LEGAL MALPRACTICE AND ATTORNEY CLIENT FEE DISPUTES
LEGAL MALPRACTICE AND ATTORNEY CLIENT FEE DISPUTES
Unfortunately, clients sometimes have problems with their attorneys, just like a consumer can have a problem with any other professional or contractor that they may hire.
To be liable for legal malpractice, an attorney must perform an act or omission that is below the standard of care that other attorneys in the community would otherwise adhere to in such a case, and that this breach of duty then causes the client to incur financial injury.
In other words, the aggrieved client cannot claim “emotional” or “mental” distress from an act of legal malpractice, unless there are other factors involved that would be something more than ordinary negligence, such as breach of fiduciary duty and/or an intentional wrongdoing.
A fee dispute is not the equivalent of legal malpractice, although the two issues may both be involved in any given case. A fee dispute typically arises when the client contends that the attorney charged an unconscionable or unreasonable fee.
The State Bar has set up a mandatory fee arbitration procedure that is administered by the county bar associations through-out the state. If the client insists, the attorney must proceed to fee arbitration. The results can be either final and binding, or advisory, depending on what the attorney and client can agree to beforehand. If only advisory, the arbitration award will be become final unless either the attorney or the client choose to dispute the award and timely file an action in the Superior Court to contest the arbitration outcome.
Fee arbitration arbitrators are usually attorneys who volunteer their time to the county bar associations. Depending on the amount in controversy, the arbitration may be decided by a panel of three arbitrators, of whom two must be attorneys and the third a non-attorney.
Both the client and the attorney can be represented by legal counsel at a fee arbitration, should they choose to do so at their own expense.
Fee arbitration proceedings do not adjudicate or decide issues of legal malpractice, unless it is tied into the fee dispute.
Depending on the amount of the fee dispute and the issues involved, either the attorney or the client may want to call as an expert witness an attorney who is conversant with the subject of attorney billing and/or ethics, and which can sometimes be a deciding factor in the outcome.
The State Bar is not going to get involved in client complaints about ordinary legal malpractice issues. The State Bar has limited resources and the client’s remedy is to file a lawsuit. The State Bar’s disciplinary program is focused on attorneys who commit criminal offenses, attorneys who commit trust account irregularities, attorneys who abandon clients, and attorneys who abscond with a client’s monies.
Making a complaint to the State Bar about an attorney’s alleged malpractice will not toll (i.e.,prevent) the applicable statute of limitations from running out.
While the calculation of the relevant statute of limitations (SOL) in which to sue an attorney is a subject that is best calculated by another attorney, as a general rule an aggrieved client must file suit within one year from the date that the malpractice is known or should have been discovered, or four years from the date of the malpractice occurring, whichever time period runs out first. See Code of Civil Procedure section 340.6.
The SOL doesn’t start to run for as long as the attorney continues to represent the client in the same matter out of which the malpractice arose, and it doesn’t start to run until the financial injury to the client actually occurs. These can be debatable points in time, however, so it must again be emphasized that the calculation of the correct SOL should be done by a knowledgeable attorney.
It is not mandatory in the State of California for an attorney to maintain legal malpractice insurance, aka errors and omissions insurance, although most attorneys probably do. If an attorney does not carry E & O insurance, the Business & Professions Code requires him/her to disclose the lack of insurance to the client at the outset of being retained.
Common areas of potential legal malpractice liability would include failing to timely file an action and the statute of limitations runs out; handling a type of legal matter for a client that the attorney is not experienced at; missing a procedural step that severely prejudices the client’s case in further proceedings in the case; charging a fee that is unconscionable (i.e., legally untenable as a matter of law) and/or grossly unfair; stealing or refusing to account for a client’s monies; failing to properly prepare a will or trust documents that deprive a beneficiary of the inheritance that they would have otherwise been expected to receive; taking advantage of a client who is legally unsophisticated, like an elder or incompetent person; and prosecuting an improper legal action or procedure that exposes the client to liability from a third party.
While every case is different, legal malpractice claims that are based on “morning after” regrets from entering into a settlement agreement which the client belatedly concludes was not in their best interest are difficult to make a successful case out of.
Every legal malpractice is a “case within a case”, in that the legal malpractice claimant must prove by a preponderance of the evidence that because of what their lawyer did wrong, that they would have had a financially better outcome. For example, if the client had a non-meritorious case and the attorney dropped the ball and didn’t timely file the action, there would be no damages as the outcome would not have been any different had the attorney acted appropriately.
Nearly all legal malpractice cases will require the retention of an expert witness at some stage of the proceedings, and this will have to be another attorney who can provide an expert opinion on what the offending attorney should have done differently on behalf of their client. It should not be unexpected that many legal malpractice cases involve “dueling expert witnesses”, wherein both sides retain expert witnesses whose opinions are at odds with one another. If the case does not settle, then it would be up to a judge or jury as the trier of fact to decide which expert to believe, if either.
One thing that an expert witness cannot do in a legal malpractice case is to give an opinion on how the underlying case would have turned out, had the defendant attorney adhered to the appropriate standard of care. While the expert witness can opine on the standard of care, it is up to the trier of fact to decide if that failure would have made a difference in the underlying “case within a case”.
Any concern about whether or not your attorney committed malpractice or charged an unreasonable fee is something that should be taken up with an experienced attorney at the earliest possible opportunity, even if your case has not been resolved by the attorney that you have concerns about.
Note: This article is intended to be for general interest purposes only, and is not a substitute for a prompt and in-depth consultation with a legal malpractice attorney if you have any concerns about your own attorney.