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

Jocer Enterprises, Inc. v. Ernest Price at al., Court of Appeals of California, Second District, Division Four, 183 Cal. App. 4th 559 (April 5, 2010).

Facts:  Allegedly, the defendant attorney provided negligent legal representation in trade secret and malicious prosecution actions and plaintiffs suffered damages as a result.  The defendant attorney was absent from California during the year preceding the filing date of the plaintiffs' malpractice action. The defendant attorney argued that plaintiffs' action was time-barred under California's one-year statute of limitations for legal malpractice actions.  Plaintiffs' contended the applicable statute of limitations was tolled during defendant's absence from California.

Issue:  Does an attorney's absence from the state toll the statute of limitations for legal malpractice actions in California? 

Ruling:  Yes. 

California's statute of limitations for legal malpractice actions provides: 

An action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first.

The limitations period contains certain tolling provisions which provide: 

[I]n no event shall the time for commencement of legal action exceed four years except that the period shall be tolled during the time that any of the following exist:

(1) The plaintiff has not sustained actual injury;

(2) The attorney continues to represent the plaintiff regarding the specific subject matter in which the alleged wrongful act or omission occurred;

(3) The attorney willfully conceals the facts constituting the wrongful act or omission when such facts are known to the attorney, except that this subdivision shall toll only the four-year limitation; or 

(4) The plaintiff is under a legal or physical disability which restricts the plaintiff's ability to commence legal action.

With the exception of provision (3) each tolling provision applies to both the one-year and four-year limitations periods for legal malpractice actions.  

In making a determination as to whether plaintiffs' action was tolled during the time the defendant attorney was absent from California, the Court relied on Bledstein v. Superior Court.  In Bledstein, the Court tolled plaintiff's time to file a legal malpractice action for four years while plaintiff was incarcerated on criminal charges.  The Court drew a parallell in the instant action and held that an attorney's absence qualifies as a "legal disability" which, essentially, restricts plaintiff's ability to pursue his malpractice action against his former attorney.

Lesson:  In California, the limitations period for legal malpractice actions will be tolled during the time the defendant attorney is out of the state.  

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

Aduddell v. Parkhill, 821 S.W.2d 158 (Tex. 1991)

TX: Underlying asbestosis personal injury clam; statute of limitations

Student Contributor: Jean Moss Sullivan*

Facts: Plaintiff was diagnosed on April 24, 1983 with asbetosis and retained the defendant lawyers to sue asbestos manufacturers for plaintiff’s injuries. The plaintiff’s statute of limitations for the asbestos injuries expired on April 24, 1985. Lawyers did not file the suit until May 20, 1985. The federal district court entered judgment for the asbestos manufacturers because the plaintiff’s claim was filed after the 2-year statute of limitations.
Plaintiff sued Lawyers for breaches of express and implied warranties under the Deceptive Trade Practices Act and for negligence. Lawyers moved for summary judgment because the plaintiff’s suit was filed after the two-year statute of limitations for his legal malpractice claim. The plaintiff then pled the discovery rule but the trial court granted Lawyers’ motion to strike the amended petition as untimely. The trial court granted summary judgment in favor of Lawyers. The court of appeals affirmed the summary judgment, holding that when the plaintiff fails to timely plead the discovery rule, the legal injury rule applies in determining when a negligence cause of action accrues and when the statute of limitations begins to run. The plaintiff’s legal injury by the defendants occurred on April 24, 1985, the date the statute of limitations ran in the underlying case.

Issue: Whether the plaintiff’s claims against the defendants begin to toll before all of the appeals for the underlying claim are exhausted.

Ruling: When an attorney allegedly commits litigation malpractice, the court held that the statute of limitations does not begin tolling until all appeals of the underlying claim are exhausted.

Lesson: A plaintiff may wait to file suit for a legal malpractice claim until all appeals for the underlying claim have been exhausted. A plaintiff is able to consider the final outcome of the underlying claim before filing suit for legal practice. If the discovery rule applies, it is necessary to plead it in a timely fashion. Malpractice litigators should be aware of the burdens in asserting limitations defenses and relying on discovery and other tolling rules.

 
Jean Moss Sullivan is a third year student at Texas Tech University Law School and is a J.D. Candidate for May 2010. She received her B.A. in Religion from Southwestern University in 2007.

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

Sanchez v. Hastings, 898 S.W.2d 287 (Tex. 1995).

