In its opinion filed on January 6, 2020, the United States Court of Appeals for the Tenth Circuit (“Federal Appellate Court”) held that the plaintiff in a legal malpractice lawsuit filed against her former New Mexico medical malprtactice lawyer for his alleged failure to timely name a defendant physician in the underlying New Mexico medical malpractice lawsuit waited too long to file her legal malpraction action.
The plaintiff had filed a New Mexico medical malpractice lawsuit on April 9, 2009, alleging that an ultrasound of her pelvis had been misread in August 2006 and therefore her ovarian cancer was untimely diagnosed. On July 1, 2010, through discovery received from the defendant health care facility in the underlying medical malpractice lawsuit, Dr. John Berryman was identified as the physician who had misdiagnosed the plaintiff on August 8, 2006. Her New Mexico medical malpractice attorney amended the medical malpractice complaint on July 9, 2010 to name Dr. Berryman as an individual defendant.
Defendant Berryman filed a motion for summary judgment, arguing that the plaintiff’s claims against him were barred by New Mexico’s three-year statute of repose for medical malpractice claims. N.M. Stat. Ann. § 41-5-13 (1978). Ultimately, it was determined that the plaintiff’s medical malpractice claim against Defendant Berryman were time-barred because they were filed after expiration of the three-year statute of repose and were not subject to a due process exception to the statutory bar.
The plaintiff filed her legal malpractice lawsuit on April 27, 2018, asserting that her former New Mexico medical malpractice lawyer committed professional negligence and breached his contractual duty to provide quality legal services by failing to identify Dr. Berryman within the statute of repose for medical malpractice claims and timely name him as a defendant. The legal malpractice defendant moved for summary judgment, arguing that his former client’s claims against him were barred by the applicable statute of limitations, which requires that legal malpractice claims be brought within four years of accrual. The defendant’s motion was granted, and the plaintiff appealed.
Federal Appellate Court Opinion
The Federal Appellate Court stated that a claim for legal malpractice in New Mexico accrues when (1) the client sustains actual injury and (2) the client discovers, or through reasonable diligence should discover, the facts essential to the cause of action. The essential facts the client must or should have discovered for the statute of limitations to begin to run are that he or she has suffered a loss and that the loss may have been caused by the attorney’s wrongful act or omission. The question of when a client is deemed to have discovered an attorney’s malpractice and the resulting injury is generally a question of fact, but where the undisputed facts show that the client knew, or should have been aware of the negligent conduct on or before a specific date, the issue may be decided as a matter of law.
The plaintiff conceded that she suffered actual injury at the time her former New Mexico medical malpractice attorney failed to timely name Dr. Berryman in the medical malpractice lawsuit because this alleged negligence ultimately led her to lose her claim against Dr. Berryman. However, the plaintiff argued that she did not discover this injury until April 30, 2015, when the New Mexico Court of Appeals overturned the lower court decision that had relied on due process principles to allow her to proceed with her untimely filed claims. Up until this decision, the plaintiff argued, a reasonable layperson in her position would not have reason to believe that her attorney had caused her harm.
The Federal Appellate Courft disagreed, stating “when the attorney’s “malpractice results in the loss of a right,” as Ms. Cahn [the plaintiff] alleges, the client is injured “regardless of whether future events,” such as the Court of Appeals decision here, “may affect the permanency of the injury or the amount of monetary damages eventually incurred” [“Ms. Cahn testified that by June 2013 she too believed Defendants had made a mistake in failing to identify Dr. Berryman earlier in the litigation”].”
The Federal Appellate Court held: “under New Mexico law a client knows or should know of her attorney’s negligence and the resulting harm, as a matter of law, when she has notice of the negligent conduct and resulting potential harm and is forced to take action to avoid or mitigate that harm. Here, as discussed in more detail below, there is no dispute that Ms. Cahn knew of Defendants’ alleged negligence in failing to timely identify and name Dr. Berryman no later than June 2013, knew this negligent failure put her claims against him at risk of dismissal, and was forced to take action, i.e., defending against Dr. Berryman’s timeliness challenge, in an effort to avoid this harm. Accordingly, under New Mexico law she cannot claim that she neither knew nor should have known of Defendants’ alleged negligence and the resulting harm until the New Mexico Court of Appeals determined the extent and permanence of that harm in its April 30, 2015 decision … the undisputed facts show that Ms. Cahn knew or should have known during the district court proceedings that her ability to pursue Dr. Berryman for malpractice was at risk as a result of Defendants’ alleged negligence in failing to timely name him. Ms. Cahn also testified that she believed Defendants had made a mistake in not naming Dr. Berryman earlier by the time of the June 2013 conditional settlement. Further, Ms. Cahn was aware at the time of the settlement that she would not receive the stipulated damages, if at all, until Dr. Berryman’s timeliness appeal was decided. This delay and any expenses Ms. Cahn incurred in litigating the timeliness issue are also injuries attributable to Defendants’ alleged negligence that Ms. Cahn knew or should have known of no later than June 2013.”
The Federal Appellate Court held: “the undisputed facts show that by no later than June 2013, Ms. Cahn had suffered actual injury as a result of Defendants’ failure to timely identify and name Dr. Berryman in the medical malpractice complaint, and knew or should have known of Defendants’ negligent conduct and that she had been injured as a result. Accordingly, we agree with the district court that Ms. Cahn’s legal malpractice claims accrued no later than June 2013, more than four years before she filed this action.”
Cahn v. Word, No. 19-2043.
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