Court Opinion

ID: 9685886
Source: CourtListenerOpinion
Date Created: 2023-08-24 15:07:57.022187+00
Date Added: 2024-06-11T09:19:12.830360
License: Public Domain

RENDERED: AUGUST 24, 2023
                                                          TO BE PUBLISHED

                Supreme Court of Kentucky
                               2022-SC-0070-DG

SHAN WOLFE                                                           APPELLANT

                  ON REVIEW FROM COURT OF APPEALS
V.                        NO. 2020-CA-1480
                MCCRACKEN CIRCUIT COURT NO. 18-CI-00106

JOE KIMMEL;                                                           APPELLEE
THE KIMMEL LAW FIRM

              OPINION OF THE COURT BY JUSTICE LAMBERT

                                     AFFIRMING

      In the underlying action, Shan Wolfe (Wolfe) filed a professional

malpractice claim against Joe Kimmel and The Kimmel Law Firm (collectively,

Kimmel) for negligently providing her poor legal advice regarding her exit from a

business that she co-owned. The sole issue we must address is on what date

Wolfe’s damages became irrevocable and non-speculative sufficient to trigger

the one-year statute of limitations for a professional malpractice claim under

KRS1 413.245.

      After careful review of our decisional law, we conclude that Alagia, Day,

Trautwein & Smith v. Broadbent,2 was wrongly decided and has led to

      1 Kentucky Revised Statute.

      2 882 S.W.2d 121 (Ky. 1994).
inconsistencies in our jurisprudence regarding when damages are considered

irrevocable and non-speculative for a professional malpractice claim.

Accordingly, we hereby overrule Broadbent and its progeny insofar as they hold

that, for a non-litigation legal malpractice claim, a claimant’s damages are not

irrevocable and non-speculative until the claimant knows the exact dollar

amount of damages he or she incurred because of the malpractice. To

establish more uniformity in how KRS 413.245 is applied, we now hold that for

a non-litigation legal malpractice claim, a claimant’s damages are considered

irrevocable and non-speculative when the claimant is reasonably certain that

damages will indeed flow from the defendant’s negligent act.

      We therefore affirm the Court of Appeals, though on slightly different

grounds, and hold that Wolfe’s legal malpractice claim against Kimmel was not

timely filed.

                I.   FACTS AND PROCEDURAL BACKGROUND

      The facts of this case are not disputed. In June 2014, Wolfe began a

company, GenCare, Inc. (GenCare), with Robin Lampley (Lampley). GenCare

provided in-home care for elderly and disabled individuals. Lampley served as

GenCare’s president and Wolfe as its vice president, and each owned 50% of

the business. Two years later, Wolfe wanted to leave GenCare due to her belief

that Lampley was mishandling the business’ finances. In April 2016, Wolfe

sought Kimmel’s legal advice regarding how to leave GenCare and start her own

in-home healthcare company. Kimmel advised Wolfe that she could begin the

process of starting a competing business before she resigned from GenCare.

                                        2
      Based on Kimmel’s advice, Wolfe started her own in-home healthcare

business, Legacy In Home Care, Inc. (Legacy), without first resigning from

GenCare. Due to licensing requirements, there was a delay of several weeks

before Legacy could begin operating. During that period, Kimmel further

advised Wolfe that she could take GenCare employees and clients with her to

Legacy. Kimmel sent letters to two of GenCare’s clients, the Veteran’s

Administration and ClearCare Software, which stated that Wolfe “[had] all

rights legally to add any and all clients/patients of GenCare, Inc., who wish to

contract services with her.” Wolfe contacted employees of GenCare to inform

them she was starting Legacy, and several agreed to leave GenCare and work

for Legacy. Kimmel also advised Wolfe that she could take patient charts and

records from GenCare.

      By late July 2016, Wolfe had obtained all the necessary licensing

requirements for Legacy to operate. On July 29, Wolfe sent a formal letter of

resignation to Lampley and promptly thereafter began operating Legacy using

former GenCare employees. On August 1, 2016, Lampley’s attorney sent Wolfe

a cease-and-desist letter which stated that “[a]s a director and/or officer of

GenCare, Inc., [Wolfe owed] the company a common law fiduciary duty and a

statutory duty under K.R.S. § 271B.8-300 and K.R.S. § 271B.8-420.” The

letter stated that if Wolfe did not cease Legacy’s operations, return all clients to

GenCare, and give all of Legacy’s profits to GenCare, GenCare would sue Wolfe

and Legacy for tortious interference with contract and prospective contract.

Lampley’s attorney also sent letters to the employees that left GenCare for

                                         3
Legacy, informing them that their contracts with GenCare contained non-

compete clauses.

      On August 19, 2016, Lampley and GenCare sued Wolfe, Legacy, and

several Legacy employees who formerly worked for GenCare. Shortly

thereafter, Kimmel determined that he would be unable to represent Wolfe and

Legacy in the suit and referred Wolfe to attorney Todd Farmer (Farmer) who

specialized in that area of the law. Wolfe met with Farmer in August 2016, and

during that meeting Farmer “immediately and repeatedly reprimanded” Wolfe

for her actions. He informed her that she could not legally start a competing

company while still working for GenCare, and that she had no right to take

GenCare employees, patients, or patient records. Farmer further advised Wolfe

that she needed to reach a settlement agreement with GenCare and Lampley as

soon as possible because she would undoubtedly lose if the case proceeded to

trial. Almost a year later, on July 17, 2017, the parties’ settlement agreement

was finalized. Wolfe agreed to pay Lampley $30,000 and relinquish her

GenCare shares to Lampley, which were valued at $150,000.

      Based on the foregoing, Wolfe filed the underlying professional

malpractice claim against Kimmel on February 14, 2018. Her complaint

alleged that Kimmel had been negligent in advising her regarding her exit from

GenCare and sought compensatory damages for both her economic losses and

for “humiliation, embarrassment, personal indignity, apprehension about her

future, emotional distress, and mental anguish[.]” After nearly two years of

                                       4
discovery, Kimmel filed a motion for summary judgment on January 28, 2020.

Kimmel’s motion alleged that Wolfe failed to file her claim within the one-year

statute of limitations period of KRS 413.245.3 The trial judge granted Kimmel’s

motion. The order simply stated: “The Court believes plaintiff failed to file her

complaint in a timely manner and it must therefore be dismissed, with

prejudice. In reaching this conclusion, the Court relies on the arguments

expressed in support of the defendant’s motion and the citations contained

therein.”

