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Frederick v. Wallerich

Supreme Court of Minnesota

February 7, 2018

Joseph W. Frederick, Appellant,
Kay L. Wallerich, et al., Respondents.

         Office of Appellate Courts

          Patrick H. O'Neill, Jr., Stephanie L. Chandler, Larson King, LLP, Saint Paul, Minnesota, for appellant.

          Kay Nord Hunt, Barry A. O'Neil, Bryan R. Feldhaus, Lommen Abdo, P.A., Minneapolis, Minnesota, for respondents.

          Michael C. McCarthy, Erica A. Holzer, Maslon LLP, Minneapolis, Minnesota, for amicus curiae Minnesota State Bar Association.

          Anne M. Honsa, Honsa & Associates, P.A., Minneapolis, Minnesota; David L. Olson, Edina, Minnesota; Mary Catherine Lauhead, Law Offices of Mary Catherine Lauhead, Saint Paul, Minnesota; and Michael D. Dittberner, Linder, Dittberner, Bryant & Winter Ltd., Edina, Minnesota, for amicus curiae Minnesota Chapter of the American Academy of Matrimonial Lawyers.

          William L. Davidson, Thomas D. Jensen, Lind, Jensen, Sullivan & Peterson, P.A., Minneapolis, Minnesota, for amicus curiae Professional Liability Defense Federation.


         1. Multiple acts by the same lawyer may give rise to separate claims for legal malpractice. To determine when multiple acts by the same lawyer are independent acts of negligence, a fact-specific approach should be used that may include weighing whether the plaintiff's position was significantly worsened, whether the subsequent act involved the same type of conduct, whether the acts occurred at different times and during different transactions, whether the subsequent act was connected by a causal link to the first, and whether the subsequent act explicitly relied on the continued validity of the prior work.

         2. The loss of an opportunity to control one's assets satisfies the "some damage" requirement for accrual of a legal-malpractice claim.

         Reversed and remanded.


          HUDSON, JUSTICE.

         At issue is whether appellant Joseph Frederick has filed a timely legal-malpractice claim under Minn. Stat. § 541.05, subd. 1(5) (2016). Frederick's attorney, respondent Kay Wallerich, prepared an antenuptial agreement for Frederick and his then-fiancée, Cynthia Gatliff, in 2006. The agreement did not include the statutorily required witness signatures, however, thus making it unenforceable. Frederick and Gatliff were married the next day. One year later, Wallerich drafted a will for Frederick, which incorporated the antenuptial agreement by reference. According to the will, Frederick did not leave any assets to Gatliff because the antenuptial agreement already specified the portion of his assets that she was to receive upon his death. When Gatliff filed for divorce after 6 years of marriage, she alleged that the antenuptial agreement was invalid because it lacked the requisite witness signatures.

         Later that year, Frederick commenced a lawsuit against Wallerich for legal malpractice. Although the invalid execution of the antenuptial agreement fell outside of the 6-year limitations period for malpractice claims, Frederick alleged that subsequent representations by Wallerich that the antenuptial agreement was valid-most significantly when Wallerich drafted his will 1 year later-were separate legal-malpractice claims that each triggered their own statute of limitations periods. Wallerich moved for judgment on the pleadings, which the district court granted, determining that all of Frederick's claims related to the antenuptial agreement were untimely filed. The court of appeals affirmed. Because we hold that Frederick has sufficiently alleged that Wallerich's will drafting formed the basis for a separate malpractice claim within the limitations period, we reverse and remand to the district court for further proceedings.


         On appeal from the district court's judgment on the pleadings, we must take all allegations of the complaint as true. Walsh v. U.S. Bank, N.A., 851 N.W.2d 598, 606 (Minn. 2014). We therefore rely principally on the allegations of the complaint for the factual record.

         Beginning in 2006, Frederick retained Farrish Johnson Law Office for various family law and estate matters. In September 2006, Frederick consulted with an attorney at Farrish Johnson Law Office, Wallerich, to draft an antenuptial agreement before his wedding to Gatliff. Frederick's intent was that Gatliff would not receive his assets, or the appreciation therefrom, if they divorced. Frederick and Gatliff signed the agreement on September 28, 2006, but the witness lines were left blank, making the agreement unenforceable. See Minn. Stat. § 519.11, subd. 2 (2016) ("Antenuptial . . . contracts . . . shall be in writing, executed in the presence of two witnesses and acknowledged by the parties . . . ."). Frederick and Gatliff married the next day, on September 29, 2006.

         One year later, on September 12, 2007, Frederick again consulted Wallerich, this time to discuss the planning and drafting of a new will. Wallerich affirmatively assured Frederick at this meeting that the previously executed antenuptial agreement was valid and enforceable. The terms of Frederick's will show that he intended to incorporate the antenuptial agreement by reference, and implicitly relied on its validity in crafting the provisions of the will: "I have entered into an Antenuptial Agreement prior to executing this Will. I have intentionally omitted my spouse from taking under this Will as we have provided for bequests at our death by separate written instrument dated September 28, 2006."[1] On September 28, 2007, Frederick's will was executed.

