This is a legal malpractice action brought against two attorneys based on their failure to prevent the sale of stock in closely held family corporations. Plaintiff Mary Ann Jeffries first hired defendant-attorney David Mills to represent her in a bankruptcy matter. Mary Ann’s judgment creditors offered to purchase Mary Ann’s stock from the bankruptcy trustee and presented the proposal to the bankruptcy court for approval. Mills did not attend the hearing on the proposed sale or file objections on Mary Ann’s behalf, and the bankruptcy court ordered the sale. Mary Ann subsequently hired defendant-attorney Aaron Bell to file a motion for relief from that order. That motion was denied. Later, Mary Ann brought this malpractice action against both Mills and Bell. Her mother-in-law, Wilma Jeffries, who also held stock in the family corporations, joined in the action and alleged negligence on the theory that the sale of Mary Ann’s stock diminished the value of her own. The trial court entered summary judgment in favor of both defendants and against both plaintiffs.
Plaintiffs appeal, raising numerous assignments of error that call on us to resolve, inter alia, whether defendants owed a duty to Wilma, who was not their client; whether Mary Ann’s claims against Mills were time-barred; and whether Mary Ann could establish causation with regard to her action against Bell. As we explain below, we hold that one of Mary Ann’s counts against Mills was not time-barred. We therefore reverse entry of summary judgment as to that count. We dismiss Wilma’s appeal of summary judgment entered in favor of Bell for lack of jurisdiction. In all other respects, we affirm.
I. THE SUMMARY JUDGMENT RECORD
Because this case was resolved on a motion for summary judgment, we follow the familiar standard of review set out in
Jones v. General Motors Corp.,
The dispute over plaintiffs’ affidavits arose when, in response to Mills’s motion for summary judgment, plaintiffs submitted affidavits from Mary Ann and her husband,
Both Mary Ann’s and Michael’s affidavits consist of a series of one-sentence averments that merely incorporate specified paragraphs of the factual summary in plaintiffs’ memorandum in opposition to summary judgment. That summary is 16 pages in length. It consists of numbered paragraphs containing statements that frequently blend factual allegations with legal conclusions. In incorporating paragraphs of the factual summary, often several at a time, the affiants purport not to adopt the “legal conclusions” in the summary, but they do not identify the particular statements they consider to be the disavowed “legal conclusions.” Likewise, in incorporating and adopting statements of fact from the summary, purportedly based on each affiant’s personal knowledge, the affidavits do not identify the incorporated statements. 1
The form and substance of the affidavits present other problems as well. Because of their novel structure, the affidavits provide scant basis for understanding whether or how the affiants had personal knowledge or are competent to testify regarding several of the factual allegations. 2 See ORCP 47 D (affiant must “show affirmatively” that he or she is “competent to testify to the matters stated therein”). Also, it is not obvious that all of the facts incorporated into the affidavits constitute admissible evidence. At a minimum, the process by which plaintiffs chose to place information into the summary judgment record did not allow for Mills to test, and for the court to determine, that the affidavits do. All in all, the form and substance of plaintiffs’ affidavits made it impossible for either the trial court or Mills to glean the relevant averments from the 16-page summary and to determine if they complied with the requirements of ORCP 47 D. 3 We therefore hold that the affidavits did not comply sufficiently with the rule and should be disregarded along with the factual summary that they purport to incorporate. 4
There remains, however, plaintiffs’ challenge to the trial court’s denial of their motion for leave to file supplemental affidavits, a matter for the trial court’s discretion.
See
ORCP 47 D (trial court “may permit affidavits to be supplemented or opposed by depositions or further affidavits”). Mills urges that the trial court properly refused the supplemental affidavits because they were not “supplemental” at all but instead were a belated effort to shore up the deficiencies in plaintiffs’ earlier affidavits. The trial court might well have been on solid ground had it denied the motion on that basis, assuming that plaintiffs previously had a reasonable opportunity to prepare and submit materials in response to the motion for summary judgment.
The settled rule is that, on a motion for summary judgment, affidavits may raise issues that go beyond the pleadings if an amendment of a pleading to raise those issues would be warranted.
See, e.g., U.S. National Bank v. Miller,
We cannot say that the trial court abused its discretion on this record. As the trial comí recognized, plaintiffs’ entitlement to file supplemental affidavits raising new issues depended on whether an amendment to their complaint was warranted. Plaintiffs declined the opportunity to demonstrate that they would be entitled to amend their complaint at that stage of the proceedings. Plaintiffs therefore are in no position to complain about the trial court’s ruling.
