* Pursuant to 5 TH C IR . R. 47.5, the Court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5 TH

C IR . R. 47.5.4. UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

Nos. 96-40562 & 96-40898

CONSOLIDATED

DERMOT PATRICK CARROLL,

Plaintiff-Appellee/Cross-Appellant,

versus

THE JAQUES ADMIRALTY LAW FIRM, PC;

LEONARD C. JAQUES,

Defendants-Appellants/Cross-Appellees.

Appeals from the United States District Court

For the Eastern District of Texas

(1:95-CV-87)

June 17, 1998

Before POLITZ, Chief Judge, GARWOOD and BARKSDALE, Circuit Judges.

PER CURIAM: *

Leonard C. Jaques and Jaques Admiralty Law Firm appeal a jury award of

$5 million in damages to Dermot Patrick Carroll on the basis that the district court

erred in not granting Jaques’ motion for judgment as a matter of law. Jaques1 See Koke v. Phillips Petroleum Co. , 730 F.2d 211 (5th Cir. 1984).

2 contends that Carroll’s claims are barred by the statute of limitations because they

were based on events occurring and known to Carroll more than four years before

he filed suit on October 5, 1994.

We find, as a matter of law, that Carroll failed to file this action within the

four years allowed for doing so and conclude that the statute of limitati o ns bars

recovery. We therefore set aside the jury’s award of actual and exemplary

damages and reverse the district court’s judgment based thereon.

BACKGROUND

In October 1981, Jaques filed suit on Carroll’s behalf in the district court for

the Eastern District of Texas, seeking damages for a back injury Carroll suffered

in Norway in 1979. Gary Baun, an associate of the Jaques firm, was to be

Carroll’s contact with Jaques throughout the pending litigation. In September

1982, the district court dismissed Carroll’s personal injury action on the grounds

of forum non conveniens

. On April 5, 1984, this Court affirmed the district court’s

dismissal, concluding that the American contacts with the case were insubstantial

and that the case was not governed by United States law. 1

Throughout the l itigation, the communication between Baun and Carroll was

sporadic. On November 9, 1984, Baun f o rwarded a copy of this Court’s opinion2 The dismissal for forum non conveniens was conditioned on three requisites: (1)

that all defendants consent to jurisdiction in a single appropriate foreign forum; (2)

that all defendants waive any defense regarding the statute of limitations; and (3)

that all defendants consent to satisfying any judgment rendered.

3 and a cover letter to Carroll. The letter, which is the subject of the fraudulent

misrepresentations at issue stated:

In response to yours of November 5, I will now advise you as to the current

status of your cause of action in this country. As you well know, after Judge

Par k er of the United States District Court for the Eastern District of Texas

issued Order of Dismissal, we vigorously challenged that Order through the

appellate process in the United States Court of Appeals for the Fifth Circuit,

which ultimately decided adversely to your position.

As a matter of protecting your interests, it was demanded that the Order of

Dismissal be conditioned on three requisites which are set forth in the second

to last paragraph, page 2 of said Order, a copy of which is attached hereto. 2

Of significance, the second condition demanded that the Defendants waive

any defense that they might have relating to any statute of limitation. As a

result of the above, you still possess an extremely vi able and meritorious

cause of action agains t the Defendants originally named. In that regard, I

have corresponded with a firm of solicitors, Latin and Masheder, Castle

Chambers, 43 Castle Street, Liverpool, E ngland L2 9TQ, requesting

assistance in the undertaking of your representation in an action to be filed

in the Courts of Great Britain. As soon as I have received contact from this

firm, I will of

course bring you up-to-date relative to all developments

related thereto.

In closing, I must stress that this matter can and will be pursued to a

successful conclusion on your behalf.

Baun corresponded with Latin and Masheder t hroughout 1984, 1985 and

1986. In 1986 and 1987, the solicitors attempted to settle Carroll’s case but4

Carroll rejected both offers. In June 1988, Baun resigned from Jaques Admiralty

Law Firm.

In a letter to Jaques on June 6, 1990, Carroll wrote:

I have written Mr. Baun many times and do not get replies. I phoned your

office some days ago and was told that Mr. Baun had left. I fail to see how

he can represent me without contacting me; now he has left your firm; I am

most distressed! Do I not have any say or choice of lawyers or firm that may

represent me? It is my strongest wish that the Jaques Admiralty Firm

continue to represent me . I urgently need to receive a reply from you

together with your comments and suggestions.

Thereafter Carroll wrote two additional letters expressing similar concerns

regarding his representation.

