Herendeen v. Samuel R. Mandelbaum, Esq.
2D15-4300
| Fla. Dist. Ct. App. | Oct 25, 2017Background
- Christopher Hutchins pleaded guilty to manslaughter and was sued for wrongful death; jury awarded a judgment including $500,000 in punitive damages.
- Hutchins retained Mandelbaum to defend the wrongful-death case; defense presented no evidence of Hutchins' inability to pay punitive damages and did not move to direct verdict on punitive damages.
- Hutchins later filed Chapter 7 bankruptcy; the bankruptcy trustee, Christine Herendeen, stepped into Hutchins' claims and the bankruptcy court discharged Hutchins' personal liability on the wrongful-death judgment.
- As trustee, Herendeen sued Mandelbaum for legal malpractice, alleging the lawyers’ failure to defend the punitive damages claim proximately caused the judgment.
- Mandelbaum moved for summary judgment, arguing (1) the bankruptcy discharge eliminated any damage (ninth affirmative defense) and (2) public policy bars recovering punitive damages from a nonparty attorney (eighth affirmative defense).
- The trial court granted summary judgment for Mandelbaum; the district court reversed and remanded, holding the trustee may pursue the malpractice claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a bankruptcy discharge of the underlying judgment bars the trustee from suing the debtor's former attorney for malpractice | Herendeen: the malpractice claim belonged to the bankruptcy estate and the trustee may pursue damages caused to the estate despite the debtor's personal discharge | Mandelbaum: the discharge eliminated debtor's liability so there was no damage to the estate; therefore no malpractice recovery | Court: Reversed — trustee stands in debtor's shoes; discharge eliminates personal liability but not the claim or estate's interest, so the malpractice suit may proceed |
| Whether public policy forbids recovering punitive-damages-type awards from the attorney who allegedly caused them | Herendeen: public policy does not shield attorneys from malpractice liability for failing to defend punitive damages; punitive component can constitute damages proximately caused by counsel | Mandelbaum: public policy prohibits shifting punitive damages to a nonparty/attorney; punitive damages punish the wrongdoer and should not be indemnified | Court: Rejected defense — public policy does not categorically bar malpractice recovery tied to punitive damages; court left merits (duty, breach, proximate causation) for later |
Key Cases Cited
- Volusia Cty. v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126 (Fla. 2000) (summary-judgment standard; appellate review de novo)
- Stanley v. Trinchard, 500 F.3d 411 (5th Cir. 2007) (trustee can pursue debtor's prepetition causes of action; discharge does not eliminate estate claims)
- Official Comm. of Unsecured Creditors of PSA, Inc. v. Edwards, 437 F.3d 1145 (11th Cir. 2006) (property of the estate under §541 includes prepetition causes of action)
- O'Halloran v. PricewaterhouseCoopers LLP, 969 So. 2d 1039 (Fla. 2d DCA 2007) (bankruptcy trustee stands in debtor's shoes to pursue estate claims)
- Camp v. St. Paul Fire & Marine Ins. Co., 616 So. 2d 12 (Fla. 1993) (bankruptcy discharge eliminates personal liability but does not necessarily extinguish the underlying debt for all purposes)
- Ging v. American Liberty Ins. Co., 423 F.2d 115 (5th Cir. 1970) (insurer’s duty to defend and bad-faith handling of defense can create triable issues; not directly binding for malpractice/punitive-damages shift)
- Lohr v. Byrd, 522 So. 2d 845 (Fla. 1988) (Florida refused to allow punitive award to be taken from deceased tortfeasor’s estate)
- Engle v. Liggett Group, Inc., 945 So. 2d 1246 (Fla. 2006) (punitive damages are punitive and deterrent in nature)
- Rinaldi v. Aaron, 314 So. 2d 762 (Fla. 1975) (evidence of defendant’s financial worth is admissible when determining punitive damages)
- Hunt v. Dresie, 740 P.2d 1046 (Kan. 1987) (attorney malpractice liability may encompass punitive damages assessed in underlying case when counsel’s negligence caused the judgment)
- Scognamillo v. Olsen, 795 P.2d 1357 (Colo. App. 1990) (punitive damages in prior case can be part of malpractice damages if proximately caused by counsel’s negligence)
- Picadilly, Inc. v. Raikos, 555 N.E.2d 167 (Ind. Ct. App. 1990) (discussing malpractice damages tied to prior judgment)
- Paul v. Smith, Gambrell & Russell, 599 S.E.2d 206 (Ga. Ct. App. 2004) (refused to permit shifting punitive-damage liability to former counsel; court here found it out of step with other jurisdictions)
- Crosby v. Jones, 705 So. 2d 1356 (Fla. 1998) (judge-related "judgmental immunity" referenced but not decided)