQUIRE,

an attorney at law in the

State of New Jersey and

WILENTZ, GOLDMAN & SPITZER,

P.A.,

Third-Party Defendants-

Respondents.

Argued October 17, 2011 Decided December 19, 2011

Before Judges Parrillo, Grall and Skillman.

On appeal from Superior Court of New Jersey, LawDivision, Essex County,Docket No.

L-2444-08.

Kenneth S. Thyne argued the cause for appellant in A-1072-10T4 (Roper & Twardowsky, LLC, attorneys;

Mr. Thyne, on the briefs).

Christopher B. Block argued the cause for respondent in A-1072-10T4 and appellant in A-1460-10T4 (Gordon & Rees, LLP, attorneys; Mr. Block, of counsel; Joshua S. Hurwit, on the brief in A-1072-10T4 and Mr. Block, of counsel; Mr. Block and Mr. Hurwit, on the brief in A-1460-10T4).

Richard J. Byrnes argued the cause for respondents Wilentz, Goldman & Spitzer and Jeffrey Epstein, Esquire, in A-1460-10T4 (Wilentz, Goldman, and Spitzer, P.A., attorneys; Frederick J. Dennehy and Mr. Byrnes, of counsel and on the brief).

PER CURIAM

In this legal malpractice action, plaintiff Leslie Smith sued her former attorney, defendant Bette Grayson, alleging professional negligence in advising plaintiff to take an inadequate divorce settlement. Grayson then filed a third-party negligence complaint against Jeffrey Epstein and his former law firm, Wilentz, Goldman, and Spitzer, P.A. (Wilentz), who was retained by plaintiff as a consultant in her then pending divorce action. As part of discovery, plaintiff obtained an expert report from a matrimonial attorney who concluded Grayson was negligent. Following discovery, Grayson sought summary judgment on plaintiff's complaint and to strike plaintiff's expert report as a net opinion. Epstein and Wilentz also sought summary judgment on Grayson's third-party complaint. The trial judge granted both motions and dismissed all claims. As to the former, the court held plaintiff was equitably estopped from suing Grayson because the terms of the settlement had been set forth on the record and plaintiff testified she believed the settlement was fair and equitable. The court also found that plaintiff's expert rendered a net opinion, and, without it, she could not prove breach, causation or damages. In dismissing Grayson's third-party action against Epstein and Wilentz, the court found that there was no expert proof of their professional negligence. Both plaintiff and defendant filed appeals, which were consolidated. For reasons that follow, we affirm the summary judgment dismissal of the third-party action and reverse the dismissal of plaintiff's complaint and remand.

On May 10, 2000, plaintiff retained defendant to obtain a divorce from her husband of twenty-two years, Lorre Smith. At the time, plaintiff, an audiologist, was forty-six years old with an earning history averaging $42,000 per year dating from 2000, the year she returned to full-time work. Her husband was forty-eight years old and an attorney with a solo practice and average reported income of $246,000 for the years 1998 to 2000. There were two children of the marriage born in 1985 and 1989.

Plaintiff filed her divorce complaint in September 2000. By all accounts, the ensuing litigation was acrimonious and contentious, exacerbated by the fact that the couple continued to reside together in the marital home. Frustrated at the pace of the litigation, plaintiff retained Epstein, then of Wilentz, in November 2001. According to plaintiff, Epstein was retained as a "consultant" and he and Grayson were "hired to do two different things." Grayson was to "get the case settled, to get [plaintiff] a fair settlement, or to go to trial." Epstein, meanwhile, was "to propose different settlement agreements that . . . Grayson could revise to help get the case moving along."

Settlement negotiations commenced in June 2001 when the husband proposed limited duration alimony of $28,600 per year for ten years and child support of $300 per week. Plaintiff countered with a demand for $100,000 annual permanent alimony and weekly child support of $850. Privately, Grayson advised plaintiff that given the length of the marriage, she was likely entitled to permanent alimony in the approximate amount of thirty percent of the difference in the couple's respective yearly incomes. Their strategy, then, was to "stop the bleeding" and use permanent alimony as leverage or a bargaining chip to obtain assets for plaintiff to which she otherwise might not be entitled in equitable distribution. Consequently, a draft property settlement agreement, prepared by Epstein on February 14, 2002, provided that plaintiff retain the marital home, appraised at $750,000, less $75,000 representing the husband's share of its equity, in return for agreeing to waive permanent alimony and accepted limited-duration alimony, stepped-down for nine years. See infra at 24, n.7.

