Torts Law.  A claim for legal malpractice is one designed to compensate the plaintiff harmed by the negligence of his or her attorney.

Elements of Legal Malpractice

The elements of legal malpractice are:

  1. A duty owed by the defendant attorney to the plaintiff to use such skill, prudence, and diligence as other members of the profession commonly possess and use;
  2. Breach of that duty;
  3. A proximate causal connection between the breach of duty and the resulting injury; and
  4. Actual loss or damage resulting from the defendant attorney’s negligence.

Element No. 1: Duty

A key element for any professional malpractice action is the establishment of a duty by the professional to the plaintiff.  Absent a duty, there can be no breach and no negligence.  The existence of a duty is a question of law for the court to decide.

In determining whether a duty of care should be created, the courts have repeatedly held that an attorney owes no duty of care to third parties involved with the attorney’s client.  As noted by a California court in Nicholas v. Keller, 15 Cal. App. 4th 1672 (1993), “[a]n attorney’s duty to his or her client depends on the existence of an attorney-client relationship.  If that relationship does not exist, the fiduciary duty to a client does not arise.”  Id. at 1684.

Courts have explained that, to make an attorney liable for negligent confidential advice not only to the client who enters into a transaction in reliance upon the advice but also to the other parties to the transaction with whom the client deals at arm’s length would inject undesirable self-protective reservations into the attorney’s counseling role.  The result would be both an undue burden on the profession and a diminution in the quality of the legal services received by the client.

There are only a handful of exceptions to the general rule that an attorney’s duty of care extends only to his or her clients.  In California, for instance, courts have permitted non-clients who are expressly named as beneficiaries in a final executed will or trust of the deceased client to bring malpractice claims against the attorney whose errors in drafting and/or execution of that will or trust resulted in the beneficiary being denied an express bequest made in that will or trust.  See Biakanja v. Irving, 49 Cal. 2d 647 (1958); Lucas v. Hamm, 56 Cal. 2d 583 (1961).

In addition to the issue of whether the attorney defendant owed a duty to the plaintiff, the first element of a legal malpractice claim also involves determining the scope of an attorney’s duty of care.

Generally, the duty imposed on an attorney is to exercise the degree of learning and skill that a reasonably careful attorney would have used in the same or similar circumstances.  Moreover, in matters involving legal specialties such as patent prosecution or patent litigation, the handling attorney has the duty to refer the matter to a legal specialist or, in the alternative, handle the matter with as much skill and care as that of a legal specialist in that particular filed.

Element No. 2: Breach of Duty

Generally, an attorney’s conduct falls below the standard of care, thereby breaching the duty the attorney owed to his client, only if his advice and actions were so legally deficient when given that it demonstrates a failure to use the skill, prudence, and diligence that a lawyer of ordinary skill and capacity would exercise in performing the tasks under the same or similar circumstances.  As a result, professional perfection is not required, and an attorney is not negligent simply because he or she errs in judgment or because his or her efforts prove unsuccessful.

In a legal malpractice action, negligence cannot be inferred from a bad result.  An attorney does not warrant success or the soundness of his or her legal product.  It is not reasonable to require an attorney to guarantee that the clients’ rights will never be questioned, nor is it reasonable to conclude that an attorney has committed malpractice simply because his or her judgment differs from that of a trial judge.  This is especially true given the fact that in virtually every lawsuit, there is disagreement concerning the law governing resolution of legal issues.  Attorneys, as advocates, argue their clients’ cause irrespective of whether they personally favor or believe the position adopted.

Element Nos. 3 and 4: Causation and Damages

Even if there is a breach of the standard of care, the plaintiff next must prove that the breach caused his or her damages.

Specifically, in order to establish the third element of a legal malpractice claim, the plaintiff must demonstrate using admissible evidence that he or she would have obtained a better result but for the alleged negligence.  This is generally done by a “trial within a trial” method and there are no accepted shortcuts.

Unless the plaintiff suffers damage (i.e., appreciable and actual harm) as a consequence of his attorney’s negligence, he cannot establish a cause of action for malpractice.  Breach of duty causing only speculative harm is insufficient to create such a cause of action.   Damages may not be based upon sheer speculation or surmise, and the mere possibility or even probability that damage will result from wrongful conduct does not render it actionable.

Moreover, the legal malpractice plaintiff has a particularly onerous burden where he or she chooses to settle the underlying matter before suing the attorneys.  Under such circumstances, plaintiff must prove to a legal certainty that, if not for the malpractice, he or she would have obtained more money in settlement, or would have achieved a more favorable judgment after a trial on the merits.

