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A legal malpractice case requires careful analysis. Even if the lawyer was negligent in some way, did the negligence make any difference in the ultimate outcome? To evaluate a legal malpractice case, you must evaluate the underlying case as well.

Rodi v. Horstman, 2015 IL App (1st) 142787 is such a case. Rodi hired Horstman to handle an appeal of an unfavorable decision. It is undisputed that Horstman filed the notice of appeal one day late and the Appellate Court held that it had no jurisdiction. Rodi then sued Horstman for legal malpractice, but the trial court granted summary judgment for Horstman and the Appellate Court affirmed. The reason is that even if Horstman had timely filed the notice of appeal the appeal was a loser.

The Underlying Case:

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In most states, a former client of a criminal defense lawyer cannot sue for legal malpractice unless he can establish “actual innocence.” The Actual Innocence rule bars almost all legal malpractice claims against criminal defense lawyers. The purported basis for the rule is that the guilty person should not profit from his crimes. Scholars have criticized the rule as poorly reasoned and lacking in justification. One criticism of the rule is that it unfairly differentiates between civil lawyers and criminal lawyers. A civil litigator who breaches a duty to a client, causing the client to lose an underlying case, is not immune from suit. The client suing the civil litigator is not required to prove actual innocence or anything like it.

This week the Supreme Court of Kansas abolished the Actual Innocence rule. Mashaney v. Board of Indigents’ Defense Services. In Mashaney, the plaintiff claimed that he was wrongly convicted of child sexual assault due to the ineffective assistance of his court-appointed lawyers. The opinion does not furnish many details but it appears that the case against Mashaney arose when the mother of Mashaney’s five year old daughter made allegations that Mashaney had sexually abused his daughter.

Mashaney was convicted in 2004 and sentenced to 442 months of imprisonment. He steadfastly maintained his innocence. In 2011, Mashaney entered into an Alford plea under which he pleaded guilty to two counts of attempted aggravated battery and one count of aggravated endangering a child. The State dropped the remaining charges and Mashaney was sentenced to 72 months imprisonment. Because he had already served more than 72 months, he was entitled to be released from prison.

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Source: Sheth v. Premier Bank, Dist. Court, WD Wisconsin 2015 – Google Scholar

The plaintiff in this case, Kamlesh Sheth, lost a state court foreclosure case. Sheth then sued a law firm for legal malpractice and the bank that obtained the judgment against him for fraud and other torts.

Sheth claimed that the defendant bank had agreed not to pursue a deficiency judgment against Sheth. Sheth cited an agreement between himself and the bank and drafted by the defendant law firm under which the Bank waived the right to pursue the deficiency if Sheth obtained a buyer for the property and the sales price was $1,100,000 and the buyer agreed to pay off the mortgage note. Sheth claimed that he met his obligations under the agreement and that the Bank had no right to seek a deficiency judgment.

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Source: LAMET v. Levin, Ill: Appellate Court, 1st Dist., 3rd Div. 2015 – Google Scholar

This is a legal malpractice case that the Illinois court held was barred by the six-year statute of repose and also by the two-year statute of limitations. Lamet hired Levin in 1994 to represent him in a dispute with his landlord. Lamet’s landlord claimed that Lamet owed $34,000. Levin fought the litigation for 17 years. (Levin claimed that he was being charged for more square feet than he actually rented). Ultimately, in 2011, Levin recommended that the litigation be settled for the sum of $150,000.

Lamet then sued Levin for legal malpractice “essentially asserting that Levin should have advised him in 1994 to accede to his landlord’s demands and forgo defense of the lawsuit.”

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William Carlson and Willis Capital, LLC v. David J. Fish and the Fish Law Firm, P.C., Shawn M. Collins and The Collins Law Firm, P.C., 2015 IL App (1st) 140526.

This is a decision of the Illinois Appellate Court affirming the dismissal of a legal malpractice lawsuit on the ground that the two-year statute of limitations had expired before the lawsuit was filed.

The lawsuit arose out of a business dispute between William Carlson and his business partners in an entity known as Belvedere Trading, LLC. In 2006, Carlson had a “falling out” with his partners. In February 2008, Carlson agreed to mediate the dispute with his partners. He retained the defendant lawyers to represent him. On February 13, 2008, the parties held a mediation in which Carlson agreed to sell his interest in Belvedere for $17.5 million. The settlement agreement was signed on March 6, 2008. It is noteworthy that Carlson did not obtain an independent appraisal of the value of his interest in Belvedere before the mediation.

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The case is Construction Systems, Inc. v. FagelHaber, LLC, 2015 IL App (1st) 141700. The plaintiff sued FagelHaber for failing to perfect a mechanic’s lien resulting in the subordination of that lien to a mortgagee’s lien. The legal malpractice claim is straightforward. The more interesting question was whether the law firm could defend on the ground that it settled a fee claim against the client before the legal malpractice claim was filed.

In 2003, Construction Systems retained FagelHaber to serve mechanics lien relating to a real estate development. FagelHaber allegedly failed to perfect the lien because it failed to serve the lien on the Cosmopolitan Bank, which held a mortgage on the property. In January 2004, FagelHaber filed an appearance for Construction Systems in a lawsuit dealing with the mechanics’ liens. (The mechanics’ lien litigation).

In August 2004, FagelHaber withdrew as counsel for Construction Systems in the underlying mechanic’s lien litigation. In November 2004, FagelHaber and Construction Systems entered into a settlement agreement under which Construction Systems … “does hereby fully remise, release and forever discharge FagelHaber..of and from any and all claims, demands, actions, causes of action, suits, … existing at the date hereof or hereafter arising, both known and unknown, forseeable and unforseeable, …arising from or in connection with any matter,… including, without limitation, and Claims in connection with the legal services provided by FagelHaber to [Construction Systems] or the Indebtedness.”

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What is an attorney’s possessory lien? It is a lien that an attorney can use to block the client from access to the file. The attorney, however, cannot enforce the lien in court. In a recent unpublished decision the Illinois Appellate Court held that a law firm can assert a possessory lien over a computer database held by a document management firm. The case is captioned Cronin & Company, Ltd. v. Richie Capital Management, LLC., 2014 IL App (1st) 131892-U. Cronin is a law firm that represented Richie Capital (and other parties) in litigation, in which Richie Capital was attempting to recover investment losses incurred when it invested in a Ponzi scheme.

In 2012, Richie authorized Cronin to retain a third-party vendor, Flex Discovery, LLC (d/b/a Landmark Legal Solutions). Landmark was retained to provide a hosting program “that would enable attorneys to access electronic databases containing documents produced in connection with the subject litigation.” ¶ 4.

In January or February 2013, the attorney-client relationship broke down and was terminated. There was a dispute over legal fees between Cronin and Richie Capital. Cronin asked Landmark to “‘hibernate’ the database it was hosting (take it off-line), so it could not be accessed. Cronin claimed it was asserting a retaining lien over its former client’s litigation file, which it argued included the database.”  ¶ 5.

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