United States District Court, D. Colorado
DRORIT SILVERMAN, a/k/a Drorit DeAngelo, individual, Plaintiff,
v.
DALLAS D. GREENFIELD, HOUTCHENS, GREENFIELD & SEDLIK, LLC, a Colorado limited liability company, Defendants.
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANTS' RULE 702 AND SUMMARY JUDGMENT
MOTIONS
WILLIAM J. MARTINEZ UNITED STATES DISTRICT JUDGE
This is
a legal malpractice action arising from a high-dollar
divorce. Plaintiff Drorit Silverman, a/k/a Drorit DeAngelo,
was the wife in the now-dissolved marriage. The Court will
refer to her as “DeAngelo, ” to avoid confusion
with her ex-husband, Paul Silverman
(“Silverman”).
DeAngelo
sues Dallas D. Greenfield, her divorce attorney, and his law
firm at the time of the divorce proceedings, Houtchens,
Greenfield & Sedlik, LLC. The parties generally refer to
Greenfield himself as the target of DeAngelo's
accusations, so the Court, for simplicity, will refer to
Defendants collectively as “Greenfield.” This
Court has jurisdiction over the dispute because DeAngelo is a
Nevada resident, Greenfield is a Colorado resident, and
DeAngelo claims that, but for Greenfield's alleged
malpractice, she would have received many hundreds of
thousands of dollars more from her ex-husband. See
28 U.S.C. § 1332(a).
Currently
before the Court are Greenfield's Motion to Strike
Unsupported Opinions of Scott Saltzman (“Rule 702
Motion”) (ECF No. 71) and Greenfield's Motion for
Summary Judgment (ECF No. 72). For the reasons explained in
detail below, the Court grants in part and denies in part
both motions. The upshot is that the case will proceed to
trial solely on DeAngelo's theories that Greenfield
violated the standard of care when he (a) did not argue for a
more favorable distribution of marital property, and (b)
failed to propose terms for a promissory note to effectuate
the marital property equalization payment.
The
analysis below first sets forth the factual background
because it is helpful to understanding all issues argued
below. The Court then turns to Greenfield's Rule 702
arguments, and finally to his summary judgment arguments.
I.
FACTS
The
following facts are undisputed unless attributed to a party
or otherwise noted.
A.
Divorce Proceedings Before Entry of Permanent Orders
1.
Commencement of Divorce Proceedings
In
March 2012, DeAngelo hired Greenfield to represent her in
proceedings to dissolve her marriage to Silverman, which had
lasted ten years. (ECF No. 81 at 8, ¶¶
1-2.)[1] At the time, Silverman had close to $4.9
million in personal, nonmarital assets and earned
approximately $42, 000 per month in passive income.
(Id. at 9, ¶ 5.) DeAngelo had $25.00 in
personal, nonmarital assets. (Id.) Their marital
assets were mostly unliquidated partnership interests, worth
about $2.5 million. (Id.)
Divorce
proceedings took place in Weld County District Court. (ECF
No. 72 at 5, ¶ 3 n.1.) “In Weld County District
Court at that time, consent to having a magistrate preside
over a domestic relations case was presumed absent
objection.” (Id.) Greenfield never advised
DeAngelo that she had the option to object. (ECF No. 81 at 9,
¶ 7.) Greenfield (on DeAngelo's behalf) did not
object, and neither did Silverman. (Id.)
During
divorce proceedings, Greenfield understood that Silverman
faced serious health issues and was hospitalized
periodically, although the parties dispute the extent of
Greenfield's knowledge about Silverman's medical
conditions. (Id. ¶ 6; ECF No. 85 at 6 ¶
6.) In August 2012, however, DeAngelo e-mailed Greenfield
about various topics, and mentioned that Silverman was
“getting a home dialysis machine.” (ECF No.
81-5.) She continued, “Does that mean he is going to
live a long time? I don't think so. SO I still want this
to be a loooong divorce. He is sick every time we think about
getting [the] kids over to his house. So it[']s difficult
for me to gauge where he is at.” (Id.
(emphasis in original).) By preferring a “loooong
divorce, ” DeAngelo meant that she hoped Silverman
would die before the magistrate could finalize the divorce,
thus mooting the proceeding and allowing her to inherit
Silverman's assets. (ECF No. 81 at 10, ¶ 10.)
2.
Contempt Citation
On
November 5, 2012, Greenfield moved to hold Silverman in
contempt for having recently withdrawn, without consent,
about $82, 000 from a bank account he held jointly with
DeAngelo, allegedly in violation of the preliminary
injunction that automatically takes effect when a divorce
petition is filed (see Colo. Rev. Stat. §
14-10-107(4)(b)(I)(A)). (ECF No. 72 at 5, ¶
4.)[2]
On November 14, 2012, the magistrate issued a show-cause
citation to Silverman. (Id. at 6, ¶ 5.) The
citation had no return date. (ECF No. 72-3.)
