Case Name: FREMONT INDEMNITY COMPANY, Appellant, v. CAREY, DWYER, ECKHART, MASON & SPRING, P.A., etc., et al., Appellees
Court: Florida Supreme Court
Jurisdiction: Florida
Decision Date: 2001-08-30
Citations: 796 So. 2d 504
Docket Number: No. SC99-86
Parties: FREMONT INDEMNITY COMPANY, Appellant, v. CAREY, DWYER, ECKHART, MASON & SPRING, P.A., etc., et al., Appellees.
Judges: SHAW, ANSTEAD, PARIENTE, LEWIS, and QUINCE, JJ, concur.
Reporter: Southern Reporter, Second Series
Volume: 796
Pages: 504–510

Head Matter:
FREMONT INDEMNITY COMPANY, Appellant, v. CAREY, DWYER, ECKHART, MASON & SPRING, P.A., etc., et al., Appellees.
No. SC99-86.
Supreme Court of Florida.
Aug. 30, 2001.
Rehearing Denied Oct. 16, 2001.
Hendrik G. Milne, Craig P. Kalil, and Silvia M. Garrigo of Abilli, Milne, Kalil & Garrigo, P.A., Miami, FL, for Appellant.
Scott A. Cole of Josephs, Jack & Gaebe, P.A., Miami, FL, for Appellees.

Opinion:
HARDING, J.
We have for review a question of Florida law certified by the United States Court of Appeals for the Eleventh Circuit as determinative of a cause pending before that court and for which there is no controlling precedent. Specifically, the court of appeals has certified the following question to this Court:
WHEN DID THE STATUTE OF LIMITATIONS BEGIN TO RUN IN THIS CASE?
Fremont Indemnity Co. v. Carey, Dwyer, Eckhart, Mason & Spring, P.A., 197 F.3d 1053 (11th Cir.1999). We have jurisdiction pursuant to article V, section 3(b)(6) of the Florida Constitution. For the reasons expressed below, we hold that the statute of limitations began to run at the conclusion of the underlying litigation.
The facts of this case, as set forth by the court of appeals, are as follows:
On February 14,1997, Fremont, a liability insurer, filed a complaint in this action against Carey, Dwyer and Spring. Counts I — III were for legal malpractice in the handling of the defense of claims against Fremont's insured, phrased in the state court action as breach of contract, professional negligence and breach of fiduciary duty claims. Count IV was for indemnity. The basis of jurisdiction is diversity of citizenship and Florida law applies. The indemnity claim was dismissed by the trial court. Fremont's notice of appeal covered that ruling as an additional ground of appeal. Fremont does not, however, proceed further as to the propriety of the ruling on Count IV. Carey, Dwyer and Spring answered Counts I — III of the complaint on April 8,1997, and on September 12,1997 moved for summary judgment on those three counts, claiming that Florida's two-year statute of limitations on the malpractice claims had elapsed prior to the institution of this action. The district court granted the motion.
SUMMARY OF FACTS
Fremont hired Spring and Carey, Dwyer to represent itself and its insured architectural firm against a claim for damages by Interdevco, the developer of a construction project on which Fremont's insured served as an architect. The parties have agreed, for the purposes of the motion for summary judgment, that Spring was negligent in rejecting settlement offers, both before and after Interdevco filed suit in state court against Fremont's insured in May 1986, without advising or consulting either client.
In 1985, Fremont discovered the negligence. It retained new counsel and terminated the Carey, Dwyer representation. Interdevco thereafter refused Fremont's settlement offers. By 1987, Fremont had incurred costs of litigation over and above what it had paid Carey, Dwyer.
In June 1991, the Resolution Trust Corporation (RTC) which had taken over loan(s) of the construction lender on the project, entered into a settlement agreement with Interdevco which included a judgment for $ 8,936,911.00 against Interdevco and an assignment of Inter-devco's cause(s) of action against Fremont's insured and Fremont. On February 21, 1995, Fremont paid RTC $ 4.5 million and received RTC's said judgment and assignment. In March 1995, Fremont agreed with its insured to pay any judgment which might be obtained against its insured by Interdevco Co. in the state court action. Fremont was unsuccessful in collateral litigation in which it attempted to establish that it had authority to direct Interdevco Co. to dismiss the state court action against its insured. On February 14, 1997, Fremont filed the instant action against Carey, Dwyer and Spring.
