Sunday, March 18, 2018

Exoneration Not Required To Sue Defense Counsel

The Iowa Supreme Court has held that proof of exoneration is not necessarily required for a convicted defendant to sue for legal malpractice

This appeal presents the narrow question of whether the relief required rule (also called the exoneration rule) applies to a convicted criminal suing one of his defense attorneys for legal malpractice over an alleged missed opportunity to shorten his period of supervised probation. This rule ordinarily requires proof the client had been exonerated from the underlying conviction. The defendant attorney was retained after the malpractice plaintiff was convicted and sentenced on three counts of welfare fraud and ordered to pay restitution. The attorney successfully obtained postconviction relief vacating two convictions and over $80,000 in restitution and successfully opposed the state’s effort to have his client civilly committed as a sexually violent predator. Meanwhile, the offender, represented by separate counsel, was incarcerated for a probation violation. The district court later determined sua sponte that his term of supervised probation should have ended earlier, which would have avoided nearly a year in prison. The offender then sued one of his lawyers for malpractice.

The defendant attorney moved for summary judgment on four grounds. The district court reached only one ground and granted summary judgment based on the relief-required rule. The court of appeals reversed the summary judgment and held the client may sue over the alleged sentencing error without proving his exoneration from the conviction, so long as he obtained relief from the sentencing error. That is the position taken by the Restatement (Third) of the Law Governing Lawyers. We hold the malpractice plaintiff in this situation must prove relief from the sentencing error allegedly caused by the malpractice, not the underlying conviction. We express no opinion on the alternative grounds for summary judgment, including the scope of this defendant–attorney’s duty, if any, to monitor the duration of supervised probation. Those issues were not briefed or argued on appeal and may be decided by the district court on remand.

The court considered the approach of other jurisdictions

These cases reflect the Restatement (Third) position we adopt today. Because Kraklio does not allege Simmons negligently caused his conviction, Kraklio need not prove relief from that conviction. But the relief-required rule still applies to the alleged sentencing error. That is, Kraklio must prove he obtained relief from his period of supervised probation that he claims Simmons should have ended sooner. See Restatement (Third) of the Law Governing Lawyers § 53, at 389 (“A lawyer is liable . . . only if the lawyer’s breach of a duty of care or breach of fiduciary duty was a legal cause of injury, as determined under generally applicable principles of causation and damages.”); id. reporter’s note cmt. d, at 397–98 (collecting cases holding collateral relief from the conviction is not required when the malpractice plaintiff does not challenge the conviction); see also Johnson, 136 P.3d at 80 (“An unlawful restraint of liberty can constitute harm . . . .”); Powell v. Associated Counsel for the Accused, 129 P.3d 831, 833 (Wash. Ct. App. 2006) (“His unlawful restraint beyond th[e maximum] period [allowed by law] was not  a consequence of his own actions.”).

The district court hearing Kraklio’s revocation challenge ruled that his probation actually had ended while he was incarcerated for the probation violation. We conclude this ruling constituted sufficient relief from the alleged sentencing error to avoid summary judgment under the relief-required rule.

Note the significant  improvements  in access to case information on the Iowa Supreme Court web page. (Mike Frisch)

March 18, 2018 in Clients | Permalink | Comments (0)

Tuesday, March 6, 2018

Attorneys Retained By Insurer Disqualified

The Washington State Court of Appeals Division One holds

An insurance defense lawyer who files a notice of appearance on behalf of an estate may not, after withdrawing from representation of the estate, later act on behalf of another client to remove the personal representative of the estate. The personal representative is a former client, and the lawyer must comply with Rule of Professional Conduct (RPC) 1.9, either by withdrawing from representation of the other client or obtaining consent from the estate's personal representative. A lawyer who does not comply is properly disqualified for having a conflict of interest.

The case has a complex cast of characters arising from an accident where both drivers were killed and the wife of one was severely injured. The estate of Harris sued the estate of Taylor Griffith (the 16 year old at fault driver), his parents and their insurer.

Moore is an attorney who was appointed personal representative of the estate of Griffith over the parents objection

The court commissioner ruled that given the potential for conflict between the Griffith parents and their son's estate, it was more untenable to appoint one of the parents than to appoint Moore. The commissioner expressed confidence that Moore would recognize his obligation as a fiduciary to be independent and impartial. The commissioner appointed Moore as personal representative by order dated December 8, 2015. The order specifically authorized Moore "to participate in litigation and to settle or assign claims" on behalf of Taylor's estate.


Travelers appointed attorneys Jacquelyn Beatty and Michael King to serve as additional defense counsel. Beatty filed a notice in the wrongful death action associating herself with Jaeger on behalf of the Griffith parents and Taylor's estate. King filed a notice associating with Jaeger as counsel "for defendants."

The parents were dismissed as defendants and the issues narrowed to only damages. The damages issue went to arbitration.


Represented by King, the Griffith parents filed a petition under the Trust and Estate Dispute Resolution Act (TEDRA), chapter 11.96A ROW, to remove and replace Moore as personal representative. The court consolidated this  petition with the pending motion to revise the commissioner's order appointing Moore. Both were set for consideration on April 29, 2016. By motions filed on March 31, 2016, the Harrises alleged that under RPC 1.9, Beatty and King could not continue to represent the Griffith parents. Beatty and King responded that the rule did not apply because Moore was not their former client.

Au contraire.

The court on standing

A court's formal finding of a lawyer's rule violation carries with it sufficient potential for adverse consequences to the lawyer to make the ruling appealable by the lawyer. United States v. Talao,222 F.3d 1133, 1138 (9th Cir. 2000). Accordingly, we conclude Beatty and King have standing to appeal the disqualification order. Whether the Griffith parents also have standing need not be decided.

And on the merits

An advisory opinion issued by the Washington State Bar Association addresses the precise situation Beatty and King found themselves in—a potential violation of RPC 1.9 by a lawyer retained by an insurance company:

The Committee reviewed your inquiry wherein you had been retained by an insurer to represent a city and a police officer employed by the city. You filed a Notice of Appearance on behalf of each of those clients. Subsequently, you learned that there was a conflict of interest between the two clients. You ask whether you can continue to represent the city after proper withdrawal from representing the police officer. The Committee was of the opinion that for the purposes of RPC 1.9, the fact that you filed a Notice of Appearance means that the police officer is a former client and you must therefore comply with the requirements of RPC 1.9. WSBA Rules of Profl Conduct Comm., Advisory Op. 1578 (1994) (emphasis added).

We agree with the advice of the Bar. A lawyer appointed by an insurance company to defend two clients, and who files a notice of appearance on behalf of each of them, may not continue to represent only one of those clients without satisfying the requirements of RPC 1.9. Beatty and King could not continue to represent only the Griffith parents without Moore's waiver of the conflict. Because Beatty and King did not comply with the rule, the order disqualifying them was properly entered.

(Mike Frisch)

March 6, 2018 in Clients | Permalink | Comments (0)

Wednesday, February 7, 2018

A Fact-Specific Approach

The Minnesota Supreme Court holds that a legal malpractice case survives a statute of limitations defense.

Multiple acts by the same lawyer may give rise to separate claims for legal malpractice. To determine when multiple acts by the same lawyer are independent acts of negligence, a fact-specific approach should be used that may include weighing whether the plaintiff’s position was significantly worsened, whether the subsequent act involved the same type of conduct, whether the acts occurred at different times and during different transactions, whether the subsequent act was connected by a causal link to the first, and whether the subsequent act explicitly relied on the continued validity of the prior work.

