Rucker v. Schmidt

Katherine Rucker (plaintiff) and Robert Rucker entered proceedings for the dissolution of their marriage. Katherine and Robert agreed to use an independent appraiser to determine the value of Robert’s 50 percent interest in a tile shop. They signed a marriage-termination agreement whose property-settlement award to Katherine was based on the appraiser’s valuation of Robert’s interest in the store. Their marriage was legally dissolved. Later, Katherine brought suit against Robert for fraud on the court, asserting he intentionally provided incorrect information to the appraiser to obtain an undervalued result. The district court found in Katherine’s favor and awarded her an additional sum. Robert appealed, but the claim was settled before the appeal was final. Katherine then brought suit against Steven Schmidt (defendant), the attorney who had represented Robert in the dissolution action, and Rider Bennett, LLP (defendant), the law firm that employed Schmidt. The district court found that Robert had a relationship of privity with Schmidt and Rider Bennett, invoking res judicata and barring Katherine’s claim. The district court granted summary judgment to Schmidt and Rider Bennett. Katherine appealed. The appellate court reversed and remanded, holding that an attorney-client-relationship does not constitute privity as a matter of law and that further inquiry was required as to the potential for an injustice against Katherine if res judicata were to be applied. Schmidt and Rider Bennet appealed. The Minnesota Supreme Court granted certiorari.