October 20, 2014 – Foland Lucero and R & L Straightline Tile, LLC a/k/a R 7 L Straightline Tile v. Richard Sutten, No. 32,901

IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
Opinion Number: _______________
Filing Date: October 20, 2014
NO. 32,901
ROLAND LUCERO and R & L
STRAIGHTLINE TILE, LLC a/k/a
R & L STRAIGHTLINE TILE,
Plaintiffs-Appellants,
v.
RICHARD SUTTEN,
Defendant-Appellee.
APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY
Alan M. Malott, District Judge
Law Offices of Daymon B. Ely
Daymon B. Ely
Albuquerque, NM
William Gilstrap
Albuquerque, NM
for Appellants
Tucker Law Firm, P.C.
Steven L. Tucker
Santa Fe, NM
for Appellee

OPINION
VANZI, Judge.
{1} 	The Memorandum Opinion filed in this case on September 29, 2014, is hereby
withdrawn, and this Opinion is substituted in its place.
{2} 	Roland Lucero and his company, R & L Straightline Tile, (collectively,
Plaintiff) appeal from a judgment entered in favor of Defendant Richard Sutten
following a bench trial on the issue of legal malpractice. The district court found that
Defendant negligently failed to apprise Plaintiff of the dangers of providing an
unsecured $300,000 loan to a Las Vegas development company. However, the district
court applied the doctrine of independent intervening cause, a defense that had not
been previously raised in Defendant’s proposed findings prior to trial, and concluded
that the real estate market collapse of the mid-to-late 2000s severed the connection
between Defendant’s professional negligence and Plaintiff’s damages claimed
therefrom. On appeal, Plaintiff argues that the district court erred in applying the
doctrine of independent intervening cause to these facts. We agree. We reverse and
remand for consideration of damages in light of this Opinion.
BACKGROUND
{3} 	The district court’s following findings of fact in this case are not challenged on
appeal. Plaintiff was able to amass substantial savings in the course of his business in

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the tile industry. In February 2008, Plaintiff was approached by Mark Brady, an old
friend, about loaning $300,000 to a developer for a mixed-use real estate development
project in Las Vegas, Nevada. By the terms of the proposed “bridge loan,” Plaintiff
was to receive a $360,000 payment one month after making the loan. Brady, who was
also the friend of an officer of the development company, stood to receive a “finder’s
fee” of up to $30,000 for assisting in the transaction. These terms were contained in
a document entitled “Secured Promissory Note,” (the Note) which was forwarded to
Brady by the developer.
{4} 	Brady suggested to Plaintiff that Defendant, a licensed attorney, review the
document on Plaintiff’s behalf. Defendant reviewed and made minor changes to the
document without notifying Plaintiff that the purported the Note did not, in fact, create
any security interest. Nor did Defendant apprise Plaintiff of any of the inherent risks
involved in engaging in such a transaction. Instead, Defendant returned the Note with
his edits to Brady but did not communicate directly with Plaintiff. Shortly after
making the loan, the real estate market in Las Vegas, Nevada, suffered a “cataclysmic
decline,” and the Las Vegas developer filed for bankruptcy. Plaintiff was never repaid
any portion of the loan he had made because the senior lienholder’s interests exceeded
the value of the secured property after the market collapse.
{5} 	Plaintiff sued Defendant for professional malpractice, and the district court held
a bench trial on the merits. The district court found that the parties had entered into

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an attorney-client relationship and that Defendant’s actions fell below the standard of
care and were negligent because he failed to adequately review the Note or advise
Plaintiff about the nature and dangers of the proposed transaction. Nevertheless, the
district court found that the decline in the Las Vegas real estate market operated as an
independent 	intervening 	cause, 	severing 	the 	connection 	between 	Defendant’s
professional negligence and Plaintiff’s losses. This appeal followed.
DISCUSSION
Standard of Review
{6} 	At the outset, the parties disagree about the standard of review we should apply
in this case. Plaintiff contends that this matter should be reviewed de novo, while
Defendant argues that Plaintiff “gets off on the wrong foot with the standard of
review” and that we should instead determine whether the factual issues are supported
by substantial evidence. We agree with Plaintiff. While the determination of whether
something is an independent intervening cause is a question of fact, Govich v. North
American Systems, Inc., 1991-NMSC-061, ¶ 24, 112 N.M. 226, 814 P.2d 94, this
appeal, involving undisputed facts, presents a question of law: whether the doctrine
of independent intervening cause should have even been considered by the fact finder
in the first place. We have previously reviewed this issue de novo in cases tried by
juries, see, e.g., Chamberland v. Roswell Osteopathic Clinic, Inc., 2001-NMCA-045,
¶ 11, 130 N.M. 532, 27 P.3d 1019, and we see no reason to afford a more deferential

