Legal Malpractice

What is Continuing Representation in Legal Malpractice?

By (Andrew Lavoott Bluestone)

The statute of limitations in legal malpractice in NY is three years, pursuant to CPLR 214(6).  It is a "bright line" rule, and can be both harsh and unbending.  There are exceptions, and there are question as to when the statute  begins to run.  A recent US District Court case, in Southern District of New York, authored by Judge Sullivan has an excellent discussion of the origins of the rule, of continuous representation and its relation to the continuous treatment concept of medical malpractice, and how it impacts transactional work, which has negative results years later.  We'll discuss this case today and tomorrow.

MIG, INC., v. PAUL, WEISS, RIFKIND, WHARTON & GARRISON, L.L.P., No 09 Civ. 5593 (RJS)UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK;2010 U.S. Dist. LEXIS 29548;  March 29, 2010.  While the facts of the case are somewhat complicated and deal with corporate documents and share holding issues, the legal malpractice issue is simpler.  It is alleged that Paul Weiss made mistakes in the drafting of corporate documents in 1997 that had real world consequences in 2009.  During the period between drafting and an adverse outcome in the Chancery Court of Delaware, Paul Weiss worked on the issue, billed the client on the issue, made presentations and wrote letters on the issue.  Does this amount to continuous representation?

From the decision: "New York's statute of limitations for legal malpractice is three years. See N.Y. C.P.L.R. § 214(6). The claim accrues when the [*17] malpractice is committed. Shumsky v. Eisenstein, 96 N.Y.2d 164, 166, 750 N.E.2d 67, 726 N.Y.S.2d 365 (2001). Accordingly, the three years begins to run "when all the facts necessary to the cause of action have occurred and an injured party can obtain relief in court." Williamson ex rel. Lipper Convertibles, L.P. v. PricewaterhouseCoopers LLP, 9 N.Y.3d 1, 8, 872 N.E.2d 842, 840 N.Y.S.2d 730 (2007) (quotation omitted); accord McCoy v. Feinman, 99 N.Y.2d 295, 301, 785 N.E.2d 714, 755 N.Y.S.2d 693 (2002). "In most cases, this accrual time is measured from the day an actionable injury occurs, even if the aggrieved party is then ignorant of the wrong or injury." McCoy, 99 N.Y.2d at 301 (quotation omitted).

New York does, however, recognize a limited exception to the three-year bar. The continuing representation doctrine "'recognizes that a person seeking professional assistance has a right to repose confidence in the professional's ability and good faith, and realistically cannot be expected to question and assess the techniques employed or manner in which the services are rendered."' Shumsky, 96 N.Y.2d at 167 (quoting Greene v. Greene, 56 N.Y.2d 86, 94, 436 N.E.2d 496, 451 N.Y.S.2d 46 (1992)). In such cases, the three-year statute of limitations will not begin to run until the representation ends. See Glamm v. Allen, 57 N.Y.2d 87, 94, 439 N.E.2d 390, 453 N.Y.S.2d 674 (1982).

The [*18] continuing representation doctrine is an exception, however, and not the rule. "Application of the [continuing representation doctrine is] . . . generally limited to the course of representation concerning a specific legal matter," Shumsky, 96 N.Y.2d at 168, and courts must determine "'whether there has been continuous treatment, and not merely a continuing relation'" between the attorney and client. Id. at 168 (quoting McDermott v. Torre, 56 N.Y.2d 399, 405, 437 N.E.2d 1108, 452 N.Y.S.2d 351 (1982)) (borrowing rationale from medical malpractice cases). Thus, "the doctrine is not applicable to a client's or patient's continuing general relationship with a lawyer or physician involving only routine contact for miscellaneous legal representation or medical care, unrelated to the matter upon which the allegations of malpractice are predicated." Id.; accord Williamson ex rel. Lipper Convertibles, L.P, 9 N.Y.3d at 9 ("The [continuing representation doctrine] does not apply to a continuing general relationship between patient and physician or to situations where the patient initiates routine, periodic examinations to check a condition."). Rather, the continuing representation doctrine is only applicable "where the continuous [*19] representation pertains specifically to the matter in which the attorney committed the alleged malpractice." Id.; cf. W. Vill. Assocs. Ltd. P'ship v. Balber Pickard Battistoni Maldonado & Ver Dun Tuin, PC, 49 A.D.3d 270, 854 N.Y.S.2d 340, 341 (1st Dep't 2008) ("The pleading must assert more than simply an extended general relationship between the professional and client, and the facts are required to demonstrate continued representation in the specific matter directly under dispute.")"  More tomorrow.

Full post as published by New York Attorney Malpractice Blog on April 12, 2010 (boomark / email).