Green v. Siegel, Barnett & Schutz

1996 SD 146, 557 N.W.2d 396, 1996 S.D. LEXIS 152
CourtSouth Dakota Supreme Court
DecidedDecember 31, 1996
DocketNone
StatusPublished
Cited by50 cases

This text of 1996 SD 146 (Green v. Siegel, Barnett & Schutz) is published on Counsel Stack Legal Research, covering South Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Green v. Siegel, Barnett & Schutz, 1996 SD 146, 557 N.W.2d 396, 1996 S.D. LEXIS 152 (S.D. 1996).

Opinions

GILBERTSON, Justice.

[¶ 1.] Siegel, Barnett & Schütz (hereinafter Law Firm), a partnership engaged in the practice of law in South Dakota, appeals from the trial court’s summary judgment ruling that SDCL 15-2-13 and 15-2-14.2, providing the statutes of limitation for legal malpractice actions in this state, are unconstitutional in violation of Article VI, § 20 of the South Dakota Constitution. We reverse and remand with instruction.

FACTS AND PROCEDURE

[¶ 2.] Paul Green and Elizabeth Sammis, plaintiffs and appellees, are the children of Mayme Green and co-executors of her estate. Mayme died June 27,1993.

[¶ 3.] In November 1976, Paul Green hired Law Firm to draft trusts for his three minor children that would qualify for annual federal gift tax exclusions for the purpose of receiving gifts from himself and from Mayme, the children’s grandmother. In 1983, Elizabeth Sammis hired Law Firm to draft a similar trust for her child and any future children. The attorney in the firm who drafted the trusts died two years later. There was no [398]*398further representation of the family by the La.w Firm.

[¶ 4.] From 1976 until Mayme’s death in 1993, she made substantial gifts to the trusts created for the respective children of Paul Green and Elizabeth Sammis. However, these gifts did not qualify for the annual federal gift tax exclusions and were considered part of Mayme’s taxable estate at her death. According to Green and Sammis, approximately $128,250.00 in additional federal estate tax was assessed, which they perceive to be the result of professional negligence of Law Firm.

[¶ 5.] On April 19,1995, Green and Sammis sued Law Firm for legal malpractice alleging breach of contract for professional services by negligently drafting these two trusts. Law Firm moved for summary judgment on grounds that the action was barred by the statutes of limitation provided by SDCL 15-2-13 and 15-2-14.2. The trial court denied the motion and held the statutes to be unconstitutional under the “open courts provision” of the South Dakota Constitution, Article VI, § 20.

[¶ 6.] Law Firm obtained an intermediate appeal from the trial court’s order, raising the following issue before this Court:

Whether the trial court erred in ruling SDCL 15-2-13 and 15-2-14.2 are unconstitutional in violation of Article VI, § 20, the “open courts” provision of the South Dakota Constitution?

STANDARD OF REVIEW

[¶7.] Our review of the constitutionality of a statute is de novo. Kyllo v. Panzer, 535 N.W.2d 896, 897 (S.D.1995). We recently noted that:

‘There is a strong presumption that the laws enacted by the legislature are constitutional and the presumption is rebutted only when it clearly, palpably and plainly appears that the statute violates a provision of the constitution. Further, the party challenging the constitutionality of a statute bears the burden of proving beyond a reasonable doubt that the statute violates a state or federal constitutional provision.’

State v. Hauge, 1996 SD 48, ¶ 4, 547 N.W.2d 173, 175 (citations omitted); Kyllo, 535 N.W.2d at 898; Simpson v. Tobin, 367 N.W.2d 757, 765 (S.D.1985).

ANALYSIS AND DECISION

[¶ 8.] Statutes of limitation are constitutionally valid enactments that involve the Legislature’s balancing of the hardship caused by the potential bar of a just claim with the advantage of barring stale claims. Note, Daugaard, v. Baltic Cooperative Building Supply Association: Statutes of Limitation Held Unconstitutional, 30 SDLRev 157 (1984). The two principal reasons given for the enactment of a statute of limitation are that:

(1) it reflects a policy of law, as declared by the legislature, that after a given length of time a defendant should be sheltered from liability and furthers the public policy of allowing people, after the lapse of a reasonable time, to plan their affairs with a degree of certainty, free from the disruptive burden of protracted and unknown potential liability ... and (2)[it] avoid[s] the difficulty in-proof and record keeping which suits involving older claims impose.

Sanborn v. Greenwald, 39 Conn.App. 289, 664 A.2d 803, 811-12 (1995)(upholding the constitutionality of a legal malpractice statute of limitation under the open courts provision of that state’s constitution).

[¶ 9.] SDCL 15-2-13, providing a six-year statute of limitations period, is applicable to the 1976 trust benefiting the Green children.1 [399]*399SDCL 15-2-14.2, enacted in 1977 and providing a three-year statute of limitations period, is applicable to the 1983 trust benefiting the Sammis children.2 This action was commenced April 19,1995, twelve years after the 1983 trust was drafted, and nineteen years after the drafting of the 1976 trust. Therefore, under either statute, the time within which an action is permitted has long ago expired. There is no allegation of fraudulent concealment, Koenig v. Lambert, 527 N.W.2d 903, 905 (S.D.1995), or a continuous relationship, Schoenrock v. Tappe, 419 N.W.2d 197, 199 (S.D.1988), such that would toll the statutory limitations period from running.

[¶ 10.] In Hoffman v. Johnson, 374 N.W.2d 117, 122 (S.D.1985), we held the statute of limitations provided by SDCL 15-12-13 commences running in legal malpractice actions from the date of occurrence of the alleged malpractice. See Holy Cross Parish v. Huether, 308 N.W.2d 575, 578, n * (S.D.1981) (for an early case applying the occurrence rule). Since our decision in Hoffman, this Court has consistently held that the present statute of limitations for legal malpractice actions, SDCL 15-2-14.2, is a rule of occurrence rather than date of discovery or date of damage. Keegan v. First Bank of Sioux Falls, 519 N.W.2d 607, 612 (S.D.1994); Haberer v. Rice, 511 N.W.2d 279, 287 (S.D. 1994); Shippen v. Pairott, 506 N.W.2d 82, 85 (S.D.1993); Kurylgs, Inc. v. Bradsky, 452 N.W.2d 111, 113-15 (S.D.1990); Schoenrock, 419 N.W.2d at 199-200.

Under the occurrence rule, absent an attorney’s fraudulent concealment of his or her negligent advice, the statute of limitations on a claim of attorney malpractice begins to run at the time of the alleged negligence and not from the time when the negligence is discovered or the consequential damages are imposed.

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Bluebook (online)
1996 SD 146, 557 N.W.2d 396, 1996 S.D. LEXIS 152, Counsel Stack Legal Research, https://law.counselstack.com/opinion/green-v-siegel-barnett-schutz-sd-1996.