## Facts

- Wesley E. Phillips, a U.S. Postal Service mechanic, suffered long-term severe gastrointestinal illness and underwent multiple stomach surgeries.
- Phillips applied for Social Security disability benefits, alleging inability to work due to his medical condition; the claim was denied initially and on reconsideration.
- Phillips retained attorney Kenneth P. Clancy to seek an Administrative Law Judge (ALJ) hearing.
- For purposes of the malpractice case, the parties agreed Clancy failed to timely request the ALJ hearing, and Phillips did not receive a hearing on that application.
- Phillips later pursued disability benefits through a subsequent proceeding; an ALJ later submitted an affidavit stating Phillips would have lost even if a timely hearing had occurred on the original application.
- Phillips and his wife sued Clancy for legal malpractice, alleging the missed hearing caused loss of disability benefits.
- In opposing summary judgment, Phillips submitted affidavits from a Social Security disability attorney and a rehabilitation counselor opining Phillips had a substantial likelihood of success at a timely ALJ hearing.

## Issues

1. In a legal malpractice action, is causation determined by an objective “case-within-a-case” standard (what a reasonable factfinder would have done) rather than the subjective view of the original adjudicator?
2. Is an ALJ’s affidavit stating how the underlying claim would have been decided admissible and sufficient to negate causation as a matter of law?
3. In trial- or hearing-level malpractice, does the trier of fact in the malpractice case decide the likely result of the underlying proceeding?

## Decision

- The Court of Appeals reversed the trial court’s grant of summary judgment for Clancy and remanded.
- The court held causation in legal malpractice is evaluated under an objective “case-within-a-case” approach, not by asking how a particular ALJ would have ruled.
- The ALJ affidavit opining on the hypothetical result of a timely hearing was improper to conclusively resolve causation and could not support summary judgment.
- Conflicting expert affidavits created a genuine dispute of material fact on whether Phillips would have obtained benefits absent the attorney’s negligence.
- The likely outcome of the underlying administrative proceeding is for the trier of fact in the malpractice action to determine.

## Legal Principles

- A malpractice plaintiff must prove that, but for counsel’s negligence, the client would have obtained a more favorable result; this is shown by trying the “case within a case.”
- The causation inquiry is objective: it asks what a reasonable factfinder, applying the correct law to the evidence that should have been presented, would likely have decided.
- Affidavits or testimony from judges or ALJs about how they would have decided a matter are generally improper because they intrude on adjudicative mental processes, risk compromising perceived neutrality, and displace the malpractice factfinder’s role.
- Summary judgment is improper when competing evidence creates a triable issue on whether attorney negligence proximately caused loss of the underlying claim.

## Conclusion

The court held that malpractice causation must be proved through an objective reconstruction of the underlying claim by the malpractice factfinder, and that an ALJ’s retrospective affidavit on a hypothetical outcome cannot, by itself, eliminate factual disputes and justify summary judgment.


Phillips v. Clancy, 152 Ariz. 415, 733 P.2d 300 (Ariz. Ct. App. 1986)