      Kimmel’s motion for summary judgment argued that the statute of

limitations began to run no later than August 2016. Citing Conway v. Huff,4

Kimmel noted that Wolfe was informed by another attorney that she had been

improperly represented by Kimmel in August 2016. Also during that month,

legal harm caused by that negligent representation had occurred: Wolfe’s

complaint stated that GenCare’s cease and desist letter from August 1 caused

her emotional distress and mental anguish; GenCare and Lampley filed a

lawsuit against her on August 19 based on her actions in following Kimmel’s

advice, for which Wolfe had to expend money to defend and suffered emotional

distress; and Wolfe paid a $5,000 retainer to hire an attorney to represent the

GenCare employees also named in the suit. And, more damages were certain

to occur: Farmer encouraged her to reach a settlement agreement with Lampley

      3 We note that Kimmel asserted a statute of limitations defense in his answer to

Wolfe’s February 14, 2018, complaint.
      4 644 S.W.2d 333 (Ky. 1982).

                                          5
as soon as possible because she “would lose in a trial and end up owing Ms.

Lampley a significant amount of money.”

         Kimmel disputed Wolfe’s argument that her legal harm did not become

irrevocable and nonspeculative until she settled with Lampley in July 2017. In

doing so, he relied on Board of Education v. Zurich Insurance Co., a U.S. District

Court case, which held that “‘fixed and non-speculative’ does not mean that

damages, to trigger the initiation of the limitations period, must be translatable

into a specified dollar amount. Kentucky law has never required as much[.]”5

That holding was later relied upon by this Court in Matherly Land Surveying,

Inc. v. Gardiner Park Development, LLC.6

         Wolfe appealed, and a split Court of Appeals panel affirmed.7 Relying

primarily on Saalwaechter v. Carroll,8 the Court of Appeals rejected Wolfe’s

claim that her damages had not become irrevocable and non-speculative

sufficient to trigger KRS 413.245 until she settled with Lampley in July 2017.9

Instead, it held “that it was clear by August 2016” that she would incur

damages because of Kimmel’s negligence, and her claim was therefore

         5 180 F. Supp. 2d 890, 893 (E.D. Ky. 2002), aff'd sub nom. Estill Cnty. Bd. of

Educ. v. Zurich Ins. Co., 84 Fed. Appx. 516 (6th Cir. 2003).
         6 230 S.W.3d 586, 591 (Ky. 2007).

         7 Wolfe v. Kimmel, 2020-CA-1480-MR, 2021 WL 5751648 (Ky. App. Dec. 3,

2021).
         8 525 S.W.3d 100 (Ky. App. 2017).

         9 Wolfe, 2021 WL 5751648, at *2.

                                             6
untimely.10 Wolfe thereafter appealed to this Court, and we granted

discretionary review.

                                  II.   ANALYSIS

A. Standard of Review

      In reviewing an appeal from an order granting summary judgment, this

Court determines whether the trial court was correct in finding that there were

no genuine issues of material fact and that the moving party was entitled to

summary judgment as a matter of law.11 As summary judgment requires only

an examination of the record to determine whether material facts exist, we

generally review a grant of summary judgment de novo, giving no deference to

the trial court’s assessment of the record or its legal conclusions.12

B. KRS 413.245

      It is not disputed that KRS 413.245 is the applicable statute of

limitations for Wolfe’s professional malpractice claim against Kimmel. KRS

413.245, enacted on July 15, 1980, directs in relevant part:

      [A] civil action, whether brought in tort or contract, arising out of
      any act or omission in rendering, or failing to render, professional
      services for others shall be brought within one (1) year from the
      date of the occurrence or from the date when the cause of action
      was, or reasonably should have been, discovered by the party
      injured.

      10 Id. at *3.

      11 Kentucky Rule of Civil Procedure (CR) 56.03.

      12 See, e.g., Hammons v. Hammons, 327 S.W.3d 444, 448 (Ky. 2010).

                                          7
As this Court has previously explained, KRS 413.245 actually contains two

separate statutes of limitations.13 The first is a statute limiting to “one year

from the date of the occurrence,” and the second statute provides a limit from

one year “from the date when the cause of action was, or reasonably should

have been, discovered by the party injured,” if that date is later in time than

the occurrence date.14 Because “occurrence” and “cause of action” are used

synonymously within the statute, the occurrence date is the date that a cause

of action has accrued.15

      A cause of action is deemed to accrue in Kentucky where
      negligence and damages have both occurred, subject in certain
      kinds of actions to the additional requirement of discovery of the
      claim by the plaintiff. . . . [T]he use of the word “occurrence” in
      KRS 413.245 indicates a legislative policy that there should be
      some definable, readily ascertainable event which triggers the
      statute. . . . [T]his is the date of “irrevocable non-speculative
      injury.”16

In other words, “a ‘wrong’ requires both a negligent act and resulting injury.

Damnum absque injuria, harm without injury, does not give rise to an action for

damages against the person causing it,”17 and “mere knowledge of some

elements of a tort claim, such as negligence without harm, is insufficient to

      13 Michels v. Sklavos, 869 S.W.2d 728, 730 (Ky. 1994).

      14 Id.

      15 Id.

      16 Id. (quoting Nw. Nat. Ins. Co. v. Osborne, 610 F. Supp. 126, 128 (E.D. Ky.

1985)).
      17 Michels, 869 S.W.2d at 731.

                                          8
begin running the limitations period where the cause of action does not yet

exist.”18

       The second statute of limitations within KRS 413.245, the discovery date,

is the codification of a common law principle recognized in cases such as

Tomlinson v. Siehl,19 and Louisville Trust Co. v. Johns–Manville Products.20, 21

The discovery rule “presumes that a cause of action has accrued, i.e., both

negligence and damages has occurred, but that it has accrued in

circumstances where the cause of action is not reasonably discoverable[.]”22

The discovery rule acts to toll the statute of limitations “until the claimant

knows, or reasonably should know, that injury has occurred.”23 Accordingly,

the discovery date is only implicated if a complaint for professional malpractice

was not filed within one year of the occurrence date,24 and it “often functions

as a ‘savings’ clause or ‘second bite at the apple’ for tolling purposes.”25

       18 Queensway Fin. Holdings Ltd. v. Cotton & Allen, P.S.C., 237 S.W.3d 141, 148

(Ky. 2007).
       19 459 S.W.2d 166 (Ky. 1970) (holding that the statute of limitations for a

medical malpractice claim against a physician who negligently performed a
sterilization surgery on a female patient did not begin to run until she discovered she
was pregnant).
       20 580 S.W.2d 497 (Ky. 1979) (holding that the Tomlinson discovery rule

extended to tort actions for injuries resulting from latent disease caused by exposure
to harmful substances).
       21 Michels, 869 S.W.2d at 732.