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review when the fact finding is conducted by a judge. Johnson v. Yates Petroleum
Corp., 1999-NMCA-066, ¶ 3, 127 N.M. 355, 981 P.2d 288 (stating that when the
relevant facts are undisputed, the legal interpretation of those facts is reviewed de
novo on appeal). We therefore review the district court’s decision to apply the
doctrine of independent intervening cause de novo.
The Doctrine of Independent Intervening Cause Should Not Have Been
Considered by the Fact Finder
{7} 	Plaintiff makes two arguments on appeal: (1) that the district court incorrectly
applied the doctrine of independent intervening cause and (2) that the district court’s
decision creates immunity for a person or entities whose negligence caused harm.
Because our reversal is based on the issue of the independent intervening cause, we
need not reach Plaintiff’s second argument. Before turning to our analysis, however,
we note again one curious aspect of the district court’s decision. Our review of the
record indicates that Defendant did not raise the doctrine of independent intervening
cause in his pre-trial findings and conclusions or during the trial, including during
closing argument. It was only after the district court raised the doctrine sua sponte in
his letter decision that Defendant added to his post-trial findings and conclusions that
the “market collapse was an independent intervening force” that severed the
connection between Defendant’s negligence and Plaintiff’s losses. Accordingly, the
doctrine, which then became part of the district court’s findings and conclusions, was

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never properly raised by Defendant or argued by the parties below. See Chamberland,
2001-NMCA-045, ¶ 25 (noting that it was the defendant’s duty to request an
instruction and present the issue of independent intervening cause to the jury).
Notwithstanding the lack of a fully developed record on the issue, we proceed to
address the district court’s ruling.
{8} 	“The elements of legal malpractice are: (1) the employment of the defendant
attorney; (2) the defendant attorney’s neglect of a reasonable duty; and (3) the
negligence resulted in and was the proximate cause of loss to the client.” Encinias v.
Whitener Law Firm, P.A., 2013-NMSC-045, ¶ 8, 310 P.3d 611 (alteration, internal
quotation marks, and citation omitted). At trial, the district court found that the first
two elements of representation and negligence were met, but it concluded that the
collapse of the real estate market in Las Vegas, Nevada, constituted an independent
intervening cause, severing Defendant’s negligence from Plaintiff’s losses. As a result,
the sole issue before this Court is the third element, proximate cause. See Torres v. El
Paso Elec. Co., 1999-NMSC-029, ¶ 17, 127 N.M. 729, 987 P.2d 386 (“A finding of
an independent intervening cause represents a finding against the plaintiff on
proximate cause[.]”), overruled on other grounds by Herrera v. Quality Pontiac,
2013-NMSC-018, 134 N.M. 43, 73 P.3d 181.
{9} 	“An independent intervening cause is a cause which interrupts the natural
sequence of events, turns aside their cause, prevents the natural and probable results

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of the original act or omission, and produces a different result, that could not have
been reasonably foreseen.” Id. ¶ 12 (internal quotation marks and citation omitted).
In Torres, our Supreme Court recognized that the doctrine is incompatible with our
system of comparative negligence and potentially in conflict with our use of several
liability. See id. ¶¶ 18-19. Thus, our appellate courts have “virtually eliminated” the
doctrine’s application in cases involving only negligent, as opposed to intentional,
conduct. Silva v. Lovelace Health Sys., Inc., 2014-NMCA-086, ¶ 14, 331 P.3d 958,
cert. granted, 2014-NMCERT-008, 334 P.3d 425. While the defense may still be
available in limited cases, for example where the alleged intervening cause is a “force
of nature”—the sort of event that “cannot be prevented by human care, skill or
foresight”—Chamberland, 2001-NMCA-045, ¶ 24 (internal quotation marks and
citation omitted), for the reasons discussed below, we find it unnecessary to decide
whether “market decline” constitutes a force of nature in this case.
{10} 	When the intervening cause does not involve intentional conduct, New Mexico
follows the rule that “any harm which is in itself foreseeable, as to which the actor has
created or increased the recognizable risk, is always proximate, no matter how it is
brought about.” Andrews v. Saylor, 2003-NMCA-132, ¶ 22, 134 N.M. 545, 80 P.3d
482 (alteration, internal quotation marks, and citation omitted). Thus, the doctrine is
inapplicable in New Mexico in cases where a non-intentional intervening force causes
the same harm as that risked by the actor’s conduct. See Collins ex rel. Collins v.

