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Attorneys – Tort/Negligence — Legal Malpractice Claim – Real Property – Closing – Fiduciary Duty – Unfair Trade Practices – Securities

By: S.C. Lawyers Weekly staff//August 16, 2012

Attorneys – Tort/Negligence — Legal Malpractice Claim – Real Property – Closing – Fiduciary Duty – Unfair Trade Practices – Securities

By: S.C. Lawyers Weekly staff//August 16, 2012

RFT Management Co. v. Tinsley & Adams L.L.P. (Lawyers Weekly No. 010-079-12, 13 pp.) (Donald W. Beatty, J.) Appealed from Greenwood County Circuit Court. (Jeff D. Griffith Jr., J.) S.C. S. Ct.

Holding: Since the parties agreed at trial that plaintiff’s legal malpractice claim involved questions of fact that required submission of the claim to a jury, plaintiff may not now complain that it was entitled to judgment as a matter of law on its legal malpractice claim.

We affirm judgment for defendants.

At trial, plaintiff did not move for a directed verdict on its legal malpractice claim based on the grounds that the real property sale at issue was an improper flip transaction and that the defendant-law firm gave misleading information while failing to make required disclosures. Thus, this argument is not properly before the court.

As for plaintiff’s new trial motion made pursuant to the thirteenth juror doctrine, the scope of representation offered by the law firm was strictly limited in the retainer agreement the law firm had with plaintiff, and plaintiff’s real estate agent had knowledge of a title letter outlining the status of the properties being sold. Thus, a jury could have found there was no deceitful action by the law firm. Plaintiff has failed to show the trial court abused its discretion in denying its new trial motion.

Since plaintiff’s claim for breach of fiduciary duty arose out of the duty inherent in the attorney-client relationship and out of the same factual allegations as plaintiff’s legal malpractice claim, plaintiff’s legal malpractice claim necessarily encompassed a breach of the fiduciary duty an attorney owes to his client. Plaintiff does not set forth any specific facts to demonstrate that its breach of fiduciary duty claim is distinguishable because it arises out of a duty other than one created by the attorney-client relationship or because it is based on different material facts. Consequently, the breach of fiduciary duty claim is duplicative, and the trial court did not err in merging the breach of fiduciary duty claim with the legal malpractice claim.

Even though the trial court erred in finding the Unfair Trade Practices Act is not available against the legal profession, the error was not reversible. Because plaintiff alleged the same facts for its UTPA claim as in its legal malpractice claim — which the jury rejected — plaintiff has not shown it could have established all of the necessary elements of a claim under the UTPA.

Even if the real property transaction at issue qualified as a security, plaintiff’s securities claim was based on the same factual allegations that were rejected by the jury when it returned a verdict in favor of the law firm on the legal malpractice claim. In addition, plaintiff absolved the law firm of any potential liability resulting from an allegation of aiding and abetting a securities violation when plaintiff signed the retainer agreement with the law firm that expressly limited the scope of its representation. In that agreement, plaintiff acknowledged that it was retaining the law firm to close the transaction, prepare a deed of conveyance, and perform ministerial acts associated with the closing. Plaintiff further acknowledged that it had not retained the law firm to negotiate the contract and that it was not relying on the law firm to provide substantive advice about the transaction. Consequently, there could be no liability, so we find no error in the granting of a directed verdict on this claim.


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