ROBINSON, J.
¶ 1. This case involves a jury award of emotional distress and economic damages in a legal malpractice action. Defendant challenges the damages award on the grounds that emotional distress damages are not available in a legal malpractice case and that the award of economic damages equal to the amount plaintiff paid to settle the underlying case was improper because plaintiff failed to establish that the underlying settlement was reasonable. We reverse as to the award of emotional distress damages and affirm as to the economic damages award.
¶ 2. The facts of the underlying case that gave rise to this malpractice action are summarized in our three opinions involving that case. See Wetherby v. Vincent, No. 2007-276 (Vt. Mar. 26, 2008) (unpub.mem.); Wetherby v. Vincent, No. 2005-417 (Vt. Oct. 3, 2006) (unpub.mem.); Wetherby v. Vincent, No. 2004-014 (Vt. Sept. 1, 2004) (unpub.mem.). In May 2003, plaintiff Leland Vincent — then eighty-two — and his older sister signed a contract to sell their home for $52,000 to buyers. Shortly before the scheduled closing, after plaintiff's sister had died, plaintiff refused to go through with the sale. On July 31, 2003, buyers sued for specific performance on the contract. Defendant, attorney Douglas DeVries, represented plaintiff, the seller, who was the defendant in that suit and is now the plaintiff in this malpractice case against attorney DeVries.
¶ 3. Defendant, on plaintiff's behalf, subsequently filed an answer and a series of pleadings seeking relief from judgment and a denial of buyers' summary judgment motion on the ground that plaintiff and his sister had been induced into signing the contract by buyers' fraud and misrepresentation. In particular, plaintiff testified by affidavit that he was legally blind and that he signed the agreement only after buyers told him it was not an agreement to
¶ 4. In June 2008, on the eve of a hearing on buyers' motion for the court to authorize a third party to execute a deed to transfer the property from Vincent to buyers, plaintiff, then represented by new counsel, entered into a settlement agreement with buyers that allowed him to keep his home. The agreement, which was contingent on approval by the superior court probate division because plaintiff was subject to a guardianship, required plaintiff to pay buyers $68,000 plus $35,000 "to reimburse [buyers] for [their] attorney's fees and costs." In exchange for these payments, the settlement provided that the superior court's order requiring specific performance would be null and void.
¶ 5. Meanwhile, in May 2008, plaintiff brought this legal malpractice action against defendant, pointing to defendant's failure to timely file an answer, affirmative defenses, or a counterclaim in the suit; defendant's recommendation that plaintiff sign a stipulation that prevented plaintiff from raising defenses to buyers' suit without informing him of the consequences; defendant's failure to present appropriate defenses to the summary judgment motion; and defendant's failure to inform plaintiff of filings and dispositive orders in the course of the litigation. The essence of plaintiff's complaint is that defendant had notice of plaintiff's limitations but failed to recognize and timely plead meritorious defenses to buyers' specific performance action. Plaintiff also alleges that defendant committed malpractice in advising him not to accept a pre-suit settlement offer by the buyers that would have allowed him to rescind the contract to sell his house in exchange for $15,000 — considerably less than buyers ultimately required to allow plaintiff to keep his home. In his complaint against defendant, plaintiff sought "damages in an amount to be determined by the trier of fact together with costs and such other and further relief as the Court may deem fitting and proper."
¶ 6. Defendant admitted to the facts underlying plaintiff's claim that defendant breached a duty to plaintiff, and put to the jury the issues of causation and damages. That required plaintiff to conduct essentially a trial-within-a-trial to prove that if defendant had not represented plaintiff negligently in the litigation with the buyers, plaintiff would not have been ordered to convey his home to buyers in exchange for $52,000. If plaintiff won on that issue, he could then prove the damages he suffered as a result of the breach.