       22 Id.

       23 Id.

       24 Id. at 730 (“If the suit was filed within one year of the ‘date of occurrence,’ we

need not concern ourselves with the meaning and application of the discovery rule.”).
       25 Queensway, 237 S.W.3d at 147.

                                             9
C. KRS 413.245 Case Law

      Notwithstanding the ostensible simplicity of the foregoing principles, the

history of our case law in this area is “extant, yet murky”26 to say the least, and

demonstrates that difficulties often arise in determining whether and when an

“irrevocable and non-speculative injury” has occurred. It is therefore useful to

begin with a discussion of several precedents.

      The first case to address KRS 413.245 following its enactment was

Conway v. Huff. Ruby Huff was represented by attorney James Conway during

her dissolution of marriage action but was thereafter dissatisfied with her

award under the dissolution judgment.27 On January 18, 1980, Huff consulted

another attorney, Richard Porter, who informed her that she had been poorly

or inadequately represented by Conway.28 Six weeks later, Porter told Huff she

could file a claim against Conway for legal malpractice.29 Huff did not file her

legal malpractice claim until January 22, 1981, and the circuit court dismissed

it on Conway’s motion for summary judgment on the grounds that it was

barred by KRS 413.245.30

      The sole issue that the Conway Court addressed was “if knowledge that

one has been wronged starts the running of the statute of limitations or if

knowledge that the wrong is actionable starts the running of the statute of

      26 Zurich, 180 F. Supp. 2d at 891.

      27 Conway, 644 S.W.2d at 334.

      28 Id.

      29 Id.

      30 Id.

                                           10
limitations.”31 It likened the situation to the discovery theory used to

determine when the statute of limitations begins to run on a medical

malpractice claim, and reasoned that “the statute [starts] to run when the

surgery patient discovers the sponge,” not when “an attorney tells the patient

that legal action lies against the surgeon[.]”32 The Conway Court held that “the

statute of limitations on Huff's claim against Conway started to run on January

18, 1980, the day that she discovered that she may have been poorly or

inadequately represented,” and was therefore time barred.33

      One year after Conway was rendered by this Court, the Court of Appeals

issued Graham v. Harlin, Parker & Rudloff.34 As discussed below, Graham was

subsequently overruled by Broadbent. But, as we are overruling Broadbent,

and because the Broadbent Court did not discuss Graham, a synopsis is useful

for context. Frances Graham was represented by William Rudloff in her

dissolution of marriage action.35 A provision of her dissolution judgment stated

that Graham would receive $500 per month “toward the support of the

family.”36 Due to this wording, on August 7, 1980, the IRS declared the

payments to be alimony taxable to Graham and assessed a deficiency against

her personal income tax returns for the years 1975 through 1981 exceeding

      31 Id.

      32 Id.

      33 Id.

      34 664 S.W.2d 945 (Ky. App. 1983), overruled by Alagia, Day, Trautwein & Smith

v. Broadbent, 882 S.W.2d 121 (Ky. 1994).
      35 Graham, 664 S.W.2d at 946.

      36 Id.

                                           11
$17,000.37 On October 6, 1980, Graham petitioned the U.S. Tax Court for a

redetermination of the deficiency.38

      Meanwhile, a state circuit court held a hearing and determined that all

parties to the dissolution action intended the $500 payments to be child

support, and on June 25, 1981, the court entered a second dissolution

judgment amending the original decree nunc pro tunc.39 During the same

hearing, Graham testified that she received her notice from the IRS in

November 1980, and she knew at that time that the IRS’s decision was based

on the wording of her dissolution judgment.40 Graham was unsuccessful in

her petition before the U.S. Tax Court and on August 30, 1982, it entered a

judgment against her holding that the circuit court’s nunc pro tunc order was

not retroactive for tax purposes and assessed a $5,487 deficiency against her

for the years 1975 through 1977.41

      On September 23, 1981, Graham filed a legal malpractice claim against

Rudloff, but summons was not issued and served until March 12, 1982.42 The

suit was dismissed on Rudloff’s motion for summary judgment on the grounds

      37 Id.

      38 Id.

      39 Id.

      40 Id.

      41 Id.

      42 Id.

                                       12
that it was untimely filed, and Graham appealed.43 The Court of Appeals

affirmed; it reasoned that

      the date on which she discovered that a wrong had occurred and
      that it was caused by [Rudloff] was in November 1980, after she
      became aware that the tax deficiency had been assessed against
      her, and that as the initial tax court hearing for a redetermination
      went on, she also became aware that the reason was because of
      the way the decree was worded. It was then she realized the
      responsibility was [Rudloff’s].44

The court rejected Graham’s assertion that “she first knew she had a right to

sue on September 1, 1982, when there was a final determination by the U.S.

Tax Court[.]”45 Citing Conway, the court reasoned that “the running of the

statute on appellant’s claim began on the day that she discovered that she may

have been poorly or inadequately represented.”46 And, as that date was

sometime in November 1980, the March 1982 issuance and service of

summons was untimely.47

      The next two cases, Hibbard v. Taylor48 and Michels v. Sklavos, although

rendered two years apart, can be considered companion cases.

      In Hibbard, Coleman Taylor was represented by James Hibbard during

litigation wherein Taylor sought to rescind a contract based on his allegation

      43 Id. at 946-47.

      44 Id. at 947.

      45 Id.

      46 Id. (internal quotation marks omitted).

      47 Id.

      48 837 S.W.2d 500 (Ky. 1992).

