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FOR IMMEDIATE NEWS RELEASE NEWS RELEASE # 6 FROM: CLERK OF SUPREME COURT OF LOUISIANA The Opinions handed down on the 21st day of January, 2004, are as follows: BY WEIMER, J.: 2003-C -1146 JOSEPHINE COSTELLO v. ASHTON R. HARDY, BRADFORD D. CAREY, HARDY AND CAREY, L.L.P., AND XYZ INSURANCE COMPANY (Parish of Jefferson) Finding that the element of malice was not proved, we reverse the judgments of the court of appeal and the trial court awarding damages for defamation. In all other respects, the judgments of the lower courts are affirmed. REVERSED IN PART; AFFIRMED IN PART. JOHNSON, J., concurs in the result KNOLL, J., additionally concurs for the assigned reasons.

1/21/04

SUPREME COURT OF LOUISIANA
No. 03-C-1146 JOSEPHINE COSTELLO VERSUS ASHTON R. HARDY, BRADFORD D. CAREY, HARDY AND CAREY, L.L.P., AND XYZ INSURANCE COMPANY
On Writ of Certiorari to the Court of Appeal, Fifth Circuit, Parish of Jefferson

WEIMER, Justice This litigation originated as a suit alleging legal malpractice. The plaintiff alleged that the defendant attorneys failed to properly draft the will of plaintiff's late son to reflect the son's desire to provide his 85-year-old mother with $25,000.00 per year for living expenses. Defendants answered and asserted a reconventional demand seeking damages for abuse of process and for allegedly defamatory statements in the plaintiff's petition. The trial court granted a motion for partial summary judgment on the legal malpractice claim, dismissing plaintiff's claims against the attorneys and their law firm with prejudice. Following a trial on the merits of the reconventional demand, the trial court found in favor of the defendants on the defamation claim and awarded the attorneys damages totaling $60,000.00. The court of appeal affirmed, finding no error in the rulings of the trial court. We granted certiorari primarily to address the propriety of the award of damages for defamation. Finding that the evidence fails to establish the element of malice, or fault, and that the trial court erred in its determination to the contrary, we reverse the judgment awarding damages for defamation. In all other respects, the judgments below are affirmed. FACTS AND PROCEDURAL HISTORY

In January 1997, Joseph Costello, a successful businessman with considerable holdings in the communications industry,1 found himself in deteriorating health. He contacted his longtime attorney and friend, Ashton Hardy, and requested that Hardy draft his will. Costello, who was unmarried and had no children, wished to leave the bulk of his estate to Loyola University. Hardy contacted the Director of Planned Giving at Loyola, Robert Gross, and together Hardy and Gross met with Costello to discuss the disposition of his estate. Hardy's office then prepared an initial draft of the will. That draft was subsequently revised to include a specific bequest to Costello's elderly mother, Josephine Costello, granting her the usufruct of Costello's home for the remainder of her life. On the morning of March 5, 1997, Hardy received a telephone call from Costello who informed him about surgery scheduled the next day and concerns related to the risks associated with undergoing general anesthesia, which prompted a wish to finalize his will that day. The will was signed on the afternoon of March 5. At the time of signing, it was contemplated that revisions might be necessary to complete some unresolved estate planning issues. One of those issues was Costello's desire to provide his mother with an annual income of $25,000.00 should he pre-decease her. Discussions between Hardy and Gross as to the best method of accomplishing this goal, as well as how to accomplish other estate planning goals, ensued over the next few weeks. Apparently, Costello was concerned that any bequest to his mother not disqualify her from receiving federal benefits in the event she should find it necessary to enter a nursing home. Costello, Hardy, and tax attorney Michael Mayhall scheduled a meeting for April 8, 1997, to discuss the will, the best method of effectuating the stipend to Costello's mother, and various tax issues. Unfortunately, Costello was hospitalized
Costello's broadcast empire included pioneer FM rock radio station WRNO, KXOR FM, WTIX, and worldwide shortwave radio station WRNO. 2
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that day. He remained in the hospital until his death on April 23, 1997. At the time of Costello's death, no document existed, testamentary or otherwise, that guaranteed his mother the $25,000.00 annual income Costello desired her to receive. Costello was survived by his mother and three brothers, who were incensed by the terms of Costello's will and the substantial bequest to Loyola. The family was particularly aggrieved over the lack of any meaningful provision for Costello's mother. On July 8, 1997, a "Petition to Annul and/or Declare Invalid the Probated Testament of Joseph M. Costello, III" was filed in the Succession of Joseph M. Costello, III, in the Civil District Court for the Parish of Orleans, naming as defendants the co-executors, Ashton R. Hardy and Michael Costello; and legatees, The Mary Joseph Residence for the Elderly, Loyola University, Aloma Powell, and the Greater New Orleans Foundation (collectively "Succession"). The petition, filed on behalf of Josephine, Martin, and Donald Costello, alleged that the will was invalid because Costello was of unsound mind and body; was acting under duress, fraud or mistake; and/or lacked testamentary capacity at the time he signed the will. The Costello petitioners were represented in this litigation by attorney James Minge. During the course of discovery in the nullity proceeding, numerous documents were produced. Among the documents was a letter, dated February 26, 1997, from Hardy to Loyola's Gross stating: As promised, I am enclosing herewith a copy of the latest draft of the Last Will and Testament that I prepared for Joe Costello. During my conference with him, he indicated that he wanted to ensure that his mother received an annual income of $25,000.00 during her lifetime, should she survive him. How do you propose that we deal with that issue[?] A second letter, dated March 7, 1997, was also produced. This letter, addressed to Hardy and authored by Gross, states in part:

