Legal Malpractice Law Review : Professional Responsibility Case Summaries & Commentary : Bennett J. Wasserman : LegalMalpractice.com : Lawyer Malpractice & Legal Ethics

Paul v. Gordon, 58 Conn. App. 724, 754 A.2d 851 (Conn. App. 2000)

Underlying real estate matter

Student Contributor: Laura Binski

Facts: The clients hired the lawyer to represent them in the negotiation of a lease (with option to buy). The clients had deposited $30,000 toward the purchase price when an issue arose regarding property repairs. The lawyer told the clients to stop paying rent to the landlord/seller. The landlord/seller began a summary process action. The lawyer told the clients he would “handle it.” Afterwards, the clients received no further communication from the lawyer. The clients were evicted and lost the $30,000 deposit. An investigation revealed that a default judgment for failure to appear had been rendered against the clients in the summary process action, yet the lawyer had never notified the clients of any court dates. The clients sued the lawyer for malpractice but did not disclose the names of any expert witnesses they intended to call at trial as is required by Connecticut law. The court granted the lawyer’s motion to preclude expert witnesses and ultimately granted the lawyer’s motion for summary judgment.

Issue: Was expert testimony necessary in the malpractice action to establish the negligence of the lawyer in the handling of the underlying summary process action?

Ruling: No. As a general rule, Connecticut requires plaintiffs in a legal malpractice action to introduce expert testimony to establish the standard of professional skill or care. However, an exception to this rule applies when “there is such an obvious and gross want of care and skill that neglect is clear even to a layperson.” Davis v. Margolis, 215 Conn. 408, 416 n. 6, 576 A.2d 489 (1990). In this case, expert testimony was unnecessary due to the lawyer’s failure to do anything at all to protect the clients’ interests.

Lesson: “The requirement of expert testimony in malpractice cases serves to assist lay people, such as members of the jury and the presiding judge, to understand the applicable standard of care and to evaluate the defendant’s actions in light of that standard.” Davis v. Margolis, 215 Conn. 408, 416, 576 A.2d 489 (1990). In this case, the lawyer told the clients he would “handle it,” and then basically abandoned the case without notice to the clients. A layperson would not have needed the help of an expert to determine that the lawyer here behaved with gross want of care and skill when his lack of action resulted in the clients’ eviction, relocation expenses, and loss of $30,000 deposit.

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Bolton v. Crone, 162 N.C. App. 171, 589 S.E.2d 915 (2004)

NC: Underlying Real Estate Transaction

Student Contributor: Vanessa L. Wachira

Facts: In September 2002, Billy Wendell Bolton (Client) brought an action for legal malpractice against John W. Crone, III and the firm of Gaither, Gorham & Crone (Attorneys) alleging that, during a real estate transaction for which he had retained their services in February of 1999, Attorneys failed to advise him that the land he sought to purchase for commercial purposes was restricted by covenant to residential use only. In their motion to dismiss the action for its failure to comply with the statute of limitations, Attorneys submitted Client’s answer to their September 2001 complaint as documentary evidence to rebut the claim that they failed to supply Client with the information. Consequently, their motion was transformed to a motion for summary judgment.

Issue: Was the court correct to look to Client’s answer to Attorneys’ complaint in granting a dismissal? If so, did Client’s answer constitute an admission of having been informed of the restrictive covenant, and thereby resolve all issues of material fact and relieve Attorneys of malpractice liability?

Ruling: Yes. In NC, the statute of limitations for a legal malpractice action is three years. Because Client failed to file his claim until seven months after the deadline, a motion to dismiss would readily have been granted. However, in accordance with NC law, a motion to dismiss that includes extrinsic material not excluded by the trial court will be treated as a motion for summary judgment. The standard of review for summary judgment requires the court to look to the facts of the case. The court found that, in response to allegations that Client had received letters in 1999 informing him of the covenant, Client’s answer merely indicated that some of the firm’s attorneys had informed him that they had reason to believe the land was subject to a restrictive covenant; this answer was not a specific denial as was required by the complaint. Client’s failure to specifically deny receipt of the letters was deemed an admission, which thereby resolved all issues of material fact. Having had knowledge of the covenants in February 1999, Client’s claim against Attorneys was barred by the statute of limitations.

Lesson: Although judgment was issued in favor of the attorneys, the attorneys’ mistake of submitting outside evidence to the court in conjunction with a motion to dismiss created a need for the court to further analyze a claim that otherwise could have readily been dismissed. Failing to pay attention to the basic principles of civil procedure could have serious consequences; fortunately, for the attorneys in this case it didn’t.

