Legal Malpractice

Local Statute of Limitations Dooms Legal Malpractice Case

By (Andrew Lavoott Bluestone)

As an added reason why one should never, never, never dip toes in another state's legal proceedings, see this story on the difference between statute of limitations in an oral versus written contract in legal malpractice.

"A legal malpractice claim was time-barred because it was subject to a shorter statute of limitations for actions based on oral contracts, a U.S. District Court in Virginia has ruled in granting a dismissal. Under Virginia law, a claim for legal malpractice is subject to the statutes of limitations for breaches of contracts. A claim based on a written agreement is subject to a five-year limitations period, whereas a claim based on an oral agreement is subject to a three-year statute of limitations.

In this case, an out-of-state attorney referred the plaintiff to the lawyer for the purpose litigating an action to recover the proceeds of a loan. The plaintiff later sued for malpractice after he lost the action on the loan because the lawyer allegedly missed a deadline.

The defendant argued that the malpractice suit was time-barred because the parties had not executed a written fee agreement and the plaintiff had not filed his malpractice claim within the state's three-year statute of limitations for oral contracts.

The plaintiff contended that the longer limitations period for written agreements applied because the defendant had sent the referring attorney a letter memorializing the parties' understanding as to the scope of the lawyer's representation and his fees.

But the court said that the letter could not "be considered a written contract because ... the parties here did not clearly establish an intent to replace the oral agreement with a written agreement since [the plaintiff and the defendant] never signed any written fee agreement."

"[T]he letter sent from [the defendant to the referring attorney] did not bear [the defendant's] signature. ... [T]his court finds that the typewritten name [of the defendant on the letter] is not the equivalent of [the defendant's] signature. Thus, the letter was not signed by the party to be charged. Also, ... [the defendant] did not send the letter to [the plaintiff], instead, he sent the letter to a third party. ... [T]he letter did not merge the oral contract into a written contract."

Full post as published by New York Attorney Malpractice Blog on August 13, 2008 (boomark / email).