HAGER v. LAW OFFICES OF HILYER, 52577-8-I (Wash.App. 9-7-2004)

No. 52577-8-IThe Court of Appeals of Washington, Division One.
Filed: September 7, 2004 UNPUBLISHED OPINION

Appeal from Superior Court of King County. Docket No: 01-2-15605-5. Judgment or order under review. Date filed: 06/10/2003. Judge signing: Hon. Thomas John Majhan.

Counsel for Appellant(s), Richard L. Butler, Cook, Berst, Landeen
Butler, 407 Agc Building, 1200 Westlake Ave N, Seattle, WA 98109-3543.

Counsel for Respondent(s), Thomas V. Harris, Perey Harris Law Firm, 2025 1st Ave Ste 250, Seattle, WA 98121-2147.

Peter B Klipstein, Merrick Hofstedt Lindsey, 710 9th Ave, Seattle, WA 98104-2099.

BAKER, J.

Dr. Kennon Hager sued his former attorney Bruce Hilyer, alleging malpractice and breach of fiduciary duty. Hilyer counterclaimed for unpaid fees. The trial court dismissed Hager’s claim and later granted Hilyer’s summary judgment motion on the countersuit for unpaid fees. We conclude that Hager failed to put forth any credible evidence creating a material factual dispute. Accordingly, we affirm the trial court.

I
Bruce Hilyer represented Dr. Kennon Hager in a series of lawsuits stemming from his termination by a West Virginia hospital. In 1994, Hilyer brought suit in Federal District Court for the Southern District of West Virginia. The suit proved difficult and expensive.[1]

Hilyer billed Hager on an hourly basis for handling the case. His fee was $175 per hour. From the outset of the litigation, Hilyer maintained a separate trust account for Hager’s funds. Hager periodically replenished the account. Hilyer paid litigation costs and attorney fees from the trust account as they came due. Because of extensive discovery, Hilyer billed more hours than he had initially estimated would be necessary. By 1996, Hager was unable to keep funds in the trust account to pay costs and fees. In March 1996, Hager and Hilyer agreed to modify the terms of the representation. The new agreement reduced the hourly rate by 40 percent. In exchange, Hager agreed to pay Hilyer a reduced contingent fee of 14 or 16 percent of any net recovery, depending on the timing of the recovery. Although the agreement was signed in March, the reduced fee provision was retroactive to January 1, 1996.

The agreement also provided that either party could terminate the attorney/client relationship. In that event, Hager would owe the entire amount of hourly legal fees, without the benefit of the discount. The contingent fee would also terminate. Hilyer advised Hager to seek independent counsel before signing the agreement, but Hager chose not to seek outside advice.

During the summer of 1996 and again during the spring of 1997, Hager was unable to replenish the trust account fully for litigation costs and fees. Throughout that period, Hager had a rolling `past due’ balance ranging between $71,233.22 in July and $138,138.98 in November.

In September 1996 the litigants negotiated a settlement agreement whereby the hospital agreed to pay Hager $800,000 and provide a reference letter for Hager. That same month, Hager wrote to Hilyer objecting to using the trust account to disburse the settlement proceeds. He proposed that he should receive the full settlement amount and then pay the outstanding fees and costs directly.

Hilyer rejected that proposal. He explained that the established practice of using the trust account to process funds was the proper procedure: [A]ttorney trust accounts are regulated by the Bar Association and subject to audit. In the event that there is ever a question in the future about the appropriate disbursement of funds, everyone involved is better protected if the money is distributed through an attorney trust account rather than through another account.

In the letter, Hilyer also assured Hager that after receiving the settlement check and endorsing it to the trust account, Hilyer would provide an accounting to Hager for his approval:

I will then provide a statement of disbursements for your approval, to include all outstanding third party invoices for experts, court reporters and other case expenses, and for payment of your outstanding legal fees in accordance with our agreement. After you sign off on my proposed disbursements, and the check has cleared the drawer’s bank, I will make payments from the trust account to third parties, to my law firm, and the balance to you.