 The loss of an opportunity to control one’s assets satisfies the "some damage" requirement for accrual of a legal-malpractice claim.

The case

At issue is whether appellant Joseph Frederick has filed a timely legal-malpractice claim under Minn. Stat. § 541.05, subd. 1(5) (2016). Frederick’s attorney, respondent Kay Wallerich, prepared an antenuptial agreement for Frederick and his then-fiancée, Cynthia Gatliff, in 2006. The agreement did not include the statutorily required witness signatures, however, thus making it unenforceable. Frederick and Gatliff were married the next day. One year later, Wallerich drafted a will for Frederick, which incorporated the antenuptial agreement by reference. According to the will, Frederick did not leave any assets to Gatliff because the antenuptial agreement already specified the portion of his assets that she was to receive upon his death. When Gatliff filed for divorce after 6 years of marriage, she alleged that the antenuptial agreement was invalid because it lacked the requisite witness signatures.

Later that year, Frederick commenced a lawsuit against Wallerich for legal malpractice. Although the invalid execution of the antenuptial agreement fell outside of the 6-year limitations period for malpractice claims, Frederick alleged that subsequent representations by Wallerich that the antenuptial agreement was valid—most significantly when Wallerich drafted his will 1 year later—were separate legal-malpractice claims that each triggered their own statute of limitations periods. Wallerich moved for judgment on the pleadings, which the district court granted, determining that all of Frederick’s claims related to the antenuptial agreement were untimely filed. The court of appeals affirmed. Because we hold that Frederick has sufficiently alleged that Wallerich’s will drafting formed the basis for a separate malpractice claim within the limitations period, we reverse and remand to the district court for further proceedings.

 (Mike Frisch)

February 7, 2018 in Clients | Permalink | Comments (0)

Monday, February 5, 2018

Too Late To Assert Arbitration Provision Was Unethical

The defendant in a suit for payment of legal fees waived its right to object to arbitration, according to a decision of the Vermont Supreme Court.

The critical question in this case is whether a party who participates extensively and without objection in an arbitration proceeding for nearly seven months prior to the actual arbitration hearing waives an objection to the validity of the arbitration agreement. Lesley Adams, William Adams, and Adams Construction VT, LLC (collectively Adams Construction) appeal the trial court’s denial of their application to vacate an arbitration award in favor of Russell Barr and the Barr Law Group (collectively Barr Law Group) and against Adams Construction. Because we conclude that Adams Construction waived its challenge to the validity of the arbitration agreement, we affirm.

After participating fully in the arbitration

On October 4, 2016, one week before the beginning of the scheduled three-day hearing, Adams Construction filed an objection to arbitration and a motion to dismiss the arbitration proceeding. Adams Construction argued, for the first time, that the arbitration provision in Adams Construction’s fee agreement with Barr Law Group was unenforceable. Adams Construction cited legal authority from Vermont and across the country suggesting that an attorney’s fiduciary duty and ethical obligations require that the lawyer take certain steps to ensure that a client’s consent to a pre-dispute, binding arbitration agreement is fully informed. These steps may include fully disclosing the risks of binding, pre-dispute arbitration clauses, identifying the legal rights a client forgoes in signing such an agreement, and giving the client a chance to consult with independent counsel before signing the agreement. Adams Construction alleged that nobody from Barr Law Group explained the legal implications of the arbitration agreement to Mr.
or Ms. Adams before or after they signed it, or advised them to get independent legal advice before signing the fee agreement. Nor did Barr Law Group explain to Adams Construction that the Vermont Bar Association provides a free arbitration service for resolution of attorney-client fee disputes. For these reasons, Adams Construction contended that the arbitration agreement was invalid and sought dismissal of the arbitration proceeding.

After losing the arbitration on all counts, an appeal was taken

We are persuaded by our own reasoning in Joder Building Corporation, as well as by those courts that have concluded that at some point prior to the actual arbitration hearing a party who participates in an arbitration proceeding without objecting to the validity of the arbitration agreement may waive the ability to make that objection...

We need not locate the line in this case, or define with precision the range of the trial court’s discretion; in this case, Adams Construction’s participation in the selection of arbitrators, filing of an answer and counterclaims, and active participation in extensive discovery and motion practice over a period of nearly six months was more than sufficient to give rise to a waiver. Our requirement of timely objections to arbitration jurisdiction was designed to avoid unnecessary investments in time and resources of exactly these types.

(Mike Frisch)

February 5, 2018 in Billable Hours, Clients | Permalink | Comments (0)

Tuesday, January 9, 2018

All Reasonable Inferences

An order dismissing a legal malpractice claim was reversed by the New York Appellate Division for the First Judicial Department

Accepting plaintiff client's allegations as true and drawing all reasonable inferences in its favor (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]), a legal malpractice claim was sufficiently alleged (see Fielding v Kupferman, 65 AD3d 437, 439 [1st Dept 2009]). Plaintiff, a lead underwriter on a public offering of a Chinese corporation, claimed that defendant law firm was negligent in failing to uncover material misrepresentations made by the corporation in connection with the offering. Plaintiff sufficiently asserted that but for defendant's negligence, plaintiff would have ceased its involvement in the public offering and avoided the fees, expenses and other damages it incurred in defending against, as well as settling claims against it (see id.).

Defendant's argument that an investigative report gave plaintiff prior constructive notice of the material misrepresentations is unavailing (cf. Ableco Fin. LLC v Hilson, 109 AD3d 438 [1st Dept 2013], lv denied 22 NY3d 864 [2014]). In Ableco, this Court granted the defendants' motion for summary judgment, dismissing the plaintiff's legal malpractice claim "on the basis of information plaintiff indisputably possessed" prior to the closing of the transaction at issue (id. at 439). Specifically, the plaintiff, the maker of commercial loans, received a press release that explicitly excluded certain property from the available inventory of a bankruptcy estate, and thus, the evidence refuted the plaintiff's claim that it was unaware that it would not be getting a first priority lien on the entire inventory (id. at 438, 439). Moreover, this Court's determination was founded not only upon the plaintiff's possession of the press release, but also on the clear and explicit presentation of the information such that counsel's legal interpretation was not required (id. at 439). Here, on a pre-answer motion to dismiss, although plaintiff acknowledges that it had possession of the investigative report, the information contained in the report cannot, at this stage, be described as explicitly putting plaintiff on notice and not requiring counsel's interpretation of the information. Defendant "may not shift to the client the legal responsibility it was specifically hired to undertake" (Escape Airports [USA], Inc. v Kent, Beatty & Gordon, LLP, 79 AD3d 437, 439 [1st Dept 2010] [internal quotation marks omitted]).

It may be reasonably inferred from plaintiff's allegations that it incurred damages attributable to defendant's conduct (see Fielding, 65 AD3d at 442), including litigation expenses incurred in an effort to avoid, minimize, or reduce the damages caused by defendant's alleged negligence (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 443 [2007]).

The decision was unanimous. (Mike Frisch)

January 9, 2018 in Clients | Permalink | Comments (0)

Tuesday, January 2, 2018

Implied Waiver Of Attorney-Client Privilege

The Tennessee Court of Appeals affirmed an order compelling disclosure of privileged communications on an implied waiver theory.

This interlocutory appeal arises out of an action in which two companies brought suit against their former attorney for legal malpractice. The attorney moved for summary judgment as to one client’s claim, contending that the claim was barred by the statute of limitations; the client responded that it learned of its cause of action within one year of the assertion of the claim. The attorney then sought through discovery to have the former client produce communications from the client’s new counsel; the client declined to produce the communications, taking the position that they were protected by the attorney client privilege. The attorney moved the trial court to compel the client to produce the communications, and the court granted the motion, holding that the client impliedly waived attorney-client privilege in asserting that the client discovered the cause of action within the year preceding the assertion of the claim. Discerning no error, we affirm the trial court’s holding.

