Moore v. Jordan , 259 N.C. App. 590 ( 2018 )

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA17-577
Filed: 15 May 2018
Orange County, No. 15 CVS 668
CAROL D. MOORE, Plaintiff
v.
WILLIAM W. JORDAN and HILL EVANS JORDAN & BEATTY, A Professional
Limited Liability Company, Defendants
Appeal by plaintiff from order entered 7 February 2017 by Judge James K.
Roberson in Orange County Superior Court. Heard in the Court of Appeals 29
November 2017.
Randolph M. James, P.C., by Randolph M. James, for plaintiff-appellant.
Sharpless & Stavola, P.A., by Frederick K. Sharpless, for defendant-appellees.
CALABRIA, Judge.
Carol D. Moore (“plaintiff”) appeals from the trial court’s order granting
defendants’ motion for summary judgment on plaintiff’s claim for legal malpractice.
After careful review, we conclude that plaintiff failed to forecast any evidence to prove
that, but for defendants’ alleged negligence, plaintiff would have received a more
favorable judgment in her prior equitable distribution action. Accordingly, we affirm
the trial court’s order.
I. Background
MOORE V. JORDAN
Opinion of the Court
Plaintiff and James B. Moore, III (“Dr. Moore”) were married on 22 September
1984 and separated on 29 March 2009. On 23 July 2009, plaintiff filed Moore v.
Moore, 09 CVD 1183, in Orange County District Court seeking, inter alia, spousal
support and an equitable distribution of marital property. On 21 June 2010, plaintiff
retained William W. Jordan (“Jordan”) and Hill Evans Jordan & Beatty, PLLC,
(collectively, “defendants”) to represent her in the pending action. Plaintiff hired
defendants due to their experience tracing marital assets in complex equitable
distribution proceedings. Defendants were aware that plaintiff believed that Dr.
Moore had hidden assets in anticipation of the parties’ divorce. In addition to
defendants, plaintiff also retained certified public accountant Heather Linton and
certified fraud examiner Carl Allen (“Allen”) to help locate the alleged missing assets.
During discovery, defendants conducted depositions; subpoenaed financial
institutions; and reviewed tax returns and other documents for evidence of
undisclosed earnings or accounts, including potential off-shore transactions.
However, neither defendants nor plaintiff’s experts ever located any undisclosed
assets. Jordan ultimately concluded that the Moores’ once-substantial marital estate
had been depleted as a result of market factors and the parties’ extravagant lifestyle
choices. Although Allen had “theories” that Dr. Moore might have mismanaged
marital funds, Jordan determined that the evidence was speculative,
unsubstantiated, and likely inadmissible. Therefore, when the trial commenced on 3
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Opinion of the Court
January 2011, Jordan notified Allen that he would not call him to testify. At trial,
defendants did not present any expert witness evidence to support plaintiff’s theory
that Dr. Moore hid marital assets prior to the parties’ divorce.
On 20 June 2012, the trial court entered an Equitable Distribution Judgment
and Alimony Order awarding plaintiff alimony and an unequal distribution of the
parties’ net, non-retirement marital and divisible estate. The trial court found, in
relevant part, that:
26. Plaintiff believed that [Dr. Moore] was moving and
hiding the parties’ money. The Court finds Plaintiff’s belief
to be unfounded.
...
40. The parties lived well above their means during their
marriage. The parties frequently incurred charges on their
credit cards of $12,000 - $15,000 per month. They hired
private tennis coaches for the children. Their children
attended private and/or out-of-state schools. The parties
used savings and investment accounts during the latter
part of their marriage to meet their lifestyle expenses; in
so doing and with the help of negative market forces, the
parties dwindled their non-retirement cash and
investment accounts from approximately $3,000,000 to
under $200,000 by the time the parties separated.
...
83. Plaintiff’s claim for attorney’s fees should be denied. . .
. The parties’ respective estates, after the entry of this
Judgment, shall be substantially similar. Many fees were
incurred by the parties due to Plaintiff’s unfounded
suspicion that [Dr. Moore] was hiding money, and the
Court cannot find any statutory basis and justification to
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MOORE V. JORDAN
Opinion of the Court
support an award of attorney’s fees from [Dr. Moore] to
Plaintiff.
Plaintiff did not appeal the Equitable Distribution Judgment and Alimony
Order. However, on 18 June 2015, plaintiff filed a complaint against defendants in
Orange County Superior Court, alleging legal malpractice in their representation of
plaintiff’s equitable distribution action. Following some discovery, on 14 October
2016, defendants filed a motion for summary judgment. On 7 February 2017, the
trial court entered an order granting defendants’ motion for summary judgment.
Plaintiff appeals.
