Justia Professional Malpractice & Ethics Opinion Summaries

Tuzzolino and his law firm represented Coletta. Coletta alleged that, in litigation, Tuzzolino failed to timely disclose expert witnesses; failed to retain needed expert witnesses; advised Coletta to settle for an amount far less than Coletta’s losses; told Coletta that negotiations were continuing after dismissal; and signed settlement documents without informing Coletta. According to Coletta, Tuzzolino offered to pay $670,000 to settle any potential malpractice claim, but never paid. Three months later, shortly before the expiration of the firm’s 2007-08 malpractice policy with ISBA Mutual, Tuzzolino completed a renewal application. In response to: “Has any member of the firm become aware of a past or present circumstance(s), act(s), error(s) or omission(s), which may give rise to a claim that has not been reported?” Tuzzolino checked “no.” Mutual issued the policy. Tuzzolino’s partner, Terpinas, learned of Tuzzolino’s malfeasance a month later, when he received a lien letter from Coletta’s attorney. Terpinas reported the claim to Mutual, which sought rescission and other relief. The circuit court entered summary judgment against Tuzzolino and rescinded the policy, finding that Mutual had no duty to defend Terpinas or the firm against Coletta’s action. The appellate court reversed as to Terpinas, citing the common law “innocent insured doctrine.” The Illinois Supreme Court reinstated the rescission, citing 215 ILCS 5/154, which allows rescission in cases involving misrepresentations “made by the insured or in his behalf,” with an actual intent to deceive or that “materially affect the acceptance of the risk or hazard assumed by the insurer.” View "Ill. State Bar Ass'n Mut. Ins. Co. v. Law Office of Tuzzolino & Terpinas" on Justia Law

Guam attorney Lujan was sued in two lawsuits in Hawaii, followed by another in California, which could have cost him millions of dollars, loss of reputation, and possibly his license to practice law. He hired a law firm with offices in San Francisco and Guam to represent him, which included filing two more proceedings. The representation generated significant billings about which Lujan complained, refusing to pay a large balance. The firm withdrew from the representation, and sued. A jury returned a verdict for the firm of $945,947.90 “together with its disbursements and costs, including expert witness fees, in the amount of $_____, prevailing party attorneys’ fees as allowed by contract in the amount of $_____, and pre-judgment interest as allowed by contract in the amount of $_____.” The court later awarded $331,545.51 in prejudgment interest. The California Court of Appeal affirmed. The firm filed a memorandum of costs and a motion for attorney fees based on the engagement letter Lujan had signed. Following thousands of pages of briefing and oral argument, the trial court forwarded $1,532,674 in attorney fees, and $123,227 in expert witness fees, based on a Code of Civil Procedure section 998 offer. The court of appeal affirmed. View "Calvo, Fisher & Jacob v. Lujan" on Justia Law

Plaintiffs filed an amended petition against two attorneys who prepared documents in connection with the sale of real and personal property, alleging that Defendants negligently performed legal services in negotiating, drafting, and providing legal advice in connection with the documents. The district court granted Defendants’ motion for summary judgment on statute of limitations grounds. The Supreme Court reversed, holding that summary judgment should not have been granted in favor of either attorney because (1) with regard to the first attorney, the district court identified the incorrect date at which Plaintiffs suffered actual damage; and (2) with regard to the second attorney, a fact question remained for trial. View "Vossoughi v. Polaschek" on Justia Law

Spencer stopped paying her mortgage in 2008. In Wisconsin state court foreclosure proceedings, Spencer’s attorney, Nora, adopted an “object-to-everything litigation strategy and buried the state court in a blizzard of motions.” While a hearing on a summary judgment motion was pending in state court, Nora removed the case to federal court. Finding no objectively reasonable basis for removal, the district court remanded the case and awarded attorney’s fees and costs to the lender, 28 U.S.C. 1447(c). The Seventh Circuit dismissed Spencer’s appeal as frivolous; the district court did not order her to pay anything. The court affirmed the award as to Spencer “because she has not offered even a colorable argument that removal was reasonable” and ordered Nora to show cause why she should not be sanctioned for litigating a frivolous appeal. Several months later, noting Nora’s similar behavior in another case, the court imposed an increased sanction of $2,500, suspended until the time, if ever, that Nora submits further inappropriate filings, and directed the clerk of court to forward a copy of the order and earlier opinion to the Office of Lawyer Regulation of the Wisconsin Supreme Court. View "PNC Bank v. Spencer" on Justia Law

HSBC initiated a Wisconsin foreclosure action on the Rinaldi’s mortgage. The Rinaldis counterclaimed, alleging that the mortgage paperwork had been fraudulently altered and that HSBC lacked standing to enforce the mortgage. The Rinaldis lost at summary judgment and did not appeal. The court later vacated its foreclosure judgment after HSBC agreed to modify the loan. The Rinaldis filed a new state lawsuit reasserting their counterclaims. Before the court ruled on the defendants’ motion to dismiss, the Rinaldis filed for bankruptcy. In those proceedings, HSBC filed a proof of claim for the mortgage. The Rinaldis objected and filed adversary claims, alleging fraud, abuse of process, tortious interference, breach of contract, and violations of RICO and the Fair Debt Collection Practices Act. The bankruptcy court found in favor of HSBC and recommended denial of the adversarial claims. The district court agreed, noting the Rinaldis’ failure to comply with Federal Rules. The court dismissed the Rinaldis’ adversary claims as meritless and warned that the Rinaldis would face sanctions if they filed additional frivolous filings because their tactics had “vexatious and time- and resource-consuming” and their filings “nigh-unintelligible.” After additional filings of the same type, the Rinaldis voluntarily dismissed their bankruptcy. Their attorney filed additional frivolous motions. The court ordered the attorney to pay $1,000. The Seventh Circuit upheld the sanction. View "Nora v. HSBC Bank USA, N.A." on Justia Law

