Civil Law & Litigation for Paralegals 1st Edition by Neal Bevans

تمرين 26

When a paralegal performs legal services with [the] knowledge that there is no supervising attorney responsible for the case, the paralegal will be held to an attorney's standard of care. Attorneys have a duty to keep their clients informed about material developments in their cases. The trial court found that Deloris Mullen, a paralegal, and Lorinda Noble, an attorney, while employed by a non-lawyer who represented accident victims, breached this duty and caused harm to the plaintiffs when they failed to advise them of the risk involved with allowing a non-lawyer to settle their cases. We affirm the judgments.
The trial court's findings of fact present the following account of the events surrounding this dispute. Between 1989 and 1991, plaintiffs Maria Tegman, Linda Leszynski, and Daina Calixto were each injured in separate and unrelated automobile accidents. After their accidents, each plaintiff retained G. Richard McClellan and Accident Medical Investigations, Inc. (AMI) for legal counsel and assistance in handling their personal injury claims. McClellan and AMI purported to represent each plaintiff in seeking compensation from insurance companies for their injuries. Each plaintiff signed a contingency fee agreement with AMI, believing that McClellan was an attorney and AMI a law firm. McClellan has never been an attorney in any jurisdiction.
McClellan and AMI employed Camille Jescavage and Lorinda Noble, both licensed attorneys. Jescavage and Noble learned that McClellan entered into contingency fee agreements with AMI's clients and that McClellan was not an attorney. They settled a number of cases for AMI, and learned that McClellan processed settlements of AMI cases through his own bank account. Noble resigned from AMI in May 1991, after working there approximately six months.
In July 1991, McClellan hired Deloris Mullen as a paralegal. Mullen considered Jescavage to be her supervising attorney though Jescavage provided little supervision. Jescavage resigned from AMI in the first week of September 1991. McClellan told Mullen that her new supervising attorney would be James Bailey. Mullen did not immediately contact Bailey to confirm that he was her supervising attorney. He later told her he was not.
While at AMI, Mullen worked on approximately 50-60 cases, including those of plaintiffs Tegman, Leszynski[,] and Calixto. Mullen was aware of some of McClellan's questionable practices and knew that there were substantial improprieties involved with his operation. Mullen stopped working at AMI on December 6, 1991, when the situation became personally intolerable to her and she obtained direct knowledge that she was without a supervising attorney. When she left, she did not advise any of the plaintiffs about the problems at AMI. After Mullen left, McClellan settled each plaintiff's case for various amounts without their knowledge or consent, and deposited the funds in his general account by forging their names on the settlement checks.
In 1993, Calixto, Leszynski, and Tegman each individually sued McClellan, AMI, Mullen[,] and Jescavage. Tegman also sued Noble. Their complaints sought damages on various theories. The cases were consolidated. In the interim, McClellan pleaded guilty to mail fraud in United States District Court in 1997 and was sentenced to two years imprisonment. Also, this court affirmed a judgment by the same trial court in another case where McClellan settled a client's case without authorization and stole the proceeds. That judgment apportioned 20-percent fault to attorney James Bailey who, like Noble and Jescavage, had associated himself with AMI and failed to warn his clients of McClellan's improprieties.
In the present matter, the court entered summary judgment against McClellan and AMI on the issue of liability. After a six-day trial, the court held Mullen, Noble, and Jescavage liable for negligence and legal negligence, and awarded damages. Only Mullen and Noble appeal[ed]. Their appeals have been consolidated.
PARALEGAL NEGLIGENCE
Mullen, a paralegal, contends the court erred in finding her negligent. To establish the elements of an action for negligence, a plaintiff must show: (1) the existence of a duty owed, (2) breach of that duty, (3) a resulting injury, and (4) a proximate cause between the breach and the injury.
Non-attorneys who attempt to practice law will be held to the same standards of competence demanded of attorneys and will be liable for negligence if these standards are not met. The "practice of law" clearly does not just mean appearing in court. In a larger sense, it includes "legal advice and counsel, and the preparation of legal instruments and contracts by which legal rights are secured."
Mullen contends that her status as a paralegal precludes a finding that she was engaged in the practice of law. She argues that a paralegal is, by definition, someone who works under the supervision of an attorney, and that it is necessarily the attorney, not the paralegal, who is practicing law and owes a duty to the clients. Her argument assumes that she had a supervising attorney. The trial court's determination that Mullen was negligent was dependent on the court's finding that Mullen knew, or should have known, that she did not have a supervising attorney over a period of several months while she was at AMI. "Had Mullen been properly supervised by an attorney at all times during her employment with AMI, plaintiffs presumably would have no case against her. Rather, her supervising attorney would be responsible for any alleged wrongdoing on her part."
