D. Defenses

• Library: Elements of Civil Causes of Action (SCBar) (2021 Ed.)

D. Defenses

Since the defendant in a legal malpractice action is by definition a lawyer, it is not surprising to find that creative defendants and their counsel have argued a considerable number of defenses. These include: comparative negligence; assumption of the risk; lack of privity;⁴⁶ statute of limitations; laches; prematurity and abatement; availability of another remedy; release and disclaimer;⁴⁷ waiver and ratification; compromise/settlement with a third party; res judicata; collateral estoppel; equitable estoppel;⁴⁸ immunity; misconduct in the underlying transaction; indemnity and contribution; unjust enrichment; and, mitigation of damages.⁴⁹

Contributory negligence is a defense in any negligence action that requires the defendant show the plaintiff was negligent⁵⁰ and that the negligence was the proximate cause of the injuries.⁵¹ Traditionally, contributory negligence was a total defense to the cause of action; however, South Carolina has adopted comparative negligence under which the plaintiff may recover if his or her negligence is not greater than the defendant's in which case the plaintiff's recovery is reduced in proportion to his or her negligence.⁵² Punitive damages, however, are not reduced by the proportion of the plaintiff's negligence under comparative negligence.⁵³ Nearly every court that has considered the defense of contributory/comparative negligence in the context of legal malpractice actions has determined it should be available.⁵⁴ Comparative negligence in a legal malpractice action might be based on: failure by the client to supervise, review or inquire concerning the subject of the representation; failure to follow the attorney's advice or instructions; failure to provide essential information; active interference by the client with the representation; failure to complete certain responsibilities regarding the subject matter; and, failure to pursue remedies to avoid or mitigate the effect of the lawyer's negligence.⁵⁵

Assumption of the risk is a defense to negligence that is recognized in South Carolina in two forms: express assumption and implied assumption.⁵⁶ Express assumption derives from an agreement to waive liability, whereas implied assumption applies where the plaintiff voluntarily encounters a risk, understands and appreciates the nature and extent of a known danger created by the defendant, indicates a willingness to accept it, and freely and willingly exposes him or herself to it.⁵⁷ A plaintiff is not barred from recovery by an implied assumption of the risk unless the degree of fault is greater than the negligence of the defendant.⁵⁸ One difficulty with an assumption of the risk defense in a legal malpractice action is that lay people do not always understand the law or the legal import of their actions.⁵⁹ Nonetheless, the court in Mali v. Odom,⁶⁰ acknowledged that assumption of the risk may be raised as a defense in a legal malpractice case. In Mali the plaintiffs contracted to purchase four lots and a house intending to use the property for a school. Two of the lots, however, were restricted to residential use. The attorney who handled the closing and examined the title knew of the intended use. After the closing, the plaintiffs attempted to convert the house into a school, but were blocked when adjoining landowners brought an action to enforce the restrictive covenants. The South Carolina Supreme Court eventually allowed one lot to be used for the school. The plaintiffs sued the attorney who argued the plaintiffs assumed the risk involved in closing the transaction since he advised them of the restrictive covenants and they decided to purchase the property anyway. The Court of Appeals held that the question of assumption of risk clearly constituted a jury question because a factual dispute existed about whether the attorney advised the plaintiffs about the restrictions at any time prior to closing.

The applicable statute of limitations is three years for actions arising on or after April 5, 1988, and six years for those arising before that date.⁶¹ The discovery rule is applicable.⁶² The South Carolina Supreme Court applied the rule to a legal malpractice action in Mills v. Killian,⁶³ where the court said the modern trend in professional negligence or malpractice cases is that accrual is on discovery by the injured party and that this represents the "more equitable and rational view." Another legal malpractice case discussing the discovery rule is Peterson v. Richland County⁶⁴ where the court said the discovery rule focuses on whether the complaining party acquired knowledge of any existing facts sufficient to put him or her on inquiry. Knowledge of injury does not, a fortiori, give rise to suspicion of impropriety. The limitations period is, instead, triggered by knowledge of facts sufficient to put the injured person on notice that an action may exist. In Stokes-Craven Holding Corp. v. McKenzie,⁶⁵ the South Carolina Supreme Court reviewed a case in which a legal malpractice cause of action was predicated on an injury or damage caused by the failure of an underlying suit because of an attorney's alleged malpractice. In that scenario, said the court, there can be no cause of action without an adverse verdict, judgment, or ruling and if the client appeals the matter in which the alleged malpractice occurred, any basis for the malpractice cause of action is stayed while the appeal is pending. Thus, until the appeal is resolved against the client, there is no legally cognizable cause of action for alleged malpractice. On resolution of the appeal, a cause of action for legal malpractice accrues and triggers the statute of...