Massachusetts Supreme Judicial Court Reinstates Legal Malpractice Claim of Vessel Owner

The Massachusetts Supreme Judicial Court has reversed a lower court ruling granting summary judgment to a law firm, saying the firm had failed to use all measures to combat an erroneous ruling by a French court. The firm, Dechart, had represented a seafood company, whose fishing boat was severely damaged, while undergoing repairs in Tahiti, which is a French protectorate. The French court had given the company an opportunity to submit additional evidence of its losses incurred, but the law firm failed to make the additional submissions, information which it had in its possession.

The lower court judge in the case had entered summary judgment for the law firm, finding that the error of the French court was a ‘superceding’ cause of the damage suffered by the client. The SJC disagreed, ruling that the French court’s mistake was a concurrent, not a superceding cause, rendering the firm potentially liable for its failure to make the additional submissions.

Said the Court, “[w]here an attorney makes a reasonable and correct argument of law and loses because of judicial error that was not foreseeable, the attorney cannot be found negligent for failing to prevent or mitigate that legal error, but where the judicial error is foreseeable…then an attorney has an obligation to take reasonable and prudent steps to prevent or mitigate that error.”

The French court had ruled that a $1.76 million insurance subrogation claim, assigned to the vessel owner by its insurer, would have resulted in a double recovery to the owner, and was therefore improper, but the Court also indicated that it would entertain evidence of monies expended by the owner and other liabilities of the insurer forgiven, which would demonstrate actual consideration paid for the assignment.

It is this evidence that Dechart failed to produce, which the SJC said was a foreseeable “concurrent cause” of the losses suffered by the insurer, and therefore the owner, as assignee. The Court also indicated that a remand of the case was not necessary, as the evidence before it, made the negligence of the firm clear.

Karabati v. Dechert

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