(J. Albert Diaz)
Shutts & Bowen, Miami’s oldest law firm, got its name cleared in a three-week legal malpractice trial.
Bowman Brown, the executive committee chairman at Shutts & Bowen, partner Ricardo J. Souto and the firm were the litigation targets of Rodger D. Shay, former chairman of Merrill Lynch Government Securities Inc.
The Wall Street millionaire hired Brown and Souto in 2005 to review contracts for the purchase of an oceanfront lot and a condominium in a planned luxury country club in the Dominican Republic.
His 2010 lawsuit accused them of not tying up contractual loopholes and advising him to wire the money. But it turned out the properties were not owned outright by the purported seller.
Several banks foreclosed on the properties, leaving Shay with a $2.7 million loss.
During closing arguments Thursday, Shay’s attorney, Brian Stack of Stack Fernandez Anderson & Harris in Miami, tried to convince jurors the attorneys did not meet their standard of care.
“This case is about accountability and responsibility. Were the lawyers that Mr. and Mrs. Shay retained accountable to him?” Stack asked. “Or when the heat started to rise in the kitchen, did they begin to point the finger at everybody else?”
Stack claimed Brown, as head of the firm’s financial services practice group, and Souto, a tax and estate attorney, lacked the experience to properly advise the couple on the real estate purchases. Stack maintained the documents should have been reviewed by Shutts & Bowen’s real estate group.
“Give it to somebody that knows what they’re doing, that can spot the issues,” Stack said.
Instead, the attorneys sent the documents to a Dominican lawyer, Elizabeth Mena.
The Shays asked for $2.66 million in damages. The jury deliberated less than two hours before finding in favor of the attorney and firm, said lead defense attorney Kendall Coffey of Coffey Burlington in Miami.
The jury concluded the defendants did not commit professional negligence.
“We are extremely gratified that after a very fair three-week trial, two of Miami’s finest lawyers were so completely vindicated,” Coffey said. He was assisted at trial by David P. Ackerman of Ackerman Link & Sartory in West Palm Beach and Miranda Soto of Hamilton, Miller & Birthisel in Miami.
The defense focused on the fact that the contracts were already signed. While Shay had a right to withdraw, he and the attorneys worked on correcting flaws instead.
Shay was coming after his attorneys and playing the “blame game” to recover from a risk he took, Coffey argued.
Recalling trial testimony, Coffey said Shay never asked Brown or Souto for advice on whether the deal was a good or bad idea.
“He never asked because he was a very, very smart investor who knew how to make money and thought he was going to make a lot of money,” Coffey told jurors. Shay isn’t the type who “stands and salutes” and does whatever his lawyers want.
“If he needed his lawyers to tell him what to do with his own money, he would have passed on this transaction,” Coffey said.
In the end, the jury appeared convinced Shay was going to do as he pleased.
Shay began trial claiming he thought there was an escrow account, and money would not transfer until he received title. When pressed, he admitted there was no signed escrow agreement.
Morever, Shay took it on himself to transfer the major portion without telling Brown and Souto. He told them about an $800,000 transfer, but he only told the seller’s lawyer about a $1.88 million transfer, Coffey said.
“So who is driving the train? Who is making the decision? Who has the right to make the decision? It’s Mr. Shay,” Coffey said.