3.
Preparations for Permanent Orders Hearing, and
Postponement of Contempt
At some
point, not clear in the record, the magistrate scheduled a
“permanent orders hearing” for February 11 and
13, 2013. (ECF No. 85-1 at 1.) On January 18, 2013, in the
run-up to the permanent orders hearing, the parties filed a
joint trial management certificate. (Id.) In the
“Pretrial Motions” section of that certificate,
Greenfield listed the contempt motion as a “matter[] or
motion[] [that] should be addressed before [the] hearing
commences.” (Id. at 2.)
For
reasons not clear on the record, the permanent orders hearing
never took place in February 2013. On February 14, 2013-the
day after the hearing would have concluded-the magistrate
entered a decree of dissolution of marriage, “leaving
various issues, including division of marital assets and
debt, maintenance, child support, attorney's fees, and
the contempt citation” for a later trial to the court.
(ECF No. 72 at 6, ¶ 6; ECF No. 15 ¶ 15.)
The
permanent orders hearing eventually was rescheduled for
January 21-22, 2014. (ECF No. 72-4 at 1-2.) On December 6,
2013, in the run-up to the continued hearing, the parties
again filed a joint trial management certificate.
(Id.) The “Pretrial Motions” section of
that certificate again lists the contempt motion as a
“matter[] or motion[] [that] should be addressed before
[the] hearing commences.” (Id. at 2.)
At some
point before the continued hearing, and no later than January
17, 2014, Greenfield explained to DeAngelo the difference
between the two types of spousal maintenance (colloquially
known as alimony): contractual and statutory. (ECF No. 72 at
6, ¶ 8.) In particular, Greenfield explained to DeAngelo
that contractual maintenance would survive Silverman's
death, but statutory maintenance (i.e., the form of
maintenance a court could order) would not. (Id.
¶ 9.)
4.
The Permanent Orders Hearing
The
continued permanent orders hearing took place as scheduled on
January 21 and 22, 2014, before Weld County Magistrate Andrea
Koppenhofer. (See, e.g., ECF No. 81-6.) The parties
apparently agree that Magistrate Koppenhofer did not
hear evidence regarding the contempt citation, but, for
reasons this Court cannot fathom, neither side explains why.
The Court has reviewed the report of attorney Kathleen Hogan,
whom DeAngelo has designated as her expert on the standard of
care in divorce proceedings. (ECF No. 72-36.) Hogan's
account of the permanent orders hearing suggests that
Magistrate Koppenhofer had forgotten about, or was unaware
of, a minute order (not in the record) specifically
designating the permanent orders hearing as the forum to hear
evidence on the contempt citation. (Id. at
10-11.)[3] Hogan also faults Greenfield for not
bringing that minute order to Magistrate Koppenhofer's
attention. (Id. at 11.) Hogan faults Greenfield for
misunderstanding the nature of the contempt he was seeking,
which in some way prompted Magistrate Koppenhofer to direct
the parties to address contempt at a later hearing.
(Id. at 10-11.)
Magistrate
Koppenhofer issued no orders at the end of the permanent
orders hearing. (See ECF No. 81-6 at 3.) She instead
called for written closing arguments, which she expected to
include a proposal for a promissory note that would
effectuate whatever division of marital property she would
ultimately order. (Id.)
Greenfield
submitted his written closing argument on January 31, 2014.
(ECF No. 72-7.) That document did not propose terms for a
promissory note, nor did Greenfield at any other time provide
Magistrate Koppenhofer with proposed terms for a promissory
note. (ECF No. 81 at 13, ¶ 21.) Greenfield did raise the
contempt issue, however, stating that DeAngelo would withdraw
the contempt motion if the permanent orders included a
requirement that Silverman pay DeAngelo $41, 000 “to
represent one-half of [the joint bank] account.” (ECF
No. 72-7 at 4; see also id. at 2 (same).)
Greenfield
further argued for two alternatives as to an equitable
distribution of the marital property. The first alternative
was an equalization payment from Silverman to DeAngelo of $1,
183, 114. (Id. at 2.) This would have equalized the
parties' assets but not their substantial tax debts,
calculated by DeAngelo at $450, 307 and by Silverman at $484,
375. (See ECF No. 72-8 at 3-4.) Greenfield thus
proposed a second alternative in the event that Magistrate
Koppenhofer decided to distribute the tax debts evenly. In
that case, Greenfield said, a payment from Silverman to
DeAngelo of $958, 010.50 would “equalize the net assets
of the parties.” (ECF No. 72-7 at 2.)
