Michael C. Ryan and Ryan Data Exchange, LTD. d/b/a Rydex, LTD. v. Simmons Perrine Moyer Bergman, PLC

IN THE COURT OF APPEALS OF IOWA

No. 17-1281
Filed June 20, 2018

MICHAEL C. RYAN and RYAN DATA EXCHANGE, LTD. d/b/a RYDEX, LTD.,
Plaintiffs-Appellants,

vs.

SIMMONS PERRINE MOYER BERGMAN, PLC,
Defendant-Appellee.
________________________________________________________________

Appeal from the Iowa District Court for Polk County, David N. May, Judge.

Plaintiffs-Appellants challenge the partial summary judgment on their claim

of negligence. AFFIRMED.

Kenneth R. Munro of Munro Law Office, P.C., Des Moines, for appellant.

Robert V.P. Waterman Jr. and Joshua J. McIntyre of Lane & Waterman

LLP, Davenport, for appellee.

Considered by Vogel, P.J., and Doyle and Bower, JJ.
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VOGEL, Presiding Judge.

Michael C. Ryan and his business Ryan Data Exchange, Ltd. (collectively,

“Ryan”) appeal the district court’s grant of partial summary judgment, which

entered judgment on two paragraphs of their petition alleging negligence against

Simmons Perrine Moyer Bergman, PLC (Simmons). Ryan argues the district court

erred in finding Simmons cannot be a proximate cause of Ryan’s loss. We agree

with the district court that Simmons’s withdrawal as counsel left sufficient time for

successor counsel to file a breach-of-contract claim and affirmative defenses, had

such been deemed warranted by successor counsel. Therefore, we affirm the

partial summary judgment.

On June 8, 2011, Ryan executed a retainer agreement with attorney Jeffrey

McGinness1 of Simmons for potential litigation against Christopher Risewick and

his businesses (collectively, “Risewick”). On August 8, Simmons filed suit on

Ryan’s behalf against Risewick, alleging breach of fiduciary duty, interference with

existing and prospective business, negligent misrepresentation, and fraudulent

misrepresentation (the Risewick litigation). In response, Risewick filed a

counterclaim against Ryan seeking payment for contractual debts. The scheduling

order closed the pleadings on November 29, 2012. On July 12, 2012, Risewick

moved for summary judgment on Ryan’s claims and their counterclaim. On July

27, Simmons moved for leave to withdraw as Ryan’s counsel in the Risewick

litigation. On August 8, the court granted Simmons leave to withdraw. On August

1
McGinness’s license was later suspended for falsifying certificates of service attached to
discovery requests during the Risewick litigation. See Iowa Supreme Ct. Att’y Disciplinary
Bd. v. McGinness, 844 N.W.2d 456 (Iowa 2014).
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30, Ed Skinner and R. Bradley (Brad) Skinner of Skinner Law Office (collectively,

“Skinner”) entered an appearance on behalf of Ryan. Skinner never filed a

resistance to the motion for summary judgment. On October 16, Skinner filed, and

the court accepted, a joint consent to judgment, in which Ryan dismissed his

claims with prejudice, agreed to adverse judgment on the counterclaim, and

agreed to pay fees and costs.

On August 12, 2014, Ryan filed the petition for the proceeding at issue. The

petition claims Simmons committed negligence, fraud, and breach of contract in

representing Ryan during the Risewick litigation. Regarding negligence, the

petition claims Simmons breached the standard of care with several of its actions,

including:

8(g) In failing to amend the Petition to include a breach of contract
claim and any other claims which were still viable.
....
8(i) In failing to plead proper affirmative defenses to the counterclaim
filed by the Defendants in the underlying case.

