Insight

“Collectibility” in Legal Malpractice: Can a client have greater rights against an attorney that existed in the underlying case?

Published on: December 1, 2020

It is well-established that a client in legal malpractice shall have no greater rights against their attorney than they had against the original defendant. That is, until the recent decision by the Supreme Court in Ewing v. Westport Insurance Corporation, 20-00339 (LA. 11/19/20), 2020 WL 6789490 where the Louisiana Supreme Court held that the “collectibility“ of the underlying judgment against the defendant is neither part of the plaintiff’s burden of proof nor the proper subject of an affirmative defense.

In Ewing, the defendant/attorney fax-filed a petition for damages but failed to forward the original petition within seven days as required by statute. As a result, the claim he sought to advance on behalf of Elaine Ewing prescribed. Ewing sued her attorney and his insurer.

Prior to trial, the tortfeasor testified that he would have filed for bankruptcy had an excess judgment been entered. On this basis, the defendants obtained a motion for summary judgment establishing that the underlying tortfeasor would have been unable to pay any amount above the $30,000 in available insurance coverage. Following trial, an award of $30,000 was entered in favor of the plaintiff and the plaintiff appealed.

The appellate court reversed citing to the decision in Rodriguez v. Traylor, 468 So.2d 1186, 1188 (La. 1985) which held that “the wealth or poverty of a party to a lawsuit is not a proper consideration in the determination of compensatory damages.“

The Supreme Court upheld the appellate opinion. In the analysis, Chief Justice Johnson on behalf of the majority also cited to the Rodriguez decision for the proposition that the wealth of the tortfeasor is not relevant to damages. The majority acknowledged that a majority of courts nationwide hold that the collectibility of a judgment is an essential element of a plaintiff’s legal malpractice case. It also observed “a growing trend” in other states to allow the defendant/attorney to plead collectability as an affirmative defense. Nevertheless, the Supreme Court in Ewing chose to follow neither position.

The defendants in Ewing did not argue that collectibility was part of the plaintiff’s burden. However, they did assert an affirmative defense on this basis. In rejecting this defense, the Ewing court found that nothing in statutory law of Louisiana limits damages based upon the collectibility of a judgment against a particular tortfeasor. In Ewing, it was established that the tortfeasor would have been immediately unable to pay an excess judgment. Nevertheless, the majority highlighted that a money judgment is valid for 10 years and may be revived for successive 10-year periods. As such, the court concluded that the money judgment has intrinsic value, regardless of immediate collectibility. To quote the majority, “impecunity is a snapshot in time.”

The concurring opinion by Justice Weimer reasons that there may be certain and rare cases where the underlying tortfeasor is truly judgment proof. In that circumstance, he writes that summary judgment in favor of the defendant may be appropriate but not under the record before the court.

Writing for the dissent, Justice Crain observed: “Thirty states have determined collectibility is relevant in a legal malpractice action. No state has reached a contrary conclusion, until now.” According to the majority, the absence of any statute making collectability a relevant consideration mandated the result under our civilian traditions. Justice Crain disagreed and argued that the majority opinion is inconsistent with the Code of Evidence articles which generally allow the admissibility of relevant evidence such as an inability to pay. La. L.C.E. art. 402. In support of his position, Justice Crain gave a hypothetical scenario involving an insolvent, uninsured driver who rear-ends a world-class professional athlete rendering him a paraplegic, resulting in damages and $50 million. About this hypothetical, he states:

“What did the plaintiff lose, or what harm did the lawyer cause the plaintiff, when the lawyer failed to preserve the claim against the insolvent, uninsured driver? The lawyer did not cause the paraplegia, nor did he caused a loss of $50 million, as that money was clearly uncollectible.“

To Justice Crain, the determinative question is the value of the lost judgment.

Insofar as the majority and concurring opinions highlight the absence of any statutes to support their conclusions, it would not be surprising for this issue to be considered by the legislature in coming years.

Collin is a Keogh Cox partner who litigates injury, commercial, and legal malpractice disputes. He lives in nearby Zachary, Louisiana with his wife Melissa and three all too active children. He is an outdoorsman, a tennis player, a cook, and a hobbyist writer.

This blog was written in partnership with Andrew "Drew" Blanchfield whose practice also includes professional liability defense.

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Insight

Fourth Circuit Brings Clarity to Peremption Statute in Suit Against Design Professional

The question addressed in MR Pittman Group, LLC versus Plaquemines Parish Government, 2015-0396 (La.App. 4 Cir. 12/2/15) was whether the five-year peremptive period set by La. R.S. 9:5607 displaces Louisiana’s general one-year prescriptive period set by La. C.C. art. 3492, when applied to tort claims against design professionals. Finding a contractor’s claim against the project engineers prescribed, the MR Pittman court held that the one-year prescriptive period governs tort claims against design professionals.

