Articles Posted in National Legal Malpractice Cases

The United States Court of Appeals for the Seventh Circuit has affirmed a summary judgment for an attorney in a legal malpractice action. In Rosenbaum v. White, a client hired an attorney to form a new business venture, which would rehabilitate and then resell real estate.

The client recruited a group of investors, who purchased membership interests in an LLC, which the client intended to form. He hired an attorney to prepare LLC documents for the investment offering. The attorney also spoke at a recruiting seminar about the implications of investing in an LLC and relevant securities laws.

The venture failed, and the investors brought an action against the attorney claiming he was responsible for their losses. They argued that an attorney-client relationship existed and it continued beyond the drafting of the documents. The investors claim was largely based on statements made by the client at the seminar about the attorney “working” for him and for the investors. The attorney moved for summary judgment in the case and the trial court granted his motion. The investors appealed.

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A North Carolina appellate court has affirmed a summary judgment granted in favor of an attorney in a legal malpractice action. In Tarrant v. Hudson, a client suffered injuries in a motor vehicle accident. The attorney who he hired to make a claim against the other driver in the accident, failed to file a complaint before the statute of limitations had expired.

The client then sued the attorney for malpractice. The attorney moved to dismiss the complaint, claiming there were no damages because the client had never filed an action. The court denied the motion, but ordered the client to proceed to file a complaint in the underlying action, which the client did. When the driver of the other vehicle failed to answer the complaint, the court entered a default judgment.

In North Carolina, a plaintiff in a legal malpractice action must demonstrate that he/she would have prevailed in the underlying case, but for the attorney’s negligence. The client moved for summary judgment in the malpractice action, arguing that the attorney was collaterally estopped from maintaining that causation was lacking based on the default judgment in the client’s favor. The trial court denied the motion, and entered summary judgment for the attorney. The client appealed.

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A Michigan appellate court has affirmed summary judgment in favor of an attorney in a legal malpractice case. In Hull v. Steinberg.doc, a husband and wife suffered serious personal injuries when their vehicle was stuck by tractor trailer. The couple retained an attorney to bring an action against the truck driver.

The husband and wife were treated for their injuries, including undergoing minor surgeries. They were both able to return to work within several weeks of the accident. The attorney filed a complaint approximately nine months after the accident. The truck driver moved for summary judgment. Under Michigan law, in a personal injury action plaintiffs must show that their injuries affect their “general ability to lead normal lives”. The trial court found that the couple had failed to meet this standard and therefore granted the truck driver’s motion.

Over the next two years, the couple’s injuries became worse. Their physician advised them that their injuries would likely be lifelong, requiring ongoing care. The couple notified their attorney, who then filed a motion for relief from judgment. However, the court denied the motion, ruling that the motion was not timely, as it had not been filed within one year of the original dismissal.

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A California appellate court has affirmed a ruling sustaining a demurrer of a second amended complaint alleging legal malpractice. In Cakarcan v. Law Offices of Steven Stoler & Assocs., LLP, a client retained an attorney to represent her in her divorce and child custody proceedings. Prior to the conclusion of those cases, the attorney successfully withdrew his representation. The client continued to pursue both actions representing herself pro se. Judgment was entered against her in both cases.

Over two years later, the client filed a legal malpractice action against the attorney for negligently representing her in those actions. After twice amending her complaint, the trial court sustained the attorney’s demurrer without leave to further amend, on the grounds that the complaint was barred by the one year statute of limitations. The client appealed.

Under California law, a legal malpractice claim must be filed within one year of the discovery of the alleged negligent conduct. The period may be tolled for up to four years if the plaintiff is under a legal or physical disability, which prevents the plaintiff from commencing the action. The client contended that she was under such a disability because she was undergoing cancer treatment.

However, the appellate court held that the client’s treatment did not rise to the level of disability required, such as imprisonment or an illness that left a person bedridden, because it did not actually prevent her from brining the action. The court relied on the fact that the client continued to pursue her custody and divorce proceedings while she was undergoing treatment. Therefore, the statute of limitations was not tolled and the claim was properly dismissed.

