Court Opinion

ID: 9664448
Source: CourtListenerOpinion
Date Created: 2023-08-24 00:19:04.517721+00
Date Added: 2024-06-11T18:15:01.690699
License: Public Domain

SHIRLEY S. ABRAHAMSON, J.
(dissenting). I agree with the holding of the majority opinion that the discovery rule is applicable for determining the accrual of the cause of action of attorney malpractice. I part company with the majority opinion in its determination as a matter of law that the plaintiff discovered or with reasonable diligence should have discovered his injury upon receipt of the October 13, 1981 letter. I do not believe that the plaintiffs discovery of his injury can be decided as a matter of law on summary judgment under the facts of this case.
Discovery Rule. Application of statutes of limitation to legal malpractice actions presents difficult *169problems. Courts have approached the problem of accrual of statutes of limitations in legal malpractice actions in a number of different ways. Courts have viewed the cause of action as accruing, for example, when the negligent act occurred (occurrence rule), when the client suffered injury (damage rule), when the attorney-client relationship terminated, or when the client discovered the essential facts constituting a cause of action (discovery rule).
The trend in the cases is away from the harsh occurrence or damage rule, in which the statute of limitations starts to run on the date of the negligent act or of the injury, regardless of the client's knowledge of the act or injury, toward the discovery rule. Under the discovery rule, the statute of limitations starts to run when the plaintiff has actual or imputed knowledge of the facts constituting a cause of action for malpractice, that is, "when the plaintiff has actual or imputed knowledge of the attorney's act or omission, the wrongful nature, and the fact of injury . . .." 2 R.E. Mallen & J.M. Smith, Legal Malpractice sec. 18.15, p. 137 (3d ed. 1989).
I agree with the majority that "a claim for relief does not accrue until the potential plaintiff knows of or, in the exercise of reasonable diligence, should have discovered his injury, its nature, its cause, and the identity of the allegedly responsible defendant.' " Majority op. at 160 (citations omitted).
This court applied the "damage rule" in Boehm v. Wheeler, 65 Wis. 2d 668, 676-677, 223 N.W.2d 536 (1974), refusing to adopt the discovery rule or a theory of "continuous representation."1 Determining the date of *170injury under the damage rule can be troubling, as Boehm, the majority opinion, and the other dissenting opinion demonstrate. "An attorney's error may create only the potential for injury. The determinative inquiry is whether the realization of that potential for damage depends upon whether future events will occur, or whether future events, certain to occur, will disclose whether there is in fact present injury. The latter situation raises a question of tolling in a discovery rule jurisdiction." 2 R.E. Mallen & J.M. Smith, Legal Malpractice sec. 18.11, p. 107.
The other dissenting opinion contends that in this case actual damage did not occur until the plaintiff was forced to pay attorney's fees to defend the action on the promissory note. Though some decisions support this interpretation of when damage occurs, I believe that such problems can best be handled under the discovery rule. I agree with the authors of a treatise on legal malpractice who, when discussing a case involving a real estate transaction, conclude, "Although the defect in title can be rationalized upon the contingency that there is no actual damage until a challenge is made, the better rationale is the lack of discovery. A client aware of the defect would undoubtedly have a viable legal malpractice action notwithstanding the absence of an adverse claimant." 2 R.E. Mallen and J.M. Smith, Legal Malpractice, sec. 18.11, p. 107, n.27.
After Boehm, this court applied the discovery rule in certain tort claims. Under the discovery rule, the tort claim accrues on the date "the injury is discovered or with reasonable diligence should be discovered, whichever occurs first." Hansen v. A.H. Robins, Inc., 113 Wis. 2d 550, 560, 335 N.W.2d 578 (1983).
*171The case at bar is the first case in which this court applies the discovery rule to a legal malpractice claim. I join the majority in holding that the discovery rule is applicable in legal malpractice cases.
Summary Judgment. The majority opinion concludes that the plaintiff in this case discovered his injury, as a matter of law, when he received a letter from an attorney approximately two months after the real estate transaction was to have been completed.2 I conclude that the question of whether the plaintiff knew or should have known of the injury on receipt of the letter *172is a question of fact for the fact-finder, not a question of law for the court. I would therefore deny summary judgment and remand for a determination of the date of discovery of the injury by the fact-finder.
Summary judgment is appropriate when only an issue of law is involved. Summary judgment is not appropriate when an issue for a fact-finder exists. We set forth the general rules for summary judgment in Grams v. Boss, 97 Wis. 2d 332, 338-339, 294 N.W.2d 473 (1981). Summary judgment is appropriate when there is no disputed issue of material fact. If material facts are disputed, if there are undisputed facts from which reasonable alternative inferences may be drawn, or if the material presented on the motion is subject to conflicting interpretations or reasonable people might differ as to its significance, summary judgment is improper.
The discovery rule sets forth a "reasonable person" standard (an objective standard). Applying the legal standard to the facts, even undisputed facts, for purposes of the discovery rule is ordinarily an issue of fact for the fact-finder.3 Whether the plaintiff knew or a reasonable person should have known of the injury may be decided as a matter of law when a court can say that there is only one reasonable conclusion to be drawn from the undisputed facts.4
*173The question, then, in this case is whether reasonable persons could draw competing reasonable inferences or conclusions regarding the date of plaintiffs discovery.
I conclude that reasonable people can reach different conclusions from this record about when the plaintiff knew or should have known of his injury. The fact-finder could conclude from the evidence relating to the original transaction that the plaintiff believed the transaction was void and that he had no liability because he could not get financing.5 The fact-finder could conclude that the October 13, 1981, letter was unclear and would not necessarily have disabused the plaintiff of the idea that he had no liability. The fact-finder might think that attorneys, and others, sometimes threaten legal action *174when they have no intention of following through on their threat. A reasonable person might have thought this a "dunning" letter, sent in the hopes that it would induce the plaintiff to come up with the money, but that it represented an empty threat. The fact that nothing happened on the date of the threatened foreclosure — plaintiff was not sued on the note until four years after the letter — might have confirmed the plaintiffs reasonable belief that the transaction was void. The fact-finder might also decide that since a copy of the letter was sent to the plaintiffs attorney, it was reasonable for the plaintiff to conclude that if there was any substance to the claim his attorney would have notified him. Or the fact-finder might have found that the plaintiff failed to exercise reasonable diligence in investigating the letter and discovering his liability. The question, however, is not what this court thinks a fact-finder would decide, but whether the issue of discovery should go to the fact-finder in this case. I conclude it should.
For these reasons, I would deny summary judgment in this case and remand the cause.

