Monday, June 26, 2017

Abuse of discretion to deny motion to amend complaint made after summary judgment motions, where issues were already implicit in the case

LeClair v. LeClair2017 VT 34, ¶¶ 27-35 (May 12, 2017)

DOOLEY, J. Plaintiff appeals from the trial court's grant of summary judgment to defendant in this negligence action. Plaintiff argues that the trial court abused its discretion by denying his motion to amend his complaint to add a new liability theory. We reverse and remand.

The original complaint, filed in August 2014, included a single negligence claim, in which he alleged that defendant owed a duty of reasonable care in the design, condition, and maintenance of his premises to those lawfully on his property; that the frost-covered roof presented an unreasonable risk of harm; and that defendant breached his duty of care by demanding that plaintiff work on the roof when it presented an unreasonable risk.  Defendant pled as affirmative defenses that there was no privity between plaintiff and defendant.

The parties agreed by stipulation to conclude all discovery by November 13, 2015, and to present any legal challenge to liability by motions for summary judgment to be filed on or before December 31, 2015. Defendant filed a motion for summary judgment on January 4, 2016.

Three days after filing his response to defendant's motion for summary judgment, plaintiff filed a motion to amend his complaint to add distinct counts entitled premises liability and negligence/safe workplace. The court denied plaintiff's motion to amend his complaint based on three factors: (1) the claim in the amendment was entirely new and based on different facts; (2) the plaintiff did not show good cause for the delayed timing of the amendment; and (3) the case had been pending for eighteen months, discovery had closed, and defendant had filed a motion for summary judgment.

We have summarized the limit on the trial court's discretion to deny a motion to amend: "When there is no prejudice to the objecting party, and when the proposed amendment is not obviously frivolous nor made as a dilatory maneuver in bad faith, it is an abuse of discretion to deny the motion." Bevins v. King, 143 Vt. 252, 254-55, 465 A.2d 282, 283 (1983). We conclude by this standard that  the trial court abused its discretion by denying plaintiff's motion to amend his complaint.

We recognize that we have previously affirmed a trial court's decision not to allow an amendment to pleadings after the other party has filed for summary judgment. Gauthier v. Keurig, 2015 VT 108, 200 Vt. 125, 129 A.3d 108.. But in Gauthier, the amendment's timing was not dispositive.

The absence of good cause for the delay is not a ground under Bevins to deny the motion to amend. The trial court did not find the proposed amendment to be "obviously frivolous" or "a dilatory maneuver in bad faith." Thus, the question comes down to whether granting the amendment would prejudice defendant.

There was no prejudice. Although the theory that defendant was plaintiff's employer was formally introduced in plaintiff's motion to amend, its genesis lies in defendant's answer, discovery, and motion for summary judgment. By the time the trial court considered the motion to amend, the issue of who was plaintiff's employer, and the effect of that determination, was squarely at issue in the case. It is clear from the summary judgment record that defendant did extensive discovery on the issue so the fact that discovery was closed when the court considered the motion to amend the complaint should not have weighed in favor of denying the motion.

Because plaintiff's claim in the motion to amend was addressed at length in defendant's own summary judgment motion, the court’s ruling on the motion to amend was governed by the policy in Rule 15(b) for claims "tried by express or implied consent of the parties." When a party, such as defendant here, impliedly consents to trial of issues not raised in the pleadings, Rule 15(b) states that "amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time." 

 We hold that when an issue enters a case during the summary judgment phase in part through the party later opposing its consideration, as here, the issue is effectively being tried based on the implied consent of the parties, and thus a contemporaneous motion to amend a pleading to include that issue should be freely granted.

SCOVT NOTE. It has long been settled that it is error to deny a motion to amend on the grounds that  the proposed complaint states a "new cause of action."  Perkins v. Windsor Hosp. Corp., 142 Vt. 305, 313, 455 A.2d 810, 815 (1982) The oft-cited test in Perkins  requires the trial court to consider the propriety of a motion to amend by examining several factors: (1) undue delay; (2) bad faith; (3) futility of amendment; and (4) prejudice to the opposing party. Id. 

Leclair's explicit rejection of “absence of good cause for delay” as a basis to deny amendment means Perkins'  "undue delay" now has a limited no meaning independent of the issues of bad faith and prejudice. See Ferrisburgh Realty Investors v. Schumacher, 2010 VT 6 (proper to deny an amendment that would require a continuance to accommodate additional discovery); Colby v. Umbrella, Inc., 2008 VT 20, ¶ 4, 184 Vt. 1, 955 A.2d 1082 (denial of a motion under Rule 15(a) may be justified based upon a consideration of undue delay, among other factors).