¶ 7. In repeated motions before, during, and after trial, defendant strenuously argued that, as a matter of law, emotional distress damages are not available in a legal malpractice case such as this. Defendant also argued that because specific performance was the only remedy available under the contract plaintiff signed to sell his property to buyers, plaintiff was not at risk of a judgment for damages to buyers. Nor was plaintiff subject to any potential attorney's fee award in connection with the judgment for specific performance that the court awarded to buyers.
¶ 8. The jury returned a verdict for plaintiff, awarding a total of $183,000 in damages comprising $103,000 in economic damages — representing what plaintiff paid to settle the underlying case and retain his home — and $80,000 in emotional distress damages.
¶ 9. Defendant appeals, challenging the trial court's denial of his motions for judgment as a matter of law on the issues of emotional distress and economic damages. We review a denial of a motion for judgment as a matter of law de novo, considering the evidence "in the light most favorable to the nonmoving party, excluding the effect of modifying evidence." J.A. Morrissey, Inc. v. Smejkal, 2010 VT 66, ¶ 8, 188 Vt. 245, 6 A.3d 701. "Judgment as a matter of law is appropriate where there is no legally sufficient evidentiary basis for a reasonable jury to find for [the nonmoving] party on that issue. Thus, we will reverse the trial court's denial of a motion for judgment as a matter of law only where no evidence exists that fairly and reasonably supports the jury's verdict." Id. (quotations and citations omitted).
¶ 10. On appeal, defendant reiterates his argument that, as a matter of law, emotional distress damages are not available in this legal malpractice case. We have never decided the question; the closest we have come was a case relied upon by plaintiff in which we suggested that under certain exceptional circumstances, emotional distress damages might be available for legal malpractice. Fitzgerald v. Congleton, 155 Vt. 283, 292 n. 7, 583 A.2d 595, 600 n. 7 (1990). In Fitzgerald we considered a legal malpractice claim against a lawyer who represented a mother in a case in which the State had alleged that her child was in need of supervision. As a result of the defendant lawyer's negligent representation, the mother alleged, she lost custody of her child for a period of time. The mother filed her claim more than three years after discharging the lawyer, and the issue on appeal was whether the trial court erred by applying the three-year rather than the six-year statute of limitations and dismissing her legal malpractice claim. We concluded that to the extent that the mother sought damages for economic losses, her claim was governed by the six-year statute of limitations, but that her claim for damages for the emotional distress suffered as a result of defendant's negligent representation was barred by the three-year statute of limitations. Id. at 293, 583 A.2d at 601. In arriving at the conclusion that emotional distress damages were injuries to the person subject to the three-year statute of limitations, we assumed without deciding that these damages were actually available in attorney malpractice, and we noted, "Absent physical contact, one may recover for negligently caused emotional distress only when the distress is accompanied by substantial bodily injury or sickness. Accordingly, one must show some physical effect of any claimed emotional injury — some bodily hurt — in order to prevail." Id. at 292, 583 A.2d at 600 (quotation omitted).
¶ 11. Our discussion in Fitzgerald reflected an assumption, at least for the purposes
¶ 12. In the limited number of cases before this Court regarding the availability of emotional distress damages for negligence in the absence of physical injury, we have reaffirmed this general rule. See Goodby v. Vetpharm, Inc., 2009 VT 52, ¶ 11, 186 Vt. 63, 974 A.2d 1269 ("We are not persuaded that a special exception to recover noneconomic damages for the loss of companion animals occasioned by negligence, damages not entirely distinct from human grief and anguish attending the negligent destruction of other personally important property, both sentient and nonsentient, should be undertaken outside of the legislative arena."); Pearson v. Simmonds Precision Prods., Inc., 160 Vt. 168, 173-74, 624 A.2d 1134, 1137 (1993) (denying plaintiff recovery for emotional distress damages for employer's negligent misrepresentation and negligent failure to disclose because only damages for pecuniary injuries are available for those torts); cf. Cooper v. Cooper, 173 Vt. 1, 14, 783 A.2d 430, 441 (2001) (allowing damages for emotional distress where acts supporting breach of fiduciary duty by cotenant were intentional).