Following are examples of cases that highlight the uphill battle the plaintiffs generally face in establishing causation in legal malpractice actions:

In Thompson v. Halvonik, 36 Cal. App. 4th 657 (1995), for instance, Thompson, a minor, suffered brain injuries when he contracted an infection in the hospital shortly after birth.  Thompson’s mother retained attorney Halvonik to file suit against the hospital.  At the time, she was aware that another case was pending against the hospital by another infant, Booth, who contracted the same infection two weeks after Thompson.  The Booth case settled shortly after Halvonik was retained by Thompson’s mother.  Id. at 660.

Halvonik spoke with several of Thompson’s health care providers to obtain information necessary to answer discovery, but did not otherwise talk to the baby’s treating physicians, meet Thompson, arrange to film or videotape him or consult with neonatal or infectious disease experts.  Id.  He did not visit the hospital nursery, notice any depositions, or get the case set for trial.  Id.  More than a year and a half after his retention, Halvonik was substituted out of the case in favor of the Padway firm, which settled Thompson’s claims against the hospital for $1.7 million.  Id.

After the settlement, Thompson sued Halvonik, alleging generally that the attorney failed to act with reasonable care and diligence in prosecuting his case.  That delay, Thompson alleged, resulted in loss of value of his claim against the hospital and loss of use of the proceeds of the claim.  He further alleged that he incurred $25,000 in attorney’s fees and costs to the Padway firm for the additional expenses required to complete discovery and attempt to cure deficiencies in the state of the evidence and discovery created by Halvonik’s negligent delay.  Id.

The California court of appeal found that, even if Halvonik’s conduct fell below the standard of care, summary judgment in favor of Halvonik was proper because of the absence of evidence of damage resulting from any delay in prosecuting the action.  Id. at 661.  Specifically, the Court held:

None of [Thompson’s] evidence does more than suggest speculative harm, because it does not demonstrate that but for respondents’ delay, appellant’s underlying case would have settled at all, let alone at an earlier date, for the same amount, or with the same structure.  ‘Damage to be subject to a proper award must such as follows the act complained of as a legal certainty. . . .’  Even if appellant would have benefitted by receiving money for therapy and other care at an earlier date, absent evidence that [the hospital] would have settled with [Halvonik] under exactly the same circumstances it settled with the Padway firm, actual harm from respondents’ conduct is only a subject of surmise, given the myriad of variables that affect settlements of medical malpractice actions. ‘[T]he mere probability that a certain event would have happened, upon which a claim for damages is predicated, will not support the claim or furnish the foundation of an action for damages.’”  Id. at 663, citing Agnew v. Parks (1959) 172 Cal.App.2d 756, 768; Campbell v. Magana (1960) 184 Cal.App.2d 751, 758; Williams v. Wraxall (1995) 33 Cal.App.4th 120, 130-131.

Thus, Thompson stands for the proposition that causation, under such circumstances, cannot be shown to the requisite “legal certainty.”  Id. at 661, 663.

In Marshak v. Ballesteros, 72 Cal. App. 4th 1514 (1999), Marshak sued Ballesteros for alleged negligence in advising Marshak to settle a marital dissolution action for “less than the case was worth.”  Specifically, it was alleged that Ballesteros negligently urged the settlement, knowing that the marital residence was worth several hundred thousand dollars more than an appraisal had indicated.  Ballesteros moved for summary judgment based on there being no proximate causation beyond speculation and conjecture.  The motion was granted, and Marshak appealed.

In affirming the granting of summary judgment, the California court of appeal observed:

“In order to prevail in his legal malpractice action, plaintiff must prove that the dissolution action would have resulted in a better outcome had the defendant recommended that he reject the settlement offer.  Plaintiff must prove what that better result would have been. . . . ‘[T]he mere possibility that a certain event would have happened, upon which a claim for damages is predicated, will not support a claim or furnish the foundation of an action for such damages.  Damage to be subject to a proper award must be such as follows the act complained of as a legal certainty.’”  Id. at 1518, citing In re Easterbrook, supra, 200 Cal.App.3d at 1544.

In Barnard v. Langer, 109 Cal.App.4th 1453 (2003), Barnard claimed negligence by the attorney Langer in connection with an inverse condemnation proceeding, resulting in an inadequate settlement.  Barnard claimed that he was “forced to settle with the city for an amount substantially less than [he was entitled to].”  Id. at 1458.  The basis of the nonsuit was that Barnard’s damages were too speculative.  The trial court agreed.  The trial court’s ruling assumed that the defendant attorneys were negligent, and accepted Barnard’s trial brief and opening statement as an offer of proof on the issue of damages.  Having done so, the court observed, the difference between the amount Barnard received in settlement after deducting fees and costs ($680,000 plus $20,000 for the property) and the amount he reasonably could have recovered ($935,000) was $235,000.  The court then found that the risks of trial avoided by the settlement, plus the possibility that the trier of fact might not have accepted Barnard’s disputed valuations, were worth considerably more than $235,000.  Id.

