?? On an appeal from a Trial Court Order granting a Motion to Dismiss, a lopsided majority of the Mississippi Court of Appeals, en banc, reversed the dismissal and reinstated the Complaint in? Great American E & S Insurance Co. v. Quintairos, Prieto, Wood & Boyer, P.A., 2012 WL 266858 (Ct. App. Miss. January 31, 2012, Download Great American E & S Insurance Co. v. Quintairos, Prieto, Wood & Boyer, P.A. (Ct. App. Miss. January 31, 2012)(en banc) PUBLIC ACCESS.? (The Defendant in this case is a Florida-based Law Firm.)
?? The Court of Appeals' original opinion was modified and withdrawn en banc in a decision stating that rehearing was "denied".? In that case, the Plaintiff was an Umbrella Carrier and the Defendant was a law firm retained by the Primary Carrier to defend their mutual Policyholder.??? After settling the subject underlying lawsuit for an undisclosed sum, see id. at *2 ? 15 (there were three other cases alleged by the Plaintiff in which the Plaintiff was allegedly damaged by the same law firm's conduct of the defense, in addition to the underlying case at issue in this appeal, id. at *3 ? 16), the Umbrella Carrier-Plaintiff sued the Defendant Defense Counsel on Counts of alleged Negligent Misrepresentation, Legal Malpractice, various Negligence Counts, and Equitable Subrogation.
?? Parenthetically, according to the en banc majority opinion, the Umbrella Carrier settled the subject underlying case after learning, among other things,?"that none of the Quintairos partners or trial attorneys had been admitted to practice law in Mississippi," and "that Quintairos had not retained local counsel".? Id. at *2 ? 14.
?? The en banc Court reversed the Trial Court's Order of dismissal on each of these Counts.
?? The Negligent Misrepresentation claim was supported, in the majority's view, by allegations that the Defense Counsel misinformed the Umbrella Carrier in evaluating the likely damages in the event of a Judgment against the Insured:
Thus, Great American claims: Quintarios [sic] had falsely represented that the settlement value of the cases was worth substantially less than the amount that would implicate Great American's coverage; Great American relied on the false representations; Great American had no reason to take action to protect itself; and Great American was damaged as a result of the misrepresentations.
Id. at *4 ? 25.? "Accordingly, this Court finds that there is a set of facts that would entitle Great America [the Umbrella Carrier-Plaintiff in this case] to relief."? Id. at *4? ? 26.
?? Great American's separately stated claim for Legal Malpractice also stated a claim or cause of action, in the eyes of the Court on rehearing en banc.? This ruling seems to have been based on the same common nucleus of alleged operative facts, so to speak:
?? ? 34. We conclude that if Great American was provided defense counsel's evaluation of the ?settlement value? of the plaintiff's lawsuit, as is alleged in Great American's amended complaint, such information would appear to be considered the rendition of professional legal services by a lawyer.
* * *
Therefore, we find that the allegation in the amended complaint that defense counsel, including Quintaros [sic] provided attorney-client privileged communications to Great American may provide a set of facts upon which Great American may be able to prove that an attorney-client relationship existed.
Id. at *6 ? 34.? [Emphasis by the Court of Appeals of Mississippi.]
?? Author's Note at this point in the post:? There are few if any cases in which Defense Counsel will not provide to the Insured's Excess or Umbrella Carrier, her, his, or their evaluations of both the liability and damages exposure faced by the Insured Defendant.? As a direct result, the implications of this particular ruling in this case are huge.
?? The en banc Court of Appeals also held that even though the amended complaint at bar contained claims that were not dismissed by the Trial Court's Order, which were alleged "for negligence, gross negligence, and negligent supervision," still the Trial Court's Judgment was reversed and the Defendant law firm's motion to dismiss should have been denied as to these claims, too.? Id. at *9 - *10 ??? 43-48.
?? Finally, the Plaintiff Umbrella Carrier also stated a legally cognizable claim against the Defendant Law Firm for Equitable Subrogation, the Court held.? Since the Plaintiff settled on behalf of its Insured, the Court held that the Plaintiff is equitably entitled in this case of first impression under Mississippi law, to step into the shoes of its Insured and "should be allowed to go forward with its claim in the insured's place."? Id. at *12 ? 55.
?? The holding in this en banc decision is on the cutting edge of an emerging issue in Insurance jurisprudence:? Whether an Excess or Umbrella Insurer can legally assert claims "against the law firm that was hired to defend the insured."? Id. at *1 ? 2.? In answering this question in the affirmative, the Court of Appeals placed Mississippi in the ranks of those jurisdictions in which Defense Counsel can be sued for 'malpractice' by Excess or Umbrella Insurers of the Defendants (Insureds) which the lawyers have been retained to defend.? See generally Dennis J. Wall, Litigation and Prevention of Insurer Bad Faith ?? 3:70 (Requirements for Fulfillment or Enforcement of Good Faith Duty:? Conduct of Defense -- Informing the Insured: ?Counsel") and 3:71 ("--Negligence of Trial Counsel") (West Publishing Co. Third Edition 2011).
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