On Sept ember 5, 1990, Carroll wrote to the American Bar Association to

complai n about the lack of representation he was receiving from Jaques and the

Jaques Law Firm. On December 3, 1990 Carroll filed a complaint with the State

of Michigan Attorney Grievance Commission.

On October 5, 1994, Carroll filed this action in Texas state court alleging that

Jaques committed malpractice, advancing theories of negligence, gross negligence,

fraud, breach of contract, and deceptive trade practices. The jury found that the

defendants had made fraudulent misrepresentations to Ca rroll and awarded

damages in the amount of $ 5 million--$1.5 million in actual damages and $3.5

million in exemplary damages. The district court denied the defendants’ Renewed3 Crosthwait Equip. Co., Inc v. John Deere Co. , 992 F.2d 525 (5th Cir. 1993);

Gutierrez v. Excel Corp. , 106 F.3d 683 (5th Cir. 1997).

4 Guthrie v. J.C. Penney Co., Inc. , 803 F.2d 202 (5th Cir. 1986); Reeves v.

General Foods Corp. , 682 F.2d 515 (5th Cir. 1982).

5 Tex. Civ. Proc. & Rem. Code Ann. § 16.003 (Vernon 1986 & 1996); Willis v.

Maverick , 760 S.W.2d 642 (Tex. 1988); Sullivan v. Bickel & Brewer , 943

S.W.2d 477 (Tex. App.--Dallas 1995, writ denied).

6 Williams v. Khalaf , 802 S.W.2d 651 (Tex. 1990); Sullivan , 943 S.W.2d at

481.

5 Motions for Judgment as a Matter of Law, Motion for New Trial and Motion to

Alter or Amend the Judgment.

ANALYSIS

Standard of Review

The standard of review on appeal of a judgment as a matter of law is the

s ame as that used by the trial court in considering the motion. 3 We will not

overturn the verdict of a jury unless it is inconsistent with dispositive law or is not

supported by substantial evidence. 4

Legal malpractice suit s are governed by a two year statute of limitations; 5

fraud actions are governed by a four year statute of limitations. 6 The limitations on7 The issue in a malpractice claim is whether the attorney exercised that degree of

care, skill, and diligence as lawyers of ordinary skill and knowledge

commonly possess and exercise. Willis v. Maverick , 760 S.W.2d 642 (Tex. 1988);

Sullivan , 943 S.W.2d at 481.

8 The elements of actionable fraud are: 1) a material misrepresentation; 2) that is

false; 3) that the speaker knew was false when made; 4) made with the intention that

it be acted upon by the other party; 5) that the party acted in reliance on it; and 6)

damages. T.O. Stanley Boot Co. v. Bank of El Paso , 847 S.W.2d 218 (Tex.

1992); Sullivan , 943 S.W.2d at 481.

9 McMeens v. Pease , 878 S.W.2d 185 (Tex. App.--Corpus Christi 1994, writ

denied)(citing Bush v. Stone , 500 S.W.2d 885, 889 (Tex. Civ. App.-- Corpus

Christi 1973, writ ref’d n.r.e.)(“Knowledge of facts which would have excited

inquiry into the mind of a reasonably prudent person, which, if pursued by him with

reasonable diligence, would lead to the discovery of fraud, is equivalent to

knowledge of fraud as a matter of law.”); American Medical Electronics, Inc. v.

Korn , 819 S.W.2d 573, 577 (Tex. App.--Dallas 1991, writ denied)( “The

limitations period begins to run as soon as the plaintiff discovers or should discover

any harm, however slight resulting from the negligence of the defendant.”); See Also

Mooney v. Harlin , 622 S.W.2d 83 (Tex. 1981).

6 both a legal malpractice claim 7 and a fraud claim 8 accrue upon the discovery of the

injury or fraud or at such time as the injury or fraud might rea sonably have been

discovered through the exercise of reasonable diligence. 9 Defendants contend that

the plaintiff’s claims do not sound in fraud but are allegations of professional

negligence. The district court concluded that because Carroll pleaded a fraud claim

independent of his malpractice claims it was not subsumed therein. The court also

found that no evidence conclusively established as a matter of law that Carroll

knew of facts, which if pursued by him, would have led to the discovery of fraud10 Carroll v. Jaques , 927 F. Supp. 216, 223-24 (E.D. Tex. 1996).

11 See American Medical Electronics, Inc. v. Korn , 819 S.W.2d 573

(Tex.App.--Dallas 1991).

7 more than four years before October 5, 1994. 10 We are not so persuaded.

