                                                                                                                           Opinions of the United
2005 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


11-14-2005

Winters v. Patel
Precedential or Non-Precedential: Non-Precedential

Docket No. 04-4072




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                                                         NOT PRECEDENTIAL

                UNITED STATES COURT OF APPEALS
                     FOR THE THIRD CIRCUIT


                    Nos. 04-4072, 04-4263 & 04-4792


                          SUSAN F. WINTERS,

                                    v.

   MARYAGNES FRANGIPANNI PATEL, AS PAST ADMINISTRATRIX,
       FIDUCIARY AND ACCOUNTANT OF THE ESTATE OF
      RONALD PATEL, DECEASED, AND IN HER OWN RIGHT;
        JOHN DOE, ADMINISTRATOR OF THE ESTATE OF
     RONALD PATEL, DECEASED; GARY L. BORGER, ESQUIRE

                                  Gary L. Borger,
                                           Appellant at No. 04-4072

                                  Susan F. Winters,
                                           Appellant at Nos. 04-4263 & 04-4792




              On Appeal from the United States District Court
                 for the Eastern District of Pennsylvania
                   D.C. Civil Action No. 03-cv-01737
                   (Honorable Clarence C. Newcomer)


              Submitted Pursuant to Third Circuit LAR 34.1(a)
                             October 17, 2005

Before: SCIRICA, Chief Judge, VAN ANTWERPEN and COWEN, Circuit Judges

                       (Filed: November 14, 2005)
                               OPINION OF THE COURT


SCIRICA, Chief Judge.

       In this diversity case, the District Court denied Appellant Gary Borger’s motions

for judgment as a matter of law and a new trial following a jury verdict in favor of Cross-

Appellant Susan Winters.1 Additionally, the District Court denied Winters’s motions for

supplemental fees and prejudgment interest, although the court gave Winters leave to re-

file her motion for supplemental costs and fees pending the outcome of this appeal. We

will affirm and remand to the District Court for a determination on the issue of

supplemental attorney’s fees and costs.

                                             I.

       Because we write for the parties, we will provide only a brief recitation of the

facts. On April 17, 1997, Winters hired Borger to represent her in a divorce action

against her former husband Mr. Ronald Patel. In the ensuing divorce action, Winters and

Mr. Patel eventually agreed Mr. Patel would pay Winters a total of $143,000 in four

installments. As part of the divorce settlement, approved by the court on January 7, 1999,

Mr. Patel agreed to provide his 401(k) Plan as security and take out an insurance policy

naming Winters beneficiary in an amount sufficient to cover his obligations. The divorce


   1
     The parties apparently agree that Pennsylvania law applies to the interpretation of the
release agreement at issue and New Jersey law applies to the malpractice and breach of
contract claims against Borger.

                                             2
settlement did not name either the 401(k) Plan or the insurance policy as the exclusive

method of payment in the event of Mr. Patel’s death.

       To secure the debt through Mr. Patel’s 401(k) Plan, Winters needed to obtain

either a Qualified Domestic Relations Order (“QDRO”) or a survivors annuity. Borger

advised Winters to enter into the divorce settlement, although it contained neither of these

and despite his knowledge that Winters might not ever legally qualify for a QDRO.

       Mr. Patel died on January 7, 2000, before he could complete his obligation to

Winters. As of that date, Borger had done nothing to perfect the security interests

provided in the divorce settlement. Over a month went by after Mr. Patel’s death before

Borger attempted to collect on Winters’s behalf. By that time, however, Mr. Patel’s

widow, Maryagnes Frangipanni Patel, had acquired the benefits from both the 401(k)

Plan and the insurance policy. Unaware of Mrs. Patel’s actions, Winters signed a Release

and Settlement Agreement (“the Release”) in a separate action (the “privacy action”) filed

against several defendants, including the Patels. Winters received consideration for her

agreement to the Release.

       After learning of Mrs. Patel’s actions, Winters commenced several actions against

Mr. Patel’s Estate, Mrs. Patel, and others, attempting to collect the amount due under the

divorce settlement. When these failed, Winters commenced this action against Borger,




                                             3
claiming breach of contract and malpractice.2 The case went to a jury, which returned a

verdict on both causes of action in favor of Winters and awarded her $296,544.70 in

compensatory damages, including attorney’s fees and costs up to the date of trial.

       At the end of Winters’s case and again at the close of evidence, Borger moved for

judgment as a matter of law under Rule 50. Borger also moved for a new trial or to alter

or amend judgment under Rule 59.3 The District Court denied each motion. Borger

appeals these orders as well as several of the District Court’s evidentiary rulings. We

have jurisdiction under 28 U.S.C. § 1291.

                                             II.

       Borger’s primary contention on appeal is that the evidence at trial was insufficient

to support the jury’s findings of malpractice and breach of contract. We review a District

Court’s sufficiency of the evidence determination de novo. W.V. Realty, Inc. v. N. Ins.

