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When is Enough Enough? A Claim of Legal Malpractice in the Course of Settlement Negotiations

11/15/19

By: Jake Loken

The Georgia Court of Appeals confirmed in Smiley v. Blasingame, Burch, Garrard & Ashley, P.C., decided on October 30, 2019, that when a claim of malpractice occurs regarding settlement negotiations, an alleged breach is immaterial if a plaintiff cannot prove that the breach resulted in damages to the plaintiff. Said another way, even if a breach can be proven, a plaintiff must still prove that the plaintiff could have received a greater settlement but for the breach.
The Smiley plaintiffs claimed their attorneys committed legal malpractice in the course of settling the plaintiffs’ underlying lawsuit which involved claims related to an implanted medical device. In negotiating potential settlements, the attorneys allegedly settled with the medical device manufacturer on terms different than those posed to plaintiffs.
At the trial court level, the court noted that although the plaintiffs “‘presented enough evidence for a question of fact as to whether the actions of [the attorneys], if taken as true, violated a legal standard of care,’ their claim still did not survive . . . because the plaintiffs have not shown any damages proximately caused by the breach.”
In discussing this point further, the Court of Appeals found that the plaintiffs had “not cited to any issue of fact indicating that they would have received a larger settlement if their attorneys had not breached their duty towards them. Further, the [plaintiffs’] assertions that they should have received additional compensation are merely speculative.” And, as we know, “[a] legal malpractice claim cannot be based upon speculation and conjecture.”
Notably, the Court of Appeals found that “damages cannot be proven by comparing the [plaintiffs] settlement with the settlement received by the other . . . plaintiffs [also allegedly injured by the same medical device].” In reaching this conclusion, the Court of Appeals used the words of the plaintiffs’ expert to state that in the case of multiple settlements regarding the same underlying medical device, “every case has its own facts . . . [and] that other considerations played into each plaintiff’s settlement, including venue, judgment collectability, and potential appeal rounds.”
If you have any questions or would like more information, please contact Jake Loken at jloken@fmglaw.com.