Powers v. Hayes

Powers v. Hayes (2000-033); 172 Vt. 535; 776 A.2d 374

[Filed 01-Mar-2001]


                                 ENTRY ORDER

                      SUPREME COURT DOCKET NO. 2000-033

                             JANUARY TERM, 2001


Rachel Powers	                       }	APPEALED FROM:
                                       }
                                       }
v.	                               }	Washington Superior Court
                                       }	
Katherine A. Hayes, Esq.	       }
Barr, Sternberg & Moss, P.C.	       }	DOCKET NO. 497-9-98 Wncv

                                                Trial Judges: Alden T. Bryan 
                                                (Ret.), Specially Assigned and 
                                                Mary Miles Teachout

             In the above-entitled cause, the Clerk will enter:


       Plaintiff Rachel Powers, administrator of the Estate of Charles
  Powers, appeals from a ruling  of the Washington Superior Court that
  granted summary judgment to defendants Katherine Hayes  and the firm of
  Barr, Sternberg & Moss P.C., dismissing plaintiff's attorney malpractice
  action.   Plaintiff argues that the grant of summary judgment was in error
  because there existed enough  circumstantial evidence to create a genuine
  issue of material fact regarding the issue of causation.   We agree and
  reverse.

       On the eve of major surgery, Charles Powers hired attorney Hayes to
  draft a will that would  leave all of his assets to his daughter Rachel
  Powers.  He had used the services of Hayes in the past  and had a working
  relationship with her.  The meeting to draft the will was very hurried
  because  Hayes was leaving for an appointment outside of the office, and
  she suggested that the two meet at a  later date in order to review
  Powers's estate plan in more detail.  Powers rejected the suggestion 
  because he was going into surgery the next day and needed to get the will
  drafted and executed as  soon as possible.  Hayes drafted the will, and it
  was executed that same day.  Powers made it clear to  Hayes that he wished
  his daughter Rachel to receive "everything."

       The bulk of Charles Powers' estate consisted of the assets contained
  in his IRA.  The  beneficiary of the IRA was Colleen Fitzpatrick, Powers'
  ex-girlfriend.  He had been living with her  when the beneficiary
  designation was made, but the relationship had ended by the time he hired 
  Hayes to draft the will.  He had been married and divorced twice and had
  one daughter, Rachel  Powers, from his first marriage.  He was very fond of
  his daughter and sought to provide for her  when he was gone. 

       At the time she drafted the will, Hayes was aware of the existence of
  the IRA from prior 

 

  representation of Powers.  Hayes did not mention the IRA to Powers, but
  drafted the will to  read that he gave to his daughter, "all of my estate
  of every kind and description, both real and  personal, wherever situated
  and whenever or however acquired."  Powers died about two months  after the
  surgery.  Because he had not changed the beneficiary of his IRA, it passed
  to Colleen  Fitzpatrick, and not to his daughter, despite the presence of
  the will.

       Plaintiff brought this attorney malpractice action, alleging that
  Hayes was negligent in failing  to inform Powers that he had to change the
  beneficiary of the IRA to redirect it to his daughter and  that the will
  would not affect the disposition of the IRA.  Defendants moved for summary
  judgment,  relying in part on the deposition of David Frank, who was
  Powers's investment advisor on the IRA.   Frank testified at his deposition
  that he had told Powers that he should change the beneficiary on the  IRA,
  repeatedly encouraged him to do so and sent him a change of beneficiary
  form to complete.  At  the same time, Frank encouraged Powers to obtain a
  will.  While he told Powers that the purpose of  the IRA beneficiary change
  was to ensure that the daughter received one hundred per cent of the IRA 
  proceeds, he never discussed with Powers the interrelationship between the
  will and the IRA  beneficiary designation.

       Defendants argued, and the superior court apparently accepted, that
  plaintiff was unable to  show that any negligence of Hayes was the
  proximate cause of the daughter's loss of the IRA  proceeds.  Specifically,
  defendant argued that the Frank deposition showed that Powers knew that he 
  had to change the IRA designation in order to get the proceeds to his
  daughter and further advice  to  that effect from Hayes would have been
  duplicative and unsuccessful.   