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One of Joe's concerns when we were talking before the reading of the will was that the will be "iron clad." He is worried about a family attack on the will, as happened in his father's succession. .... Joe is also concerned about providing his mother with $25,000 annually of income. A "special needs" Charitable Remainder Trust of a sufficient size could be established for this purpose. If the remainderman of this trust was Loyola, it would not be necessary to change the will, i.e. the cash bequest to Greater New Orleans Foundation. On the basis of these documents, and others (including one transmitting to Hardy suggested language for including the bequest to Mrs. Costello in a revision of Costello's will), Minge advised the Costello family that, should the will be found to be valid, Mrs. Costello, as a legatee and third party beneficiary under the will, had a potential cause of action against Hardy for negligence in the drafting of the will. Minge referred the Costellos to attorney Richard Root for further investigation of this potential claim. On April 18, 1998, with the one year anniversary of Costello's death approaching, Josephine Costello, through attorney Root, filed a petition for damages in the Twenty-Fourth Judicial District Court for the Parish of Jefferson. The petition named as defendants Ashton R. Hardy, Bradford D. Carey, and the law firm of Hardy and Carey, L.L.P.; it alleged that Hardy failed to properly draft or amend Joseph Costello's will to include the bequest of $25,000.00 annually to Josephine Costello and that such conduct fell below the standard of care of competent practitioners in the same field and locality.2 As a result, the allegations continued, Mrs. Costello was

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Mrs. Costello's petition states, in pertinent part: That defendant Hardy's representation of plaintiff fell below the standard of care of competent practitioners in his same field and in defendant's locality. .... Defendant Hardy's actions, as described above, constitute negligence, and plaintiff's damages arise from that negligence. 4

deprived of living expenses, leaving her unable to support herself in the residence over which she was granted usufruct. Shortly after the institution of the legal malpractice action in Jefferson Parish, the Costello family settled the nullity action in Orleans Parish. Specifically, the Costellos dismissed their challenge to the will, acknowledging the validity of that document and of all of the legacies outlined therein, in exchange for the Succession's agreement to provide Josephine Costello with a $25,000.00 annual stipend from her late son's estate. The terms of the settlement were read into the record on June 17, 1998, and finalized in a "Petition for Authority to Compromise Claim" filed on October 20, 1998. In the interim, the defendants in the Jefferson Parish malpractice action filed an exception of no cause of action, asserting that they did not have an attorney-client relationship with Mrs. Costello and, therefore, owed no duty to her in connection with the drafting of her late son's will. The trial court granted the no cause of action exception, dismissing Mrs. Costello's suit. Mrs. Costello appealed. In an opinion not designated for publication, the court of appeal reversed, finding that as a legatee and third party beneficiary under the will, Mrs. Costello stated a cause of action in negligence against Hardy for his failure either to include a provision in the will for her living expenses or to prepare a codicil providing for living expenses. Costello v. Hardy, 98-1320 (La.App. 5 Cir. 4/27/99) 738 So.2d 210.3 The case was remanded to the trial court where defendants filed an answer and reconventional demand seeking damages for abuse of process and defamation arising out of the allegations of malpractice in Mrs. Costello's petition.4 Thereafter, the

