by Christopher J. Graham and Joseph P. Kelly

Jeanes v. Bank of America, 2013 WL 856385 (Kan. Mar. 8, 2013)

Administrator of estate sued decedent’s attorney for negligence and breach of fiduciary duty. The decedent’s estate totaled nearly $40 million and estate and inheritance taxes were about $22 million. Court held that the administrator’s cause of action accrued when the taxes were due after the client’s death, and, thus, that cause of action couldn’t survive the client’s death. The case was dismissed because it didn’t qualify as a survival action under Kansas law.

by Christopher J. Graham and Joseph P. Kelly

Evans v. Howell, Case No. 2011-CA-01414-COA (Miss. App. March 5, 2013)

Plaintiff filed suit alleging defendant lawyer prepared buy-sell agreements for plaintiff and plaintiff’s business partner’s various business entities. Under Mississippi law, a legal malpractice claim must be brought within three years after the claim accrued; and claims accrue on the date the client learns or, through the exercise of reasonable diligence, should learn of his lawyer’s negligence. Here, the alleged malpractice stems from defendant lawyer’s preparation of a buy-sell agreement in March 2005. Appeals court agreed with trial court that plaintiff knew or should have known of the alleged malpractice in March 2005 when he signed the agreement; and thus the complaint was barred by the three-year statute of limitations.

by Christopher J. Graham and Joseph P. Kelly

Hayes v. Hutchinson, Case No. B237556 (Ca. Ct. App. 2nd Jan. 24, 2013) (unpublished)

Appellate court affirmed trial court’s order denying defendant lawyer’s anti-SLAPP motion to strike. Defendant lawyer had been hired by the band “Linkin Park” to review royalty agreements negotiated by plaintiff lawyer. Plaintiff lawyer sued defendant lawyer for defamation, trade libel and intentional interference with contractual relations based on statements made by defendant lawyer in an audit report critical of plaintiff lawyer’s conduct. Defendant lawyer filed a motion to strike under California’s anti-SLAPP law which provides, in part, that statements made in anticipation of litigation are protected speech. Here, defendant lawyer claimed that his report was a statement in anticipation of litigation because he was asked to prepare it by a legal malpractice attorney retained by the band. But defendant lawyer ultimately failed to meet his burden that the statements were made in anticipation of litigation because the evidence showed that the band didn’t have plans to sue plaintiff lawyer.

by Christopher J. Graham and Joseph P. Kelly

American Zurich Ins. Co. v. Wilcox and Christopoulus, LLC, et al, Case No. 1-12-0402 (Ill. App. Ct. 1st Dist. Jan. 17, 2013)

Insurer filed suit against insured lawyer and law firm seeking a declaration of no duty to defend. Trial court found no duty to defend lawyer but found a duty to defend the law firm. On appeal, insurer claims it has no duty to defend the law firm because of its “business enterprise” exclusion which provides that there’s no coverage for any claim arising out of “the alleged acts or omissions of any insured * * * for a business enterprise * * * in which any insured has a controlling interest.” Appellate court noted that the underlying complaint against the lawyer and the law firm for civil conspiracy involved allegations of the lawyer’s acts for a business enterprise in which the lawyer had a controlling interest. Appellate court found no duty to defend the law firm because the exclusion above precluded coverage for the law firm because the exclusion applied to all insureds based on the conduct of “any” one insured.

by Christopher J. Graham and Joseph P. Kelly

Eastwood Ranch, LP, et al v. Dyess, et al, Case No. G046526 (Cal. App. 4th Jan. 16, 2013) (unpublished)

California’s one-year statute of limitations barred plaintiffs’ legal malpractice claim. Plaintiffs discovered in 2007 that defendants didn’t include a significant provision in purchase option documents, but didn’t file suit until 2010. Court stated under California law (§ 340.6) “the limitations period is one year from actual or imputed discovery, or four years (whichever is sooner), unless tolling applies” and that the trigger for the one year limit is the client’s “discovery of ‘the facts constituting the wrongful act or omission,’ not by his discovery that such facts constitute professional negligence…” Plaintiffs discovered the facts constituting purported negligence in 2007 – three years before filing suit.

