Vermont Bar Journal, Vol. 40, No. 2 - Page 12

Ruminations
action . The court held that the judgmental immunity doctrine protects attorneys when they speculate on unsettled areas of the law , provided they have informed the client of the risks . 29
Attorneys who are employees of the state enjoy special protections through sovereign immunity . The protection is limited to employees of the state . One lawyer , acting under contract to the Defender General , found that because he was not a state employee , he could not claim immunity . He was an independent contractor , unsupervised by the Defender General , and that made a difference . 30
Statute of Limitations
Legal malpractice claims are generally governed by the six-year statute of limitations . That deadline is tolled until the plaintiff has enough information to put a reasonable person on notice that the lawyer is liable for the client ’ s injuries . Lawyers who promoted an “ exhaustion of appeals ” approach , asserting that the period would not begin until the appeals process was concluded in the underlying action , were disappointed in the denial of their attempted creativity . 31 The equitable principle of laches does not apply to legal malpractice claims . The court will use the statute to determine deadlines . 32
Claims of mental anguish , emotional distress , and personal humiliation , have a three-year statute of limitations , as injuries to a person . 33 Since 1989 , emotional damages are only authorized if there is some physical effect , some bodily hurt , in order to prevail . 34 In a recent decision by the Superior Court , the trial judge refused to apply the continuous representation rule that would toll the statute of limitations on plaintiffs ’ emotional distress claim even though the attorney and client relationship continued . 35
Contract and Negligence
Most cases of legal malpractice had been brought as breach of contract claims , until the high court decided in 2006 that these claims are more properly negligence claims . Contract claims fail when they are not in writing , and breach requires some proof of a special promise . The negligence standard is different . Proving negligence for malpractice requires proof that an attorney-client relationship exists , that a duty exists , and that the breach of that duty is the proximate cause of the damages claimed . 36
This is illustrated by a case where a lawyer failed to timely identify and levy upon assets to collect a judgment before the statute made the judgment uncollectable . There was no question of the breach
of duty , but because no attachable assets existed , there was no compensable negligence in failing to search for or attempt to foreclose on them to collect on a judgment . The negligence was not the proximate cause of the injury in that case . 37
Often the court applies a “ cause-in-fact ” test for legal malpractice , delving into the merits of the underlying case that gave rise to the claim . The negligence of an attorney , even if proven , when it would not have made any difference to the outcome , escapes liability . In Knott v . Pratt ( 1992 ), the court looked at the decision to deny a claim against an estate that was untimely filed ( the malpractice ) finding that equity and good conscience justified the estate retaining its value , as the plaintiff had taken care of her father as an act of love , with no expectation of compensation . 38
Expert and Other Evidence
The necessity for expert evidence in legal malpractice cases is an evolving concept . The general rule still holds : if the alleged negligence is so obvious , so clear , that anyone could tell it was malpractice , based on common knowledge and experience , then no experts are needed . Increasingly , however , the bar seems to have been raised to require their testimony if the case is to continue to trial . More and more cases have been dismissed when plaintiffs fail to offer experts in cases where the wrongs aren ’ t so obvious . 39
Sometimes even when expert testimony is offered it falls short . An expert who concluded that an attorney ’ s failure to establish jurisdiction in federal court ( the report is unclear precisely what that meant ) was negligence , “ assuming the court had jurisdiction ,” had failed to establish a standard of care through his testimony . 40 Standard of care is now defined as performance measured by what a competent attorney would have done in the jurisdiction ( Vermont ), not in the community where the office is located . This was the ruling in Russo v . Griffin ( 1986 ). In dissent , Justice Hayes argued the court should cleave to a national standard . 41
