This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2000).
IN COURT OF APPEALS
National Title Company,
St. Louis County District Court
File No. C099602421
Keith M. Carlson, Carlson Law Firm, 807 Cloquet Avenue, Box 770, Cloquet, MN 55720 (for appellant)
Anthony S. Downs, Steven W. Schneider, Halverson, Watters, Downs, Reyelts & Bateman, Ltd., 700 Providence Building, 332 West Superior Street, Duluth, MN 55802 (for respondent)
Considered and decided by Toussaint, Chief Judge, Stoneburner, Judge, and Poritsky, Judge.*
Appellant Kenneth L. Poferl argues that the district court erred in granting summary judgment to respondent National Title Company. Because collateral estoppel bars Poferl’s claims against respondent, we affirm.
In 1996, appellant Kenneth L. Poferl agreed to make a private mortgage loan of $32,000 to Lynette Robinson and Dennis Pearson. Robinson and Pearson made arrangements with respondent National Title Company of Duluth, Minnesota, to complete the closing. Poferl, Robinson and Pearson agreed to the terms and interest rate of 14%, as set out in a promissory note used for a previous loan between Poferl and an acquaintance of Pearson’s. A copy of this note was provided to National Title, whose representatives completed the title abstract and drafted the necessary documents, including the promissory note for this loan and the mortgage deed. Poferl did not review these documents prior to the closing on June 6, 1996, which he attended without an attorney. Robinson and Pearson attended the closing with their attorney.
The terms of the promissory note required Robinson and Pearson to pay a 14% interest rate. Robinson and Pearson brought an action against Poferl, alleging the loan was usurious, and void as a matter of law. Poferl conceded that the loan was usurious but contended he had acted in good faith and had relied on National Title and counsel for Robinson and Pearson regarding the drafting of the promissory note and mortgage deed and assumed that the rate charged was not usurious. Poferl moved to implead National Title as a third-party defendant. The district court granted summary judgment in favor of Robinson and Pearson, and did not address Poferl’s motion to implead National Title. Poferl appealed.
This court affirmed the judgment. See Robinson v. Poferl, No. C6-99-1117, 2000 WL 53417 (Minn. App. Jan. 25, 2000). On the issue of usurious intent, this court found that Poferl had not acted in good faith, because he had not taken adequate precautions, such as retaining counsel or requesting the advice of other professionals, he had edited one of his previous loan agreements and instructed National Title to draft the promissory note for this transaction, and he had refused Robinson and Pearson’s offer to reform the loan agreement to establish a proper interest rate and consequently invited the lawsuit. Robinson, 2000 WL 53417, at *2. This court specifically stated that Poferl “had neither a good-faith basis to rely on respondents’ attorney, nor a good-faith basis to rely on National Title.” Id. On the issue of Poferl’s motion to implead, this court found that the district court had tacitly denied the motion, and because Poferl had conceded that National Title was not a necessary party, the district court had not abused its discretion. Id.
Poferl brought this lawsuit against respondent National Title before this court issued the opinion on his appeal. Poferl alleges that National Title was negligent in drafting the promissory note; engaged in the unauthorized practice of law; committed legal malpractice; and had an implied duty to indemnify him. The district court granted National Title’s motion for summary judgment, finding that the prior litigation collaterally estopped Poferl from asserting these claims against National Title.
Summary judgment is appropriate where 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 any material fact” and either party is entitled to judgment as a matter of law. W.J.L. v. Bugge, 573 N.W.2d 677, 680 (Minn. 1998) (quoting Minn. R. Civ. P. 56.03). On appeal from summary judgment, this court asks whether there are any genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).
Whether res judicata applies is a question of law reviewed de novo. Hennepin County v. Hanneman, 472 N.W.2d 149, 152 (Minn. App. 1991), review denied (Minn. Aug. 29, 1991). Collateral estoppel, or issue preclusion, is one of two forms of res judicata. Hauser v. Mealey, 263 N.W.2d 803, 806 (Minn. 1978). Collateral estoppel precludes parties from relitigating issues that are identical to issues previously litigated and which were necessary and essential to the former resulting judgment. Aufderhar v. Data Dispatch, Inc., 452 N.W.2d 648, 650 (Minn. 1990) (citing Ellis v. Minneapolis Comm'n on Civil Rights, 319 N.W.2d 702, 704 (Minn. 1982)). Collateral estoppel applies if four elements are met:
(1) the issue is identical to one in a prior adjudication; (2) there was a final judgment on the merits; (3) the estopped party was a party in the prior case; and (4) there was a full and fair opportunity to be heard on the issue.
In re Trust Created by Hill, 499 N.W.2d 475, 484 (Minn. App. 1993), review denied (Minn. July 15, 1993).