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Goodstein v. Allen, 222 Va. 1, 278 S.E.2d 787 (Va., 1981)

VA: Underlying contract and tort actions

Student Contributor: Karen Dindayal

Facts: In June 1972, Joseph S. Goodstein and Sheldon Ruben, individually and trading as G & R Associates (G & R) entered into a contract to purchase a tract of land. G & R Associates hired attorneys Allen S. Buffenstein, Jay M. Weinberg and Hirschler & Fleischer to examine the title and to counsel G & R on the purchase of the property.
In 1974, Hirschler & Fleischer filed suit on behalf of G & R against Froehling & Robertson, a survey company, for negligence in its land survey. Then, on June 16, 1975, Hirschler & Fleischer withdrew as counsel for G & R. G & R then mended their motion for judgment and added Hirschler & Fleischer defendant, claiming tort damages against Hirschler and Froehling, and alleged fraud and professional negligence against Hirschler, seeking compensatory and punitive damages.
The trial court found a misjoinder of parties and misjoinder of actions, severed the lawsuits, and required G & R to decide whether to proceed with the action in tort or in contract. G & R opted to proceed in tort, and the contract action was dismissed without prejudice.
G & R then filed another amended motion for judgment against Hirschler based on tort liability, and Hirschler pleaded the statute of limitations. The trial court sustained Hirschler’s plea and G & R appealed.
Thereafter, in August 1977, Hirschler then sued G & R for attorneys' fees for services rendered in the suit against Froehling. G & R filed a counterclaim seeking damages for breach of contract. Hirschler then filed a special plea in bar and plead the statute of limitations.
Meanwhile, the court affirmed the judgment in the tort action. The lower court sustained Hirschler’s two pleas and dismissed G & R’s counterclaim for breach of contract as barred by the doctrine of res judicata.

Issue: Did the trial court err in sustaining the special plea and the plea of the statute of limitations?

Ruling: No. The judgment regarding the tort statute of limitations was res judicata with respect to the contract action because it arose out of the same wrong as the first, tort action.

Lesson: In contract and tort suits for legal malpractice, if the contract remedy arises from the same wrong as the tort remedy, and, if the statute of limitations has not tolled as to one action, then it has is not tolled as to the other.

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Wood v. Hollingsworth, 166, N.C. App 637, 603 S.E.2d 388 (2004)

NC: Underlying Personal Injury Claim

Student Contributor: Vanessa L. Wachira

Facts: After sustaining injuries in an automobile accident on March 8, 1997, Client retained the services of Barbara Hollingsworth (Attorney).  In December 1999 Client instructed Attorney to file suit against the other driver.  In February 2000, Attorney informed Client that her office would be closing and advised her to seek other counsel.  Accordingly, Client terminated Attorney’s services.  After retaining new counsel on April 4, 2000, Client was informed that no lawsuit had been filed on her behalf. The statute of limitations on Client’s personal injury claim had run on March 8, 2000.  Client brought a malpractice action against Attorney, alleging that she failed to exercise reasonable care and diligence, failed to keep her informed as to the status of her case and failed to provide legal services in accordance with the standards of the practice.  The trial court dismissed the action, holding that Client failed to state a claim.

Issue: Was Client’s claim for negligence in legal representation properly dismissed for its failure to state a claim because no attorney-client relationship existed at the time of the injury?

Ruling: No.  In NC, an attorney will be liable for injuries sustained by her client that are a result of her failure to act with the reasonable care and diligence required by someone of her profession.  These acts include a duty to keep her client informed as to the status of her case.  Here, because Client’s complaint listed specific actions and inactions of her attorney that revealed Attorney’s failure to comply with the standards of her profession, Client’s complaint sufficiently stated a claim for malpractice.  Although the attorney-client relationship ended approximately one month before the statute of limitations ran, privity was still present when the events that gave rise to her injury occurred.  The foreseeable of the injury and the inaction of Attorney were sufficient to establish proximate cause. 

Lesson: In an action for malpractice predicated upon a former-Attorney’s failure to comply with the statute of limitations, it is important to remember that the acts that give rise to the injury sustained by the Client occur during the period in which the Attorney could have but failed to file the action and not on the date on which the statute of limitations runs.  

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Allred v. Rabon, 572 P.2d 979 (1977)

OK.: Underlying employment action

Student Contributor: Manju Sunny

Facts: Client is seeking damages from two attorneys for legal malpractice. The underlying action was the recovery of damages for the breach of an employment contract. Because of the death of the defendant in the underlying case, attorneys brought suit against the executrix but failed to file a claim. Attorneys then amended the petition on behalf of their client, which later lead to the case being dismissed because executrix said that plaintiff did make a demand within the two months. Ultimately, plaintiff filed actions against his attorneys for malpractice, claiming their failure to file a claim with the executrix, which barred his contract action forever. Also, plaintiff alleges that the attorneys fraudulently attempted to conceal their error by filing the amended petition and by advising him to dismiss the case because he had no hope of prevailing. Client seeks actual damages for attorneys’ negligence plus exemplary damages for fraud in concealing their negligence.

