CA: Real Estate; Commercial Lease
Facts: VMI (the plaintiff) is a manufacturer of circuit boards. In 2005 the plaintiff moved into a new property. VMI was dissatisfied with the condition of the property and hired Glasser to draft an addendum to the lease. VMI alleged that Glasser was negligent and breached his fiduciary duty when he did not properly advise VMI concerning the lease addendum. The plaintiffs had incurred many expenses in connection to the lease addendum including attorney fees, and losses while attempting to rescind the lease addendum. The plaintiff also suffered losses because they were unable to use the property. Glasser moved for summary judgment on the basis that the claim for malpractice was barred because the statute of limitations had expired. The trial court granted summary judgment to Glasser. VMI contends that the statute was tolled because they suffered no injury until they lost a lawsuit trying to rescind the addendum and because Glasser provided continuous representation until less than one year prior to the malpractice suit. The court found that Glasser did not provide continuous representation. His representation ended when he completed the addendum.
Issue: Is actual injury sustained at the time of obtaining a lawyer or when the plaintiff loses the lawsuit?
When is an attorney’s representation completed?
Ruling: Actual injury is sustained at the time of obtaining a lawyer. The “determination of actual injury requires only a factual analysis of the claimed error and its consequences.” An actual settlement or judgment is not required. An attorney’s representation is completed when “the agreed tasks or events have occurred.” In this case the representation of the attorney ended when communications concerning the lease addendum ended.
Lesson: An attorney should always use a termination letter to avoid allegations of continuous representation. Actual injury occurs at the time that the injury is realized and not when a court declares a judgment.