• Going Rogue: Indiana Court Allows Expert To Set Standard Of Care Based Upon Expert’s Personal Practices Alone
  • March 7, 2013
  • Law Firm: Kightlinger Gray LLP - Indianapolis Office
  • In the 2011 case of In re Estate of Lee, the Indiana Court of Appeals reversed the trial court’s order granting summary judgment to an attorney sued for malpractice in a probate proceeding. 954 N.E.2d 1042, 1050 (Ind. Ct. App. 2011) (trans. denied 967 N.E.2d 1034). To justify doing so, the court allowed the testimony of plaintiff’s expert witness despite the fact that the expert’s testimony was based only on his on personal practice, as opposed to what he knew to be the general practice in his community.  The expert was clear in his testimony that in his own practice, he would have acted differently than the defendant because “that’s the way his dad taught him,” not because he knows that to be common practice.  The Indiana Court of Appeals’ holding in Lee is a departure from settled law on the issue, and is out of step with jurisprudence in states across the country. Further, the Lee decision creates serious implications for malpractice defense lawyers, because it arguably would allow any expert to set the applicable standard of care based upon the expert’s own personal practices. Additionally, it could make summary judgment in malpractice cases much more difficult to obtain.
    1.      In re Estate of Lee Analyzed: A Fly in the Ointment.
    In In re Estate of Lee, an Estate sued its former attorney, alleging that he failed to track the activities of one of the personal representatives of the Estate to prevent her from stealing substantial funds from the Estate’s checking account. When the Estate was opened, there were two personal representatives designated by the decedent’s will.  Attorney Joe Colussi advised both personal representatives that they should sign checks jointly on the Estate’s account, but it was later agreed that only one of the two would retain the Estate’s checkbook. The personal representative who retained the Estate’s checkbook wrote personal checks unnoticed by the other, and completely depleted the Estate’s funds. This action was then instituted by the Estate, which claimed that Colussi committed malpractice in failing to keep himself informed of the Estate’s assets and/or monitor their use.
    Colussi moved for summary judgment on the basis that he owed no duty to control the checkbook or monitor the Estate account. It was undisputed by the parties that no statute, case, treatise, rule of procedure, local rule, legal article, or seminar article established a duty on the part of an Indiana attorney to control an estate checking account or to monitor the personal representative’s use of an estate account. Thus, the plaintiff relied solely on expert testimony to attempt to establish the standard of care. The plaintiff’s designated expert, however, admitted in his deposition that he had no idea what other lawyers do in this regard.  He had himself taught seminars on estate practice and never included a duty to monitor an estate checking account as part of his instruction.  He also acknowledged that the only way Colussi would know he needed to do so was to call the expert and ask him.
    While the trial court found that Colussi had a general duty as the Estate’s attorney to provide those services that an estate attorney would typically provide to carry out that duty, the judge found no basis to impose on Colussi a duty to monitor the Estate’s bank account. Specifically, the trial court found that the expert testimony presented by the Estate as to the applicable standard of care was simply the personal opinions of the expert based solely on his own personal practice and experience. Thus, the trial court found that those opinions lacked foundation and were inadmissible conclusions of law.
    The Indiana Court of Appeals reversed the trial court’s grant of summary judgment, holding that genuine issues of material fact precluded disposition under Trial Rule 56.  The appellate court found that because Colussi was employed as an attorney for the Estate, he owed a general duty to exercise ordinary skill and knowledge as an attorney. In other words, the court of appeals subsumed the trial court’s determination of duty into a question of breach, i.e. whether the failure to monitor the bank account was a breach of Colussi’s duty.  Consequently, having concluded that there was a duty owed, the court of appeals moved on to analyze whether there was a breach.
    Given that approach, the appellate court considered the expert’s testimony sufficient to create a question of fact, thereby preventing summary judgment.  The basis of the designated expert’s testimony was that Colussi owed a duty to retain the checkbook and monitor the Estate checking account. Even though the basis for the expert’s recital of that standard of care was solely his own practice, the appellate court found that sufficient to create a question of fact as to whether a breach had occurred.  The court of appeals ignored the deficiencies in that expert’s testimony and concluded, based solely upon that testimony, that the Estate had established sufficient evidence to avoid summary disposition.  The court of appeals also expressly stated that the Estate did not need to establish via expert testimony a uniform or accepted practice by attorneys in order to establish a standard of care.