On April 3, 2002, plaintiff and Grayson, together with their accountant, appeared in court for a settlement conference. The judge informed the parties that their matter would be transferred to another judge's calendar for trial and that they would not likely receive a trial date until late 2002 or early 2003. All-day settlement talks ensued, with plaintiff's accountant doing most of the back-and-forth shuttling and negotiations.1

At the end of the day, Grayson informed plaintiff that an agreement had been reached and urged her to accept it. The agreement called for, among other things, plaintiff to leave the marital residence and receive $240,000, as her one-half share of the equity in the home; a $90,000 lump sum payment representing plaintiff's interest in her husband's law practice; limited duration alimony of $50,000 per year for five years and $35,000 per year thereafter for four years; and a $50,000 lump sum payment for her waiver of any claim to permanent alimony.

After the settlement was reached, the parties returned to court to explain its terms on the record and give their assent. Plaintiff testified that she understood the settlement, had conferred with Grayson and Epstein, had taken part in negotiations, understood that she was giving up her right to lifetime alimony and voluntarily decided to do so, and believed the settlement was a reasonable one. Plaintiff later confirmed in her deposition that at the time the agreement was reached, she believed she was getting the best settlement possible.

It was not until several years later when plaintiff consulted Epstein on a post-judgment matter in 2006 and Epstein supposedly told her that Grayson should not have recommended the buyout of plaintiff's interest in the house together with the limited-duration alimony that plaintiff suspected defendant of being professionally negligent in her legal representation of plaintiff's divorce. According to plaintiff, her removal from the marital home was not proposed until the very end of the negotiations, "came out of nowhere," and Grayson "encouraged and pushed" her to accept the deal lest she "was never going to get divorced."

In her legal malpractice action filed on March 20, 2008, plaintiff's core complaint against Grayson focused on this change from plaintiff retaining the marital home to having her interest therein bought out by her ex-husband. To this end, plaintiff retained as her expert a matrimonial attorney, who prepared a twenty-two page expert report concluding that Grayson was professionally negligent in not counseling plaintiff to reject the settlement, which was well below the range she would have received at trial. The expert first opined that plaintiff was entitled to permanent alimony based on the applicable factors of N.J.S.A. 2A:34-23, including the length of the marriage, the age of the parties and their comfortable standard of living, and the substantial disparity in their income and earning capacity.

As to the quantum of alimony, the expert pointed to a rule of thumb amongst matrimonial practitioners that alimony should be one-third of the difference in the parties' incomes. Based on the husband's historical earning capacity of between $225,000 and $250,000,2 the expert opined that plaintiff would have been awarded permanent alimony at trial in the range of $60,000 to $72,000 per year. Of course, this figure may be adjusted upwards or downwards depending on the statutory factors. In the expert's view, "in a long-term marriage with older parties, an established standard of living and a large disparity not only in income but in the ability to generate future income, the alimony will be substantially more." An additional consideration weighing in favor of a higher award to plaintiff is the fact that alimony is tax deductible to the payor and taxable to the payee.

Despite the certainty of such an outcome at trial, the expert nevertheless recognized that the parties are "free to negotiate for duration of alimony less than the court would award in a permanent alimony case." In fact, the expert acknowledged that it would have been advantageous for plaintiff in this case to trade permanent alimony for either additional assets in equitable distribution, a higher amount of alimony for a shorter period of time, a satisfactory buyout of the permanent alimony obligation, or any combination of these alternatives, none of which, however, plaintiff obtained in the settlement.

As to one of these options, the expert attempted to calculate the husband's cost to buyout his permanent alimony obligation. According to the expert, the appropriate methodology "would have been to calculate the amount that would otherwise be paid as permanent alimony. This amount is then reduced by the taxes [plaintiff] would be required to pay and is further adjusted by a present value discount factor since she is receiving the money, theoretically, up front." Using this approach, and assuming a seven-year term, the expert calculated the lump sum buyout would be in the range of $225,000 to $300,000. So measured, the expert concluded "[t]here is no justification for the $50,000 payment in lieu of permanent alimony" in this case and that Grayson's failure to engage in this calculation "was a deviation from the standards of matrimonial practice." Instead, the expert concluded, a waiver of the husband's interest in the marital home, assuming his equity share to be $240,000,3 "would have been a reasonable compromise in a settlement." The expert went on to estimate plaintiff's damages in the range from $240,000 to $320,000 plus interest, "based upon a settlement that would have included a waiver of permanent alimony less the $50,000 paid for that waiver, adjustment for the reduced amount of limited duration alimony and consideration of the counsel fee award which [the husband] would have been obligated to pay."