         Frederick continued to retain Wallerich for various estate and family law matters, including in January 2008, when Gatliff signed a consent to Frederick's will, acknowledging the enforceability of the antenuptial agreement incorporated within, saying "I have read and understand the provisions of the Antenuptial Agreement dated September 28, 2006, which make provision for me to consent to th[is] will." Further, Frederick consulted Wallerich in April 2010 and July 2011, when he executed codicils to his will.

         In January 2013, Gatliff filed for divorce. She argued that the antenuptial agreement was unenforceable due to a lack of witness signatures. On September 10, 2013, while the dissolution proceeding was pending, Frederick commenced a legal-malpractice suit against Wallerich. Wallerich filed an answer and moved for judgment on the pleadings, arguing that Frederick's claims were untimely filed because more than 6 years had passed since the attempted execution of the antenuptial agreement. See Minn. Stat. § 541.05, subd. 1(5) (establishing a 6-year statute of limitations for negligence claims). Before Frederick filed his response, his legal-malpractice action was stayed pending resolution of the dissolution proceedings.

         In the dissolution case, the district court ruled that the antenuptial agreement was unenforceable.[2] As a result of this ruling, Frederick and Gatliff stipulated to a division of marital property in which Frederick would give Gatliff a share of his assets, taking into account the appreciation of the assets during their marriage. After resolution of the dissolution proceeding, the court lifted the stay of Frederick's legal-malpractice action against Wallerich. Responding to Wallerich's pre-stay motion for judgment on the pleadings, Frederick disagreed that his action was untimely. Rather, he asserted that Wallerich committed several acts of legal malpractice, with independent damages attributable to each. Specifically, Frederick argued that the September 2007 visits with Wallerich to draft a new will gave rise to an entirely new cause of action for legal malpractice apart from the mistakes made during the 2006 drafting of the antenuptial agreement. Thus, Frederick argued, his September 2013 complaint was filed within the 6-year limitations period.

         In September 2015, the district court granted Wallerich's motion for judgment on the pleadings, dismissing all of Frederick's claims under the statute of limitations. In an unpublished opinion, the court of appeals affirmed. Frederick v. Wallerich, No. A15-2052, 2016 WL 4068931, at *1 (Minn.App. Aug. 1, 2016). Relying on Antone v. Mirviss, 720 N.W.2d 331 (Minn. 2006), the court of appeals reasoned that the statute of limitations begins to run when the cause of action accrues, which is "when the plaintiff can allege sufficient facts to survive a motion to dismiss for failure to state a claim upon which relief can be granted." Frederick, 2016 WL 4068931, at *2 (quoting Antone, 720 N.W.2d at 335). The court noted that Minnesota follows the "some damage" rule, in which a "cause of action accrues when 'some' damage has occurred as a result of the alleged malpractice, " with "some damage" defined as "any compensable damage." Id. (quoting Antone, 720 N.W.2d at 335-36). Tracking Antone, the court determined that Frederick's legal-malpractice cause of action accrued on the date of his marriage, because at that moment he became subject to "some damage." Id. at *3. Because Frederick married on September 29, 2006, his claim filed on September 10, 2013, was therefore untimely. Id. The court similarly affirmed the dismissal of Frederick's remaining claims-breach of fiduciary duty, negligence, and reckless misrepresentation-because "they are within the penumbra of his legal-malpractice action." Id. at *4. Frederick appealed to this court, and we granted review to determine whether the multiple acts of alleged negligence in this case can give rise to independent causes of action that trigger separate statute of limitations periods.


         "The construction and applicability of statutes of limitations are questions of law that [we] review[] de novo." Benigni v. Cty. of St. Louis, 585 N.W.2d 51, 54 (Minn. 1998). On appeal from a dismissal on a motion for judgment on the pleadings, we "review de novo whether 'the complaint sets forth a legally sufficient claim for relief, ' " which includes the question of whether the complaint itself was timely filed. Zutz v. Nelson, 788 N.W.2d 58, 61 (Minn. 2010) (quoting Bodah v. Lakeville Motor Express, Inc., 663 N.W.2d 550, 553 (Minn. 2003)). We must "accept the facts alleged in the complaint as true and construe all reasonable inferences in favor of the nonmoving party." Walsh, 851 N.W.2d at 606. We also consider statements or documents incorporated as exhibits into the pleadings. Minn. R. Civ. P. 10.03 ("A copy of any written instrument which is an exhibit to a pleading is a part of the statement of claim or defense set forth in the pleading.").

         The statute of limitations for a legal-malpractice claim[3] is 6 years. Minn. Stat. § 541.05, subd. 1 (5). We have previously determined that the statute of limitations period begins to run when a cause of action accrues for legal malpractice. Antone, 720 N.W.2d at 335. There is no dispute that a claim accrued on the date of the marriage, September 29, 2006, for the errors that Wallerich made when she failed to ensure that the antenuptial agreement was validly executed. See id. The claim based on that negligent act is unquestionably untimely because it was not filed by September 29, 2012. See Minn. Stat. § 541.05, subd. 1(5). Because Frederick filed his legal-malpractice claim on September 10, 2013, there must be a separate claim that accrued on or after September 10, 2007, for the filing to be timely.