    2.  Weight of Case Law from Around the Country Supports Alternative Approaches to In re Estate of Lee.
    The state case law from around the country that addresses this admittedly critical issue appears to be predominantly opposed to the rationale In re Estate of Lee. However, at least one jurisdiction seems to embrace the logic employed by the Indiana Court of Appeals.
    New Jersey is particularly explicit when dealing with the issue of whether an attorney may rely upon his or her own personal practices when testifying as an expert on the standard of care. Courts in New Jersey have consistently held that personal opinion and practice are not proper bases for attorney testimony purporting to establish a standard of care. See, e.g., Carbis Sales Inc. v. Eisenberg, 935 A.2d 1236 (N.J. Super. Ct. App. Div. 2007); Stoeckel v. Township of Knowlton, 902 A.2d 930 (N.J. Super. Ct. App. Div. 2006); and Kaplan v. Skoloff & Wolfe, P.C., 770 A.2d 1258 (N.J. Super. Ct. App. Div. 2001). This line of cases stands for the proposition that “[i]n the context of legal malpractice, an expert must base his or her opinion on standards accepted by the legal community and not merely on the expert’s personally held views.”  See, e.g., Eisenberg, 935 A.2d at 1245 (citing both Stoeckel and Kaplan, supra). The court in Kaplan ordered judgment as a matter of law for the defendant-attorney based on the following rationale:
    Plaintiff's expert offered no evidential support establishing the existence of a standard of care, other than standards that were apparently personal to himself.  In this regard, Ambrosio [the expert] failed to reference any written document or unwritten custom accepted by the legal community recognizing what would constitute a reasonable settlement under the facts presented in this case.  In this stark absence of supporting authority, Ambrosio provided only his personal view.
    Kaplan, 770 A.2d at 1262.
    Other states have addressed the foundation for attorney expert opinions similarly to the courts in New Jersey.
    In Illinois, one court found that an attorney could testify on the standard of care with respect to professional duties even though the expert was not a practitioner in the same field as the defendant. First Nat. Bank of LaGrange v. Lowrey, 375 Ill. App. 3d 181 (Ill. App. Ct. 2007). In so holding, the court found that the expert’s lack of personal experience in the defendant’s field was “irrelevant” to his testimony regarding the standard of care. Id. at 198. The expert in that case based his opinions on the Rules of Professional Conduct as they apply to all attorneys, instead of relying on personal practices within the particular field at issue. Id. at 196-97. Using the Rules of Professional Conduct as a non-dispositive basis for expert opinion on an attorney’s standard of care is common across the United States, as discussed infra.
    Similarly, in Wyoming, courts have held that “[a]n expert witness could not state that the standard is to do one thing or another.” Gayheart v. Goody, 98 P.3d 164, 172 (Wyo. 2004) (quoting Moore v. Lubnau, 855 P.2d 1245, 1251 (Wyo. 1993)). In Gayheart, the court found that the attorney expert witnesses had demonstrated by their testimony that the defendant’s actions were within the standard of care for Wyoming attorneys. Id. This locality approach is common across the country and is discussed, infra.
    On the other hand, it seems that at least one jurisdiction might support the logic that underlies the Indiana Court of Appeals decision In re Estate of Lee. Connecticut courts have stated as follows in qualifying an attorney to testify as to the standard of care in a legal malpractice action:
    [A]n expert must show more than a “casual familiarity” with the standards of the specialty in question . . . In that regard, however, it makes no difference whether the witness' familiarity results from practical or academic experience . . .  Once the threshold question of usefulness to the jury has been satisfied, any other questions regarding the expert's qualifications properly go to the weight, and not to the admissibility, of his testimony.