Only limited reliance can be placed on Boehm, because the Hansen case expressly overruled "all cases holding that tort claims accrue at the time of the negligent act or injury." Hansen v. A.H. Robins, Inc., 113 Wis. 2d 550, 560, 335 N.W.2d 578 (1983).
*170For a discussion of the continuous representation rule, see 2 R.E. Mallen & J.M. Smith, Legal Malpractice sec. 18.12.

The entire letter is as follows:
October 13, 1981
Mr. Loren Hennekens Star Route Sarona, WI 54870
RE: Mortgage and Note to Gene Crotteau Dear Mr. Hennekens:
As you are well aware, I represent Mr. Crotteau in this transaction. In exchange for a deed to the landfill property, you gave Mr. Crotteau a note for $225,000 payable on or before August 16, 1981. That note is secured by a mortgage on the real estate which he deeded you.
This payment is now almost two months past due, and you have done nothing to satisfy this obligation. As you well know, Mr. Crot-teau's situation with regard to this particular real estate is really delicate. Unless you can pay this obligation in full within the next ten days or two weeks, it is very doubtful that this real estate will be available for your use at all.
In order to protect his own position in this matter, I must recommend that Mr. Crotteau commence a foreclosure action against you on the note and mortgage which you signed. This we will proceed to do if we have not received payment from you by October 27.
Very truly yours, Timothy M. Doyle
*172TMD:phs cc: Gene Crotteau Mike Luckterhand Donald Hoerl

See, e.g., Spitler v. Dean, 148 Wis. 2d 630, 638, 436 N.W.2d 308 (1989), where we concluded that the issue of whether the plaintiff exercised reasonable diligence to discover the identity of the defendant was for the fact-finder and remanded the case.

I believe that determining the date of accrual of the statute *173of limitations under the discovery rule in a negligence action presents the same division of responsibility between circuit court, this court and the fact-finder as the determination of negligence in the underlying action. While the standard of conduct required in a certain situation is determined by the court, it is the function of the fact-finder to apply that standard to the facts of the case to determine whether the person conformed to the standard. Prosser & Keeton, The Law of Torts, sec. 37 (5th ed. 1984) p. 235. However, if the court decides there is only one reasonable conclusion to be drawn regarding whether a person's conduct conformed to the standard, the court may take the issue for the fact-finder and decide the question as a matter of law. Restatement (2d) of Torts, sec. 328B, Comment on clause (d), p. 154, sec. 328C, Comment on clause (b), pp. 155-156 (1965).
For a discussion of summary judgment and discovery rule, see 2 R.E. Mallen & J.M. Smith, Legal Malpractice, pp. 138, 692.

The plaintiff signed a separate agreement at the same time he signed the promissory note, providing additional payments for Crotteau in exchange for studies he was to do on the suitability of the property for a landfill. The agreement stated that "In. the event that the sale is not consummated, the property reverts to Crotteau, and this Agreement shall be null and void."