The Pennsylvania Superior Court has upheld the overturning of a $525,000 legal malpractice verdict against Pietragallo Gordon Alfano Bosick & Raspanti, making moot the firm’s request for a new trial in the event its judgment notwithstanding the verdict was reversed.
In September 2011, an Allegheny County Court of Common Pleas jury found Pietragallo Gordon breached its contract to plaintiff Robert Lewis by allowing a cohabitation agreement Lewis signed to provide for annual payments to his girlfriend in the event of a breakup rather than the one-time lump-sum payment Lewis preferred. The jury found Lewis didn’t breach his end of the contract and awarded him $525,000 in damages.
But the trial court, in granting JNOV in August 2012, found the evidence didn’t support the jury’s verdict because Lewis failed to read a note from a Pietragallo Gordon attorney saying two versions of the contract were provided for him to sign—one with a lump-sum clause and another providing for annual payments.
The trial court therefore denied Lewis’ request for post-judgment interest. Pietragallo Gordon later asked the trial judge to rule on its outstanding motion for a new trial in the alternative to JNOV so that the issue would be resolved in the event Lewis successfully appealed the entry of JNOV.
In October 2012, the trial court denied that motion, ruling a new trial wouldn’t be warranted if the JNOV was reversed. Pietragallo Gordon appealed the order regarding a new trial and Lewis appealed the entry of JNOV.
Now the three-judge panel of the Superior Court has affirmed the trial judge in a memorandum opinion, ruling it was in fact Lewis who breached the contract rather than Pietragallo Gordon.
“As the trial court states, ‘communication is a two-way street,’” Judge Kate Ford Elliott said for the Superior Court. “We agree that Lewis breached the contract with [Pietragallo Gordon] by failing to read critical correspondence from attorney Kelleher and failing to read or seek clarification of the unfinished document prior to signing it.”
The court further ruled Lewis failed to prove actual damages. Ford Elliott said that Lewis’ girlfriend at the time, Jill Neely, wanted the annual payments in the event their relationship ended. Ford Elliott said there was no indication Neely would have agreed to the lump-sum payment Lewis preferred.
“If the agreement had provided for a lump-sum payment, Neely might not have signed it,” Ford Elliott said. “In this regard, Lewis’ damages were speculative.”
James R. Schadel of Weinheimer, Schadel & Haber in Pittsburgh represented Pietragallo Gordon. Maurice A. Nernberg Jr. of Nernberg & Associates in Pittsburgh represented Lewis.
Schadel said this was a difficult case to try because there is little guidance from the appellate courts on how to try a breach of contract legal-malpractice case that essentially sounds in negligence. He said the court’s opinion in this case is important because it serves to show not only that clients have an obligation to read what their attorneys give them, but also that a different contract provision in the underlying matter would have been agreed to by the other party.
“These are really fundamental and important issues and we are contemplating a request to the court to publish this opinion,” Schadel said.
According to the opinion, Lewis hired Pietragallo Gordon in 1995 to prepare a cohabitation and custody agreement with Neely. The two had a son together and Neely was living in New Mexico with the child. Lewis wanted the two to move to live with him in Pittsburgh but didn’t want to marry Neely or be considered to have a common-law marriage with her, Ford Elliott said.
Several drafts of the agreement were generated and the issue of lump-sum or annual payments became one of contention. Neely had rejected the version with the lump-sum payment clause. She later contacted a Pietragallo Gordon attorney and informed the attorney Lewis had changed his mind and agreed to the annual payments, according to the opinion.
Pietragallo Gordon sent a handwritten letter to Lewis enclosing two drafts of the agreement—-one with the lump-sum clause and the other with the annual payments clause. In the letter, the attorney said both versions were included and that Lewis should choose which version he wanted to sign. Lewis didn’t read the letter and signed the document and mailed it to Neely, Ford Elliott said. Neely signed the portion with the annual payments and sent it back to Lewis, who signed the final draft.
When the couple split up in 2003, Neely made claims to the trial court for annual payments. That dispute was later settled in arbitration and Lewis then sued Pietragallo Gordon for breach of contract, legal malpractice and breach of fiduciary duty, according to the opinion.
The trial court granted the law firm’s motion for summary judgment based on a statute of limitations argument. Lewis appealed and an earlier panel of the Superior Court ruled in 2009 that the breach of contract claim could survive summary judgment. The case went to trial on that sole count.
Judge Cheryl Lynn Allen and Senior Judge Robert E. Colville joined Ford Elliott in the memorandum decision Dec. 5 in Lewis v. Pietragallo Bosick & Gordon.
(Copies of the 11-page opinion in Lewis v. Pietragallo Bosick & Gordon, PICS No. 13-3289, are available from The Legal Intelligencer. Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information.) •