Technical Packaging, Inc. v. Hanchett

• Decision Date: 26 September 2008
• Docket Number: No. 2D06-3851.,2D06-3851.
• Citation: Technical Packaging, Inc. v. Hanchett, 992 So.2d 309 (Fla. App. 2008)
• Parties: TECHNICAL PACKAGING, INC., Appellant, v. Richard HANCHETT and Trenam, Kemker, Scharf, Barkin, Frye, O'Neill & Mullis, P.A., Appellees.
• Court: Florida District Court of Appeals

992 So.2d 309

TECHNICAL PACKAGING, INC., Appellant, v.Richard HANCHETT and Trenam, Kemker, Scharf, Barkin, Frye, O'Neill & Mullis, P.A., Appellees.

No. 2D06-3851.

District Court of Appeal of Florida, Second District.

September 26, 2008.

Rehearing Denied September 26, 2008.

Warren R. Trazenfeld, P.A., Miami, and Patrice A. Talisman of Hersch & Talisman, P.A., Coconut Grove, for Appellant.

F. Wallace Pope, Jr., of Johnson, Pope, Bokor, Ruppel & Burns, LLP, Clearwater, for Appellees.

FARNELL, CROCKETT, Associate Senior Judge.

Technical Packaging, Inc.("Technical Packaging" or "Technical"), sued its former attorney Richard Hanchett and Hanchett's firm, Trenam, Kemker, Scharf, Barkin, Frye, O'Neill & Mullis, P.A. ("Trenam"; collectively, "Hanchett/Trenam"), for legal malpractice.The trial court granted Hanchett/Trenam's motion for summary judgment, ruling that Hanchett/Trenam had prevailed on its defense of abandonment.We reverse.

Background

Technical Packaging sold cellophane cigar tubes.In the late 1990s its cellophane supplier was UCB Films, Inc.("UCB").Technical ordered cellophane from UCB on approximately thirty-five occasions during this period, with each order reflected in its own set of documents.At some point Technical's customers began complaining about defects in cigar tubes that had not existed when Technical was purchasing cellophane from its previous supplier.Technical claimed that UCB's allegedly defective cellophane was delivered between December 1996 and May 1998.¹Technical lost a significant amount of money.Trenam, which had had a long-term attorney-client relationship with Technical, assisted Technical in defending claims made by its customers; Hanchett was assigned to represent Technical.In March 2000, Technical consulted with Trenam about the possibility of suing UCB on a contingency-fee basis.After Trenam declined to undertake this representation in the summer of 2001, Technical hired another law firm and filed a complaint against UCB on March 3, 2003.UCB removed the suit to the federal Middle District of Florida.Technical's complaint recited eight causes of action, only one of which—breach of contract—forms the basis of the issue in the instant appeal.UCB pleaded statute of limitations as a defense and prevailed on its motion for summary judgment, with the court ruling that a four-year statute applied to all of Technical's claims, making the lawsuit untimely.The four-year period applied to the breach-of-contract claim because, the court ruled, the Technical-UCB sales agreements were oral contracts.See§ 95.11(3)(k), Fla. Stat.(2002)(providing that "[a] legal or equitable action on a contract . . . not founded on a written instrument, including an action for the sale and delivery of goods" entails a four-year limitations period).Technical did not appeal the judgment.

The gist of the present malpractice action is that during the consultations leading to Trenam's declining to represent Technical Packaging in a lawsuit against UCB, Hanchett allegedly gave Technical incorrect dates for the termination of limitations periods; as a result, Technical's March 2003 suit against UCB was untimely filed.For its part, Hanchett/Trenam raised several defenses, including abandonment—that is, that Technical, by not appealing the adverse judgment in the underlying lawsuit and winning a reversal, waived any malpractice claims against Hanchett/Trenam.Specifically, Hanchett/Trenam argued below and argue here that the federal district court erred in ruling that the agreements for the sale of cellophane from UCB to Technical were oral contracts, thus entailing four-year limitations periods.Hanchett/Trenam contend (as Technical did in the underlying lawsuit) that the sales agreements were written contracts entailing five-year limitations periods, see§ 95.11(2)(b), and that Technical should have prosecuted an appeal based on that legal theory.Relying on the defense of abandonment, Hanchett/Trenam moved for summary judgment and prevailed on that ground.Technical appeals.

Discussion

This court reviews a final order of summary judgment de novo.SeeVolusia County v. Aberdeen at Ormond Beach, L.P.,760 So.2d 126, 130(Fla.2000).

A movant is entitled to summary judgment "if the pleadings, depositions, answers to interrogatories, admissions, affidavits, and other materials as would be admissible in evidence on file show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."

