As this blog has mentioned before, one of the key requirements of any legal malpractice action is harm. What this means to a client who has received deficient legal services is there may be nothing but a broken promise after these services. Legal malpractice actions are finely tuned which is very nicely demonstrated in LVI Environmental Services (LVI) v. Duane Morris LLP(DM), 004498 AprilTerm 2008, 2010 WL 3398702, 12 Pa. D & C 5th457 (Pa. Com. Pl. 2010).
LVI was a sub-contractor working in Philadelphia on a project with Delta, another sub-contractor. LVI was to perform certain demolition work according to the contract, where Delta was to complete asbestos removal on the project. Within the agreement was a delay for damages clause, which is commonly found in construction agreements. It essentially provided that if one contractor is late in finishing, then they are not responsible for monetary damages, but rather would adjust the schedule. Also included in the contract was a clause which provided LVI exclusive access to certain floors, which Delta did not do. LVI alleged that the reason for lack of access was delay by Delta, forcing LVI to do their assigned work in a more expensive, less efficient matter.
DM was hired in relation to the underlying contract case against Delta. When DM filed the lawsuit, the case against Delta for breach of contract was dismissed. After dismissal, the parties settled on the remaining claims. DM filed a notice of appeal concerning the initial decision, but neglected to timely serve the statement of issues on the trial judge. LVI then filed a legal malpractice suit against DM for legal malpractice. LVI's expert opined that the dismissal would have been reversed on appeal, thus not serving the statement of issues in a timely fashion caused damages to LVI.
Because of legal malpractice jurisprudence, the court needed to determine as a matter of law whether LVI would have won on appeal concerning the delay for damages clause. Thus, if the decision would have been sustained on appeal, then LVI would suffer no damages. Without damages, there is no claim, which is why LVI's attorney was forced into this argument. The court then evaluated no damages for delay clauses in general. Damages will only be recovered in situations where the facts show either a claim for fraud in the inducement of the contract, mutual mistake of fact, or where the delay was outside of the defined class of delays. LVI did not assert any of these situations, thus they could not fit within these theories.
There is also a case which allows a no damages for delay clause to be avoided where an owner by an unwarranted positive act interferes with completion or where the owner neglects to complete an essential element of the contract. The forced delay by workers of other contractors is not sufficient to meet this standard. This sort of situation is usually limited to where one contractor's fraud interferes with completion of another contractor's work.
The court then reasoned that allowing avoidance of the clause in a case where the subcontractors fell behind and then attempted to work together to catch up does not fit the policy reasons for the clause. If it were to be allowed, then the exception to the clause would swallow the rule for enforcement of the clause in the first place. Thus, the Court believed the trial court correctly dismissed the action, and the case would have been sustained on appeal.
This is an interesting case not only in the malpractice arena, but in the sense that the trial court reviewed the actions of a peer court, essentially sitting as a horizontal appeal. It is also interesting to note the court does not say that failing to file the statement of issues was not legal malpractice. The case is more akin to non-actionable legal malpractice. Without damages, no tortious action is available. Thus, the Plaintiff client who has received deficient legal services must prove the case within a case, and suffer damages as a result of the lawyer's malpractice. The client who has a bad experience with a lawyer faces an uphill battle in proving there case. If there is one idea to be pulled from this case, it is that just because legal malpractice has been committed, it does not mean there is any legal action which can be taken to remedy that service.