I

The motion judge found that plaintiff's legal malpractice claim was barred as a matter of law by Puder v. Buechel, 183 N.J. 428 (2005), because, like Puder, plaintiff entered into a settlement agreement on the record about which she now complains. The judge also held that plaintiff's expert report in support of her malpractice claim was inadmissible as a mere net opinion. We disagree with both rulings.

Whether Puder's equitable bar applies to this matter is a question of law that we review de novo. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140. N.J. 366, 378 (1995). On this score, the standard in respect of whether a malpractice plaintiff may maintain a suit based on a settlement remains as set forth in Puder's predecessor, Ziegelheim v. Apollo, 128 N.J. 250 (1992), and Puder represents but an equitable exception to Ziegelheim's overarching rule.

In Ziegelheim, an attorney failed to discover approximately $149,000 of marital assets and failed to properly advise his client about what she might have received if she went to trial. 128 N.J. at 255-57. After "extensive negotiations," the client agreed to accept a settlement that she affirmed on the record was fair and equitable. Id. at 257-58. Dissatisfied with the settlement, she later sued her former lawyer for malpractice that culminated in the settlement, id. at 254-58, alleging that because of the attorney's lapses, she agreed to a settlement far less than what she could have obtained had she gone to trial. Id. at 255-57.

Outright rejecting "the rule . . . that a dissatisfied litigant may not recover from his or her attorney for malpractice in negotiating a settlement that the litigant has accepted unless the litigant can prove actual fraud on the part of the attorney[,]" id. at 262, the Court in Ziegelheim concluded that "[t]he fact that a party received a settlement that was 'fair and equitable' does not mean necessarily that the party's attorney was competent or that the party would not have received a more favorable settlement had the party's incompetent attorney been competent." Id. at 265.4 The Court went on to explain that clients rely on their attorneys to advise them what constitutes a "fair" settlement under the circumstances, id. at 263, and that a competent lawyer is obligated to help his client understand "the likelihood of success" of the case and "the range of possible awards in" it, even if the client ultimately chooses another path. Ibid.

That said, the Court did warn, however, that its decision

was not meant to "open the door to malpractice suits by any and every dissatisfied party to a settlement" and that "[m]any such claims could be averted if settlements were explained as a matter of record in open court in proceedings reflecting the understanding and assent of the parties." Id. at 267. With that admonition in mind, the Court, several years later, had occasion to revisit the effect, if any, the settlement of an underlying lawsuit has on a subsequent legal malpractice action arising out of that settled lawsuit.

In Puder, supra, the Court determined that a client's unconditional declaration of satisfaction with the fairness and terms of a settlement of a lawsuit precludes a later legal malpractice action based on that settlement. 183 N.J. at 437. Unlike Ziegelheim, the dissatisfied client in Puder sought to sue her former lawyers over a rejected settlement despite the fact that she retained new lawyers, that those new lawyers negotiated a settlement that was substantially indistinguishable from the earlier rejected settlement, and that the client had represented to the trial court that the settlement was both fair and acceptable to her. Puder, supra, 183 N.J. at 431-36. In those circumstances, the Court, applying equitable principles, carved out a limited exception to the Ziegelheim standard and held that "fairness and the public policy favoring settlements dictate that [the malpractice plaintiff] is bound by her representation to the trial court that the divorce settlement agreement was 'acceptable' and 'fair[,]'" explaining that "[t]hose statements clearly reflect [the malpractice plaintiff]'s satisfaction with the resolution of her [prior litigation], and, therefore, preclude her malpractice claim against her former counsel." Id. at 437.

In other words, unlike the plaintiff in Ziegelheim, the client in Puder had reason to know of her attorney's negligence and "entered into the second [materially indistinguishable] settlement admittedly aware of the discovery deficiencies leading up to the first settlement." Id. at 443; see Schulman v. Wolff & Samson, P.C., 401 N.J. Super. 467, 475 (App. Div.) (noting that in Puder, the client was "fully aware of" her attorney's negligence "before entering into the final settlement . . . ."), certif. denied, 196 N.J. 600 (2008). Indeed, the Court in Puder expressly reasoned that Ziegelheim "discourages malpractice litigation when a court finds that a plaintiff, although well aware that the attorney was negligent, nevertheless testifies under oath that the settlement was both acceptable and fair." 183 N.J. at 443.