A motion during trial is not necessarily too late. In Bevins v. King,the Court reversed the trial court's denial of a motion to amend an answer made on the day of trial. In Lillicrap v. Martin 156 Vt. 165, 591 A.2d 41(1991) the Court affirmed the trial court’s discretion in allowing an amended answer on the sixth day of trial.

In Gauthier v. Keurig the appellant argued and LeClair’implicitly recognizes "[t]here simply is no rule… that requests to amend must be denied when the opposing party has filed a summary judgment [motion]" Under Rule 15(b) a motion to amend to conform to the evidence may be made “ at any time, even after judgment.” By case law, the right of to amend under Rule 15(a) terminates only when judgment is entered. See Felis v. Downs Rachlin Martin, PLLC, 2015 VT 129, ¶¶ 26-27.

Saturday, June 24, 2017

SCOVT gives full retroactive effect to a new rule in a case pending on appeal when the rule was announced.

Deutsche Bank National Trust Co, v.  Watts, 2017 VT 57 [ 6/23/2017]

DOOLEY, J. Defendant borrowers appeal the trial court’s summary judgment decision in favor of plaintiff lender in this mortgage foreclosure action. They assert that the trial court erred by finding that a dismissal with prejudice under Vermont Rule of Civil Procedure 41(b) is not an adjudication on the merits given preclusive effect in a foreclosure action. Lender argues in response that decisions of this Court that gave preclusive effect to the dismissal of foreclosure actions, made only after the trial court’s decision, should be applied only prospectively and not to this case. We reverse and dismiss lender’s action.

In Deutsche Bank v. Pinette, 2016 VT 71, 149 A.3d 479, this Court held that in mortgage foreclosure actions, the effect of an involuntary dismissal for failure to prosecute operates as an adjudication on the merits, barring a mortgagee’s subsequent foreclosure claims based on the same default. Id. ¶ 8. In Cenlar FSB v. Malenfant, 2016 VT 93, 151 A.3d 778 we held that foreclosing entities must give borrowers notice and an opportunity to reinstate loans prior to pursuing subsequent foreclosure actions based on new defaults. Malenfant, 2016 VT 93, ¶¶ 39-40. 

Lender asks us to rule under three-factor test laid out in Chevron Oil Co. v. Huson, 404 U.S. 97 (1971), that lender’s 2013 action was not precluded under the Pinette and Malenfant holdings because the underlying facts here transpired before we announced the holdings in those cases. But the Supreme Court limited the scope of the Chevron Oil test in Harper v. Virginia Department of Taxation, 509 U.S. 86 (1993). The Court requires that a new rule of federal law be given full retroactive in all civil cases “still open on direct review and as to all events, regardless of whether such events predate or postdate our announcement of the rule.” Id. at 97.

For a number of reasons, we decide to adopt the Harper rule. Because this case was on direct review when Pinette and Malenfant were decided, the rule of those cases applies. This action is barred by claim preclusion under Pinette and Malenfant because the foreclosure that lender seeks is based on the same default as the earlier action.

The court’s summary judgment decision is reversed and the matter is remanded for dismissal of plaintiff’s February 2013 complaint.

Thursday, June 22, 2017

Plaintiff in premises liability case had sufficient evidence that defendant had a duty, despite the obvious danger, not to order plaintiff roofer to go onto a frosted roof.

LeClair v. LeClair2017 VT 34 (May 12, 2017)

DOOLEY, J.. Plaintiff appeals from the trial court's grant of summary judgment to defendant, plaintiff's grandfather, in this negligence action. Plaintiff argues that the trial court erred by concluding that defendant owed him no duty. We reverse and remand.

Plaintiff fell from a second-story roof and landed on the paved driveway below, sustaining serious and permanent head and spinal injuries while working to help replace the roof on the building in which defendant has his office. Plaintiff claims that he initially decided not to work on the roof because the frost made it slippery but changed his mind when defendant arrived at the property and ordered him to begin work. Plaintiff contends that the facts alleged in the complaint and that emerged through discovery presented a jury question as to whether defendant breached his duty to exercise reasonable care in demanding that plaintiff get on the frost-covered roof.

