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Ball v. Birch9/27/2002
[No. 5634 - September 27, 2002]
I. INTRODUCTION
A law firm's clients sued the firm. They claimed, among other things, that the firm was negligent in negotiating a commercial transaction and preparing transactional documents. The law firm moved for complete summary judgment; it submitted in support an expert's report that addressed only the document-preparation claim. When the plaintiffs repeatedly failed to produce expert opinions to oppose the firm's summary judgment motion or support their malpractice claims, the superior court granted the firm complete summary judgment. We discern no error as to the document-preparation claim because plaintiffs did not preserve any genuine factual dispute as to that claim. But as to all claims the firm's expert did not address, we reverse and remand because the firm did not make out a prima facie showing that it was entitled to summary judgment as to those claims.
II. FACTS AND PROCEEDINGS
A. The Transaction
Gerald Ball, Albert Newton Ball, and Albert Ball, Jr. (the Balls) sought to sell their cargo airline businesses and began negotiations with a prospective purchaser in early 1991. The purchaser tendered two $200,000 checks but they were returned for insufficient funds. The checks' return and other circumstances raised a question about whether to proceed with the sale or terminate discussions with the would-be buyer. The Balls retained the Anchorage law firm of Birch, Horton, Bittner, and Cherot to continue negotiations with the prospective buyer and to draft documents for the sale of the businesses. Attorney Hal Horton of that firm was the Balls' lead lawyer.
According to their sworn discovery responses they later provided, two of the Balls had doubts about the "deal" and had wanted to end negotiations, but Horton insisted on continuing. After the transactional documents were executed, the purchaser defaulted on the first payment and the Balls foreclosed on what property they could.
B. The Lawsuit
The Balls filed a malpractice complaint against Horton and the law firm (collectively "Birch, Horton" or the "law firm") in October 1997. The complaint alleged that Birch, Horton "failed to meet the standard of care of the legal profession . . . in negotiating the sale the Stock and in drafting the documents for the sale of the Stock in the Corporations." The complaint prayed for damages exceeding $5,000,000.
The attorney who filed the Balls' malpractice lawsuit became incapacitated in the summer of 1999 and all of his cases, including the Balls' lawsuit, were referred to trustee counsel for some months. The original lawyer briefly resumed representing the Balls in early 2000.
Birch, Horton moved for summary judgment in January 2000 and supported its motion with a May 1999 report prepared by its expert, Fairbanks attorney Charles E. Cole. Birch, Horton served the report on the Balls in May 1999, and again served the report on them with its January 2000 summary judgment motion. We discuss the report in Part III.B. The law firm also filed a separate motion for partial summary judgment on the issue of punitive damages.
The Balls' original litigation lawyer, having resumed representing the Balls in early January 2000, moved to continue the trial and extend the time to oppose summary judgment. He claimed in his supporting memorandum that he had "retained a local attorney to act as the expert in the case," but learned after he returned to Anchorage that this attorney "had discovered a conflict of interest with the defendant law firm" and would no longer serve as an expert. He asked for additional time in which to engage anoth
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