Laird v. Blacker

828 P.2d 691, 2 Cal. 4th 606, 7 Cal. Rptr. 2d 550, 92 Daily Journal DAR 6207, 92 Cal. Daily Op. Serv. 3960, 1992 Cal. LEXIS 1836
CourtCalifornia Supreme Court
DecidedMay 7, 1992
DocketS021074
StatusPublished
Cited by191 cases

This text of 828 P.2d 691 (Laird v. Blacker) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Laird v. Blacker, 828 P.2d 691, 2 Cal. 4th 606, 7 Cal. Rptr. 2d 550, 92 Daily Journal DAR 6207, 92 Cal. Daily Op. Serv. 3960, 1992 Cal. LEXIS 1836 (Cal. 1992).

Opinions

Opinion

LUCAS, C. J.

We granted review to determine whether the one-year statute of limitations for attorney malpractice actions under Code of Civil Procedure section 340.6, subdivision (a) (all ftirther statutory references are to this code unless otherwise stated) is tolled during the time the client appeals from the underlying judgment on which the claim of malpractice is based.

[609]*609Section 340.6 provides that the statute of limitations for legal malpractice commences when the client discovers, or should have discovered, the cause of action. The period is tolled during the times, inter alia, (i) the client “has not sustained actual injury,” (ii) the negligent attorney continues to represent the client, (iii) the attorney willfully conceals facts constituting the negligence, or (iv) the plaintiff is under a disability that “restricts the plaintiff’s ability to commence legal action.”1 The question before us is: what constitutes “actual injury”—the judgment against plaintiff, or the finality of the appeal therefrom?

We conclude the limitations period of section 340.6 commences when a client suffers an adverse judgment or order of dismissal in the underlying action on which the malpractice action is based. As explained below, our holding conforms to legislative intent, and adopts the present majority view as explained in the most recent cases interpreting the statute at issue here and similar statutes in other states.

I. Background

Plaintiff, a television writer, retained the law firm of Berg & Spire to prosecute a lawsuit against Spelling-Goldberg, a television production company. She alleged that Spelling-Goldberg based its television series “Family” on a script she had submitted, but failed to acknowledge or credit her contribution. After serving the complaint, Berg & Spire failed to pursue the [610]*610matter, and plaintiff retained attorney Barry Post and the law offices of Samuel Z. Winnikoff (hereafter defendants) to prosecute the same suit.2

On October 20, 1981, the suit was dismissed for lack of prosecution. (§ 583.410.) On December 7,1981, plaintiff discharged defendants and filed a notice of appeal in propria persona because she could not afford legal fees for the appeal. On September 15,1982, she voluntarily dismissed her appeal after settling with Spelling-Goldberg for $1,000. On May 17, 1983, 19 months after her action against Spelling-Goldberg was dismissed and 17 months after Post and Winnikoff were discharged, but only 8 months after she voluntarily dismissed her appeal, plaintiff filed the present malpractice action against Berg & Spire and Barry Post. In February 1986, she amended her complaint to add Sidney G. Blacker and Samuel Z. Winnikoff, also known as Associates.

Plaintiff settled with Berg & Spire for $50,000 and proceeded to trial against defendants. Defendants moved for a nonsuit, asserting the one-year limitation period of section 340.6, subdivision (a) began running when plaintiff’s suit against Spelling-Goldberg was dismissed, regardless of her ensuing appeal.3 Plaintiff asserted her cause of action for legal malpractice did not accrue until she dismissed her appeal on September 15, 1982. Defendants’ motion was denied, and the jury awarded plaintiff approximately $1.7 million in damages. Defendants’ motion for a judgment notwithstanding the verdict was denied. Defendants appealed.

The Court of Appeal reversed and remanded with directions to enter judgment in favor of defendants. It held that under section 340.6, subdivision (a), plaintiff sustained actual injury on December 7, 1981, when she discharged her attorneys after her case was dismissed and judgment was entered against her. Plaintiff appeals that decision, and asks this court to hold the limitations period was tolled until her appeal of right was resolved. We affirm the Court of Appeal decision.

II. Discussion

1. Background

Prior to 1977, the statute of limitations for legal malpractice actions was governed by section 339, subdivision 1, which provides a two-year limitations period for any action based on “a contract, obligation or liability not [611]*611founded upon an instrument in writing . . . Although section 339, subdivision 1, did not establish an accrual date for legal malpractice actions, courts generally adopted, as the date of accrual, the date on which the malpractice occurred. (Hays v. Ewing (1886) 70 Cal. 127 [11 P. 602] [cause of action for attorney malpractice barred at expiration of two years after neglect occurred].) Recognizing the harshness of a strict occurrence rule, later cases held that a cause of action for legal malpractice accrued when a plaintiff suffered “irremediable damage.” (See, e.g., Heyer v. Flaig (1969) 70 Cal.2d 223, 230 [74 Cal.Rptr. 225, 449 P.2d 161] [statute of limitations for legal malpractice begins to run on date attorney performs last negligent act].) Finally, when the Legislature adopted section 340.6 in 1977, it implicitly rejected the term “irremediable damage” and codified the discovery rule of Neel v. Magana, Olney, Levy, Cathcart & Gelfand (1971) 6 Cal.3d 176 [98 Cal.Rptr. 837, 491 P.2d 421] (hereafter Neel), and Budd v. Nixen (1971) 6 Cal.3d 195, 198 [98 Cal.Rptr. 849, 491 P.2d 433] (hereafter Budd). These cases hold that a cause of action for legal malpractice accrues when the client discovers or should discover the facts essential to the malpractice claim, and suffers appreciable and actual harm from the malpractice. Discovery of any appreciable and actual harm from the attorney’s negligent conduct establishes a cause of action and begins the running of the limitations period. (Budd, supra, 6 Cal.3d at p. 201.)

Both Budd, supra, 6 Cal.3d 195, and Neel, supra, 6 Cal.3d 176, addressed the former two-year legal malpractice statute of limitations (§ 339), but did not specifically determine whether actual injury occurs when the client suffers an adverse judgment or after an appeal of right is concluded and the judgment is final. Rather, Neel and Budd suggested the time of discovery is often a question of fact for the jury. Neel, however, explained the holding in Hays v. Ewing, supra, 70 Cal. 127, which interpreted the limitations period of section 339 when the malpractice occurred in the course of litigation. Neel stated that the Hays court “accepted the date of dismissal of the suit—that is, the date upon which the client suffered damage—as the crucial point from which the statute of limitations should run. Indeed, the court refused to adopt as the critical time the date of the affirmance of the dismissal on appeal.” (Neel, supra, 6 Cal.3d at p. 183.)

The Budd court further explained that, “Ordinarily, the client has already suffered damage when he discovers his attorney’s negligence, as occurred in Neel. ... In other cases, the infliction of the damage will alert the client to the attorney’s negligence and thus the statute of limitations will then begin to run on any malpractice action.

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828 P.2d 691, 2 Cal. 4th 606, 7 Cal. Rptr. 2d 550, 92 Daily Journal DAR 6207, 92 Cal. Daily Op. Serv. 3960, 1992 Cal. LEXIS 1836, Counsel Stack Legal Research, https://law.counselstack.com/opinion/laird-v-blacker-cal-1992.