Legal Malpractice May Come from an Implied Attorney Relationship.

Attorney client relationship may be implied. The North Dakota court has weighed in with yet another case holding that an attorney may find him/her self involved as an attorney without knowing it!  The Court reprised that "It is not necessary that there be an express contract or payment of fees; an attorney-client relationship may be implied from the conduct of the parties. See Stormon v. Weiss, 65 N.W.2d 475, 520 (N.D. 1954); Robertson, 536 N.E.2d at 348; Keegan, 519 N.W.2d at 611." That is the majority rule in the United States.

In the case of Moen v. Thomas, 2001 ND 110, 628 N.W.2d 325, the court did it again ---  found an implied attorney-client relationship. 

In the 2003 case of Disciplinary Board v. Giese, 2003 ND 82. the North Dakota court did it again ---  found an implied attorney-client relationship.  This time they laid out a good summary of the law not only for North Dakota, but in words that are good for most states, as follows.

[¶17] In Disciplinary Bd. v. McKechnie, 2003 ND 22, ¶ 19, 656 N.W.2d 661 (quoting ABA/BNA Lawyers' Manual on Professional Conduct, at 31:101 (2002)), we said, "the lawyer-client relationship begins when the client acknowledges the lawyer's capacity to act in his behalf and the lawyer agrees to act for the benefit and under the control of the client." The existence of an attorney-client relationship does not depend on an express contract or the payment of fees, and may be implied from the parties' conduct. McKechnie, at ¶ 19. An attorney-client relationship is established when a party seeks and receives advice and assistance from an attorney on matters pertinent to the legal profession. Matter of Petrie, 742 P.2d 796, 800 (Ariz. 1987). See 7 Am. Jur. 2d Attorneys at Law § 136 (1997). The existence of an attorney-client relationship turns largely on the client's subjective belief it exists and looks to the nature of the work performed and to the circumstances under which confidences are divulged. Petrie, at 800-01; Louisiana State Bar Ass'n v. Bosworth, 481 So.2d 567, 571 (La. 1986); Matter of McGlothlen, 663 P.2d 1330, 1334 (Wash. 1983). . . . . The existence of an attorney-client relationship is a question of fact. Moen v. Thomas, 2001 ND 110, ¶ 13, 628 N.W.2d 325.

Here is a similar Texas line of cases. A reasonable attorney knows there are times when a the relationship may be implied or expected by the person to whom the attorney is talking. Cf., Perez v. Kirk & Carrigan, 822 S.W.2d 261, 265-66 (Tex. App.Corpus Christi 1991, writ denied) ("An agreement to form an attorney-client relationship may be implied from the conduct of the parties. . . . the relationship does not depend upon the payment of a fee, but may exist as a result of rendering services gratuitously."); Parker v. Carnahan, 772 S.W.2d 151, 157 (Tex. App.Texarkana 1989, writ denied); Parker v. Carnahan, 772 S.W.2d 151, 157 (Tex. App.Texarkana 1989, writ denied);("An attorney-client relationship may be implied from the conduct of the parties .

Privity is not a defense for failure to prevent misunderstanding of existence of lawyer being attorney for the claimed client.  When a non-client sues an attorney for the legal malpractice of negligently failing to advise the non-client that the attorney is not representing the non-client, when the circumstances would lead the non-client to believe the attorney has undertaken the representation. A duty to the non-client does exist. See, e.g., Cantu v. Butron, 921 S.W.2d 344, 351 (Tex. App.Corpus Christi 1996, writ denied); Byrd v. Woodruff, 891 S.W.2d 689, 700 (Tex. App.Dallas 1994, writ denied); Kotzur v. Kelly, 791 S.W.2d 254, 257-58 (Tex. App.Corpus Christi 1990, no writ); Parker v. Carnahan, 772 S.W.2d 151, 157 (Tex. App.Texarkana 1989, writ denied);(" . . . further, an attorney may be held negligent when he fails to advise a party that he is not representing them on a case when the circumstances lead the party to believe that the attorney is representing them.").

Privity is Not Always Required for Duty to Arise Not to Negligently Misrepresent. Generally, a person who is not in privity with an attorney cannot sue for the attorney's negligence. Cf.,  McCamish, Martin, Brown, & Loeffler v. F.E. Appling Interests, 991 S.W.2d 787, 792 (Tex. 1999). But there is a duty that runs to non-clients, and thus, an attorney may be subject to a negligent misrepresentation claim even if there is no legal malpractice claim. Therefore, because of the duty that runs to non-clients, it is possible for a non-client to have a claim for negligent misrepresentation against an attorney even if he/she may lack standing to sue otherwise for the attorney's negligent acts in or out or court.. McCamish, Martin, Brown, & Loeffler v. F.E. Appling Interests, 991 S.W.2d 787, 792 (Tex. 1999). The Texas Supreme Court limits the duty to non-clients to situations in which the attorney is aware of the non-client and intends for the non-client to rely on the information provided. Id. at 794 (cause of action is available only when information is transferred by an attorney to a known party for a known purpose) This duty to non-clients is similar to the duty of accountants giving financial information to their client which the accountant knows will be given to third party, but is not limited to that situation.

The Moen case also has a concurring opinion that lays out some of this basic sources of law for researchers on when an attorney may be liable for legal malpractice to a non-client.  The concurring opinion does not go as far as the Texas McCamish case.

When does the Statute of Limitations Run? Larson v. Norkot Manufacturing, Inc., 002 ND 175  is a good discussion of when the statute of limitations begins to run on a legal malpractice case --- when there is both (a) a problem of discovery and a(2)  problem of when damages or injury occurs. This is the second time that this case has been before the North Dakota Supreme Court. All the parties were represented by experienced legal malpractice counsel, and the case considers all the aspects involved..  The court starts by stating that for a cause of action for an attorney's legal malpractice, there must be damages to the client proximately caused by the attorney's breach of a duty to the client; the statute of limitations does not begin to run until the client has incurred some damages from the alleged malpractice; and the statute of limitations is tolled until the client knows, or with reasonable diligence should know, of the injury, its cause, and the defendant attorney's possible negligence.  The court then splits on the question of defining those times that trigger the statute.  If you have a problem like this, read this case.