The critical issue in this case is whether defendant, under the circumstances, should have expected that plaintiff would not protect himself from the danger that was open and obvious to both of them. Under § 343 of the Restatement (Second) of Torts a "possessor of land" may be liable "for physical harm caused to his invitees by a condition on the land if the possessor "should expect that they will not discover or realize the danger, or will fail to protect themselves against it." Section 343 should be read together with § 343A, which provides that "[a] possessor of land is not liable to his invitees for physical harm caused to them by any activity or condition on the land whose danger is known or obvious to them, unless the possessor should anticipate the harm despite such knowledge or obviousness." Restatement (Second) of Torts § 343A

We recognize that some of our older cases concerning this area of the law have found no liability to an invitee when an injury was caused by a condition that was obvious or known to the invitee. These decisions arose when contributory negligence was a total defense to negligence liability.We concur with the holding of Wisdom v. TJX Companies, Inc., 410 F. Supp. 2d 336, 344 (D. Vt. 2006), that while "Vermont law has traditionally afforded a measure of protection to business owners whose invitees injure themselves by disregarding obvious dangers," this protection now bears more on the plaintiff's comparative negligence than on the defendant's duty of care.

We conclude that the facts of this case, as alleged, do not preclude a finding of duty under § 343 and § 343A, The key alleged fact in this case is that defendant, in a position of authority vis-à-vis plaintiff, ordered him to go onto the frosted roof despite the obvious danger involved. A jury could conclude that, in ordering plaintiff to climb onto the roof despite its dangerous condition acknowledged by both defendant and plaintiff, defendant should have anticipated that the condition of the roof presented an unreasonable risk of harm to plaintiff. A jury could conclude that defendant breached a duty to protect plaintiff from encountering an open-and-obvious dangerous condition on his property by demanding that he encounter the dangerous condition. Accordingly, the superior court's grant of summary judgment to defendant on plaintiff's premises liability claim was inappropriate

ROBINSON, J., concurring in part and dissenting in part. I cannot join the majority's conclusion that defendant, as the property owner, can be held liable pursuant to the common law of premises liability for injuries resulting when a roofer climbed onto a frost-covered roof, stripped of shingles and covered with underlayment, thereby encountering dangers that were obvious and acknowledged by plaintiff before he climbed onto the roof. The majority's analysis suffers from two critical flaws: First, it misconstrues the scope of a landowner's common law duties concerning the condition of the premises in circumstances like this. Second, it rests on the assertion that defendant's familial relationship with plaintiff gave defendant "authority" over plaintiff such that defendant was legally accountable as landowner for plaintiff's choices.

I is difficult to imagine what the landowner's duty would be in this case. It clearly isn't a duty to warn, because there is no dispute that plaintiff was fully on notice of the danger. The reality is, this is not really a premises liability case at all. That is, plaintiff's claim is not really predicated on unreasonably dangerous conditions of the premises. Plaintiff's claim is that his grandfather goaded him into doing something dangerous, and he was injured as a result. This isn't a premises liability claim. It is not tied to defendant's status as landowner, or a breach of any duty with respect to the condition of the land.

In connection with the premises liability claim, there is no evidence that plaintiff was not competent, or had a special, cognizable vulnerability. Plaintiff was undisputedly a mature, twenty-seven-year-old man at the time of the accident. If there is a tort theory that supports liability when a defendant urges another competent adult to undertake dangerous activity, plaintiff has not pled or argued it.

I dissent from the majority's analysis of the premises liability claim. I would affirm that claim.

SCOVT NOTE: An example of where the Restatement says the possessor “should anticipate the harm despite such knowledge or obviousness” is where “the possessor has reason to expect that the invitee's attention may be distracted, so that he will not discover what is obvious, or will forget what he has discovered, or fail to protect himself against it. Restatement (Second) of Torts § 343A, comment f. (1965) The current Restatement's view on “open and obvious" dangers is stated in Restatement (Third) of Torts: Phys. & Emot. Harm § 51 (2012), comment k.  Compare Menard v. Lavoie, 174 Vt. 479, 806 A.2d 1004, 1006 (2002) (mem.) (homeowners not negligent as a matter of law for spiral staircase fall because "[w]hatever dangers the stairs posed were obvious to any observer, and were well known by plaintiff”) with Ainsworth v. Chandler, 2014 VT 107  (holding a reasonable jury could conclude that either the danger on a stairway was not open and obvious or "that defendant should have foreseen the harm even if the danger was obvious.").

Wednesday, June 21, 2017

Attorneys do not owe a duty to non-client prospective beneficiaries of undrafted, unexecuted wills.