B.
The Magistrate's Permanent Orders
Magistrate
Koppenhofer issued her permanent orders on February 28, 2014.
(ECF No. 72-8.) In terms of dividing the marital estate, she
adopted Greenfield's first alternative, allocating all
tax debt to Silverman and ordering him to make an
equalization payment to DeAngelo of $1, 183, 114.
(Id. at 3-4.) She also awarded the equity in a
Nevada residence to DeAngelo, which the parties represent to
be $12, 000. (Id. at 2.)[4]
Regarding
the $1, 183, 114 equalization payment, Magistrate Koppenhofer
ordered Silverman “to execute a promissory note to
[DeAngelo] in that amount, with payments to be made monthly
in the amount of $3, 000. Interest shall be annual at 8%.
[DeAngelo] is permitted to collateralize the outstanding debt
if she so chooses.” (Id. at 4.) Concerning
spousal maintenance, she ordered Silverman to pay DeAngelo
“$10, 000 per month for 5.5 years or 65 months.”
(Id. at 6.) And, “to secure the maintenance
and the distribution of property payment, ” Magistrate
Koppenhofer ordered Silverman to maintain a $100, 000 life
insurance policy with DeAngelo as sole beneficiary.
(Id. at 7.) As for a request from Greenfield that
Silverman be required to pay DeAngelo's attorneys'
fees, she ordered further briefing. (Id. at 8.)
Finally,
Magistrate Koppenhofer concluded with a warning about
availability of an appeal: “This order was entered by a
magistrate in a hearing to which consent was necessary; the
parties consented when they scheduled the hearing in the
magistrate's division. Any appeal of this ruling must be
taken to the Colorado Court of Appeals pursuant to C.R.M.
7(b).” (Id.) The cited rule-from the Colorado
Rules for Magistrates-says that, in consent-required cases,
the magistrate's judgment is treated as if from a
district judge and “shall be appealed pursuant to the
Colorado Rules of Appellate Procedure in the same manner as
an order or judgment of a district court.” In other
words, the aggrieved party may not request a district judge
to review the magistrate's order.
C.
Divorce Proceedings, and Related Proceedings, After Entry of
Permanent Orders
1.
Errors Discovered & Appeals Discussed
“Shortly afterwards, ” DeAngelo met with
Greenfield to discuss the problem inherent in the requirement
that Silverman pay $1, 183, 114 to DeAngelo in monthly
installments of $3, 000 at 8% annual interest. (ECF No. 72 at
8, ¶ 12.) Specifically, at 8% interest, $3, 000 per
month ($36, 000/year) would not cover the accruing interest
($94, 659.12/year), much less the required principal
payments. (Id.)
Whether
in this same conversation or sometime later, DeAngelo raised
with Greenfield the possibility of an appeal, and Greenfield
said that she would need to retain different counsel.
(Id. at 9, ¶ 14.) According to DeAngelo,
Greenfield specifically advised that her only option was an
appeal to the Colorado Court of Appeals in Denver and that
she would therefore need to hire a Denver lawyer.
(Id.) DeAngelo believed she could not afford that
course of action. (Id. ¶ 15; ECF No. 81 at 5,
¶ 15; ECF No. 85 at 4, ¶ 15.)
DeAngelo
claims that Greenfield was wrong to advise that an appeal to
the Colorado Court of Appeals was DeAngelo's only option.
She points to Colorado Rule for Magistrates 5(a), which
states, in relevant part, “Except for correction of
clerical errors pursuant to [Colorado Rule of Civil
Procedure] 60(a), a magistrate has no authority to consider a
petition for rehearing.” (See ECF No. 81 at
15, ¶¶ 27, 29.) The cross-referenced Rule 60(a)
reads, in relevant part, “Clerical mistakes in
judgments, orders, or other parts of the record and errors
therein arising from oversight or omission may be corrected
by the court at any time of its own initiative or on the
motion of any party and after such notice, if any, as the
court orders.” Accordingly, DeAngelo claims that
Greenfield could have moved Magistrate Koppenhofer to
reconsider her permanent orders under the theory that they
contained
clerical errors, including omissions of the date or means by
which Plaintiff ever would or could receive the principal of
the property division, whether the monthly payment was
intended to be credited towards the principal, the interest
or a combination thereof, and a reservation of jurisdiction
over the terms of any promissory note issued.