Whether this case is determined un der legal malpractice or fraud, the

plaintiff’s action is barred because both claims are based on the same conduct and

he did not file the action within four years, the longest limitation period of the two

causes of actions. To overcome the limitations bar, Carroll must show that the

statute of limitations did not begin to run until on or after October 5, 1990. The

limitat ions period begins to run as soon as the plaintiff discovers or should have

discovered facts that put him on notice of his causes of action for legal malpractice

and fraud. The limitations on Carroll’s action would not begin to accrue until he

discovered or should have discovered that Jaques was engaged in negligent or

fraudulent conduct, 11 which, according to Carroll, was the defendants knowingly

issuing mater ial misrepresentations on which Carroll relied to his detriment and

ultimately sustained a financial loss. Carroll maintains that the jury’s findings of

fraud were supported by evidence that after this Court affirmed the district court’s

forum non con veniens dismissal, the defendant represented to Carroll that they

continued to act on his behalf. The defendants did not, however, represent Carroll12 Id.

13 Mace and Jones informed Carroll of the following:

1. The defendants, American International Underwriters would not

concede that Carroll was employed by a company with a registered

office or address for service in England nor would they consent to

jurisdiction in England.

2. There would be a problem with time limits imposed by the Limitation

Act and the action would only be permitted if the English court

8 in either the United States or in a foreign forum after the dismissal.

The decision by the Texas appellate court in American Medical Electronics,

Inc. v. Korn 12 is instructive as to the commencement date for accrual of limitations

in a legal malpractice case wherein conflicting advice of counsel exists. It makes

clear that the date for that accrual herein predates Octobe r 5, 1990. In 1986 and

1987, Carroll received conflicting advice from Mace & Jones, the Liverpool

solicitors (formerly Latin & Masheder). On August 1, 1986, the solicitors informed

Carroll that the defendants believed that the conditions placed in the Fifth Circuit

order dismissing his action would not be binding on any subsidiary companies and

that they would not consent to jurisdiction in English courts. On April 30, 1987,

Mace & Jones informed Carroll that the case faced jurisdicti onal and limitation

problems in England as well as factual problems on the merits because of the length

of time that had elapsed since the accident. 13exercised its discretion and excused the time bar.

3. There has been no open admission of liability on behalf of the

defendants and the length of time that had elapsed since the accident

would possibly make the factual evidence unsatisfactory.

14 Korn , 819 S.W.2d at 577.

9 As with American Medical Electronics, the “initial damages to [Carroll],

although perhaps nomina l

, occurred when his right to receive professional and

complete advice fr om [his] attorneys was violated.” 1 4 Whether Carroll’s claim was

in negligence or fraud, when Mace & Jones told him that his case suffered from

jurisdiction and limitation problems, he knew or should have known that Baun’s

representation that, “he still possess[ed] an extremely viable and meritorious action

against the defendant’s originally named,” was possibly inaccurate. Thus, under

the discovery rule, C arroll’s cause of action, in malpractice or fraud, began to

accrue at least by April 30, 1987.

I n addition, Carroll was confronted not only with conflicting legal advice, but

also Ja ques’ failure to correspond with him. As early as October 1984 Carroll

contacted appellants complaining that he was having difficulty corresponding with

them. On October 28, 1984 he wrote “it is nearly eight months since you last wrote

me.” Further, as of

June 6, 1990, it is clear that Carroll knew that Baun had left

the law firm. These facts, coupled with the conflicting legal advice, manifestly15 Sullivan v. Bickel & Brewer , 943 S.W.2d 477, 481 (Tex. App.--Dallas 1995,

writ denied).( “[A]ccrual occurs when facts come into existence authorizing a client

to seek a judicial remedy...A party need only be aware of enough facts to apprise

him of his rights to seek a judicial remedy.”)

.

10 sufficed to lead a reasonable person to investigate. Carroll may not have known the

full extent of his damages by October 5, 1990, but he was aware of sufficient facts

to apprise him of his right to seek a judicial remedy. 15

The evidence indisputably establishes that Carroll was aware of or

should have been aware of any bad legal advice and falsity of Jaques

representations, to trigger the running of the limitations, before October 5, 1990.

Carroll’s claims are barred by both statutes of limitations.

CONCLUSION

Accordingly, we REVERSE the judgment based on the jury verdict granting

actual and exemplary dama ges to Carroll, and RENDER judgment in favor of

Leonard C. Jaques and Jaques Admiralty Law Firm, dismissing with prejudice the

claims of the plaintiff against them.