Jankowski v. Taylor, Bishop & Lee
| Decision Date | 22 July 1980 |
| Docket Number | No. 59434,59434 |
| Parties | JANKOWSKI et al. v. TAYLOR, BISHOP & LEE et al. |
| Court | Georgia Court of Appeals |
W. Jan Jankowski, for appellants.
Wallace E. Harrell, William R. Waldrop, Brunswick, for appellees.
This case involves a legal malpractice action brought by the former client, individually and in behalf of others, against his former legal counsel based upon the following uncontroverted facts.
In the Spring of 1972, certain shareholders of the corporation contacted legal counsel concerning a potential lawsuit against one Euley T. Morgan, an officer of said corporation. An oral agreement of representation was reached, and on May 31, 1972, plaintiff Jankowski forwarded to one of the defendant attorneys a list of the shareholders pursuant to a conversation had between plaintiff Jankowski and another of the shareholders. On June 1, 1972, a letter was written to one of these shareholders which confirmed a portion of the agreement, that is, to advise him that the legal firm of attorneys (now a professional corporation) "(p)ursuant to our conversation" would represent the stockholders in their suit against "individuals in Jesup, Georgia for negligence . . . " The terms of representation were as shown in the written letter that a "retainer fee would be $1500.00 to file a suit . . . (and the) . . . fee would be one-third (1/3) of any amounts recovered." The letter further stated that the "$1500 would be credited to any amount that we recover against the Defendants."
The retainer fee was then paid by several stockholders in various amounts. On October 26, 1972, suit was filed in the name of Joseph J. Lahiff as a member of the class "on behalf of himself and all others similarly situated." The suit was against Euley P. Morgan as a director and officer serving in the capacity of president, alleging that he had been "guilty of malfeasance, misfeasance and fraud as principal officer and a director in said corporation by fraudulently eliminating the corporation's interest in . . . (certain) . . . property and acquiring the same himself." Judgment was sought in the sum of $350,000.
Euley P. Morgan answered, admitting jurisdiction, his capacity as a director and officer and the existence of a class of persons consisting of the stockholders, the option to purchase certain property described in the petition, but otherwise denied the claim, contending that the option of the corporation had expired after the stockholders of record failed to exercise the option by purchasing the property which would have required additional cash necessary to exercise said option and admitting further that he, after the expiration of that option, did, while acting as an individual and in no way acting as an officer or director of or joint venturer with said corporation, purchase said property, taking legal title in his own name. By counterclaim Morgan sought judgment in the form of setoffs against plaintiff Joseph J. Lahiff and also Walter J. Jankowski, purportedly a member of the class of persons arising out of certain notes for which he had been called upon to pay.
No further action was taken with reference to this suit until January 28, 1974, when the case was called for trial, and counsel failed to announce ready, having requested another lawyer to do so who failed to announce ready; and the trial court dismissed the action "without prejudice" for failure of the plaintiff to prosecute same.
On July 10, 1975, upon learning that the suit had been dismissed, counsel for the plaintiffs refiled the suit in the name of Joseph J. Lahiff and Walter J. Jankowski "on behalf of themselves and all others similarly situated" against the same defendant, Euley P. Morgan. Whereupon Morgan answered this suit virtually the same as in the dismissed action, adding thereto that the action is barred by the statute of limitation found in Code Ann. § 22-714(c) (Ga.L.1968, pp. 565, 640) which requires that the relief sought must be brought within "four years from the time the cause of action accrued." However, the counterclaim in this instance was in addition to and more elaborate than in the first instance.
On September 4, 1975, the motion of defendant Morgan to dismiss the action came on for a hearing, and same was sustained, and plaintiffs' complaint was dismissed; but the court's order stated that "(t)his order does not constitute a dismissal of the counterclaim filed by the defendant and against the plaintiffs." Sometime in October, 1976, counsel (defendant law firm herein) were relieved of their duties and other counsel employed.
Whereupon, on April 9, 1979, Walter J. Jankowski individually and on behalf of the subject corporation, brought the action for legal malpractice against his former legal counsel, individually and as a professional corporation. It is alleged therein that counsel were negligent in allowing the first action to be dismissed, in failing to properly pursue said cause of action in a reasonable and diligent manner and in thereafter attempting to refile said suit after the expiration of the applicable four year statute of limitation, which negligence directly and proximately barred the plaintiff Jankowski and the other shareholders of the corporation from pursuing their otherwise valid and provable claims against Morgan, thereby damaging them in the sum of $350,000. They further contended that a confidential relationship existed between the plaintiffs and defendants who failed to inform the plaintiffs of their negligence in allowing the statute of limitation to expire, said defendants have concealed said act of negligence and in refiling the case against Morgan thereby naming Jankowski as a party plaintiff, they submitted plaintiff Jankowski to the jurisdiction of the trial court, exposing him to a counterclaim requiring him to defend the claim, although false and malicious, thereby causing him to incur reasonable attorney fees and expenses necessitated by defendants' negligence. Plaintiffs sought judgment against the defendants jointly and severally in the amount of $350,000 plus interest on behalf of the corporation, and in the amount of $4,844.96 plus interest for the plaintiff Jankowski, and reasonable attorney fees for counsel representing plaintiff Jankowski herein.
Defendants moved to dismiss because the action was barred by...
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