Sotelo v. Stewart, 281 S.W.3d. 76 (Tex App. 2008)

TX: Underlying Contract law

Student contributor: David Yanoff

Facts:  Defendant had represented plaintiff’s husband in a breach of contract action. The husband had signed a contract to purchase real property in 1991, to which plaintiff was not a party. When he defaulted, a judgment of $82,000 was entered against him in December 1994. Defendant had withdrawn from representing the husband in March, 1994, but not before filing a motion for continuance (February 1994) in which he added plaintiffs name to the caption, allegedly without her knowledge or consent. Plaintiff and her husband divorced in 2000. In August 2001, a third party obtained a writ of execution for the breach of contract action and had some of plaintiff’s property sold at a sheriff’s sale. Plaintiff filed suit, alleging that defendant had committed legal malpractice by making her a defendant in the breach of contract case in the absence of any allegations against her. Defendant moved for summary judgment, alleging lack of duty and statute of limitations defenses. Plaintiff argued in response that a fact issue remained with respect to limitations, as the discovery rule tolled the accrual of her cause of action. She produced an affidavit from her daughter explaining that all certified mail to the residence was delivered directly to plaintiff’s husband, without plaintiff seeing it. Plaintiff also contended that fact issues remained regarding the existence of an attorney-client relationship. The trial court granted summary judgment for defendant, and plaintiff appealed.

Issue(s):

 1) Does a triable issue of fact exist with respect to the discovery rule when a plaintiff claims she did not learn of her harm because she didn’t get the mail?

2) If an attorney adds a party’s name to a caption, does that create an attorney client relationship automatically?

Ruling(s):

1) Yes. Even if it seems far-fetched, it is up to the trier of fact to determine if a plaintiff’s witness is credible. Plaintiff’s daughter testified that plaintiff didn’t and couldn’t have learned of defendant’s acts until after her divorce, and the court cannot ignore that testimony.

2) Maybe not, but it does create a triable issue. In a summary judgment motion, the defendant must prove the non-existence of such a relationship as a matter of law. Because an attorney-client relationship can be implied in various instances, including from an attorney’s gratuitous rendering of professional services, any evidence suggesting an implied relationship can defeat a summary judgment. This does not mean that a relationship does exist, only that it might.

Lesson(s):  Texas has a relatively lenient discovery rule. Actions may still be viable years after the limitations period should have expired if a plaintiff can show that he/she could not reasonably have discovered the wrong/harm any earlier. In cases of fraudulent concealment, this is a given.
An attorney-client relationship is not as hard to show in Texas as in some states. While it generally requires privity of contract, oral or written, it can also be implied.