       This Court reviews a motion for summary judgment using the same
  standard as the trial court.  O'Donnell v. Bank of Vermont, 166 Vt. 221,
  224, 692 A.2d 1212, 1214 (1997).  Summary judgment  is appropriate when the
  record indicates that there is no genuine issue of material fact, and that
  the  movant is entitled to judgment as a matter of law.  Politi v. Tyler,
  170 Vt.__, __,751 A.2d 788, 790  (2000); V.R.C.P. 56(c)(3).  In determining
  whether a genuine issue of material fact exists, the court  regards as true
  all allegations of the nonmoving party supported by admissible evidence and
  gives the  nonmoving party the benefit of all reasonable doubts and
  inferences.  Politi, 170 Vt. at__, 751 A.2d  at 790-91; see also Haynes v.
  Golub Corp., 166 Vt. 228, 233, 692 A.2d 377, 380 (1997).

       In order to recover on a legal malpractice claim, plaintiff must prove
  both that defendant was  negligent and that the negligence was the
  proximate cause of plaintiff's harm.  Knott v. Pratt, 158 Vt.  334, 335,
  609 A.2d 232, 233 (1992); see also Brown v. Kelly, 140 Vt. 336, 338, 437 A.2d 1103,  1104 (1981).  In this case, defendants do not contest that
  there is a genuine issue of fact whether  Hayes was negligent; they argue
  that plaintiff cannot prove the causation element.  

       We conclude that there is a genuine issue of material fact with
  respect to causation.  Plaintiff  has produced sufficient circumstantial
  evidence to show that Powers would have changed his IRA  beneficiary had he
  known it was necessary to accomplish his goals after he signed the will. 
  There is  evidence in the depositions that Powers expressed the desire to
  leave "all" his assets to his daughter,  that he told Hayes that this was
  his intent, that he told his daughter that she would inherit 


 

  everything, and that he had affection for his daughter and disliked his
  former girlfriend.  The  language of the will is comprehensive and suggests
  it covers all property Powers owned.  Hayes  conceded that she did not
  discuss the IRA issue with Powers, despite knowing of the presence of the 
  IRA.  Frank never discussed the interrelationship between the will and the
  beneficiary designation  for the IRA.

       Although we have decided no similar case, we find helpful our decision
  in Messier v.  Metropolitan Life Ins. Co., 154 Vt. 406, 408, 578 A.2d 98,
  99 (1990).  In Messier, the insured  actively sought the forms from his
  employer to change the beneficiary on his employer-supplied life  insurance
  contract to his fiancé because he was about to marry her.  He told two
  persons that he had  changed the beneficiary of the policy, and others
  witnessed him filling out the change-of-beneficiary  forms.  However, when
  he died less than two weeks before the wedding, the forms could not be 
  found in his personal possessions or in his personnel file.  Despite the
  fact that there was no direct  evidence that the forms were ever submitted,
  we reversed a grant of summary judgment in a suit  between the fiancé and
  the insured's original beneficiaries, his parents.  We held that the change
  of  beneficiary could be shown by the intent to make the change plus a
  "reasonable effort" to do so, and  that the circumstantial evidence was
  sufficient to show that the insured had made a reasonable effort.  Id. at
  410, 578 A.2d  at 100.  For similar reasons, we hold that the evidence of
  Powers's intent,  coupled with the evidence that he was attempting to act
  on that intent, is sufficient to avoid summary  judgment in this case.  

       Reversed and remanded.



                                       BY THE COURT:



                                       _______________________________________
                                       Jeffrey L. Amestoy, Chief Justice

                                       _______________________________________
                                       John A. Dooley, Associate Justice

                                       _______________________________________
                                       James L. Morse, Associate Justice

                                      _______________________________________
                                      Denise R. Johnson, Associate Justice

                                      _______________________________________
                                      Marilyn S. Skoglund, Associate Justice