Actionable Legal Malpractice: Tort or Breach of Contract? By Jeffrey P. Lewis Avoiding Liability

ack in the day, what constitutes action for breach of an express contract rejected the pronouncements in Bailey, its holding applies to legal malpractice legal malpractice sounding in tort unless the wrong sued for is breach of Gorski and Fiorentino as expressions of jurisprudence. Accordingly, in the view Band legal malpractice sounding in a specific promise.” Ronald E. Mallen, binding precedent of Pennsylvania law of the federal courts, this distinction, breach of contract was crystal clear — Legal Malpractice, 2018 Edition, Volume concerning the contours of a viable legal as previously recognized in Duke & Co. claims involving negligent conduct or 1, § 8:27, p. 1067. malpractice claim sounding in breach and its progeny, is still the law in this other breaches of the standard of care is Recognizing breach of contract of contract. They contend that such commonwealth, although that distinc- tortuous, and claims involving an allega- for breach of the duty of care claims as pronouncements constitute dicta only. tion is not based upon application of the tion that the attorney failed to follow a a breach of contract creates havoc for See, e.g., New York Cent. Mut. Ins. Co. v. Gist of the Action Doctrine. Members specific instruction of the client consti- defendant lawyers based upon the seem- Edelstein, 637 Fed. Appx. 70, 72-73 (3d of the plaintiff’s bar have argued that tutes breach of contract. See, e.g., Duke ing unavailability of certain defenses. Cir. 2016) (non-precedential). In Bailey, the Gist of the Action Doctrine does not & Co. v. Anderson, 418 A.2d 613 (PA For example, a legal malpractice claim for example, the case was decided upon apply to legal malpractice claims. But Super. 1980). By way of example, under sounding in tort is subject to a two-year application of the statute of limitations a unanimous three-judge panel of the this approach, should a client retain a statute of limitations, but the statute of and not based upon its pronouncement Superior Court, in a non-precedential lawyer to represent him at a preliminary limitations for a legal malpractice claim concerning the existence of a breach of opinion, has recently rejected that argu- hearing and the lawyer appears at the sounding in breach of contract is four contract cause of action for breach of the ment. hearing and manages to waive a viable years. Moreover, seeming to be unsettled duty of care. In Seidner v. Finkelman, 2018 WL issue, that suggests a malpractice claim by any reported decision in Pennsyl- The Pennsylvania Supreme Court 4178147 (PA Super.), the court, in cit- sounding in tort. But if the attorney fails vania, there is a question of whether seemingly upended this area of the ing Supreme Court authority as old as to appear for the hearing, something the defense of contributory negligence, law in Bruno v. Erie Insurance Co., 106 1830 (Zell v. Arnold, 1830 WL 3261, at that he or she had obligated contractu- clearly available in response to a claim A.2d 48 (Pa. 2014). Bruno involved a *3 (Pa. 1830)), held that the gist of the ally to do and handle for his or her sounding in tort, is available in the de- professional liability claim by a customer action doctrine as articulated in Bruno client, that would constitute a breach of fense of any claim for legal malpractice against his insurance broker, not a client does apply to legal malpractice claims. contract. sounding in breach of contract based against a lawyer. There, in a unanimous But Seidner is a non-precedential deci- Beginning with the Supreme Court upon a breach of the duty of care. There decision, the Supreme Court applied the sion, albeit by a unanimous three-judge holding in Bailey v. Tucker, 621 A.2d is case law in other jurisdictions that “gist of the action” doctrine to draw a panel. Therefore, the door is still not 108 (Pa. 1993), however, there was case holds that contributory negligence can distinction between professional liability shut on precluding the assertion of legal law that ignored this older case law, be asserted under such circumstances. claims based upon breach of contract malpractice claims sounding in breach suggesting that a legal malpractice claim Further raising the stakes in and tort. A duty created by the terms of of contract arising out of harm caused sounding in breach of contract can be instances of a breach of contract claim the engagement contract between the by an attorney’s negligence. But Bruno stated for harm caused by the lawyer’s is the issue of the permissible measure customer and his broker involving “a presents the defense with a compelling negligent conduct. In other words, if the of damages. In the view of many trial specific promise to do something that argument that this door has been shut. lawyer does show for the preliminary courts over the years, it had been the a party would not ordinarily have been hearing but does waive a viable issue view that recovery for breach of contract obligated to do but for the existence of in his or her handling of it, that too legal malpractice is limited to disgorge- the contract,” which would constitute could constitute breach of contract. ment of fees. Beginning with Coleman breach of contract. On the other hand, This proposition was based upon the v. Duane Morris, LLP, 58 A.3d 833, if the claim “involves the defendant’s premise that a lawyer who agrees for 839 (PA Super. 2012), however, in a violation of a broader social duty owed payment of money to represent a client three-judge Superior Court decision, to all individuals, which is imposed by has, by implication, agreed to provide consequential damages were deemed the law of torts…it exists regardless of Jeffrey P. Lewis the client professional services consistent recoverable in a breach of contract the contract, then it must be regarded as is a member in with those expected of the profession at legal malpractice claim. (The Supreme a tort.” In short, the view of the Bruno the Philadelphia large. Two different three-judge panels Court granted a petition for allowance court rests upon whether the “gist of office of the law of the Superior Court have embraced of appeal, but the case settled before the action” constitutes a tort unless it firm of Eckert this proposition in Gorski v. Smith, 812 the scheduled oral argument; therefore violates “one of the ‘specific executory Seamans Cherin A.2d 683, 694 (PA Super. 2002) and the Superior Court decision in Coleman promises which comprise the contract.’” & Mellott LLC. Fiorentino v. Rapoport, 693 A.2d 208, stands, at least for the time being, as The Third Circuit in Edelstein, He serves on the 213 (PA Super. 1997). These holdings binding precedent). again in a non-precedential opinion, and PBA Professional are contrary to “[t]he prevailing rule Federal courts presiding over legal by federal district court in a diversity Liability [nationwide] … that there is no cause of malpractice claims in diversity cases have action, cites Bruno and contends that Committee.

4 Pennsylvania Bar News • November 5, 2018