Issue: Whether attorneys’ failure to present the claim within the two months of date of first publication of notice to creditors constitutes negligence?

Ruling: No. The law at the time of dismissal was not clear as to the necessity of filing a claim against the estate in a case such as this. An attorney who acts in good faith and in honest belief that his advice and acts are well founded and in the best interest of his client is not answerable for mere error of judgment or for a mistake in a point of law which has not been settled by the court of last resort in his State and on which reasonable doubt may be entertained by well informed lawyers. Because the point of law upon which defendant attorneys reached possibly an erroneous conclusion was unsettled at the time the conclusion was made, attorneys could not be held liable for such error.

Lesson: This situation is not the same as the negligence of an attorney in allowing a staute of limitations to run against his client’s cause of action before he institutes a suit that has been entrusted to him. Here, the suit was filed but was dismissed by the plaintiff before  the court had acted.

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Composition Roofers,etc. v. Katz 398 Pa. Super. 564; 581 A.2d 607 (1990)

PA Underlying Criminal Action

Student Contributor: Natalie Resto

Facts: The Union retained the attorney to advise it on all legal matters. Thirteen of the Union’s former members were indicted for its alleged criminal attempts to benefit the Union and its members. The attorney advised the Union that they could lawfully pay the legal expenses of the 13 members who were under indictment. The 13 members were later convicted of 152 criminal counts, including racketeering and mail fraud. The attorney then advised the Union that it was lawful for it to pay for the appeals of the now convicted former members. The Union later sued the attorney for malpractice claiming that the attorney was negligent in advising it that could lawfully pay the attorneys’ fees to defend its officers who were charged with criminal activity.

Issue: Is an attorney negligent if his informed judgment is later found erroneous?

Ruling: The court held that because at the time the attorney advised the Union there was no clear statement of the law on which he could base his recommendation, his advice that the Union could lawfully pay the attorneys’ fees to defend its officers charged with criminal activity was not negligent.

Lesson: An attorney is negligent in a malpractice case if he fails to use ordinary skill, knowledge and care which would normally be possessed and exercised under the circumstances by members of the legal profession. McPeake v. William T. Cannon, Esquire P.C., 381 Pa. Super. 227, 553 A.2d 439 (1989). [However,] [a]n informed judgment on the part of counsel, even if subsequently proven erroneous, is not negligence. Mazer v. Security Insurance Group, 368 F.Supp. 418 (E.D.Pa. 1973), affirmed 507 F.2d 1338 (3rd Cir. 1975). 

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Breen v. Law Office of Bruce A. Barket, P.C., 52 A.D.3d 635, 862 N.Y.S.2d 50 (2nd Dept. 2008)

NY: Underlying Divorce Settlement

Student Contributor: Daniel Schick

Facts: During the course of resolving a divorce action, Eileen (“Plaintiff”), and her former husband, George, executed various stipulations of settlement to resolve their respective equitable distribution claims as to their marital assets. Eileen and George jointly owned two parcels of land in Connecticut, initially conveyed to them by a single deed. In their agreement, George agreed to pay purchase Plaintiff’s interest in one parcel, whereas the second parcel would be sold with the proceeds being divided equally between them. George retained a Connecticut attorney, Hecht, to draft a quitclaim deed which would transfer Plaintiff’s interest in one of the parcels to George. Plaintiff reviewed the proposed deed and noted that it erroneously described both parcels of property. She showed her attorney (“Defendant”) this draft document and discussed the error with him. Nonetheless, Plaintiff signed the quitclaim deed upon her counsel’s advice conveying her interests in both parcels of land to her former husband. Plaintiff sued Defendant and Hecht inter alia for legal malpractice. Defendant in turn filed cross-claims against Hecht for contribution or indemnification. Hecht made a motion for summary judgment dismissing Plaintiff’s complaint as well as Defendants’ cross-claims as a matter of law. The lower court denied Hecht’s motion. On appeal, the Appellate Division reversed the lower court holding that summary judgment should be granted dismissing the complaint and all cross-claims asserted against Hecht.

Issue: Can Plaintiff sue her former husband’s attorney for legal malpractice, especially when she lost a contracted for benefit because of the erroneous property description contained in the quitclaim deed Hecht drafted?

Ruling: No. Absent special circumstances such as fraud, collusion or malicious acts, which are not present here, Hecht will never be liable to third parties such as Plaintiff for the harm caused by his alleged professional negligence, because this attorney was never in privity or near privity with Plaintiff as there was no attorney-client relationship between them.