Co., 334 F.3d 306, 311 (3d Cir. 2003) (citing Lightning Lube, Inc. v. Witco Corp., 4 F.3d

1153, 1166 (3d Cir. 1993)). The District Court’s decision will stand unless, “viewing the

evidence in the light most favorable to the non-movant . . ., there is insufficient evidence

from which a jury reasonably could find liability.” Id. We review the District Court’s

decision to deny a motion for a new trial for abuse of discretion. Id.



   2
    Mrs. Patel is also a named defendant in this action. Winters’s appeal from the
judgment entered in favor of Mrs. Patel is addressed in a separate opinion of this Court.
   3
    Borger makes no meaningful challenge to the District Court’s decision to deny his
Rule 59(e) motion to alter or amend judgment. This issue is, therefore, waived.

                                              4
       According to Borger, any negligence Winters proved with regard to his handling of

the 401(k) Plan is irrelevant because the Plan was not intended to secure Mr. Patel’s debt

in the event of his death. But on this point, the evidence at trial was conflicting on the

intended function of the 401(k) Plan, and this challenge must be resolved in favor of the

jury’s verdict. Thus, the verdict supports the view that the parties intended the 401(k)

Plan to secure Mr. Patel’s debt in the event of any default, including death.

       In addition, Winters provided evidence showing Borger acted negligently when he

included in the divorce settlement a security interest that he knew may never be secured.

According to Winters’s testimony, she thought the divorce settlement secured the debt

owed to her. A reasonable jury could find, had Winters known one of the two security

devices provided in the divorce settlement was possibly ineffective, she would have acted

differently to obtain a more secure agreement. Therefore, the evidence was sufficient to

support the jury’s verdict that Borger’s conduct breached his contractual and professional

duties to Winters and caused her damage.

       Borger also challenges the jury’s damage award on two grounds. First, he asserts

his conduct caused Winters no damage because Mr. Patel’s debt to Winters was “paid” by

the parties to the privacy action. However, Winters claimed at trial that she was not in

fact paid. The jury was entitled to accept Winters’s version of events and reject Borger’s

contention that the consideration Winters obtained constituted payment for Mr. Patel’s

debts. We also reject Borger’s contention that Packard-Bamberger & Co., Inc. v. Collier,



                                              5
771 A.2d 1194, 1204 (Pa. 2001), requires a court, and not a jury, to decide the issue of

attorney’s fees and costs. The Packard-Bamberger decision did not address the jury’s

authority to decide such issues, and, in fact, did not involve a jury trial at all.

       Borger also contends the evidence was insufficient to support the jury’s award of

attorney’s fees and costs. In particular, Borger takes issue with Winters’s recovery of the

fees and costs she incurred in unsuccessful actions she brought to recover the debt Mr.

Patel owed her. Borger improperly focuses on the alleged lack of success of those actions

and ignores the evidence that they were necessary to retrieve the monies that his own

conduct caused Winters to lose. See Lovett v. Estate of Lovett, 593 A.2d 382, 389-90

(N.J. Ch. 1991) (noting “loss of time, attorney fees and other expenditures” from

collateral litigation incurred as a “proximate result” of a person’s tortious actions are

recoverable); see also Conklin v. Hannoch Weisman, 678 A.2d 1060, 1071 (N.J. 1996)

(rejecting the contention that simple “but for” causation applies in “cases in which the

attorney’s negligent conduct combines with other causes that lead to the client’s injury”).

Winters presented competent evidence through her own testimony regarding the amount

of fees she incurred in this and other actions.4 The jury’s verdict is supported by the

evidence, and the District Court did not abuse its discretion in denying a new trial on this

ground.


   4
     The District Court did not abuse its discretion in allowing Winters to refresh her
recollection under Fed. R. Evid. 803(5) regarding the amount of legal fees and costs she
has incurred to date.

                                                6
       Borger next contends the District Court erred in admitting the testimony of

Winters’s expert witness. Borger asserts Winters’s expert testified outside of the scope of

the expert report, did not testify to a “reasonable degree of certainty,” and offered

speculative and legally conclusive testimony. We review decisions regarding the

admission of expert testimony under an abuse of discretion standard. United States v.

Davis, 397 F.3d 173, 178 (3d Cir. 2005). After a review of the record, we see no error in

the District Court’s decision to admit this testimony.

       We also reject Borger’s contention that the privacy action Release bars Winter’s

claims against him. The construction of a contract is generally a legal issue that is

reviewed de novo. Vanguard Telecomm., Inc. v. S. New England Tel. Co., 900 F.2d 645,

650 (3d Cir. 1990). However, the intent of the parties to a contract is a question of fact,

which will only be set aside if it is clearly erroneous. Coca-Cola Bottling Co. of

Elizabethtown, Inc. v. Coca-Cola Co., 988 F.2d 386, 401 (3d Cir. 1993).