On implied waiver

Relative to the three conditions for determining whether BNL impliedly waived the attorney-client privilege, the trial court held:

This Court concludes Plaintiffs’ assertion of the discovery rule ultimately led to Plaintiffs’ assertion that the relevant documents are protected by attorney-client privilege. Although statute of limitations is an affirmative defense under Tennessee law, and Defendants bear the burden of proof, it was Plaintiffs’ assertion of the discovery rule in response that ultimately put Plaintiffs’ knowledge, and thereby Plaintiffs’ privileged communications, at issue in the current dispute.

The Court concludes that Plaintiffs put their privileged information at issue by pleading the discovery rule. . . . by pleading ignorance of its cause of action against Defendants, Plaintiffs have made “what Plaintiffs knew and when Plaintiffs knew it” the dispositive issue of this case.

In addition, Defendants have no other way to obtain information vital to its defense. Defendants assert Plaintiffs claim was time-barred, because Plaintiffs complaint was filed more than one year after Plaintiffs became aware of Defendants behavior giving rise to the cause of action. Plaintiffs’ assertion of the discovery rule—Plaintiffs did not know and could not have reasonably known its cause of action against Defendants—makes Plaintiffs’ actual or constructive knowledge vital to Defendants’ argument that Plaintiffs did know of its claim more than a year in advance of Plaintiffs’ filing.

The court

Upon our review, we do not discern any error in the portion of trial court’s holding that “Plaintiffs’ actual or constructive knowledge [is] vital to Defendants’ argument that Plaintiffs did know of its claim more than a year in advance of Plaintiffs’ filing.”

(Mike Frisch)

January 2, 2018 in Clients, Privilege | Permalink | Comments (0)

Friday, December 29, 2017

Discovery Rule In Legal Malpractice

The United States Court of Appeals for the District of Columbia Circuit has held that a legal malpractice case survives the pleading stage

This legal-malpractice action arises from Defendant Michael M. Davidson’s representation of Houshang and Vida Momenian (the “Momenians”) in a lawsuit filed in D.C. Superior Court on August 18, 2009 (the “2009 Litigation”). The Momenians settled the 2009 Litigation on October 12, 2010, but allege Defendant failed to explain that the settlement meant all of their claims were fully and finally dismissed. On May 6, 2015, the Momenians (collectively with the Houshang Momenian Revocable Trust, “Plaintiffs”) sued Defendant for, inter alia, his allegedly negligent settlement advice. Defendant moved to dismiss pursuant to the three-year statute of limitations, arguing that if Plaintiffs had exercised reasonable diligence investigating their claims, they would have been on notice of the cause of action at some point prior to May 6, 2012. Defendant also moved to dismiss for failure to state a claim on the merits.

The District Court twice dismissed the complaint as untimely: first with leave to amend, and second with prejudice, concluding that Plaintiffs’ amended complaint failed to allege facts sufficient to overcome the timeliness bar. The District Court engaged in a thorough and careful analysis of the timeliness issue. However, taking the allegations of the complaint as true and drawing all reasonable inferences in Plaintiffs’ favor, we do not agree that Plaintiffs’ claims are conclusively time barred at the pleading stage.

Under the circumstances of this case, including the parties’ attorney-client relationship, Plaintiffs’ efforts to check in with Defendant about the 2009 Litigation every three months following the 2010 settlement plausibly fulfilled their duty to investigate their affairs with reasonable diligence. It is therefore plausible that Plaintiffs’ claims did not accrue prior to May 6, 2012. Accordingly, we reverse and remand for proceedings consistent with this opinion.

The court on the discovery rule in legal malpractice claims

Where an injury is by its nature not readily apparent, D.C. courts apply a more forgiving “discovery rule” under which a claim accrues only if a plaintiff has actual or inquiry notice of a cause of action, regardless of when the injury occurred.

...the existence and nature of a fiduciary relationship are important aspects of the relevant circumstances a court assesses to determine whether a plaintiff exercised reasonable diligence investigating claims against her fiduciary. BDO Seidman, 89 A.3d at 500 (“The analysis is highly factbound and requires an evaluation of all of the circumstances, including the conduct and misrepresentations of the defendant, the reasonableness of plaintiff’s reliance on the defendant, and the existence of a fiduciary relationship between the parties.” (quotation marks omitted)). A fiduciary relationship between a plaintiff and defendant may “reduce the significance of[] any lack of diligence on [a plaintiff’s] part,” and courts have given heightened protection to a client’s reliance upon her lawyer’s advice and representations when evaluating a plaintiff’s reasonable diligence investigating malpractice claims. See Drake v. McNair, 993 A.2d 607, 620 (D.C. 2010); Ray, 747 A.2d at 1142 (collecting cases)...

We conclude Plaintiffs’ allegations plausibly demonstrate reasonable diligence under the circumstances here. Assuming the posture of review on a motion to dismiss, we are not persuaded that calling one’s lawyer every three months to check in on a case, and relying on the lawyer’s assurances that he was “working on it,” is insufficient to fulfill a plaintiff’s duty to investigate her affairs. See Ray, 747 A.2d at 1142. It is plausible that a reasonable person would rely on an attorney’s regular assurances that he was working on a case and feel no need to investigate further, at least not after only eighteen months. Indeed, it is common knowledge that litigation often lasts for years.

Circuit Judge Wilkins authored the opinion. (Mike Frisch)

December 29, 2017 in Clients | Permalink | Comments (0)

Fiduciary Breach Claim Against Willkie Farr Survives

A legal malpractice claim was untimely but a breach of fiduciary duty claim survives, according to an opinion of the New York Appellate Division for the First Judicial Department.

In January 2001, nonparty Ramius Securities LLC hired plaintiff Dennis T. Palmeri, Jr. to serve as manager of its stock lending securities department. At some point in 2007, the Financial Industry Regulatory Authority (FINRA) began a regulatory investigation seeking information on the use of so called finders in Ramius's stock lending business. In December 2007, after having received information from Ramius in response to its initial requests, FINRA served both Ramius and plaintiff with letter requests for additional information regarding transactions that had included a finder's fee.

In preparing his responses to the FINRA request, plaintiff conferred with Ramius's General Counsel and its Chief Operating Officer, both of whom were attorneys. Plaintiff alleged that the GC and the COO informed him they were "there as his counsel," allegedly leading plaintiff to believe that an attorney-client relationship was formed.

Plaintiff left Ramius's employ in 2008. In early 2009, plaintiff retained defendant Willkie Farr & Gallagher LLP to represent him in connection with the FINRA investigation. Before undertaking any representation of plaintiff, defendant informed plaintiff that Ramius, which was then a client of defendant, would not accept any situation in which defendant was adverse to Ramius. At the same time, defendant noted that it did not foresee any set of circumstances in which plaintiff would be adverse to Ramius. Defendant sent plaintiff an engagement letter dated January 14, 2009; the letter made no mention of any conflict of interest arising from defendant's representation of both plaintiff and Ramius, nor did it enumerate the rights plaintiff would have if he and Ramius were to become adverse. Approximately one month afterward, in connection with the same FINRA investigation, Ramius also retained defendant to represent it and certain of its current or former employees.