The court of appeal decision relied in part on the ruling of this court in Succession of Killingsworth, 292 So.2d 536 (La. 1973) (on original hearing). Bradford D. Carey, a defendant in the main demand, is not a plaintiff-in-reconvention. Plaintiffsin-reconvention are Hardy and the law firm, Hardy and Carey, L.L.P. 5
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defendants filed a motion for partial summary judgment on the malpractice claim. Finding no genuine issue of material fact, the trial court granted summary judgment in favor of defendants, dismissing Mrs. Costello's claim. Mrs. Costello again appealed. The court of appeal dismissed that appeal as premature because the judgment was a partial summary judgment that was not "designated as a final judgment by the court after an express determination that there is no just reason for delay" pursuant to LSA-C.C.P. art. 1915(B) and the defendant's reconventional demand was still pending. Costello v. Hardy, 01-583 (La.App. 5 Cir. 1/15/02), 807 So.2d 950. The case was returned to the trial court where a bench trial was conducted on the reconventional demand. Following the close of evidence, the trial court ruled in favor of Ashton R. Hardy and the law firm of Hardy and Carey, L.L.P. on the defamation claim. The court concluded that Mrs. Costello lacked probable cause to bring the malpractice action, finding "no evidence whatsoever to support the allegation that Mr. Costello wanted anything different than what he got when he executed his will on March 5, 1997," and that although Mr. Costello desired that his mother be taken care of financially, he simply ran out of time to accomplish this task prior to his demise. Based on deposition testimony from Mrs. Costello that the malpractice action was "plan B" for obtaining the $25,000.00 stipend in the event the attack on the will failed, the court found "motivation on behalf of Ms. Josephine Costello to be abusive, to be reckless and as implemented to be frivolous."5 For the defamation, the court awarded $10,000.00 in damages to the law firm, Hardy and Carey, L.L.P., representing the deductible under the firm's policy of malpractice insurance. Hardy was awarded damages totaling $50,000.00 for mental anguish and

We note the malpractice suit was filed prior to the settlement of the suit in Civil District Court in Orleans Parish which sought to annul or declare invalid the probated testament of Joseph M. Costello, III. 6

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personal suffering. The trial court found no evidence to support any loss of business or business reputation and denied a claim for escalating insurance premiums as being too speculative. The claim for abuse of process asserted by Hardy and the law firm was likewise rejected. Judgment was rendered accordingly. Mrs. Costello appealed the judgment awarding damages for defamation, as well as the partial summary judgment in favor of defendants Hardy and Hardy and Carey, L.L.P. on her malpractice claim.6 The Court of Appeal, Fifth Circuit rendered its opinion in this matter on March 25, 2003. Costello v. Hardy, 02-1156 (La.App. 5 Cir. 3/25/03), 844 So.2d 212. That opinion affirmed the judgment of the trial court in its entirety. With respect to the summary judgment in favor of defendants Hardy and Hardy and Carey, L.L.P., the court of appeal noted that in order to prevail on her malpractice claim, Mrs. Costello had to establish three elements: 1) the existence of an attorney-client relationship; 2) negligent representation by the attorney; and 3) damages caused by the negligence. The court of appeal held that Mrs. Costello failed to establish the existence of any of these three elements. She failed to establish the existence of an attorney-client relationship; she failed to prove that Hardy was negligent in his representation of her son, Joseph Costello; and she failed to prove that she sustained any damages as a result of the alleged malpractice, having reached a settlement in the Orleans Parish lawsuit that provided her with the $25,000.00 annual stipend that she alleged was omitted from the will. The court of appeal, therefore, affirmed the trial court's determination that there were no genuine issues of material fact and that summary judgment was appropriate as to the malpractice claim. The court of appeal likewise affirmed the award of damages for defamation. The court found that the malpractice claim brought by Mrs. Costello was frivolous and
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The summary judgment in favor of Bradford D. Carey was not appealed, and that judgment dismissing Mrs. Costello's claims against Carey is now final. 7