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Perrine, 1989-NMCA-046, ¶ 19, 108 N.M. 714, 778 P.2d 912 (“An independent
intervening cause is a cause that interrupts the natural sequence of events and
produces a different result that could not be reasonably foreseen.”). The principle cited
in Andrews, Torres, and Collins is adopted from the Restatement (Second) of Torts,
which applies equally to forces of nature:
If the actor’s conduct has created or increased the risk that a particular
harm to the plaintiff will occur, . . . it is immaterial to the actor’s liability
that the harm is brought about in a manner which no one in his position
could possibly have been expected to foresee or anticipate. This is true
not only where the result is produced by the direct operation of the
actor’s conduct upon conditions or circumstances existing at the time,
but also where it is brought about through the intervention of other
forces which the actor could not have expected, whether they be forces
of nature, or the actions of animals, or those of third persons which are
not intentionally tortious or criminal.
Section 442B cmt. b (1965) (emphasis added).
{11} 	Our application of Restatement (Second) of Torts Section 442B to an allegedly
intervening force in the legal malpractice context of Collins is instructive. In Collins,
the defendant-attorney negligently settled a complex medical malpractice case without
performing a minimum level of discovery. 1989-NMCA-046, ¶ 13. After settling with
the original defendants, the plaintiffs sued Indian Health Services (IHS) in federal
court and obtained a much larger judgment, with damages apportioned between IHS
and the original defendants. Id. ¶ 8. Despite the previous settlement with the original
defendants, the plaintiffs’ attorney planned on collecting all damages from IHS

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through principles of joint and several liability. Id. ¶ 16. However, while the second
suit was pending, New Mexico abolished the concept of joint and several liability. Id.
¶ 17. Thus, as a result of the attorney’s negligence in settling the original case,
together with the change in state tort law, the plaintiffs were unable to collect a
substantial portion of the damages awarded in the federal judgment. Id. ¶ 8.
{12} 	At trial for legal malpractice and on appeal, the defendant-attorney in Collins
argued that the unforeseeable change in the law acted as an independent intervening
cause. Id. ¶¶ 16-18. This Court rejected that argument, stating:
The Restatement of Torts addresses this point clearly. In Section 442B,
the Restatement explains that where the negligent conduct of an actor
creates or increases the risk of a particular harm and is a substantial
factor in causing that harm, the fact that the harm is brought about
through the intervention of another force does not relieve the actor of
liability.
Collins, 1989-NMCA-046, ¶ 20. Applying Restatement (Second) of Torts Section
442B, we reasoned that the attorney’s negligence created a particular risk—the risk
that the plaintiffs would not be able to recover damages caused by the original
defendants. We therefore held that the “intervention of the change in law,” whether
foreseeable or not, brought about a foreseeable harm and could not relieve the attorney
of liability. Collins, 1989-NMCA-046, ¶¶ 20-21.
{13} 	In light of these authorities, the district court should not have considered the
doctrine of independent intervening cause in this case. The district court found that

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Defendant gave the transaction the attorney “seal of approval,” negligently creating
or increasing the risk of the loss of Plaintiff’s investment by failing to warn Plaintiff
of the dangers inherent in loaning $300,000 to a Las Vegas developer in an unsecured
transaction. In the absence of any allegation that the intervening cause was the result
of intentional tortious conduct, the principles articulated in Restatement (Second) of
Torts Section 442B and adopted in Collins apply. As discussed above, these principles
apply whether or not the market decline is considered a “force of nature.” The district
court should not have dismissed this case but, instead, it should have determined
whether Defendant’s negligence was the proximate cause of Plaintiff’s loss and, if
applicable, employed a standard comparative fault analysis.
{14} 	Citing to several out-of-state and federal cases, Defendant asks us to consider
whether the collapse of the Las Vegas real estate market was foreseeable. However,
Defendant’s characterization of the issue relies on the same contention that we
specifically rejected in Collins: that the manner in which the harm occurs is somehow
relevant to the analysis. See Collins, 1989-NMCA-046, ¶¶ 17-21. We have made clear
that in cases not involving intentional intervening conduct, when the risk of harm is
foreseeable, the manner that the foreseeable harm is brought about need not itself be
foreseeable. Id. ¶ 21 (“Nor does it matter whether [the attorney] could have foreseen
the change in law.”). Accordingly, we find Defendant’s citations to extra-jurisdictional
opinions evaluating the foreseeability of the 2008 real estate market collapse

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inapposite. We conclude that the district court erred in applying the doctrine of
independent intervening cause to its factual determination that the parties had entered
into an attorney-client relationship and that Plaintiff made the loan in reliance, at least
partially, on Defendant’s seal of approval.
CONCLUSION
{15} 	We reverse the district court’s decision dismissing Plaintiff’s complaint with
prejudice and remand for consideration and apportionment of damages using a
comparative fault analysis.
{16} 	IT IS SO ORDERED.
__________________________________
LINDA M. VANZI, Judge
WE CONCUR:
_________________________________
MICHAEL D. BUSTAMANTE, Judge
_________________________________
J. MILES HANISEE, Judge