                                          13
that the other party to the contract had misrepresented material facts.49

Following a trial, directed verdict was entered against Taylor for failing to

present any evidence that the alleged misrepresentations were material.50

Taylor appealed the trial court’s ruling to the Court of Appeals, which affirmed;

the decision became final on August 25, 1989.51 Hibbard represented Taylor

throughout the entirety of the appeal.52

      On August 24, 1990, Taylor filed a claim for professional malpractice

against Hibbard which was subsequently dismissed on summary judgment as

time barred.53 The trial court reasoned that if malpractice in fact occurred,

“then the directed verdict itself was the notice to [Taylor] herein that he had

been wronged which started the statute of limitations running.”54 The Court of

Appeals reversed and reasoned that “because damage is necessarily speculative

during the pendency of appeal, a cause of action for legal malpractice does not

accrue until the appellate process is final.”55

      Relying on Conway, the Hibbard Court affirmed, and reasoned that

Taylor could not have “discovered the sponge” when the directed verdict

judgment was entered against him because at that point no third party

      49 Id. at 500

      50 Id.

      51 Id.

      52 Id.

      53 Id.

      54 Id. at 500-01.

      55 Id. at 501.

                                        14
attorney had told him he had been poorly represented (as Huff was told in

Conway) and, moreover, he could not have stated with certainty that the

directed verdict against him was caused by his attorney’s error and not the

trial court’s error.56 Stated differently, if Taylor had filed a malpractice suit at

that time, he could not have claimed that his attorney’s error was the

proximate cause of his legal injury nor could he claim that he had suffered

damages, because the appellate court could have ultimately ruled in his favor:

      It is evident to us that Taylor discovered his cause of action when
      he reasonably should have—when the result of the appeal became
      final and the trial court's judgment became the unalterable law of
      the case. Only then was Taylor put on notice that the principal
      damage (the adverse judgment) was real; but more importantly,
      only then could he justifiably claim that the entire damage was
      proximately caused by counsel's failure, for which he might seek a
      remedy, and not by the trial court's error, for which he would have
      none.57

The Hibbard Court accordingly affirmed the Court of Appeals and held that

Taylor’s claim was timely filed.58

      In Michels, John Sklavos hired Fredrick Michels and Nicholas Carlin to

represent him in a wrongful termination suit against his former employer.59

The claim was initially filed in state circuit court but was later removed to the

      56 Id. at 502 (“Generally, in prosecuting an appeal, an attorney tells the client

that the sponge was left by the trial court, not by trial counsel, and that any harm
(e.g., cost of appeal, bond, adverse judgment) is damnum absque injuria [damage
without injury].”).
      57 Id.

      58 Id.

      59 Michels, 869 S.W.2d at 728.

                                           15
U.S. District Court for the Western District of Kentucky.60 While the case was

pending in federal court, Sklavos fired Michels and Carlin and retained

Benjamin Lookofsky to continue the litigation.61 Thereafter, on September 14,

1989, the U.S. District Court granted the employer’s motion for summary

judgment based on Sklavos’ failure to first pursue administrative remedies.62

      On March 23, 1990, Sklavos filed a professional malpractice claim

against Michels and Carlin.63 The claim was dismissed on summary judgment

for untimeliness based on the trial court’s finding that Sklavos should have

known of any alleged wrong when he retained Lookofsky approximately one

and half years before filing the malpractice suit because Lookofsky “knew or

should have known of any alleged negligence immediately upon taking over the

case[.]”64

      This Court disagreed; it reasoned that what Sklavos “knew or should

have known,” i.e., the discovery date, was irrelevant because Sklavos had filed

his claim within one year of the occurrence date.65 Relying on Hibbard, the

Michels Court reasoned that

      [w]here, as in the present case, the cause of action is for “litigation”
      negligence, meaning the attorney's negligence in the preparation
      and presentation of a litigated claim resulting in the failure of an
      otherwise valid claim, whether the attorney's negligence has

      60 Id.

      61 Id. at 728-29.

      62 Id. at 729.

      63 Id.

      64 Id.

      65 Id. at 730.

                                        16
      caused injury necessarily must await the final outcome of the
      underlying case.66

So, even assuming arguendo that Michels and Carlin were in fact negligent and

that Lookofsky informed Sklavos that they were negligent, until the U.S.

District Court issued an adverse ruling against Sklavos, he would have had no

cause of action against them “because damages, if any, were as yet inchoate

and speculative.”67 Specifically, “[d]amages were contingent upon whether

[Sklavos’ employer] would interpose the lack of an administrative claim as an

affirmative defense to the wrongful discharge case, and upon whether the

United States District Court would rule in favor of [the employer] if such a

defense was presented.”68 The Court accordingly held that Sklavos’ claim was

timely under KRS 413.245.69

      In sum, Hibbard held that when the cause of action alleged in a legal

malpractice claim is for litigation malpractice a claimant does not have a cause

of action against the attorney until the underlying case becomes final. This is

sound reasoning: because “occurrence date” means “cause of action” under

KRS 413.245, if a claimant cannot allege that they have suffered a legal harm,

that their attorney’s malpractice was the proximate cause of that harm, and

that they have incurred damages, they have no cause of action, and the

occurrence date statute of limitations has not yet been triggered. And Michels

      66 Id.

      67 Id. at 731.

      68 Id.

      69 Id. at 733.

                                       17
simply held that the Hibbard rule applies even if a claimant fires the allegedly

negligent attorney prior to the underlying case becoming final.

      But how does one determine when irrevocable and non-speculative

damages have occurred when a legal malpractice claim is not for litigation

negligence? That is the issue that this Court addressed in Broadbent just five

months after it issued Michels.

      In Broadbent, Smith and Mildred Broadbent hired Bernard Barnett for

estate planning services.70 Based on Barnett’s advice, the Broadbents decided

to convey substantial acreages of farmland to their sons believing that the

manner in which it was conveyed would result in their sons not having to pay

gift taxes.71 The conveyance documents were prepared by Barnett, executed by

the Broadbents, and the next three to four years passed uneventfully.72 But,

after an audit, the IRS determined that the conveyed farmland had been

substantially undervalued.73 As a result, the IRS claimed that the Broadbents

owed $3.5 million in gift taxes, penalties, and interest as of the year 1985.74

Barnett, or some member of his firm, Alagia, Day, Trautwein, & Smith,

represented the Broadbents in the IRS matter from June 1985 until June 30,

1989, when it was undisputed that the representation ended.75

      70 Broadbent, 882 S.W.2d at 122.

      71 Id.

      72 Id.

      73 Id.

      74 Id.

      75 Id. at 123.

                                         18
      Between June 1985 and June 1989, there were extensive negotiations

between the IRS and Barnett’s firm and the firm assured the Broadbents that

the issue would be satisfactorily resolved.76 A letter dated January 25, 1989,

from the firm to the Broadbents regarding its negotiations with the IRS

“brought forcefully to the Broadbents’ attention that a substantial sum of

money would be required by the IRS, but the exact amount remained

uncertain.”77 On June 30, 1989, an attorney with the firm informed the

Broadbents that they would be required to pay a sum in excess of $3 million

dollars in five days’ time.78 The Broadbents ended the representation that day

and hired a different firm which ultimately settled the claim with the IRS for

$1.2 million dollars.79

      The Broadbents filed a professional malpractice claim against Barnett

and the firm on June 18, 1990.80 This date was “less than one year after the

attorney-client relationship was terminated and less than one year after the

final amount due [to the IRS] was determined,” but was “more than one year

after the date of the original deficiency notice . . . and more than one year after

