Legal negligence claim filed more than one year after “occurrence” for the claim but within one year of “discovery” of “irrevocable, non-speculative injury” was timely: LANE V. RICHARDS (COA 6/13/2008)

LANE V. RICHARDS
LEGAL NEGLIGENCE:  Statute of limitations; "Occurrence" and "Discovery" rules
2007-CA-000083
PUBLISHED: REVERSING AND REMANDING
PANEL: ACREE PRESIDING; LAMBERT, ROSENBLUM CONCUR
LAUREL COUNTY
DATE: 6/13/2008

Lane appeals TC’s grant of summary judgment to Hugh Montgomery Richards on her legal malpractice claim holding that it was not filed within the one-year statate of limitations. Lane retained Richards in April 1998 to represent her on a federal court action against the Bell County School Board. This action was subsequently dismissed by the federal court on February 11, 2002. Lane then retained another attorney, H. Wayne Roberts, to handle her appeal. The appeal was also dismissed by the Sixth Circuit Court of Appeals on August 12, 2003. By letter dated September 12, 2003, Attorney Roberts advised Lane of the dismissal and his unwillingness to further appeal to the US Supreme Court, but did correctly advise her that she had 90 days from the dismissal date to file a writ. Roberts also informed Lane that in his opinion she had a malpractice claim against Attorney Richards, and conservatively stated that she had 1 year from August 12, 2003 in which to file such a claim. Lane then retained yet another attorney, Thomas Grady, to file the writ with the US Supreme Court in October 2003, and Attorney Grady verbally advised Lane that the writ had been timely filed. While not hearing back for some months, Lane wrote to Grady on July 28, 2004 inquiring about the writ status. In response, one of the partners in Grady’s firm responded by letter dated December 28, 2004 advising Lane that Grady had been fired from the firm and more importantly, that he had prepared the writ but never filed it with the Supreme Court. Lane then filed this legal malpractice claim on November 3, 2005.

In its analysis, the COA notes that Lane’s claim against the school board officially terminated on November 11, 2003 when the time for filing the writ expired. And while she learned of Richards’ alleged legal negligence in September 2003 from Roberts, the COA noted that Lane did not discover her alleged injury until December 31, 2004 upon receiving the letter from Grady’s firm. As the COA notes, KRS 413.245 governing professional negligence claims actually contains two different limitation periods, one from the date of "occurrence" and the second from the date of actual or constructive discovery of the cause of action.

The COA held that the "occurrence" limitations period ended on November 11, 2004, one year after her time for filing an appeal expired even though Lane did not yet know that she had been damaged by that time. Thus, this legal malpractice action was not timely filed under the "occurrence" limitations period. However, the COA notes that the ‘discovery’ limitation period does not begin to run until the cause of action was discovered or should have been discovered, which requires that all elements of the cause of action be known or discoverable. As the COA reasoned, the key question here is when should Lane have discovered that Richards’ negligence had resulted in her "irrevocable, non-speculative injury"? The COA held that while Lane’s cause of action accrued when Grady failed to file her writ and the judgment became final in November 2003, but her reasonable reliance of Grady’s representations about the pending status of continued appeal prevented her from discovering the action accrual until she received the December 2004 letter from Grady’s firm. As her case against Richards was filed within 1 year of this letter, Lane’s Complaint was timely filed and not barred by KRS 413.245.

BY Chad Kessinger
SCHILLER OSBOURN BARNES & MALONEY

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One thought on “Legal negligence claim filed more than one year after “occurrence” for the claim but within one year of “discovery” of “irrevocable, non-speculative injury” was timely: LANE V. RICHARDS (COA 6/13/2008)

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