Estate of Githens v. Bon Secours-Maria Manor Nursing Care Ctr., Inc.,928 So.2d 1272, 1274(Fla. 2d DCA2006)(quotingFla. R. Civ. P. 1.510(c)).Furthermore,

[i]n determining whether a genuine issue of material fact exists, this court must view every possible inference in favor of the party against whom summary judgment has been entered.It is the movant's burden to prove the nonexistence of genuine issues of material fact, and the burden of proving the existence of such issues is not shifted to the opposing party until the movant has successfully met his burden.

Id.(citations and quotation marks omitted).

We begin by noting that the elements of legal malpractice that the plaintiff must prove are: (1) the employment of the attorney, (2) the lawyer's neglect of a reasonable duty, and (3) the attorney's negligence as the proximate cause of loss to the client.Lenahan v. Russell L. Forkey, P.A.,702 So.2d 610, 611(Fla. 4th DCA1997).Further, the Florida Supreme Court in Peat, Marwick, Mitchell & Co. v. Lane,565 So.2d 1323(Fla.1990), pointed out that "[a] clear majority of the district courts have expressly held that a cause of action for legal malpractice does not accrue until the underlying legal proceeding has been completed on appellate review because, until that time, one cannot determine if there was any actionable error by the attorney."Id. at 1325(citations omitted).

If the principle of "complet[ion] on appellate review,"id., were required to be followed literally in all cases, then there would be no question that the trial court's granting of summary judgment to Hanchett/Trenam was correct, given that Technical did not appeal its loss in the underlying lawsuit.However, the generalization has been tempered:

Where a party's loss results from judicial error occasioned by the attorney's curable, nonprejudicial mistake in the conduct of the litigation, and the error would most likely have been corrected on appeal, the cause of action for legal malpractice is abandoned if a final appellate decision is not obtained.Pennsylvania Ins. Guar. Ass'n v. Sikes,590 So.2d 1051(Fla. 3d DCA1991). . . .

. . . .

Our cases should not be read to require every party who suffers a loss and attributes that loss to legal malpractice to obtain a final appellate determination of the underlying case before asserting a claim for legal malpractice.The test for determining when a cause of action for attorney malpractice arises remains when the existence of redressable harm has been established.In some cases, redressable harm caused by errors in the course of litigation can only be determined upon completion of the appellate process.In other cases, the failure to obtain appellate review should not bar an action for malpractice.We are unable to establish a bright-line rule that complete appellate review of the underlying litigation is a condition precedent to every legal malpractice action.To do so would, in many cases, violate the tenet that the law will not require the performance of useless acts.

Segall v. Segall,632 So.2d 76, 78(Fla. 3d DCA1993)(quotation marks and most citations omitted; emphasis added);see alsoHunzinger Constr. Corp. v. Quarles & Brady Gen. P'ship,735 So.2d 589, 595(Fla. 4th DCA1999)("The circumstances in which a client's subsequent actions constitute an abandonment of a legal malpractice claim, as a matter of law, are very narrow. . . .In the instant case, we cannot say, as the court could in [Pennsylvania Ins. Guar. Ass'n v.] Sikes,[590 So.2d 1051(Fla. 3d DCA1991),] that the mistake in the original proceedings would in all likelihood have been corrected on appeal."(internal quotation marks omitted; citations omitted));Eastman v. Flor-Ohio, Ltd.,744 So.2d 499, 504(Fla. 5th DCA1999)("Accordingly, the trial court in this case properly concluded that the park owner did not abandon its right to pursue a claim of legal malpractice against the law firm by voluntarily dismissing its appeal from the adverse judgment in the class action suit because that judgment was not likely to be reversed due to a finding of judicial error relating to the alleged claim of legal malpractice.").

The issue here, then, is whether Hanchett/Trenam could demonstrate under the summary judgment standard that an appeal by Technical of the federal district court's adverse judgment would in all likelihood have resulted in a reversal, with a ruling by the federal appeals court that the statute of limitations on an action for UCB's alleged breach of the Technical-UCB agreements was five years.There is, however, a threshold issue whose resolution, we conclude, largely moots the main issue: whether a reversal with such a ruling would have made any difference to Technical—that is, whether even under a five-year limitations period Technical's underlying lawsuit would have been too late.

The chronology urged by Hanchett/Trenam in support of its position that the federal district court erred is based on a letter from Technical's insurance carrier to Technical's counsel dated January 14, 2000, and stating that no formal claim had yet been made against Technical by its customers.²Hanchett/Trenam theorize that because any damages related to UCB's defective product would have come into existence sometime after this date, when actual complaints would have come in, and because the federal appeals court would have concluded that the...