A state supreme court has held that where an attorney urged his client’s wife to plead guilty to traffic citations, a jury could find that conflicted advice was a proximate cause of her demotion and suspension. In so holding, the court applied the “substantial factor” test for proximate cause and held that if the plaintiff had been properly advised, she would have been “deterred” from entering the guilty plea. ABA Litigation Section leaders say this case highlights the importance of understanding who the client is.
In Gilbert v. Stewart, the plaintiff’s ex-husband kept the family car, although it was still titled in the plaintiff’s name. The ex-husband incurred several traffic tickets, which were mailed to the plaintiff’s home, but “she never learned of them because [the ex-husband] removed all mail related to the traffic tickets from her mailbox.” The plaintiff, an employee at the local probation office, was summoned to the New Jersey municipal court.
After the initial hearing was adjourned, the ex-husband’s attorney “indicated to plaintiff that the optimal resolution would be for her to plead guilty to the charges because [the ex-husband] was at greater risk of license suspension due to his poor driving record.” The attorney did not enter into a retainer agreement with the plaintiff, and it is “undisputed that [the attorney] failed to advise plaintiff of the impact that a guilty plea might have on her public employment.”
At the next hearing, the attorney “entered an appearance on behalf of both plaintiff and [the ex-husband].” After the plaintiff entered a guilty plea, the judge imposed fines and community service against the plaintiff and dismissed all charges against the ex-husband. Two months later, the plaintiff retained different counsel and challenged her conviction; ultimately, “the disposition against her was vacated, and her fines were repaid to her.”
In the meantime, however, the plaintiff’s employer opened an investigation, revealing that the plaintiff was also a defendant in another matter, and that her driver’s license was previously suspended. The plaintiff ultimately entered into a settlement agreement with her employer, which included a suspension without pay and a demotion.
The plaintiff sued the attorney for legal malpractice in the New Jersey Superior Court, Law Division. The attorney moved for summary judgment, arguing that his conduct did not proximately cause the plaintiff’s harm. The trial court agreed, observing that “the only evidence in this case about why the demotion took place along with its resulting deficiencies . . . is that [plaintiff’s] employer . . . says that it was her lack of candor in reporting the charge and it had nothing to do with the fact that she pled guilty to it.” The plaintiff appealed to the New Jersey Superior Court, Appellate Division, which affirmed.
On appeal, the Supreme Court of New Jersey applied the “substantial factor” test, which is “well-suited for legal malpractice cases in which inadequate or inaccurate legal advice is alleged to be a concurrent cause of harm.” Under this test, “[a]ctions taken by the client in reliance on the attorney’s counsel will not be found to sever the causal connection between the breach and the harm suffered[.]”
The court held that “a jury could reasonably conclude that defendant’s legal advice was a substantial factor in [the plaintiff’s] demotion and suspension[.]” Specifically, the attorney “should have known that there would be employment consequences for a Judiciary employee who enters a guilty plea, even if he was unaware what other infractions plaintiff had.” Thus, “had plaintiff been properly advised by counsel, she would have been deterred from the undertaking of the guilty plea and, by logical extension, its consequences—the subsequent investigation, suspension, and demotion.” The court reversed the grant of summary judgment and remanded to the trial court for further proceedings.
According to Litigation Section leaders, this case highlights an important question over who the client is. For instance, “if [the plaintiff] was not a client, then [the attorney] had no business providing legal advice to [the plaintiff] and recommending that she plead guilty,” states Neil J. Wertlieb, Pacific Palisades, CA, member of the Attorneys’ Liability Subcommittee of the Section’s Professional Liability Committee. “On the other hand, if [the plaintiff] was his client, then [the attorney] had certain obligations that apparently were not satisfied here.”
“To me the most outrageous thing is the way he made her his client, and in a situation where (a) he failed to get any kind of retainer agreement, and (b) he had a conflict,” comments Ronald C. Minkoff, New York, NY, immediate past cochair of the Attorneys’ Liability Subcommittee. According to Minkoff, this was unnecessary because “the lawyer failed to slow down the process.” In other words, “instead of slowing it down, making sure the wife understood what his role was, and making sure he thought through whether there was a conflict, he moved ahead rapidly in a case that seemed small,” Minkoff explains.
Minkoff also found interesting the court’s application of the causation standard. “Instead of relying on proximate cause ‘but for’ causation,” notes Minkoff, “the New Jersey Supreme Court used the looser ‘substantial factor’ test, and that, as Robert Frost said, ‘made all the difference.’” “Most jurisdictions use the ‘but for’ standard, which would mean this would need to be the sole cause of harm,” he observes.
In any event, Wertlieb sees another, hidden issue. “I find it curious that there appeared to be no criticism of the attorney for recommending that [the plaintiff]—a clearly innocent person with respect to the charges—plead guilty to such charges so as to minimize the consequences to her former husband,” opines Wertlieb. “In so doing, [the attorney] was in effect suggesting that [the plaintiff] mislead the tribunal so as to cover up the misconduct of her former husband,” he concludes.