Judge Helen Toor illustrated the kind of behavior that can be proven without experts in a 2015 malpractice decision . She wrote : The sort of case that does not require expert testimony might be , for example , one where the architect forgot to put in a staircase to get between the two floors of a house . There , the problem resulting from the error would be obvious to anyone . This is also not like Nicholson , where the Court found that a lawyer ’ s failure to disclose information obtained in a title search was a simple enough issue to be decided
without an expert . This , in contrast , was an incredibly complicated divorce case , generating the longest divorce ruling the undersigned has ever seen from any judge . Felis ’ s claim that it would be easy for a layperson to determine how Judge Pearson would have ruled had Langrock acted differently on various motions and in the final ruling is almost laughable . Without the missing expert testimony , Felis cannot prove his malpractice claim .” 42 In another malpractice case , the trial court ruled Vermont Rule of Evidence 408 does not prohibit admission of evidence of a failure to negotiate , even as it forbids offers of compromise or other details of a mediation . 43
Duty
Even where there may have been negligence amounting to legal malpractice , to make a claim the plaintiff has to have been owed a duty by the attorney . A bad deed , for instance , drafted by an attorney for the husband in a divorce , is not a compensable act of negligence that the ex-wife — not a client of the drafter — could claim . 44 In another example , the attorney for a corporation who was alleged to have failed to advise his corporate client to pursue bad faith claims against its insurer or to purchase additional insurance , who was also accused of filing meritless suits , was sued for legal malpractice by a shareholder . The court dismissed the claim after concluding there was no privity between the lawyer and the corporation ’ s stockholders . 45 There is also no privity between shareholders for damages caused by an attorney ’ s defective title search , based on immunities established in the Vermont Business Corporation Act . 46
When looking at duty , the relationship between the attorneys and the plaintiffs must be examined . A municipal attorney owes a fiduciary duty to the municipality , not individual elective or appointive officials . A city manager cannot claim malpractice when he isn ’ t the client or the privilege of confidentiality . 47 Legal malpractice claims may not be assigned to another , based on the fiduciary duties of an attorney . 48
An attorney may have committed fraud , but this is not compensable behavior if the plaintiff was not affected by his actions . This was the ruling in Marshall v . Joy ( 1857 ), where the attorney secretly encouraged a third party to benefit from a claim properly belonging to his client , reducing the possible award by half . The court concluded he had no right to retain the funds , but denied recovery to a creditor of the client who sued for the full amount , as the creditor was not directly affected by the attorney ’ s dishonesty . 49
12 THE VERMONT BAR JOURNAL • SUMMER 2016 www . vtbar . org
Ruminations action. The court held that the judgmental immunity doctrine protects attorneys when they speculate on unsettled areas of the law, provided they have informed the client of the risks.29 Attorneys who are employees of the state enjoy special protections through sovereign immunity. The protection is limited to employees of the state. One lawyer, acting under contract to the Defender General, found that because he was not a state employee, he could not claim immunity. He was an independent contractor, unsupervised by the Defender General, and that made a difference.30 Statute of Limitations Legal malpractice claims are generally governed by the six-year statute of limitations. That deadline is tolled until the plaintiff has enough information to put a reasonable person on notice that the lawyer is liable for the client’s injuries. Lawyers who promoted an “exhaustion of appeals” approach, asserting that the period would not begin until the appeals process was concluded in the underlying action, were disappointed in the denial of their attempted creativity.31 The equitable principle of laches does not apply to legal malpractice claims. The court will use the statute to determine deadlines.32 Claims of mental anguish, emotional distress, and personal humiliation, have a three-year statute of limitations, as injuries to a person.33 Since 1989, emotional damages are only authorized if there is some physical effect, some bodily hurt, in order to prevail.34 In a recent decision by the Superior Court, the trial judge refused to apply the continuous representation rule that would toll the statute of limitations on plaintiffs’ emotional distress claim even though the