Decision: Cakarcan v. Law Offices of Steven Stoler & Assocs., LLP

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A Michigan appellate court has affirmed a summary judgment in favor of an attorney in a legal malpractice action. In Saffron v. Elhart, a client retained an attorney to represent him in his divorce proceedings. During the trial, the client alleged that his former wife had gambled away almost $300,000 of marital funds. However, he was unable to prove the exact amount of money that she had lost. Nevertheless, the court entered a judgment reflecting a credit to the husband for a portion of the amount that he claimed she had lost.

Also, during the marriage, the couple entered into an antenuptial agreement, which protected real estate, which the wife had inherited. The client sought to invalidate the agreement due to the wife’s infidelity. However, the court enforced the agreement and awarded the property exclusively to the wife.

The client then brought a legal malpractice suit against his attorney, alleging that the attorney failed to conduct adequate discovery regarding the gambling money lost, and failed to properly challenge the validity of the antenuptial agreement, which prevented him from obtaining a more favorable settlement. The attorney successfully moved for summary judgment, and the client appealed.

The appellate court affirmed the judgment. The court relied on the absence of any further proof of monies lost through his wife’s gambling With respect to the antenuptial agreement, the Court concluded that the client had failed to establish that his wife’s inherited real estate was marital property. Therefore, there was no evidence that the attorney’s conduct had proximately caused the client any harm.

Decision: Saffron v. Elhart

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The U.S. District Court for the District of Arizona has denied an attorney’s motion to dismiss a legal malpractice action. In Kaufman v. Jesser, a client retained an attorney to pursue an action for medical malpractice against a veterinarian who treated the client’s exotic bird. The veterinarian had performed surgery on the bird, but it never fully recovered and died a month later. The client sought damages for his emotional distress and loss of companionship.

At trial, jury found that the veterinarian was 30% negligent, but awarded the client zero damages. The client appealed. The appellate court affirmed the ruling, finding that under Arizona law, an owner is not entitled to recover emotional damages for the loss of a pet. The client then filed a legal malpractice action against the attorney in state court. The client alleged that the attorney’s conduct amounted to malpractice, including his failure to (a) submit a pretrial witness and exhibit list, which resulted in the exclusion of key witnesses and exhibits, (b) submit jury instructions, and (c) require the veterinarian to answer interrogatories after the court had granted the client’s motion to compel responses.

The attorney successfully removed the case into federal district court on diversity grounds, and then brought a motion to dismiss for the client’s failure to state a claim, and failure to provide a preliminary expert witness opinion, as required by Arizona law. The client argued that an expert witness was not necessary because the alleged negligence was so obvious that a lay person could make a determination.

The federal court denied the motion, finding that the client’s complaint properly pleaded all of the elements of a legal malpractice claim. However, the court found that a preliminary expert witness was necessary to establish the requisite standard of care for a reasonable attorney. The court permitted the client to submit an affidavit with an expert opinion within thirty days.

Decision: Kaufman v. Jesser

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A California appellate court has affirmed a summary judgment in favor of an attorney in a legal malpractice action. In Tidgewell v. David E. Gentry, APC, a client hired an attorney to represent her in worker’s compensation claim and age discrimination suit against her employer. The attorney negotiated a settlement with the employer on the worker’s compensation claim and the client executed a standard form release agreement. At the time of signing, the attorney assured the client that the agreement would have no impact on the separate age discrimination claim.

However, when the client filed her discrimination claim, the employer asserted the settlement agreement as an affirmative defense to her claims. The client agreed to settle her discrimination claim at what she believed was a significant discount because her case was weakened by the prior agreement. She then filed a legal malpractice case against the attorney.

The attorney successfully moved for summary judgment. The trial court found that the release agreement unambiguously settled the worker’s compensation claim only, and did not waive or affect her discrimination claim. The client appealed.

Under California law, all worker’s compensation claims must be executed on a standardized form, which contains language to the effect that the settlement does not apply to actions outside of the worker’s compensation system. The parties did include an addendum to the standard form, but the language was unambiguously limited to the worker’s compensation claim and did not impact the discrimination claim. Therefore, the appellate court affirmed the ruling.

