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When Should Conduct be Punished?

In legal malpractice cases, the issue of damages often arises. How much did an attorney's mistake cost, if anything at all? Usually, courts will base damages on a calculation of the mistake. However, at times conduct can become so outrageous that Courts will find grounds exist for a punitive fee to be appropriate. Theise v. Carroll, 2011 WL 1584448 (M.D. PA 2011) examines the Pennsylvania law on punitive damages.

The case centered on Plaintiff Linda Theise. In 2006, she was in a serious car accident. In June of 2007, she retained the legal services of the Carrolls with regard to the lawsuit concerning the accident. Under the law of Pennsylvania, there was a 2 year statute of limitations for suit based on the accident. On October 10, 2008, after the statute of limitations had expires, the defendants sent a letter to the insurance company responsible for the other driver in the accident. The insurance carries refused to pay Theise because the statute had expired. In response, the Carrolls told the insurance company that suit would be filed in New York, where the statute of limitations is 3 years. The Carrolls also contacted their malpractice insurance provider concerning the missed deadline. The malpractice carrier told the Carrols NOT to file suit in New York, but the Carrolls ignored the advice, filing a frivolous complaint in New York on March 25, 2009. On May 27, 2009, the New York court issued a transfer order, which moved the case to Pennsylvania. The Pennsylvania court granted judgment against the plaintiffs based on the statute of limitations on September 9, 2009. Theise then filed a complaint against the Carrolls alleging legal malpractice and punitive damages.

The Carrolls attempted to dismiss the punitive damages claim based on insufficiency. The Court disagreed with that assessment. The Court noted that Pennsylvania law allows punitive damages to be awarded in legal malpractice cases where the defendant has engaged in conduct that is outrageous because of the defendant's evil motive or reckless indifference to the rights of others. The Court qualified the standard by citing the Pennsylvania Supreme Court which holds punitive damages are penal in nature and thus only proper in case where there is willful, wanton, or reckless conduct. The purpose of the damages is to deter others from acting in a similar manner. Additionally, the Pennsylvania Supreme Court has held that the state of mind of the defendant is a vital part of determining punitive damages. The act or failure to act must be intentional, reckless, or malicious.

The Court then looked at some of the actions undertaken by the defendants in filing this case. The plaintiffs alleged they did not authorize the acts of the defendant in filing a lawsuit in New York, nor did the defendants notify them of such actions. The plaintiffs also alleged that there was a failure by the defendants to file a motion in opposition to the transfer order from the New York court. The court believed this evidence was enough to support a punitive damages claim to be part of the trial.

From the perspective of a wronged client, the most important part of this case is that compensatory damages are not the sole remedy. Especially in cases where an attorney acts against wishes, a client may have a claim for punitive damages. As far as the attorney is concerned, the acts taken in regards to representation should be carefully thought out, and a client should always be consulted. In this case, the attorneys would have saved time and money had they simply revealed the truth to Mrs. Theise as opposed to trying to cover up their mistake.

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