Puder, in turn, cited approvingly our decision in Newell v. Hudson, 376 N.J. Super. 29 (App. Div. 2005), where according to the Court's characterization the plaintiff, an accountant by education who performs internal auditing for a corporation, "was completely aware of the alleged financial shortcomings of the settlement when she willingly entered into the agreement." Puder, supra, 183 N.J. at 444. Thus, to allow a client to sue an attorney for malpractice where the client knew the settlement was deficient but nonetheless affirmed that it was a fair compromise would allow the client to "potentially profit from litigation positions that are "clearly inconsistent and uttered to obtain judicial advantage." Ibid. (internal quotations omitted).

The most recent examination of the issue occurred in Guido v. Duane Morris LLP, 202 N.J. 79 (2010), wherein the Court dispelled any possible tension between Puder and Ziegelheim, explaining "Puder represents not a new rule, but an equity-based exception to Ziegelheim's general rule[,]" id. at 94, which applies if required "'to prevent injustice by not permitting a party to repudiate a course of action on which another party has relied to his detriment[,]'" ibid. (internal citation omitted) or to ensure that "a party [who] has prevailed on a litigated point" be "bound by its earlier representations" to protect the integrity of the judicial process. Ibid. But if these equitable considerations are not present, Ziegelheim's "overarching rule" applies. Id. at 96.

In Guido, there was a genuine issue of material fact as to whether or not the defendants adequately advised plaintiffs of the impact the voting agreement would have on the value of their shares, and whether or not the failure to do so constitutes legal malpractice. 202 N.J. at 95. Unlike the plaintiff in Puder who had reason to know of her attorney's negligence, the plaintiff in Guido "specifically contend[ed] that he was not aware of the effect the restrictions on the sale of stock and other provisions of the voting agreement would have on the value of his investment at the time he agreed to the settlement of the General Equity action" and that defendants "were negligent in failing to advise him in that regard." Id. at 89.

In sum, Puder's equitable bar only applies when a client knows that her attorney may have been negligent in connection with a settlement but nevertheless testifies that the settlement is satisfactory to her. Where, on the other hand, such an equitable consideration is absent, and there are facts, albeit disputed, in support of a claim of attorney negligence, the legal malpractice claim may proceed despite the client having agreed on the record to settle the underlying divorce action. In such circumstances, the existence of a settlement agreement does not operate to automatically preclude a client from alleging that her attorney's advice led her to accept an inadequate settlement. Consequently, the motion judge erred in dismissing plaintiff's legal malpractice complaint under the mistaken view that Puder required such a result. Simply put, the equitable considerations present in Puder are absent here and plaintiff should therefore be able to proceed on her cause of action to prove she unknowingly entered into an inadequate settlement, believing it is fair, as a result of the arguable negligence of her matrimonial attorney.

II

Having decided that there is no per se bar to plaintiff's lawsuit, we now address whether the facts of record support plaintiff's claim of attorney negligence in order to defeat defendant's summary judgment motion, in particular, whether plaintiff's expert rendered a net opinion as determined by the motion judge. For reasons that follow, we find the court's evidential ruling to be a mistaken exercise of its discretion.

N.J.R.E. 703 requires that an expert's opinion be based on "facts or data" lest it be inadmissible as a "net opinion." Polzo v. Cnty. of Essex, 196 N.J. 569, 583 (2008). The net opinion rule has been succinctly defined as "a prohibition against speculative testimony." Grzanka v. Pfeifer, 301 N.J. Super. 563, 580 (App. Div.), certif. denied, 154 N.J. 607 (1997); see also Vuocolo v. Diamond Shamrock Chems. Co., 240 N.J. Super. 289, 300 (App. Div.), certif. denied, 122 N.J. 333 (1990). An expert is required to give the "why and wherefore" of his opinion, not just a mere conclusion. Jimenez v. GNOC, Corp., 286 N.J. Super. 533, 540 (App. Div.), certif. denied, 145 N.J. 374 (1996); see also Rosenberg v. Tavorath, 352 N.J. Super. 385, 401 (App. Div. 2002); accord Kaplan v. Skoloff & Wolfe, P.C., 339 N.J. Super. 97, 102 (App. Div. 2001) (stating the rule in a legal malpractice case). When an expert opinion "'is based merely on unfounded speculation and [unqualified] possibilities,'" Grzanka, supra, 301 N.J. Super. at 580 (quoting Vuocolo, supra, 240 N.J. Super. at 300), or is unsupported by factual evidence, it is inadmissible. Jimenez, supra, 286 N.J. Super. at 540. Consequently, experts must "identify the factual bases for their conclusions, explain their methodology, and demonstrate that both the factual bases and the methodology are

