MD: Underlying Divorce Proceeding
Facts: In 1999, following the couple’s separation, Dr. Harold Alfert and attorney Karen Vogel (Client) entered into a property settlement agreement that provided for the equal division of their marital assets (valued at approximately two million dollars). After apparently discovering that her husband had failed to fully disclose the true value of the couple’s assets, Client retained T. Joseph Touhey (Attorney) to represent her in her divorce proceeding and to renegotiate the property settlement agreement. Dissatisfied with Attorney’s services, Client discharged Attorney and settled the dispute on her own for $50,000—a sum she agreed at the time was “fair and equitable.” Several months later, Client brought a malpractice action against Attorney, alleging that because he had failed to properly request and review documents pertaining to her husband’s finances, she had been forced to settle for an inadequate sum.
Issue: Was Client judicially stopped from asserting a malpractice claim against Attorney for his negligent representation in connection with her divorce after representing to the court that the settlement agreement in which she was entering was “fair and equitable”?
Ruling: Yes. Client’s decision to accept the settlement award prevented her from being able to later assert a claim for legal malpractice. The doctrine of judicial estoppel bars an individual from making inconsistent statements to the court. Having fired Attorney for his negligent conduct, Client was aware that the settlement agreement he had proposed was drafted without full knowledge of the facts of the case. Client was under no obligation to either agree to its terms or assert to the court that its terms were “fair and equitable.” Having done so, however, she was judicially estopped from later claiming that Attorney’s negligence caused her to accept an award that was inadequate. As the appellate court had stated:
“when a person who is particularly knowledgeable as a lawyer stands up, after being dissatisfied with her own lawyer and says, after having the documents in her hands that she later is going to use as the basis of a malpractice action,  that everything is fair and equitable, I don’t see how this can proceed in violation of the judicial estoppel rule.”
Lesson: In Maryland, a client will be judicially estopped from asserting a claim for malpractice if she first conveys to the court that she is satisfied with the actions of, or the settlement produced by, her attorney. (And no, coercing your client into making such statements on the record is not a good idea.)