On or about January 27, 2009, defendant represented plaintiff during his investigative examination before FINRA. In June 2009, however, defendant informed plaintiff that defendant could no longer represent him because of a conflict of interest concerning defendant's concurrent representation of Ramius and its current and former employees, and unilaterally terminated its representation of him on June 25, 2009. By letter dated September 23, 2009 from defendant to FINRA, defendant appeared to shift to plaintiff all or most of the responsibility for any alleged violations of FINRA's rules.

In January 2010, Ramius entered into a letter of acceptance, waiver, and consent (AWC) with FINRA; defendant negotiated the letter on Ramius's behalf. The AWC absolved Ramius and its employees of further liability.

On or about December 1, 2010, FINRA commenced a disciplinary proceeding against plaintiff, alleging that he had made false and misleading statements to Ramius's chief compliance officer during the FINRA investigation, thus causing Ramius to give inaccurate responses to FINRA.

The hearing on the disciplinary proceeding was held on June 28 and 29, 2011. In the months leading up to the hearing, defendant communicated with FINRA about matters related to the hearing, such as testimony to be given by Ramius employees. Moreover, at the hearing, defendant was present on behalf of Ramius and Ramius employees who testified.

By decision dated on or about November 18, 2011, the hearing panel dismissed the complaint, finding that FINRA had failed to prove by a preponderance of the evidence that plaintiff had violated FINRA rules. The panel also determined that certain of the Ramius employees who testified were not credible. On February 15, 2013, upon FINRA's appeal, the National Adjudicatory Council for FINRA upheld the hearing panel's dismissal of the FINRA complaint against plaintiff.

In the complaint in this action, dated February 15, 2013, plaintiff asserted causes of action against defendant for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, gross negligence, professional negligence, breach of contract, and breach of the implied covenant of good faith and fair dealing. Plaintiff alleged that defendant, during its representation of Ramius in the FINRA investigation, shifted all responsibility for any alleged violations of FINRA's rules to him, suggesting that plaintiff undertook certain wrongful actions without Ramius's knowledge. Plaintiff further asserted that defendant disclosed to FINRA his internal, privileged communications with Ramius's counsel, thus causing FINRA to assert charges against Palmieri. Moreover, plaintiff alleged that defendant disclosed information that it had learned during the time it represented him. Plaintiff also alleged that the FINRA complaint was primarily based on privileged statements he had made to counsel at Ramius, and that these statements were also disclosed during the course of Willkie's representation of Ramius after it ceased representing him.

Defendant moved under CPLR 3212 to dismiss the complaint as time-barred and for failure to state a claim. Plaintiff cross- moved for summary judgment in his favor. In its decision, which it read into the record, the IAS court found that all six of plaintiff's claims were premised on the same operative facts and sought identical monetary damages. Accordingly, the IAS court "merged" plaintiff's claims for gross negligence, breach of contract and breach of the implied covenant of good faith and fair dealing into his legal malpractice claim, leaving for consideration only that claim and claims based on breach of fiduciary duty.

The IAS court then dismissed both claims as untimely. Because plaintiff sought purely monetary damages, the court applied the three-year statute of limitations to the breach of fiduciary duty claim, rather than the six-year period. The court held that the claim was time-barred, since plaintiff filed it in February 2013, more than three years after defendant represented him from January through June 2009.

To begin, the motion court properly dismissed plaintiff's claims for gross negligence, breach of contract, and breach of the implied covenant of good faith and fair dealing as duplicative of his legal malpractice claim, given that they are all based on the same facts and seek the same relief (Sun Graphics Corp. v Levy, Davis & Maher, LLP, 94 AD3d 669 [1st Dept 2012]).

Plaintiff's claim for legal malpractice, in turn, is untimely. Claims for legal malpractice are subject to a three-year statute of limitations and accrue when the malpractice is committed, not when the client learns of it (Lincoln Place, LLC v RVP Consulting, Inc., 70 AD3d 594 [1st Dept 2010], lv denied 15 NY3d 710 [2010]; CPLR 214[6]). Plaintiff's legal malpractice claim first accrued on or about June 25, 2009, when defendant terminated its legal representation of him, but continued to represent Ramius in the ongoing FINRA investigation. He did not, however, file his claim until February 15, 2013, more than three years later.

In addition, the motion court correctly dismissed the claim for aiding and abetting a breach of fiduciary duty, as plaintiff is collaterally estopped from relitigating the question of whether an attorney-client relationship existed between him and his employer's in-house counsel. The identical issue was decided in the FINRA proceeding and plaintiff had a full and fair opportunity to litigate it before FINRA (see Jeffreys v Griffin, 1 NY3d 34, 39 [2003]; Auqui v Seven Thirty One Ltd. Partnership, 22 NY3d 246, 255 [2013]).

However, the IAS court should have permitted the breach of fiduciary duty claim to proceed. The IAS court correctly noted that the claim was subject to a three-year statute of limitations. The court was mistaken, however, in finding that the allegedly wrongful conduct ended on June 25, 2009, when defendant unilaterally terminated its representation of plaintiff. On the contrary, defendant's conduct extended through at least June 29, 2011, during which time it represented Ramius and its employees in their participation at plaintiff's FINRA disciplinary hearing.

Here, plaintiff alleges not only that defendant breached its fiduciary duty when it terminated its professional relationship with him, but also when, until at least June 2011, it acted in a manner directly adverse to his interests. Where there is a series of continuing wrongs, the continuing wrong doctrine tolls the limitation period until the date of the commission of the last wrongful act (Harvey v Metropolitan Life Ins. Co., 34 AD3d 364 [1st Dept 2006]; see also Ring v AXA Fin., Inc., 2008 NY Slip Op 30637[U] [Sup Ct, NY County 2008] [applying continuing violations doctrine to General Business Law § 349 claim where initial payments occurred outside statute of limitations but "the insurer [] continued to bill, and ... [plaintiff] ... continued to pay" within three years of filing suit]).

Here, plaintiff has presented evidence of a "continuing wrong," which is "deemed to have accrued on the date of the last wrongful act" (Leonhard v United States, 633 F2d 599, 613 [2d Cir. 1980], cert denied 451 US 908 [1981]; Harvey, 34 AD3d at 364). Indeed, the record contains evidence sufficient to create an issue of fact as to whether defendant breached its fiduciary obligations to plaintiff after June 2009 and well into June 2011 during its ongoing representation of the Ramius parties.

For example, as noted, the record contains evidence that in the early portion of 2011, defendant helped Ramius identify witnesses who would testify against plaintiff at his FINRA disciplinary hearing. Similarly, defendant was present on behalf of Ramius and Ramius employees who testified at plaintiff's FINRA hearing on June 28 through 29, 2011 — a hearing at which the employees gave testimony that was generally adverse to plaintiff's interests. This evidence is sufficient for a fact-finder to determine that defendant breached its duty of loyalty to plaintiff, a former client (see Cooke v Laidlaw, Adams & Peck, 126 AD2d 453, 456 [1st Dept 1987] [ethical standards applying to the practice of law impose a continuing obligation upon lawyers to refuse employment in matters adversely affecting a client's interests, even if the client is a former client]).

(Mike Frisch)

December 29, 2017 in Clients | Permalink | Comments (0)

Tuesday, December 12, 2017

Legal Malpractice SOL In Tennessee

From the web page of the Tennessee Supreme Court

The Tennessee Supreme Court extensively analyzed when the statute of limitations begins to run in legal malpractice cases. While the Court declined to change current Tennessee law or adopt a new doctrine, it held that both the trial court and appellate court were incorrect as to when the plaintiffs’ cause of action accrued, and it reversed the earlier summary judgment granted in favor of the defendant attorneys.

