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HomeMy WebLinkAbout2007 S 1441 JAMES E. HARBAUGH : IN THE COURT OF COMMON PLEAS OF : ADAMS COUNTY, PENNSYLVANIA V.: : JOHN R. WHITE, ESQUIRE : : V.: : CAMPBELL AND WHITE, P.C. : NO. 2007 – S – 1441 : : CIVIL ACTION – LAW : IN RE: OPINION PURSUANT TO Pa. R.A.P. 1925 Guido, J., January , 2010 The plaintiff commenced this legal malpractice action against the defendants as a result of a prenuptial agreement that proved to be unenforceable. After hearing the evidence at a bench trial we found in favor of the defendants. Plaintiff has filed this timely appeal in which he contends that we erred by 1) concluding that the defendants were not negligent; 2) finding that any harm sustained by plaintiff was the result of his own negligence; and 3) making limited findings of fact before reviewing the post trial 1 briefs submitted by the parties. FACTUAL BACKGROUND Before addressing the specific issues raised by the plaintiff we will recite the facts as we found them to be. Plaintiff had been a friend and client of defendant White for many years. On Wednesday, June 13, 2001 he called to inform White that he needed a prenuptial agreement before his wedding which was scheduled to take place in about 1 See Plaintiff’s Matters Complained of on Appeal. ADAMS COUNTY – 2007 – S – 1441 – CIVIL ACTION forty eight hours. Because of their longstanding relationship White agreed to undertake 2 the project. White advised plaintiff that it was important for him and his fiancée to fully disclose their assets and obligations to each other. He further suggested that they should each prepare a list of those assets and liabilities to be attached as schedules to the agreement. Plaintiff promised to provide the lists at the time the agreement was executed. At 8:46 a.m. on Thursday, June 14, 2001 White sent a draft of the agreement to plaintiff. He directed plaintiff to provide a copy to his fiancée. He also instructed them 3 both to review the agreement “carefully.” Plaintiff did not present the agreement to his fiancée until 10:30 p.m. that night as they were lying in bed. Since they had never 4 discussed a prenuptial agreement, his fiancée was both “surprised and upset.” Nevertheless she accompanied him to defendants’ offices at noon on June 15, 2001 to execute the agreement. White explained to plaintiff’s fiancée that he was representing only the plaintiff. He further advised that she had the right to have her own attorney review the agreement. Because she was preoccupied with the final preparations for her wedding which was to occur in just a few hours, she elected to proceed without her own counsel. The parties had not prepared the schedules of assets and liabilities to attach to the 5 agreement as plaintiff had promised. This was an obvious concern to White. He asked 2 The action against Campbell and White, P.C. is based upon it being vicariously liable for the actions of White. 3 See Plaintiff’s Exhibit # 1. 4 Transcript of Proceedings, June 9, 2009, p. 109. 5 He correctly concluded that “I had to satisfy myself, to the extent possible, that they had, in fact, made a mutual disclosure of their respective financial net worths.” Transcript of proceedings, June 9, 2009, p. 90. 2 ADAMS COUNTY – 2007 – S – 1441 – CIVIL ACTION them if they had fully discussed and disclosed their various assets and obligations. Both parties assured him that they had (even though they had not). Being satisfied that they were aware of each other’s financial net worth White proceeded to have them execute the agreement. The parties separated in September 2004. Shortly thereafter plaintiff filed a complaint in divorce. His fiancée/wife sought to set aside the prenuptial agreement. In support of her request she alleged in relevant part as follows: On the night before the parties’ marriage at approximately 10:30 p.m. Respondent presented to Petitioner a Pre-Nuptial Agreement he had had prepared by his attorneys . . . Respondent reviewed the Agreement on the date of her wedding and feeling she had no other choice, appeared at the office of Campbell & White to execute the Agreement at approximately 1:30 in the afternoon. . . . The parties were married at approximately 5:00 p.m. . . . Petitioner executed the Pre-Nuptial Agreement without the advice of counsel or the ability to obtain the advice of counsel on the day of her she signed it under duress wedding. Furthermore, the wedding plans having been made, wedding gifts received and weddings guests invited. The Agreement makes no full and fair disclosure as it fails to attach Petitioner did not know the Exhibits “A” and “B” as set out therein. extent of Respondent’s separate estate nor its value. 