BUILDING A SOLID FOUNDATION: LEGAL MALPRACTICE LAW IN ALABAMA Lay of the Land: Purpose: Focus on jurisdictional rule and procedural changes within last three years and recent legal malpractice case law. 1. References/citations for definition of lawyer standard of care in the jurisdiction, including: Statute Ala.Code § 6-5-580 Standard of Care: In any action for injury or damages or wrongful death, whether in contract or in tort, against a legal service provider, the plaintiff shall have the burden of proving that the legal service provider breached the applicable standard of care. The applicable standard of care shall be as follows: (1) The applicable standard of care against the defendant legal service provider shall be such reasonable care and skill and diligence as other similarly situated legal service providers in the same general line of practice in the same general area ordinarily have and exercise in a like case. (2) However, if the defendant publishes the fact that he or she is certified as a specialist in an area of the law or if the defendant legal service provider solicits business by publicly advertising as a specialist in any area of the law, the standard of care applicable to such legal service provider in a claim for damages resulting from the practice of such a specialty shall be such reasonable care, skill, and diligence as other legal service providers practicing as specialist in the same area of the law ordinarily have and exercise in a like case. Alabama Pattern Jury Instructions, 25A, Malpractice, Attorneys, General Charge The standard of care applicable to legal professionals is that level of such reasonable care, skill, and diligence as other similarly situated legal service providers in the same general line of practice in the same general locality ordinarily have and exercise in a like case. A breach of the standard of care is the failure by the legal service provider to comply with the applicable standard of care, which failure proximately causes the injury or damages. Case Law Although a lawyer owes his client a duty to exercise “such reasonable care and skill and diligence as other similarly situated legal service providers in the same general line of practice in the same general area ordinarily have and exercise in a like case." Herring v. Parkman, 631 So.2d 996, 1002 (Ala. 1994). Expert testimony is generally required in a legal-malpractice case because a jury that is unfamiliar with the principles of law governing the underlying case might be incapable of discerning whether a lawyer's professional conduct falls outside an acceptable standard of care. Valentine v. Watters, 896 So.2d 385, 393 (Ala. 2004). 2. Definition/case law regarding definition of competence A plaintiff may not maintain a legal malpractice case in the absence of evidence that that attorney failed to exercise the required degree of skill in his representation of the client. Herring v. Parkman, 631 So.2d 996, 1002 (Ala.1994). "In a legal malpractice case, the plaintiff must show that but for the defendant's negligence he would have recovered on the underlying cause of action ." Dennis v. Northcutt, 923 So.2d 275, 280 (Ala. 2005). Thus, Alabama courts apply the "case within a case" doctrine." Alabama Rule of Professional Conduct 1.1 states that: A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation. 3. Recent Developments In Alabama Legal Malpractice Jurisprudence Manci v. Ball, Koons & Watson, 995 So.2d 161 (Ala. 2008). Former client's answer failed to meet meritorious-defense requirement for setting aside default judgment entered against him in law firm's action to recover payment for legal services it had rendered to him in underlying estate litigation; answer made bare, insufficient allegation that firm failed to state claim upon which relief could be granted, and former client, in asserting that firm forfeited right to compensation by engaging in abusive and overreaching misconduct in attempt to collect legal fees, did not offer any legal basis for this assertion. Bonner and C.O.W., Inc. v. Lyons, Pipes & Cook, P.C., 2009 WL 886513 (Ala. 2009). A franchisee entered into a franchise agreement with a franchisor to purchase the right to operate a restaurant. The agreement provided for renewal on the condition that the franchisee's attorney provided written notice of renewal by a set date and paid 50% of the current initial franchise fee. The franchisee intended to renew, but its attorney failed to adequately comply with either the notice provision. The franchisee also did not provide the 50% payment stipulated in the franchise agreement. The franchisor then filed a successful declaratory action with a court finding the franchisee had failed to renew under the agreement as a matter of law. In response, the franchisee filed a legal malpractice action against its former counsel based on the failure to timely renew the franchise agreement. After the suit was tried before a jury, the attorney defendants moved for judgment as a matter of law. The attorney defendants argued that the franchisee had not presented evidence that, but for the fact the renewal was untimely, the franchisee would have successfully renewed under the agreement. Specifically, they argued the franchisee had never caused the 50% fee to be paid to the franchisor, and therefore the untimely notice was not the "but for" cause of termination. The trial court agreed and granted the motion in favor of the attorney defendants. On appeal, the Supreme Court of Alabama affirmed the judgment of trial court. The Supreme Court explained that the franchisee's burden on causation required it to prove that, absent the untimely renewal, it would have a legal right to a renewal of the franchise. Because the evidence presented was insufficient to show the franchisee paid the 50% of the initial franchise fee, its legal malpractice case failed on causation. The franchisee could not show it had a legal right to renew even if the attorney defendants had properly provided notice of renewal. 