In the case, the plaintiffs were represented by the defendant lawyers in a lender liability lawsuit against two banks and one individual. In the underlying lender liability lawsuit, the trial court issued a summary judgment against one of the banks and the individual on May 7. The defendant attorneys voluntarily dismissed the complaint against the second bank on November 13, telling the client the damages evidence was not ready and the lawsuit could be refiled. The consequence of the voluntary dismissal was the finalization of the summary judgment order and the preclusion of any subsequent lawsuit against those defendants.

The plaintiffs sued the defendant attorneys on September 3 of the following year. The plaintiffs claimed the lawsuit against the individual was the only lawsuit that was ever viable and that they suffered damages when the summary judgment became final. The question before the courts was whether the statute of limitations began on May 7, when the motion for summary judgment was granted, or on November 13, when the voluntary dismissal was entered.

In its opinion, the Court reaffirmed its commitment to following the “discovery” rule for determining when the statute of limitations begins to run in legal malpractice cases, as originally set forth in Carvell v. Bottoms. Under the discovery rule, a cause of action accrues when the plaintiffs suffer an actual injury as a result of the defendants’ wrongful or negligent conduct and plaintiffs know or in the exercise of reasonable diligence should have known that this injury has been sustained as a result of wrongful or negligent conduct by the defendants. At the urging of the plaintiffs, the Court analyzed other possible methods for determining when a legal malpractice action accrues, including the continuous-representation rule, appeal-tolling doctrine, and final judgment rule, but concluded none was preferable to Tennessee’s current “discovery” standard.

In applying the current standard to the facts of the case, the Court held that the plaintiffs did not suffer a discoverable injury until after the voluntary dismissal was entered. Until that time, the summary judgment issued against one of the banks and the individual defendant was not a final order under Rule 54.02 of the Tennessee Rules for Civil Procedure and was subject to revision. The Court reversed the judgments of the trial court and Court of Appeals and remanded the case to the trial court for further proceedings.

To read the full opinion in John Howard Story, et al. v. Nicholas D. Bunstine, et al., authored by Justice Roger A. Page, please visit the opinions section of

(Mike Frisch)

December 12, 2017 in Clients | Permalink | Comments (0)

Friday, December 8, 2017

"Gross Speculations"

The plaintiff in a legal malpractice complaint was free to amend the allegations but the case was "nevertheless" properly dismissed

Nevertheless, the amended complaint must be dismissed, because plaintiff's claim that, but for defendants' negligence, he would have recovered the full $3 million that he was owed during the bankruptcy filed by nonparty Majestic Capital, Ltd., consists of "gross speculations on future events" (Sherwood Group v Dornbush, Mensch, Mandelstam & Silverman, 191 AD2d [*2]292, 294 [1st Dept 1993]; see also Heritage Partners, LLC v Stroock & Stroock & Lavan LLP, 133 AD3d 428 [1st Dept 2015], lv denied 27 NY3d 904 [2016]; Turk v Angel, 293 AD2d 284 [1st Dept 2002], lv denied 100 NY2d 510 [2003]).

The New York Appellate Division for the First Judicial Department decision is linked here.  (Mike Frisch)

December 8, 2017 in Clients | Permalink | Comments (0)

Tuesday, November 14, 2017

At Most An Error Of Judgment, No Malpractice

The New York Appellate Division for the First Judicial Department affirmed the dismissal of a counterclaim alleging legal malpractice

Defendant alleges that plaintiff committed legal malpractice by failing to file a timely motion for attorneys' fees in a federal patent proceeding in which it represented defendant. Defendant relies on Federal Rules of Civil Procedure rule 54(d)(2)(B), which sets the deadline at 14 days after entry of a judgment in the proceeding. It alleges that 16 months after the deadline, and following extensive posttrial proceedings, plaintiff moved for attorneys' fees as a sanction. As the motion court found, federal case law holds that a motion for attorneys' fees is timely under rule 54(d)(2)(B) when filed 14 days after the entry of judgment or within 14 days of the resolution of postjudgment motions (see e.g. Sorenson v Wolfson, 170 F Supp 3d 622, 628 [SD NY 2016], affd 683 Fed Appx 33 [2d Cir 2017]). Thus, the court correctly dismissed the counterclaim for failure to state a cause of action for legal malpractice predicated on the missed deadline.

On appeal, defendant argues that plaintiff's filing of a sanctions motion, instead of a motion for attorneys' fees as the prevailing party pursuant to 35 USC § 285, constitutes malpractice. We may entertain this new legal argument because it appears on the face of the record, involves no new facts, and is determinative (Vanship Holdings Ltd. v Energy Infrastructure Acquisition Corp., 65 AD3d 405, 408 [1st Dept 2009]). However, the argument does not avail defendant.

The record shows that plaintiff had contemplated filing a motion pursuant to 35 USC § 285 and decided against it. The statute provides that the court may award attorneys' fees to the prevailing party "in exceptional cases" (see Octane Fitness, LLC v Icon Health & Fitness, Inc., __ US __, __, 134 S Ct 1749, 1756 [2014]). Plaintiff advised defendant that it would be a "stretch" to argue prevailing party under § 285. Thus, defendant's theory that plaintiff breached a duty of care to it by choosing to apply for attorneys' fees via a sanctions motion instead of a motion under § 285 amounts to no more than an allegation that plaintiff made an error in judgment, which does not state a cause of action for malpractice (see Rosner v Paley, 65 NY2d 736, 738 [1985]; Sitomer v Goldweber Epstein, LLP, 139 AD3d 642 [1st Dept 2016], lv denied 28 NY3d 906 [2016]).

Moreover, defendant failed to allege that the choice of a sanctions motion rather than a motion under § 285 was a proximate cause of its claimed injury, since there are no allegations in the counterclaim that would establish that the patent proceeding was an exceptional case [*2]warranting attorneys' fees (see Octane Fitness, 134 S Ct at 1756).

We have considered defendant's remaining arguments and find them unavailing.

(Mike Frisch)

November 14, 2017 in Bar Discipline & Process, Clients | Permalink | Comments (0)

Friday, November 10, 2017

Seven Of Eight Badges Of Fraud

The Alaska Supreme Court resolved (with a limited remand) a lengthy battle between a law firm and its Native corporation client.

An attorney represented a Native corporation in litigation nearly three decades ago. The corporation disputed the attorney’s claim for fees, and in 1995, after the attorney’s death, the superior court entered judgment on an arbitration award of nearly $800,000 to the attorney’s law firm, then represented by the attorney’s son. The corporation paid eight installments on the judgment but eventually stopped paying, citing financial difficulties. The law firm sought a writ of execution for the unpaid balance, and the writ was granted. The corporation appealed but under threat of the writ paid $643,760 while the appeal was pending. In a 2013 opinion we held the writ invalid and required the firm to repay the $643,760.

The corporation was never repaid. The original law firm moved its assets to a new firm and sought a stay of execution, averring that the original firm now lacked the funds necessary for repayment. The corporation sued the original firm, the successor firm, and the son for breach of contract, fraudulent conveyance, conspiracy to fraudulently convey assets, violations of the Unfair Trade Practices Act (UTPA), unjust enrichment, and punitive damages. The firm counterclaimed, seeking recovery in quantum meruit for attorney’s fees it claimed were still owing for its original representation of the corporation.

The superior court granted summary judgment for the corporation on the law firm’s quantum meruit claim and, following trial, found that the son and both law firms fraudulently conveyed assets and were liable for treble damages under the UTPA.

