Roseland v. Wentzell, No. A14-1254: Minnesota Court of Appeals Affirms Summary Judgment for Attorney in Legal Malpractice Case

The Minnesota Court of Appeals affirmed the dismissal of a legal malpractice, on the basis that the clients had not provided sufficient evidence to support their claims.  In Roseland v. Wentzell, a couple owned several parcels of farmland, which they had mortgaged to secure a loan from their bank.  They later defaulted on their mortgage payments, and hired an attorney to represent them in bankruptcy proceedings.

The attorney assisted the couple in negotiating a plan to restructure their mortgage with the bank, and prevent them from losing their land.  The plan was initially approved by the bankruptcy court, however, the couple subsequently failed to provide the bank with a signed agreement, and the court dismissed the case.

Consequently, the bank initiated foreclosure proceedings, and purchased the land owners’ property at auction.  The couple could not afford to redeem their land, so their attorney negotiated a refinancing agreement with a group of investors, who ultimately formed a limited liability company (“LLC”), which purchased the mortgage from the bank.  The agreement allowed the couple to remain on their property, as long as they continued to make mortgage payments to the LLC.

The following year, the couple defaulted on their mortgage with the LLC, and the LLC commenced eviction proceedings.  The couple then brought a malpractice action against the attorney, alleging that he (1) failed to reserve rights for the couple under Minnesota’s home owners’ protection laws, which could have stopped the eviction, (2) failed to challenge the bank’s initial foreclosure, and (3) failed to assert a counterclaim against the bank.  The attorney moved for summary judgment, which the lower court granted, and the land owners appealed.

The Appeals Court explained that in a malpractice claim arising from a transactional dispute, the client must prove that but for the attorney’s conduct, he/she would have obtained a more favorable outcome in the underlying transaction.  Applying this standard, the Court ruled that the expert affidavit, which the couple had submitted in opposition to the attorney’s summary judgment motion, failed to adequately describe how the attorney had prevented the land owners from obtaining a more favorable outcome.  Thus, the malpractice claim failed as a matter of law, and summary judgment was appropriate for the attorney.

Decision: Roseland v. Wentzell

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