Decision: Tidgewell v. David E. Gentry, APC

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A Washington appellate court has affirmed a judgment in favor of a client in a legal malpractice action. In Puget Sound Electrical Workers Health Trust and Vacation Plan v. McKenzie Rothwell Barlow & Korpi, P.S.doc, an electrical worker’s union trust had a collective bargaining agreement with electrical contractors, which required the contractors to pay a portion of the wages of its union members into the trust. The trust retained an attorney to do collections for the trust’s funds.

After a number of years, the trust terminated the attorney, who then informed the trustees that several years earlier, he had made errors handling delinquent collection accounts. The trust then sued the attorney for legal malpractice. After a jury waived trial, the court found in favor of the trust and entered judgment against the attorney for nearly $1.5 million. The attorney appealed.

On appeal, the attorney argued that the trial court made an improper ruling when it found that a reasonably prudent attorney would have collected 85% of the total delinquent accounts, and therefore its calculation of damages was improper. The appellate court affirmed, finding that the 85% collection rate was sufficiently supported by expert witness testimony, and therefore the calculation of damages was reasonable.

Decision: Puget Sound Electrical Workers Health Trust and Vacation Plan v. McKenzie Rothwell Barlow & Korpi, P.S.

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A New Jersey appellate court has dismissed a legal malpractice case on the basis that there was no basis for personal jurisdiction over the defendant attorney. In Finley v. Zimmerman, a husband and wife sued their former attorney, a Florida lawyer, for negligence while representing them in the purchase of Florida real property. The clients had purchased the property jointly with their friend as an investment. The couple paid one half of the purchase price in exchange for a 50% interest in the property. The friend paid the other half, but financed a majority of his share.

The attorney represented all three individuals in the purchase and allegedly assured the husband and wife that their interests would be protected. However, the recorded deed named only the friend as the owner. The husband and wife claimed to have made repeated requests for evidence that their interests were protected, but the attorney never furnished any documentation. The friend subsequently gave a second mortgage on the property without giving notice to the couple. The friend eventually defaulted on the loan, resulting in the total loss of the property.

Upon learning of the forfeiture, the couple filed a malpractice claim against the attorney in New Jersey. The attorney moved to dismiss the complaint for lack of personal jurisdiction, but the motion was denied. The attorney then appealed.

The appellate court reversed the trial court, reasoning that the attorney had insufficient contacts with the state of New Jersey necessary to exercise jurisdiction over him. The court relied on the fact that (1) the attorney was only admitted to practice in Florida, (2) the property was located in Florida, (3) the attorney had not solicited the clients in New Jersey, and (4) the attorney’s only connection with New Jersey was his communications with the couple at their residence. This sole connection was insufficient in order for New Jersey courts to exercise jurisdiction over the attorney.

Decision: Finley v. Zimmerman

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A Missouri appellate court has ruled that a legal malpractice claim survived the death of a client. In Roedder v. Callis, a client caused a serious motor vehicle accident, which left the other operator paralyzed. The victim sued the client for negligence and the client hired an attorney to defend him in the case. Following a trial, the court entered judgment against the client in the amount of almost $25 million.

The client then brought a legal malpractice suit against the attorney. Shortly after filing his complaint, the client died. His wife, acting as personal representative of his estate, successfully moved to substitute herself as plaintiff. The attorney then moved to dismiss the claim on the grounds that the claim abated with the client’s death. The trial court granted the motion and the wife appealed.

The appellate court reversed the dismissal and remanded the case. The court found that under Missouri law, causes of action arising from either personal injuries or damage to property, survive the injured party’s death and may be brought by a successor. The court determined that a legal malpractice claim could be construed as both a personal injury claim, because of the nature of the attorney-client relationship, and also a property damage claim, because of the failure to protect the client’s financial interest. The court thus found that the client’s claim survived his death and could be pursued by his wife.

Decision: Roedder v. Callis

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