Opinion ID: 2631128
Heading Depth: 3
Heading Rank: 1

Heading: The Abandonment Doctrine

Text: ¶ 13 Broadly stated, the abandonment doctrine provides that a client forfeits any legal malpractice claims arising from an attorney's alleged mishandling of litigation when the client settles the underlying litigation before final judicial review [i]f the compromise prevented the judicial resolution of issues that would have established that the attorney was not negligent or a cause of the client's loss. [7] ¶ 14 The Florida Court of Appeals articulated the abandonment doctrine in the seminal case of Pennsylvania Insurance Guaranty Ass'n v. Sikes. [8] Sikes arose from an attorney's failure to deny certain allegations in an underlying civil case. Although the attorney had later moved to amend his answer, the trial judge denied his motion. [9] The attorney recommended that his client appeal the decision, but the client decided to settle the case. [10] The client then sued the attorney for malpractice. [11] The court of appeals affirmed the trial court's grant of summary judgment, holding that on the facts of this case, . . . the settlement of the underlying personal injury case, while the appeal was pending, constituted an abandonment of any claim that [the client's] loss resulted from legal malpractice rather than judicial error. [12] ¶ 15 Subsequently, in Segall v. Segall, [13] the Florida Court of Appeals rearticulated its apparent commitment to the abandonment doctrine, citing Sikes and stating that [w]here a party's loss results from judicial error occasioned by the attorney's curable, nonprejudicial mistake in the conduct of the litigation, and the error would most likely have been corrected on appeal, the cause of action for legal malpractice is abandoned if a final appellate decision is not obtained. [14] ¶ 16 Other state appellate courts have also adopted the abandonment doctrine in some form. For example, in the Ohio case of E.B.P., Inc. v. Cozza & Steuer, [15] a client decided to settle a case in lieu of pursuing an appeal and then sued its law firm for malpractice. The court ruled that the client had abandoned its claim, noting that [a] settlement entered into as a result of an attorney's exercise of reasonable judgment in handling a case bars [a] malpractice claim against the attorney. [16] Similarly, a New York Supreme Court has indicated that where plaintiffs, by their own conduct in voluntarily settling prior to the appeal, precluded defendant from pursuing the very means by which he could have vindicated his representation . . . [,][t]hey should not . . . be permitted to seek damages from counsel in order to recoup a portion of the settlement. [17] ¶ 17 Taken in isolation, these statements appear to support the broad formulation of the abandonment doctrine that the district court adopted when it held that Shangri-La had forfeited [its] right to pursue any malpractice action against defendants in this case by settling the underlying redemption lawsuit. We are not convinced, however, that the cases on which the district court relied support such a broad, unforgiving rule. Instead, when read closely and examined in the context of subsequent precedent, it appears that these cases were decided on traditional principles of proximate cause, rather than on a wholesale application of the abandonment doctrine. ¶ 18 For example, in Sikes, the attorney's negligence was simply not the proximate cause of the client's damages. Because any possible negligence would have been curable except for a judicial error, it apparently was judicial error rather than attorney negligence that caused the client's losses. [18] As the Sikes court specifically stated, A reversal of a trial court's order that denies an attorney the opportunity to cure a nonprejudicial defect and enters a judgment for the opposing side because of the alleged defect, determines, essentially, that there was judicial error rather than legal malpractice. [19] Thus, even though the court affirmed the summary judgment on abandonment doctrine grounds, its underlying conclusion was that the attorney had not caused the client's loss. [20] ¶ 19 Similarly, in Segall, although the court relied in part on the abandonment theory, it also implied that summary judgment was appropriate because the plaintiffs were unable to show that it was attorney malpractice, rather than judicial error, that caused their losses in the underlying litigation. [21] They consequently could not establish redressable harm. [22] The Segall court also emphasized that it was unable to establish a bright-line rule that complete appellate review of the underlying litigation is a condition precedent to every legal malpractice action. [23] Instead, it recognized that courts must look to the underlying facts of each case. [24] ¶ 20 Although it articulated some tenets of the abandonment doctrine, the court in E.B.P., Inc. similarly refused to suggest [that] a settlement of the underlying action always operates as a waiver of a client's malpractice claim against his attorney. [25] Instead, E.B.P., Inc. was decided primarily on principles of causation. The court indicated that because the trial court erred in not granting a motion, the losses sustained by [the client] [were] not attributable to any error by [the law firm]. [26] As such, it concluded that the client failed to establish that it suffered damages proximately caused by [the law firm's] representation, and summary judgment was appropriate. [27] ¶ 21 Subsequent precedent from these jurisdictions supports our conclusion that the abandonment doctrine is not applied as broadly as Turner suggests. This precedent reveals that these jurisdictions have increasingly attempted to limit application of the abandonment theory and instead rely on traditional causation principles. [28] For instance, in the Florida case of Eastman v. Flor-Ohio, Ltd., [29] the court expressly limited the scope of the abandonment doctrine, stating that only under narrow circumstances should a cause of action for legal malpractice be deemed abandoned based upon the voluntary dismissal of the appeal taken from a related adverse judgment. The court hypothesized that the only reason the Sikes court felt comfortable using the abandonment doctrine was that it recognized there had been an error made by the trial court which would have been corrected had the appeal not been dismissed. [30] As such, counsel had not been negligent and had not caused the client's loss. [31] ¶ 22 In effect, these subsequent cases support the conclusion that the abandonment doctrine is applicable only in those cases where causation cannot be established. Although these jurisdictions have been unwilling to completely discard the abandonment doctrine label, these limitations have significantly narrowed its possible uses to instances where the alleged attorney malpractice was not the proximate cause of the client's loss.