the [firm’s] letter of January 25, 1989, by which the Broadbents were definitely

informed that some payment of money would be required.”81

      76 Id.

      77 Id.

      78 Id.

      79 Id.

      80 Id.

      81 Id.

                                        19
      The trial court ruled that the claim was untimely.82 Applying Graham, it

concluded that the clock began to run on the Broadbents’ claim when they

received the 1985 IRS deficiency notice.83 The trial court further held that the

continuous representation rule as discussed in Gill v. Warren84 was

inapplicable to the facts before it.85 A divided Court of Appeals panel applied

the continuous representation rule, reversed the trial court, and held that the

Broadbents’ claim was timely.86 The Broadbent Court affirmed the Court of

Appeals, but did so on different grounds. Although the Court approved of the

continuous representation rule in dicta,87 it declined to apply it and instead

relied entirely on Hibbard and Michels.88

      The Court discussed that the Hibbard Court “concluded with the view

that only at the end of the appellate process was the client put on notice that

negligence may have occurred and only then could he assert that the damage

was caused by his counsel's error,” and that Michels “was resolved on the

      82 Id.

      83 Id.

      84 751 S.W.2d 33 (Ky. App. 1988) (quoting Wall v. Lewis, 393 N.W.2d 758, 762

(N.D. 1986) (“As applied in legal malpractice actions, the [continuous representation]
rule tolls the statute of limitations or defers accrual of the cause of action while the
attorney continues to represent the client and the representation relates to the same
transaction or subject matter as the allegedly negligent acts.”)).
      85 Broadbent, 882 S.W.2d at 123.

      86 Id. at 124.

      87 Id. at 125 (“These are sound theoretical and practical reasons for adoption of

the continuous representation rule. If this was the decisive issue, appellees would
prevail as their claim was brought within one year of the date appellants’
representation came to an end.”).
      88 Id. at 124.

                                           20
occurrence rule by which the commencement of the statutory period was

postponed until finality of the underlying litigation, when the injury had

become irrevocable and non-speculative.”89 Based on these precedents, the

Court held:

      [T]his case must be decided on the occurrence rule as discussed in
      Michels and urged by appellees, the Broadbents. Until the legal
      harm became fixed and non-speculative, the statute did not begin
      to run. As such, the statute was tolled until the subsequent law
      firm and the IRS settled the claim. This suit was brought on June
      18, 1990, well within one year of this event.90

The Court then stated “[w]e hereby overrule Graham v. Harlin, Parker & Rudloff,

Ky. App., 664 S.W.2d 945 (1983), to the extent it differs herewith” without any

further discussion.91

      The Broadbent Court went on to discuss and dismiss three other dates

that had been presented as possible dates on which the statute of limitations

had been triggered.92 The first was the 1985 IRS notice: the Court held that

date was inapplicable because “the negligence and damages were speculative

and there could have been no discovery because of the continuous

representation by appellants and the presumed reliance of the clients upon the

advice given.”93 The second was the firm’s January 25, 1989, letter to the

Broadbents which the Court held was inapplicable for the same reasons stated

      89 Id. at 125.

      90 Id. at 125-26.

      91 Id. at 126.

      92 Id.

      93 Id.

                                       21
regarding the 1985 IRS notice.94 Finally, the Court held that the date the

Broadbents fired the firm, June 30, 1989, was inapplicable.95 It reasoned that

although “the events of this date were sufficient to trigger commencement of

the statute if there had been an occurrence, the discovery of the negligence was

ineffective as the final result was not yet known.”96 Specifically, until the

damages were fixed by the final compromise with the IRS there was no cause of

action sufficient to trigger the occurrence date statute of limitations.97 This

explanation seems to be inconsistent, as the Court had previously stated that

the Broadbents would have prevailed if application of the continuous

representation rule had been the decisive issue.

      So, Broadbent essentially shoehorned the reasoning of Hibbard and

Michels, which involved claims for litigation negligence, into a case that did not

involve litigation negligence. The consequence of this, whether intended or not,

was that it created a rule that a cause of action cannot accrue, and therefore

the occurrence limitation does not begin to run, in a non-litigation negligence

claim until the claimant can state with certainty the exact dollar amount of

damages they incurred.

      For example, in Meade County Bank v. Wheatley, issued one year after

Broadbent, Meade County Bank hired attorney Stephen Wheatley to prepare a

      94 Id.

      95 Id.

      96 Id.

      97 Id.

                                        22
title opinion for a piece of real estate for which the bank intended to provide a

mortgage loan to a client.98 Wheatley’s title opinion failed to disclose a prior

recorded mortgage which was not discovered by the bank until the client

defaulted on the loan.99 Afterwards, in May 1991, an appraisal of the property

revealed to the bank that the property’s value was less than the secured claims

on it.100 In June 1992, the bank bought the property pursuant to a foreclosure

sale requiring it to satisfy the prior mortgage in the amount of $80,000.101 The

bank filed a malpractice claim against Wheatley in October 1992.102 This

Court held that the case was “legally indistinguishable” from Broadbent, and

that the bank’s claim was timely filed:

      In the present case, the time allowed began to run as of the date of
      the foreclosure sale. Prior to that date, [the bank] had only a fear
      that [it] would suffer a loss on the property. [Its] fear was not
      realized as damages until the sale of the property in June of 1992.
      At that time, what was merely probable became fact, and thus
      commenced the running of the statute. The May 1991, appraisal
      which showed the property's value as being substantially less than
      the debts against it, was irrelevant as to certainty of damages. At
      that point, appellant was merely made aware that it might have
      insufficient collateral on its loan. There was no certainty of
      damages, as is required by Broadbent.103

Notably, Special Justice Levin dissented in Wheatley and argued that the

appraisal indicating that the value of the property was substantially less than

      98 910 S.W.2d 233, 234 (Ky. 1995).

