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IN THE SUPREME COURT OF IOWA
No. 143 / 05-1040 Filed April 6, 2007 STEVEN J. FABER, Appellee, vs. DOUGLAS D. HERMAN, Appellant. ________________________________________________________________________ On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Jones County, L. Vern Robinson, Judge.

Further review from a decision by the court of appeals affirming a judgment for damages in a legal malpractice action. DECISION OF

COURT OF APPEALS VACATED; DISTRICT COURT JUDGMENT REVERSED.

Patrick M. Roby and Robert M. Hogg of Elderkin & Pirnie, P.L.C., Cedar Rapids, for appellant.

Max E. Kirk of Ball, Kirk & Holm, P.C., Waterloo, for appellee.

2 CADY, Justice. In this appeal from a judgment against a lawyer in a legal malpractice action based on claims of negligence while representing a former client in a dissolution proceeding, we conclude the claims of malpractice did not cause the damages sought as a matter of law. We vacate the decision of the court of appeals and reverse the judgment of the district court. I. Background Facts and Proceedings. Douglas Herman is an Iowa lawyer. He represented Steven Faber in an action to dissolve his marriage to Karen Faber. represented by attorney Karl Moorman. The Fabers were married for nineteen years at the time the dissolution action was commenced. The divorce presented many Karen was

challenging issues, not the least of which was the equitable division of their marital property. The parties and their attorneys worked to resolve these issues, which ultimately resulted in a stipulated decree for dissolution of marriage. One item of property divided under the stipulation and decree was Steven's retirement account with the Iowa Public Employer's Retirement System (IPERS). Steven began working for the State of Iowa two years after the marriage. He worked at the Anamosa state

penitentiary as a corrections officer, and continued to be employed in that capacity until after the divorce. Based on information provided by IPERS during the pendency of the divorce, Steven learned the "investment value" of his retirement account was $38,179.38, and the "death benefit" was $63,785.94. The "death benefit" represented the amount to be distributed to Karen, as the designated beneficiary, in the event of Steven's death. The "investment

3 value" represented the amount Steven would receive in a lump sum payment if he retired from his employment with the State of Iowa on the day the value was determined. Steven was vested in the pension plan, and therefore the "investment value" represented all of his personal contributions during the course of his employment plus a portion from his employer. Steven and Karen agreed to divide the IPERS account equally. To accomplish this division, they considered the "investment value" to be the value of the account, and they sought to divide the account by means of a qualified domestic relations order (QDRO) that required IPERS to immediately pay Karen one-half of the investment value, or $19,100. Specifically, the stipulation required Steven to "immediately pay $19,100.00 to [Karen] from his I.P.E.R.S. retirement account pursuant to a separate Qualified Domestic Relations Order issued by the Court." Steven and Karen also prepared an itemization of the division of all their property by listing each item of property received by each party in separate columns, with a corresponding value assigned to each item. This itemization was attached to the written stipulation signed by the parties. Steven's column included "IPERS (one-half)" with a value of

"$19100." Likewise, Karen's column included "IPERS (one-half)" with a value of "$19100." The stipulation was signed by Steven and Karen in May 1999, and the decree was entered by the court. Moorman then drafted a proposed QDRO to divide the IPERS account pursuant to the stipulation. This proposed order essentially

directed IPERS to create a separate interest for Karen in the amount of $19,100, payable to her as a participant under the plan. Moorman then sent the order to the administrator of IPERS for approval. IPERS rejected the proposed QDRO because it allowed Karen to acquire independent

4 rights in the account. IPERS informed Moorman that Karen could not receive any benefits until Steven began to receive benefits or died. IPERS also informed Moorman that Karen had no right to independently select a distribution option and begin receiving benefits, or to have a separate account set aside in her name. Moorman then drafted a new QDRO that abandoned the lumpsum division approach agreed to by the parties under their stipulation. The new QDRO provided for the benefits to be distributed to Steven and Karen upon Steven's retirement under a formula based on the length of the marriage and the length of employment. The QDRO provided: IPERS is directed to pay benefits to [Karen] as a marital property settlement under the following formula: Fifty percent (50%) of the gross monthly or lump sum benefit payable at the date of distribution to [Steven] multiplied by the "service factor." The numerator of the service factor is 70 and the denominator is [Steven's] total quarters of service covered by IPERS. Under the QDRO the benefits were to inure to Karen as an alternate payee for Steven's life, and were not to begin until "[Steven] begins to receive benefits from IPERS or when the death benefits become payable . . . whichever occurs first." IPERS approved this QDRO, and it was

signed by Herman, Moorman, and the court in July of 1999. Herman did not directly participate in drafting the QDRO, but he did approve it. Herman acknowledged his approval in a letter to Steven in September of 1999. The letter informed Steven the QDRO had been finalized, and it divided his IPERS account "consistent with the stipulation." Herman did not tell Steven that IPERS rejected the lumpsum payment approach agreed to under the stipulation, and he did not explain the percentage method of distribution ultimately used to divide the pension. Consequently, Steven understood at the conclusion of his

5 divorce that his IPERS account had been divided pursuant to the stipulation. In 2000, the Iowa legislature amended the law governing IPERS to permit in-service disability benefits. 2000 Iowa Acts ch. 1077,

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