(Id. ¶ 29.) Greenfield denies that he could
have asked Magistrate Koppenhofer to revisit her orders under
a clerical error theory. (ECF No. 85 at 9, ¶ 29.) The
Court will address this denial below in Part VI.C.3.
2.
Further Proceedings in Weld County and Silverman's
Death
Regardless,
proceedings continued before Magistrate Koppenhofer on issues
not yet resolved. On March 20, 2014, Greenfield filed a
notice to set a hearing on the contempt citation. (ECF No. 72
at 10, ¶ 18.) On June 24, 2014, Magistrate Koppenhofer
denied DeAngelo's request to require Silverman to pay her
attorneys' fees, finding it would be “fair,
equitable, and appropriate to order each party to pay their
own remaining attorney fees.” (ECF No. 72-9 at 2.) On
December 15, 2014, she dismissed the contempt citation
without prejudice
[i]n light of [Silverman's] failing health . . . and his
inability to appear in person for a remedial and punitive
contempt hearing, or even testify at such and based upon the
Court's many attempts to reset this matter and the need
for the Court to have [Silverman] present for a hearing on
punitive contempt . . . .
(ECF No. 72-11 at 1.) On January 5, 2015, Greenfield
petitioned for district judge review of that order. (ECF No.
72-12.)[5] But Silverman died on January 30, 2015.
(ECF No. 72 at 10, ¶ 21.) By that time, he had made
eleven maintenance payments of $10, 000 each. (ECF No. 81 at
15, ¶ 31.) His death terminated DeAngelo's rights to
those payments. (Id.)[6]
On
March 24, 2015, DeAngelo replaced Greenfield with a new
attorney, Jessica Catlin. (ECF No. 72 at 10, ¶ 22.)
Three days later, a Weld County district judge ruled on the
January 5 petition for review of Magistrate Koppenhofer's
order dismissing the contempt citation. (ECF No. 72-16.) The
district judge held that the magistrate erred in
dismiss[ing] the contempt citation on the court's own
motion. However, given the Husband's subsequent death,
the issue of contempt is now moot, except for the request by
the Wife concerning her attorney's fees associated with
seeking compliance by the Husband with the trial court's
prior orders. The Wife's request for attorney fee's
[sic] shall be addressed by the trial court upon
remand, once the party representing the Husband's estate
is joined as a necessary party to this action.
(Id. at 2.) Greenfield and DeAngelo both
characterize this ruling from the district judge as a
“dismissal” of the contempt citation, although
DeAngelo adds that it was “without prejudice.”
(ECF No. 72 at 10, ¶ 24; ECF No. 81 at 6, ¶ 24.)
Catlin, DeAngelo's new attorney, did not appeal from this
order. (Id.)
3.
Moving for Relief from Judgment, Moving for Transfer to
Boulder County, and DeAngelo's Remarriage
On
April 2, 2015, Catlin moved for relief from Magistrate
Koppenhofer's permanent orders under Colorado Rule of
Civil Procedure 60(b)(5) (“the court may relieve a
party or his legal representative from a final judgment,
order, or proceeding for . . . any other reason justifying
relief from the operation of the judgment”). (ECF No.
72-17.) She pointed out that the payment terms of the marital
property equalization payment were nonsensical, and asked for
a modification that effected full payment within three to
five years. (Id. ¶¶ 5, 14.)
However,
also on April 2, 2015, Catlin and counsel for Silverman's
estate jointly moved to change venue to Boulder County
District Court because Silverman's probate case was
pending in that court, his personal representative lived in
Boulder, all counsel lived in Boulder, and DeAngelo no longer
lived in Weld County. (ECF No. 72-18.) Magistrate Koppenhofer
denied that motion, considering herself in the best position
to rule on still-pending matters. (ECF No. 72-19.)
DeAngelo
remarried on April 6, 2015. (ECF No. 72 at 11, ¶ 28.)
On May
7, 2015, Catlin and counsel for Silverman's estate
jointly moved for district judge review of Magistrate
Koppenhofer's ruling on the motion to transfer. (ECF No.
72-20.) On May 22, 2015, the district judge overturned that
ruling and transferred the proceeding to Boulder County
District Court. (ECF No. 72-21.)
4.
Proceedings in Boulder County
On
August 4, 2015, the Boulder County District Court denied
DeAngelo's motion for Rule 60(b)(5) relief. (ECF No.
72-22.) The court reasoned that the “mathematical
anomaly” regarding the marital property equalization
payment was better characterized as “mistake,
inadvertence, surprise, or excusable neglect” under
Colorado Rule of Civil Procedure 60(b)(1), and the time for
bringing a Rule 60(b)(1) motion had expired. (Id. at
6-7.)