The son and the law firms appeal. They argue that the superior court erred in these ways: (1) holding that the quantum meruit claim was barred by res judicata; (2) holding the defendants liable for fraudulent conveyance;(3) awarding damages under the UTPA; and (4) making mistakes in the form of judgment and award of costs. But seeing no error or abuse of discretion in the superior court’s decision of most of these issues, we affirm its judgment, with one exception. We remand for reconsideration of whether all three defendants are liable for prejudgment interest from the same date. 

The fee issue

 In 2013 we reversed the superior court’s grant of the writ of execution. We held that “Leisnoi’s contingency fee agreement with Merdes violated [the Alaska Native Claims Settlement Act’s] prohibition against contingency fee agreements, as did the Arbitration Panel’s fee award, the superior court’s 1995 entry of judgment, and the 2010 writ of execution.” Leisnoi was therefore “entitled to recover the balance that it paid after the writ of execution was unlawfully issued.”

After that setback and given the opportunity to prove quantum meruit, the law firm's actions were rebuked

This transfer of assets, the [lower] court concluded, was “simply not defensible.” The court considered eight “badges of fraud” and found that seven of them “weigh[ed] strongly in favor of finding that the capitalization of [Merdes Law Office] with the assets of [Merdes & Merdes] was done with the intent to defraud Leisnoi and prevent the payment of the debt owed to Leisnoi.” The court found that the fraudulent conveyance was also by definition a deceptive and unfair act for purposes of the UTPA, and that all three defendants — Merdes & Merdes, Merdes Law Office, and Ward Merdes — violated the UTPA by participating in the asset transfer. The court therefore voided the transfers to Merdes Law Office and Ward Merdes and found Merdes & Merdes, Merdes Law Office, and Ward Merdes jointly and severally liable for Leisnoi’s compensatory .damages. Pursuant to the UTPA the court trebled this amount to $1,931,280.

The underlying representation involved title to land on Kodiak Island. (Mike Frisch)

November 10, 2017 in Clients | Permalink | Comments (0)

Friday, October 20, 2017

Bad Advice Established Malpractice

An attorney's erroneous advice that a client could receive retroactive child support if she waited to establish the father's paternity formed the basis of a legal malpractice action.

The attorney had persisted in the bad advice even after an associate expressed the contrary view to the client. 

The Vermont Supreme Court reversed a trial court and concluded that the plaintiff established both causation and damages from the advice. 

After negotiations over support with the father broke down

Given the father’s attorney’s stance, defendant finally researched the law governing child support arrears to confirm her position. At this point, defendant discovered that she had provided incorrect advice to plaintiff regarding retroactive child support. Instead, in a letter to plaintiff acknowledging her error, defendant explained that no definitive law authorized arrears back to a child’s birth and the date of retroactivity was generally at the trial court’s discretion. In practice, moreover, “courts use the date of filing as opposed to the date of birth.” After receiving this letter, plaintiff told her mother’s friend, “This is devastating news . . . . I can hardly see straight [sic] I’m so angry and upset.”

Subsequently, in a letter to the father’s attorney, defendant acknowledged that her research revealed that she had been mistaken about the date of retroactivity. In the same letter, defendant also wrote: “Without a doubt, had the rules on retroactivity of support been more clear, [plaintiff] would have filed a parentage action as soon as [her daughter] was born.”

When the client sued 

the [lower] court determined that plaintiff failed to prove the negligent representation was a “cause-in-fact” of plaintiff’s injury and that the evidence was“equivocal” as to whether plaintiff would have decided to file immediately had she been aware of the risk. It also found insufficient evidence for nonspeculative monetary damages.

The court on causation

Our case law demonstrates that the court’s factual findings easily establish, by a preponderance of the evidence, that defendant’s negligent advice was the cause-in-fact of plaintiff’s injury...

Defendant’s arguments to the contrary are based on an alternative theory of causation and are not persuasive. She suggests that plaintiff would have delayed filing even if she had been given the correct advice. For example, defendant speculates that the father would have become belligerent if the parentage action had been filed immediately and claims that, because defendant’s advice avoided the possibility of a contentious custody battle, plaintiff would have delayed filing. This argument is not supported by the findings, which indicate that, when plaintiff communicated her pregnancy to the father, he expressed his desire to avoid interactions with both plaintiff and their child. The only indication of contentious behavior was the father’s tangential statement that litigation could turn his mother into a “mad dog”—a statement he made after the parentage action was filed and child custody had been settled. These findings show indifference, rather than bellicosity. Similarly, the trial court’s conclusion that plaintiff’s primary goal was custody of her child is not supported by the findings; at most, the findings demonstrate equal goals of custody and child support. Finally, defendant claims, and the court found, that her letter to the father’s attorney reflected a negotiating strategy, “not an admission directly establishing that [defendant] would have deviated from her advice to delay litigation.” This may have been defendant’s hidden intent, but the language of the letter plainly states that plaintiff would have filed had she been given correct advice. And this conclusion is sufficiently supported by the other factual findings described above.

And damages

Despite this clear causal link between defendant’s negligence and the damages suffered, the trial court relied on two faulty assumptions when it found that the alleged damages were speculative. First, the court stated that plaintiff submitted no evidence to support an award of $1875 per month from the date of her child’s birth; that is, the evidence did not establish that the monthly payment for the first fifteen months would have been the same child support amount that the father and plaintiff stipulated to after negotiations between their attorneys. Instead, the court noted that the father submitted two financial affidavits that resulted in two different child support calculations under Vermont’s child support guidelines. One of the affidavits considered the father’s family gift income, while the other did not. Either with the gift income or without the income, the father’s child support obligation calculated from the affidavits would have been less than $1875 per month. Because these amounts were lower than the stipulated amount and because the father could have contested the inclusion of gift income, the court concluded that the father’s income could not be determined in the absence of the stipulation and that, as a result, any award was speculative.

Similarly, the trial court’s second assumption is flawed. The trial court determined that the damages were speculative because—summed up over the entire length of the child support obligation—the $1875 monthly payment effectively made up for the fifteen months of missing child support. In making this argument, the court again relied on the two hypothetical child support awards calculated from the father’s financial affidavits. In comparison to those amounts, the court concluded that, based on the $1875 monthly payment, plaintiff would receive more total child support over the length of the child support obligation than she would have received based on either amount calculated from the father’s financial affidavits, even if the child support payments would have begun at the child’s birth.

The court remanded for a calculation of damages.

We note that the court has several options for computing damages, including the stipulated child support order of $1875 per month, the two other child support orders based on the father’s financial affidavits (either with or without his family gift income), or the loan amount accrued from her mother and her mother’s friend. Of course, whatever total the trial court arrives at, it must be supported by the evidence and it must make defendant whole for the period she did not receive child support payments.

But rejected an award of legal fees

Here, no bad faith exists and plaintiff did not pursue this action against a third party, so we decline to award attorney’s fees.

Justice Carroll dissented

the trial court’s findings and the record as a whole support the conclusion that plaintiff failed to demonstrate that “but for” defendant’s negligence, she would have filed her parentage complaint sooner. The trial court’s application of a standard more deferential to plaintiff does not change, but supports, this result.