       On its face, the Release limits its applicability to the parties to the privacy action

and others who are “jointly and severally liable.” Borger was neither party to nor a joint-

tortfeasor in that action. See Austin J. Richards, Inc. v. McClafferty, 538 A.2d 11, 16 (Pa.

Super. Ct. 1988) (determining an attorney was not jointly liable with the principal

defendant for having provided deficient legal advice). However, even if the Release is

ambiguous regarding its scope of coverage, the District Court found Borger could not

benefit from the Release because he was not an intended beneficiary. See Scarpitti v.



                                               7
Weborg, 609 A.2d 147, 150 (Pa. 1992); see also Harrity v. Med. Coll. of Pa. Hosp., 653

A.2d 5, 11 (Pa. Super. Ct. 1994) (distinguishing Buttermore v. Aliquppa Hosp., 561 A.2d

733, 735 (Pa. 1989), by finding language in a release limiting its applicability to only

those claims raised in the instant action). Borger cites no contrary evidence of intent

upon which to find clear error in this conclusion. Therefore, Borger cannot rely on the

Release as an affirmative defense.

       Borger next contends the District Court cited incorrect legal standards to the jury

for the award of damages in malpractice actions. “We exercise plenary review to

determine whether jury instructions misstated the applicable law.” Cooper Dist. Co. v.

Amana Refrig., Inc., 180 F.3d 542, 549 (3d Cir. 1999). The District Court instructed the

jury to award costs and fees for litigation “the plaintiff had to bring as a natural

consequence of the Defendant’s malpractice.” As discussed above, this is an adequate

statement of the law on the recovery of attorney’s fees and costs in malpractice actions.

       Borger also challenges several evidentiary rulings. First, he contends a new trial is

warranted by the District Court’s exclusion of evidence of the negotiations underlying the

divorce settlement agreement. We review the admission or exclusion of evidence for

abuse of discretion. In re Merritt Logan, Inc., 901 F.2d 349, 359 (3d Cir. 1990). The

District Court excluded this evidence on the basis of the parole evidence rule. In his

appeal, Borger presents no persuasive challenge to this decision. We, therefore, affirm.




                                               8
       Borger also contests the admission of evidence relating to Mrs. Patel’s sale of a

condominium she and Mr. Patel owned before his death. Because Borger does not make

the basis for his challenge clear, we presume he raises the same double-hearsay issue he

raised to the District Court. But Borger provides no legal basis upon which to overturn

the District Court’s hearsay findings. We see no error here.

       Finally, Borger contends a new trial is warranted by several allegedly improper

statements made by Winters’s counsel during the trial. The District Court declined to

grant a new trial finding it was not “reasonably probable” that the alleged misconduct

influenced the jury. We review for abuse of discretion. Greenleaf v. Garlock, Inc., 174

F.3d 352, 363 (3d Cir. 1999). Considering the District Court’s close management of the

trial as well as the inconsequential nature of Winters’s counsel’s alleged misconduct, we

see no error.

                                            III.

       Winters filed two cross-appeals in this action challenging the District Court’s

decisions on her requests for supplemental attorney’s fees and prejudgment interest.5 In

an order dated December 1, 2004, the District Court denied Winters’s request for

supplemental attorneys fees and costs incurred during the trial and appeal of this action.


   5
     Winters also replies to Borger’s appeal with a challenge to the District Court’s
decision to quash a subpoena. Winters asserts this evidence is necessary to establish her
case against Mrs. Patel for fraud. It is unclear why Winters expects Borger to respond to
this appeal. Nevertheless, the issue is made moot by our related opinion affirming the
judgment below entered in favor of Mrs. Patel.

                                             9
However, the District Court also correctly granted Winters leave to re-file her request

pending the outcome of this appeal. In light of our decision affirming the verdict below,

we will remand the matter to the District Court to determine the reasonableness of fees

expended by Winters in the prosecution of the matters against defendants Mrs. Patel and

Borger, fees expended in the appeal of those matters to this Court, and, finally, fees

expended in the remanded proceedings.6

       On the other hand, we reject Winters’s challenge to the District Court’s order

denying her motion for prejudgment interest. Having not yet determined Winters’s

entitlement to discretionary prejudgment interest at the time of judgment, the District

Court’s omission of such an award cannot be considered a “clerical mistake” correctable

under Rule 60(a). See Keith v. Truck Stops Corp. of Am., 909 F.2d 743, 746-47 (3d Cir.

1990) (motions for prejudgment interest under New Jersey law are properly characterized

as Rule 59(e) motions to alter or amend judgment); Rosen v. Rucker, 905 F.2d 702, 705-

06 (3d Cir. 1990) (same under Pennsylvania law). The District Court properly

considered her motion an untimely Rule 59(e) motion, and we will affirm on this point.




   6
     We suggest that the District Court confer with counsel in an effort to amicably
resolve what the reasonableness of those various fees should be.

                                             10
                                             IV.

         For the reasons stated, we will affirm the judgment and remand the action back to

the District Court for a determination on the issue of supplemental attorney’s fees and

costs.




                                             11