The litigants could not formalize the September settlement agreement because Hager refused to execute releases of the defendants for other potential claims. Hager directed Hilyer to file a motion to enforce the settlement based on the parties’ verbal colloquy with the court outlining the terms of the settlement. The court denied this motion and reset the matter for an April 1997 trial date.

In March, the court granted a defense motion restricting Hager’s potential recovery on his contractual claims. Three days later, Hager agreed to perform pursuant to the September settlement agreement. He agreed to execute the releases, confirmed the settlement agreement on the record before the trial court, and acknowledged that he had signed the agreement. The next day, Hager endorsed the settlement check and Hilyer deposited it into the Hager trust account. That day, Hilyer disbursed $600,000 to Hager, and $97,705 to himself for past due costs and fees. This was the same amount as reflected on his March 15, 1997 bill.

Shortly after these two initial disbursements, Hager sent a handwritten note to Hilyer objecting to a portion of the March 15 bill. Hager explained that `there are some facets of this (double billing of [attorney Meals’] bill, interest, some costs which were to be invoiced to BRMC but I understood not if I paid, etc.) I object to but have not had time to pursue.’ Hilyer credited the trust account for the double billing of attorney Meals’ time.

In May, Hilyer disbursed an additional $56,020.21 to Hager. He also sent a letter explaining that he had paid the March 15 bill out of the trust account `to bring current an overdue balance that had accumulated over several months.’ Hilyer also explained that Hager had not questioned any portion of the bills until after the April 2 disbursement.

Because of Hager’s continued objections, several items were not paid. These items included Hilyer’s legal fees from his May 7, 1997 bill,[2]
Hilyer’s partial contingent fee,[3] and copying expenses.[4]
Eventually, Hilyer attempted to submit the dispute to the Washington State Bar for fee arbitration, but Hager rejected this proposal.

Four years after settling the suit, Hager sued Hilyer. In his first amended complaint, Hager alleged two causes of action: that Hilyer was negligent in his representation of Hager, and that Hilyer’s conduct `may be in violation of RCW 19.86.020, et. seq.’ Hilyer counterclaimed for unpaid legal fees and costs. In his second amended complaint, Hager added another claim alleging that Hilyer violated the Rules of Professional Conduct (RPC) by removing funds from the trust account without being able to document that the amounts were undisputed. Later, Hager attempted to add yet another claim, alleging that Hilyer breached his fiduciary duty under RPC 1.5 by charging an unreasonable fee. The court denied Hager’s request to add this claim.

Hilyer brought a motion for summary judgment to dismiss all Hager’s claims and for judgment on his counterclaim for unpaid fees and costs. Following briefing and argument, the trial court dismissed all Hager’s claims except for breach of fiduciary duty. The court limited that claim to Hilyer’s $97,705 withdrawal from the trust account on April 2, 1997. The trial court also temporarily struck Hilyer’s motion for summary judgment on his counterclaim for fees and costs.

Hilyer filed another summary judgment motion dismissing Hager’s breach of fiduciary claim and a second motion for summary judgment on his counterclaim for unpaid costs and fees. The court granted both motions. Hager later brought a motion for reconsideration, which the court denied.

II
Hager first argues that Hilyer violated the RPCs and breached his fiduciary duty by withdrawing money from the trust account. Whether an attorney’s conduct violates the relevant RPCs is a question of law.[5]
When a trial court is presented with a question of law, the court may properly disregard expert affidavits that contain conclusions of law.[6]

Hager alleges that Hilyer breached his fiduciary duty by violating RPC 1.14, which requires that attorneys deposit all client funds into trust accounts. RPC 1.14 also prohibits attorneys from taking funds to pay disputed legal fees:

Funds belonging in part to a client and in part presently or potentially to the lawyer or law firm must be deposited therein, but the portion belonging to the lawyer or law firm may be withdrawn when due unless the right of the lawyer or law firm to receive it is disputed by the client, in which event the disputed portion shall not be withdrawn until the dispute is finally resolved.[7]

In a letter to Hilyer sent after the April 2 disbursement, Hager explained that he objected to certain charges, but had not had time to pursue the objections. There is no evidence that he communicated any objection to the fee statements sent prior to the April 2 disbursment.