6 (emphasis added). After conducting hearings on the matter the Honorable Robert G. Bigham issued an order declaring: The Pre-Nuptial Agreement dated June 15, 2001 and entered into by the parties on their wedding day is hereby set aside and will be considered 7 unenforceable. 6 Plaintiff’s Exhibit # 6. 7 Plaintiff’s Exhibit # 8. 3 ADAMS COUNTY – 2007 – S – 1441 – CIVIL ACTION DISCUSSION Negligence of defendants. Negligence in the area of legal malpractice has been defined as the attorney’s “failure to exercise ordinary skill and knowledge”, Kituskie v. Corbman, 552 Pa. 275, 281, 714 A.2d 1027, 1029 (1998). In the instant case plaintiff alleged that White was negligent in failing to advise him that the agreement could not be enforced unless the schedules were attached to the agreement before it was executed. We did not agree. At the time the agreement was executed the law controlling its enforceability was 8 contained in the seminal case of Simeone v. Simeone, 525 Pa. 392, 581 A.2d 162 (1990). The requirements for enforceability included, inter alia, “a full and fair disclosure of the financial positions of the parties.” 581 A.2d at 167. “If an agreement provides that full disclosure has been made, a presumption of full disclosure arises.” Id. The presumption can then be rebutted only by clear and convincing evidence. Id. The agreement prepared by White provided that a full disclosure had been made. Furthermore, he tried to impress upon plaintiff the importance of such a disclosure. To insure that the disclosure had been accomplished he suggested that the parties prepare schedules of their assets and liabilities to be attached to the agreement. When they showed up at his office without the promised schedules, White realized that he had to make sure “they had in fact, made a mutual disclosure of their respective financial net 9 worths.” He questioned them both and was assured that they had discussed, disclosed, and were aware of each other’s assets and obligations. Under those circumstances we 8 The requirements of Simeone, have since been codified with the addition of Section 3106 to the Divorce Code. 23 Pa. C.S.A. Section 3106. 9 Transcript of Proceedings, June 9, 2009, p. 90. 4 ADAMS COUNTY – 2007 – S – 1441 – CIVIL ACTION were satisfied that White had the knowledge and exercised the skill necessary to provide plaintiff with competent non-negligent representation. Plaintiff’s own negligence caused his harm. The harm to befall plaintiff was the unenforceability of the prenuptial agreement. What is not clear is the grounds upon which the agreement was set aside. Lack of a full and fair disclosure of the parties’ financial positions is one possibility. Duress is another. Both were alleged by plaintiff’s fiancée in her petition to set aside the agreement. Although neither was specified by Judge Bigham in his order, either was possible under the facts of this case. In any event, we were satisfied that it was plaintiff’s own negligence which led to his harm. We found that the plaintiff was negligent in several respects. He waited until the very last minute to request White to prepare the agreement. He did not complete the schedules as White advised him (and he promised) to do. He did not present the agreement to his fiancée until late the night before it was to be executed, thereby effectively precluding her from obtaining independent legal counsel. He did not even raise the prospect of a prenuptial agreement with his fiancée until he presented it to her less than 24 hours before they were scheduled to exchange vows. Finally, and most importantly, he misled his attorney on the issue of full and fair disclosure. Making limited findings of fact. At the conclusion of the testimony we gave counsel the opportunity to make a closing argument. Plaintiff’s counsel expressed a preference for submitting a brief 5 ADAMS COUNTY – 2007 – S – 1441 – CIVIL ACTION 10 instead. We made it clear that we were only interested in a brief on the legal issues. We then had an in depth exchange with plaintiff’s counsel regarding the facts established by the evidence. At the end of our exchange we made limited findings of fact in order to narrow the focus of the parties’ briefs. Counsel did not cite, nor are we aware of, any authority that would preclude us from proceeding as we did. ___________________ _____________________________ DATE Edward E. Guido, J. Richard Caplan, Esquire Edwin A.D. Schwartz, Esquire John White, Esquire :sld 10 Having just heard the evidence and observed the witness, we were prepared to make certain findings of fact at that time. 6