by Christopher J. Graham and Joseph P. Kelly

Kenco Enterprises Northwest, LLC v. Wiese, et al, Case No. 67351-3-I (Wn. App. Jan. 7, 2013)

Legal malpractice claim not assignable, directly or indirectly, to an adversary in a proceeding from which that legal malpractice is alleged to have arisen. This litigation arose out of an alleged breach under a real estate purchase and sale agreement and resulted in a $3 million judgment against counter-defendant who then assigned all its interest, including legal malpractice claims it might have against its attorneys to counter-plaintiff. Legal malpractice claim was not assignable because under Washington law “assignments between adversaries could give rise to potential conflicts of interest and could harm the legal profession by making lawyers reluctant to represent potentially judgment-proof clients.”

by Christopher J. Graham and Joseph P. Kelly

Osborne v. Keeney, Case Nos. 2010-SC-000397-DG, 2010-SC-000430-DG (Ky. Dec 20, 2012)

Kentucky Supreme Court reversed and remanded legal malpractice case because trial court failed to instruct the jury on the suit-within-a-suit standard which requires trial court to instruct the jury as if it were trying the underlying tort case before instructing the same jury on the legal malpractice claim. Plaintiff’s legal malpractice case was based on her attorney’s failure to file suit against a pilot that crashed his plane into her house. Court also held that punitive damages are recoverable from attorney for legal malpractice, but plaintiff can’t recover as damages the “lost” punitive damages that may have been recovered in “suit-within-a-suit.”

by Christopher J. Graham and Joseph P. Kelly

Encyclopedia Britannica, Inc. v. Dickstein Shapiro, LLP, Case No. 10-0454 (JDB) (D. D.C. Nov. 26, 2012)

Judicial estoppel didn’t preclude defendant law firm from making an argument that contradicts statements made during the firm’s representation of plaintiff in patent infringement suit. Law firm took position in malpractice suit that patents weren’t infringed. But one of the firm’s attorneys had earlier stated in an affidavit that “some of the claims are unquestionably infringed.” Court noted it would be improper to apply judicial estoppel to a non-party, like the attorney who made the initial statement. Even so, the court stated that it would be improper to apply judicial estoppel to statements “made in its prior capacity as the now-opposing party’s lawyer or representative.” Doing so could potentially limit the “full and vigorous representation” of legal clients because lawyers would have to choose between the client’s interest and preventing a future malpractice suit.

by Christopher J. Graham and Joseph P. Kelly

Scanlan v. Marshall Eisenberg, et al, Case No. 09 C 5026 (N.D. Ill Nov. 15, 2012)

Trust beneficiary sued law firm and lawyers for legal malpractice and breach of fiduciary duty. Defendants allegedly represented both the plaintiff beneficiary and the trustee; and caused the Trust to purchase stock and make loans for the benefits of others. Defendants unsuccessfully argued plaintiff didn’t allege an attorney-client relationship. While there was no express representation of plaintiff by defendants, plaintiff alleged an implied-in-fact contract through allegations regarding plaintiff’s interactions with defendants over the years, including numerous examples where defendants advised plaintiff on legal matters. Defendants also unsuccessfully argued the fiduciary duty count was duplicative of the legal malpractice count but the court allowed the fiduciary duty count to proceed because it was based on different conduct than alleged in the legal malpractice count.

by Christopher J. Graham and Joseph P. Kelly

Schmidt v. Coogan, 287 P.3d 681 (Wash. App. Oct. 30, 2012)

Defendant attorney granted new trial on damages in legal malpractice case. The legal malpractice plaintiff was injured in a slip and fall at a grocery store. Defendant attorney failed to file plaintiff’s suit against the grocery store within the statute of limitations. The attorney was found liable at trial and damages were awarded. Defendant attorney was granted a new trial on damages only because plaintiff failed to prove collectability. Plaintiff’s damages needed to be limited to what she could recover from the grocery store if defendant attorney timely filed suit. “Courts consider collectability of the underlying judgment to prevent the plaintiff from receiving a windfall because it would be inequitable for the plaintiff to be able to obtain a greater judgment against the attorney than the judgment that the plaintiff could have collected from the third party.”