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Analyzing the Economic Viability of a Legal Malpractice Claim in Missouri

Purpose. Assist attorneys with early case evaluationFactors to consider:MeritsCostsDamagesCostly endeavorDamages must be evaluated at the outset. Elements of a Claim. Case law is well settledFox v. WhiteFour Elements:Existence of A-C relationshipNegligence or breach of contractProximat

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Analyzing the Economic Viability of a Legal Malpractice Claim in Missouri

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    1. Analyzing the Economic Viability of a Legal Malpractice Claim in Missouri Kevin Jones

    2. Purpose Assist attorneys with early case evaluation Factors to consider: Merits Costs Damages Costly endeavor Damages must be evaluated at the outset

    3. Elements of a Claim Case law is well settled Fox v. White Four Elements: Existence of A-C relationship Negligence or breach of contract Proximate cause DAMAGES

    4. Damages to who? May recover for damages to non-clients Donahue v. Shugart, Thompson, Kilroy, P.C. Client must show specific intent Exception: Johnson v. Sandler, Balkin, Hellman & Weinstein Standing of non-client determined on case-by-case basis: Existence of specific intent Foreseeability Degree of harm How proximate? Burden on legal profession

    5. What Theory of Recovery? Damages dependant on theory of recover Multiple theories: Negligence Breach of Contract Breach of Fiduciary Duty Other intentional torts (IIED) Must elect ONE theory to submit to jury See Ozark Air Lines, Inc. v. Valley Oil Co., L.L.C.

    6. What Theory of Recovery? Professional Negligence Punitive damages!!! Direct damages dependant on “CWAC” Pre-judgment interest Case Law Fox v. White, 215 S.W.3d 257 (Mo. App. W.D. 2007). Sharp v. Robberson, 495 S.W.2d 394 (Mo. Banc 1973).

    7. What Theory of Recovery? Breach of Contract Nominal Damages Hanna v. Darr, 154 S.W.3d 2 (Mo. App. E.D. 2004) Special Damages Shirley’s Realty, Inc. v. Hunt, 160 S.W.3d 804 (Mo. App. W.D. 2005). Benefit of Bargain Damages Kincaid Enterprises, Inc. v. Porter, 812 S.W.2d 892 (Mo. App. W.D. 1991) Lost profits BMK Corp. v. Clayton Corp., 226 S.W.3d 179 (Mo. App. E.D. 2007). Post-judgment interest RSMo. § 408.040

    8. What Theory of Recovery? Breach of Fiduciary Duty Difficult to establish Intentional misconduct Opens door to plethora of damages Amounts to “constructive fraud” Opens door to fraud damages Attorney’s fees Punitives Benefit of bargain Pre-judgment interest Case Law Klemme v. Best, 941 S.W.2d 493 (Mo. 1997).

    9. Direct Damages Necessary to prove under negligence theory Measured by damages sought in the “case within the case” Necessary to investigate TWO cases: Underlying action where malpractice was allegedly committed Present action where recovery for malpractice is sought Case Law Stockman v. Frank, 239 S.W.3d 650 (Mo. App. E.D. 2007) Steward v. Goetz, 945 S.W.2d 520 (Mo. App. E.D. 1997)

    10. Interest – Breach of Contract Post-judgment interest – RSMo. § 408.040(1) Interest from date of judgment to date or payment Interest = greater of 9% or amount in contract No pre-judgment interest

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