A judge of the Probate and Family Court ruled in December 2004
that a premarital agreement (made in November 1998, when the
parties to it were in their 70s!) was invalid. Disgruntled about
that, the former husband filed in 2006 a Superior Court malpractice
claim against the lawyer who represented him in the agreement's
creation. The claim against the lawyer was filed within three years
of the Probate and Family Court's invalidation of the agreement.
G.L. c. 260, sec. 4 (three year statute of limitations applicable
to legal malpractice actions sounding in either contract or tort).
Was the claim timely filed?
No -- at least not in the case of Allenby v. DeWitt, 82
Mass. App. Ct. 1117 (Oct. 17, 2012) (Unpublished disposition
pursuant to App. Ct. Rule 1:28). The statute of limitations in a
case such as this "begins to run at the point when the plaintiff
knows or has reason to know that he has suffered appreciable harm"
(i.e. "'injury, loss or detriment' that is capable of being
measured or perceived."). Id., quoting from Kennedy v.
Goffstein, 62 Mass. App. Ct. 230, 232-233 (2004).
Harm occurred when the wife acquired in 1998 a title
interest in one of the husband's properties that was greater than
the limited interest (i.e. contingent life estate only) that he
intended for her to have under the premarital agreement. The
husband knew (or should have known) of the harm when the
real estate tax bills he received for 1998 showed his wife as the
property's owner.
As for the premarital agreement itself, the court's decision was
that the husband-plaintiff "was on notice, at the outset,
after speaking with the [lawyer]-defendant, that the agreement was
defective and unenforceable." The wife had shown the
husband a letter written to her by her lawyer in April 1999, which
stated that the agreement was unenforceable. The husband's own
divorce lawyer, in 2002 (four years before the malpractice claim
was filed), cautioned him "in no uncertain terms" that he "was not
covered from A-Z" under the agreement. In effect, therefore, the
actual "harm" occurred on the date of the marriage, when the
defectiveness of the agreement allowed the wife to acquire rights
under G.L. c. 208, sec. 34.
MARRIAGE = 'SOME DAMAGE'
Family lawyers who know about it like the case of Antone v.
Mirviss, 720 N.W.2d 331 (Minn. 2006). In it, the Minnesota
Supreme Court decided that a legal malpractice action against the
lawyer who drafted a prenuptial agreement accrued on the date of
the husband-plaintiff's marriage, and not when, almost seventeen
years later, a portion of the husband's supposedly protected
premarital property was assigned to his spouse by a divorce
judgment.
"As soon as [husband] was married, in the absence of an
effective [premarital] agreement, the appreciation [of his
premarital property] was no longer protected from [wife's] claims
and [husband] lost the right to unilaterally change this
consequence." Id. at 337. The "immediate and irremediable"
consequence of the marriage -- "a point of no return" -- was that
husband "was left without the nonmarital property protections he
sought to obtain through the antenuptial agreement drafted by
Mirviss." Id.
This exposure "was an injury that resulted in some
damage sufficient" to begin the running of the statute of
limitations on a claim of negligence relating to Mirviss's work on
the agreement. Id. 337-338. "[T]he inability to calculate
the precise damage at the time of the marriage does not preclude
the running of the statute of limitations." Id. The
husband's legal malpractice claim was time-barred -- it was not
filed within six-years (the limitation period applicable in
Minnesota) of the date of marriage.
A similar result was reached in Radovich v.
Locke-Padden, 41 Cal.Rptr.2d 573 (Cal. 6th C.A. 1995). When
the husband sued the lawyer who drafted a 1957 prenuptial agreement
in which the husband waived all community property interests, the
Court held that "actual and immediate injury" occurred upon
execution of the agreement, and not when the wife died in 1991, as
the husband alleged. Id. at 589-590. Because the agreement
was effective upon execution and acted immediately to deprive the
husband of any community property interests from the start of the
marriage, the husband's execution of the agreement in 1957 "was
sufficient empirical certainty of actual injury" to trigger the
running of the applicable limitations period. "[A]s an abstract
proposition the search for the first 'actual injury' should be
easy: The first injury of any kind to the plaintiff, attributable
to the defendant attorney's malfeasance or nonfeasance, should
suffice." Radovich, supra at 587.
ONLY 'POTENTIAL HARM'
In Allenby, the court rejected the husband-plaintiff's
argument that the statute of limitations did not begin to run until
December 2004, when the Probate and Family Court invalidated the
premarital agreement. Unlikely as it may be that the Supreme
Judicial Court would adopt a rule so clear as the one adopted by
Minnesota in Antone, the Allenby case does show
that a variety of events occurring upon or after the date of a
marriage may render a malpractice claim arising out of a premarital
agreement time-barred before the agreement is ever the subject of
litigation at the time of a divorce.
Referencing those earlier points in time at which Allenby was
actually alerted to the defectiveness of the agreement,
the court reasoned that Allenby's was "not [a] situation" like the
one in Eck v. Kellem, 51 Mass. App. Ct. 850, 853 (2001).