¶ 13. Although in Fitzgerald we recited the general rule that absent physical impact emotional distress damages are only recoverable in cases of ordinary negligence when the distress is accompanied by substantial bodily injury or sickness, we then said in a footnote:
155 Vt. at 292 n. 7, 583 A.2d at 600 n. 7.
¶ 14. The two types of special circumstances identified in the footnote as exceptions to the general rule — mishandling of bodily remains and negligent transmission of a message announcing death — are long established. See, e.g., Christensen v. Superior Court, 54 Cal.3d 868, 2 Cal.Rptr.2d 79,
¶ 15. Although the general rule precluding emotional distress damages in ordinary negligence claims without physical impact is longstanding, well-established, and almost universally embraced, the rationales underlying the rule are less clear and, arguably, not entirely compelling. Some courts have explained that "the law looks with disfavor upon [emotional distress] damages because the proof of their existence often lies wholly within the one who claims to have suffered, and their allowance would open the door to fraud." Bowman v. Doherty, 235 Kan. 870, 686 P.2d 112, 118 (1984). But these courts do not explain why a claim of emotional distress by one who has experienced a physical impact of some sort is significantly more reliable, and they fail to deal squarely with the myriad cases in which common sense and compelling evidence confirm the likely validity of a claim of emotional distress in response to a particular act of negligence — as in the mishandled-bodily-remains cases noted above.
¶ 16. Some courts also point to the lack of foreseeability of emotional injury as a result of negligence unaccompanied by physical harm as a basis for excluding damages for such injury. See id.; see also Douglas v. Delp, 987 S.W.2d 879, 885 (Tex. 1999) ("The foreseeable result of an attorney's negligence, [in contrast to that of a physician's negligence], typically extends only to economic loss."). But it is not hard to think of a host of situations in which the likelihood that a person's negligence will lead to substantial emotional distress is high. See Restatement (Third) of Torts: Liability for Physical and Emotional Harm § 47 cmts. b, i (2012) ("[F]oreseeability cannot appropriately be employed as the standard to limit liability for emotional harm.").
¶ 17. Perhaps because a flat-out, no-emotional-distress-damages rule in cases not involving physical impact is broader than its rationales would support, courts have carved out or expanded the exceptions to the general rule — such as the exception for mishandling bodily remains described above. Acknowledging the "extensive criticism aimed at the artificial devices used by courts to protect against fraudulent claims and against undue burden on the conduct of defendants," the
¶ 18. The D.C. Court of Appeals recognized this evolution in the law in a thoughtful and thorough survey of the law concerning emotional distress damages:
Hedgepeth v. Whitman Walker Clinic, 22 A.3d 789, 802 (D.C.App.2011). That court endorsed claims for serious emotional distress damages in the absence of physical impact under limited circumstances:
Id. at 810-11.
¶ 19. On this basis, modern courts have expanded the "mishandling bodily remains" line of cases to include a host of other types of special relationships or undertakings that are "fraught with the risk of emotional harm." Restatement (Third) of Torts: for Physical & Emotional Harm § 47 cmt. b.; see, e.g., Hedgepeth, 22 A.3d 789 (damages for emotional distress available where doctor negligently informed patient that he was HIV positive when he was not); Nome Commercial Co. v. Nat'l Bank of Alaska, 948 P.2d 443, 453 (Alaska 1997) (contractual relationship can be basis for emotional damages where contracts are "highly personal and laden with emotion such as contracts to marry, to conduct a funeral, to sell a sealed casket, to conduct a cesarean birth, [or] to surgically rebuild a nose" (quotation omitted)); Larsen v. Banner Health Sys., 81 P.3d 196, 202-06 (Wyo.2003) (mother could recover for emotional harm resulting from hospital switching babies, which went undiscovered for forty-three years). "These relationships frequently involve an abuse of power or a position of actual or apparent authority." Restatement (Third) of Torts: Liability for Physical & Emotional Harm § 47 Reporter's Notes, cmt. d (Tentative Draft No. 5, 2007).
¶ 20. How do these considerations play out in the context of claims for emotional distress damages in legal malpractice actions?
¶ 21. However, following the general trend of narrowing the bar against damages for emotional injury in the absence of physical impact, some courts have concluded that emotional distress damages are recoverable "if the lawyer is contracted to perform services involving deeply emotional
¶ 22. If, in fact, emotional distress damages are available in legal malpractice claims, the question remains whether the threatened loss of one's home is the kind of deeply personal injury — like a loss of liberty or separation from one's child — that can support a claim for emotional
Id. ¶ 25 (citations omitted).
¶ 23. Similarly, in Crone v. Nestor, an Iowa appellate court held that an attorney's representation of a plaintiff in a divorce proceeding "was not the sort of contractual relationship that carried with it a deeply emotional response in the event of a breach" that would permit plaintiff to support a claim for emotional distress damages without a showing of physical manifestations. No. 09-0231, 2010 WL 3324923, at *5 (Iowa Ct.App. Aug. 25, 2010). In Crone, the plaintiff alleged that her divorce attorney committed legal malpractice by failing to ensure that her ex-husband followed through on his obligations to establish a trust to pay off the mortgage on the house she was awarded in the event of the ex-husband's death. Id. at *1. The ex-husband did not set up the trust and died before the mortgage was paid in full, as a result of which the plaintiff lost the house in a foreclosure. Id. The plaintiff claimed emotional distress damages. Id. The court noted what it labeled the majority view that "emotional distress is not a reasonably foreseeable consequence of and does not naturally ensue from an act of legal malpractice," and observed that the nature of the representation was not of the sort that triggered an exception for peculiarly personal subject matters and denied such damages. Id. at *4 (quotation omitted).
¶ 24. Likewise, a Louisiana appeals court considered a case in which an attorney's negligence in failing to advise the client of the consequences of a "simulated sale" ultimately led to the client's losing the property in foreclosure. Richards v. Cousins, 550 So.2d 1273, 1274 (La.Ct.App. 1989). The court affirmed the trial court's denial of damages for mental anguish and emotional distress resulting from the
¶ 25. In light of the above considerations, we conclude that the trial court erred in awarding damages for plaintiff's emotional distress in this case. Assuming without deciding that Vermont law follows the modern trend of allowing damages under certain circumstances for serious emotional distress in legal malpractice claims and that the evidence in this case could support a finding of sufficiently serious emotional anguish to support such a claim,
¶ 26. "The measure of damages for malpractice is `all damages proximately caused by the wrongful act or omission.'" Bloomer v. Gibson, 2006 VT 104, ¶ 27, 180 Vt. 397, 912 A.2d 424 (quoting 3 R. Mallen & J. Smith, Legal Malpractice § 20.4, at 13 (2006 ed.)). "Such damage may include,
¶ 27. We agree with defendant and the trial court that when a claim for malpractice damages is predicated on the difference between the settlement actually reached and the resolution that would have been reached in the absence of the malpractice, the settlement must be reasonable. Cf. Digregorio v. Champlain Valley Fruit Co., 127 Vt. 562, 566, 255 A.2d 183, 186 (1969) (adopting "reasonable settlement" requirement in context of indemnity claim by retailer against wholesaler for damages to consumer injured by banana with thermometer in it).
¶ 28. The plaintiff has the burden of showing all elements of a legal malpractice case, including damages. See Clayton v. Unsworth, 2010 VT 84, ¶ 17, 188 Vt. 432, 8 A.3d 1066 (identifying elements of legal malpractice claim to be proven by plaintiff); see also Bourne v. Lajoie, 149 Vt. 45, 53, 540 A.2d 359, 364 (1987) (rejecting plaintiff's claim that defendant attorney's negligent drafting of deed caused her damages by preventing her from selling affected parcels in absence of affirmative evidence of actual offer from prospective purchaser that she was unable to pursue). Accordingly, plaintiff must present prima facie evidence of the reasonableness of the agreement. See Associated Ins. Serv., Inc. v. Garcia, 307 S.W.3d 58, 69 (Ky.2010) ("[T]he best approach is to allow the prejudgment settlement [between the injured party and the insured that assigned its rights against the insurer to the injured party], but to require some assessment of the reasonableness of the award. The plaintiff has the burden of presenting prima facie evidence of the settlement's reasonableness insofar as it purports to establish liability. The defendant retains a full[] panoply of defenses with which to rebut this presumption: fraud, collusion, unreasonableness, etc.").
