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Firor v. Lydon

Court of Appeals of Ohio, First District, Hamilton

April 27, 2018

RANDALL FIROR, Individually and as Executor of the Estate of Hugh V. Firor, M.D.,
DEBORAH R. LYDON, Defendant-Appellee, THOMAS FIROR, M.D., Individually, DAVID HOMER, as Successor Trustee of the Hugh V. Firor, M.D., Revocable Trust, Plaintiffs-Counterclaim Defendants/Appellants, and RANDALL FIROR, and THOMAS FIROR, M.D., as Co-Trustees of the Betty Bourdon Firor Revocable Trust, Plaintiffs-Appellants, and DINSMORE & SHOHL LLP, Defendant-Counterclaim Plaintiff/Appellee.

          Civil Appeal From: Hamilton County Court of Common Pleas TRIAL NO. A-1505916

          F. Harrison Green Co. LPA, and F. Harrison Green, for Plaintiffs-Counterclaim Defendants/Appellants,

          Pinales Stachler Young Burrell & Crouse, Thomas L. Stachler and Shawn M. Young, for Defendant-Appellee and Defendant-Counterclaim Plaintiff/Appellee.


          Cunningham, Presiding Judge.

         {¶1} Plaintiffs-counterclaim defendants/appellants, the sons of Hugh V. Firor, M.D., ("Dr. Firor") Thomas Firor, M.D., ("Thomas") and Randall Firor ("Randall"), in their individual and fiduciary capacities to their father's estate and trust and for their mother's trust, and David Homer, as successor trustee to Dr. Firor's revocable trust, for ease of discussion collectively referred to as "the Firors, " engaged the legal services of defendant-appellee attorney Deborah R. Lydon and her law firm defendant-counterclaim plaintiff/appellee, Dinsmore & Shohl LLP, ("Dinsmore")to recover funds that Thomas and Randall's sister, Nancy Kibbee, had fraudulently taken from their father. The Firors ultimately sued Lydon and Dinsmore for legal malpractice, and Dinsmore counterclaimed for unpaid legal fees.[1] The trial court granted Lydon and Dinsmore's motion for summary judgment on the Firors' claims and on Dinsmore's counterclaims.

         {¶2} Because the Firors' legal-malpractice claim was barred by the statute of limitations, and because no genuine issues of material fact remain as to whether $161, 423.83 in fees remain uncollected for Lydon and Dinsmore's legal services in the Kibbee litigation, we affirm the trial court's judgment.

         The Kibbee Litigation

         {¶3} Thomas and Randall sought Lydon's services based on their concerns that their sister had stolen millions of dollars from their father, which should have been distributed equally among Thomas, Randall, and Nancy upon Dr. Firor's death. Thomas and Randall learned that Nancy, with the assistance of her counsel, had applied to the Hamilton County Probate Court for relief from administration of Dr. Firor's estate, claiming that the estate was worth $6, 000 and not the $1 to $3 million that Thomas and Randall claimed should have been in the estate. Thomas and Randall entered into written agreements of engagement with Lydon and Dinsmore in which they agreed to pay legal fees as billed at a blended rate of $295 per hour.

         {¶4} Lydon's investigation revealed that Nancy had taken control of her father's personal accounts, his retirement funds, funds in the Hugh V. Firor, M.D., Revocable Trust, their late mother's trust (the Betty Bourdon Firor Revocable Trust), and other assets. Lydon was able to defend some of Dr. Firor's assets for Thomas and Randall, including defeating Nancy's requests for relief from administration and appointment as executor of her father's estate, having Thomas and Randall appointed as cotrustees of their mother's trust, and securing Homer's appointment as successor trustee of Dr. Firor's trust. Homer, a licensed attorney, is Thomas' best friend. The Firors retained Lydon and Dinsmore to represent them in their various fiduciary capacities, in addition to pursuing their litigation against Kibbee.

         {¶5} Throughout the litigation, Thomas and Randall had told Lydon that one of their primary goals in the Kibbee litigation was to uncover the truth regarding Kibbee's alienation of them from their father during the last years of his life. Kibbee had prevented the two from seeing their father. Thomas and Randall believed that Kibbee had unduly influenced their father and had transferred most of his funds to herself while she controlled his affairs.

         {¶6} At the outset of the litigation, Lydon had explained to the Firors the difficulties in collecting their father's lost assets. In February 2013, she told them in an email that if Kibbee had taken the funds and had "spent [them] all, and declared bankruptcy at some point, it could be hard to get back from her." Thomas and Randall nonetheless rejected potential settlements with Kibbee and opted to proceed with litigation.