In Eck, the lawyer drafted a real estate purchase and sale
agreement and assured his client (the seller) that it would protect
him from liability on any future Chapter 21E claims by the buyer,
but that buyer later sued and successfully obtained a judgment
against the client on just such a claim. The court held legal
malpractice action did not accrue until the judgment
entered in the buyer's favor -- "Whether, in fact, Kellem was
negligent in the preparation of the sale agreement had to await the
outcome of the [buyer's] suit: until that time it could not be
said that Eck suffered any cognizable harm." (emphasis added)
See Spilios v. Cohen, 38 Mass. App. Ct. 338, 339-340
(plaintiff's attorney in a divorce case refused to accept a
settlement offer the plaintiff said should be accepted: held,
because it was not possible to determine whether there was
legal malpractice until the judge's decision was announced,
the statute of limitations did not begin to run until that time)
(emphasis added).
In hindsight, according to the way the Allenby decision
reads, for the malpractice action to have been timely, Allenby had
to file it within three years of the point in 1998 (long before the
divorce action) at which real estate tax bills made him aware of
his wife's claim of ownership to the property in question; or
within three years of the point in 1999 that the wife showed him
her attorney's letter stating that the agreement was unenforceable.
This is good news for DeWitt, the draftsman, but what damages would
Allenby have sought to recover from DeWitt in an action filed in
1999 before it could be known what disposition would be made of
property in a divorce action that had not yet been filed?
Complications of this sort are what the courts processed in the
matter of Robbat v. Gordon, 771 So.2d 631, 636 (Fla. 4th
DCA 2000). A marked distinction was drawn between "knowledge of
actual harm from legal malpractice and knowledge of potential harm.
The former begins the limitations period; the later does not." This
"means that the limitations period on claims of legal malpractice
should not commence until it is reasonably clear that the client
has actually suffered some damage from legal advice or services."
Id.
Attorney Gordon advised the husband, Robbat, in 1986 that his
1978 prenuptial agreement (executed in Massachusetts), and the
postnuptial agreement that he and his wife signed in 1986, both
would be enforceable to protect the husband's then new home in
Florida from claims by the wife. In 1991, in the parties' divorce
proceeding, a judge found that both agreements were unenforceable,
and the value of the husband's home was equally divided. On the
husband's appeal, the Court of Appeal (in 1994) agreed that the
Massachusetts prenuptial agreement was enforceable and that it,
regardless of the later postnuptial agreement, governed claims
relating the Florida home purchased in 1986.
In 1996, within two years of the appellate decision vacating the
1991 divorce judgment, the husband sued Gordon for legal
malpractice. He claimed that he was damaged by improper preparation
of the 1986 postnuptial agreement and by the fact that the wife had
placed "beyond his reach" the substantial sums that had been
awarded to her in the original divorce judgment. Id. at
633. Gordon argued that the statute of limitations began to run at
the time of the 1991 divorce judgment, and a trial judge granted
his motion for summary judgment on the grounds that the husband's
1996 legal malpractice action was barred by Florida's two-year
statute of limitations. Id. at 634.
Reversing, the Court of Appeal reasoned that "knowledge of an
adverse decision by a lower tribunal is not sufficient to start the
running of the statute of limitations in a transactional
malpractice claim where the client chooses to defend the actions of
the [attorney] defendant on appeal, since to require the client to
pursue the malpractice claim while the at the same time defending
the professional's actions on appeal would place the client 'in the
wholly untenable position of having to take directly contrary
positions in [the] two actions.'" Id. at 636-637, quoting
Peat, Marwick, Mitchell & Co. v. Lane, 565 So.2d 1323,
1326 (Fla. 1990). Because Robbat defended Gordon's advice -- that
the Massachusetts prenuptial agreement was valid -- throughout his
appeal from the divorce judgment, "the statute of limitations did
not begin to run until after this court rendered its decision on
appeal; until that time, there was no redressable harm."
Id. at 637. Robbat's 1996 malpractice action was
determined to be timely filed.
CONCLUSION
The conclusion that can be drawn from the above is that there is
no definitive conclusion that be drawn. The purpose of a statute of
limitations is to provide a potential "defendant" (like Attorney
DeWitt) some repose after the mere passage of time. Koe v.
Mercer, 450 Mass. 97 (2007)("'[Statutes of limitations are]
"vital to the welfare of society . . . They promote repose by
giving security and stability to human affairs."'"), quoting
Franklin v. Albert, 381 Mass. 611, 618 (1980), quoting
Wood v. Carpenter, 101 U.S. 135, 139 (1897). The
Allenby case, like Minnesota's Antone, suggests
that Massachusetts courts are open to declaring time-barred
malpractice claims that that arise out the drafting of a premarital
agreement many, many years (even decades) earlier. Cases like
Florida's Robbat, however, suggest that the safest course
for lawyers that spent some portions of their careers drafting
premarital agreements is to have done so in Minnesota rather than
Florida!
KEVIN M. CORR is a partner at Lee,
Rivers & Corr LLP, where his practice is predominantly family
law. He has a particular interest in litigation involving contested
premarital and marital agreements. He is chairing an MCLE program
on the subject in Jan. 2013.