Strong v. Fitzpatrick, 2017 VT 35 [May 12, 2017]

REIBER, C.J. In this legal malpractice case, plaintiff claims that his deceased mother’s attorney failed to draft a will reflecting her alleged intent to leave plaintiff a greater share of real estate than that left to his siblings. Plaintiff appeals the trial court’s summary judgment decision for defendant, arguing that defendant owed him a duty of care as a prospective beneficiary of his mother’s estate. We disagree and therefore affirm,

Plaintiff argues that “if an attorney owes a duty of care to intended beneficiaries of estate planning legal services the duty must encompass an obligation to complete a contracted-for will, already begun, in a reasonable amount of time, or at least obligate the lawyer to inform the client that he will not complete the drafted will so that client can hire another lawyer to do the work.”

As this Court has previously observed, courts around the country have made exceptions to the general rule requiring attorney-client privity, often in the estate-planning or will-drafting context. See, e.g., Hedges, 2003 VT 63, ¶ 7 ("Many courts have held lawyers liable to nonclient plaintiffs for negligence where the plaintiff is an intended third-party beneficiary of the attorney-client relationship—in estate-planning and will-drafting cases for example."); Bovee, 174 Vt. at 488, 811 A.2d at 140 ("[A] number of courts have relaxed the privity rule in limited circumstances—most often in the estate-planning context—where it can be shown that the client's purpose in retaining the attorney was to directly benefit a third party.")

Plaintiff’s case is not about negligent drafting but rather about the absence of any drafting. We reject plaintiff’s request to extend an exception to the general rule to the circumstances of this case; imposing on attorneys a duty to prospective beneficiaries of undrafted, unexecuted wills would undermine the duty of loyalty that an attorney owes to his or her client and invite claims premised on speculation regarding the testator’s intent.

We hold that attorneys do not owe a duty to non-client prospective beneficiaries of undrafted, unexecuted wills and therefore do not recognize an exception here to the general rule requiring attorney-client privity to maintain a legal malpractice action.

Tuesday, June 20, 2017

Summary judgment: Divided Court holds "bald" affidavit creates no issue of fact.

H&E Equipment Services, Inc. v. Cassani Electric, Inc., 2017 VT 17 9

SKOGLUND, J. Defendant Nicholas Cassani appeals from the trial court’s order granting summary judgment to plaintiff H&E Equipment Services, Inc. on its complaint to collect on a 2001 Arizona judgment. Defendant argues that the action is time-barred under 12 V.S.A. § 506. Alternatively, he contends that there is a material dispute of fact as to whether the Arizona court had personal jurisdiction over him at the time it entered its judgment. We affirm

Defendant argued that the Arizona judgment should not be enforced because he was not properly served with the complaint in the underlying Arizona action. He provided a sworn statement to this effect and argued that his affidavit created a material dispute of fact. Even if the Arizona court had jurisdiction over him, defendant asserted that the judgment could not be enforced in Vermont under 12 V.S.A. § 506

Given the Arizona judgment's recital that defendant was in fact served the court found that defendant had the burden of making a reasonable showing that he was not actually served beyond his mere assertion to this effect.

We begin with defendant's assertion that this action is time-barred under 12 V.S.A. § 506. Defendant reads the statute to require that any action on a judgment must be brought within eight years from the date of the "original judgment." We reject defendant's interpretation of 12 V.S.A. § 506 because it would lead to absurd results. Section 506 provides that "[a]ctions on judgments and actions for the renewal or revival of judgments shall be brought by filing a new and independent action on the judgment within eight years after the rendition of the judgment, and not after." The phrase "rendition of the judgment" is not limited to the "original" judgment, as defendant posits. Section 506 specifically provides for the renewal of judgments; and when a judgment is renewed—in Vermont or elsewhere under another state's laws—the date of the renewed judgment is controlling for purposes of 12 V.S.A. § 506.

We agree with the trial court that defendant failed to establish that a genuine dispute of material fact existed as to whether he was served with the Arizona complaint. Certainly, under other circumstances, a party's affidavit might suffice to create a dispute of material fact sufficient to defeat summary judgment. In this case, however, the Arizona judgment was presumptively valid and the judgment recited that defendant had been served with the complaint. Defendant's bald assertion concerning lack of service was insufficient to create a genuine factual dispute regarding service.