attorney and client relationship continued.35 Contract and Negligence Most cases of legal malpractice had been brought as breach of contract claims, until the high court decided in 2006 that these claims are more properly negligence claims. Contract claims fail when they are not in writing, and breach requires some proof of a special promise. The negligence standard is different. Proving negligence for malpractice requires proof that an attorney-client relationship exists, that a duty exists, and that the breach of that duty is the proximate cause of the damages claimed.36 This is illustrated by a case where a lawyer failed to timely identify and levy upon assets to collect a judgment before the statute made the judgment uncollectable. There was no question of the breach 12 of duty, but because no attachable assets existed, there was no compensable negligence in failing to search for or attempt to foreclose on them to collect on a judgment. The negligence was not the proximate cause of the injury in that case.37 Often the court applies a “cause-in-fact” test for legal malpractice, delving into the merits of the underlying case that gave rise to the claim. The negligence of an attorney, even if proven, when it would not have made any difference to the outcome, escapes liability. In Knott v. Pratt (1992), the court looked at the decision to deny a claim against an estate that was untimely filed (the malpractice) finding that equity and good conscience justified the estate retaining its value, as the plaintiff had taken care of her father as an act of love, with no expectation of compensation. 38 without an expert. This, in contrast, was an incredibly complicated divorce case, generating the longest divorce ruling the undersigned has ever seen from any judge. Felis’s claim that it would be easy for a layperson to determine how Judge Pearson would have ruled had Langrock acted differently on various motions and in the final ruling is almost laughable. Without the missing expert testimony, Felis cannot prove his malpractice claim.”42 In another malpractice case, the trial court ruled Vermont Rule of Evidence 408 does not prohibit admission of evidence of a failure to negotiate, even as it forbids offers of compromise or other details of a mediation.43 Expert and Other Evidence Even where there may have been negligence amounting to legal malpractice, to make a claim the plaintiff has to have been owed a duty by the attorney. A bad deed, for instance, drafted by an attorney for the husband in a divorce, is not a compensable act of negligence that the ex-wife—not a client of the drafter—could claim.44 In another example, the attorney for a corporation who was alleged to have failed to advise his corporate client to pursue bad faith claims against its insurer or to purchase additional insurance, who was also accused of filing meritless suits, was sued for legal malpractice by a shareholder. The court dismissed the claim after concluding there was no privity between the lawyer and the corporation’s stockholders.45 There is also no privity between shareholders for damages caused by an attorney’s defective title search, based on immunities established in the Vermont Business Corporation Act.46 When looking at duty, the relationship between the attorneys and the plaintiffs must be examined. A municipal attorney owes a fiduciary duty to the municipality, not individual elective or appointive officials. A city manager cannot claim malpractice when he isn’t the client or the privilege of confidentiality.47 Legal malpractice claims may not be assigned to another, based on the fiduciary duties of an attorney.48 An attorney may have committed fraud, but this is not compensable behavior if the plaintiff was not affected by his actions. This was the ruling in Marshall v. Joy (1857), where the attorney secretly encouraged a third party to benefit from a claim properly belonging to his client, reducing the possible award by half. The court concluded he had no right to retain the funds, but denied recovery to a creditor of the client who sued for the full amount, as the creditor was not directly affected by the attorney’s dishonesty.49 The necess ]H܈^\]Y[H[Y[X[XXH\\\[][ۘ\ H[\[[H[ΈYH[YYYY[H\؝[\X\][[ۙH[[]\X[XXK\Yۈ[[ۈۛYH[^\Y[K[^\\HYYY [ܙX\[K]\H\Y[\]HY[Z\Y\]Z\HZ\\[[۞HYH\B\۝[YHX[ [ܙH[[ܙH\\]HY[\Z\Y[Z[YZ[ٙ\^\[\\\HHܛۙ˜\[&]؝[\ˌBY][Y\][[^\\[[۞B\ٙ\Y][ܝ [^\ۘYY][]ܛ^x&\Z[\H\X\\\X[ۈ[Y\[\ H\ܝ\[X\X\[H]]YX[ H\›YY[K8'\[Z[H\Y\\X[ۋ8'HYZ[Y\X\H[\و\HY\\[[۞K [\ق\H\Y[Y\\ܛX[HYX\\YH]H\][]ܛ^H[]HۙH[H\\X[ۈ \[۝ K[H[][]H\HHٙXH\]Y \\H[[[\ܚY[ NN K[\[ \XH^Y\\YYH\[X]HH][ۘ[[\ BYH[[܈[\]YH[قZ][܈][Hݙ[]]^\[H MHX[XXHX\[ۋBܛNHܝو\H]\\]Z\B^\\[[۞HZYK܈^[\KۙH\HH\]Xܙœ][HZ\\H]]Y[BܜوH\K\KH؛[H\[[HH\܈[B؝[\[[ۙK\\[ZBXۋ\HH\[]H]Y\&\Z[\H\H[ܛX][ۈ؝Z[Y[H]HX\\B[\H[Y\YHHXYYHTSӕTTS8(SSQT M]B˝\ܙ‚