      99 Id.

      100 Id.

      101 Id.

      102 Id.

      103 Id. at 235.

                                           23
its outstanding debt combined with the bank’s knowledge that its debt was

secondary to a prior debt “certainly gave the bank sufficient knowledge of its

non-speculative damage and revealed more than the ‘mere probability of

damages.’”104

      The glaring problem with Broadbent’s analysis of how to determine when

damages are irrevocable and non-speculative sufficient for an accrual of a

cause of action for non-litigation legal malpractice is that it is plainly

inconsistent with Kentucky law and caused KRS 413.245 to be interpreted in a

different manner depending on whether the claim was for non-litigation legal

malpractice or some other form of professional malpractice. These problems

were put on display several years later in Zurich.

      In Zurich, the Estill County Board of Education hired J.E. Black, PLLC

and James Black to provide geo-technical engineering services for the

construction of a middle school that was completed in August 1998.105 By

April 5, 1999, the Board discovered damage to the school caused by “the rising

of the earth beneath the building.”106 The Board filed a claim with its

insurance company, Zurich, and Zurich filed a professional malpractice against

Black as the Board’s subrogee on May 21, 2001.107 In the opinion, the U.S.

District Court for the Eastern District of Kentucky addressed Black’s motion to

      104 Id.

      105 180 F. Supp. 2d at 891.

      106 Id.

      107 Id.

                                         24
dismiss Zurich’s claim as untimely under KRS 413.245 and applicable

Kentucky decisional law.108

      Black argued that the clock began ticking on the Board’s malpractice

claim on the date that the damage to the school’s floor was discovered, while

the Board argued, citing Broadbent, Michels, and Wheatley,109 that the clock

did not begin until its damages were “fixed and non-speculative.”110 The court

addressed the issue as follows:

      The issue, then, is whether the damage to the middle school
      noticed by plaintiff on or about April 5, 1999 may be said to be
      “fixed and non-speculative.” Though the meaning of this language
      is anything but clear, this much is certain: the court of appeals
      could not have intended these words to be interpreted as plaintiff
      has suggested. This is so because, if plaintiff's interpretation is
      accepted, the limitations period for professional negligence
      actions would be effectively tolled until damages could be
      specified as an ascertainable sum certain. This, of course, is not
      the law.

      With respect, plaintiff overstates the degree to which—under
      Kentucky law—damages must be defined in professional negligence
      claims. Whatever it means, “fixed and non-speculative” does
      not mean that damages, to trigger the initiation of the
      limitations period, must be translatable into a specified dollar
      amount. Kentucky law has never required as much[.]

      [. . .]

      Judging from its brief, plaintiff has interpreted “fixed and non-
      speculative” to be a quantitative requirement—in other words,

      108 Id. at 893.

      109 The Board cited an unpublished Court of Appeals case, In re Ky. Cent. Life

Ins. Co., 2001 WL 726781 (Ky. App., June 29, 2001), but the Zurich Court noted that
the case “provides a succinct summary and synthesis of Kentucky’s professional
negligence case law[,]” including Broadbent, Michels, and Wheatley. See Zurich, 180 F.
Supp. 2d at 893 fn. 3.
      110 Id. at 893.

                                         25
      plaintiff cites this language in support of the proposition that a
      professional negligence cause of action does not accrue until a
      would-be plaintiff understands or should reasonably understand
      the full extent of his damages. Read in context, however, the
      phrase is more properly interpreted as tolling the limitations
      period for professional negligence claims until plaintiff is
      certain that damages will indeed flow from defendant's
      negligent act.111

The court held that “the Board did know of damage on April 5, 1999. It was

not a ‘mere probability’ that the Board would suffer damage; rather, the

damage had already been done.”112 The court accordingly granted Black’s

motion for summary judgment.113

      Nevertheless, following Zurich, this Court once again applied the

Broadbent analysis in Pedigo v. Breen.114 In that case, Cynthia Pedigo

consulted with Michael Breen concerning a possible defective product claim

against a breast implant manufacturer, but Breen declined to represent her.115

Pedigo alleged that she brought her medical records with her to the

consultation, and that Breen subsequently lost the records which precluded

her from participating in a multi-district litigation (MDL) class action against

      111 Id. (emphasis added).

      112 Id.

      113 Id.  The ruling in Zurich was affirmed by the Sixth Circuit Court of Appeals.
Estill Cnty. Bd. of Educ. v. Zurich Ins. Co., 84 Fed. Appx. 516, 519 (6th Cir. 2003) (“We
think that the Kentucky statute requires that in order for the limitations period to
commence, the plaintiff must be aware that he has in fact been damaged by the
defendant's negligence. The statute does not require that the plaintiff be aware of the
precise dollar amount or even the exact extent of the damage.”).
      114 169 S.W.3d 831 (Ky. 2004).

      115 Id. at 831-32.

                                           26
the manufacturers.116 Pedigo “participated in several medical examinations

accumulating thousands of dollars in fees” to replace her original medical

records, but was informed that she still would not receive a settlement offer in

the class action because she did not have her original records.117 She

ultimately settled her claim with the manufacturer of her implants for an

amount that was five times less than what she would have received had she

participated in the MDL class action suit.118 The Pedigo Court held that the

claim for legal malpractice did not accrue until Pedigo settled her claim with

the manufacturer:

      Although the alleged loss of the records may have prevented
      Appellant from qualifying for the MDL class action, damages at
      that time were merely speculative and measurable only by the cost
      of attempting to reconstruct her medical records so that the breast
      implant case could proceed. While the reconstruction of the

      medical records was necessary for [Pedigo] to proceed and costs
      were incurred, there was no accounting for the value of the
      underlying case because it was ongoing. In other words, the cost
      of the records did not include the compensation Appellant claims
      to have lost because she failed to qualify for the MDL class action
      by timely production of her original medical records. Not until
      Appellant reached a non-MDL settlement with [the manufacturer]
      on June 30, 1998, was she able to ascertain the damage
      sustained. As in [Broadbent] and other precedent, [Pedigo’s]
      damages did not become fixed until the date of her settlement in
      the underlying case for which she had sought representation.119

