Ruminations, 16 VTBJ, Summer 2016-#10

AuthorPaul S. Gillies, Esq., J.


Vol. 42 No. 2 Pg. 10

Vermont Bar Journal

Summer, 2016

Paul S. Gillies, Esq., J.

Legal Malpractice in Vermont

An attorney defeated in the trial court is said to have two inalienable rights: (1) He may go down to the inn ..., or to his club in town, and cuss the court and/or jury; and (2) He can take an appeal.

Justice Thomas Hayes,

State v. Jewett (1985).1

Clients have the same rights, and one alternative. They can blame the lawyer, claiming that most disagreeable thing, namely, legal malpractice. It lurks behind every case, every client, ready to jump on us unexpectedly, and distract us from everything else that is good in life. Lawyers make mistakes. Sometimes they are tragic, sometimes negligent, sometimes negligible.

Beginning in 1824, there are a total of 38 reported cases that have reached the Vermont Supreme Court on appeal relating to legal malpractice, 27 of them resulting in a verdict for the lawyer affirmed on appeal. Of the 17 decisions issued in this century, 15 hold that no malpractice was proven. The available decisions of the trial courts, beginning in 2001, reveal another 40 decisions relating to this depressing subject. The numbers give no comfort. The experience of being accused by a former client, with the resulting trauma to the mind and reputation, can be the most distracting and career-altering experience. To some, the experience can be the last straw, where retirement or a new career seems more inviting than ever.

Only a handful of the reported cases reached a jury. Motions for summary judgment decided the majority of the claims, the plaintiff usually suffering dismissal because of evidentiary or procedural failures. By these cases, one might conclude that it is difficult to be held liable for legal malpractice.

The state's leading lawyers have been tried for legal malpractice, including Thomas Hutchinson, Isaac Cushman, Edward Barber, and E.J. Phelps, some of the greatest Vermont attorneys of the nineteenth century. Hutchinson later became Chief Judge of the Vermont Supreme Court. Former Justice Frank Mahady was also sued for malpractice before he was elevated to the trial bench. It is not a club anyone seeks to join and dismissal is no relief. Even when the charges are baseless, there is that suggestion of impropriety as the accused's professional competence becomes a public spectacle.

Malpractice is different from misconduct, as defined by and sanctioned by the Vermont Supreme Court. The remedy of malpractice is damages, where the sanctions of disbarment, suspension, reprimand, or admonishment are not involved. Just last year, the high court ruled that there can be legal malpractice without misconduct. For failing to reduce a contingent fee arrangement to writing, an attorney received the sanction of admonishment from the Supreme Court. The attorney had lost a malpractice suit brought against him by a former client, and was required to repay some or all of the fees he had received. The Court held that the fact that there had been an award of fees "would be considered neither aggravating nor mitigating" on the question of misconduct.[2] The Vermont Rules of Professional Conduct hold that "under general principles of tort law, violation of a rule is not, by itself, a basis for civil liability, and the rules are presumably admissible as evidence of the standard of care in a malpractice action."[3]

There also might be misconduct without malpractice. But those are defenses. Reviewing what the high court has said about malpractice can't be a wasted effort. The subject is best viewed objectively. Knowing what lawyers were accused of doing or not doing, even in cases where a court never reached a decision to punish the lawyer, underscores the ethical and practical challenges of surviving in this profession with dignity, or with at least some crude form of reputation intact.

There is a natural resistance to reading what others have done wrong, because it reminds us of our own vulnerabilities. What's worse, what constitutes legal malpractice is not always predictable. Vermont lawyers were admonished by Justice Hayes in State v. Jewett (1985) not to neglect the Vermont Constitution in arguing on behalf of their client's claims. The justice quoted Oregon Justice Hans Linde that such failures are "skating on the edge of malpractice."4 The opportunities for exposure are omnipresent.