         {¶7} By mid-2013, Lydon had been successful in recovering $80, 000 of their father's retirement accounts, and $55, 000 that Kibbee had taken from their father's trust. In June 2013, Lydon and Dinsmore filed an action against Kibbee and her attorney in Hamilton County Common Pleas Court. Following extensive discovery and pretrial practice, in 2014, Kibbee's attorney agreed to pay the limits of her insurance coverage-$100, 000-to Thomas and Randall to settle their claim. They agreed to allocate the settlement funds against the attorney fees incurred in the litigation. In connection with the settlement, the Hamilton County Probate Court approved all fees incurred by Lydon and submitted by Randall as the successor trustee of his father's trust.

         {¶8} Over the course of the litigation, Lydon and Dinsmore conducted extensive discovery proceedings, reviewed over 40, 000 documents, exchanged over 3, 000 emails with their clients, and engaged in litigation in several venues. Lydon and Dinsmore achieved significant results for the Firors in taking control over their father's assets from Kibbee and in discovering proof of her theft from and undue influence over Dr. Firor. As a result of her efforts, Lydon obtained over $235, 000 for the Firors, a piece of real estate valued at $7, 000, access to a judgment over $43, 000, a contempt judgment against Kibbee for $6, 300, and access to over $6, 000 for the Betty Firor trust.

         {¶9} But Lydon and Dinsmore had also collected approximately $180, 000 in fees and expenses from the Firors. In June 2014, the Firors stopped paying the regularly submitted invoices for services rendered.

         {¶10} On July 7, 2014, the event that Lydon had warned Thomas and Randall of occurred. Kibbee filed for bankruptcy protection and received an automatic stay from any litigation filed against her. The next day, Lydon informed the Firors that the bankruptcy stay meant that Dinsmore's work on their behalf in the litigation to recover assets was essentially over. She also told the Firors that Dinsmore would not take on any additional matters unless they could bring their outstanding balances up to date.

         The Firors' Claims and Dinsmore's Counterclaims

         {¶11} On November 2, 2015, the Firors filed a verified complaint, ultimately amended, against Lydon and Dinsmore, in which they alleged that she and her firm had billed them for work in excess of an amount, not specified at the time of engagement, that they claimed they had told Lydon not to exceed. They also claimed that Lydon and Dinsmore had been negligent in failing to warn them of the difficulty of collecting Kibbee's assets, particularly if she declared bankruptcy, and in failing to keep them informed of the spiraling costs of the Kibbee litigation. The amended verified complaint was filed on December 28, 2015. Attached to the complaint was a tolling agreement signed by the parties. The agreement suspended the running of the limitations period for a period of days in mid-2015. One month later, Thomas, Randall, and Homer, in their individual and fiduciary capacities, each filed sworn verifications that the statements made in the amended verified complaint were true.

         {¶12} Lydon and Dinsmore answered, and Dinsmore filed a counterclaim seeking $161, 423.83 in unpaid legal bills. In September 2016, Lydon and Dinsmore moved for summary judgment on the Firors' claims, and Dinsmore moved for summary judgment on its counterclaims. Dinsmore's motion was ultimately supported by three affidavits submitted by Lydon, each with numerous exhibits attached, describing her actions and her communications with the Firors. Also attached to the motion was the affidavit of Victor A. Walton, an experienced Cincinnati litigation attorney. He stated that based upon his experience in the Cincinnati legal community and his review of Lydon's affidavit and attached materials, including the billing records, "and the related pleadings in the underlying litigation matters involving Kibbee, " the legal fees of $350, 000 were fair, reasonable, and not excessive. Having reviewed the extensive email and letter records of communications between Lydon and the Firors, Walton also stated that in his opinion Lydon had not breached any duty of communication with her clients.

         {¶13} The Firors responded with a memorandum in opposition to the summary-judgment motion. Attached to the memorandum was a 22-page report identified as Exhibit A. The report had been prepared by the Firors' expert witness, Columbus attorney Jonathan Coughlin. The report was signed, but was not sworn to or certified, and was incorporated into an attached affidavit. In the report, Coughlin had given his opinion about whether Lydon had breached the standard of care to her clients. That opinion was also contained in Coughlin's deposition testimony, filed with the trial court on July 20, 2016.

         {¶14} On December 1, 2016, the trial court entered summary judgment in favor of Lydon and Dinsmore on the Firors' claims. The court stated that the Firors had failed to produce "expert testimony showing a specific duty to advise a client as to the collectability of individual defendants, [or] how [Lydon and Dinsmore] had breached that duty." The court also entered summary judgment for Dinsmore on its counterclaims for unpaid fees. The court's entry of judgment became final and appealable in March 2017, when the court fully disposed of the counterclaims. The Firors appealed.

         The Firors' Legal-Malpractice Claims Are Time-Barred

         {¶15} In their first assignment of error, the Firors allege that the trial court erred in granting summary judgment on claims raised in their amended verified complaint. They argue both that their claims against Lydon and Dinsmore were not barred by the statute of limitations, ...

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