Published on:

One of the most difficult issues in some malpractice litigation is whether the law suit was timely or not. Generally, the plaintiff has two years from the date of discovery of the problem. Each case is different and there is often argument as to when a plaintiff should have become aware of the facts leading him to suspect legal malpractice. The defense will often argue that the plaintiff should have suspected his injury or investigated the problem before the plaintiff contends that he was aware.

Suburban Real Estate Services, Inc. v. Carlson, 2022 IL 126935, clarifies some of these issues for legal advice that causes litigation. In the Carlson case, in 2010 the plaintiff hired a lawyer to advise him on how to terminate a joint venture with another company. The attorney allegedly advised the plaintiff to terminate the arrangement. In August 2010, the adverse party disagreed and filed a lawsuit for breach of fiduciary duty. In July 2015, after a trial, the court awarded damages in favor of the adverse party.

The key question is when did the claim arise? The defense argued that the statute of limitations began to run when the plaintiff had to hire a new attorney to defend the breach of fiduciary action. So under the defense view, plaintiff discovered his injury in 2010 and should have sued for malpractice by 2012.  Plaintiff argued that he was not aware of the allegedly incorrect legal advice until the adverse judgment was entered in the underlying case in 2015. The Illinois Supreme Court held that the injury accrued upon the entry of the adverse judgment.

Published on:

Here are a few risk management ideas for the New Year.

  1. Make sure all clients sign engagement letters and provide retainers.
  2. Make sure your malpractice insurance is up to date. Every year I defend lawyers who failed to obtain insurance. Let’s make sure that lawyer isn’t you this year.
Published on:

In Estate of Christo v. Law Offices of Thomas Leahy, 2021 IL App (1st) 200575-U, the Appellate Court reversed the entry of judgment in favor of a law firm in a legal malpractice case filed by the Public Guardian. The Leahy Firm had represented Barbara Rose Christo, Peter Christo and Fay Christo in a wrongful death action arising out of the death of their father, Thomas Christo.

The case settled and each plaintiff received approximately $550,000. The complaint alleged that Peter Christo misappropriated the funds belonging to his sister, Barbara, who was disabled. The legal malpractice complaint alleged that the Law Firm was aware that Barbara had significant intellectual disabilities but it failed to seek a guardianship for Barbara or otherwise protect her interest in her share of the settlement funds.

After a bench trial the trial court ruled in favor of the Law Firm on all claims holding that the Law Firm met the duty of care and that Barbara could not prove proximate causation. Barbara appealed on several grounds. The Appellate Court reversed the judgment on the ground that the trial court had misstated the evidence, in particular the testimony of a Doctor who testified that Barbara was disabled.

Published on:

Katz v. Katten Muchin 2021 IL App (1st) 200331, is a malpractice case in which the Illinois Appellate court reversed the dismissal of a legal malpractice case.  Andre Katz filed a petition to be appointed the temporary guardian of his mother on June 9, 2017. He learned that his mother had retained Katten Muchin to revise her estate plan to his detriment. On November 16, 2017, Katz took the deposition of one of the lawyers at Katten Muchin who had represented his mother and who had re-drafted the estate plan to Katz’s detriment (and to the advantage of his brother).

On June 27, 2019, Katz filed the legal malpractice action against Katten Muchin. Katten Muchin argued that the two-year statute of limitations had run because Katz was aware that Katten Muchin had done estate planning work for his mother on June 9, 2017, more than two years before the lawsuit was filed. The trial court dismissed the case on statute of limitations grounds.

Katz appealed. He argued that he was unaware that the lawyers were the cause of his injury until he took the deposition of the Katten Muchin lawyer on November 16, 2017. The Appellate Court reversed the dismissal of the Complaint on the ground that there was an issue of fact as to when Katz discovered his injury.  The opinion carefully discusses the discovery rule and how it is applied.

Published on:

Bielfeldt v. Graves, 2021 IL App (3d) 200118-U, should be a published opinion. In any event, it stands for the proposition that a legal malpractice claim was timely under the federal savings statute. Here a timely legal malpractice claim was filed in federal court. The federal court dismissed that claim for lack of subject matter jurisdiction. Bielfeldt re-filed the claim within one year of the dismissal by the federal court.

¶ 17 Bielfeldt argues that the malpractice claim was timely filed under the savings statute, section 13-217 of the Code (735 ILCS 5/13-217 (West 1994)). Under that provision, if the action is dismissed by a federal district court for lack of jurisdiction then, “whether or not the time limitation for bringing such action expires during the pendency of such action, the plaintiff*** may commence a new action within one year or within the remaining period of limitation, whichever is greater.” Id. This section only applies, though, when a plaintiff has initially filed suit in a timely manner, and the original statute of limitations has not expired before that action was ever filed. Leffler v. Engler, Zoghlin & Mann, Ltd., 157 Ill. App. 3d 718, 723-24 (1987).

¶ 18 Graves does not dispute that the state court complaint was filed within one year of dismissal from the federal court. However, Graves argues that Bielfeldt first asserted allegations of legal malpractice arising from the “Major Event” in the third amended complaint in federal court, which was not filed until August 3, 2016, after the statute of limitations would have expired according to Graves. The pleadings in the court below, however, allege that Bielfeldt did not receive a letter until on or about January 23, 2015, indicating the shares of stock to Graves that allegedly diluted his ownership interest. For purposes of a motion to dismiss, Bielfeldt sufficiently pled a legal malpractice claim against Graves that was filed within two years of when Bielfeldt allegedly knew or reasonably should have known of his injury. Thus, the legal malpractice claim survives as timely filed pursuant to the savings statute and we reverse the dismissal of count VII and remand this matter to the trial court for further proceedings as to count VII.