Because defendant failed to put forth sufficient evidence to rebut the presumptively valid foreign judgment or draw into question the express finding by the Arizona court that he was properly served, mmary judgment was properly granted to H&E

ROBINSON, J., concurring in part, dissenting in part. The majority suggests that testimony about a critical fact, given under oath and based on personal knowledge, is insufficient to create a dispute of material fact for purposes of summary judgment. That is a dramatic departure from well-established and universal principles of summary judgment adjudication. I dissent from the majority’s holding that defendant failed to establish a genuine dispute of material fact as to whether he was served with the Arizona complaint and would reverse the trial court’s summary judgment ruling on that basis.

I am authorized to state that Justice Dooley joins this concurrence and dissent. 

SCOVT Reverses summary judgment in will contest because of conflicting evidence as to whether testator intended the will to be a conditional or absolute will

In re Holbrook, 2017 VT 15 

REIBER, C.J. The question presented in this will contest is whether the trial court correctly determined on summary judgment that the testator intended a last will and testament which she executed on the eve of surgery to be absolute rather than contingent on her surviving the surgery. We conclude that summary judgment was premature in this case because material factual issues remained in dispute concerning the testator’s intent, and therefore reverse.

The court found that neither of the competing inferences from the evidence was "more compelling than the other." and concluded that "the presumption against intestacy" must control, thus precluding a construction of the will as conditional.

It is correct that there is a general reluctance in estate law to find intestacy, hence the general preference for a clear expression of contingency. But when the evidence is in conflict on a genuine, material issue of fact—in this case whether testator intended the will to expire or to remain in effect after she survived her surgery—the usual and proper course is not to ignore that evidence as "ambiguous" but to deny the motion for summary judgment and permit the case to proceed to trial, where the trier of fact may weigh all of the evidence, assess the credibility of the witnesses, and ultimately resolve the factual dispute. The court could not rely on "presumptions."

Because the parties here offered conflicting evidence as to whether testator intended the will to be a conditional or absolute will, the case must be remanded for a trial to resolve that issue.

 Reversed and remanded

SCOVT affirms conviction for DUI death resulting. No abuse of discretion under Rule 702 in allowing pharmacologist/toxicologist to testify that defendant’s intoxication was the cause of the accident

EATON, J. Defendant was convicted of operating a motor vehicle while under the influence of intoxicating liquor (DUI) with death resulting, in violation of 23 V.S.A. §§ 1201(a)(2) and 1210(f)(1), and leaving the scene of a fatal accident, in violation of 23 V.S.A. § 1128(a) and (c). On appeal, he challenges the trial court’s jury instructions, admission of expert testimony, and denial of his motion for access to necessary services as a needy person pursuant to 13 V.S.A. § 5231(a)(2). We affirm defendant’s convictions but remand the matter for resentencing based on our conclusion that the trial court abused its discretion by not continuing the sentencing hearing to allow defendant to present the testimony of his expert witness.

Although we agree with defendant that the “death resulting” element requires a finding that defendant’s intoxication was a but-for cause of the victim’s death, we do not agree with his argument that the trial court’s jury instruction failed to convey this causation requirement

The State offered expert testimony from a board-certified pharmacologist and toxicologist who focuses on drugs and medications. Defendant argues that the witness is not an expert in alcohol, and thus his testimony as to whether defendant was under the influence of alcohol at the time of the accident was outside the scope of his expertise. Defendant also argues that his opinion as to the cause of the accident was also outside the scope of his expertise. 

Trial courts have “broad discretion to determine, on a case-by-case basis, whether some or any of the [Daubert] factors are relevant to evaluating the reliability of expert evidence before the court.” We are not persuaded that the trial court abused its discretion in determining that the testimony was sufficiently reliable for the jury to consider it. The opinions proffered by the State’s expert do not represent the type of “junk science” Daubert intended to thwart; rather, the testimony was supported by the witness’s qualifications as an experienced clinical pharmacologist and toxicologist whose work focuses on the effects of drugs and medications, including the pharmacodynamics of alcohol. Further, the witness detailed how his understanding of the effects of alcohol led to his opinion that the most likely cause of an accident under the circumstances of this case was defendant’s driving while intoxicated. This testimony was within his area of expertise, and the trial court did not abuse its discretion in so concluding.

The convictions are affirmed. The sentence is vacated and the matter is remanded for resentencing to allow defendant sufficient opportunity to present expert mitigation testimony, either at his own expense or at state expense if he is found to qualify for necessary services upon any renewed application for such services pursuant to the guidelines set forth in Administrative Order 4, § 5.