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In Unpublished Decision Ninth Circuit Reinstates Legal Malpractice Claim

The case, Nancy Setterquist v. Law Offices of Ted D. Billbe, P.C., N0. 18-35880, is an unpublished decision of the Ninth Circuit that raises important issues. The case is a divorce malpractice case. Setterquist alleged that her lawyer allowed the court to enter an erroneous order. Based on the text of that order, her ex-husband filed a post-decree claim against her for maintenance and was able to recover. The facts are not summarized well in the opinion, unfortunately, leaving me with questions about what happened and why it happened.

The defense strategy was to move to dismiss on the basis that Setterquist engaged a new lawyer post-decree. The defense argued in a motion to dismiss that successor counsel could have corrected the error made by Billbe and defeated ex-husband’s claims.

The district court dismissed the case on the basis that Setterquist could not allege proximate causation because she employed successor counsel.

The Ninth Circuit reversed, holding that the motion to dismiss should have been denied. Why? The court reasoned that successor counsel did enough work on the case to avoid being a break in the chain of causation.

The reasoning:

The conduct of plaintiff and her replacement counsel “does not necessarily mean that [the alleged inaction] was the sole and superseding cause of [her] injuries.” Rabbage v. Lorella, 426 P.3d 768, 775 (Wash. App. 2018). Rather, “causation remain[s] an open question for the jury because if the original attorney had not acted negligently, the successor attorney would not have needed to remedy the error.” Id.

We need not decide whether the state court should have granted plaintiff’s motion to correct the decree of dissolution pursuant to Washington Superior Court Civil Rule 60(b)(11) in these circumstances. For the reasons explained above, even assuming that relief under 60(b)(11) would have been appropriate, the failure to challenge the trial court’s denial of the motion does not necessarily break the chain of causation to defendants’ initial error. Nor would 60(b)(11) have been the sole avenue through which the state court could have acted to alleviate plaintiff’s alleged injury. The dissolution decree stated that “[s]pousal support is non-modifiable, except if wife’s father passes away, husband may seek to modify maintenance.” (emphasis added). In other words, the state court had discretion to grant or deny the petition to modify spousal support irrespective of whether the dissolution decree could have been amended under 60(b)(11).

Finally, even though plaintiff and her replacement counsel failed to take certain steps to seek revision of the petition for modification or renew the motion to correct the decree—even when the state court judge specifically invited them to do so—they were not complacent. Plaintiff’s replacement counsel filed a trial brief contesting the petition of plaintiff’s former husband to modify spousal support, albeit for reasons other than the enforceability of the CR 2A Agreement. Moreover, plaintiff contacted defendant Ted Billbe to offer him the opportunity to take responsibility for an appeal of the state court’s decision on her behalf, but received no response. In these circumstances, “it is for the finder of fact to apportion the relevant fault” between the parties. Rabbage, 426 P.3d at 775.

Comment: this decision arises in an area of the law that is often disputed. The decision should have been published. A more thorough review of the facts and procedural developments in the underlying case would have also been beneficial.

Edward X. Clinton, Jr.