      116 Id. at 832.

      117 Id.

      118 Id.

      119 Id. at 834.

                                       27
      Following Pedigo, in Matherly, supra, this Court applied the Zurich

analysis to a professional, non-legal malpractice claim. In that case, Matherly

Land Surveying, Inc., an engineering/land surveying firm, contracted with

Gardiner Park Development, LLC to provide services related to the construction

of a subdivision.120 After Matherly had performed work on the project for a

year, Gardiner became dissatisfied and ultimately fired Matherly and had to

hire an engineering firm and a land surveying firm to complete the work.121

After a failed attempt at mediation in December 1999, Gardiner filed suit

against Matherly, which the trial court dismissed as untimely.122

      On appeal, this Court rejected the argument that the suit was timely

because Gardiner’s damages were not yet irrevocable and non-speculative.123

Citing Zurich, the Matherly Court stated that “[s]uch a standard would toll the

statute of limitations until it was known with absolute certainty the amount of

damages flowing from an incident,”124 and that “Kentucky law has never

required a specified dollar amount be known before the statute of limitations

can run.”125 It then concluded:

      Potential damages were apparent when [Matherly] walked off the
      job and certainly apparent when the Gardiner Entities attempted
      mediation with [Matherly] in December 1999. At this time the
      Gardiner Entities produced a document which stated all of

      120 Matherly, 230 S.W.3d at 587.

      121 Id. at 588.

      122 Id.

      123 Id. at 590.

      124 Id. at 591.

      125 Id.

                                         28
      “Gardiner Design's Known Damages” and drafted a letter which
      stated that “Only within the last month have all of the problems
      and deficiencies with MLS's design been uncovered and fixed.” It is
      obvious from the record that the Gardiner Entities were well aware
      that [Matherly’s] actions caused them damages and had a good
      idea what those damages were in 1999.126

      The final case in this saga is Saalwaechter, supra. In July 2007, Bill

Saalwaechter hired attorney Thomas Carroll to represent him in a transaction

to buy a pawn shop and surrounding real estate.127 Saalwaechter believed

under the terms of the documents surrounding the deal that he would own

both the pawn shop and the surrounding land.128 After some time

Saalwaechter discovered that Carroll himself had purchased the shop; set up a

new company, Evansville Pawn LLC; and had obtained a pawn license.129

However, Carroll had procured the license on behalf of another individual who

was paying Carroll a monthly fee for the business.130 Such “straw licensing”

schemes are illegal in Indiana, where the pawn shop was located, and the

Indiana Department of Financial Institutions (DFI) refused to renew Carroll’s

pawn license and ordered him to wind up the business.131

      At that point, Saalwaechter created his own entity, Fares Pawn LLC, and

he and Carroll agreed that Fares Pawn would take possession of Evansville

      126 Id.

      127 525 S.W.3d at 102.

      128 Id.

      129 Id.

      130 Id.

      131 Id.

                                       29
Pawn’s inventory and liquidate its outstanding pawns.132 DFI initially denied

Saalwaechter’s application for a pawn license, which he appealed.133 After

some negotiations with DFI regarding who would manage the store, DFI

approved his application in early 2010.134

      In April 2010, Saalwaechter filed a claim for professional malpractice

against Carroll, which was dismissed in April 2014 for failure to prosecute.135

In February 2015, Saalwaechter moved to set aside the dismissal, which was

denied.136 In May 2015, Saalwaechter filed a second action against Carroll

asserting the same claims and factual predicate as the April 2010 action, the

only difference was Saalwaechter’s reference to his equal protection federal

litigation against DFI based on its initial failure to grant his application for a

license, which was initiated in October 2011.137 The trial court granted

Carroll’s motion for summary judgment to dismiss the claim as untimely.138 In

doing so, it rejected Saalwaechter’s argument that his damages did not become

fixed and non-speculative until July 14, 2014, when the federal circuit court

denied his appeal in his equal protection suit against DFI.139

      132 Id. at 102-03.

      133 Id. at 103.

      134 Id.

      135 Id.

      136 Id.

      137 Id. at 103-04.

      138 Id. at 104.

      139 Id.

                                         30
      Before the Court of Appeals, Saalwaechter argued that the trial court

failed to properly apply Broadbent and Wheatley, and again asserted that,

although he suffered losses in 2007 and 2008, his damages did not become

fixed and nonspeculative until the federal court denied his appeal in his suit

against DFI.140 The Court of Appeals disagreed, noting the language from

Zurich that was later adopted by Matherly, that “fixed and non-speculative does

not mean that damages, to trigger the initiation of the limitations period, must

be translatable into a specified dollar amount.”141 Moreover, the court pointed

out that “unlike some of the cases cited by Saalwaechter, there is no litigation

negligence, underlying continuing negotiation, or lawsuit in which Carroll was

involved[,]” and that “Saalwaechter's subsequent lawsuit against DFI in 2011

for denying him a pawn license was collateral to, and wholly independent of,

his action against Carroll.”142 It concluded that

      [b]y the very language of Saalwaechter's first complaint in 2010, he
      was aware that he had been injured by Carroll's alleged negligent

      conduct. At that point, even if he may not have known of the full
      extent of his damages in terms of the precise dollar amount, the
      fact of his injury was certainly “irrevocable” and “non-
      speculative.”143

The court therefore held that Saalwaechter’s 2015 complaint was untimely.144

      140 Id. at 105.

      141 Id. at 106.

      142 Id. at 106-07.

      143 Id. at 107.

      144 Id.

                                       31
D. Broadbent and its progeny are hereby overruled. Wolfe’s professional
   malpractice claim against Kimmel was not timely filed.

      Based on the foregoing, the state of our KRS 413.245 jurisprudence as it

currently stands is clearly inconsistent. Under Broadbent, Wheatley, and

Pedigo, if a professional malpractice claim is for non-litigation negligence, the

point at which the occurrence date begins to run is the date on which the

claimant knows with certainty the exact monetary amount of damages they

have incurred. Whereas under Matherly, and by extension Zurich, if a claim for

professional malpractice is not for legal malpractice, damages are considered

irrevocable and non-speculative when the claimant is certain that damages will

indeed flow from the defendant’s negligent act even if the exact dollar amount

is unknown. And Saalwaechter, though a bit of an oddity due to its facts, is

nevertheless significant because it applied Matherly and Zurich to a non-

litigation legal malpractice claim to determine when damages became

irrevocable and non-speculative.

