D. Warren Justice.
lawsuit plaintiffs Carrie Anderson and Deborah Collins are
suing defendants Barry Mills and Hale & Hamlin LLC
(collectively referred to as Mills) for professional
negligence. Before the court is defendants' motion for
procedural history that led to this case arises from a set of
convoluted proceedings that began in the Hancock County
Probate Court and that led to a disputed settlement agreement
followed by further proceedings in the Probate Court, the
Superior Court, and the Law Court in which plaintiffs
challenged the settlement agreement.
docket sheet of the Hancock Probate proceeding, Matter of
Mary Banks, Hancock Probate No. 2005-264, is attached as
Exhibit C to defendants' Statement of Material Facts
dated September 21, 2017 (subsequently cited as
"Defendants' SMF") and reflects that a petition
for a conservatorship was originally filed on her own behalf
by plaintiffs' mother, Mary Banks, in July
2005. When Mary Banks subsequently withdrew her
petition, plaintiffs Anderson and Collins along with two of
their sisters, Liela Johnson and Rebecca York, filed their
own petition for a conservatorship of their mother.
Defendants' SMF ¶ 3 (admitted). In the Hancock
conservatorship proceeding the four sisters were represented
by Attorney Charles Budd from the Rudman Winchell law firm.
four sisters' petition for conservatorship was opposed by
their mother, by their brother, William Banks, and by another
sister, Constance Banks. The various submissions of the
parties demonstrate that in addition to the issues raised by
the petition for conservatorship, the proceedings eventually
involved disputes between the four sisters and their brother
with respect to the disposition of family property.
case was the subject of mediation with Attorney Jerrol
Crouter on September 18, 2009. The events at the mediation
are the subject of considerable dispute. However, it is
undisputed that Anderson and Collins left while the mediation
was still underway, that Attorney Budd thereafter signed a
settlement agreement on their behalf, and that his authority
to have signed that agreement is one of the major issues in
became clear that the settlement agreement was going to be
challenged, Attorney Budd withdrew from representing the four
sisters. Attorney Barry Mills (the defendant in this case)
thereafter appeared on their behalf.
settlement agreement contained a provision that "any
dispute regarding the interpretation, enforcement, or
implementation or execution of this agreement.. . will be
decided by binding arbitration by Jerrol
December 22, 2009 there was a hearing before Probate Judge
Patterson on a motion by William Banks (joined by his mother
and Constance Banks) to require arbitration before Crouter.
The transcript of that hearing is annexed as Exhibit A to
Defendants' SMF. Attorney Mills, on behalf of the four
sisters, opposed that motion, arguing among other things that
Budd had not been authorized to enter the settlement
agreement by Anderson and Collins.
Judge Patterson, in a decision filed January 12, 2010
(Exhibit D to Defendants' SMF) found that before they
left the mediation, Anderson and Collins had informed Crouter
that Budd was authorized to sign an agreement for them and
had not informed Crouter that there were any limitations on
Budd's authority. Judge Patterson therefore found that
Anderson and Collins were parties to the settlement
agreement. January 12, 2010 Probate Court Decision at 2-3.
Patterson also found that the agreement to arbitrate was
severable from the remainder of the settlement agreement and
that all four sisters had agreed to the arbitration
provision. Id. at 4-5. Accordingly, he ordered the
parties to proceed to arbitration before Crouter to resolve
the remaining issues involved in the pending disputes with
respect to the sisters' access to Mary Banks and with
respect to certain property. These issues included whether
the settlement agreement was illusory and whether it had been
repudiated by William and Constance Banks.
Mills recommended that his clients appeal from the decision
of the Probate Court, and the probate docket sheet reflects
that such an appeal was filed. Plaintiffs' SAMF ¶
137; Probate Docket sheet entry for March 5, 2010. According
to the Probate Court docket sheet, an order dismissing the
appeal (presumably as interlocutory) was filed on March 31,
before Crouter was held on March 30, 2010. Defendants'
SMF ¶ 29 (admitted). An arbitration decision was
rendered on April 5, 2010 (Exhibit E to Defendants' SMF).
The arbitration decision was adverse to the four sisters.
Defendants' SMF ¶ 31. The issue of whether Budd had
been authorized to enter the settlement agreement was not
addressed in the arbitration decision and, having been
addressed in the January 12, 2010 Probate Court decision, was
not raised before the arbitrator.