What Lawyers Did or Were Said to Have Done

Lawyers are accused of malpractice for errors of both omission and commission. Failing to file an appeal is a common complaint, although such a failure is non-com-pensable if the case would have been lost on appeal anyway. That was the decision in Weisburgh v. Mahady (1986), where attorneys failed to timely file a defamation action against news media. This, the court concluded, is not attorney malpractice, as the news media enjoys a qualified privilege, so that the underlying tort was not actionable.5 As with other decisions, the court decided this case by applying a test that considers whether the negligence would have mattered, had the case actually been tried.

The earliest reported Vermont decision on malpractice was Crooker v. Hutchinson (1824). Titus Hutchinson failed his client by not pursuing the collection of a debt as far as the law would allow, including filing a writ of scire facias. This was a collection action against a man who provided bail to allow Charles Willard, the debtor, out of jail. Willard fled Vermont, Hutchinson was sued by the creditor, and was required to pay damages.[6]

In a more recent example, an attorney filed a motion for summary judgment on behalf of a client, but never filed a reply, or even an answer, affirmative defenses, or counterclaim. He recommended signing a stipulation that prevented the raising of additional defenses, without informing his client, who happened to be blind, of the consequences. He failed to provide defenses and keep his client informed. The client was awarded damages for the consequences of these failures, but on appeal the damages for emotional distress were stripped from the award, based on the general rule that disallows recovery in absence of either physical impact or substantial bodily injury or sickness.7

The attorney in another matter told the client he had filed a complaint in a defective automobile case, which wasn't true, and the statute of limitations ran on the claim. The client demanded payment, the attorney delayed, and then the client, who proceeded pro se against the lawyer, began filing repetitive and incomprehensible motions. Despite the attorney's initial wrongdoing, on appeal, the high court sanctioned the client for violating Rule 11 and upheld the lower court's decision to prohibit him from filing motions unless they were first approved by a lawyer.8

An attorney delayed filing a medical claim within 90 days, as required by the insurance policy, and neglected to file a complaint. Even though the mistake was potentially fatal to the claim, a successor attorney was able to refile the complaint. As there was no injury to the client other than anxiety, the malpractice action was dismissed without any penalty to the lawyer.9Another case involved the failure to bring suit against a railroad within three years of accident as required by federal law.10

An attorney, after declining to take her case, told a client that the two-year statute of limitations for wrongful death began when she was appointed executrix of her aunt's estate, which he later conceded was wrong, as the clock actually began when a predecessor executor had been appointed. This was only one of the charges against the attorney. Others included challenges to the attorney's trial strategy. The jury awarded the verdict to the attorney, and on appeal the high court affirmed, finding no abuse of discretion in the trial judge's decisions in post-trial motions. "Indeed, when plaintiff chose to be represented by counsel, she also chose to abide by his professional judgment regarding such decisions," according to the court.11

When attorneys sued for their fees, the unsurprising responsive pleading included a malpractice counterclaim, alleging the attorneys' failure to file a motion to dismiss a real estate broker's claim against a client for breach of implied covenant of good faith and fair dealing. At trial, the presiding judge decided this motion would have been unnecessary, as the issue was already addressed as a breach of contract claim. The Supreme Court affirmed the ruling on appeal.12

A client sued his attorney for malpractice asserting that the lawyer agreed to take care of permit inadequacies—filing an engineer's certification of fill to satisfy Act 250—when years later it turned out nothing had been done. The jury found the client 56% negligent compared to the attorney's 44%, a verdict for the attorney.13 In another example, an attorney was accused of failing to establish jurisdiction over a client's ERISA claim, the case having been dismissed by the federal court. The client's only hope for relief was to turn on the lawyer.[14]

Some examples are more egregious. In one case, a lawyer conceded certain facts in a juvenile hearing on behalf of his clients, resulting in the loss of custody of their son, a mistake later corrected by a successor attorney.15 In another case, an attorney was accused of pressuring his client to sell his home to pay legal fees, threatening to abandon the client if the fee weren't paid, and of having a conflict of interest.16 Another was accused of failing to attach net assets of individuals to enforce a judgment.17Another settled a judgment, taking notes which he then sold at a discount, without his client's knowledge or consent.18

Transactional law garners as many malpractice claims as litigation. One attorney advised a family corporation on a structured buy-out but failed to advise it to include a covenant not to compete in the sale.19 Attorneys...

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