On December 14, 2014, Simmons initially filed for summary judgment on all

counts. Regarding paragraphs 8(g) and (i), Simmons argued Ryan had sufficient

time and ability to proceed through Skinner, which severed any causation

Simmons had for Ryan’s alleged harm. On February 16, 2015, the district court

denied summary judgment. Regarding the negligence claim, the court noted

issues of causation are ordinarily for the jury to decide. The court noted “the

possible effect of McGinness’ malfeasance on Ryan’s options when [Simmons]

chose to withdraw,” and it refused to find Simmons left enough time for Skinner to

respond to the lawsuit as a matter of law.
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On March 4, 2016, the parties deposed attorney Brad Skinner about

Skinner’s role in the Risewick litigation.2 Brad testified Ed Skinner performed the

majority of the firm’s work on the case, with the two of them splitting the work 70/30

or 80/20. According to Brad, they recommended Ryan enter into the consent to

judgment with Risewick to create “the softest landing” possible because Ryan’s

claims were likely time-barred and the counterclaim was strong. Brad also testified

about the time constraints they faced when they took over the case from Simmons:

Q. Was lack of time for you to fully evaluate the case ever a
factor in your decision to advise [Ryan] to settle and agree to the
consent judgment? A. Not the lack of our time to work with things,
our lack of time with what was going on with the Court system and
the pressures that were out there on them and the fact that opposing
counsel was not cooperating.
Q. Do you believe that if you had had more time and opposing
counsel had been more cooperative, that you would have or could
have advised Mr. Ryan differently? A. No.
Q. Why not? A. I don’t think he had a case.
Q. You believe that you reviewed all the documents
necessary for you to arrive at a decision that he didn’t have a case?
A. I believe that, but I also trust [Ed Skinner] in what he was—if there
would have been a case, we would have pursued—we would have
done different things to pursue it. . . . I know [Ed] and I had these
conversations that we would have never pursued the case in the first
place. I think I’ve discussed that, but we just—with the statute of
limitation issues in place.
Q. And all I’m trying to do—and I think you’ve answered it—
is confirm that you had reviewed all the information you felt was
necessary to conclude that he didn’t have an underlying case? A. I
think we reviewed too much information on it.
Q. And that was your ultimate decision and advice to him, he
didn’t have an underlying case against Risewick and the others;
correct? A. Not only that, but [Risewick] had a hell of a case on the
[counterclaim].

On April 7, 2016, Simmons filed for partial summary judgment on

paragraphs 8(g) and (i) of the petition. On June 30, the court determined summary

2
Ryan notes in his reply brief Ed Skinner is now deceased.
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judgment was appropriate if Skinner had “sufficient time” to file the breach-of-

contract claim and affirmative defenses. The court found Skinner began its

representation no later than its appearance on August 30, 2012, and Skinner could

have filed the claim and defenses until November 29 when the pleadings closed.

The court also found the Skinner deposition showed it believed it had enough

opportunity to evaluate the case and Ryan had shown no evidence that additional

time would have led Skinner to amend the pleadings. Therefore, the court

concluded Skinner had sufficient time to amend the pleadings, and it granted

summary judgment on paragraphs 8(g) and (i) of the petition.

On May 18, 2017, Ryan filed a motion for partial summary judgment,

essentially asking the court to set aside its June 30, 2016 order and reinstate its

February 16, 2015 order. On June 20, 2017, the district court denied Ryan’s

motion for the reasons stated in the June 30, 2016 order. Ryan now appeals.

We review grants of summary judgment for correction of
errors at law. “Summary judgment is appropriate when there is no
genuine issue of material fact and the moving party is entitled to
judgment as a matter of law.” We view the facts in the light most
favorable to the nonmoving party.
A party seeking to establish a prima facie claim of legal
malpractice must show the following: (1) a duty arising from the
established existence of an attorney-client relationship; (2) the
attorney breached that duty; (3) the attorney’s breach was the
proximate cause of injury to the client; and (4) the client suffered
actual damage, injury, or loss.

Barker v. Capotosto, 875 N.W.2d 157, 161 (Iowa 2016) (citations omitted). Ryan

argues the district court erred in finding Simmons did not proximately cause his

injury as a matter of law.

Our supreme court has acknowledged the rule that “[a]n attorney cannot be

held liable for failing to file an action prior to the expiration of the statute of
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limitations if he ceased to represent the client and was replaced by other counsel

before the statute ran on the client’s action.” Ruden v. Jenk, 543 N.W.2d 605, 612

(Iowa 1996) (quoting Steketee v. Lintz, Williams & Rothberg, 694 P.2d 1153, 1159

(Cal. 1985)). Other courts have further explained the effect of successor counsel

in legal malpractice claims. See Norton v. Sperling Law Office, P.C., 437 F. Supp.