4. Citation to prevailing rules of professional conduct Alabama Rules of Professional Conduct http://www.alabar.org 5. Citation to references for finding published opinions in Alabama regarding ethics and professionalism http://www.alabar.org/ogc/fopList.cfm 6. Citation to the prevailing statutes of limitation for lawyer professional liability cases. Ala. Code § 6-5-574: a) All legal service liability actions against a legal service provider must be commenced within two years after the act or omission or failure giving rise to the claim, and not afterwards; provided, that if the cause of action is not discovered and could not reasonably have been discovered within such period, then the action may be commenced within six months from the date of such discovery or the date of discovery of facts which would reasonably lead to such discovery, whichever is earlier; provided, further, that in no event may the action be commenced more than four years after such act or omission or failure; except, that an act or omission or failure giving rise to a claim which occurred before August 1, 1987, shall not in any event be barred until the expiration of one year from such date. 7. Citation to prevailing case law regarding application of the statute of limitation. The statute of limitations under Ala. Code § 6-5-574(b) begins to run when the "act or omission or failure giving rise to the claim occurs." Ex parte Panell, 756 So. 2d 862, 867 (Ala. 1999). There is, however, an exception "if the cause of action is not discovered and could not reasonably have been discovered." Id. Alabama courts have acknowledged a split of authority in caselaw concerning when the statute of limitations for a legal-malpractice action will begin to run, referring both to the “occurrence” approach (at the time of the act or omission) and the “damage” approach (when the act or omission is accompanied by some damage). Denbo v. DeBray, 968 So.2d 983, 989 (Ala. 2006). 8. Citation to any rules, regulations, or laws in the jurisdiction establishing any minimum requirements regarding document retention for law practice, and citation to any case law interpreting such rules, regs, or laws. The rules governing the retention of client records by an attorney are found in Rules 1.6 (Confidentiality of Information), 1.15(1) (Safekeeping Property) and 7.2(a)(1) (Advertising) of the Alabama Rules of Professional Conduct. Rule 1.6 is the general rule requiring an attorney to maintain confidential client communications and information subject to certain enumerated exceptions. Rule 1.15(a) requires that all records of trust accounts or other property held in trust is kept for a period of six years after the end of the representation. Rule 7.2(a)(1) requires retention of a copy or recording of the advertisement or written communication and a record of when and where it was used for a period of six years after its last dissemination. Upon termination of the representation, the lawyer is required to return all papers and property received from the client (Rules 1.15(2) and 1.16(d)). For other records, the lawyer should exercise prudent judgment in determining how long to retain the client file, taking into consideration such things as when the statute of limitations for legal malpractice has expired, any particular difficulties in the relationship with the client or the representation, if the client was a minor or incompetent that might extend the period of limitations, whether the file contains any original documents that the client might want back, and whether any documents if destroyed would be difficult to reconstruct from other sources 9. Citation to any rules, regs or laws in the jurisdiction regarding sale of a law practice. N/A 10. List CNA risk management hotline and any available ethics helpline, bar association helpline, etc. Risk Management Hotline: 1-866-262-0034 11. Reference to any recent or pending rule changes in any way affecting the practice of law. Former client's common law fraud and negligence claims against lawyer and law firm, as well as claim for declaratory judgment regarding attorney fees, should have been recast by trial court as a cause of action under the Legal Services Liability Act (LSLA), and considered for whether client sufficiently established that lawyer breached the standard of care for a legal service provider as defined by the LSLA; the claims stemmed from lawyer's acts in representing client in workers' compensation case, and the claim for declaratory judgment was based on whether, in taking attorney fee based on judgment rather than on postjudgment settlement award, lawyer's conduct fell below reasonable standard. Free v. Lasseter, 2009 WL 2573914 (Ala. 2009).