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An Update on Recent Developments in Texas Legal Malpractice and Ethics Law

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An Update on Recent Developments in Texas Legal Malpractice and Ethics Law MALPRACTICE TRENDS: AN UPDATE ON RECENT DEVELOPMENTS IN TEXAS LEGAL MALPRACTICE AND ETHICS LAW Presented by: COYT RANDAL JOHNSTON Johnston ♦ Tobey, P.C. 3308 Oak Grove Avenue Dallas, Texas 75204 (214) 741-6260 Phone (214) 741-6248 Fax [email protected] STEVE MCCONNICO Scott, Douglass & McConnico, L.L.P. 600 Congress Ave., Suite 1500 Austin, Texas 78701 (512) 495-6300 [email protected] Written by: STEVE MCCONNICO* ROBYN HARGROVE Scott, Douglass & McConnico, L.L.P. 600 Congress Ave., Suite 1500 Austin, Texas 78701 (512) 495-6300 [email protected] State Bar of Texas 3RD ANNUAL BUSINESS TORTS INSTITUTE 2011 October 13 – 14, 2011 Houston CHAPTER 3 * We wish to thank Randy Johnston of Johnston Tobey, P.C. for his valuable comments and assistance in the preparation of this paper. ROBYN BIGELOW HARGROVE 600 Congress Avenue, Suite 1500 Austin, TX 78701-3234 Phone: (512) 495-6300 Robyn joined Scott, Douglass & McConnico in 2001 and has represented individuals, business entities, professionals, and governmental entities in a wide variety of complex commercial litigation matters since that time. Robyn has successfully defended a number of professional malpractice and professional sanctions cases, both in Texas and out of state. She also has significant experience representing both plaintiffs and defendants in fiduciary litigation, contract disputes, construction litigation, business torts, and other complex commercial cases. Robyn’s practice includes both trial and appellate representation. Recognitions & Awards Texas Rising Star, a Thomson Reuters business, 2010 Order of the Coif Texas Law Review Lloyd Lochridge Chapter of American Inns of Court Representative Matters Representation of political campaign against claims of alleged Election Code violations in a gubernatorial election. Representation of law firm defending against claims of professional negligence in the drafting of a condominium declaration for a high-rise condominium in downtown San Antonio. Representation of plaintiffs in a multi-million dollar fraud and breach of fiduciary duty case involving an acquisition of oil and gas interests. Represented a Texas law firm defending against a $50 million claim for alleged professional malpractice in Florida. Obtained favorable rulings striking the plaintiff’s key expert witness and granting summary judgment for the law firm. Defended a Texas law firm against claims for sanctions arising from its representation of Mississippi silicosis clients in multi-district litigation. Obtained favorable rulings at the trial court and the Mississippi Supreme Court. Represented pipeline owner against multiple defendants in case concerning a raw water transmission line that collapsed shortly after its construction. Defendants included the performance bond surety, design engineers and various subcontractors and material suppliers. Defended Texas law firm against claims of professional malpractice, fraud, negligent misrepresentation, and conspiracy relating to executive severance agreements prepared in connection with a corporate merger. Successfully resolved lawsuit after filing a motion for summary judgment on all claims. Education Duke University, 1996, B.A. with honors in Public Policy Studies, minor in Spanish University of Texas School of Law, 2001, J.D. with honors COYT RANDAL JOHNSTON JOHNSTON ♦ TOBEY, P.C. 3308 OAK GROVE AVENUE DALLAS, TEXAS 75204 (214) 741-6260 Phone (214) 741-6248 Fax Email address: [email protected] Website: www.johnstontobey.com Randy Johnston is the author of the book Robbed at Pen Point and an attorney with the firm of Johnston Tobey PC in Dallas, Texas. He attended The University of Texas School of Law where he graduated with Honors in 1974. Mr. Johnston’s practice concentrates on legal malpractice and professional liability. He is a member of the International Academy of Trial Lawyers, the American Board of Trial Advocates, the Texas and Dallas Trial Lawyers Associations, and is a former President of the Dallas Chapter of the American Board of Trial Advocates and a former President of the Dallas Trial Lawyer’s Association. In 2010, he was one of eight recipients of “A Standing Ovation Award” recognizing him as an outstanding volunteer to the Texas Bar CLE program. EDUCATION The University of Texas School of Law, Juris Doctor with Honors Honors: Chairman, Legal Research Board Clerk, Lt. Governor’s Conference on Ethics in Government Brigham Young University, Bachelor of Arts Degree Major: English Honors: Track Scholarship (intermediate hurdles) Associate Editor, Wye Magazine (campus literary publication) President, English Circle (Club of English Majors) Pampa High School, Pampa, Texas LICENSES/CERTIFICATIONS Licensed by the State