Articles Posted in Legal Malpractice Issues

In Massachusetts, professional negligence claims against an attorney must be filed within three years (M.G.L. c. 260 § 4). Fraud claims also have a three year statute of limitations (M.G.L. c. 260 § 2A). However, these periods do not begin to run until a client’s discovery of the actionable conduct. An Ohio appellate court has considered these issues under Ohio law and affirmed a lower court’s entry of summary judgment in favor of two attorneys in a legal malpractice case.

In DeFranco v. Judy, a woman was involved in a dispute with an Ohio county over whether a septic system on her property violated local health and zoning bylaws. In 1997, the woman hired an attorney to represent her in this matter, but he was unable to resolve the bylaw issues.
By 2004, the dispute was still ongoing, and the woman retained another attorney to represent her. The second attorney negotiated a favorable settlement, which included a future test of the septic system to determine if it was in violation. However, the woman refused to sign the agreement. The second attorney then successfully withdrew his representation. Several months later, the attorney confirmed that a test had not been performed.

In 2011, the county wrote a letter to the woman affirming that a test was never conducted. Consequently, the woman filed an action against both attorneys, alleging that they had committed malpractice and fraud by failing to ensure that the system was tested. The attorneys moved for summary judgment on the basis that the applicable statutes of limitations had expired. The trial court granted the motion and the woman appealed.

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In all jurisdictions, including Massachusetts, a plaintiff cannot maintain a malpractice claim against an attorney unless an attorney-client relationship exists. Spinner v. Nutt, 417 Mass. 549 (1994). Lawyers hired to advise trustees of trusts owe a duty of care to beneficiaries and other third parties only in rare circumstances. Id. at 553. An Ohio appellate court has analyzed these issues and affirmed a lower court’s decision granting a law firm’s motion to dismiss a legal malpractice suit.

In Nye v. Eastman & Smith, LTD, a husband and wife hired an estate planning attorney to establish two family trusts, one in each of their names. Under the terms of the trusts, the couple’s daughter was named successor trustee and sole beneficiary of each trust upon the death of both parents. The attorney would then succeed the daughter as trustee upon her death, and several charitable organizations were named the residual beneficiaries. The trusts also purchased life insurance policies on the lives of the trustees.

Fifteen years later, both parents had passed away and the daughter became trustee and sole beneficiary of both trusts. She wished to receive a greater income from the trusts and retained a new law firm to help her accomplish this goal. The firm advised her to surrender the insurance policies for their cash value, which she did. The cash value was substantially less than the death benefit.

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Under Massachusetts law, issues that have already been decided in a court of competent jurisdiction cannot be re-litigated in a subsequent action considering the same issue. Jarosz v. Palmer, 436 Mass. 526, 530 n.3 (2002). This holds true in most jurisdictions, including New Mexico, as summarized below.

A New Mexico appellate court has affirmed a lower court’s ruling that a client was precluded from bringing a legal malpractice action against his former attorney. In Potter v. Pierce, a client hired an attorney to represent him with respect to his bankruptcy proceedings. One year later, the client fired the attorney citing “a fundamental disagreement”. The attorney then filed an application in the bankruptcy court seeking his fees.

The client opposed the petition arguing that the attorney had committed legal malpractice. After hearing, the bankruptcy court ruled in favor of the attorney.

Ten months later, the client filed a legal malpractice suit against the attorney. The attorney moved for summary judgment, arguing that the client’s suit was precluded because the bankruptcy court had already decided the issue. The trial court agreed and the client appealed.

The appellate court affirmed, reasoning that the bankruptcy court had already assessed the nature and quality of the attorney’s representation. The court had impliedly determined that the attorney had exercised the skill or a reasonable lawyer and thus client could not re-litigate the issue.