. . . reliable." Koruba v. Am. Honda Motor Co., 396 N.J. Super. 517, 526 (App. Div. 2007), certif. denied, 194 N.J. 272 (2008). They must be able to point to generally accepted, objective standards of practice and not merely standards personal to them. Ibid. We review a trial court's determination that an expert's opinion is net for an abuse of discretion. Riley v. Kennan, 406 N.J. Super. 281, 295 (App. Div.), certif. denied, 200 N.J. 207 (2009).

In challenging the expert's opinion in this case as "net," Grayson contends the expert failed to explain (1) why plaintiff would have received permanent alimony had she gone to trial; (2) the basis for her projection as to the quantum of the annual award; (3) how she calculated the worth of a lump sum buyout of that award as well as plaintiff's resultant damages. We disagree.

First and foremost, the expert articulated the legal duty an attorney owes a client, supported by citation to case law and the rules of professional conduct. In particular, the expert relied on Ziegelheim, supra, involving a claim of legal malpractice arising out of a matrimonial matter, which held that "lawyers owe a duty to their clients to provide their services with reasonable knowledge, skill and diligence . . . .

[Necessary] steps [in the proper handling of the case] will include, among other things, a careful investigation of the facts of the matter, the formulation of a legal strategy, the filing of appropriate papers, and the maintenance of communication with the client." 128 N.J. at 260-61.

The expert then measured Grayson's performance in the representation of plaintiff against the objective standard of matrimonial practice to determine whether there was a breach of the legal duty owed her client. In doing so, the expert first determined that, under the specific facts and circumstances presented, plaintiff would have been entitled to permanent alimony given her age, income, earning capacity and financial needs; her husband's ability to pay; the marital standard of living; and, most significantly, the long duration of the marriage. On this score, in her report, the expert analyzed all applicable factors of N.J.S.A. 2A:34-23 relevant in this instance to the determination of the type of alimony to be awarded and, in her deposition, further explained why other statutory considerations either did not apply or were entitled to little weight.5

Of all the statutory factors implicated, the expert placed greatest weight on the long duration of the marriage, based, in part, on our decision in Cox v. Cox, 335 N.J. Super. 465 (App. Div. 2000), which held that because a parties' marriage was a 22-year marriage, permanent alimony should have been awarded absent a clear statement of reasons to the contrary, N.J.S.A. 2A:34-23(b), (c). Id. at 483. Most tellingly, the expert added that even the husband's counsel admitted this was a permanent alimony case. Thus, for all those reasons, the expert opined that in applying the pertinent factors of N.J.S.A. 2A:34-23 and the rationale of Cox, a court would award permanent alimony to plaintiff given the couple's long-term marriage, her former husband's significant income and earning capacity, and their comfortable marital standard of living.

Consequently, the expert opined that the accepted standard of care required Grayson to recognize that plaintiff would be entitled to permanent alimony and to act accordingly. So measured, the expert concluded that the settlement in this case was substantially below the range of award she most likely would have received at trial because plaintiff waived her entitlement to permanent alimony in exchange for a lump sum $50,000 payment; gave up her right to receive an award of counsel fees for no apparent consideration; and abandoned her option to retain the marital home worth $720,000 for only her rightful one-half share of the equity therein.

The expert laid the foundation for this conclusion, detailing step-by-step the methodology she employed. Before quantifying the amount of anticipated alimony to be awarded at trial, the expert correctly recognized citing Crews v. Crews, 164 N.J. 11 (2000), and Lepis v. Lepis, 83 N.J. 139 (1980) that the purpose of alimony is to allow the dependent spouse to enjoy the standard of living she had during the marriage and that the other spouse should pay alimony in that amount, if he is able to. The expert then estimated the range of yearly permanent alimony to be between $65,000 and $72,000 based on each party's historical earnings and utilization of a formula widely accepted amongst members of the matrimonial bar.

