Legal Malpractice: What is it?
Legal malpractice refers to a situation in which a client has suffered from harm as a result of the error or negligence of their attorney. In the United States, legal malpractice is similar to either negligence or breach of contract. When an attorney breaches their specialized duty, this is considered a legal malpractice claim. Many legal malpractice cases center around the attorney’s failure to act in accordance with the law.
Attorneys are bound to follow the ethical laws of the State of California and represent the clients in a competent and skillful manner. Although there is no one single event that constitutes legal malpractice, there are many instances that can result in legal malpractice. An attorney may be guilty of legal malpractice if they:
Negligently represent a client in a personal injury case
Negligently advise a client about a business transaction
Negligently represent a client in a real estate transaction
Negligently handle a real estate foreclosure
Negligently abandon a case
Negligently represent a client in a criminal proceeding
Fail to file the appropriate documents in a timely manner
Negligently handle a will or estate
Negligently promise a client that he has a winning case
Negligently negotiate a settlement for a client by misrepresenting that a matter had been settled
Negligently have a conflict of interest
Negligently fail to advise about opportunities to settle a case
Negligently fail to keep a client informed of the status of their case
Negligently understaff a complex case
Negligently fail to include or advise regarding insurance coverage
Negligently settle a case without a clients consent
Negligently advise a client not to take a settlement
Negligently advise a corporate client to enter into a shareholders agreement
Negligently fail to issue a policy , cancel a policy, or breach a policy of insurance
Negligently fail to include a claim in an insurance policy
Negligently fail to understand the scope of its authority
Negligently fail to make a proper record on appeal
Negligently breach an engagement agreement
Negligently fail to file a lien
Negligently mislead a client about a statute of limitations
Negligently fail to advise a client as to the appropriate statute of limitations
Negligently misrepresent a client’s rights
Negligently fail to properly assist a client in dealing with an agency such as the IRS
Negligently fail to advise how long a case may take
Negligently inaccurately value a case
Negligently fail to offer an alternative dispute resolution
Negligently uderstaff a bankruptcy case
Negligently fail to assist a client in understanding a complex case
Negligently fail to take on or refuse to take on a difficult case
Statute of Limitations on Legal Malpractice in California
California’s Statute of Limitations for Legal Malpractice is two years in California, and three for claims where the underling case was in Federal Court. (Some legal malpractices are even subject to a 4 year statute of limitations.)
There is an exception for clients who were legally blind, mentally incompetent or children. In such instances, the statute of limitations does not begin to run until the time that the person is no longer affected by their impairment.
The general rule is that the statute begins to run upon damage and discovery, which is to say at the time of loss in the underlying case and discovery of that loss. Time is a big factor, and issue of dispute are the facts of running the statute as applied to the placement of that clock.
Here is how the statute of limitations works in California:
- You have to file your claim within 2 years of the date the malpractice occurred.
- If you can’t file it by the 2-year mark due to circumstances beyond your control (e.g., mental illness, wrongful death of the attorney, etc.), you can file an extension within a "reasonable" period of time.
- On the other hand, a person’s status as a minor prevents the statute of limitations from expiring before his or her 18th birthday. Thus, a person 17 years or younger can file a legal malpractice claim any time before he or she turns 19.
The Application of Tolling and Exceptions to the Statute of Limitations
In some instances, the time period within which an action must be brought may be extended or tolled both by statute and at common law. For example, Code of Civil Procedure section 352 provides that when plaintiff is out of California, the time limit is extended for the period of time they were absent. Code of Civil Procedure section 356 provides that when a contract is made outside of California, an action based on the contract may be commenced no more than four months after the contract is performed in California.
At common law, whether intentional or negligent conduct results in fraud or concealment of the identity of a wrongdoer tolls the statute of limitations. In Kline v. Turner (1982) 28 Cal.3d 64, plaintiff suffered personal injuries in 1967. Plaintiff retained his attorney who negotiated a settlement in 1971. In 1975, plaintiff discovered that the attorney had settled the case for only a small sum, rather than the full $50,000 policy limit. The Court ruled that the statute of limitations was tolled during the four years until plaintiff discovered the wrongdoing. The Court stated: "[a] defendant’s fraudulent concealation of the fact that plaintiff has a cause of action against him tolls the statute of limitations until plaintiff discovers the existence of the cause of action . . . Code of Civil Procedure section 340, subdivision (3) (fraud) is tolled until discovery of fraud" Id. at 79.
Some courts have concluded that fraudulent concealation by an attorney after employment does not toll the statute. In Ronald W. v. Grynberg (2008) 165 Cal.App.4th 1418, the plaintiff engaged an attorney in a suit against the company which manufactured and sold desitroamphetamine tablets that contained and incorporated a possibly cancerous "deforming agent." The attorney worked on the case for more than 2 years and in the 3rd year advised neither plaintiff nor any member of his family to have any treatments or tests done regarding the possibility of cancer caused by the drug. Plaintiff was diagnosed with cancer in the fourth year and brought suit against the attorney when he learned, four years after the accident, that he might be eligible for a large settlement. The Court ruled that the statute of limitations could not be tolled with respect to a third party, even though the attorney’s failure to advise the plaintiff properly about the need for medical examination and treatment constituted actionable misconduct. Court stated that "Attorney’s breach of his duty to plaintiff by failing to inform him of his options with respect to the tort claim was over by the time plaintiff and his family learned of the facts giving rise to their cause of action." Id. at 1427.
Therefore, the statute of limitations will still bar a claim for legal malpractice even when there are less-than-admirable events with the original defendants or the attorney, provided that those events post-date the original representation.
Missed the Statute of Limitations: Now What?