Accordingly, Barnard had not met his causation burden.  As quoted by the court of appeal, the trial court cogently observed, noting the cost and wear and tear of a trial, that in order for Barnard to win, he “would have to show a significant difference, at a minimum, between what the settlement was and what he . . . would have gotten at trial.”  Id. at 1461.  Stated otherwise, the court observed, in a “settle and sue” case such as this one, the disgruntled client cannot prove his case without proof that the settlement was so “out of the ballpark” that the case should have been tried.  Id., citing Marshak, supra, 72 Cal.App.4th at 1519.  Consistent therewith, the Court of Appeal affirmed the judgment on the same reasoning of the trial court, affirming the strict rules for causation in legal malpractice cases.  Id. at 1461-1462.

The court then observed some of the reasoning for the palpable strictness of this rule:

“The hindsight vulnerability of lawyers is particularly acute where the challenge is to the attorney’s competence in settling the underlying case.  As a leading malpractice text observes, the amount of a compromise is often ‘an educated guess of the amount that can be recovered at trial and what the opponent was willing to pay or accept.  Even skillful and experienced negotiators do not know whether they received the maximum settlement or paid out the minimum acceptable.  Thus, the goal of a lawyer is to achieve a ‘reasonable’ settlement, a concept that involves a wide spectrum of considerations and broad discretion.  Theoretically, any settlement could be challenged as inadequate and the resolution is likely to require a trial. . . a claim regarding an inadequate settlement often fails because it is inherently speculative.  Negligence cannot be predicated on speculation that the attorney or another attorney could have secured a more advantageous settlement. . . .  A client, who was a plaintiff, must establish not only that concluding such a settlement fell outside the standard of care, but also what would have been a reasonable settlement and that such sums would have been agreed to and could have and would have been paid.’”  Id. at 1462, fn. 13, citing 4 Mallen, Legal Malpractice (5th ed. 2000) Error-Settlement, § 30.51, pp. 582-585.

In Slovensky v. Friedman, 142 Cal. App. 4th 1518 (2006), the court echoed the same sentiments as the Barnard court, observing that:

“In order [t]o win a legal malpractice action, the plaintiff must prove damages to a legal certainty, not a mere probability.  Thus, a plaintiff who alleges an inadequate settlement in the underlying action must prove that, if not for the malpractice, she would certainly have recovered more money in settlement or at trial.  Such claims are likely to be speculative, as even the most skillful attorneys can seldom know whether they obtained the best possible results; thus, they are held only to the standard of whether the settlement was within the realm of reasonableness.”  Id. at 1528. (Internal citations omitted.)  See also, Mattco Forge v. Arthur Young & Co. (1997) 52 Cal.App.4th 820, 834.

Finally, in Filbin v. Fitzgerald, 211 Cal. App. 4th 154 (2012), the Filbins owned a 2,000 acre parcel near an airport on California’s Central Coast.  The county initiated eminent domain proceedings.  Believing that the offer by the county was too low, the Filbins engaged Attorney Fitzgerald to represent their interests.  Fitzgerald obtained a much higher property appraisal, but the clients believed that the property was worth much more.  After the Filbins replaced Fitzgerald when the attorney client relationship had broken down, and during the course of trial, they accepted a $2.6 million offer from the county.  The Filbins then sued Fitzgerald for legal malpractice claiming he failed to properly prepare experts, failed to properly represent them, and abandoned them as trial approached.  The trial court concluded that the case should have settled for approximately $3.7 million, and therefore enter judgment against Fitzgerald for the $1.1 million difference between the two results.

The California court of appeal reversed the judgment, holding that, as a matter of law, Fitzgerald was not the cause of the Filbins’ damage.  It observed that a plaintiff is required to prove damages to a “legal certainty,” a difficult task in a “settle and sue case.”  Id., at 166-167.  The Court concluded that nothing Fitzgerald did or failed to do up to the time he departed as the Filbins’ counsel caused them any damages.  They secured new counsel and continued the trial date.  Thus, when replacement counsel took over the case, it was with “no lingering impairment” at Fitzgerald’s hands.  In short, the Filbins had failed to meet their burden of proximate causation beyond impermissible speculation, and failed to establish an actionable malpractice that caused the Filbins’ legal damage to a legal certainty.

Related entries