As to the former, the expert used the average of the husband's income over several years to account for spikes and dips in his solo law practice, and arrived at a range of between $200,000 and $250,000 annually. Plaintiff, on the other hand, after returning to work in 1999, averaged about $42,000 per year. The expert then derived a yearly alimony figure by taking one-third of the difference between the spouses' incomes. In doing so, the expert relied on a generally accepted objective standard of matrimonial attorney practice and not simply a standard personal to her. See Fernandez v. Baruch, 52 N.J. 127, 131 (1968). She also opined, based on her experience, that the ultimate alimony award would be in the higher estimated range because the weight of statutory factors the couple's age, established standard of living, and large disparity in income and earning capacity heavily favored plaintiff and therefore justified the upward adjustment.6

From there, the expert estimated that a lump-sum buyout of plaintiff's anticipated permanent alimony award would have been $225,000 to $300,000. Once again, she detailed the basis for her calculation, which was dependent in part upon the estimated amount of annual alimony and the number of years of alimony. In her report, the expert expressly states that the "appropriate methodology would have been to calculate the amount that would otherwise be paid as permanent alimony. This amount is then reduced by the taxes [plaintiff] would be required to pay and is further adjusted by a present value discount factor since she is receiving the money, theoretically, up front."

Utilizing this approach, the expert multiplied what she calculated to be a fair, yearly amount of alimony ($65,000 to $72,000) by the number of years until the husband retired. In this regard, she assumed a normal retirement age of 65 or 66, and therefore used a conservative seven-year remaining term. Since alimony is taxable to the payee, the expert then deducted from the total alimony figure the amount plaintiff would have paid in taxes, and assumed, in this respect, a 28 percent tax rate. Moreover, because damages for future expenses must be discounted to present value, Green v. General Motors Corp., 310 N.J. Super. 507 n.20 (App. Div.), certif. denied, 156 N.J. 381 (2008), the expert further adjusted the figure downward by an interest factor, using a computer program standard in the profession. Because her figures on the yearly alimony were expressed as a range, so was the amount of her estimated lump sum buyout.

The expert calculated the value of the permanent alimony buyout, in part, to determine whether Grayson was negligent in recommending that plaintiff accept the $50,000 lump sum buyout feature of the settlement agreement. On this score, the expert compared the settlement figure not only to her own estimated range of $225,000 to $300,000, but as well to the $165,000 price tag in Epstein's original proposal.7 Regardless of the calculation used, the point emphasized by the expert is that Grayson failed to recognize plaintiff's entitlement to permanent alimony and therefore neglected to calculate the value or worth of plaintiff's waiver thereof. Indeed, according to the expert, not only did Grayson fail to estimate the cost of a reasonable lump sum buyout, she advocated a woefully inadequate amount. In the expert's view, at the very least, "a waiver of the [husband's] interest in the [marital] home would have been a reasonable compromise in the settlement."

In fact, plaintiff's strategy from the outset had been to use her right to permanent alimony as leverage or in exchange for securing more assets in equitable distribution (i.e. the marital home) or a higher limited duration alimony award. She got neither. Instead, according to the expert, the settlement, inexplicably and incredibly, got turned "upside down":

instead of [plaintiff] getting the house, [husband] would buy her out. He simply flipped the deal: instead of [plaintiff] keeping the house and paying [husband] $75,000, he gets the house, pay [plaintiff] her half of the equity and instead of [plaintiff] paying him $75,000, [he's] going to be [a] nice guy and throw in an additional $50,000. . . . Grayson simply forgot that the entire point of [plaintiff] getting the equity in the house was to compensate her for the waiver of alimony. This is a stunning lapse and a deviation from the standard of care owed by . . . Grayson to her client.

 

In other words, Grayson allowed the settlement negotiation to be "flipped," in which plaintiff yielded both her right to permanent alimony and her retention of the marital home due to her attorney's failure to give her proper advice. Compounding the matter, Grayson "also negotiated away a $25,000 award of counsel fees to [plaintiff] pursuant to a court order without any apparent consideration." Moreover, "there was no significant enhancement in child support that would justify the $50,000 for a waiver of permanent alimony . . . . Based upon the current Guidelines, [husband] agreed to pay child support that represented a slight deviation from the Guidelines but was not sufficient to justify the alimony waiver."

Having set forth with particularity the legal duty owed plaintiff and the breach thereof, the expert went on to estimate the damages caused by Grayson's deviation and to describe how she calculated the range of award $240,000 to $320,000 plaintiff would have received had the settlement reflected her likelihood of recovery at trial. To that end, the expert derived a figure based on the calculated buyout cost "less the $50,000 [actually] paid for that waiver, adjustment for the reduced alimony of limited duration alimony and consideration of the counsel fee award which [husband] would have been obligated to pay."