The consequences of a plaintiff filing a legal malpractice lawsuit after the expiration of the statute of limitations are serious. A plaintiff’s case may be dismissed. The defendant attorney’s right to file a cross-complaint may be lost. Prejudgment interest may be lost. Attorney’s fees may be lost.
Generally, whatever right to which a party is entitled will be lost if it is not exercised within the time set by the Code of Civil Procedure. Any actions which would otherwise serve as an estoppel will not be available if the right is not exercised within the time required. A defendant in an action upon a claim upon which an action might have been commenced against the defendant upon an earlier date shall be barred to plead the statute of limitations unless the defendant was unaware of the claim during the period when an action might have been commenced.
In Davis & Cox v. Summa Corp.,165 Cal.App.3d 491 (1985), a law firm filed a legal malpractice action against an attorney for negligence in an underlying contract dispute. Specifically, the firm alleged that the defendant attorney failed to name two necessary parties in the underlying action, which resulted in the entry of a judgment dismissing the action "with prejudice." The California Court of Appeal reversed the lower court’s sustaining of a demurrer on the grounds of running of the statute of limitations by the defendant attorney. The Court of Appeal held that the firm’s complaint was not time-barred because the defendant attorney’s acts had led to the complete dismissal of the underlying claim, and not the entry of judgment.
In Bratt v. Superior Court, 70 Cal App 3d 215, 136 Cal Rptr 8 (1977), the action was filed on June 11, 1976, in regard to a 1974 contract for the purchase of real property. The lower court dismissed the action on several grounds, one of which was that the action was barred under the statute of limitations as the "inquiry notice" had been given in 1974 and an action should have been commenced at that time. However, the appellate court held that there were good reasons for delaying bringing the suit, and that equity would prevent an unbending application of the statutes of limitation. Thus, even though the interest in a finality of the transaction favored application of the statute of limitations, the court found that this interest is exceeded by the hardship of the defendants in this case.
In Bagg v. Rogers & Wells, 23 F. Supp. 2d 1093 (N.D. Cal. 1998), the plaintiff had five years in which to file an action because the conflict issue was not apparent until the plaintiffs commenced the first action. When the plaintiff filed the action, they failed to make a showing of continuing concealment which would have tolled the statute. The Amended Complaint also failed to allege any independently tortious acts. This case clearly holds that the continuing violation doctrine does not adequately state an action for legal malpractice. Thus, one cannot maintain a legal malpractice claim if the opposing party has failed to answer the complaint, nor can the estate maintain a legal malpractice claim. Similarly, a client cannot maintain an action for failure to answer.
How to Bring a Legal Malpractice Action
The initiation of a legal malpractice cause of action requires careful research and complete knowledge of the facts, and all parties involved. In California for example, it is prescribed that the statute of limitations, in most instances is 1 year. This means that any legal malpractice action must be initiated within one year of the actual legal malpractice. Note that the date of discovery is crucial and in some cases, will result in the tolling of the statute of limitations for a short period. It is at this point in time, that a duty to gather evidence begins . Malpractice attorneys are duty bound to keep themselves updated on the law. If they do not, they could be liable for malpractice themselves. Once it has been established that malpractice occurred, the current malpractice attorney should analyze the previous action in order to evaluate damages. If the previous attorney performed a negligent act, and that act caused injury, damages must be ascertained. It is critical to the success of the malpractice action to be able to prove both negligence and damages.
Tips on Retaining an Experienced Legal Malpractice Attorney
Once you have established that the time to bring your case has not expired, you must still find a qualified legal malpractice attorney to help you. In California, it is very important to ensure that you are hiring a legal malpractice attorney who is experienced in legal malpractice cases. You should ask how many cases he or she has tried before a judge and what percentage of those were legal malpractice cases. You should also ask how many of those cases involved attorneys in the same area of law as the area in which your attorney was representing you.
For example:
You contracted with a personal injury firm to represent you and your family. Your case was handled by one particular attorney who failed to pursue the case for more than a year, only to ultimately settle the case for an amount that was well below what it was worth. Behind your back, your "attorney" had given up and "sold" your case for a pittance that would only lead to more of the same treatment by other lawyers in the coming years. Years after your case settled, you learned what had really happened. Time is running out and now you have to find a lawyer to handle the legal malpractice action. This attorney will not be as experienced as an attorney specializing in legal malpractice cases but he or she may not have the burden of proof that your own attorney neglected our case because the applicant was not subject to the usual standard of care based on lack of license. The attorney will have to show that the claim for injury against the prior attorney is either a tort or a contract action. He or she can also point out the error in the law of the ill-formed statute of limitation and that the two are no longer applicable. The attorney or law firm will have to prove up your damages as well but you should be able to do that for him or her. You will have to help each other and that is often what happens when an attorney is hired for legal malpractice. He or she may even point out how his or her firm can help with the damages and then accept the case.
Commonly Asked Questions About Legal Malpractice
What is legal malpractice?
Legal malpractice occurs when legal counsel acts in a way that is negligent, and results in harm to their client. Legal malpractice cases tend to be based more on negligence rather than intentional action.
Can you file a legal malpractice case without first filing the underlying case?
You cannot file for legal malpractice if the underlying case did not exist. Therefore, if a client believes that their attorney made a mistake in handling the underlying case, and as a result the client lost, they should establish the merits of the underlying case, and then they can pursue legal malpractic .
Do legal malpractice cases in California have a statute of limitations?
Yes. If you are pursuing an attorney for legal malpractice in California, then you have one year from the date you discovered the legal malpractice or you have four years to file. If you are looking to file for attorneys fees as well, and you are relying on your legal malpractice action to assert your claim, then you will have four years. In any event, your case should be filed within a reasonable amount of time.