II. Analysis
On appeal, plaintiff argues that defendants’ failure to present certain evidence
to the district court proximately caused her to receive a less-favorable judgment at
equitable distribution. We disagree.
As an initial matter, since this is a legal malpractice action, “the plaintiff has
the burden of proving by the greater weight of the evidence: (1) that the attorney
breached the duties owed to his client, . . . and that this negligence (2) proximately
caused (3) damage to the plaintiff.” Rorrer v. Cooke, 313 N.C. 338, 355, 329 S.E.2d
355, 366 (1985) (internal citation omitted). “In a negligence action, summary
judgment for defendant is proper where the evidence fails to establish negligence on
the part of defendant, establishes contributory negligence on the part of plaintiff, or
establishes that the alleged negligent conduct was not the proximate cause of the
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MOORE V. JORDAN
Opinion of the Court
injury.” Id. (citation and quotation marks omitted). We review the trial court’s
summary judgment order de novo. In re Will of Jones, 362 N.C. 569, 573, 669 S.E.2d
572, 576 (2008).
A legal malpractice action is considered “a case within a case.” Young v. Gum,
185 N.C. App. 642, 647, 649 S.E.2d 469, 473 (2007), disc. review denied, 362 N.C. 374,
662 S.E.2d 552 (2008). In order to hold an attorney liable for harm arising from the
attorney’s negligence in another action, the plaintiff must establish causation by
proving that “(1) the original claim was valid; (2) the claim would have resulted in a
judgment in the plaintiff’s favor; and (3) the judgment would have been collectible.”
Id. at 646, 649 S.E.2d at 473 (citation and quotation marks omitted). We look to the
substantive law defining the plaintiff’s underlying claim in order to determine which
facts the plaintiff must forecast to support the legal malpractice claim. Id. at 647,
649 S.E.2d at 473-74.
In an equitable distribution action,
the burden of proof is upon the party claiming that
property is marital property to show by a preponderance of
the evidence that the property: (1) was acquired by either
spouse or both spouses; (2) during the marriage; (3) before
the date of the separation of the parties; and (4) is presently
owned.
Id. at 647, 649 S.E.2d at 474 (citation and quotation marks omitted). “The party
claiming that property is marital property must also provide evidence by which that
property is to be valued by the trial court.” Id. at 647-48, 649 S.E.2d at 474.
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Opinion of the Court
Accordingly, in order to succeed on her legal malpractice claim against defendants,
“plaintiff was required to forecast evidence that would be sufficient to demonstrate
not only that defendants were negligent in advising her, but also evidence which
would support plaintiff’s underlying equitable distribution claim and her allegation
that an equitable distribution judgment in her favor would have exceeded” the
amount she actually received. Id. at 648-49, 649 S.E.2d at 474.
On appeal, plaintiff asserts that there are several assets that would have been
classified as marital property, but for defendants’ failure to present expert financial
evidence at equitable distribution. For example, plaintiff contends that a projected
income spreadsheet prepared by the Moores’ financial planner, Kyle Elliott, along
with Elliott’s deposition testimony, establishes that on 1 December 2008, “the Moores
owned a 20% interest in a Texas business valued at 1.8 million dollars.”
Assuming, arguendo, that this bare assertion and evidence would suffice at
equitable distribution, plaintiff’s belief that the Moores’ business interest would be
classified as marital property might be correct, because the spreadsheet was drafted
118 days prior to the parties’ separation. See generally N.C. Gen. Stat. § 50-20 (2017)
(“Distribution by court of marital and divisible property.”). However, N.C. Gen. Stat.
§ 50-21(b) provides, in pertinent part:
For purposes of equitable distribution, marital property
shall be valued as of the date of the separation of the parties,
and evidence of preseparation and postseparation
occurrences or values is competent as corroborative
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MOORE V. JORDAN
Opinion of the Court
evidence of the value of marital property as of the date of
the separation of the parties.
N.C. Gen. Stat. § 50-21(b) (emphasis added). Accordingly, at best, Elliott’s
spreadsheet and testimony would have been competent as corroborative evidence of
the value of the Moores’ business interest.
In any event, this alleged asset was never presented to the district court
because there was not sufficient supporting evidence for equitable distribution
purposes. Jordan questioned Elliott about the spreadsheet and business interest
during his deposition prior to equitable distribution:
[JORDAN:] All right. Now over to the right I see that
you’ve got some accounts listed and you have Carol IRA,
Carol taxable, Jim IRA, Jim taxable, 20 percent of business
and rental house equity.
[ELLIOTT:] Yes, sir.
Q. Okay. Can you explain what those accounts are and
numbers represent?