Published on:

Rojo v. Tunick, 2021 Il App (2d) 200191, is a legal malpractice case filed by a criminal defendant against his former lawyer. Usually these cases are quickly resolved because the plaintiff cannot plead actual innocence. Since Rojo was convicted he could not plead actual innocence. However, Rojo alleged a second count of legal malpractice that he was overcharged by the lawyer. He claimed that hte lawyer withdrew before trial and that he was overcharged. The Appellate Court held that the actual innocence rule does not bar such claims and reversed the judgment dismissing the complaint.

The Appellate Court followed a 1995 Seventh Circuit decision, Winniczek v. Nagelberg, 394 F.3d 505 (7th Cir. 2005) that held that a criminal defendant need not allege or prove actual innocence to argue that he was overcharged.

¶ 41 The present case presents the opportunity Winniczek envisioned, and we take the position that the Seventh Circuit anticipated we would. Plaintiff’s legal-malpractice action is based on two distinct theories that parallel the two counts in Winniczek. Plaintiff alleged that (1) defendant’s representation of plaintiff was deficient and that this led to plaintiff’s conviction and (2) defendant owed plaintiff compensation for withdrawing from the case prematurely, refusing to refund fees paid, and forcing plaintiff to pay for new counsel. Consistent with Winniczek, we hold that the absence of an actual-innocence allegation barred the legal-malpractice claim asserting that defendant’s deficient performance led to plaintiff’s conviction. However, the absence of an actual-innocence allegation did not bar the legal-malpractice claim seeking reimbursement of fees. That claim, unlike the deficient-performance claim, did not blame defendant for plaintiff’s conviction.

Published on:

In every legal malpractice case, the plaintiff is required to hire an expert witness, a lawyer, to testify that the defendant breached the standard of care. This is also required in medical malpractice cases.  Experts cost money that will inevitably reduce any recovery. So when you think of filing a legal malpractice case, you need to be able to plausibly prove a significant amount of damages before the legal malpractice case becomes worth pursuing. Small cases, for $10,000 or $15,000, don’t work economically. Indeed, most clients would be worse off if such a case were actually filed because the legal fees and expert fees would exceed the recovery.

Ed Clinton, Jr.

Published on:

In a recent California legal malpractice case, Andrade v. Purviance, No. A161331, California Court of Appeal, 1st Appellate District 2021, the court upheld the dismissal of a legal malpractice case against a criminal defense attorney where the plaintiff could not show that she had been exonerated.  In recent years, some scholars have criticized the rule, but it remains the majority rule in the United States. The court explained:

The elements of a legal malpractice action are “(1) the duty of the attorney to use such skill, prudence, and diligence as members of his or her profession commonly possess and exercise; (2) a breach of that duty; (3) a proximate causal connection between the breach and the resulting injury; and (4) actual loss or damage resulting from the attorney’s negligence.” (Coscia v. McKenna & Cuneo (2001) 25 Cal.4th 1194, 1199 (Coscia).)

However, to succeed on a claim for legal malpractice arising from a criminal proceeding, a plaintiff also must prove that he or she is actually innocent. (Coscia, supra, 25 Cal.4th at pp. 1199-1200.) “In Coscia, the Supreme Court addressed . . . `whether a former criminal defendant must obtain exoneration by postconviction relief as a prerequisite to obtaining relief for legal malpractice.'” (Wilkinson v. Zelen(2008) 167 Cal.App.4th 37, 46.) The Coscia court concluded, “a plaintiff must obtain postconviction relief in the form of a final disposition of the underlying criminal case—for example, by acquittal after retrial, reversal on appeal with directions to dismiss the charges, reversal followed by the People’s refusal to continue the prosecution, or a grant of habeas corpus relief—as a prerequisite to proving actual innocence in a malpractice action against former criminal defense counsel.” (Coscia, supra, 25 Cal.4th at p. 1205, fn. omitted.) This requirement is grounded in the principles that criminal defendants are provided constitutional and statutory guarantees against ineffective assistance of counsel, and that guilty defendants should not be able to profit from their wrongdoing or shift responsibility for the consequences of their illegal behavior to their criminal defense counsel. ( pp. 1203-1204; Wiley v. County of San Diego (1998) 19 Cal.4th 532, 537-538, 542-543.) Moreover, the actual innocence requirement avoids the risk of inconsistent resolutions in criminal and civil proceedings, serves judicial economy by precluding malpractice actions where a criminal defendant has been denied relief on the basis of ineffective assistance of counsel, and encourages attorneys to represent criminal defendants by reducing meritless malpractice claims. (Coscia, at p. 1204.)

Published on:

The case is ALPS Prop. & Cas. v. Keller, Reynolds 482 P.3d 638 (Montana, 2021). After purchasing the malpractice insurance policy, the firm sought to tender a malpractice claim to the insurer. Unfortunately for the lawyers, the insurer denied coverage because the law firm knew the basis of the malpractice action before it purchased the insurance policy. The Montana Supreme Court held that there was no coverage under the policy because the law firm (through one of its partners) was aware of the potential claim before purchasing insurance.

The reasoning:

¶16 Here, the Policy contains two provisions—one coverage provision, and one exclusionary provision—that enforce this basic concept. First, in defining the scope of the Policy’s coverage, provision 1.1.2 states that ALPS “agrees to pay on behalf of the Insured all sums (in excess of the Deductible amount) that the Insured becomes legally obligated to pay as Damages, arising from or in connection with a Claim first made against the Insured and first reported to [ALPS] during the policy period, provided that at the Effective Date of [the] Policy, no Insured knew or reasonably should have known or foreseen that the act, error, omission or Personal Injury might be the basis of a Claim….” (Emphasis added.)

Contact Information