Poferl argues that the issue of usurious intent adjudicated in the prior action is not identical to the issues raised in this case. In the prior action, this court found Poferl had usurious intent. Violation of usury laws requires proof of four elements: (1) a loan of money or forbearance of debt; (2) an agreement between parties that principal shall be repayable absolutely; (3) exaction of a greater amount of interest or profit than is allowed by law; and (4) presence of intention to evade law at the inception of the transaction. Widmark v. Northrup King Co., 530 N.W.2d 588, 590 (Minn. App. 1995), review denied (Minn. June 14, 1995). Poferl argued in the prior litigation that he relied on the debtors’ attorney and National Title to draft the promissory note and mortgage deed. A lender is excluded from liability where he took reasonable precautions that indicated a purpose to act in good faith and comply with the usury law. Trapp v. Hancuh, 530 N.W.2d 879, 885-86 (Minn. App. 1995); see Wetsel v. Guaranteed Mortgage Co., 195 Minn. 509, 511-12, 263 N.W. 605, 606 (1935) (holding mortgage company acted in good faith by relying on schedules from certified public accountants and advice from reputable counsel). This court found Poferl did not have a good-faith basis for his reliance:
[A]ppellant did not take the precaution of retaining counsel or other professionals to advise him about the legality of the loan agreement. Instead, appellant edited one of his previous loan agreements and instructed National Title to draft the promissory note in accordance with his instructions. Accordingly, appellant had neither a good-faith basis to rely on respondents’ attorney, nor a good-faith basis to rely on National Title.
Robinson, 2000 WL 53417, at *2 (citation omitted). The conclusion that Poferl did not in good faith rely on his relationship with National Title was essential to finding he had usurious intent.
In this lawsuit against National Title, Poferl has asserted four theories of recovery: legal malpractice or negligent drafting, unauthorized practice of law and implied contract to indemnify.
A plaintiff must show the elements of legal malpractice: (1) the existence of an attorney-client relationship; (2) acts constituting negligence or breach of contract; (3) that such acts were the proximate cause of the plaintiff’s damages; and (4) that but for defendant’s conduct, the plaintiff would have been successful in the defense of the action. Blue Water Corp. v. O’Toole, 336 N.W.2d 279, 281 (Minn. 1983). In a legal malpractice action, an attorney-client relationship does not arise unless reliance on legal advice is reasonable under the circumstances. TJD Dissolution Corp. v. Savoie Supply Co., 460 N.W.2d 59, 62 (Minn. App. 1990). Similarly, to state a cause of action for unauthorized legal practice, plaintiffs must establish that (1) the conduct was in violation of the unauthorized practice statute; (2) the unauthorized practice statute creates a duty of care to plaintiffs; and (3) the breach of the statute was the proximate cause of some injury suffered by plaintiffs. Kronzer v. First Nat. Bank of Minneapolis, 305 Minn. 415, 421, 235 N.W.2d 187, 191, (1975); see Minn. Stat. § 481.02 (2000) (unauthorized practice of law statute). Poferl’s first two claims, unauthorized practice of law and legal malpractice, require proof of legal advice or a legal relationship and reasonable reliance upon that relationship to show causation.
This court has already determined that National Title and Poferl did not form a relationship, because it found that Poferl had not retained the advice of National Title. This court’s determination that Poferl did not have a good-faith basis to rely on the actions of National Title precludes proof of causation. Collateral estoppel precludes Poferl from relitigating his claims of legal malpractice and unauthorized practice of law.
Poferl’s third claim is an implied contract to indemnify. Indemnity arises out of a contractual relationship. Blomgren v. Marshall Management Servs., Inc., 483 N.W.2d 504, 506 (Minn. App. 1992). As indicated above, this court has previously determined that Poferl did not seek the advice of an attorney or any professional, or have a good-faith basis to rely on the actions of National Title. Collateral estoppel bars Poferl from relitigating the existence of such a relationship, without which no implied contract could arise.
Poferl argues for the first time on appeal that he is entitled to contribution, an equitable remedy when there is common liability among tortfeasors. Blomgren, 483 N.W.2d at 506. This court will generally not consider matters not argued and considered in the court below. Thiele v. Stich, 425 N.W.2d. 580, 582 (Minn. 1988). We will not consider Poferl’s claim for contribution.
The district court did not err as a matter of law in granting Poferl’s motion for summary judgment.
* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.
 This court’s previous decision on the motion to implead National Title does not impact the application of collateral estoppel in this case, because National Title need not have been a party to the previous action to invoke the doctrine.
 On appeal Poferl argues for the equitable remedy of contribution, not alleged in his complaint.