Every Mother’s Son
The South Carolina Supreme Court affirmed the dismissal of a suit brought against an attorney under the following circumstances:
Appellant filed the underlying lawsuit against Respondent arising out of his representation of her husband, Lewis M. Argoe, Jr. (Husband), and son, G. Lewis Argoe, III (Son). Although now divorced, Appellant and Husband were experiencing marital difficulties at the time Respondent represented Husband and Son.
Husband and Son entered into an attorney-client relationship with Respondent, informing him that they were seeking his help in protecting Appellant from her own irresponsible and erratic behavior. They told Respondent that Appellant was acting strangely and had become financially irresponsible. Specifically, Husband and Son informed Respondent that Appellant had taken out a loan against a condominium she owned in Beaufort County, South Carolina (the Beaufort Property). Appellant told no one about the loan, allowed it to go into default, and the Beaufort Property was about to enter foreclosure. Respondent learned that Son was Appellant’s attorney-in-fact pursuant to a Durable Power of Attorney executed by Appellant on April, 20, 2004. In order to avoid financial disaster, Respondent assisted Son in the transfer of title to the Beaufort Property to a trust for the benefit of Appellant. Son was the residual beneficiary to the trust and would receive legal title to the Beaufort Property in the event of Appellant’s death. Pursuant to Appellant’s then-existing estate plan, Son was already to receive the property upon her death. Thus, the creation of the trust at issue was consistent with the status quo.
Appellant alleges that Husband orchestrated the transfer of title to the Beaufort Property and her involuntary commitment because he feared she was going to divorce him. Husband and Son maintain these actions were taken to protect Appellant from herself. Respondent understood Husband and Son’s motivations to be benevolent and there is no evidence in the record to indicate that he had reason to believe otherwise.
On August 15, 2006, Appellant filed an action against Respondent in Beaufort County asserting various causes of action, including setting aside influenced transactions, professional negligence, breach of fiduciary duty, breach of trust, invasion of privacy, intentional infliction of emotional distress, violation of civil rights, conspiracy, conversion, and abuse of process. On June 6, 2007, Appellant filed another action in Lexington County arising out of the same facts and circumstances, but naming additional defendants. The two lawsuits were combined in Lexington County. Respondent filed a motion for summary judgment, which was granted by the trial court as to all causes of action.
The court concluded that summary judgment was properly granted as the attorney had no duty of care or attorney-client relationship with the mother.
Justice Pleicones disagreed:
I agree that, generally, where an individual who holds a power of attorney hires an attorney, that attorney’s client is the attorney-in-fact and not the principal who executed the power. I also agree that, in general, an attorney who acts in good faith with the authority of his client is not liable to a third party for the performance of his professional services. However, an attorney may be liable to a third party where he conspires with a client against that third party, or where his professional negligence injures a party in privity with his client. (citations omitted)
In other words, I largely agree with the majority on the applicable law. Where I disagree, however, is with the consequences, at least for the purposes of summary judgment, of respondent’s advice and assistance to Son to exercise his authority as Appellant’s attorney-in-fact to transfer title to the Beaufort Property from Appellant’s name into a trust. Unlike the majority, I am not persuaded that, because at the time the property was transferred to the trust, Son was also the devisee under Appellant’s current will, it can be said that this transfer was, as a matter of law, not a self-gift. Until the transfer of title to the trust, Appellant had the right to dispose of the property during her lifetime or to change her testamentary disposition of the Beaufort Property. Once the trust was established, however, she could no longer dispose of this property during her lifetime or in her will.
In my opinion, the evidence here is sufficient to withstand respondent’s motion for summary judgment on appellant’s claims of legal malpractice and conflict of interest. I would reverse.
(MIke Frisch)