California Rules Against Law Firm that Allegedly Hid Malpractice

California Rules Against Law Firm that Allegedly Hid Malpractice

Lawyers make mistakes. All professionals do. Whether you are a doctor, accountant, engineer or lawyer, at some point in your career you will make a mistake.

Dropping the ball and missing a deadline, giving bad advice or making some other mistake probably isn’t a bar violation but it is legal malpractice. Things get worse, however, when the lawyer hides his or her malpractice.

In most states, victims of legal malpractice only have a very short period of time to sue their lawyer.

In many states, the time period is just one year. An honest lawyer that makes a mistake should both tell his client and try to fix the mistake. If the mistake can’t be quickly or easily fixed, the client can then decide whether to sue the lawyer or make a claim on the lawyer’s malpractice insurance policy.

A California court this week wrestled with the question of a lawyer who doesn’t tell the client about a mistake or who delays the discovery of the mistake.

Widow Sues Lawyers, Say They Delayed Discovery of Mistake

Julie Opperman sued the McDermott Will law firm and one of its former partners in March of 2016. She claims the lawyers were originally hired to prepare her late husband’s estate plan and that she was supposed to receive upon his death a fixed sum of money and several properties. 

According to her lawsuit, the law firm botched the job and mistitled a piece of property in Arizona. That caused her to lose $7,500,000.

The estate plan documents were executed in 2011. Julie’s husband Dwight passed in June of 2013. The dates become very relevant because victims of legal malpractice in California only have 12 months to bring any claims.

All parties in the case agree that Julie would not have known about any alleged malpractice when the documents were drafted in 2011. That’s where the agreement stops.

The law firm said the Julie should have known about a potential malpractice claim in July 2013 when she learned that she was getting $7.5 million less. If true, that meant she would have had to file suit by July 2014.

California, like most states, follows something called the discovery rule.

That rule says that the period in which to sue (called the “statute of limitations”) begins on the date the victim knew or should have known of the malpractice.

Sometimes the date is obvious but other times it isn’t.

Let’s look at an example. If you are rear ended in your car and your state gives you two years to sue, everyone agrees that the two years begins on the date of the accident. Unfortunately, the discovery date in legal malpractice cases is often not as clear.

The law firm that allegedly made the mistake says that Julie “knew or should have known” about the mistake in July and certainly no later than September of 2013. According to the court record,

“Defendants [the law firm and former law partner] argue that Plaintiff’s [Julie Opperman] deposition testimony shows that, at a July 2013 meeting with [Defendants]. She learned of the exact facts underlying her current claim – that the $7.5 million would be deducted from her bequest – because she testified that learning of the deduction ‘set her alarm bells off,’ made her ‘angry’ and made her feel there was a screw up.

Defendants additionally argue that Plaintiff testified to multiple meetings between July 2013 and September 2013 during which she discussed this alleged error with Defendant… the last of which could not have occurred later than September 2013. Defendants argue that it was at this last meeting that [the Defendant partner] told Plaintiff he could not fix the error and she could get a lawyer to sue him. Defendants finally argue that Plaintiff’s seeking an attorney and then meeting… on October 8, 2013 confirms that [the Defendant told her he could not fix the problem since she sought counsel]”

Slam dunk, right?

Julie knew of the screw up in July when she found out she was getting $7.5 million less than she anticipated. If it wasn’t obvious then, it certainly had to be by September when the lawyer admitted that he couldn’t fix the problem and told her that she had a right to sue.

There are two sides to every story and Julie has a much different recollection about the meetings.

The dates when she knew or should have known are critical because Julie didn’t take action until mid-October 2014. On that date, she and the law firm signed a tolling agreement. [More on that below.] If she knew or should have known about the malpractice in July, September or even on October 8, 2013, the tolling agreement she signed in mid-October of 2014 was too late.

According to Julie Opperman, she received conflicting information from the Defendants at the July 2013 meeting. She heard there was a mistake but was also told that it was being fixed. She says she didn’t hear definitively until December of 2013 which would make the October 2014 tolling agreement well within California’s one year legal malpractice statute of limitations.

Court Rules – Legal Malpractice Claim Can Proceed

On March 5th, Los Angeles County Superior Court Judge Teresa Beaudet ruled in favor of Julie Opperman.