¶ 29. Ultimately, the question of whether a settlement is reasonable is for the jury. Boston & Me. R.R. v. Howard Hardware Co., 123 Vt. 203, 210, 186 A.2d 184, 190 (1962) ("It was for the jury to determine whether the settlement was reasonable, prudent and reached in good faith. In deciding this issue the jury should have considered the likelihood of
¶ 30. At the trial below, plaintiff's economic damage claim was predicated solely on the $103,000 settlement plaintiff entered into to void the court order requiring him to transfer his property to buyers for $52,000. Accordingly, the court instructed the jury on economic damages as follows:
Defendant did not object to this charge.
¶ 31. On appeal, defendant argues that, as a matter of law, plaintiff failed to produce any evidence to support the objective reasonableness of the settlement. In particular, defendant argues that plaintiff faced no exposure for attorney's fees under the purchase and sale agreement and therefore the $35,000 of the settlement that was allocated to the Wetherbys' attorney's fees was strictly voluntary and not a reasonable compromise of a disputed claim; that plaintiff effectively paid $155,000 to remain in the house — the $52,000 purchase price that he forewent plus the $103,000 that he paid out of pocket — when there was no evidence that the property was worth anything near that amount and the 2003 town tax assessment was $52,900; and that plaintiff offered no rationale for the amount of the settlement but instead relied entirely on buyer's objected-to testimony on cross-examination — after plaintiff had rested his case — regarding buyers' settlement demands.
¶ 32. Plaintiff points to evidence that the probate court reviewed and approved the settlement, as well as evidence that the settlement resulted from arm's-length negotiations between buyers' attorney and plaintiff's attorney, and argues that the settlement amount was reasonable because it was what was required to restore plaintiff to the position he would have been in — living in his lifelong home — had defendant not committed malpractice.
¶ 33. The evidence potentially related to the reasonableness of the settlement presented to the jury in plaintiff's case, before defendant's motion for judgment as a matter of law, consisted of the following:
¶ 34. The question before us is whether this evidence is sufficient to support a prima facie case that the $103,000 settlement reached by plaintiff and buyers, which formed the basis for the jury's economic damage award of $103,000, was reasonable.
¶ 35. We conclude that plaintiff satisfied his burden. Although the evidence is admittedly thin, the jury could reasonably conclude that a settlement agreement negotiated at arm's length over a period of time between plaintiff's lawyer and opposing counsel, approved by plaintiff's guardians, and reviewed and approved by the probate court was a reasonable settlement. Given this evidence, plaintiff was not required to establish the market value of his property to prove the reasonableness of the settlement.
¶ 36. Moreover, although a settlement substantially out of sync with the actual market value of the property would not be objectively reasonable, a jury could reasonably conclude that the decision to pay a modest premium over market value in circumstances like this — to avoid the costs and risks of moving a vision-impaired octogenarian from his lifetime home in the final years of his life — was entirely reasonable.
¶ 37. This does not mean that plaintiff was entitled as a matter of law to reimbursement of the full $103,000 he paid to keep his home. Defendant was free to offer evidence and argument that this sum was excessive relative to the actual value of the property, and that plaintiff was not entitled to recover the full amount. But we cannot say that the evidence presented was insufficient to allow the jury to award the full $103,000.
The award of damages for plaintiff's emotional distress is reversed, and the award of damages for his economic damages is affirmed.