As is evident, the expert report states much more than a bare conclusion and contains the requisite "why and wherefore" of her opinion. The expert properly identifies the facts and data on which her opinion is founded; accurately analyzes the relevant law, both statutory and common; correctly describes the generally accepted professional standard; and adequately explains the methodology employed in ascertaining breach and measuring damages.

To be sure, alimony calculations, by their very nature, are inexact, but such imprecision does not render any less valid the expert's use of her knowledge and experience in the matrimonial field to estimate the range of an alimony award she would have received had she rejected the settlement agreement and proceeded to trial. By the same token, while the type of alimony awarded is broadly discretionary, Steneken v. Steneken, 367 N.J. Super. 427, 434 (App. Div. 2004), aff d as mod., 183 N.J. 290 (2005), that discretion is not limitless and the expert here has provided sufficient guidance to aid the trier of fact in a legal malpractice action to understand how that discretion may have been exercised in the underlying divorce trial.

Admittedly, the expert opinion at issue here is not without challenge. But the deficiencies identified by defendant go to the weight, rather than the admissibility, of this proof, and are appropriate for attack on cross-examination. After all, an expert's opinion "is not inadmissible merely because it fails to account for some particular condition or fact which the adversary considers relevant." State v. Freeman, 223 N.J. Super. 92, 116 (App. Div. 1988), certif. denied, 114 N.J. 525 (1989). Rather, "[t]he adversary may on cross-examination supply the omitted conditions or facts and then ask the expert if his opinion would be changed or modified by them." Ibid. So too, the fact that alimony awards may contain a subjective element does not render them undeterminable. "Mere difficulty or lack of certainty in the proof or finding of the quantum of damages does not inhibit an award to the successful party." Donovan v. Bachstat, 181 N.J. Super. 367, 374 (App. Div. 1981) (internal quotations omitted), modified, 91 N.J. 434 (1982).

For all of these reasons then, we conclude that the expert opinion in this case contains the requisite factual foundation and therefore the motion court mistakenly exercised its discretion in disallowing its admission into evidence.

 

 

III

We now turn to Grayson's appeal of the motion judge's grant of summary judgment to Epstein and Wilentz, wherein she argues that there is a question of material fact as to Epstein's role in plaintiff's divorce that bars dismissal of her third-party complaint. We need not determine whether the proofs of Epstein's involvement are sufficient to raise a genuine factual dispute because whatever his role, Grayson has offered no competent expert evidence of the duty he owed plaintiff or any breach thereof, or whether any such breach substantially contributed to her loss.

On this score, Grayson relies on Connell, Foley, & Geiser, LLP v. Israel Travel Advisory Service, Inc., 377 N.J. Super. 350, 364 (App. Div.), certif. denied, 185 N.J. 298 (2005) for the proposition that "co-counsel should . . . be entitled to contribution when only one of them is sued with regard to a case both were handling at the same time." In Connell, Foley, the law firm seeking contribution was local counsel to an out-of-state law firm. Id. at 354. Thus, both local counsel and the out-of-state law firm were held responsible for the conduct of the whole case; the out-of-state law firm helped prepare for trial, attended trial, drafted papers and consistently discussed strategy and conduct with the local firm. Ibid.

In contrast here, the proofs indisputably established that Epstein's role was considerably more limited than defendants.

Plaintiff labeled him a "consultant" and stated that he and Grayson were "hired to do two different things." Grayson was to "get the case settled, to get [plaintiff] a fair settlement, or to go to trial." Epstein, on the other hand, was "to propose different settlement agreements that . . . Grayson could revise to help get the case moving along." Similarly, Epstein understood he was "primarily to participate in . . . mediation in the hopes to resolve the matter amicably[,]" and that his representation was "sort of as a secondary role" that did not involve litigating the case or going to court. Even Grayson, who now claims Epstein was co-counsel, understood that Epstein was engaged "to help facilitate a settlement" and described their arrangement as plaintiff being "represented by" Grayson with the "consultation of" Epstein. Indeed, plaintiff wanted Epstein to take over responsibility for the whole case, but he expressly refused, stating that it would cost too much to bring himself up to speed on the file.