Decision: Potter v. Pierce

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The attorney, provides the following case summary:

The Supreme Court of North Dakota has affirmed a trial court’s decision granting an attorney’s motion for summary judgment in a legal malpractice suit. In Johnson v. Bronson, a woman hired an attorney to represent her at a hearing to determine if she should be involuntarily committed to a mental health institution. At the hearing, it was determined that she should be hospitalized. However, she was released two weeks later.

The woman then filed a legal malpractice action alleging that the attorney negligently represented her at the hearing. The attorney moved for summary judgment, which the trial court granted. The women appealed.

The Supreme Court of North Dakota affirmed the lower court’s decision. In order to prove the causation element of legal malpractice, the client must show that but-for the attorney’s negligence, she would have achieved a better result in the underlying case. Relying on expert deposition testimony submitted in support of the attorney’s motion, the trial court properly found that the attorney’s conduct did not result in the woman’s hospitalization. Thus, summary judgment was appropriate.

Decision: Johnson v. Bronson

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The attorney, provides the following summary of a recent legal malpractice lawsuit:

A New York appellate court has affirmed a trial court’s decision denying a lawyer’s motion for summary judgment in a legal malpractice case. In Angeles v. Aronsky, a man was attacked in the entryway to his apartment building.

After the incident, the man hired an attorney to represent him in a premises liability suit against the owners of the building. Under New York law, to succeed in such an action, the victim must prove that the assailants were intruders and not lawfully permitted on the premises. In Massachusetts, the victim has to prove that the assault was the result of negligent security on the premises. Shortly after filing suit, the attorney reached a settlement with the owners of the building without conducting any investigation into the status of the attackers.

After the settlement, the victim brought a legal malpractice action against the attorney for compromising the true settlement value of his case. The attorney moved for summary judgment arguing that the victim could not prove that he would have prevailed in the underlying case, and therefore the attorney’s conduct did not result in any harm. The trial court denied the motion and the victim appealed.

The appellate court affirmed the lower court’s decision. In order to prevail on his motion, the attorney had to show that the attackers were not intruders and thus a further investigation would have been fruitless. Because the status of the assailants remained a disputed question of fact, the attorney was not entitled to judgment as a matter of law.

Decision: Angeles v. Aronsky

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The attorney, provides this analysis of a legal malpractice action against a New York lawyer:

A New York appellate court has affirmed a trial court’s decision granting summary judgment for an attorney in a legal malpractice action because the client could not prove that the attorney’s conduct caused him harm.

In Rutolo v Northey, a New York City police officer drafted a report, which identified certain environmental hazards at his precinct. After submitting the report to his superiors up to his retirement years later, the officer experienced adverse treatment from the department, including assignments to undesirable shifts, denial of leave time, and a transfer to a less popular precinct. The officer then hired an attorney to represent him in a lawsuit against the department for violation of his First Amendment rights.

At the time the case was filed, censorship of any speech, whether in the course of employment or not, could substantiate a claim for a First Amendment violation. However, while the case was pending, the Supreme Court of the United States ruled that speech made pursuant to an employee’s official duties could no longer be the basis of that employee’s claim. This new ruling would also apply to a similar claim filed in Massachusetts, because it is a federal decision.

Due to the change in the law, the client’s case was dismissed. The client then brought a legal malpractice suit against the attorney for his failure to amend the complaint to add a separate count, which the client alleged would have survived under the new law. The attorney moved for summary judgment, which the trial court granted finding that the report was made in the course of the officer’s employment the client could not have successfully stated a cause of action under the new law. The client appealed.

The appellate court agreed and affirmed the judgment for the attorney. Because the attorney’s failure to amend the complaint did not jeopardize the underlying case, the officer could not prove the causation element of his malpractice claim as a matter of law. Summary judgment was therefore appropriate.

Decision: Rutolo v Northey

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The attorney, provides the following summation of a recent legal malpractice lawsuit:

A California appellate court has affirmed a trial court’s decision in a legal malpractice action holding that an attorney was entitled to judgment because the client failed to present expert testimony demonstrating the attorney’s negligence. In Massachusetts, the same burden of proof would be placed on the claimant in a similar legal malpractice action.

