Photo thanks to photographer torbakhopper on Flickr
Update (November 11, 2015): Somehow, it snuck past me that the Minnesota Supreme Court granted a petition for review a few weeks ago by the law firm of O’Neil & Murphy in the case, discussed below. Mechanics lien lawyers might be interested in this case if the Supreme Court will be addressing the underlying lien law. ALL Minnesota litigators should be interested if the Court addresses a separate part of the Court of Appeals opinion about whether clients can settle their lawsuits and then sue their lawyers, arguing that the lousiness of the settlement was caused by attorney malpractice.
Some call this a “settle and sue strategy” and view it with great skepticism. But the Minnesota Court of Appeals okayed it under the facts of this case. If the Minnesota Supreme Court reverses, it would have huge and negative ramifications for legal malpractice plaintiffs.
Imagine: your lawyers mess up a strong case; the other side throws you a bone (offering you a small payment if you are the plaintiff or a small discount on a full recovery if you are a defendant), but accepting “the bone” would preclude any claim against your lawyer. This would put you in an extremely tough spot (and would run contrary to the courts’ interest in “judicial economy” and strong policy favoring settlement over trial).
On the flip side, what lawyer can say with a straight face that he has not had clients second-guess strategic decisions in unsuccessful litigation (or even successful litigation that fell short of client expectations)? Do we really want a rule that sets lawyers up for after-the-fact nit-picking, second-guessing? Clients having their cake and eating it too?
In my opinion, barring a malpractice case due to settlement of the underlying case would be a serious disservice to Minnesotans. Winning a legal malpractice claim is already extraordinarily difficult in Minnesota, even in cases of egregious attorney error or misconduct. Adding yet another barrier to recovery for bad lawyering would be both unwarranted and unjust.
Original post (July 30, 2015): Legal malpractice cases under Minnesota law remind me of Russian Matryoshka dolls, also known as “nesting dolls” or layer cakes because we deal with “the case within a case.” The theory is that if Attorney A screws up and Client loses Lawsuit #1, Attorney A cannot be held liable for legal malpractice if Client never could have won Lawsuit #1 in the absence of the legal malpractice.
There is no question that legal malpractice lawsuits that include the “case-within-a-case” challenge face substantial hurdles.
Now imagine a case-within-a-case-within-a-case…A piece of cake, right?
In a case first noted in a 2013 Minnesota Litigator post, Ryan Contracting Co. sued the law firm of Meagher & Gear for alleged malpractice in a lien foreclosure matter, having hired Patrick O’Neill, then of the St. Paul plaintiff’s-side legal malpractice law firm of O’Neill & Murphy. Ryan then sued O’Neill for alleged malpractice in the malpractice claim against Meagher & Gear.
This week, in a published Minnesota Court of Appeals decision, the court noted that “The parties implicitly agree that O’Neill’s conduct was negligent.” That is a step in the right direction for plaintiff in the case within a case within a case…
And the Court of Appeals went further, holding that the underlying claim against Meagher & Gear could also have legs.
Congratulations to Paul Sortland, the latest legal malpractice plaintiff’s lawyer.
Also, for those of you who are involved in lien foreclosure work or who are interested in it, the linked opinion gets quite deep into this statutory framework and merits your attention (so you do not walk into the mire that seems to have caught Meagher & Gear).
Finally, I climb on the soapbox (again): As I have advocated previously, the standard “case within a case” description of the prerequisites of a legal malpractice claim (“but for the malpractice the party would have won the underlying case”) is incomplete. Otherwise, a lawyer’s quixotic, costly, and idiotic pursuit of a losing lawsuit at her client’s expense could not trigger a legal malpractice claim. Even a talented lawyer could not have won it. Conversely, if a lawyer maintained a completely stupid and ill-fated defense (intentionally or negligently advising his client that the non-defense(s) had merit), fighting a case tooth and nail for several years (merrily billing, invoicing, collecting along the way), when a reasonable and capable lawyer would have recognized extremely high likelihood of complete liability the end of the road, even a talented lawyer could not have successfully defended it…. but surely Minnesota law should allow a claim for legal malpractice in these circumstances. The better articulation of the proper legal standard, therefore, in my opinion is: but for legal malpractice defendant’s conduct, the legal malpractice plaintiff would have obtained a more favorable result in the underlying litigation than the result obtained (not “would have won instead of lost”). Articulating the standard that way would cover these expensive-exercises-in-futility scenarios and other clear cases of professional malpractice.