We agree with the trial court's observation. The label "paralegal" is not in itself a shield from liability. A factual evaluation is necessary to distinguish a paralegal who is working under an attorney's supervision from one who is actually practicing law. A finding that a paralegal is practicing law will not be supported merely by evidence of infrequent contact with the supervising attorney. As long as the paralegal does in fact have a supervising attorney who is responsible for the case, any deficiency in the quality of the supervision or in the quality of the paralegal's work goes to the attorney's negligence, not the paralegal's. In this case, Mullen testified that she believed James Bailey was her supervising attorney after Jescavage left. The court found Mullen was not justified in that belief. Mullen assigns error to this finding, but the evidence supports it. Mullen testified that she had started to distrust McClellan before he informed her that Bailey would be her supervising attorney. Mullen also testified that she did not contact Bailey to confirm that he was supervising her. Bailey testified at a deposition that he did not share Mullen's clients and she did not consult him regarding any of her ongoing cases. He also said that one of the only conversations he remembers having with Mullen with respect to AMI is one where he told her that he was not her supervising attorney after she raised the issue with him. This testimony amply supports the trial court's finding that Mullen was unjustified in her belief that Bailey was her supervising attorney.
"It is the nature and character of the service performed which governs whether given activities constitute the practice of law, not the nature or status of the person performing the services". Hunt, 75 Wash. App. at 802, 880 P.2d 96. Mullen's status as a paralegal did not preclude the trial court from concluding that Mullen had engaged in the practice of law.
Contrary to Mullen's argument, such a conclusion does not require evidence that the paralegal called herself an attorney, entered appearances, or charged fees. Mullen testified that she negotiated settlements on behalf of the plaintiffs. She sent a letter rejecting, without Tegman's knowledge, a settlement offer made to Tegman. She continued to send out demand and representation letters after Jescavage left AMI. Letters written by Mullen before Jescavage's departure identify Mullen as a paralegal after her signature, whereas letters she wrote after Jescavage's departure lacked such identification. Even after Mullen discovered, in late November 1991, that Bailey was not her supervising attorney, she wrote letters identifying "this office" as representing the plaintiffs, neglecting to mention that she was a paralegal and that no attorney was responsible for the case. This evidence substantially supports the finding that Mullen engaged in the practice of law.
Mullen, because she is not an attorney, could not have attorney-
client relationships. Nevertheless, as Bowers demonstrates, a layperson can logically be held to the standard of care of an attorney in a negligence action. The duty arises from the attempt to engage in the practice of law rather than from the professional status of the defendant. The trial court, covering all bases, held Mullen liable both for negligence and legal negligence. While the "legal negligence" label may have been incorrect, any such error is immaterial because the negligence theory produces the same result and, as the trial court observed, for practical purposes the allegations are the same.
Accordingly, we conclude the trial court did not err in following Bowers and holding Mullen to the duty of an attorney. The duty of care owed by an attorney is that degree of care, skill, diligence, and knowledge commonly possessed and exercised by a reasonable, careful, and prudent lawyer in the practice of law in Washington.
Mullen challenges, as unsupported by the evidence, the trial court's key finding as to the duties that Mullen owed and breached. The court found that the standard of care owed by an attorney, and therefore also by Mullen, required her to notify the plaintiffs of: (1) the serious problems concerning the accessibility of their files to persons who had no right to see them, (2) the fact that client settlements were not processed through an attorney's trust account, but rather McClellan's own account, (3) the fact that McClellan and AMI, as non-lawyers, had no right to enter into contingent fee agreements with clients and receive contingent fees, (4) the fact that McClellan was, in fact, engaged in the unlawful practice of law, and that, generally, (5) the clients of McClellan and AMI were at substantial risk of financial harm as a result of their association with AMI. Mullen breached her duty to her clients in all of these particulars.
Although Mullen was a paralegal, she is held to an attorney's standard of care because she worked on the plaintiffs' cases during a period of several months when she had no supervising attorney. The fact that she did not render legal advice directly does not excuse her; in fact, her failure to advise the plaintiffs of the improper arrangements at AMI is the very omission that breached her duty. Under these circumstances it is not unjust to hold her accountable as a legal cause of the plaintiffs' injuries. As all the elements of negligence have been established, we affirm the judgment against Mullen. The judgments are affirmed.
According to the court, what standard is used for paralegals who attempt to practice law?