2d 398, 402–03 (D. Md. 2006). The actions of successor counsel may create “an

intervening cause that breaks the chain of causation arising from the prior

attorney’s negligence.” Id. at 402. In order to rely on this rule, the prior attorney

must show “a sufficiently long time gap between the severing of the attorney–client

relationship and the lapse of the statute of limitations.” Id. at 403. “Courts have

not set a minimum baseline for what constitutes ‘sufficient time,’ although one court

has deemed as little as thirty days sufficient.” Id. (citing Sherotov v. Capoccia, 555

N.Y.S.2d 918 (App. Div. 1990)); but see id. at 403 (finding ten weeks was not

sufficient time for successor counsel to bring a personal injury case where the

proper forum was not clear); Villarreal v. Cooper, 673 S.W.2d 631 (Tex. App. 1984)

(finding seventy-seven days was not sufficient time for successor counsel to bring

a tort case when prior counsel had the case for sixteen months and evidence and

witnesses could no longer be located).

In the instant case, the parties disagree about exactly how much time the

successor counsel had to file the breach-of-contract claim and affirmative

defenses. At the latest, the time to respond began when Skinner entered its

appearance on August 30, 2012. As the district court found, Skinner’s deadline to

file the claim and defenses was no earlier than November 29, 2012, when the

pleadings closed. See Iowa R. Civ. P. 1.402(5) (“Whenever the claim or defense
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asserted in the amended pleading arose out of the conduct, transaction, or

occurrence set forth or attempted to be set forth in the original pleading, the

amendment relates back to the date of the original pleading.”). While Ryan notes

they faced earlier court-imposed deadlines for discovery and other issues, they

could have sought continuances if needed. See Iowa R. Civ. P. 1.911(1) (“A

continuance may be allowed for any cause not growing out of the fault or

negligence of the movant, which satisfies the court that substantial justice will be

more nearly obtained.”). Thus, Skinner had at least thirteen weeks between its

appearance on August 30 and the close of pleadings on November 29 to file any

additional claims and defenses.

Brad Skinner’s deposition shows Skinner was not concerned with the time

constraints for adding a breach-of-contract claim and contractual debt defenses on

Risewisk’s counterclaim. The undisputed facts show Skinner recommended Ryan

settle the suit more than one month before pleadings closed rather than pursue

additional issues. Ryan argues Brad’s statements are “self-serving,” as Brad

would likely not admit Skinner recommended settlement without taking the time to

fully evaluate the case. Ryan also notes Brad had a limited role, as Brad only

performed 20% to 30% of the firm’s work on the Risewick litigation. However, as

Ryan acknowledges, Brad’s testimony is “undoubtedly genuine.” Brad is an

attorney bound by professional obligations. He testified without reservation, “I

don’t think [Ryan] had a case.” By doing so, he showed enough familiarity with the

matter to offer a conclusive opinion, and he exposed Skinner to liability if his

assessment was incorrect. Therefore, based on the Skinner deposition and all

other evidence in the record, thirteen weeks was sufficient time for a successor
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counsel to file the breach-of-contract claim and affirmative defenses. See Ruden,

543 N.W.2d at 612.

Nevertheless, Ryan asserts Simmons committed several other acts of

misconduct or negligence. Ryan also asserts that, viewing the facts in the most

favorable light, the Skinner deposition cannot establish Ryan lacked valid breach-

of-contract claims and affirmative defenses. However, Ryan does not explain how

these issues affected successor counsel’s ability to file the breach-of-contract

claim and affirmative defenses. Furthermore, such issues are outside the scope

of this decision. This decision only finds Simmons’s withdrawal left sufficient time

for successor counsel to file the breach-of-contract claim and affirmative defenses

under paragraphs 8(g) and (i) of the petition should such have been warranted.

This decision does not affect Ryan’s other claims against Simmons or any other

person.

AFFIRMED.