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COA reverses trial court's ruling in favor of attorney

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The Indiana Court of Appeals has reversed a trial court’s grant of summary judgment in favor of an attorney who failed to monitor an estate checking account while serving as the estate’s counsel.

In Corrine R. Finnerty, as Successor Personal Representative of the Estate of Dora Grace Lee, deceased v. Joseph A. Colussi and the Colussi Law Office, No. 39A01-1011-ES-622, Corrine Finnerty appeals a trial court’s ruling in favor of attorney Joseph Colussi, claiming that genuine issues of material fact exist to preclude judgment in favor of Colussi on a legal malpractice claim.

Dora Grace Lee died in 2007, and her designated co-personal representatives – sister Helen Ricketts and granddaughter Christina Mason – hired Colussi as the estate’s counsel.

On February 6, 2007, Colussi mailed Mason and Ricketts their letters testamentary along with the court’s order appointing them as co-personal representatives and letters explaining that either document would allow them to conduct business for the estate. The letter to Mason instructed her to “immediately open up an estate account and handle all expenses and deposit all income in that account” and to forward a check to Colussi to reimburse him for the estate’s filing fee. The letter to Ricketts made no mention of a bank account or filing fee. Colussi had previously advised Mason and Ricketts that either of them could write checks on the estate account, and it was agreed that Mason would retain the estate’s checkbook.

Mason and Ricketts opened an account at Main Source Bank in Madison, Ind., but did not establish an “and” account, which would have required both parties to sign checks. Instead, the two set-up an “or” account, meaning either could write checks independently. Only Mason received a checkbook and monthly account statements from the bank.

Over the next several months, Ricketts and Mason liquidated the estate’s assets and deposited approximately $236,000 into the account. However, unbeknownst to Ricketts and Colussi, Mason began writing checks on the estate account for her personal use, the use of her family and in-laws, and the use of the three other beneficiaries of the will. The majority of the estate funds were depleted by September 11, 2007.

On October 31, 2007, Ricketts contacted Colussi and told him that she suspected problems existed with the account. Ricketts, per Colussi’s instructions, contacted the bank and learned the account was overdrawn. Colussi and Ricketts then reported Mason’s embezzlement to police, and both Ricketts and Mason resigned as co-personal representatives, Colussi withdrew as estate counsel, and Corrine Finnerty was appointed as personal representative.

In February 2009, the estate filed a complaint against Colussi alleging that he had committed legal malpractice by failing “to inform himself as to the status of estate assets or monitor their use.” Colussi filed a counterclaim to recover from the estate unpaid attorney fees. The estate enlisted expert Thomas C. Bigley, Jr., who said Colussi breached the applicable standard of care by failing to control and monitor the checking account. The trial court ruled in favor of Colussi, holding that: “The testimony of Bigley and Finnerty as to their practice as attorneys in monitoring an estate bank account are simply their personal opinions based on their own experiences which renders their opinions as to Colussi’s actions lacking foundation and inadmissible conclusions of law.”

The COA called that conclusion “puzzling,” writing that personal experience is often the source of an expert’s expertise. The appeals court held that in order to prove a breach of duty, the estate needed to prove only that Colussi’s behavior fell below the applicable standard of care.

In his deposition, Bigley testified that the applicable standard of care requires an attorney for an estate to retain the estate’s checkbook, thereby requiring the personal representative to come to the attorney’s office to obtain checks. He also said he would have monitored more carefully the opening of the estate and would have monthly bank statements from the estate sent to his office. Accordingly, the appeals court held that the trial court erred when it ruled in favor of Colussi.

According to the estate, because a genuine issue of material fact exists as to whether Colussi is liable for malpractice, a genuine issue of material fact must necessarily exist with regard to Colussi’s counterclaim for unpaid attorney fees. The appeals court agreed, and remanded for proceedings consistent with its opinion.
 

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  • This opinion makes me shudder
    According to the court of appeals, any attorney in the state can now offer his personal practice and say "I think other attorneys should do that do" and create a standard of care. So, we become guarantors for the actions of our clients, in essence. About the only way to defend yourself from enterprising legal malpractice lawyers is to make sure you have a clearly defined scope of responsibility in your engagement letter. I hope Finnerty loses at trial (since she should stand in the shoes of the PR who embezzled the money in the first place).

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  1. The practitioners and judges who hail E-filing as the Saviour of the West need to contain their respective excitements. E-filing is federal court requires the practitioner to cram his motion practice into pigeonholes created by IT people. Compound motions or those seeking alternative relief are effectively barred, unless the practitioner wants to receive a tart note from some functionary admonishing about the "problem". E-filing is just another method by which courts and judges transfer their burden to practitioners, who are the really the only powerless components of the system. Of COURSE it is easier for the court to require all of its imput to conform to certain formats, but this imposition does NOT improve the quality of the practice of law and does NOT improve the ability of the practitioner to advocate for his client or to fashion pleadings that exactly conform to his client's best interests. And we should be very wary of the disingenuous pablum about the costs. The courts will find a way to stick it to the practitioner. Lake County is a VERY good example of this rapaciousness. Any one who does not believe this is invited to review the various special fees that system imposes upon practitioners- as practitioners- and upon each case ON TOP of the court costs normal in every case manually filed. Jurisprudence according to Aldous Huxley.

  2. Any attorneys who practice in federal court should be able to say the same as I can ... efiling is great. I have been doing it in fed court since it started way back. Pacer has its drawbacks, but the ability to hit an e-docket and pull up anything and everything onscreen is a huge plus for a litigator, eps the sole practitioner, who lacks a filing clerk and the paralegal support of large firms. Were I an Indiana attorney I would welcome this great step forward.

  3. Can we get full disclosure on lobbyist's payments to legislatures such as Mr Buck? AS long as there are idiots that are disrespectful of neighbors and intent on shooting fireworks every night, some kind of regulations are needed.

  4. I am the mother of the child in this case. My silence on the matter was due to the fact that I filed, both in Illinois and Indiana, child support cases. I even filed supporting documentation with the Indiana family law court. Not sure whether this information was provided to the court of appeals or not. Wish the case was done before moving to Indiana, because no matter what, there is NO WAY the state of Illinois would have allowed an appeal on a child support case!

  5. "No one is safe when the Legislature is in session."

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