A. The IRA and taxable are the accounts that are managed
by my firm. Twenty percent of business references what I
was – I guess what I was told was his interest in his new
business. And that is the estimate of the value of that
stock.
Q. And is that based on what he told you?
A. Yes, sir.
Q. And what was that new business?
A. I’ve gone blank on the name. It’s where he’s currently
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Opinion of the Court
employed.
...
Q. . . . [E]arlier you were talking about a business that [Dr.
Moore] had 20 percent interest in.
A. Okay; right.
Q. And you couldn’t remember the name of it. And I’m – I
want to know if it was Highline FI. Or was it Mentis
Analytics or some other business?
A. I believe Highline was his old company.
Q. Uh-huh.
A. And . . . The 20 percent was in the new business that I
believe is located in Texas.
Q. Okay. But you don’t remember the name of it?
A. I’ve gone totally blank; and that doesn’t sound familiar.
Elliott’s spreadsheet includes the specific disclosure that “Wilbanks, Smith and
Thomas Asset Management LLC does not guarantee the accuracy of the data or future
performance returns.” (emphasis added). And although plaintiff argues that this
“asset should have been disclosed, valued, and distributed as marital property”
during the equitable distribution trial, she presents no evidence of its existence
beyond Elliott’s spreadsheet and testimony. Indeed, plaintiff fails to provide even the
name of any business in which she and Dr. Moore claimed a 20% ownership interest.
In short, “plaintiff has not forecast any evidence which would permit the court to
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MOORE V. JORDAN
Opinion of the Court
identify, value or classify” any alleged asset not considered by the equitable
distribution court, “and in the absence of this evidence, the court could not value or
classify the property.” Young, 185 N.C. App. at 649, 649 S.E.2d at 474.
Plaintiff also contends that defendants breached the community’s standard of
care by failing to present expert financial testimony to support her theory that Dr.
Moore hid marital assets. Plaintiff supports this contention by relying upon the
report and deposition testimony of Buddy Herring, her own expert witness in the
instant case.
An attorney must “represent his client with such skill, prudence, and diligence
as lawyers of ordinary skill and capacity commonly possess and exercise in the
performance of the tasks which they undertake. The standard is that of members of
the profession in the same or similar locality under similar circumstances.” Rorrer,
313 N.C. at 356, 329 S.E.2d at 366. However, “[t]he mere fact that one attorney-
witness testifies that he would have acted contrarily to or differently from the action
taken by defendant is not sufficient to establish a prima facie case of defendant’s
negligence. . . . Differences in opinion are consistent with the exercise of due care.”
Id. at 357, 329 S.E.2d at 367.
During his deposition in the instant case, Jordan explained why he decided
not to present plaintiff’s expert evidence to the equitable distribution court:
[Allen] had lots of questions. He had theories. But
there were no – there was nothing that could be
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MOORE V. JORDAN
Opinion of the Court
substantiated to his various theories about the money.
And, therefore, I deemed it speculative.
It was unsupported. . . . I did express concern about
the quality of the work of Carl Allen on multiple occasions.
And I don’t believe that Heather Linton did work that
would be usable.
. . . I discussed with Ms. Moore on many occasions
leading up to the trial the – the concern that I had with
regard to what evidence we had of the so-called missing
money.
It was non-existent. And as a lawyer, you have an
obligation to not offer evidence that you know is not going
to be allowed in and doesn’t – doesn’t represent probative
evidence.
...
I’ve also found that in my 40-some years of trial
practice that you weaken a case when you’re trying a case
to the bench by offering evidence that’s basically fluff or
speculative and subject to multiple attacks by the
opposition.
So if you don’t have something that is really
probative, you’re better off leaving it alone, instead of
setting up a dummy for the other side to knock down and
make you look bad with.
“The law is not an exact science but is, rather, a profession which involves the
exercise of individual judgment.” Id. Contrary to plaintiff’s arguments, Jordan’s
failure to present evidence that he, in his professional judgment, deemed
“speculative” and “unsupported” is consistent both with the exercise of due care in
representing plaintiff’s action, and with his duty of candor to the court.
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MOORE V. JORDAN
Opinion of the Court
III. Conclusion
Plaintiff failed to forecast sufficient evidence for the trial court to consider
regarding any alleged marital asset. Without such evidence, the trial court could not
determine whether plaintiff might have obtained a judgment in excess of the one that
she actually received at equitable distribution. Furthermore, contrary to plaintiff’s
arguments, there is no evidence that defendants failed to exercise due care and
diligence in representing plaintiff’s action. Since plaintiff failed to establish that any
alleged negligence on the part of defendants proximately caused damage to her, we
affirm the trial court’s order granting defendants’ motion for summary judgment.
AFFIRMED.
Judges DAVIS and TYSON concur.
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