had no merit; that Mrs. Costello filed the suit, which constitutes a publication; that the suit contained defamatory words aimed at harming Hardy's reputation as an attorney; that the claims were false and Mrs. Costello knew this, but had other motives; and that Hardy suffered personal injuries as a result of the defamation. The court of appeal found the damage awards to be reasonable. Finally, the court affirmed the trial court's determination that plaintiffs-in-reconvention failed to satisfy their burden of proving an abuse of process. We granted certiorari primarily to address the defamation claim and Mrs. Costello's contention that the trial court erred in determining that the evidence adduced at trial supports an award of damages for defamation. Hardy v. Costello, 031146 (La. 6/27/03), 847 So.2d 1281. LAW AND DISCUSSION Summary Judgment Before reaching the defamation claim, we must first determine whether summary judgment was properly granted in favor of defendants on Mrs. Costello's main demand, the legal malpractice claim. Appellate courts review summary judgments de novo under the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Schroeder v. Board of Supervisors of Louisiana State University, 591 So.2d 342, 345 (La. 1991). A court must grant a motion for summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law." LSA-C.C.P. art. 966(B). Pursuant to a 1996 amendment to the summary judgment article, the summary judgment procedure is now favored under our law. LSA-C.C.P. art. 966(A)(2).

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In 1997, the legislature enacted LSA-C.C.P. art. 966(C)(2), which clarifies the burden of proof in summary judgment proceedings, providing: The burden of proof remains with the movant. However, if the movant will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, the movant's burden on the motion does not require him to negate all essential elements of the adverse party's claim, action, or defense, but rather to point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense. Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no genuine issue of material fact. This court has explained the effect of the 1997 amendment as follows: This amendment, which closely parallels the language of Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986), first places the burden of producing evidence at the hearing on the motion for summary judgment on the mover (normally the defendant), who can ordinarily meet that burden by submitting affidavits or by pointing out the lack of factual support for an essential element in the opponent's case. At that point, the party who bears the burden of persuasion at trial (usually the plaintiff) must come forth with evidence (affidavits or discovery responses) which demonstrates he or she will be able to meet the burden at trial. Once the motion for summary judgment has been properly supported by the moving party, the failure of the nonmoving party to produce evidence of a material factual dispute mandates the granting of the motion. [Citations omitted.] Babin v. Winn-Dixie Louisiana, Inc., 2000-0078, p. 4 (La. 6/30/00), 764 So.2d 37, 39-40. To establish a claim for legal malpractice, a plaintiff must prove: 1) the existence of an attorney-client relationship; 2) negligent representation by the attorney; and 3) loss caused by that negligence. Finkelstein v. Collier, 636 So.2d 1053, 1058 (La.App. 5 Cir. 1994); Barnett v. Sethi, 608 So.2d 1011, 1014 (La.App. 4 Cir. 1992), writs denied, 613 So.2d 993, 994 (La. 1993). A plaintiff can have no greater rights against attorneys for the negligent handling of a claim than are available in the underlying claim. See, e.g., Spellman v. Bizal, 99-0723, p. 11 (La.App. 4 Cir. 3/1/00), 755 So.2d 1013, 1019; Couture v. Guillory, 97-2796, p. 7 (La.App. 4 Cir. 4/15/98), 713 So.2d 528, 532, writ denied, 98-1323 (La. 6/26/98), 719 So.2d 1287.
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In the instant case, the court of appeal determined that Mrs. Costello could not establish any of the elements essential to her cause of action and affirmed the trial court's grant of summary judgment.7 Despite Mrs. Costello's argument to the contrary, we find defendants have established that summary judgment was proper as to the third element of Mrs. Costello's legal malpractice claim: proof of loss, or damages. Mrs. Costello's petition asserts that as a consequence of Hardy's alleged negligence in the drafting of the will, she was "deprived [of] living expenses in the amount of twenty-five thousand dollars a year for her life" and suffered "extreme emotional distress" upon being left the usufruct of her late son's home, but no money to support herself or maintain that home. In support of their motion for summary judgment, defendants produced a copy of a "Petition for Authority to Compromise Claim" filed in connection with the Civil District Court proceeding challenging the validity of Costello's will. That petition recites the terms of the settlement reached by the parties to that proceeding: in exchange for dismissing the action to annul Costello's will, a charitable remainder annuity trust would be established to provide a life annuity of $25,000.00 per year to Mrs. Costello with the Greater New Orleans Foundation as trustee and charitable beneficiary. Defendants also produced a copy of the trust document submitted to the court for approval in connection with the