      Not surprisingly, this inconsistency has led to the parties in the case now

before us to argue different positions that are both currently supported by the

cases they cite. Wolfe argues under Broadbent and Pedigo that because

Kimmel committed non-litigation malpractice that caused her to be sued by

Lampley, her damages could not be irrevocable and non-speculative until

Lampley’s suit against her became final on July 17, 2017, when she and

Lampley entered into a settlement agreement.145

      145 Wolfe also argues that Saalwaechter does not apply because in that case,

Carroll’s alleged malpractice had nothing to do with Saalwaechter’s subsequent suit
                                         32
      In contrast, Kimmel contends that even the Pedigo Court stated that “[a]

professional negligence claim does not accrue until there has been a negligent

act and until reasonably ascertainable damages are incurred.”146 He further

asserts under Matherly and Zurich that the occurrence date statute of

limitations began to run no later than August 2016 because at that point Wolfe

knew she had been injured by Kimmel’s malpractice, had already incurred

damages, and was certain that more damages would indeed result.

Specifically, Wolfe’s own complaint against Kimmel stated that she sustained

emotional injuries on August 1, 2016, when she received the cease-and-desist

letter from GenCare’s attorney, and that she was sued by Lampley and

GenCare on August 19, 2016, for which she incurred economic injury by

paying attorney’s fees for both her own attorney and a different attorney to

represent GenCare’s former employees. In addition, Kimmel’s advice was so

blatantly incorrect that Farmer advised Wolfe during an August 2016 meeting

to settle the case as soon as possible because she would surely lose if the case

went to trial and would end up owing Lampley and GenCare a substantial

amount of money.

      While it is true that Matherly and Zurich did not involve a legal

malpractice claim, and therefore could theoretically be distinguished, this

against DFI for denying his pawn license. We agree that the facts of Saalwaechter
make it inapplicable here.
      146 169 S.W.3d at 833 (emphasis added) (citing Faris v. Stone, 103 S.W.3d 1 (Ky.

2003) (holding that a CR 60.02 motion will not toll the statute of limitations in KRS
413.245)).

                                           33
Court concludes that the problems with the Broadbent line of cases are too

blatant to ignore. As previously mentioned, Kentucky law has never required

that damages be ascertainable in a specific dollar amount to state a cause of

action for professional negligence. Accordingly, to require that a claimant

know an exact dollar amount of damages before a cause of action for non-

litigation legal malpractice can accrue—i.e., for the occurrence date to be

triggered under KRS 413.245—is plainly wrong.

      Additionally, KRS 413.245 by its plain language does not in any way

distinguish between legal malpractice claims and other professional

malpractice claims. It says that civil actions arising out of “any act or omission

in rendering, or failing to render, professional services” shall be brought

within one year of the occurrence date or one year from the date of

discovery.147 Yet because of Broadbent and its progeny, a judicial overwrite

was created where non-litigation legal professional malpractice claims are

treated very differently than non-legal professional malpractice claims. For

claims that do not arise out of legal malpractice, damages are considered

irrevocable and non-speculative when the claimant is certain that damages will

indeed flow from the defendant’s negligence. Whereas, for non-litigation legal

malpractice claims, damages are considered irrevocable and non-speculative

when the claimant can state with certainty the exact dollar amount of damages

      147 KRS 413.245 (emphasis added).

                                          34
they incurred due to the defendant’s negligence. In practice, this disparate

treatment provides non-litigation legal malpractice claimants much more time

before the occurrence date of KRS 413.245 begins to run on their claims.

      Based on the foregoing, we hereby overrule Broadbent and its progeny,

including Wheatley and Pedigo, insofar as they hold that damages are

irrevocable and non-speculative when a claimant knows the exact dollar

amount in damages they incurred due to a defendant’s negligence. Instead,

and to establish more uniformity in our professional malpractice cases, we

reiterate that for a non-litigation, legal malpractice claim, the occurrence date

limitation begins to run when negligence and damages have both occurred.148

But we now hold that for such a claim damages are considered irrevocable and

non-speculative when the claimant is reasonably certain that damages will

indeed flow from the defendant’s negligence.

      In this case, the one-year statute of limitations began running on Wolfe’s

claim against Kimmel no later than August 2016 when she was advised by

another attorney of Kimmel’s malpractice. By that time, negligence and

damages had both occurred sufficient to trigger the occurrence date limitation.

It was undisputed that Kimmel and Wolfe had an attorney client relationship;

Kimmel neglected his duty to exercise ordinary care when he provided her

      148 See Michels, 869 S.W.2d at 730 (“A cause of action is deemed to accrue in

Kentucky where negligence and damages have both occurred[.]”).

                                         35
incorrect advice surrounding her exit from GenCare; and his negligence was

the proximate cause of Wolfe’s legal injuries. Wolfe’s damages were also

irrevocable and non-speculative in August 2016: according to her complaint

against Kimmel, she suffered emotional distress for which she sought

compensation when she received the August 1 cease-and-desist letter; and she

was sued by Lampley and GenCare on August 19, which she incurred expenses

and emotional distress in defending. Even assuming arguendo that the

foregoing damages were insufficient for a cause of action to accrue, Farmer

informed her in no uncertain terms in August 2016 that she needed to settle

the case as soon as possible because she would lose at trial and owe Lampley

and GenCare a substantial amount of money. She was therefore reasonably

certain at that time that damages would indeed flow from Kimmel’s negligence.

The discovery date limitation is not applicable in this case because there are no

circumstances suggesting that the cause of action was not reasonably

discoverable.

      Therefore, because the occurrence date limitation began to run in August

2016, and Wolfe did not file her malpractice claim until February 2018, her

malpractice claim against Kimmel is time barred.

                              III.   CONCLUSION

      Based on the foregoing, we affirm the Court of Appeals on slightly

different grounds. Wolfe’s professional malpractice claim against Kimmel was

not timely filed under KRS 413.245.

                                       36
      VanMeter, C.J.; Bisig, Conley, Keller, Lambert, and Thompson, JJ,

sitting. All concur. Nickell, J., not sitting.

COUNSEL FOR APPELLANT:

John Saoirse Friend
Friend Law, PSC

COUNSEL FOR APPELLEES, JOE KIMMEL:

William Alexander Hoback
Mark Squires Fenzel
McBrayer PLLC

                                          37