We have previously approved of arrangements where attorneys take on less-than-complete representation of a client. Lerner v. Laufer, 359 N.J. Super. 201, 217-18 (App. Div.), certif. denied, 177 N.J. 223 (2003). In such cases, the degree of care owed by the attorney providing the limited services "is framed by the agreed service." Id. at 217; see also Ziegelheim, supra, 128 N.J. at 260 ("What constitutes a reasonable degree of care is not to be considered in a vacuum but with reference to the type of service the attorney undertakes to perform." (internal quotations omitted)).

"Because the duties a lawyer owes to his client are not known by the average juror, a plaintiff will usually have to present expert testimony defining the duty and explaining the breach[,]" Stoeckel v. Township of Knowlton, 387 N.J. Super. 1, 14 (App. Div.), certif. denied, 188 N.J. 489 (2006); see also Sommers v. McKinney, 287 N.J. Super. 1, 10 (App. Div. 1996), as well as its causal connection to the plaintiff's damages, Vort v. Hollander, 257 N.J. Super. 56, 61 (App. Div.), certif. denied, 130 N.J. 599 (1992). And to be admissible in evidence, the expert's opinion must be based on professional standards accepted by the legal community, Kaplan v. Skoloff & Wolfe, P.C., 339 N.J. Super. 97, 103 (App. Div. 2001), of which the lay public is also unaware. Thus, in dismissing the third-party complaint on summary judgment, the motion judge properly concluded that Grayson could not establish a prima facie case of legal malpractice against Epstein and Wilentz without obtaining her own expert opinion focused on their duty of care and breach.

The summary judgment dismissal of defendant's third-party complaint is affirmed. The summary judgment dismissal of plaintiff's complaint is reversed and the matter is remanded for further proceedings in accordance with this opinion.

1 Epstein was not present in court and his involvement in the negotiations that date is disputed. According to plaintiff, Epstein was not involved at all. However, Epstein's time sheet reflects a telephone conversation with plaintiff's accountant on April 3 with the notation "re: settlement." Epstein had no recollection of the call and the accountant was not deposed.

2 According to the expert:

[T]his matter is unclear as to what [the husband's] actual income was at the time of the divorce. In her deposition, . . . Grayson stated that [his] income was around $194,000. One of the draft[] agreements prepared by . . . Epstein refers to [his] "base salary" of $200,000 which did not include contributions to his pension plan. There are references to spikes in [his] income due to his acquisition of a disbarred lawyer's practice and there is a reference to a "big hit" in 2001 and a concern that he would show a much lower number in 2002. [The husband's] reported income and adjusted income on the Rosenfarb Winters schedule do not support this. The only spike in [his] income seems to have been in 2006; his average income . . . or in the adjusted income per Rosenfarb Winters was in the neighborhood of $250,000. I have not been presented with any information as to [the husband's] income in 2001 or 2002 but his Schedule C income for 2003 was $197,668, which does not include perqs.

3 Throughout her expert report and later in her deposition without objection from defense counsel, plaintiff's expert, save for one exception, consistently refers to $240,000 as representing each divorce party's one-half equity share in the marital home, for a total equity of $480,000. In one instance, however, the expert mentions a net equity of $280,000, but then goes on to deduce from that figure that each party would therefore be entitled to $240,000. Obviously then, the $280,000 figure is a typographical error, meant to read $480,000 instead.

4 Even the dissenter "agree[d] entirely with the Court that a party's expression of satisfaction with the terms of the settlement of a matrimonial action does not end the matter that is, standing alone it does not constitute an absolute bar to a malpractice action against the lawyer." Id. at 269 (Clifford, J., dissenting in part).

5 For instance, according to the expert, judges apply the "health" factor to a spouse laboring under a physical or mental disability requiring support from the other and since there was no evidence that either party in this case had a disability, this particular consideration would not influence a judge's decision. Similarly, occurrences during the pendente lite period when plaintiff and her husband lived together would not influence the judge's final alimony award.

6 The expert expounded in deposition:

I look at what he's earning. I'm looking at what she's earning. I'm looking at the standard of living during the marriage, and I'm basically looking at how judges approach alimony. It depends, in part, upon what he feels the income actually is, and it also depends upon what he sees as the needs of the parties.

7 According to the expert, Epstein's initial draft proposal called for plaintiff to retain the marital residence valued at $750,000 with each party entitled to his/her respective equity share of $240,000 and plaintiff to pay her husband $75,000 from her share, leaving $165,000 as the consideration for plaintiff's waiver of permanent alimony. Although the expert opined that the $165,000 figure "is on the extreme low end of the spectrum [of consideration]," it "certainly [is] not an unreasonable number for the waiver of alimony."