    Davis v. Margolis, 576 A.2d 489, 493-94 (Conn. 1990) (internal citations omitted). However, it is important to note that the Davis court was merely relying on the proposed expert’s practical experience in order to qualify the witness. Such evidence did not directly relate to establishing the standard of care. Thus, even this line of cases does not directly support the Indiana Court of Appeals’ logic in In re Estate of Lee. On balance, the weight of authority around the country seems to undercut the position taken by the court in the Lee case with regard to establishing the standard of care for attorneys.
    3.   Two Common Approaches to Standard of Care Testimony That Are At Odds With the Decision In re Estate of Lee.
    There are two common approaches to evaluating the effect of expert testimony on the standard of care in legal malpractice claims - and neither approach is based upon the personal opinion or practice of one attorney.
    First, experts may use the Rules of Professional Conduct to help define the standard of care for attorneys with respect to their clients. Though they are not dispositive, the Rules of Professional Conduct are used in many jurisdictions as a proper basis to form expert opinions on the standard of care in legal malpractice cases. See, e.g., Lowrey, 375 Ill. App. 3d 181; Waldman v. Levine, 544 A.2d 683 (D.C. 1988); Mainor v. Nault, 101 P.3d 308 (Nev. 2004) (noting court chose to adopt majority rule, which permitted experts to rely on Rules of Professional conduct in forming opinions); Teague v. St. Paul Fire and Marine Ins. Co., 10 So.3d 806 (La. Ct. App. 2009) (holding that Rules of Professional Conduct were not dispositive, but along with expert testimony could be used to establish standard of care); Ahan v. Grammas, 2009 MDBT 9 (Md. Cir. Ct. 2004) (holding that expert on the Rules of Professional Conduct could testify on the standard of care in a field in which he was not a practitioner, because Rules pertained to all attorneys). 
    Second, state courts employ a locality approach to determine the applicable standard of care in the region where the alleged malpractice took place. See, e.g., Chapman v. Bearfield, 207 S.W.3d 736 (Tenn. 2006) (statewide standard of care was applicable); Ballesteros v. Jones, 985 S.W.2d 485 (Tex. Ct. App. 1998) (standard of care for a particular county); Wolski v. Wandel, 746 N.W.2d 143 (Neb. 2008) (standard of care for a particular city); Rorrer v. Cooke, 329 S.E.2d 355 (N.C. 1985) (standard of care in the same or similar locality). These courts all use expert testimony to establish the standard of care for attorneys in a specific location.
    Neither approach from these other jurisdictions referenced above contemplates the use of personal opinion in establishing a standard of care for attorneys in malpractice actions.
    4.      Proposed Legislation Could Remedy the Standard of Care for Estate Practitioners.
    The Indiana General Assembly’s Probate Code Study Commission has recommended the Preliminary Draft Bill PD3188. That Bill proposes to amend the Indiana Probate Code to define an estate lawyer and specifically limits the duties of such a lawyer.  According to the Bill, an estate lawyer is a lawyer who performs services for an estate at the request of the personal representative. The lawyer only owes a duty to the personal representative and owes no duty to monitor or account for estate assets, unless directed by a court. Further,  the lawyer would not be liable for any loss suffered by the estate, except to the extent that the loss was caused by the lawyer’s breach of duty owed to the personal representative. Clearly, this Bill seeks to remedy the overstated duty for estate practitioners pronounced by Lee. Unfortunately, the passing of this Bill would only fix a narrow application of Lee. It obviously would clarify the duty of estate lawyers, but it fails to address the fundamental problem of allowing an expert to set the standard of care based solely upon his or her personal practice.
    It appears that In re Estate of Lee is an outlier in the case law from across the country. However, should its logic begin to take hold in other jurisdictions, it would pose significant obstacles for the defense of legal malpractice cases.  First, Lee arguably would allow any expert to set the applicable standard of care based upon the expert’s own personal practices, without any advance notice to the defendant of the purported standard of care. Second, it makes summary judgment in malpractice cases much more difficult, if not impossible, to obtain. Once a duty is established (i.e., employment of the attorney), any attempt to narrow the discussion of duty likely would be analyzed under the issue of whether the attorney breached his or her duty.