II. WILMA’S CLAIMS
Wilma joined in this action alleging that her stock in the family corporations lost value because of the bankruptcy sale of Mary Ann’s stock and that both attorneys reasonably could have foreseen that harm. In moving for summary judgment, defendants argued that they did not at any time act as Wilma’s attorney and therefore did not owe her a duty of care. The trial comí agreed, and Wilma challenges the trial court’s ruling.
A. Wilma’s claims against Bell
As a threshold matter, Bell argues that we do not have jurisdiction to consider Wilma’s appeal of the trial court’s entiy of summary judgment in his favor because Wilma failed to name him as an adverse party in her original notice of appeal. Bell was, however, served with the notice of appeal and was named as a party to the action generally. The question presented by Bell’s challenge, therefore, is whether the failure to designate him as adverse was jurisdictional.
On June 30, 1997, the trial court entered summary judgment on Wilma’s claims against both Mills and Bell. Judgment had not yet been entered on Mary Ann’s claims. At
Wilma’s request, summary judgment on her claims was entered pursuant to ORCP 67 B so that Wilma could pursue a separate appeal in the matter. Although the judgment determined only Wilma’s claims, a notice of appeal was filed listing both WUma and Mary Ann as the appellants. Only Mills, however, was listed as a respondent. Bell was named but was not identified as a respondent. Specifically, the caption listed Mills and Bell separately, identifying Mills as “Defendant-Respondent” and Bell as “Defendant.”
Thus, the notice of appeal neither designated Bell as a party to the appeal (as opposed to a party to the action generally) nor as a respondent — i.e., an adverse party. Yet, at every possible point, the notice of appeal did so designate Mills. Bell was not treated as a party to the appeal by our court, was not served with confirmation from our court that the appeal had been filed, and was not provided notice of any fifing deadlines in the appeal. Approximately two months after entry of Wilma’s ORCP 67 B judgment, the trial court entered summary judgment against Mary Ann on all claims against Bell and Mills. Rather than file a separate notice of appeal as to Mary Ann, plaintiffs filed an amended notice of appeal that named both Mills and Bell, in the caption and throughout the body of the notice, as respondents to the appeal.
In analyzing the jurisdictional issue that Bell raises, the starting point is ORS 19.270. That statute sets forth requirements for appellate court jurisdiction as follows:
“(1) The Supreme Court or the Court of Appeals has jurisdiction of the cause when the notice of appeal has been served and filed as provided in ORS 19.240, 19.250 and 19.255. * * *
sji 5f; iji
“(2) The following requirements of ORS 19.240,19.250 and 19.255 are jurisdictional and may not be waived or extended:
“(a) Service of the notice of appeal on all parties identified in the notice of appeal as adverse parties or, if the notice of appeal does not identify adverse parties, on all parties who have appeared in the action, suit or proceeding, as provided in ORS 19.240(2)(a), within time limits prescribed by ORS 19.255.
“(b) Filing of the original of the notice of appeal with the Court of Appeals as provided in ORS 19.240(3), within the time limits prescribed by ORS 19.255.
“(3) After the Supreme Court or the Court of Appeals has acquired jurisdiction of the cause, the omission of a party to perform any of the acts required in connection with an appeal, or to perform such acts within the time required, shall be cause for dismissal of the appeal. In the event of such omission, the court, on motion of a party or on its own motion may dismiss the appeal.”
(Emphasis added.)
ORS 19.270(2) is not an all-inclusive list of appellate court jurisdictional requirements. As the Supreme Court has held, the statute was intended by the legislature to clarify “the rules regarding which
service
and
filing
requirements are jurisdictional.”
6
Zacker v. North Tillamook County Hospital Dist.,
In
Stahl v. Krasowski,
The touchstones of appellate jurisdiction are minimally adequate notice and timeliness in the filing of the notice of appeal. Consequently, we have declined to hold that content defects in a notice of appeal are jurisdictional when the nature of the defect is such that the party received adequate notice. For the notice to be “minimally adequate,” it must contain enough information reasonably to apprise the adverse parties that an appeal is being taken from an appeal-able judgment.
Smith and Koors,
Applying that test to the notice of appeal here, we hold that, under these particular circumstances, the failure to designate Bell as an adverse party in the original notice of appeal is jurisdictional. Here, the original notice of appeal went to pains to identify Mills throughout as a “respondent” while designating Bell as only a “defendant.”
