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Breach of Professional Duty Claims Survive

By ALM Staff | Law Journal Newsletters |
December 26, 2006

In Charnay v. Cobert '- Cal.Rptr.3d ”, 2006 WL 3410818 (Cal.App. 2 Dist., 11/28/06) (Perluss, P.J.), the trial court erred by sustaining a demurrer to a former client's suit against the law firm that represented her as she adequately alleged, inter alia, legal malpractice and breach of fiduciary duty.

A former client filed suit for professional negligence/legal malpractice, breach of fiduciary duty and related causes of action against the attorney who represented her in her defense of a suit brought by a neighbor seeking contribution of $18,903 for im-provements to their subdivision. At her attorney's urging, plaintiff did not settle with the neighbors and brought several complaints of her own, resulting in an order that she pay the $18,903 originally sought from her, $25,800 in unpaid homeowner assessments and the aggregate sum of $580,000 for the opposing parties' attorney fees pursuant to a fee-shifting provision in the subdivision's conditions, covenants and restrictions (CC & R). Plaintiff's attorney also billed her $360,000. The trial court reasoned plaintiff failed to plead facts showing she would have agreed to a settlement with her neighbor and, absent such allegation, any suggestion that plaintiff would have received a more favorable outcome but for her attorney's malpractice was too speculative to state a claim. The trial court concluded all the other claims were also legally deficient. The former client appealed.

The appellate court found credible plaintiff's statement that she would have been able to settle for less than $25,000 adequate to state a claim. She need not allege that her neighbors would have accepted such a settlement because it could be implied that, having filed a lawsuit seeking less than $19,000, the neighbors would have been willing to settle at or near the $25,000 level. Additionally, plaintiff need not prove a $25,000 settlement would have been reached, only that, but for her attorney's malpractice, she would have obtained a 'more favorable result' than the $600,000-plus judgment ultimately rendered against her. Viner v. Sweet (2003) 30 Cal.4th 1232.

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