Anten and the Rubins jointly retained Gelfand and Kirios of the Weintraub law firm to advise and represent them on a matter of common interest: incorrect advice given by their prior tax attorneys. Anten filed a malpractice action against those lawyers concerning that representation. In response to discovery propounded by Anten, the lawyers objected that Anten’s discovery sought communications between the lawyers and the Rubins that were protected by the attorney-client privilege, which the Rubins expressly declined to waive. The superior court denied a motion to compel further responses, on the basis of the attorney-client privilege objection. The court of appeal granted Anten writ relief. In a lawsuit between the attorney and one or more of the attorney’s joint clients, based on an alleged breach of a duty arising from the attorney-client relationship, relevant communications between the attorney and any of the joint clients, made in the course of the attorney-joint-client relationship, are not privileged. View "Anten v. Super. Court" on Justia Law

Husband and wife Walter and A.K. Lienhart Minnick sued the law firm Hawley Troxell Ennis and Hawley, LLP (Hawley Troxell), alleging negligence in rendering services in connection with a real estate development project. On motion of Hawley Troxell for summary judgment, the district court dismissed the action as time-barred under the applicable statute of limitations. On appeal, the Minnicks argued that the district court erred in calculating accrual of their action under the statute, Idaho Code section 5-219(4). After review, the Supreme Court agreed, reversed the trial court's judgment, and remanded the case for further proceedings. View "Minnick v. Hawley Troxell Ennis" on Justia Law

In 1999, Christeson was convicted of three counts of capital murder and sentenced to death. The Missouri Supreme Court affirmed Christeson’s conviction and sentence and denial of his post-conviction motion for relief. Under the one-year limitations period imposed by the Antiterrorism and Effective Death Penalty Act, 28 U. S. C. 244(d)(1), Christeson’s federal habeas petition was due on April 10, 2005. Nine months before that deadline, the court appointed attorneys Horwitz and Butts to represent Christeson, 18 U. S. C. 599(a)(2). The attorneys subsequently acknowledged that they failed to meet with Christeson until six weeks after his petition was due. There is no evidence that they communicated with him at all. They finally filed the petition 117 days late. The district court dismissed; the Eighth Circuit denied a certificate of appealability. Christeson, who has severe cognitive disabilities, relied entirely on his attorneys, and may not have known of the dismissal. About seven years later, the attorneys contacted attorneys Merrigan and Perkovich to discuss Christeson’s case. Christeson’s only hope for merits review was to move under FRCP60(b) to reopen final judgment on the ground that AEDPA’s statute of limitations should have been equitably tolled. Horwitz and Butts would not file that motion, premised on their own malfeasance. In 2014, Merrigan and Perkovich unsuccessfully moved to substitute counsel. The Eighth Circuit dismissed, reasoning that they were not authorized to file on Christeson’s behalf. The Missouri Supreme Court set an October 29, 2014 execution date. The district court denied a second motion as untimely, stating that Horwitz and Butts had not “abandoned” Christeson, and reasoning that allowing the motion would permit “‘abusive’” delays in capital cases. The Eighth Circuit affirmed. The Supreme Court stayed execution and reversed, stating that the denials contravened its 2012 decision, Martel v. Clair, concerning the “interests of justice” standard, and noting the obvious conflict of interest with respect to the original attorneys. View "Christeson v. Roper" on Justia Law

In 2005, NeuroRepair retained Nath Law Group for prosecution of patent applications. NeuroRepair became dissatisfied and requested that Nath transfer its files to another law firm to continue prosecution before the USPTO. Nath withdrew from representation of NeuroRepair before the USPTO, but continued to assist NeuroRepair with other matters. NeuroRepair filed suit in 2009, alleging professional negligence, breach of fiduciary duty, breach of written contract, breach of oral contract, breach of implied covenant of good faith and fair dealing, negligent misrepresentation, and false promise. Nath removed the case to federal court on the ground that it was “a civil action relating to patents.” After judgment in Nath’s favor in 2012, NeuroRepair appealed, challenging the court’s subject matter jurisdiction in light of the Supreme Court’s 2013 pronouncement in Gunn v. Minto. The Federal Circuit vacated, with instructions to remand to California state court; no federal issue is necessarily raised, because any federal issues raised are not substantial in the relevant sense. Federal court resolution of malpractice claims that do not raise substantial issues of federal law would usurp the important role of state courts in regulating the practice of law within their boundaries, disrupting the federal-state balance approved by Congress. View "NeoroRepair, Inc. v. Nath Law Grp." on Justia Law

The issue this case presented for the Supreme Court's review was one of res judicata, and whether the preclusive effect of a fee proceeding in bankruptcy court on a later lawsuit for legal malpractice allegedly committed in the course of the bankruptcy. After review, the Court held that the elements of res judicata were met and that Petitioner was sufficiently aware of his malpractice claim, which he could and should have brought in the bankruptcy proceeding. The Court affirmed dismissal of Petitioner’s subsequent malpractice suit but emphasized that barring a claim on res judicata grounds requires a determination that the claimant had a full and fair opportunity to litigate the claim in the earlier proceeding. View "Potter v. Pierce" on Justia Law