See
ORAP
2.05(1) (caption of notice of appeal shall name all parties completely using their designations in the trial court
(e.g.,
plaintiff, defendant) and
designating the parties to the appeal, as appropriate (e.g.,
appellant, respondent)). Bell reasonably could conclude from the designations that he was not a party to the appeal because Wilma would be challenging only the summary judgment as to the claims against Mills, not summary judgment in Bell’s favor. The defect is not meaningfully distinguishable from the failure to designate the proper judgment from which the appeal is taken.
Cf. Stahl,
Bell was not added as a respondent to the notice of appeal until plaintiffs filed an amended notice of appeal some two months after entry of judgment on Wilma’s claim against him. Because Bell was entitled to the concurrence of both
adequate
and
timely
notice, the amended notice, which was filed more than 30 days after entry of the judgment being appealed, could not cure the jurisdictional defect.
See Bourgeois v. Grenfell,
Accordingly, we dismiss Wilma Jeffries’s appeal as to the judgment entered in favor of defendant Bell.
No similar defect is involved in Wilma’s appeal of the summary judgment entered against her on her claims against Mills. Consequently, as to those claims, we must decide whether Mills owed Wilma a duty of care to protect her from economic losses.
An attorney is liable for a third-party’s economic losses resulting from actions taken within the scope of an attorney-client relationship with another only if the third party first demonstrates the
“existence
of a special relationship in which the defendant had some obligation to pursue the plaintiffs economic interests.”
Roberts v. Fearey,
III. MARYANN’S CLAIMS
We turn to Mary Ann’s claims. Mary Ann alleged two counts of malpractice against Mills. The first count related to Mills’s allegedly negligent representation of Mary Ann before the hearing and his failure to prevent the bankruptcy court from ordering the stock sale. In the second count, Mary Ann alleged malpractice based on Mills’s later failure to appeal or to move for reconsideration of the order. The trial court ruled that Mary Ann’s cause of action on her first count is time-barred because the original complaint was not filed within the statute of limitations. As to the second count, which plaintiff added to the original complaint by amendment, the trial court ruled that it was time-barred because it did not relate back to the filing of the original complaint. Mary Ann assigns error to both rulings. Mary Ann also assigns error to the trial court’s entry of summaiy judgment in favor of Bell. We discuss the claims against each attorney in turn.
A. Mary Ann’s claims against Mills
1. Count One: Representation before the bankruptcy court’s ruling
The bankruptcy court approved the stock sale on June 29, 1993, following a hearing. Mary Ann filed her malpractice complaint against Mills exactly two years later, on June 29, 1995. In her complaint, she alleged, among other things, that Mills failed to make reasonable efforts to dismiss the involuntary bankruptcy and failed to prevent the bankruptcy court from ordering the stock sale. If Mary Ann’s cause of action accrued on or after June 29,1993, then it was filed within the two-year statute of hmitations for legal malpractice.
See
ORS 12.110(1);
U.S. Nat’l Bank v. Davies,
A cause of action for legal malpractice must be brought within two years of the date on which the action for the “injury” accrues.
Id.
The cause of action accrues when the plaintiff suffers a legally cognizable harm and knew or should have known that the damage was caused by the lawyer’s acts or omissions.
See Stevens v. Bispham,
Nor are any of the discrete specifications of negligence in Mary Ann’s complaint time-barred. Mills points in particular to Mary Ann’s allegation that Mills was negligent because he failed to succeed in obtaining a dismissal of the bankruptcy action in 1992. An individual specification of negligence or other tortious conduct, although set forth as part of a single cause of action, may be barred by the applicable statute of limitations if it alleges a harm that would be separately actionable.
See generally Davis v.
Bostick,
Mills also asserts that he is entitled to summary judgment because, as to count one of her complaint, Mary Ann cannot establish any of the elements of legal malpractice. The trial court did not reach Mills’s contentions in that regard because the court concluded that Mary Ann’s first count of negligence was time-barred. Mills renews those arguments on appeal.
See Capital Investments v. Lofgren,
First, Mills challenges the adequacy of Mary Ann’s allegations of negligence to establish one or more of the elements of duty, breach, or causation. Mills addresses, however, only seven of the eight allegations; he does not assert a deficiency in the allegation that he was negligent in faffing to obtain a dismissal of Mary Ann’s involuntary bankruptcy proceeding on the basis that it was improperly filed. Because Mills does not controvert that allegation or argue its legal insufficiency, he is not entitled to summary judgment on Mary Ann’s first count of negligence.
See Kutbi v. Thunderlion Enterprises,
Mills also argues that, as a matter of law, Mary Ann did not suffer any damages. Mills proffered evidence demonstrating that,
To prevail on that point, Mills would have had to produce the type of evidence that would conclusively demonstrate that Mary Ann did not suffer any harm as a result of the loss of her stock.