(Mike Frisch)

October 20, 2017 in Clients | Permalink | Comments (0)

Wednesday, October 11, 2017

Judicial Error And Legal Malpractice: Claim Against Law Firm Reinstated

The Massachusetts Supreme Judicial Court reversed a lower court summary judgment in favor of a law firm in a malpractice action

The issue on appeal is whether, in a legal malpractice action, a court's error of law constitutes a superseding cause that bars recovery to the plaintiff client even where the defendant attorney was negligent for failing to prevent or mitigate the legal error. The plaintiff, Kiribati Seafood Company, LLC (Kiribati), brought a legal malpractice claim against its former law firm, Dechert LLP (Dechert). Kiribati alleged that Dechert negligently failed to provide a French appellate court with the evidence the court deemed necessary for Kiribati to prevail on a claim, which resulted in the court's denial of the claim. A judge of the Superior Court granted summary judgment to Dechert and denied partial summary judgment to Kiribati. The judge determined that the French appellate court committed an error of law in requiring this evidence and that, even if Dechert were negligent in failing to provide the evidence to the court, Kiribati could not recover damages for Dechert's negligence because the court's legal error was a superseding cause of the adverse decision. We conclude that an error of law under these circumstances is a concurrent, not a superseding, proximate cause and that the judge therefore erred in granting summary judgment to Dechert and denying partial summary judgment to Kiribati.

(Mike Frisch)

October 11, 2017 in Clients | Permalink | Comments (0)

Thursday, September 21, 2017

Attorneys Not Liable For Distributing Settlement Proceeds To Client; Third Party Had No "Just Claim"

Attorneys were not liable for distributing settlement proceeds of a wrongful eviction claim to their client rather than a third party claiming entitlement per a decision of the District of Columbia Court of Appeals

Mr. Banks hired Mr. Zucker and Ms. Daus to represent him in the wrongful eviction case against ESB. Before any suit was filed, Mr. Banks signed a settlement with ESB that gave Mr. Banks $100,000 in exchange for a release of the wrongful eviction and other claims. Mr. Papageorge learned of the settlement two days later, and his lawyer told Mr. Zucker that Mr. Papageorge had a claim to the settlement money. The same day, Mr. Papageorge showed Ms. Daus a copy of his agreement with Mr. Banks and his cotenant along with documentation of $88,740.86 in costs and fees he claimed he was owed. Despite Mr. Papageorge‘s repeated demands, Mr. Zucker and Ms. Daus refused to pay him out of the settlement money, and instead disbursed the money to their client, Mr. Banks. Mr. Papageorge asked the lawyers to stop payment on a check they had already given Mr. Banks, warning that the money would soon be gone because Mr. Banks would spend it, but they rebuffed him.

The attorneys were sued for conversion and negligence in which the plaintiff

contends that an attorney also owes a duty of care to a nonclient third party who presents the attorney with a "just claim" against property in the attorney‘s possession.

He had no "just claim" under Rule 1.15 and the disciplinary rules did not form a basis for civil liability.

The "just claim" concept stems from Rule 1.15 of the District of Columbia Rules of Professional Conduct, which governs the ethical obligations of a lawyer who is in possession of property in which others claim an interest. In particular, the rule requires a lawyer to "promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive." Rule 1.15 (c). Comment 8 on Rule 1.15 states:

Third parties, such as a client‘s creditors, may have just claims against funds or other property in a lawyer‘s custody. A lawyer may have a duty under applicable law to protect such third-party claims against wrongful interference by the client, and accordingly may refuse to surrender the property to the client.

The rule does not create an obligation to the plaintiff enforceable in civil litigation

Mr. Papageorge identifies no source of "applicable law" under which Mr. Zucker and Ms. Daus owed him a duty of care other than Rule 1.15 itself and the case law interpreting that rule. Yet as Mr. Papageorge concedes, the Rules of Professional Conduct do not give rise to a private cause of action for their violation.

Here, Mr. Papageorge signed a contract with Mr. Banks and his cotenant that gave him a right to the proceeds from the tenants‘ wrongful eviction claims, but this right was a contractual right enforceable against Mr. Banks and the cotenant, not a property right enforceable against whomever might be in possession of those proceeds. As Mr. Papageorge‘s only entitlement to the settlement money stemmed from the as-yet-unperformed contract with Mr. Banks and his cotenant, he did not have any property rights in the settlement money when he made his demand, and his conversion claim therefore fails.

Associate Judge Beckwith authored the opinion. (Mike Frisch)

September 21, 2017 in Bar Discipline & Process, Clients | Permalink | Comments (0)

Wednesday, September 20, 2017

Judge Should Have Recused But Error Harmless

The South Dakota Supreme Court affirmed a fourth-degree rape conviction

Approximately one month before [defendant] Shelton’s trial, his attorney moved to withdraw from the case. Shelton’s former cellmate came forward with information that Shelton confessed to him that Shelton had committed the rape. The attorney represented both Shelton and the former cellmate. Due to the conflict, the court allowed the attorney to withdraw and appointed a new attorney to represent Shelton. A week later, the circuit judge overseeing the matter sent a letter to the new attorney disclosing that the judge’s ex-wife is a partner in the new attorney’s law firm and that this was a potential basis for disqualification. The judge stated:

You are now advised that I will disqualify myself from this proceeding, and another judge will be assigned to hear this case, unless you and your client agree in writing that I should not be disqualified, and that I may continue to preside over this action.


A written agreement waiving disqualification was not provided and there was no further mention of the issue in the record. Nevertheless, the same judge continued to preside over the trial.

The court concluded that the judge erred in failing to recuse but

In upholding the conviction in this case, there is little risk of injustice to the parties. Initially, Shelton does not argue that the judge was biased or prejudiced against him in any way. Instead, Shelton erroneously argues that the judge lacked jurisdiction to proceed in the case, and as a result, the judgment of conviction was void. A thorough review of the record does not reveal any evidence of partiality. Further, it is not alleged, and it does not appear from the record, that the judge’s ex-wife had any involvement in the matter. And while Shelton argues that in his experience, “an overwhelming majority of divorce cases have at least some level of animosity[,]” none was shown here...

There is also little risk that denial of relief would produce injustice in other cases. Unlike the situation presented in Liljeberg, where the judge failed to disclose the potential basis for disqualification to the parties, the judge in this case upheld his ethical obligations under the Code of Judicial Conduct and made a full disclosure. The judge sent a letter to Shelton’s counsel informing him of the potential basis for disqualification and filed the letter in the record. Although the judge erred by continuing to preside over the matter absent a waiver, Shelton compounded this error by failing to raise it.

The court held that the error was harmless. (Mike Frisch)

September 20, 2017 in Clients, Judicial Ethics and the Courts | Permalink | Comments (0)

Friday, September 1, 2017

Border Ethics Explored

Matt Kaiser (a former student of mine and present member of the D.C. Board on Professional Responsibility) has an article at Above the Law on a Bar Association of the City of New York Committee on Professional Ethics opinion  which is summarized below

Under the New York Rules of Professional Conduct (the “Rules”), a New York lawyer has certain ethical obligations when crossing the U.S. border with confidential client information. Before crossing the border, the Rules require a lawyer to take reasonable steps to avoid disclosing confidential information in the event a border agent seeks to search the attorney’s electronic device. The “reasonableness” standard does not imply that particular protective measures must invariably be adopted in all circumstances to safeguard clients’ confidential information; however, this opinion identifies measures that may satisfy the obligation to safeguard clients’ confidences in this situation. Additionally, Under Rule 1.6(b)(6), the lawyer may not disclose a client’s confidential information in response to a claim of lawful authority unless doing so is “reasonably necessary” to comply with a border agent’s claim of lawful authority. This includes first making reasonable efforts to assert the attorney-client privilege and to otherwise avert or limit the disclosure of confidential information. Finally, if the attorney discloses clients’ confidential information to a third party during a border search, the attorney must inform affected clients about such disclosures pursuant to Rule 1.4.