         "Accrual" is the point at which a plaintiff can allege sufficient facts to survive a motion to dismiss for failure to state a claim on which relief can be granted. Antone, 720 N.W.2d at 335 (citing Dalton v. Dow Chem. Co., 158 N.W.2d 580, 584 (Minn. 1968)). If Frederick has accrued multiple causes of action for legal malpractice at different points in time, then some of the claims may be timely when others are not. Cf. Honn v. Nat'l Comput. Sys. Inc., 311 N.W.2d 1, 2 (Minn. 1981) (holding that a separate limitations period runs from accrual of each separate cause of action in an installment contract). An analysis of when a claim accrues, which turns on whether it can survive a motion to dismiss, necessarily involves consideration of all elements of the claim. Dalton, 158 N.W.2d at 584 ("Thus, the alleged negligence . . . coupled with the alleged resulting damage is the gravamen in deciding the date upon which the cause of action at law herein accrues." (emphasis added)).

         To state a claim for legal malpractice, a plaintiff must allege "(1) the existence of an attorney-client relationship; (2) acts constituting negligence or breach of contract; (3) that such acts were the proximate cause of the plaintiff's damages; [and] (4) that but for the [attorney-]defendant's conduct the plaintiff would have been successful in the prosecution or defense of the action." Antone, 720 N.W.2d at 334 (first alteration added) (citing Blue Water Corp. v. O'Toole, 336 N.W.2d 279, 281 (Minn. 1983)). When the case involves a transactional matter, as here, the final element is necessarily modified; it turns on whether the attorney's conduct was the but-for cause of the failure to obtain a more favorable result rather than success or failure in litigation. Jerry's Enters., Inc. v. Larkin, Hoffman, Daly & Lindgren, Ltd., 711 N.W.2d 811, 819 (Minn. 2006). The showing that a plaintiff must make to survive a motion to dismiss on these elements "is minimal, " but failure to satisfy any element defeats the entire claim. Noske v. Friedberg, 670 N.W.2d 740, 742 (Minn. 2003); see Minn. R. Civ. P. 12.02(e).

         It is undisputed that the facts alleged in this case satisfy the first element of a legal-malpractice claim, the existence of an attorney-client relationship. At issue are the remaining elements: whether negligent acts exist that were the proximate and but-for cause of Frederick's damages. To determine the remaining three elements we must consider: (1) whether Wallerich's failures to alert Frederick of the unenforceability of his antenuptial agreement could be independent acts of negligence from the negligent execution of the antenuptial agreement itself; (2) whether Frederick suffered damages caused by these failures; and (3) whether those damages are independent of the damages attributable to the negligent execution of the antenuptial agreement. We address each in turn.


         We have not previously addressed whether, and when, multiple acts of legal malpractice can give rise to independent causes of action, each having a separate accrual date under an applicable statute of limitations.


         We first address whether multiple acts of legal malpractice can give rise to independent causes of action. The parties frame the issue in very different terms. Wallerich maintains that no cause of action has accrued separate from the 2006 execution of the antenuptial agreement based on a primary-right theory. In Wallerich's view, Frederick suffered one violation of one primary right-the errors in the drafting of his antenuptial agreement-and therefore all of the acts are part of a single claim that accrued on September 29, 2006, the date of the marriage. Frederick alleges that each time he sought legal advice from Wallerich after signing the antenuptial agreement in 2006, Wallerich committed an independent act of malpractice by failing to inform him of the antenuptial agreement's invalidity.[4] Frederick argues that the 2007 will drafting, in particular, was an entirely separate negligent act that gave rise to an independent cause of action for legal malpractice that accrued separately on the date of its execution. We agree with Frederick.

         Wallerich's primary-right framework is outdated. It is well established that a cause of action accrues for a legal-malpractice claim when "the cause of action will survive a motion to dismiss for failure to state a claim upon which relief can be granted." Herrmann v. McMenomy & Severson, 590 N.W.2d 641, 643 (Minn. 1999). Thus, the existence of a timely suit here rises or falls on Frederick's ability to demonstrate whether the elements of a legal-malpractice claim are satisfied by an act that occurred within the 6-year statute of limitations, not his ability to prove a violation of a separate primary right. Dalton, 158 N.W.2d. at 584; see Herrmann, 590 N.W.2d at 643 n.12.

         Further, we have previously indicated that separate negligence causes of action may accrue independently within the same set of facts, and therefore can trigger separate accrual dates. See, e.g., Togstad v. Vesely, Otto, Miller & Keefe, 291 N.W.2d 686, 693-95 (Minn. 1980) (noting that the same attorney could have been negligent both for rendering advice without research and for failing to advise the same client on the applicable statute of limitations); cf. Capitol Supply Co. v. City of St. Paul, 316 N.W.2d 554, 555 (Minn. 1982) (determining that a complaint that alleged City negligence during the course of a 1970 road project presented two distinct causes of action: one for "negligent change in the grade of an established road" and another for "negligent design and construction, " and applying two separate ...

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