See Preble v. Schwabe, Williamson & Wyatt,
To conclude that Mary Ann did not suffer any damages, we would have to be willing to infer that stock in a corporation with no assets has no value whatsoever to anyone. That inference perhaps is a permissible one, but we do not agree that it is a legally necessary one. Whether to draw that inference in a particular case, with reference to stock in a particular corporation, should be left to a jury. Viewing the record in the light most favorable to Mary Ann, we cannot conclude that the record on summary judgment conclusively establishes that Mary Ann did not incur any damages. The trial court erred in entering summary judgment on count one.
2. Count Two: Representation after the bankruptcy court’s ruling
The next issue is whether the trial court correctly concluded that Mary Ann’s second count of negligence was time-barred. Mary Ann added count two in her amended complaint, filed on August 28, 1996. In that count, she alleged negligence based on assertions that Mills failed to appeal, to file a motion for reconsideration, and to advise her to seek other counsel. All of the acts and omissions alleged in that count occurred between June 29,1993, and December of that same year, when Mills ceased representing Mary Ann. 11 The trial court ruled that the second count did not relate back to the date of the filing of the original complaint because it involved “discrete and new matters of negligence.” The court therefore determined that the count was time-barred. We agree.
ORCP 23 C provides:
“Whenever the claim or defense asserted in the amended pleading arose out of the conduct, transaction, or occurrence set forth or attempted to be set forth in the original pleading, the amendment relates back to the date of the original pleading.”
The rule’s concern is one of notice.
Welch v. Bancorp Management Services,
Here, the first count alleged conduct that occurred before and on the date of the bankruptcy hearing and that related to Mills’s representation of Mary Ann in the course of the bankruptcy proceedings. According to Mary Ann’s complaint, after the bankruptcy court entered its order, she negotiated with Mills to continue to represent her and achieve a dismissal of the bankruptcy action through a possible appeal or reconsideration of the bankruptcy court’s order. 12 The second count is directed to acts and omissions that Mills allegedly took pursuant to that further agreement.
In these particular circumstances, Mary Ann’s second count of negligence does not bear a sufficient relationship to the first. Mills’s representation of Mary Ann in the initial bankruptcy hearing involved judgments and professional choices that were distinct and independent, both in substance and time, from those involved in her attempt to determine how to respond legally to the bankruptcy court’s unfavorable order. Mary Ann’s original complaint put Mills on notice that he was being sued for negligence based on his allegedly inadequate representation in connection with his efforts to prevent the bankruptcy court from ordering the sale of Mary Ann’s stock. That claim did not give Mills any inherent notice of or reason to assume that later acts or omissions concerning appeal and reconsideration would likewise be charged as negligent. The second count therefore does not relate back.
See Caplener,
The next question, then, is whether Mary Ann’s cause of action on the second count accrued more than two years before that date. Mary Ann alleged that all of the acts and omissions in the second count occurred between September 1993 and December 1993. Mary Ann urges us, nevertheless, to adopt May 20,1996, as the accrual date because that is when she allegedly learned that her stock was “irretrievably lost.” That accrual date, would save the second count from being time-barred. Mary Ann did not raise that argument below, however. She argued only that her cause of action on count two accrued on September 16, 1994, which was the date the bankruptcy court denied the motion for relief from its order. She took the position below that, for purposes of the second count, she “knew with certainty that Mills’ts] conduct had caused actual harm” as of that date. On appeal, she abandons her September 16,1994, accrual theory and relies only on the May 20, 1996, date. We decline to consider her new contention, especially when to do so would permit her to admit to the trial court that she knew she was harmed as of September 16,1994, and then inconsistently argue on appeal that she did not know that she was harmed until almost two years later. Mary Ann does not present any other argument upon which we could reverse the trial court’s ruling. We therefore hold that the trial court did not err in determining that the second count was time-barred, and we affirm as to that count.
B. Mary Ann’s claim against Bell
Mary Ann also assigns error to the trial court’s entry of summary judgment in favor
To show causation in a legal malpractice action, a plaintiff must demonstrate that she would have obtained a more favorable result in the earlier action if the attorney had not been negligent.
Chocktoot v. Smith,
Mary Ann nevertheless asserts that a factual issue was presented in this case. In support of that position, she argues on appeal, as she did below, that “if the bankruptcy court had reached the [motion for relief] on the merits, then that court could not have arrived at any decision until both the true value of the stock and the true amount of the purchase price paid * * * had been determined upon evidence.” Similarly, she points us to other alleged factual disputes that, she asserts, a jury would have to decide to determine whether the bankruptcy court would have ruled in her favor if “Bell had timely filed the motion and been allowed to present all available evidence on the merits at a hearing.”