Bar of Texas and Federal Courts in Texas Board Certified: ”Civil Trial Law,” Tex. Bd. of Legal Specialization, 1981 – present Texas Board of Legal Specialization, Member 1983-1985 Personal Injury Advisory Commission, Member 1993-2000 Practice limited to litigation, specializing in professional liability. ACKNOWLEDGMENTS/HONORS Dallas Bar Association - Presidential Citation for Law Jam 2 Texas Lawyer – “The GoTo Guide” 2007 D Magazine - Best Lawyers in Dallas Texas Monthly - Texas’ Super Lawyers STEPHEN E. MCCONNICO 600 Congress Avenue, Suite 1500 Austin, TX 78701-3234 Phone: (512) 495-6300 Steve joined the firm in 1981. He has tried over 200 cases to jury verdict. Cases tried include: breach of fiduciary duty, theft of trade secrets, probate, breach of contract, environmental, election law, class action, business tort, oil and gas, personal injury, and professional malpractice defense. He is presently representing Fortune 500 Corporations, the Governor of Texas, some of Texas’s largest law firms, the Senior Justice of the Texas Supreme Court, family owned businesses, and individuals who just need a trial lawyer. Steve McConnico is committed to being a very good trial lawyer for his clients. Recognitions & Awards Fellow, American College of Trial Lawyers Fellow, International Academy of Trial Lawyers Fellow, International Society of Barristers Advocate, American Board of Trial Advocates President, Austin Chapter of ABOTA, 1993-1995 President, Tex-ABOTA, 1997 100 Texas Super Lawyers, a Thomson Reuters business, 2003 - 2009 Texas Super Lawyer, a Thomson Reuters business, 2003 - 2009 National Law Journal Who’s Who of the Legal Malpractice Bar Board Certified in Personal Injury and Civil Trial, Texas Board of Legal Specialization, since 1982 Editor in Chief, Baylor Law Review, 1975-1976 Education Baylor University, J.D. with honors, 1976 Briefing Attorney to Justice Jack Pope, Texas Supreme Court, 1976-1977 Associate Professor at Baylor University School of Law for Practice Court, 2006 Associate Professor at the University of Texas Law School for Professional Responsibility, 2002 Malpractice Trends: An Update On Recent Developments In Texas Legal Malpractice And Ethics Law Chapter 3 TABLE OF CONTENTS I. INTRODUCTION ................................................................................................................................................... 1 II. THE ATTORNEY-CLIENT RELATIONSHIP ..................................................................................................... 1 A. General Background on the Privity Rule ......................................................................................................... 1 B. Recent Texas Supreme Court Cases on Privity ............................................................................................... 2 1. Belt v. Oppenheimer, Blend, Harrison & Tate ........................................................................................ 2 2. Smith v. O’Donnell .................................................................................................................................. 2 C. When is Privity Established Under Texas Law? ............................................................................................. 3 1. Nature of the Attorney-Client Relationship ............................................................................................. 3 2. Failure to Advise That No Attorney-Client Relationship Exists ............................................................. 4 III. ESTABLISHING MALPRACTICE LIABILITY .................................................................................................. 4 A. Proving Breach of the Standard of Care .......................................................................................................... 4 B. Proving Causation ........................................................................................................................................... 5 1. The Role of Expert Testimony in Proving Causation .............................................................................. 5 2. Instructing the Jury on Causation ............................................................................................................ 7 3. Is Cause-In-Fact an Objective or Subjective Inquiry? ............................................................................. 8 4. Proving Causation and Damages Based on Settlement Value ................................................................. 9 C. Availability of Attorney’s Fees as Actual Damages ..................................................................................... 11 IV. THE FRACTURING RULE AND COMMON CLAIMS BROUGHT AGAINST ATTORNEYS ..................... 12 A. Breach of Fiduciary Duty Claims .................................................................................................................
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