Monday, March 18, 2013

Malpractice Claims Not Per Se Unassignable

The Georgia Supreme Court has agreed with the Court of Appeals and held that "legal malpractice claims are not per se unassignable."

The attorney closed a mortgage-refinance in which the lender paid off earlier mortgages on the secured property. The title insurance company issued title insurance, the attorney had the funds wired into a specified escrow account but the funds were withdrawn by a non-lawyer.

The title insurer paid the earlier mortgages and then sued the attorney's firm and others.

The court held that the malpractice claim for failure to pay the outstanding loans

...alleges a purely pecuniary injury and does not allege a "personal tort" making it assignable under [Georgia law], and the act of assignment raises neither an issue of professional responsibility nor an issue of illegality. Since we are not presented with facts that call into question the regulation of the conduct of attorneys or the control and supervision of the practice of law, we decline to positb and answer hypothetical questions.

Affirmed. (Mike Frisch)

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