The problem with Mary Ann’s argument is that it does not address the criteria for granting relief from the bankruptcy order. Her argument assumes that merely filing a motion for relief — any motion for relief — within one year would ensure reconsideration of whether the bankruptcy court should have ordered the sale of the stock. That assumption is wrong. A motion for relief, even if timely filed, must provide some extraordinary basis for granting relief from the order. Merely asserting that there is a factual basis to conclude that the order is erroneous is not enough. Under the relevant federal rule, proper grounds include: mistake, inadvertence, surprise, or excusable neglect; newly discovered evidence; fraud or misrepresentation on the opposing party’s part; or other reason justifying relief from operation of the judgment. FRCP 60(b). 13
Plaintiff Wilma Jeffries’s appeal as to defendant Aaron Bell dismissed; summary judgment on count one of Mary Ann Jeffries’s claim against defendant David Mills reversed; otherwise affirmed.
Notes
For example, at one point Mary Ann’s affidavit incorporates “[paragraphs 12,13 and 14, except for the legal conclusions therein.”
For example, one paragraph of the factual summary incorporated into Mary Ann’s affidavit consists largely of legal and factual assertions about Mills’s knowledge and awareness of certain facts regarding the bankruptcy proceeding.
Compare McDonough v. Jones,
We express no opinion as to whether, under other circumstances, an affidavit can satisfy ORCP 47 D if, instead of setting forth affirmative factual statements, it incorporates portions of other materials, such as the memorandum in support of or in opposition to the motion. It is enough to observe that, here, the affidavits were so defective in form that they could not meaningfully be tested against the requirements of the rule.
Specifically, the court ruled that plaintiffs should request leave to file a second amended complaint, which would provide a basis for filing the affidavits “in some connection with that, with new allegations.” Plaintiffs’ counsel then asked for a time frame for filing an amended complaint and asked whether the trial court was giving plaintiffs leave to amend their complaint. The trial court reiterated that plaintiffs first should determine if they wanted to amend their complaint and, if so, in what way. The trial court was inviting counsel then to move for leave to amend the complaint and to provide the court with “statutory reasons and grounds to do so.” Then, if plaintiffs had filed that motion together with a proposed amended complaint, the trial court would have what it needed to consider whether an amendment was warranted and whether the supplemental affidavits should be allowed.
ORS 19.250 and ORS 19.270 were renumbered in 1997 from ORS 19.029 and ORS 19.033, respectively. Several of the cases we cite in our discussion refer to the former numbers. To avoid confusion, we refer only to the renumbered versions of the statutes in our discussion of those cases.
We emphasize that the notice problem exists in this case because of the specific designation of Mills as a party respondent, and no similar designation of Bell as adverse. ORS 19.270(2) provides that, when the notice of appeal does not designate any of the parties as adverse, then all parties must be timely served. In effect, in the absence of a special designation of adversity, all of the parties are deemed to be adverse.
Street v. Gibson, 60 Or
App 768,771,
The trial court seems correctly to have determined the accrual date to be the date that the bankruptcy court ordered the sale of the stock. The trial court concluded that the cause of action was time-barred apparently because it mistakenly believed that the original complaint was filed on July 5,1995. That was incorrect. All parties agree that the original complaint was filed on June 29,1995.
Mills does not argue that he is entitled to partial summary judgment with respect to any of the portions of count one.
See Stevens v. Horton,
Mary Ann alleges that Mills ceased representing her in December 1993. Mills did not officially withdraw as counsel until March 2,1994. The order authorizing that withdrawal, however, was not part of the record on Mills’s motion.
Mary Ann alleged that “Mills verbally promised * * * that if she would continue to allow him to represent her and would continue to pay for his services as her attorney, that he would accomplish restoring her stock ownership * * * and promptly obtain dismissal of the involuntary Chapter 7 bankruptcy.” Those allegations were made in a separate breach of contract claim, which Mary Ann later voluntarily dismissed. Although Mary Ann is not necessarily bound by the admissions in the dismissed claim, they are evidence of the fact admitted.
See Yates v. Large,
With some exceptions that are inapplicable here, FRCP 60(b) applies to bankruptcy proceedings. FRBP 9024. That rule provides, in part:
“On motion and upon such terms as are just, the court may relieve a party or a party’s legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud * * *, misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order, or proceeding was entered or taken.”