(Mike Frisch)

September 1, 2017 in Clients | Permalink | Comments (0)

Thursday, August 31, 2017

Wrongful Death Case Filed For Late Spouse Not Null And Void As Unauthorized Practice

A decision summarized on the web page of the Tennessee Supreme Court

The Tennessee Supreme Court has rejected a defendant hospital’s argument that a wrongful death lawsuit filed by a surviving spouse was null and void because the spouse was not represented by a lawyer when the lawsuit was filed.   

In September 2004, Ruth Hartley was admitted to Trinity Hospital in Erin, Houston County, Tennessee, for elective colon surgery.  She developed complications from the surgery and died.  After her death, Mrs. Hartley’s husband, Denver Hartley, filed a wrongful death lawsuit against several defendants, including Trinity Hospital, claiming that their negligent treatment caused Mrs. Hartley’s death.  Mr. Hartley was not represented by a lawyer when he filed the lawsuit.

The defendants filed motions to dismiss Mr. Hartley’s lawsuit.  They argued that, although a person can represent himself in his own lawsuit, no one can file a lawsuit on behalf of another person unless they have a law license.  The defendants claimed that, in filing the wrongful death lawsuit, Mr. Hartley was representing either Mrs. Hartley or their adult children, so he was practicing law without a license. For that reason, they argued, Mr. Hartley’s lawsuit must be dismissed.

Mr. Hartley soon hired an attorney, and he amended his lawsuit to show that he was represented by a lawyer.  By that time, though, the statute of limitations for the wrongful death claim had run.  The defendants argued that the first complaint was null and void because Mr. Hartley was not represented by a lawyer, and the legal time limit had passed by the time Mr. Hartley hired a lawyer and filed an amended complaint, so his lawsuit had to be dismissed.

The trial court held that the fact that Mr. Hartley was not represented by a lawyer when he filed the lawsuit did not make it null and void, so it refused to dismiss the lawsuit.  While the lawsuit was pending, Mr. Hartley died, and his daughter, Linda Beard, was substituted in his place as the plaintiff. The case went to trial, and the jury awarded damages to Ms. Beard. 

The hospital appealed, and the Court of Appeals reversed.  It held that the claim belonged to the decedent, Mrs. Hartley, and that Mr. Hartley could not file a lawsuit on behalf of his deceased wife without a lawyer.  The Court of Appeals held that the first wrongful death complaint was null and void, and Mr. Hartley hired a lawyer after the statute of limitations had run, so it dismissed the case.  The Tennessee Supreme Court granted Ms. Beard permission to appeal.

The Supreme Court reversed the Court of Appeals.  It held that the wrongful death claim did not actually belong to the decedent; under Tennessee law, upon Mrs. Hartley’s death, the claim passed to her surviving spouse, Mr. Hartley.  Because Mr. Hartley had the right to represent himself in his own lawsuit, the Court held, the original complaint, filed without a lawyer, was at least partially proper.  The Supreme Court agreed with the trial court that the lawsuit was timely, so it reversed the Court of Appeals’ dismissal of the lawsuit.     

To read the unanimous opinion in Linda Beard v. James William Branson and Trinity Hospital, L.L.C., authored by Justice Holly Kirby, go to the opinions section of

(Mike Frisch)

August 31, 2017 in Clients, Current Affairs | Permalink | Comments (0)

Monday, August 28, 2017

Legal Malpractice Claim Survives Where Firm Role In Dispute

The Massachusetts Supreme Judicial Court vacated and affirmed in part  the disposition of a legal malpractice case where the parties disagreed as to when the attorney - client relationship started and ended.

The case was assigned to attorney Quigley, who left the Todd firm. There was disagreement as to the firm's role post Quigley's departure but

There is no dispute that Cesso never communicated to Todd or the Probate and Family Court any objection to Todd's filing a notice of withdrawal in the divorce action. Cesso never objected to Todd's lack of response to any of the seven e-mails copied to Todd after July 28, 2008, and ceased communicating with Todd substantively about the case after August 21, 2008. Todd was not present in court for the first two days of trial, Septemeber 8 and 9, 2008. Cesso did not object to Todds absence.

Cesso sued Quigley and later added Todd as a defendant. 

The question at issue here is whether Todd's attorney client relationship with Cesso continued after July 28, 2008. The motion judge found that, as a matter of law, Todd ceased being Cesso's attorney in the divorce action on the date Todd signed the notice of withdrawal. We disagree. On this record, "reasonable persons could differ as to the existence of an attorney-client relationship," so "this issue must be resolved by the trier of fact."

 ...Todd expressly told Cesso that, after Todd's withdrawal as counsel of record, Todd and Quigley would "continue to work together and consult on [Cesso's] case." This was consistent with the established division of labor, with Todd settingstrategy and Quigley executing that strategy. Cesso took actions, such as copying Todd on e-mails, corroborating that Cesso thought Todd was still working on the case. Resolving all evidentiary inferences in favor of Cesso, Todd took no steps to disabuse Cesso of the notion that he (Todd) was still working on the case, albeit in a behind-the-scenes role. Instead, Todd sent a billing cover letter that a reasonable person could read to indicate that he would continue to work and bill on the case. The record, though thin, is enough to permit -- but not require-- the finder of fact to draw the inference that Cesso reasonably believed that Todd was continuing to consult in the background.

 The dismissal of a misrepresentation count was affirmed. (Mike Frisch)

August 28, 2017 in Clients | Permalink | Comments (0)

Tuesday, August 15, 2017

Bankruptcy Does Not Bar Legal Malpractice Claim

The Massachusetts Supreme Judicial Court reversed the dismissal of a legal malpractice claim

In September 2009, the plaintiff retained the defendants as personal injury counsel to represent her with respect to serious injuries she sustained when she slipped and fell on ice the year before. Approximately one month later, acting pro se, she filed for bankruptcy protection, and received a bankruptcy discharge in early 2010. Thereafter, in 2011, the defendants allowed the statute of limitations on the personal injury claim to expire without filing suit. This legal malpractice suit followed. The question on appeal is whether
the plaintiff's malpractice claims were properly dismissed on summary judgment on the ground that the bankruptcy action (or the position the plaintiff took in it) foreclosed them. We reverse.

Plaintiff did not disclose the claim on her pro se bankruptcy petition but referred to it in response to trustee questions at a meeting of creditors

The defendants argue that the plaintiff's malpractice claim is barred by the earlier bankruptcy and her failure to disclose the underlying personal injury suit.

The malpractice claim was never part of the bankruptcy estate but

There remains, however, the question whether the malpractice claim had any value or, put another way, whether the plaintiff would be able to show causation or harm, given her
failure to disclose the personal injury claim in the bankruptcy. We turn to that question now...

As soon as the plaintiff filed her bankruptcy petition, her personal injury claim became an asset of the bankruptcy estate, and the trustee was responsible for pursuing it for the benefit of the estate and its creditors...That interest did not terminate on the bankruptcy discharge; indeed, had the defendants filed suit on the plaintiff's behalf after the bankruptcy discharge, but before the statute of limitations had elapsed, the "usual remedy [would be] to substitute as the real party in interest the trustee of the bankruptcy estate in the place and stead of the former debtor."

...because the value of the malpractice claim (which was never an asset of the bankruptcy) is tied to the value of the underlying personal injury suit (which was), the trustee may have an interest in any recovery on the malpractice claim -- at least to the extent of the value of the claims discharged in bankruptcy. On remand, the judge and the parties should accordingly ensure that the trustee is notified of the existence of a potential interest in any recovery.

Nor did judicial estoppel prevent the malpractice suit. (Mike Frisch)

August 15, 2017 in Clients | Permalink | Comments (0)