Mrs. Costello takes issue with the court of appeal's holding regarding all three elements of her claim. She argues particularly that the court erred in opining that she could not pursue her malpractice claim in the absence of an attorney-client relationship, pointing out that Louisiana courts have held attorneys liable to non-clients for malpractice based upon negligence principles of LSAC.C. art. 2315 and as contract beneficiaries under a stipulation pour autri. See, Succession of Killingsworth, 270 So.2d 196 (La.App. 1 Cir. 1972), writ granted, 273 So.2d 292 (La. 1973), rev'd in part, aff'd in part, 292 So.2d 536 (La. 1973); Woodfork v. Sanders, 248 So.2d 419 (La.App. 4 Cir. 1971), writs denied, 259 La. 759, 252 So.2d 455 (1971). Further, Mrs. Costello argues that she established the existence of a material factual dispute with respect to the quality of Mr. Hardy's representation in this matter. As explained previously, LSA-C.C.P. art. 966 does not require the movant for summary judgment to negate all essential elements of the adverse party's claim, action, or defense, but only to point out to the court that there is an absence of factual support for one or more elements. Thus, our resolution of the damage issue makes it unnecessary to address Mrs. Costello's arguments regarding the first and second elements of her claim. 10

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settlement. Through these documents, defendants established that Mrs. Costello secured from the Succession the $25,0000.00 annual stipend she claims to have been deprived of by Hardy's alleged malpractice. At this point in the proceedings, the burden shifted to Mrs. Costello to produce factual support sufficient to establish that she will be able to satisfy her evidentiary burden at trial of proving damages sustained as a result of Hardy's alleged malpractice. Mrs. Costello failed to produce any factual support for her damage claim. No evidence of mental anguish or emotional distress was offered. As to other damages, Mrs. Costello merely argued in brief that she has yet to receive any of the funds to which she is entitled under the settlement8 and that "being paid five years late in one lump sum is not the same as being paid once a year for the last five years."9 Such unsupported allegations are insufficient to sustain Mrs. Costello's burden. The undisputed fact remains that her claim against her late son's succession for the $25,000.00 per year stipend that was intended but allegedly omitted from his will has been compromised and discharged in the suit to annul the will. Because Mrs. Costello asserts claims for damages against the attorneys in this malpractice action that were discharged in the settlement of the suit against the Succession, the defendants are entitled to judgment as a matter of law dismissing the plaintiff's malpractice claim. In conclusion, we find that defendants met their evidentiary burden of showing an absence of factual support for an essential element of plaintiff's claim: loss or damages. Mrs. Costello failed to produce factual support sufficient to establish that she will be able to satisfy her evidentiary burden of proof as to this element at trial.

The terms of the settlement reflect that payment is contingent upon the Succession's satisfying all of its outstanding creditors and administrative expenses and having sufficient assets to satisfy the particular legacies. To the extent that this statement can be construed as an assertion that damages have accrued in the form of interest on the monies owed and not yet paid by the Succession, this allegation has no merit. The trust document reveals that interest accrues from the date of death and will be paid on the monies owed at the applicable federal rates for charitable remainder trusts. 11
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Accordingly, the trial court properly granted summary judgment in favor of Hardy and the law firm, and the court of appeal correctly affirmed that summary judgment. Defamation Defamation is a tort which involves the invasion of a person's interest in his or her reputation and good name. Fitzgerald v. Tucker, 98-2313, p. 10 (La. 6/29/99), 737 So.2d 706, 715; Trentecosta v. Beck, 96-2388, p. 10 (La. 10/21/97), 703 So.2d 552, 559; Sassone v. Elder, 626 So.2d 345, 350 (La. 1993). "Four elements are necessary to establish a defamation cause of action: (1) a false and defamatory statement concerning another; (2) an unprivileged publication to a third party; (3) fault (negligence or greater) on the part of the publisher; and (4) resulting injury." Trentecosta, 96-2388 at 10, 703 So.2d at 559 (citing RESTATEMENT (SECOND) OF TORTS

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