(San Mateo County Super. Ct. No. CIV 473707) Trial Court: San Mateo County Superior Court Trial Judge: Honorable Gerald J. Buchwald
The opinion of the court was delivered by: Sepulveda, J.
CERTIFIED FOR PUBLICATION
The personal representative of an Oregon estate brought a legal malpractice action against California attorneys who had been retained by the previous representative in an unsuccessful lawsuit against the decedent's California business partner. The current estate representative alleged that his predecessor's attorneys prosecuted a meritless lawsuit that unnecessarily expended estate assets. The attorney defendants moved for judgment on the pleadings contending that the Oregon representative lacked capacity to sue because his authority did not extend beyond Oregon, and lacked standing to sue because the plaintiff representative was never a client of the attorneys. (Code Civ. Proc., § 438.) The trial court granted the motion on the second ground. The court held that Oregon law controls the rights of an Oregon estate representative and, under Oregon case law, a successor representative has no standing to prosecute a legal malpractice claim against attorneys retained to represent the predecessor representative.
The estate representative appeals and argues that he has standing under both California and Oregon law. Defendants dispute that argument, and renew their challenge to the representative's capacity to sue. We conclude that the Oregon representative lacks capacity to sue in California because his authority "does not extend beyond the jurisdiction of the government under which that person was invested with authority"--Oregon. (Code Civ. Proc., § 1913, subd. (b).) However, the Oregon representative may be able to obtain ancillary appointment by a California court that vests him with the capacity to sue, and must be given an opportunity to do so. (Prob. Code, § 12510 et seq.) We also conclude that, under both California and Oregon statutory law, the representative has standing to sue attorneys who were retained by his predecessor to act on the estate's behalf. (Prob. Code, §§ 8524, subd. (c), 9820, subd. (a); Or. Rev. Stat. §§ 113.215, subd. (4), 114.305, subd. (19).) Moreover, even if Oregon law differed from California law on this point, California law should be applied given this state's strong interest in regulating attorneys licensed and practicing here. We reverse the judgment.
Decedent William Hinkley Adam Smith had lived in California for many years but moved to Oregon around 2000. In 2001, he and his wife, Genevieve Smith, retained California attorney Jerry K. Cimmet to represent them in the investigation of William Smith's business partnership with Charles McPherson in order to determine whether the couple had any claims against McPherson. McPherson managed investments held in partnership with William Smith. In 2003, following the attorney's investigation, decedent and his wife authorized attorney Cimmet to negotiate with McPherson for settlement of their claims. The business dispute did not settle.
Decedent died in Oregon on April 12, 2004, at the age of 91. He was survived by his wife, Genevieve Smith, and two adopted children from an earlier marriage, a daughter and a son, Daniel C. Smith. An Oregon court appointed Genevieve Smith personal representative of decedent's estate (the Estate).
In May 2004, Genevieve Smith, individually and as representative of the Estate, signed a new agreement with attorney Cimmet authorizing him to file a lawsuit against McPherson. Attorney Cimmet joined with another California attorney, Matthew Pavone, and filed a lawsuit in Marin County Superior Court (the Marin Action).
In August 2004, decedent's children filed a petition in Oregon contesting the will as the product of the wife's undue influence, demanding her removal as personal representative of the Estate. The contested will left decedent's entire Estate to his wife, Genevieve Smith, and disinherited his children. In addition to contesting the will in probate court, decedent's children also sued the wife civilly for interference with their inheritance.
Meanwhile, in California, a defense summary judgment was entered in the Marin Action filed by Genevieve Smith against McPherson. Judgment was filed in June 2006. Genevieve Smith authorized attorneys Cimmet and Pavone to appeal the judgment.
While the California appeal was pending, Genevieve Smith lost the Oregon civil and probate actions filed against her. In August 2006, a jury in the civil lawsuit found that Genevieve Smith had interfered with the prospective inheritance of her husband's children, and assessed damages of $1.5 million. In February 2007, a probate judge held invalid decedent's will leaving his entire Estate to his wife and disinheriting his children. The court found the contested will to be the product of the wife's undue influence. The court admitted for probate an earlier will that provided generously for the wife but that made decedent's children the residual beneficiaries. The court removed Genevieve Smith as personal representative of the Estate because of the undue influence she exerted over the decedent, and because there were conflicts of interest and animosity between her and the residual beneficiaries. The court appointed a new personal representative, who himself was soon replaced by decedent's son, Daniel Smith, in March 2007.
In June 2007, attorneys Cimmet and Pavone withdrew as counsel of record for Genevieve Smith in the pending appeal of the Marin Action. The appeal was abandoned in August 2007 after Daniel Smith refused to fund the appeal or to substitute into the Marin Action as the new representative of the Estate. McPherson, as the prevailing party in the Marin Action, was awarded attorney fees and costs against the Estate in an amount "somewhere between $600,000 to $700,000," it is alleged. It is also alleged that about $1.5 million was paid to the attorneys representing Genevieve Smith on behalf of the Estate in the Marin Action.
In April 2008, Daniel Smith, in his capacity as the new personal representative of the Estate, filed this lawsuit against attorneys Cimmet and Pavone.*fn2 Daniel Smith resides in California. The case was venued in San Mateo County California, where defendants practice law and presumably reside. Plaintiff Daniel Smith states three causes of action: legal malpractice, breach of contract, and breach of fiduciary duty. In support of all causes of action, plaintiff alleges that attorneys Cimmet and Pavone represented to decedent and his wife Genevieve Smith "that the legal services provided were necessary and appropriate when, in fact, most, if not all, were not and that the claims asserted by [decedent and his wife] relative to McPherson were, upon reasonable investigation, without merit and known to be without merit by defendants" Cimmet and Pavone. Plaintiff also alleges that the defendant attorneys "abused their confidential relationship with [decedent and his wife] by causing them to believe that the claims asserted relative to McPherson including those which were advanced in the Marin Action on behalf of the Estate were meritorious and that the legal services provided by defendants were both necessary and appropriate when they were not."
Defendant attorneys filed a motion for judgment on the pleadings in April 2010, seeking judgment in their favor as to the entire complaint. (Code Civ. Proc., § 438.) Defendants asserted that plaintiff (1) lacked capacity to sue because his authority as a personal representative of a probate estate did not extend beyond the jurisdiction that appointed him (Oregon); and (2) lacked standing to sue because no attorney-client relationship existed between the attorneys and plaintiff--the relationship was with the prior Estate representative. Plaintiff opposed the motion, arguing that he had both capacity and standing to sue. The trial court granted the motion on the second ground. Judgment in defendants' favor was entered in August 2010, and plaintiff filed a timely notice of appeal in September 2010.
A party initiating a lawsuit must have both capacity to sue (the right to come into court) and standing to sue (the right to state a cause of action seeking particular relief). (Color Vue, Inc. v. Abrams (1996) 44 Cal.App.4th 1599, 1604.) Incapacity is " 'a legal disability, such as infancy or insanity, which deprives a party of the right to come into court.' " (Ibid.) A challenge to a party's capacity must be brought at the earliest opportunity or the challenge is forfeited. (Id.; Farmers & Merchants Trust Company v. Madeira (1968) 261 Cal.App.2d 503, ...