La. R.S. 9:5607 explicitly provides a peremptive period that extinguishes all claims against architects, engineers and other design professionals five years after the project is completed, thus limiting design professional liability associated with the project. The MR Pittman plaintiff/contractor argued that the statute also eliminates the one-year prescriptive period and instead creates a special five-year prescriptive period, which allowed the contractor up to five years to bring its claim against the engineers to recover for delay and other extra costs allegedly resulting from deficiencies in the construction plans. This interpretation effectively expands tort liability by increasing the time period for bringing a tort claim from one to five years. In rejecting this argument, the MR Pittman court clarified that under the statute any claimant has no more than five years after project completion to bring suit against the design professional for any cause. However, a tort claimant still has only one year to file suit from the date he “knew or should have known” of damage caused by the alleged wrongful actions of the design professional.

A secondary question addressed in MR Pittman was the date of commencement of the one-year prescriptive period, which under La. C.C. 3492 commences to run from the day damage is sustained. The defendant/engineers argued that prescription commenced when the contractor first became aware of the alleged design deficiencies early in construction, as evidenced by the contractor’s notice to the owner of the deficiencies. The contractor argued that it could not fully appreciate its damages until the change orders were resolved later in the project. Citing Louisiana Supreme Court precedent holding that the quantum of damages need not be certain or fully incurred to trigger commencement of prescription, Harvey v. Dixie Graphics, Inc., 593 So.2d 351, 354 (La. 1992), the court agreed with the engineers’ position and dismissed the claims.

Insight

Interrupted by Silence: Medical Malpractice Prescription

By C. Reynolds LeBlanc

La. R.S. 9:5628 provides that a patient/medical malpractice plaintiff must assert his or her claim within one year of the alleged negligent act or from when that act is discovered. If a claim is not raised within this time frame, it is “prescribed,” i.e., untimely. The statute also declares that all claims must be asserted within three years of the alleged negligent act, even if the patient was unaware of the malpractice. However, there are exceptions.

Under the doctrine of contra non valentem,prescription does not run if the defendant has done something to prevent theplaintiff from filing within the prescriptive period. In In re MedicalReview Panel of Gerard Lindquist, 18-444 (La. App. 5 Cir. 5/23/19), 274So.3d 750, the Louisiana Fifth Circuit considered whether a decision not totell a patient about malpractice exempted from prescription a claim which wasnot filed within three years of the alleged malpractice.

In the case, Lindquist had spinal surgery on August 22,2013. He returned on August 24, 2013 with complaints of pain. Although an x-rayshowed a metal artifact in the operative site of his back, he was not informedand was discharged. He returned the next day with continued complaints of painand an MRI was ordered. Like the x-ray, the MRI showed the metal artifact.Again, the plaintiff was not informed.

Lindquist continued to experience pain for years. When another MRI was performed on May 25, 2017, Lindquist was first informed of the metal object in his back. Within months, he filed a claim against the doctor who performed the 2013 surgery. In response, the doctor argued that the claim was prescribed under La. R.S. 9:5628 because it was filed more than three years after the surgery.

Contra non valentem applies where a plaintiff has been lulled into inaction because of concealment or fraudulent conduct by the defendant. The doctor argued that this standard was not met simply because the doctor was silent about the patient’s condition. However, the Lindquist court held that a doctor possesses an affirmative duty to advise a patient of pertinent medical information such as the presence of a metal artifact near the spine. Therefore, if the doctor, as alleged in Lindquist, failed to disclose a metal foreign object, this would constitute a fraudulent act which prevented the plaintiff from filing his claim timely. In Lindquist, prescription was interrupted by silence and the plaintiff/patient was allowed to pursue his claim.

Reynolds LeBlanc is a partner at Keogh Cox. His practice areas include commercial litigation, personal injury claims, appeals, and other matters. Reynolds is a former teacher, who in his free time plays music and perpetually talks himself into training for his next marathon.

Insight

When "Drone" Used to be a Boring Word

Webster's top two definitions of the word "drone" are as follows:

1: A stingless male bee (as of the honeybee) that has the role of mating with the queen and does not gather nectar or pollen.

2: one that lives on the labors of others: parasite

While bees and parasites have their allure, Webster's third definition of the word "drone" is the one with current intrigue.

According to Webster's, a drone is also "an unmanned aircraft or ship guided by remote control or onboard computers." Drones began as play things; but are now poised to revolutionize industry, retail, agriculture, journalism, art, and law at an ever-increasing pace.

Currently, drones are regulated by the Federal Aviation Administration which has for decades regulated flight by planes and helicopters; but not everyone can own an airplane or helicopter. Everyone can own a drone and many soon will.

The soon-to-be pervasive use of drones will stretch at the fabric of criminal and civil law and raises intriguing questions with hazy answers. For example,

1: Without probable case, can the government park a drone over a house or building, or even a crime-ridden city block, and monitor for criminal activity with sensors that easily peer through walls?

2: Does one have a reasonable expectation of privacy within a fenced-in back yard?

3: Is following a personal injury plaintiff via drone considered stalking?

4: Can a business fly a drone over a competitor's work yard to observe it processes without recourse?

5: Is it legal to use technology (which is now available) to disrupt or even crash drones flying overhead? Would that be a tort?

In an upcoming Keogh Cox blog, we will advise of pending changes to the law that may begin to answer some of these questions. For now, we will observe that the word "drone" is no longer a boring word.

Collin J. LeBlanc

Partner
Attorney
Legal Malpractice
Professional Liability