TX: Underlying personal injury and wrongful death action; conflicts of interest; statute of limitations

Student Contributor: Rudolfo Santos, Jr.*

FACTS:   On June 8, 1984, Carlos Sanchez, husband of Graciela Sanchez, was killed on the job, when a portable crane mounted on his employer’s, Cedar Creek Fabrications, Inc., truck came into contact with electrical wires.
Soon thereafter, Steve Hastings, on behalf of the law firm Allison & Huerta, P.C., (the Firm), contacted Mrs. Sanchez and offered to represent her as well as the Estate of Carlos Sanchez, and their minor child Gina Sanchez, in a wrongful death and survival action stemming from the job accident. Mrs. Sanchez agreed to allow the firm to handle the matter, but unbeknownst to her the firm also represented Reliance Insurance Company, Cedar Creek Fabrications, Inc.’s workers compensation insurance carrier, in its subrogation action against the defendants for reimbursement of the death benefits paid to Carlos Sanchez’s family.
The Firm filed a wrongful death and survival suit naming various parties as defendants, but the suit did not include any action against Cedar Creek Fabrications, Inc. When the case proceeded to trial the court appointed an ad litem to represent Gina Sanchez. The ad litem had filed a claim against Cedar Creek Fabricators, Inc., alleging gross negligence, but by that time Graciela Sanchez was barred from bringing a similar claim due to expiration of the limitations period. The trial court rendered a final judgment against the defendants on August 29, 1990.
Approximately two months after final judgment was entered, Graciela Sanchez contacted the ad litem; it was at that time the ad litem informed Mrs. Sanchez about prospective malpractice claims against the Firm. On August 29, 1990, Graciela Sanchez filed a malpractice claim against the Firm and three of its attorneys individually. The defendants moved for summary judgment on the ground that Sanchez’s claim was barred by statute of limitations. The trial court granted defendants’ summary judgment on the ground that the two-year statute of limitations precluded the suit. The court of appeals affirmed.

ISSUE:  Whether the running of the statute limitations is tolled in a legal malpractice case where the underlying litigation has not concluded?

RULING:  The court held that the limitations period was tolled until the conclusion of the underlying litigation. The court considered its previous decision in Hughes v. Mahaney & Higgins, 821 S.W.2d 154 (Tex. 1991),  where it held :

“when an attorney commits malpractice in prosecution or defense of a claim that results in litigation, the statute of limitations on the malpractice claim against the attorney is tolled until all appeals on the underlying claims are exhausted.” Id. at 157.

The Court determined that Hughes necessarily extended to trial court proceedings. Therefore, limitations, on malpractice claims, are tolled until a final judgment is entered on all underlying claims.

LESSON:  1) Attorneys should avoid fundamental conflicts of interest, or at the very least be candid to clients by disclosing all potential conflicts of interest.    2) In Texas, the statute of limitations does not begin to run until a final judgment has been entered on all claims stemming from the underlying litigation.

*Rodolfo “Rudy” Santos, Jr. is a third year law student at the Texas Tech School of Law, and will be receiving his J.D. in May 2010.  His main area of study has been devoted to trial and appellate practice.  He will be joining the litigation department of Person, Whitworth, Borchers & Morales, LLP in August 2010.

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

Leffler v. Mills, 285 A.D.2d 774 (3 Dept. 2001)

Underlying NY Probate Action

Student Contributor: Marina Kritikos

Facts: Plaintiffs were beneficiaries of a will. They had hired the defendant attorney to probate the will. As part of his duties, the attorney paid state estate taxes due by the beneficiaries, but failed to timely pay the federal taxes due. Although the attorney then secured an extension to pay the federal taxes by January 1, 1995, he failed to actually make the payment until November 6, 1995. As a result, the Internal Revenue Services charged penalties and interest in the amount of $158,853.33 to the estate. Plaintiffs subsequently discharged the attorney, and in December 1998, brought an action for legal malpractice. Both Plaintiffs and the defendant attorney filed motions for summary judgment. The trial court ruled in favor of the Plaintiffs, and the attorney appealed that ruling.

Issue: Did the lower court correctly grant Plaintiffs’ motion for summary judgment in light of New York’s three-year statute of limitation for the filing of legal malpractice actions?

Ruling: The lower court erred in granting Plaintiffs’ motion for summary judgment. There is a three-year statute of limitations for legal malpractice actions which may be tolled if there is “ clear indicia of an ongoing continuous, developing, and dependent relationship between the client and the attorney.” The Supreme Court of New York, Appellate Division, Third Department, found the evidence to be insufficient to establish a continuing relationship as a matter of law, despite the fact that the attorney was listed as “attorney of record” for the estate on an accounting dated January,1996 and federal and state estate income tax returns dated April, 1996.

Lesson: Although the court will toll the three-year statute of limitations for legal malpractice actions, the extension will only be granted where there exists clear, unequivocal evidence of an ongoing attorney-client relationship and continued dependence and reliance on the attorney with regard to the matter that was, purportedly, negligently handled.

• Email This
• Print
• Comments (4)
• Trackbacks
• Share Link