Lawyer Sued By Non-Client Over Statute of Limitations “Advice”

Plaintiff talked to lawyer (later the defendant) about a potential car wreck case.  The lawyer allegedly gave the plaintiff wrong information about the statute of limitations applicable to the claim.  Plaintiff’s car wreck case was dismissed as time-barred.

Plaintiff sued the lawyer for negligent misrepresentation.  Lawyer said that he never represented client and, indeed, client never alleged an attorney-client relationship. 

The Colorado Court of Appeals allowed the case against the lawyer to proceed under the negligent misrepresentation theory as set forth Section 552 of the Restatement (Second) of Torts (1977), saying that "in Colorado a claim based on negligent misrepresentation is independent of any principle of contract law and that privity is not required."

The Colorado court also cited Comment e to the Restatement (Third) of the Law Governing Lawyers Section 15 with approval.  That comment states as follows:

When a prospective client and a lawyer discuss the possibility of representation, the lawyer might comment on such matters as whether the person has a promising claim or defense, whether the lawyer is appropriate for the matter in question, whether conflicts of interest exist and if so how they might be dealt with, the time within which action must be taken and, if the representation does not proceed, what other lawyer might represent the prospective client. Prospective clients might rely on such advice, and lawyers therefore must use reasonable care in rendering it.

The case was permitted to proceed because

plaintiffs alleged in their complaint that (1) "at all pertinent times, Defendant Allen was acting within the course and scope of her employment with Defendant Katherine Allen, P.C."; (2) "[a] reasonably careful attorney, having and using that degree of knowledge and skill of attorneys practicing law in November 2003," would have told them that the statute of limitations on their negligence and negligence per se claims against the other driver was three years, not five years; and (3) such an attorney would have told them that they could have commenced an action against the other driver before they settled any available workers’ compensation claim.

Our Tennessee readers will recall that Tennessee has adopted  Section 552 of the Restatement (Second) of Torts (1977).

The case is Steele v. Allen, No. 07CA2163 (Colo. Ct. App. Feb. 19, 2009).  Read the opinion here.

Lesson:  Don’t speculate on statutes of limitations when discussing cases with potential clients.  If you don’t know, look it up.  If you still don’t know, tell the client that you don’t know.  If the deadline is uncertain, e.g. the discovery rule applies, etc., advise the client of that and give the most conservative date the statute expires, confirming your thoughts in writing.  Tell the client that they should seek the advice of a lawyer as soon as possible so that an appropriate factual investigation can be undertaken and the discovery date ascertained with greater certainty.