ILNews

COA reverses trial court's ruling in favor of attorney

Back to TopCommentsE-mailPrintBookmark and Share

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.
 

ADVERTISEMENT

  • 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).

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. I grew up on a farm and live in the county and it's interesting that the big industrial farmers like Jeff Shoaf don't live next to their industrial operations...

  2. So that none are misinformed by my posting wihtout a non de plume here, please allow me to state that I am NOT an Indiana licensed attorney, although I am an Indiana resident approved to practice law and represent clients in Indiana's fed court of Nth Dist and before the 7th circuit. I remain licensed in KS, since 1996, no discipline. This must be clarified since the IN court records will reveal that I did sit for and pass the Indiana bar last February. Yet be not confused by the fact that I was so allowed to be tested .... I am not, to be clear in the service of my duty to be absolutely candid about this, I AM NOT a member of the Indiana bar, and might never be so licensed given my unrepented from errors of thought documented in this opinion, at fn2, which likely supports Mr Smith's initial post in this thread: http://caselaw.findlaw.com/us-7th-circuit/1592921.html

  3. When I served the State of Kansas as Deputy AG over Consumer Protection & Antitrust for four years, supervising 20 special agents and assistant attorneys general (back before the IBLE denied me the right to practice law in Indiana for not having the right stuff and pretty much crushed my legal career) we had a saying around the office: Resist the lure of the ring!!! It was a take off on Tolkiem, the idea that absolute power (I signed investigative subpoenas as a judge would in many other contexts, no need to show probable cause)could corrupt absolutely. We feared that we would overreach constitutional limits if not reminded, over and over, to be mindful to not do so. Our approach in so challenging one another was Madisonian, as the following quotes from the Father of our Constitution reveal: The essence of Government is power; and power, lodged as it must be in human hands, will ever be liable to abuse. We are right to take alarm at the first experiment upon our liberties. I believe there are more instances of the abridgement of freedom of the people by gradual and silent encroachments by those in power than by violent and sudden usurpations. Liberty may be endangered by the abuse of liberty, but also by the abuse of power. All men having power ought to be mistrusted. -- James Madison, Federalist Papers and other sources: http://www.constitution.org/jm/jm_quotes.htm RESIST THE LURE OF THE RING ALL YE WITH POLITICAL OR JUDICIAL POWER!

  4. My dear Mr Smith, I respect your opinions and much enjoy your posts here. We do differ on our view of the benefits and viability of the American Experiment in Ordered Liberty. While I do agree that it could be better, and that your points in criticism are well taken, Utopia does indeed mean nowhere. I think Madison, Jefferson, Adams and company got it about as good as it gets in a fallen post-Enlightenment social order. That said, a constitution only protects the citizens if it is followed. We currently have a bevy of public officials and judicial agents who believe that their subjectivism, their personal ideology, their elitist fears and concerns and cause celebs trump the constitutions of our forefathers. This is most troubling. More to follow in the next post on that subject.

  5. Yep I am not Bryan Brown. Bryan you appear to be a bigger believer in the Constitution than I am. Were I still a big believer then I might be using my real name like you. Personally, I am no longer a fan of secularism. I favor the confessional state. In religious mattes, it seems to me that social diversity is chaos and conflict, while uniformity is order and peace.... secularism has been imposed by America on other nations now by force and that has not exactly worked out very well.... I think the American historical experiment with disestablishmentarianism is withering on the vine before our eyes..... Since I do not know if that is OK for an officially licensed lawyer to say, I keep the nom de plume.

ADVERTISEMENT