The underlying litigation which Carey, Dwyer was retained by Fremont to defend was still pending as of September 27, 1999, but at oral argument before the Eleventh Circuit Court of Appeals on September 30, 1999, Fremont announced that the case had been settled by its paying an additional amount.
Fremont, 197 F.3d at 1054-55. On appeal, the court of appeals certified the above question to our Court.
We agree with the court of appeals that "the alleged negligence arises out of the handling of litigation," see id. at 1058, and therefore this case is controlled by our recent decision in Silvestrone v. Edell, 721 So.2d 1173 (Fla.1998). In Silvestrone, this Court held:
[W]hen a malpractice action is predicated on errors or omissions committed in the course of litigation, and that litigation proceeds to judgment, the statute of limitations does not commence to run until the litigation is concluded by final judgment. To be specific, we hold that the statute of limitations does not commence to run until the final judgment becomes final.
721 So.2d at 1175. Applying this holding to the present case, we find that the limitations period did not begin to run until the underlying litigation for which Carey, Dwyer was retained by Fremont to defend was final.
We address two specific arguments that were raised by Carey, Dwyer in this case. First, we reject Carey, Dwyer's claim that Fremont began sustaining damages at least by 1989 in the form of attorney's fees and costs that it had paid because it lost the opportunity to settle the state court claim within the policy limits. Carey, Dwyer asserts that Silvestrone does not apply because there is nothing any party or court could do that would cure the redressable harm sustained by Fremont by 1989 because it could not be cured or changed by trial court judgment or on appeal. We disagree. As we pointed out in Perez-Abreu, Zamora & De La Fe, P.A. v. Taracido, 790 So.2d 1051 (Fla.2001), in some circumstances, the underlying litigation
may have a bearing on such damages, as the possibility exists that if the clients prevail, the clients can collect the attorney's fees from the losing party pursuant to a statutory or contractual provision. See Dade County v. Pena, 664 So.2d 959, 960 (Fla.1995) ("This Court follows the 'American Rule' that attorney's fees may only be awarded by a court pursuant to an entitling statute or an agreement of the parties.").
Moreover, the present case is a classic example of why redressable harm cannot be determined until the conclusion of the litigation. Carey, Dwyer alleges that Fremont had to pay attorney's fees and costs to defend a lawsuit that it otherwise could have settled. The settlement would have cost Fremont two million dollars. As Fremont points out in its brief, prior to the conclusion of the litigation, there was the potential of a lower settlement or judgment. Hence, even including the additional costs and fees, the possibility existed that Fremont would not suffer any re-dressable harm.
Second, Carey, Dwyer relies on the following language from Breakers of Fort Lauderdale, Ltd. v. Cassel, 528 So.2d 985, 986-87 (Fla. 3d DCA 1988):
We note, however, that the trial court was correct in rejecting the alternative argument of Breakers of Fort Lauder-dale, Ltd., [Breakers] that the statute of limitations did not begin to run until May 23, 1996, when the lawsuit which Cassel allegedly improperly failed to settle was concluded with Breakers having to pay a substantially greater amount than the amount contained in the earlier agreed upon, but unconsummated, settlement. Damage to Breakers occurred the moment it was called upon to incur the expense of having to continue to defend against a lawsuit that should have been settled but for its attorney's alleged malpractice. That moment— and the accrual of the cause of action for legal malpractice — occurred when Breakers learned that the lawsuit against it had been revived, not, as Breakers urges, when it paid damages to the claimant.
For the reasons stated above, we disapprove Breakers to the extent that the opin ion is inconsistent with Silvestrone and our opinion in this case.
Accordingly, we hold that the statute of limitations began to run in this case when the underlying litigation was final. Having answered the certified question, we return this case to the United States Court of Appeals for the Eleventh Circuit for further proceedings.
It is so ordered.
SHAW, ANSTEAD, PARIENTE, LEWIS, and QUINCE, JJ, concur.
WELLS, C.J., dissents with an opinion.