Hager points to deposition testimony by Karen Boxx opining that as a result of the September communications, Hager reasonably expected that Hilyer would not use settlement funds to pay outstanding legal fees or costs without his specific consent, even if the fees and costs were not disputed. We disagree with this conclusion. Hager objected generally to the concept of a trust account, but that did not prohibit Hilyer from disbursing funds to either Hager (as Hilyer did on April 2) or to Hilyer for unchallenged past due attorney fees.

Hager’s expert acknowledged that although Hager had general objections to the use of the trust account, he did not have any specific objections to Hilyer’s bills before the April 2 disbursement:

I think it’s a question of, you know, advanced consent and understanding that as this money goes I’m giving you this money to pull it out. Now this money is coming from a third party. He’s saying, I don’t want it to go into the trust account. I want to get it, and then pay the bills myself. He’s told, you can’t do that, which you know, that’s fine, but the money will come in. It’s your money. It’s coming in from this outside source. Then you get to see what’s going to come out, and that’s what will happen.

So he hadn’t when he put the money in previously, he consented to the disbursement. Here his understanding was the money would come in from this outside source, and then he would say, okay, pull it out. So that chance at saying, okay, was not there.

The evidence provided by Hilyer supports concluding that by withdrawing funds to pay past due attorney fees to which no objection had been made, he was following the procedure established during his representation. In a declaration submitted for summary judgment, Hager sets forth a number of alleged objections that he had about the March 15 statement for attorney fees and costs. But none of these items that Hager lists raise a factual dispute sufficient to survive summary judgment. He lists nine items that purportedly preclude summary judgment. Each is without merit. We first note that many of these alleged `fee disagreements’ are actually allegations of malpractice and fall outside the ambit of the challenged fees.[8] Moreover, Hager’s letter to Hilyer sent shortly after the April disbursement contradicts his assertion that these fee disputes existed at the time of the April 2 disbursement.

Hager first claims that Hilyer engaged in unauthorized and inappropriate work on the case. Hilyer correctly responds that this argument is improper because it goes to trial tactics about which Hager is not qualified to testify.

He next claims that Hilyer delayed in seeking to enforce the September 1996 settlement agreement. Hilyer is correct that this is immaterial, because the allegation does not state an actual billing dispute or any resulting damages.

Hagar claims that Hilyer disregarded instructions when he did not oppose a motion sealing filings in the litigation. Again, this goes to trial tactics, and Hager is not qualified to testify to this. Because Hager is questioning the tactics of his attorney, he needs an expert.

Hager asserts that he `objected to tens of thousands of dollars spent on fees for inappropriately performed depositions, unauthorized negotiations, and worthless expert witnesses.’ But this assertion is not enough. Hager does not attempt to specify which depositions he objected to, why, or in what manner they were inappropriate. Nor does he provide expert testimony to establish alleged improprieties.

He claims that he objected to copying expenses totaling $11,000, but this cost item was not paid by the challenged April 2 disbursement. Hagar argues that he objected to Hilyer providing the defendants with original billing records. But this argument fails to state an actual billing dispute. He claims that Hilyer agreed to extend deadlines, and that this increased attorney fees and costs, but again this allegation does not state an actual billing dispute or claim any resulting damage. Finally, Hager alleges that Hilyer ignored his instructions not to allow an associate in Hilyer’s firm to work on any part of the case. This alleged dispute also falls beyond the scope of the $97,705 disbursement to which the court restricted Hager’s breach of fiduciary duty claim.

We conclude that there were no actual fee disputes between Hager and Hilyer at the time of the April 2 disbursement. Accordingly, under the RPCs, Hager fails to establish a breach of fiduciary duty.

