Lack of expert testimony leads to judgment in favor of Indiana attorney

The lack of expert testimony in a yearslong bankruptcy case led to the appropriate grant of summary judgment to an Indiana attorney, the Indiana Court of Appeals found Tuesday.

In what the appellate court referred to as a “seemingly never-ending bankruptcy saga” arising from “a simple slip and fall personal injury claim,” Anna May Webb filed a personal injury claim premised on the slip and fall that occurred in Dr. P. Kevin Barkal’s office in 2000 against Barkal and the San Diego Pain Management Consultants. The parties reached a settlement of $138,000 to be paid out by SDPMC, with Barkal personally guaranteeing payment.

When the two parties stopped making payments, a California court entered judgment against Barkal and SDPMC for $151,971.21. Then, after having difficulty collecting judgment, the California trial court ordered Barkal to turn over all keys, leases, books, records, ledgers and all other business records relating to 12 entities, including Pemcor.

In January 2008, Barkal moved to Munster and filed bankruptcy in Indiana with the assistance of attorney Daniel Freeland. Additionally, Gordon Gouveia, from the firm Gouveia & Associates, (referred to in the opinion as Attorney Gouveia) was hired separately to represent Barkal Entities to prevent conflict of interest.

In March 2008, Freeland moved for turnover against a California post-judgment limited receiver and requested that the receiver deliver all items from the collection against Barkal and Barkal Entities. Then, Gouveia intervened, claiming that Barkal Entities had an interest in the accounts receivables the receiver was seeking to collect.

After the receiver was ordered to turn over $9,494, the bankruptcy court determined that the accounts receivables of Barkal Entities were not property of the Chapter 13 bankruptcy estate and denied for motion for turnover.

Barkal and his attorneys then decided to withdraw the Chapter 13 bankruptcy and Barkal, writing to Gouveia’s associate, Shawn Cox, demanded that Gouveia filed the necessary corporate bankruptcy to stay the foreclosure of his house in California. However, Cox informed Barkal that he was not in a position to represent Barkal Entities to file Chapter 7 bankruptcies, and further wrote, “We did not ever agree to file bankruptcies on behalf of the entities … and we are not accepting such an engagement at this time.”

In January 2009, Barkal hired attorney David Welch to file Chapter 11 bankruptcy for several Barkal Entities. No Chapter 11 bankruptcy petition had been filed for Pemcor. Then in 2010, Barkal and Pemcor filed suit in Lake Superior Court against Gouveia, alleging due to legal malpractice, they lost “meritorious bankruptcy cases and the attendant bankruptcy protection available to (them) under federal law.” Specifically, Barkal alleged malpractice because Gouveia failed to advise him against Chapter 13 bankruptcy, waived an evidentiary hearing to support a motion for turnover and failed to advise or take any additional action once the Chapter 13 bankruptcy was dismissed.

The trial court granted summary judgment to Gouveia, finding that Barkal and Pemcor failed to present expert testimony to establish the appropriate standard of care and subsequent breach.

Barkal appealed, arguing that the deposition testimonies of two attorneys, Welch and Mark Zuckerberg, were properly designated as expert testimony. But Gouveia pointed out that both Welch and Zuckerberg admitted in their depositions that they were not retained as experts in the case because they had not thoroughly reviewed the case.

“Accordingly, while Attorneys Welch and Zuckerberg may be well versed in bankruptcy, here, in the absence of having reviewed the appropriate documentation, their knowledge cannot assist the ‘trier of fact to understand’ whether Attorney Gouveia committed legal malpractice when representing the Barkal Entities in the Chapter 13 proceedings,” Judge Patricia Riley wrote for the unanimous panel.

The case is P. Kevin Barkal, M.D. and Pemcor, Inc. v. Gouveia & Associates, 45A03-1607-CT-1601.