Exoneration Not Required

The Utah Supreme Court affirmed and clarified its holding that a criminal defendant can sue counsel for malpractice without proving actual innocence

This is a legal malpractice case that is before us on interlocutory appeal. The malpractice claim was asserted by plaintiff Paul Paxman against his former attorney Brian King. King represented Paxman, an optometrist, in a criminal case arising out of Paxman’s Medicaid billing for his services. On advice from King, Paxman pled guilty to charges under the Fraudulent Insurance Act, UTAH CODE § 76-6-521, and the False Claims Act, id. § 26-20-7. And Paxman was then placed on a federal exclusion list, which prevented him from participating in federal health care programs and billing a number of insurance companies.

On successful completion of probation, Paxman’s charges were reduced from third-degree felonies to Class A misdemeanors under Utah Code section 76-3-402. Shortly thereafter Paxman sued King for legal malpractice. He alleged that King failed to inform him of the consequences of pleading guilty or to advise him of the likelihood of success at trial.

The District Court had declined to rule on whether actual innocence or exoneration was necessary but

Around the time we heard King’s appeal, another case came before us presenting the same issues—Thomas v. Hillyard, 2019 UT 29,--- P.3d ---. We received full briefing and heard argument in that case. And we decided that neither the exoneration rule nor the actual innocence requirement have a place in our malpractice law. Id. ¶¶ 13–14. We reinforce that decision here. In doing so, we address a few arguments presented by King not considered in Thomas.

As to potential inconsistent judgments

We decline to endorse the blanket rules that King advocates on the basis of these policy concerns. The inconsistent judgment concern assumes that a judgment against an attorney in a legal malpractice action equates to a determination that the client is innocent of the underlying crime. But that does not necessarily follow. A judgment in the legal malpractice action simply reflects the fact that a breach of the duty of care resulted in an injury to the attorney’s client. It says nothing definitive about the client’s guilt or
innocence in the underlying criminal matter. Even if a client determines that postconviction relief is appropriate, moreover, or helpful in establishing causation, that will not necessarily open the door to inconsistent judgments. District courts retain the inherent power to stay civil malpractice suits until postconviction proceedings are completed, in a manner avoiding the risk of inconsistent judgments.