The
next day, Catlin, on DeAngelo's behalf, moved for Rule
60(a) relief. (ECF No. 72-23.) As previously noted, Rule
60(a) allows the court to correct “[c]lerical mistakes
in judgments, orders, or other parts of the record and errors
therein arising from oversight or omission . . . at any
time.” Catlin noted the Boulder court's
“mathematical anomaly” reasoning but argued that
“mistake, inadvertence, surprise, or excusable
neglect”-i.e., error apparently attributable
to one of the parties-was not the proper lens to view the
problem. (ECF No. 72-23 ¶ 5.) Rather, “to the best
of counsel's knowledge, the ‘mathematical
anomaly' was the product of the Magistrate's own
doing.” (Id.) Catlin continued, “The
failure of the magistrate to mathematically effectuate her
division of property should not be borne by [DeAngelo], and
the error must be corrected under C.R.C.P. 60(a).”
(Id. ¶ 9.)
On
August 12, 2015, Silverman's estate responded to the new
motion. (ECF No. 81-4.) The estate argued that Rule 60(a)
cannot be used to obtain relief already denied under Rule
60(b)(5); and, in any event, the motion did not establish an
instance of clerical error because Magistrate
Koppenhofer's intent was unclear and so it was not
possible to conclude that the words of her order deviated
from her intent. (Id.)
On
August 13, 2015, the court denied the Rule 60(a) motion in a
short order stating that the court adopted Silverman's
estate's response arguments. (ECF No. 72-24.)
D.
Proceedings in the Colorado Court of Appeals
1.
DeAngelo's Appellate Arguments
On
September 17, 2015, DeAngelo appealed the denial of the two
Rule 60 motions to the Colorado Court of Appeals. (ECF No.
72-25.) Referring to the order denying Rule 60(b)(5) relief,
she argued to the appellate court that “[t]he Trial
Court's effort to shoe horn the Magistrate's clerical
error into a ‘mistake' [under Rule 60(b)(1))] which
was required to be raised within [an already-expired] time
frame . . . was an abuse of discretion.” (ECF No. 72-26
at 30.) This was so she said, because Rule 60(b)(1) addresses
mistakes committed by the parties, not the judge, and a
mistake committed by a party was not at issue: “The
failure of the Magistrate to effectuate a payment schedule
(or, indeed understand algebraic concepts) was not a
‘mistake,' ‘inadvertence' or
‘neglect' on the part of [DeAngelo], nor that of
her former counsel.” (Id.) DeAngelo
alternatively argued that, even assuming she “was
somehow remiss in not catching the Magistrate's
mathematical error, C.R.C.P. 60(a)'s purpose is to allow
the Court to correct its own errors and
those of a party.” (Id. at 24 (emphasis in
original).)
2.
The Appellate Decision
On
November 3, 2016, the Colorado Court of Appeals resolved the
appeal in an unpublished disposition. (ECF No.
72-27.)[7] The court was convinced that the record
evinced Magistrate Koppenhofer's “inten[t] to
divide the marital property equally as both husband and wife
had requested.” (Id. ¶ 16.) The question
of her former attorney's (Greenfield's) potential
error did not matter because DeAngelo “did not argue
for relief based on her counsel's inaction, but rather
because the judgment does not reflect the court's intent
in dividing the marital property.” (Id. ¶
17.) Noting its prior interpretation that Rule 60(a)
“applies to clerical mistakes made not only by a clerk,
but also to mistakes made by the court and the parties,
” Reisbeck, LLC v. Levis, 342 P.3d 603, 605
(Colo.App. 2014), the Court of Appeals concluded that Rule
60(a) relief was appropriate because Magistrate Koppenhofer
intended an equal distribution of marital property but, for
unexplained reasons, created payment terms that could never
lead to equal distribution. (Id. ¶¶ 12,
16-17.) The court also concluded that Rule 60(b)(5) was an
available source of relief. (Id. ¶¶
18-22.) “Thus, ” the court said, “we remand
the case for the district court to reconsider payment terms
for the $1, 183, 114 property equalization payment.”
(Id. ¶ 23.)
The
court also addressed issues related to the contempt
proceeding. The court held that reopening those proceedings
on remand was not required because the record did not support
the notion that Magistrate Koppenhofer “intended to
divide [the $82, 000] yet failed to do so.”
(Id. ¶ 25.) Moreover, Greenfield had not argued
that Silverman dissipated the marital estate in anticipation
of dissolution, but only that he had violated the automatic
preliminary injunction. (Id. ¶ 26.)
Finally,
the appellate court directed the district court on remand
“to determine [DeAngelo's] request” for
attorneys' fees incurred on appeal. (Id. ¶
31.)
E.
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