The court found that it simply could not determine that Julie should have known of the malpractice prior to October 2013. That means it will be up to a jury to determine when Julie learned of the malpractice.

No Evidence of Cover Up

Typically, lawyers don’t deliberately cover up their mistakes. An intentional cover up or lying to a client would in most if not all states extend the statute of limitations.

This case is helpful because it shows a more typical fact pattern.

The lawyer may or may not know there is a mistake. Instead of admitting the mistake, however, the lawyer in good faith says that he will look into the matter or will try to fix the problem.

Here the law firm claims they actually admitted the mistake, but Julie Opperman has a different recollection of the facts. In some respects, Julie is lucky because the court could have ruled that it believed that the law firm unequivocally said it had made a mistake and that she could sue.

The best course of action here would have been for Julie to sue immediately or at least obtain a tolling agreement upon the first inkling that something was wrong. Then there would be no argument and three years would not have been lost on the litigation.

We believe that neither the McDermott lawyer nor Ms. Opperman are lying. The recollections of what happened in 2013 – and during a period of intense grief for Julie – are simply different.

In the words of Julie Opperman, “So when Jonathan Lurie said this is the way it reads I said no, no, no, you must be mistaken, that’s not what my husband said. And eventually he agreed with me until he disagreed with me, you know, it is kind of like a politician, I guess.”

Tolling Agreements in Legal Malpractice Cases

In this case, we know that the parties signed a tolling agreement in October of 2014 and the lawsuit was filed in March 2016.

The legal issue in this case isn’t whether the case was filed too late in March 2016, it was whether the tolling agreement was too late when signed in October 2014.

So, what is a tolling agreement?

A tolling agreement is a contract that pauses or suspends the statute of limitations. Many malpractice insurance companies use these so that the parties can avoid filing a lawsuit. The time period to sue is delayed so that the parties can investigate or negotiate a settlement.

The number one problem with tolling agreements is that they can’t resurrect a dead claim. If you wait too long to sign a tolling agreement, the agreement has no effect because there is nothing to “toll” or “suspend.”

We have no problems with tolling agreements. In fact, they are often helpful. If the parties are contemplating a tolling agreement in a legal malpractice case remember that it is the plaintiff’s (victim) responsibility to get the agreement signed immediately. Wait too long and the agreement is useless.

Think of it this way, the tolling agreement only preserves whatever rights you have on the day it is signed. If Julie Opperman’s rights expired in July 2014, she would not have had any rights to sue in October of that year and therefore her tolling agreement would be a worthless piece of paper.

There is no indication that McDermott Will & Emery attempted to delay the signing of the tolling agreement, but we have seen that happen in other cases. If a prospective defendant (lawyer, law firm or both) won’t sign a tolling agreement, it becomes the malpractice victim’s obligation to sue immediately.

Lesson’s Learned – How Long Do You Have to Sue Your Lawyer

Every state has defined the time period in which a legal malpractice victim has to file a lawsuit. Wait too long and its simply too late.

The real issue in many professional negligence cases is defining when the statute of limitations clock started ticking.

As a general rule, we err on the conservative side and argue that the clock starts the second the victim thinks that something isn’t right. Continuous representation (discussed in another post), misrepresentation and general confusion can extend that time period, however.

In this case, the victim Julie Opperman got lucky because the judge just couldn’t tell who had the better memory. A jury, however, could still rule against her at trial.

Did You Lawyer Make a Mistake? Call Us Right Away                                                  

If you are the victim of legal malpractice don’t delay in seeking counsel.

As much as you may like the lawyer who made the mistake, he or she becomes your adversary once you and they realize a mistake was made. Not every lawyer will do what happened here and admit their mistake. And even if they do, the clock is still ticking while they attempt to fix their mistake.

If you believe that a lawyer breached a duty of care owed to you or made a mistake that caused you to lose $1 million or more, call us. Our national team of legal malpractice lawyers can help you anywhere in the United States. If we can’t help you, we probably know someone who can.

For more information, visit our legal malpractice information page.

Think you have a claim? Contact us online or by phone at 877.858.8018.


Share by email

Recent articles: