Drinker Biddle Is Put Back on Defense Of Claim It Fostered a Bad Settlement
A New Jersey appeals court on Tuesday reinstated a claim that 630-lawyer Drinker Biddle committed malpractice that forced a litigation client to make a bad settlement and lose hundreds of thousands of dollars.
The judges also set aside a trial judge's ruling last year that the client, Verdure Asset Corp. of New York, owed the firm $240,000 for work its Princeton office did on the troubled case in 2003.
Instead of dismissing the malpractice suit on summary judgment, a Mercer County judge should have let a jury decide, the appeals panel ruled in an unpublished opinion, Verdure Asset Corp. v. Wheeler, A-3084-06.
Lead defendant Jonathan Wheeler, a Cherry Hill solo who also represented Verdure, won dismissal in 2006 and is no longer part of the case.
Verdure turned to Wheeler in 2000 to sue two environmental companies whose work removing oil tanks allegedly devalued a 47-acre property Verdure owned in Hamilton Township.
The companies' poor work caused so much damage, a truck repair building on the property had to be demolished, devaluing the property's worth when Verdure sold it.
On the eve of trial in 2003, when Wheeler failed to get an expert to support the claim, and the case appeared to be in jeopardy, Verdure hired Drinker Biddle's Christine Baker.
Baker, an experienced litigator and a member of the American Bar Association House of Delegates, was selected by NJ Biz magazine as one of the Best 50 Women in Business in the state in 2006. She is now vice president of litigation at Realogy Corp. in Parsippany.
The judge in the property case gave Baker time to find a replacement expert to opine about the costs Verdure would have incurred to repair the damaged building.
But her expert's opinion discussed the replacement cost of the building - not the repair cost - and the judge signaled he was inclined to disallow the report.
Before he ruled, Verdure agreed to a settlement. It dropped its claims and paid the environmental companies $65,000 of their $204,000 bills.
Verdure insists that Baker was negligent for not obtaining an expert report that supported the claim for repair costs. But the defense says there wasn't enough evidence to back such a report, and defense evidence in the malpractice case suggested Verdure suffered no damages from having to settle.
Superior Court Judge Paul Koenig agreed with the defense and dismissed the malpractice claim in February 2007. He said Baker, coming into the case just before trial, did the best she could.
"I take the position it is a reasonable approach," Koenig said of her work. "It's not the only approach that could have been taken, but if I take the position it's a reasonable approach, isn't that the end of your story?"
Verdure's malpractice lawyer, Princeton solo Glenn Bergenfield, disagreed, and on Tuesday, so did Appellate Division Judges Stephen Skillman, Joseph Yannotti and Laura LeWinn. They said the case isn't ripe for summary judgment.
Although Baker and the firm assert there was insufficient evidence to make an estimation of repair costs, experts in the malpractice action did provide such estimates, the court said. The plaintiffs also have a malpractice expert's opinion that Baker erred.
"We are convinced that this evidence is sufficient to raise a genuine interest of material fact as to whether Baker was negligent in her handling of the lawsuit," the appeals court said.
The court also rejected the defense argument that Verdure suffered no loss. The $1.4 million it received in a sale of the property was all it would have received had the building been repaired, the defense argued.
Even so, that issue can't be resolved as a matter of law because Verdure's evidence suggests the parcel - though it did sell for a profit - was worth nearly twice as much with the building as without it.
There was some good news for the defense. Verdure had asked for summary judgment on liability, and the court ruled Koenig had been right to deny the request.
Baker's defense counsel, Marshall Bilder of Sterns & Weinroth in Trenton, and Jonathan Epstein, managing partner of Drinker Biddle's Princeton office, did not return calls for comment.