In Lee v. Stearn, a client hired an attorney to bring a professional malpractice claim against her dentist, who then moved for summary judgment. The attorney attempted to contact all of the medical professionals who treated the client for her injuries, but none were willing to sign an affidavit to oppose the motion or act as an expert witness. The attorney failed to file any opposition or appear at a hearing on the motion. The court ruled in favor of the dentist.

The client then brought a claim for legal malpractice against the attorney. The case proceeded to trial, where the client failed to present any lay or expert witnesses. The court entered judgment for the attorney and the client appealed.

The appellate court affirmed. In order to prove her claim, the client had to show that the attorney’s conduct resulted in the adverse ruling in the underlying case. This required her to present her own expert showing that the dentist failed to meet the standard of care for a reasonable dentist. Having failed to present any such evidence, the attorney was entitled to judgment as a matter of law.

Decision: Lee v. Stearn

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The attorney, provides the following explanation of a recent legal malpractice case:

The United States District Court for the Middle District Pennsylvania has affirmed a recommendation from a magistrate judge denying a motion for summary judgment in a legal malpractice suit.

In Lefta Associates v. Hurley, a client hired an attorney to negotiate a loan transaction for a construction project. The client agreed to provide a guaranty for up to 25% of the principal loan amount. However, the loan closing documents, as negotiated by the attorney, contained a guaranty for 50% of the loan amount. The loan closed and the client began making payments to the lender.

Over one year later, the client discovered the attorney’s error and then sued him for malpractice. The attorney moved for summary judgment on the grounds that the suit was barred by a one-year statute of limitations. However, under Pennsylvania law, the statute is tolled until the client discovers, or reasonably should have discovered, the attorney’s negligence, which in this case was less than one year prior to the filing of the lawsuit. Thus, the action was timely. Under Massachusetts state law, the claimant has three years after they discover, or should have reasonably discovered the lawyer’s negligence to file a lawsuit.

Next, the attorney argued that the client’s damages were limited to the amount of the attorney’s fees paid under the parties’ retainer agreement. The magistrate judge disagreed, finding that the attorney’s argument only applied to malpractice claims arising from criminal litigation. In a civil context, the client is entitled to all consequential damages of the attorney’s negligent conduct, which included the amount of the excess exposure under the loan agreement.

The district court judge affirmed the magistrate judge’s findings and recommendations and entered an order denying the attorney’s motion for summary judgment.

Decision: Lefta Associates v. Hurley

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The attorney, provides the following synopsis of a legal malpractice action:

The Appeals Court of Louisiana has affirmed a lower court’s decision dismissing a legal malpractice action on the basis that it was time barred. In Williams v. CDY Development Corp, a tenant hired an attorney to renegotiate a commercial lease. At an initial meeting with the landlord, the parties agreed to a four year rental term. However, the attorney drafted and advised the tenant to sign a lease with a two year term and only a renewal option for an additional two years.

After the first two years passed, the tenant failed to exercise the option prior to the renewal deadline. The tenant then sent a letter to the landlord requesting to re-let the premises, but the landlord refused, citing the terms of the lease. Over one year later, the tenant brought a malpractice suit against the attorney for negligently preparing the lease agreement.

The attorney moved to dismiss the case arguing that it was barred because it was filed more than one year from the date that the plaintiff discovered or should have discovered the alleged malpractice. As a result, the trial court granted the attorney’s motion and the tenant appealed. In Massachusetts, the client would have been permitted to proceed with the lawsuit, because the statutes of limitations regarding a legal malpractice claim is three years from the date of discovery.

The appeals court affirmed finding that the tenant was aware of the terms of the lease at least since the time it sent its letter to the landlord. This was more than one year prior to filing the malpractice action and thus the case was properly dismissed.

Decision: Williams v. CDY Development Corporation

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