25, 2010 Anderson and Collins, joined by their sisters
Johnson and York and represented by Attorney Mills, commenced
an action in the Hancock County Superior Court seeking
declaratory relief that the September 18, 2009 settlement
agreement resulting from the mediation was invalid. The
docket record in the Superior Court proceeding,
ELLSC-CV-2010-19, is annexed as Exhibit F to Defendants'
SMF. The four sisters' motion to vacate the arbitration
award was denied by Superior Court Justice Kevin Cuddy in a
decision filed February 2, 2011 and annexed as Exhibit G to
summary judgment record indicates that the issue of
Budd's authority to sign the settlement agreement on
behalf of Anderson and Collins was not raised by Attorney
Mills in the Superior Court, and that issue was not addressed
in the Superior Court's decision. Justice Cuddy did
address what he characterized as the four sisters' claim
that they had been compelled to arbitrate by the Probate
Court and should not be bound by an arbitration award that
they alleged was a nullity. Justice Cuddy ruled that
jurisdiction over motions to stay arbitration lies with the
Superior Court, not the Probate Court and that, having not
sought such relief, the four sisters had voluntarily
submitted to arbitration. He also stated, "The evidence
persuades the Court that by executing their Settlement
Agreement, Plaintiffs had already voluntarily agreed to
arbitrate before Mr. Crouter." February 2, 2011 Superior
Court decision at 3.
Cuddy ruled that Crouter as arbitrator had the authority to
determine of the settlement agreement was enforceable and had
not exceeded his authority under 14 M.R.S. § 5938(1)(C).
Id. at 5-7. In a footnote, he concluded that the
four sisters' arguments that the settlement agreement
violated the statute of frauds, was illusory, and was the
produce of mutual mistake had been decided adversely to them
by the arbitrator and were res judicata. Id. at 6
n.4. Finally, Justice Cuddy ruled that the settlement
agreement had not been procured by undue means under 14
M.R.S. § 5938(1)(A) and that the arbitration award had
not been the product of bias on the part of the arbitrator
under 14 M.R.S. § 5938(1)(B). Id. at 8.
Cuddy therefore denied the four sisters' motion to vacate
the arbitration award and granted William Banks's motion
to dismiss. On February 25, 2011, Justice Cuddy modified his
order to add a sentence that the arbitration award was
confirmed. Defendants' SMF ¶ 36 (admitted).
four sisters, represented by Attorney Mills, then appealed to
the Law Court, which affirmed Justice Cuddy's decision on
January 24, 2012. Anderson v. Banks, 2012 ME 6. The
Law Court stated that the "pivotal issue" was the
sisters' contention that the parties to the settlement
agreement did not intend to submit disputes concerning the
validity of the agreement to arbitration. 2012 ME 6 ¶
13. Disagreeing with the Superior Court that the sisters had
not preserved their argument that they had not agreed to
arbitrate the validity of the settlement agreement, the Law
Court nevertheless found that the Superior Court's
decision had addressed the validity of the agreement to
arbitrate and that its "conclusion that the [Settlement
Agreement] contained within it the authority to allow the
arbitrator to decide the validity of the Agreement as a whole
was not an error of law." 2012 ME 6 ¶¶ 16-19.
This statement was specifically made with respect to the
sisters' arguments that the settlement agreement was
illusory and violated the statute of frauds. See
2012 ME 6 ¶¶ 16, 18.
Court also rejected the four sisters' other challenges to
the Superior Court decision. 2012 ME 6 ¶ 20. The Court
did not address Budd's authority to execute the
settlement agreement on behalf of Anderson and Collins and
whether, if Budd had lacked authority, Anderson and Collins
were not bound because they had never agreed to arbitrate. No
argument with respect to Budd's authority was ever raised
by Mills in the Law Court. Plaintiffs' SAMF ¶
Collins, Johnson, and York subsequently commenced an action
against Attorney Budd, Rudman Winchell, and several other
Rudman Winchell lawyers for professional negligence.
See Plaintiffs' SAMF ¶ 88 n.1. In their
Rule 56(h)(2) statement, Anderson and Collins have relied on
depositions taken in that action, Anderson v. Budd,