Lesson: In the absence of an attorney-client relationship or a relationship closely resembling privity between the parties, a third party wronged by an attorney’s professional negligence will only be able to sustain a claim of legal malpractice against that attorney, if facts can be shown that the attorney engaged in common scheme or plan with his client to defraud that third party.
 

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Knopick v. Connelly, U.S.D.C., M.D. Pa., January 25, 2010.

Facts: Knopick retained the services of the Defendant attorney in or about March 2007 order to pursue a claim for legal malpractice against his former attorneys in a divorce proceeding.  The Defendant attorney, however, refused to pursue the action and advised that Knopick statute of limitations for the legal malpractice action had expired.

In July, 2009, Knopick sued the Defendant attorney for malpractice, under tort and contract theories of liability, for failing to pursue the malpractice action his former divorce attorney.  The Defendant attorney moved for summary judgment.

Issue: Could Knopick establish a prima facie case against the Defendant attorney under either the tort or contract theory of liability? 

Ruling: No.

The Court first noted that under a tort theory of liability, Plaintiff must show: 

1) The employment of the attorney or other basis for duty;
2) The failure of the attorney to exercise ordinary skill and knowledge; and
3) That such failure was the proximate cause of the damage to the plaintiff.

Here, the Court found that the Defendant attorney's analysis that Knopick was out of time to pursue a malpractice action against his divorce attorney was correct.  Knopick should have brought the malpractice action two years from the date he first became aware of the negligence - by August, 2006.  However, he had no even retained Defendant's services until March, 2007.  Accordingly, there was no failure on Defendant's part to exercise ordinary skill or knowledge.

With regard to Plaintiff's contract theory of liability, the Court noted that "a plaintiff may not couch a tort negligence claim as a contract claim simply to side-step the two-year limitation period."  The Court further provided: 

Plaintiff discusses the standard of care owed by an attorney, not a breach of specific terms of the contingent fee agreement...Merely reciting the language "specific terms of the contract" without citing which terms the parties breached, is insufficient...In addition, the implied duty of care owed by every attorney to their clients is insufficient to support a breach of contract claim...Further evidence that this is a negligence claim couched as a breach of contract claim, is the fact that the language contained in Count Three directly mirrors the language contained in Count Two-Plaintiff's legal malpractice tort claim.

Accordingly, the Court dismissed Plaintiff's complaint.

Lesson: When an attorney is retained after the applicable statute of limitations has expired, he is not negligent in failing to pursue that action.  Moreover, plaintiff cannot pursue a contract theory of liability to avoid the two year statute of limitations applicable in Pennsylvania to legal malpractice actions.  To pursue a contract theory of liability, plaintiff must be able to point to a specific provision of the retainer that was violated other than an attorney "implied duty of care."

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Farnsworth v. O’Doherty, 85 Conn. App. 145, 856 A.2d 518 (2004).

CT: Underlying negligence case

Student Contributor: Laura Binski

Facts: In 1994, the clients hired the lawyer to help them recover money after the alleged negligent construction of an addition to their home. In 1995, the lawyer filed a complaint for the clients against the building contractor, the building engineer, and the town of Branford. Later that year, the lawyer no longer represented the clients. The clients were unsuccessful in their suit because the town engineer and the town claimed governmental immunity and the building contractor filed for bankruptcy. In 2001, the clients filed a legal malpractice complaint against the lawyer for negligence in failing to name the town building inspector as one of the defendants and failure to assert reckless and wanton disregard for health and safety in the complaint. The lawyer successfully moved for summary judgment on the grounds that §52-577 (the statute of limitations) barred the clients from suing her. The clients now appeal.

Issues: Does the statute of limitations prevent from bringing a legal malpractice claim against the lawyer? May the clients toll the statute of limitations claim under the doctrine of continuous representation?

Holding: Yes and no. §52-577 provides that “no action founded upon a tort shall be brought but within three years from the date of the act or omission complained of.” Since the clients did not file the suit until more than four years after the alleged negligence conduct of the lawyer, they are time barred by the statute of limitations. The continuous representation rule provides that clients may toll the statute of limitations upon a showing that (1) the lawyer continued to represent them with regard to the same underlying matter and (2) either that the client was unaware of the alleged malpractice or the lawyer could still diminish the harm caused by that malpractice during the continued representation period. DeLeo v. Nusbaum, 263 Conn. App. 588, 821 A.2d 744 (2003). Since the lawyer ceased representation of the clients, they have failed the first prong of the continuous representation test and may not toll the statute of limitations.

Lesson: §52-577 is an “occurrence statute,” meaning that the time period within which a client must file a complaint begins at the exact time when the negligence complained of occurs, not the date when the client sustains damage. The “continuous representation” doctrine was established to ease the harsh consequences of the occurrence rule.
 

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