Hager alleges that Hilyer committed legal malpractice. Once a plaintiff has established an attorney-client relationship, the elements for legal malpractice are the same as for negligence.[9] Thus, to prove legal malpractice, the plaintiff must show that (1) there was an attorney-client relationship that gave rise to a duty of care owed by the lawyer, (2) by his act or omission, the lawyer breached that duty of care, (3) the breach damaged the client, and (4) the breach was a proximate cause of the client’s damages.[10]

Claims of professional negligence usually involve mixed questions of law and fact.[11] A determination of whether an attorney erred regarding a legal matter is a question of law for the judge.[12]
Similarly, when determining proximate cause requires legal analysis, the judge is in a much better position than a jury to make that determination.[13]

In Walker v. Bangs,[14] the Washington Supreme Court recognized that the practice of law is `a highly technical field beyond the knowledge of the ordinary person.’[15] The court went on to caution that `[b]y its very nature, an action for professional negligence in the preparation and conduct of specific litigation involves matters calling for special skill or knowledge [and are] proper subjects for expert testimony.’[16] The court then acknowledged that while expert testimony is not required in every case, allegations of negligence concerning issues such as trial tactics or procedure do require expert testimony.[17]

Hager alleges malpractice based on two separate incidents. The first is Hilyer’s alleged pressure to settle for $800,000. To establish the malpractice, Hager provided a declaration with facts purporting to show Hilyer’s negligence. He alleges that Hilyer told him that he `had no choice’ but to settle the case, and that if Hager refused, he would be held in contempt of court. He also alleged that Hilyer told him his objections would be noted on the record.

The litigation underlying this alleged negligence involved a number of complex Medicare and RICO claims. Documents from the litigation totaled 50 banker’s boxes. And the alleged negligence went to the heart of the case: whether Hilyer inappropriately pressured Hager to settle the case. Hager argues that the alleged negligence is so clear that an expert is unnecessary. Although a judge has greater knowledge about the practice of law than a layperson, issues concerning specialized areas such as those in this case require an expert’s testimony. We conclude that Hager needed to provide expert testimony establishing the standard of care, and whether Hilyer breached that standard. He did not produce any expert testimony on these issues.

The second allegation of malpractice is based on Hilyer’s purported advice to sue an attorney adverse to Hager in a medical malpractice case. The alleged negligence concerned a false representation claim with another attorney and involved the laws of another jurisdiction (West Virginia). Hager needed to establish that the alleged advice given by Hilyer was incorrect, and so improper as to constitute negligence. For this, Hager also needed an expert to testify. Because he did not, he fails to establish a prima facie case of attorney malpractice.

Hager raises a number of issues in his assignments of error that he fails to address in his opening brief. When an appellant fails to brief and argue an alleged error, we will decline to address the issue.[18]
Hager assigns error to the trial court’s decision prohibiting him from amending his complaint to allege that Hilyer violated RPC 1.5 by charging an unreasonable fee. Although Hager sets forth a factual summary of his attempt to amend his pleadings, he does not provide any argument or analysis explaining the legal standards, or how the court erred by denying his amendment. Accordingly, we decline to review this alleged error. Because this issue is not properly before the court, we need not consider Hager’s allegation that the `terminable at will’ provisions in the fee agreement were unconscionable or constituted a breach of Hilyer’s fiduciary duty.[19]

Hager also assigns error to the court’s summary judgment decision granting Hilyer his disputed fees. But while he raises the issue in his assignment of errors, he provides no argument as to why the court’s decision was incorrect. Because he has failed to brief the issue and provide legal support, we reject his argument.[20]

Hager also alleges that Hilyer violated the Consumer Protection Act[21] (CPA). Hager contends that his CPA claims are based on how Hilyer determined, billed, and collected fees. In his brief, Hager has not explained how Hilyer’s acts were unfair or deceptive. Apparently, he relies on the deposition testimony by Karen Boxx to establish that Hilyer’s billing was unfair or deceptive. But at best, Hager only establishes that he and Hilyer disagreed about certain enumerated costs and disbursements to certain retained experts. Again, because he has not briefed the issue, we decline to address it here.

AFFIRMED.

KENNEDY and BECKER, JJ., concur.