Monday, April 26, 2021

Malpractice Arbitration Upheld In Wyoming

The Wyoming Supreme Court has held that 

We conclude the district court: erred when it failed to stay the malpractice action as required by the Wyoming and Utah Uniform Arbitration Acts; properly limited its review to whether the arbitration provision was enforceable; and correctly ruled on the enforceability of the arbitration provision. We therefore affirm the district court’s order compelling arbitration, but reverse its dismissal of the action and remand with instructions to stay the proceedings pending arbitration.

The attorney had represented three beneficiaries to a trust

Grimmer represented Ms. Inman, Patterson, and Daisha over the next three years, including in a probate action and a civil action in Wyoming against Daralee, challenging her depletion of trust assets. Grimmer also grew involved in Ms. Inman’s life, helping her find employment, arranging educational tutors, and assisting her with travel arrangements, health care, and buying a car. After she turned 18 in 2015, Ms. Inman signed a new engagement agreement at Grimmer’s request. The new agreement contained an arbitration provision. Grimmer also continued to represent Patterson and Daisha.

Ms. Inman’s and Patterson’s interests soon diverged. By 2017, Ms. Inman wished to end the litigation against Daralee but Patterson did not. In 2016 and 2017, Grimmer helped Patterson attempt to buy real property from the WPI Trust. During this time, Grimmer also drew up and had Ms. Inman sign documents regarding the real property and the trust litigation that benefitted Patterson. Ms. Inman claims Grimmer told her these documents would help end the litigation against Daralee, and did not explain how they might adversely effect her interests. Ms. Inman fired Grimmer in September 2017. Grimmer continued to represent Patterson in matters involving Ms. Inman.

The court found the arbitration provision enforceable

The provision clearly covered malpractice claims, and plainly listed the rights Ms. Inman relinquished when she signed the agreement. In the end, the law and rules of professional conduct permit attorneys to include arbitration provisions that encompass malpractice claims in their engagement agreements; Ms. Inman does not claim the arbitration provision is harmful to the public as whole; Grimmer had no duty under Utah law or rules of professional conduct to verbally explain the provision to her; and the provision as written was adequate to inform her of its scope and effect. Under these circumstances, Ms. Inman has not convinced us that Utah courts would invalidate the arbitration provision on public policy grounds.

(Mike Frisch)

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