Articles Posted in Legal Malpractice

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This issue comes up fairly frequently and almost all of the courts which have considered it have answered it the exact same way. An owner of a unit of a condominium does not have standing to sue the attorney for the condominium association.

The lawyer for the association is responsible to the association’s board of directors, not the unit owners. Allowing random unit owners to sue the lawyer for the association would place the lawyer in a situation where he would have to serve numerous “clients” all of whom have conflicting interests.

Source: GUEHL v. CARILLON HOUSE ASSN., INC., 2017 Ohio 5491 – Ohio: Court of Appeals, 2nd Appellate Dist. 2017 – Google Scholar

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This case is instructive for plaintiff lawyers because it is a reminder that, if the client has filed for bankruptcy, the claim for legal malpractice may belong to the bankruptcy estate. Because the alleged negligence occurred before the bankruptcy petition was filed, the claim belonged to the bankruptcy estate.

Source: LABGOLD v. REGENHARDT, Dist. Court, ED Virginia 2017 – Google Scholar

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The underlying case was routine and it arose out of an automobile accident. The defendant lawyers filed suit timely as to most of the defendants, but they failed to file a timely case as to one defendant. The underlying case settled for $10,000.

The lawyers won a summary judgment motion in the trial court, but summary judgment was reversed. The plaintiff had submitted sufficient evidence of a breach of duty (missing the statute of limitations) that caused damage to the plaintiff.

Source: ATIENCIA v. PINCZEWSKI, 2017 NY Slip Op 1839 – NY: Appellate Div., 2nd Dept. 2017 – Google Scholar

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This unpublished opinion resolves an appeal in a legal malpractice case. The plaintiff sued his lawyer despite the fact that the lawyer settled the underlying case (a medical malpractice case) for $1.5 million.

The Defendant attorney moved to dismiss the case on the ground that the plaintiff was judicially estopped from proceeding because he consented to the settlement of the underlying case. The alleged malpractice was the lawyer’s alleged coercion of an expert witness (a medical doctor) into providing an opinion on surgical issues (and not informed consent). The trial court dismissed the case on estoppel grounds reasoning that because plaintiff had approved the settlement, he could not sue for legal malpractice.

The Appellate Court reversed. It held that it was premature to dismiss the case without conducting discovery and without holding a hearing. The key part of the opinion is quoted below:

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This opinion arises in an unusual procedural setting – plaintiff sought summary judgment on liability. Plaintiff claimed that an estate planning attorney erred in drafting a Will. The documents are quoted here:

On August 19, 2006, Elizabeth executed a revised Last Will and Testament presented to her by Defendants. (Id. at ¶¶ 14-16.) For the purposes of this motion, there are three relevant sections to the Last Will and Testament. Section One reads, in pertinent part:

I give, devise and bequeath all of my property of whatever nature, both real and personal, personal effects, household goods, automobiles, and all other items of goods and chattels to my children who survive me in equal shares of substantially equal value, per stirpes and not per capita.

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It is unfortunate that this case was not published, but it is still worth considering. The plaintiffs sued their lawyer who had drafted a Stock Purchase Agreement under which they sold their stock in a privately held company. When the company was sold, there was litigation pending. The parties negotiated an indemnification provision relating to the litigation. The court describes the facts in this brief summary:

In July 2011, respondent-attorney Joseph A. Turman prepared a stock purchase agreement for the sale of appellants James and Elizabeth Leach’s company, IDA of Moorhead Corporation, to SNAPS Holding Company. At the time of the sale, the Leaches were defending a wrongful-termination lawsuit brought by a former employee, Reed Danuser. The purchase agreement provided that SNAPS was aware of the litigation, and, subject to the indemnity provision in the purchase agreement, agreed to indemnify and pay the expenses and judgment associated with the lawsuit. The indemnification provision in the purchase agreement stated: “[SNAPS] shall hold and indemnify [the Leaches] harmless from the claims of Reed Danuser up to the sum of $100,000.00. In the event the amount necessary to resolve the issues with Reed Danuser exceed[s] $100,000.00 [the Leaches] shall be responsible for that portion.”

Unfortunately for the plaintiffs, the litigation resulted in a judgment exceeding $800,000. They then sued their attorney. The court dismissed the complaint holding that the plaintiffs clearly understood, and admitted they understood, that they were liable for any amount in excess of $100,000. Thus, they could not allege damages and had no lawsuit. Case dismissed. The dismissal was then affirmed by the Court of Appeals.

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The plaintiff filed a malpractice claim against her divorce lawyers. However, her claim did not succeed because she did not provide expert testimony. That testimony, from a family law lawyer, would be necessary to show negligence.

This is one of those truths that we cannot repeat enough times – an expert is needed to show how the lawyer’s performance fell short of the standard of care.

Source: Nolan v. Ernst, 2017 Ohio 1011 – Ohio: Court of Appeals, 12th Appellate Dist. 2017 – Google Scholar

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Lawyers have rights to hold the client’s file or other property as security for payment. Here the lawyer held on to a former divorce client’s file indefinitely. The client eventually sued the lawyer for legal malpractice – under the theory that the lawyer had no right to hold the file. Had the case been decided on that issue, it would have been an important case. However, the court dismissed the case on statute of limitations grounds, based on the three-year Arkansas statute of limitations.

Source: Haynes v. Wagoner, Dist. Court, ED Arkansas 2017 – Google Scholar

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Goldstein was retained as a mediator by Barrett and his then wife. After meeting with the couple, Goldstein drafted a post-nuptial agreement that Barrett and his wife later signed. (A post-nuptial agreement is one that a married couple enters into while a prenuptial agreement is entered into before the marriage). When wife filed for divorce, Barrett sued Goldstein alleging legal malpractice.

Goldstein’s defense was that there was no attorney-client relationship between her and Barrett because Barrett and his then-wife were each represented by counsel. Therefore the act of drafting a post-nuptial agreement did not give rise to a lawyer-client relationship. The court agreed with Goldstein and dismissed the legal malpractice claim. The court explained why it found that there was no attorney-client relationship between Goldstein and Barrett:

Here, plaintiff’s complaint attempts to characterize Goldstein’s role as an attorney-client relationship with plaintiff, but plaintiff failed to allege any facts to substantiate this claim.

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This case is interesting because it dismisses a legal malpractice claim because the expert did not reveal how the negligence of the attorney caused the injury of the plaintiff. The opinion does not shed as much light on the facts of the case as I would like it to. However, the opinion does explain that although plaintiff had an expert and the expert prepared a report, the expert did not sufficiently explain proximate causation. Proximate causation is a difficult concept for nonlawyers to understand. Indeed, sometimes lawyers do not understand it.

In sum, the expert report said the lawyer was negligent but it failed to explain why the negligence caused the bad result that the plaintiff received. The opinion, though it is based on Minnesota law, is consistent with the modern trend in the cases which requires expert reports to be more complete.

Edward X. Clinton, Jr.

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