Louisiana Personal Injury Lawyer Blog
In a recent decision, the Louisiana Court of Appeal reversed a summary judgment granted in favor of attorneys in a legal malpractice lawsuit. The case, highlights the critical distinction between contractual and delictual claims in insurance disputes and the potential impact on the applicable statute of limitations.
Michael Belanger was involved in a car accident and obtained a judgment against the other driver for an amount exceeding her insurance policy limits. He later sued the driver’s insurance company (GEICO) for bad faith failure to settle within policy limits. Belanger was represented by the same attorneys in both cases.
GEICO successfully argued in federal court that Belanger’s bad faith claim had prescribed (or expired due to the statute of limitations) because it was subject to a one-year prescriptive period for delictual (tort) actions. Belanger then sued his attorneys for legal malpractice, claiming they failed to argue that a ten-year prescriptive period for contractual actions applied.
The trial court granted summary judgment in favor of the attorneys, but the Court of Appeal reversed this decision.
Key Legal Principles:
- Legal Malpractice: To prove legal malpractice, a plaintiff must show an attorney-client relationship, negligent representation by the attorney, and a loss caused by that negligence.
- Contractual vs. Delictual Claims: Contractual claims arise from breaches of specific contractual obligations, while delictual claims arise from breaches of general duties owed to all persons. Different prescriptive periods apply to each type of claim.
- Prescription: In Louisiana, the prescriptive period for delictual actions is one year, while the prescriptive period for contractual actions is ten years.
- Summary Judgment: Summary judgment is granted when there are no genuine issues of material fact, and the moving party is entitled to judgment as a matter of law.
The Court of Appeal focused on the nature of Belanger’s bad faith claim against GEICO. It determined that while the claim could potentially be framed as a delictual action under a specific Louisiana statute (La. R.S. 22:1973), it could also be interpreted as a contractual claim based on the insurance contract between the driver and GEICO.
The court found that Belanger’s attorneys had, in fact, argued in their brief to the federal court that the claim was contractual and subject to a ten-year prescriptive period. However, the federal court did not address this argument, as it was raised for the first time on appeal.
The Court of Appeal concluded that there was a genuine issue of material fact regarding whether Belanger’s bad faith claim against GEICO was contractual in nature. If so, it would not have been prescribed, and Belanger could have potentially recovered the excess judgment. Therefore, the court reversed the summary judgment in favor of the attorneys, allowing Belanger’s legal malpractice claim to proceed.
Implications of the Ruling
This decision underscores the importance of carefully analyzing the nature of claims in insurance disputes, especially when dealing with bad faith claims against insurers. It highlights the potential for such claims to be framed as either contractual or delictual, with significant implications for the applicable prescriptive period.
Key Takeaways
- Contractual Claims and Longer Prescriptive Periods: In some instances, pursuing a claim based on a breach of contract can provide a longer window to file a lawsuit compared to a tort-based claim.
- Importance of Legal Counsel: Consulting with an experienced attorney is crucial to ensure your claims are properly framed and that all available legal arguments are presented to protect your rights.
- Potential for Legal Malpractice: If an attorney’s negligence leads to the loss of a valid claim due to missed deadlines or improper arguments, the client may have a legal malpractice claim against the attorney.
This case serves as a reminder of the complexities involved in legal representation and the importance of seeking competent counsel. If you believe you’ve suffered a loss due to attorney negligence, it is critical to consult with an attorney experienced in legal malpractice to evaluate your case and protect your rights.
Additional Sources:MICHAEL BELANGER VERSUS SPENCER H. CALAHAN, L.L.C., SPENCER CALAHAN, JONATHAN D. MAYEAUX, BRADY PATIN, AND ABC INSURANCE CO.
Written by Berniard Law Firm
Other Berniard Law Firm Articles on Legal Malpractice: Louisiana Court Refuses to Assert Jurisdiction Over Conditional Judgment in Legal Malpractice Lawsuit and Understanding Legal Malpractice Claims: Establishing Negligence and Loss