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

Kathy Lynn Darrow v. Steven E. Zigan, Esq., et al., 2009 Ohio 2205 

Student Contributor: Shiv Vydyula

Facts: Plaintiff contends that she was a third party beneficiary in the underlying divorce action, and therefore, in privity with the defendant attorney. By way of explanation, she provided that the attorney for her ex-husband told her he would draft the necessary documents to quit-claim the husband’s interest in their marital residence and prevent her from exposure to the home equity loan the ex-husband took before their marriage.

Ultimately, a collector placed a lien on the property. Plaintiff then filed suit claiming she was a third party beneficiary because she relied on opposing counsel’s promise to draft documents that would release her from liability on the loan. 

Issue: Does opposing counsel’s promise to complete a quit-claim deed create a privity sufficient to pursue a claim for legal malpractice?

Ruling: No. 

In Ohio, attorneys have qualified immunity against the claims of third parties which arise from actions taken while representing their clients...Unless a third party can establish that it is in privity with the client, or that the attorney acted with malice, the attorney is not liable to the third party.

In line with precedent, the controlling factor here was that there was no attorney-client relationship between the attorney and the plaintiff. Nor was there any privity because their interests were clearly at odds. 

Lesson: A promise made by opposing counsel is not sufficient to satisfy the burden of privity in an Ohio legal malpractice action.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Berry et al. v. Javitch, Block & Rathbone, L.L.P., 182 Ohio App.3d 795 (2009).

Student Contributor: Shiv Vydyula

Facts: The Berrys commenced suit for negligent concealment and alleged that defendants committed fraud when they failed to disclose that they were insured for malpractice by Clarendon National Insurance Co. Defendant(s) only disclosed a policy from Legion Insurance, which did not cover the time period of the Berrys'  claim.

This failure to disclose prevented the plaintiffs from asserting a claim against the appropriate carrier-- Clarendon. Defendants agreed to settle the matter for $195,000, $65,000 of which was to be paid up front by Defendants. Defendants would then have 90 days to get Legion to satisfy the balance of the claim. If payment was not made in 90 days, the Berrys could proceed directly against Legion. This, despite the fact that the parties' agreement provided that Legion had disclaimed coverage. Legion never paid the remaining $135,000. 

Eventually, the Berrys filed suit for fraudulent inducement against defendants. The trial court granted summary judgment in favor of the defendants without opinion. The Berry appealed the trial court's decision and argued that they had valid claims for fraud against defendants. 

Issue: Does failure to disclose a malpractice policy amount to fraud?

Ruling:  Yes, if the following prerequisites are met: 

(a) a representation or, where there is a duty to disclose, the concealment of a fact (b) that is material to the transaction at hand, (c) was made falsely, with knowledge of its falsity, or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred, (d) with the intent of misleading another into relying upon it, and (e) justifiable reliance upon the representation or concealment, (f) with a resulting injury proximately caused by the reliance. 

The appellate court remanded on the issue of whether the failure to disclose was purposeful in light of the fact that Defendants had notified Clarendon of the suit, yet answered Plaintiffs' interrogatory requesting information regarding any policy which "may" provide coverage with only Legion. 

Lesson: Under Ohio law, Intentional concealment of an applicable malpractice insurance policy could amount to fraud.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Fincher v. Phillips, 2011 Ohio 968, Court of Appeals of Ohio, March 4, 2011.

Facts: Phillips represented Fincher in the negotiation of a plea in the underlying criminal matter. Phillips charged Fincher $15,000. After the plea was entered into and Fincher was sentenced to eight years in prison, he sued Phillips for legal malpractice and alleged that his fee was unreasonable. 

In an affidavit, Phillips provided an expert opinion that his representation had not breached the standard of care, and that the $15,000 retainer was a reasonable fee that was based on his specialized knowledge, professional skill and judgment. Fincher filed a brief in opposition to the motion, but failed to furnish any contrary expert testimony in support of his claim of unreasonable legal fees.

The trial court ruled in favor of Phillips in light of FIncher's failure to produce an expert report. 

Issues: Was expert opinion necessary to contest the reasonableness of Phillips' attorney's fees.

Ruling: Yes. 

The Court of Appelas ruled: 

The determination of legal fees involves several factors including the time and labor required, the difficulty of the issues involved, and the requisite skill needed to provide the legal service. Prof.Cond.R. 1.5. This is not within the ordinary knowledge of laymen. Establishing malpractice for charging excessive fees clearly necessitates expert testimony.

In his motion for summary judgment, appellee provided expert testimony that the $15,000 retainer was reasonable. Appellant's brief in opposition provided no expert testimony or other evidence refuting this claim. Unopposed expert testimony is sufficient to determine that there is no genuine issue of material fact.

Lesson: In Ohio, the former client will not be able to successfully contest the reasonableness of a claim for unpaid attorney's fees without expert testimony. 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Tolliver v. McDonnell, 155 Ohio App.3d 10 (2003).

OH: Underlying criminal defense; ineffective assistance of counsel.

Student Contributor: Shiv Vydyula

Facts: Because appellant Tolliver was indigent, the court overseeing his indictment for conspiracy and for murder appointed McDonnell as his attorney. A jury acquitted Tolliver of murder but found him guilty of conspiracy to commit aggravated murder. The court sentenced Tolliver to a term of incarceration. A few months after, McDonnell withdrew as Tolliver’s counsel. The court appointed new counsel for purposes of appeal. Tolliver instructed his new counsel to file a claim for ineffective assistance of counsel alleging that McDonnell had failed to assert a defense for the conspiracy charge where the statute of limitations had run on that charge. The trial court dismissed Tolliver’s legal malpractice claim against McDonnell as untimely. Tolliver claims though that the statute of limitations tolled until the court rendered the opinion in the appeal of the criminal action.

Issue: Did the statute of limitations on the legal malpractice claim effectively toll until the court ruled on the appeal in the criminal matter?

Ruling: The court ruled that the claim was untimely. The court leaned on case law that supported that cognizable events begin the statute of limitations focus on what the client is aware of and not on extrinsic judicial determinations. The court ruled that the cognizable event here was when Tolliver instructed his new counsel to file the appeal.

Lesson: Cognizable events and their analysis seem to lean towards prevention. Here, it prevents the attorney being sued for malpractice from being exposed to suits with overly broad statutes of limitations for bringing claims. Clearly the outcome in the criminal case suggests there was something that McDonnell could have seen, but ultimately, the statute of limitations saved him.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Bohan v. Jackson, Court of Appeals of Ohio, July 22, 2010. 

Facts:  Shortly prior to his death, Bohan's father indicated his desire to his attorney, Kennedy, to amend a revocable trust to make Bohan the sole beneficiary.  The father executed a handwritten statement, in Kennedy's presence, directing his firm to amend the trust agreement accordingly.  The father died two days later, and Kennedy's firm had not amended the trust agreement.  Kennedy thereafter advised Bohan that the handwritten note was not a legal document that could alter the terms of his late father's trust. 

Bohan then brought a malpractice action against Kennedy's firm.  The lower court dismissed the action for failure to name a party against whom relief could be granted and Bohan appealed.

Issue:  Is it necessary to name an individual attorney, or can relief for legal malpractice be awarded only against a law firm? 

Ruling:  The Court of Appeals held that "a law firm does not engage in the practice of law, and therefore, cannot directly commit legal malpractice."  Accordingly, by naming only the firm as a defendant, Bohan failed to name a party against whom relief could be granted.

The Court further noted that Bohan's action would have been dismissed for lack of privity, even if he had named Kennedy individually.  Here, the trust at issue was revocable.  Accordingly, Bohan's interest did not vest until his father's death.  Without a vested interest in the trust, Bohan was not in privity with the firm, and therefore, could not prove an essential element of a legal malpractice action -- that Kennedy, or his firm, owed Bohan a duty of care.

Lesson:  Under Ohio law, an action for legal malpractice against a law firm alone is not viable. Further, plaintiff must be able to establish an attorney-client relationship or privity with the defendants.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Taylor v. UAW-GM Legal Services Plan, et al., United States District Court, N.D. Ohio, August 13, 2010.

Facts: Plaintiff, a participant in the UAW-GM Legal Services Plan, filed the instant action for legal malpractice, breach of contract, and quantum meruit against the Plan after requesting and, allegedly, receiving negligent legal services from a Plan attorney.

In bringing the three causes of action, Plaintiff alleged that she was improperly denied benefits, i.e. competent legal services,  under the Plan.  The lower court dismissed her cause of action, in part, because the her state law claims were preempted by the federal statute governing the Plan, the Employee Retirement and Income Security Act ("ERISA").

Issue:  Is a claim for legal malpractice preempted where it arises from an attorney's negligence to provide services that are governed by a federal statute? 

Ruling:  Yes, if the Plaintiff's allegations rely upon the attorney's failure to provide services governed by the federal statute.

Despite their different captions, all three claims allege that Defendants denied Plaintiff the legal services she was entitled to under the Plan...It is not the label placed on a state law claim that determines whether it is preempted, but whether in essence such a claim is for recovery of an ERISA plan benefit...This is not to say that all common law legal malpractice or quantum meruit claims against plan attorneys would be preempted by ERISA.  But the thrust of Plaintiff's allegations in this case is that she was improperly denied benefits under the Plan.

Lesson:  Plaintiffs must be careful in how they frame their claim of legal malpractice.  Alleging denial of benefit under a particular plan governed by ERISA may void the state law negligence claim, whereas an allegation of breach of the standard of care applicable to attorneys, independent of plan benefits, may preserve the malpractice claim.

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

Natl. Union Fire Ins. Co. of Pittsburgh, PA v. Wuerth, 122 Ohio St.3d 594, 2009-Ohio-3601

Underlying Action: Insurance (Ohio)

Student Contributor: Candice L. Deaner

Facts: The plaintiff retained a law firm’s partner, Wuerth, to defend them against a lawsuit. During the trial, Wuerth informed partners and the trial judge that he was sick and subsequently was taken to the hospital. His doctor advised the court that Wuerth was not capable of continuing with the trial. His firm filed an unsuccessful motion for a mistrial, then assigned attorneys to complete the trial. Plaintiff lost the trial and filed suit claiming that Wuerth had committed legal malpractice, that his firm was vicariously liable for Wuerth’s malpractice, and that the firm itself committed malpractice. While Plaintiff alleged wrongful acts by the firm, Wuerth was the only individual named as a defendant in the complaint. On a motion for summary judgment, the district court dismissed Wuerth from the action because Plaintiff had filed its complaint after the expiration of the one-year statute of limitations under Ohio law. Because the statute barred them against Wuerth, the district court also dismissed claims for vicarious liability against firm. Finally, the district court determined that the firm cannot be held directly liable for legal malpractice because it is not an attorney and does not practice law and Plaintiff appealed.

Issue: Can a legal malpractice claim be maintained directly against a law firm when all of the relevant employees have either been dismissed from the lawsuit or were never sued in the first instance?

The Ruling: The Supreme Court of Ohio held a law firm is vicariously liable only when one or more of its principals or associates are liable for legal malpractice:

 “Although a party injured by an agent may sue the principal, the agent, or both, a principal is vicariously liable only when an agent could be held directly liable the liability for the tortuous conduct flows through the agent by virtue of the agency relationship to the principal. If there is no liability assigned to the agent, it logically follows that there can be no liability imposed upon the principal for the agent’s actions.”

The Lesson: A law firm as an entity does not engage in the practice of law and therefore cannot commit legal malpractice directly. A law firm cannot be vicariously liable for legal malpractice unless one of its principals or associate attorneys is found liable for malpractice.

• Email This
• Print
• Comments
• Trackbacks
• Share Link