Holland v. Kantrovitz & Kantrovitz LLP
AC 16-P-705
| Mass. App. Ct. | Aug 15, 2017Background
- Holland slipped on ice in January 2008 and sustained serious injuries; she retained Kantrovitz & Kantrovitz LLP as personal injury counsel in September 2009.
- In October 2009 Holland (pro se) filed Chapter 7 bankruptcy and received a discharge in February 2010; she did not list the personal-injury claim on the bankruptcy schedules.
- At the November 2009 creditors’ meeting Holland disclosed the fall and said she believed she "had" a right to sue; the parties dispute whether this constituted adequate disclosure.
- Kantrovitz allegedly failed to communicate meaningfully with Holland before and during the bankruptcy and failed to file a personal-injury suit before the statute of limitations expired on January 15, 2011.
- Holland sued for legal malpractice. Defendants moved for summary judgment arguing (1) the malpractice claim was barred by the bankruptcy (failure to disclose) and (2) judicial estoppel precluded recovery.
- The Appeals Court reversed summary judgment, holding the malpractice claim was not extinguished by the bankruptcy as a matter of law and that factual disputes (disclosure and good faith) precluded judicial estoppel at summary judgment; the case was remanded and the trustee notified.
Issues
| Issue | Holland's Argument | Kantrovitz's Argument | Held |
|---|---|---|---|
| Whether Holland's malpractice claim was part of the bankruptcy estate or extinguished by nondisclosure | Malpractice claim accrued after bankruptcy (when statute ran); not part of estate; bankruptcy discharge did not extinguish underlying claim's value | Because Holland failed to disclose the underlying claim in bankruptcy, she gave up the right to pursue it and therefore cannot show malpractice caused harm | Held for Holland: malpractice claim had not accrued prepetition; bankruptcy discharge did not by itself extinguish the underlying claim — statute of limitations did; disputed factual issues remain regarding value and trustee's interest |
| Causation: Can Holland prove harm from the lawyer's failure to sue given her bankruptcy nondisclosure? | The underlying tort claim retained value until limitations ran; if value exceeded discharged debts, trustee/creditors might have had interest but nondisclosure does not automatically eliminate causation | Nondisclosure and discharge barred any recovery on the underlying claim, so malpractice caused no compensable harm | Held for Holland: summary judgment improper — causation is a factual question; trustee may have an interest in proceeds to the extent of discharged claims and must be notified |
| Judicial estoppel: Does Holland’s alleged failure to disclose preclude her malpractice suit? | Holland acted in good faith or at least her disclosure to the trustee was ambiguous; she did not intend to hide the claim | Holland took an inconsistent position (failed to schedule the claim) and prevailed in bankruptcy, so estoppel applies | Held for Holland: factual disputes about what Holland told the trustee and her good faith preclude judicial estoppel on summary judgment |
| Whether summary judgment was appropriate on pleading/theory grounds | Malpractice theory includes communication failures and failure to sue; plaintiff may pursue those theories | Defendants argued malpractice limited to failure to sue as pleaded | Court declined to affirm on that ground because summary judgment improperly resolved factual disputes; remand required |
Key Cases Cited
- Sullivan v. Liberty Mut. Ins. Co., 444 Mass. 34 (recited summary-judgment standard)
- Butner v. United States, 440 U.S. 48 (property of the bankruptcy estate determined by state law)
- Segal v. Rochelle, 382 U.S. 375 (when prepetition causes of action are sufficiently rooted in pre-bankruptcy past they are estate property)
- Lyons v. Nutt, 436 Mass. 244 (malpractice accrual requires appreciable harm)
- Williams v. Ely, 423 Mass. 467 (malpractice accrual principle cited)
- Frullo v. Landenberger, 61 Mass. App. Ct. 814 (but-for causation in legal malpractice)
- Colucci v. Rosen, Goldberg, Slavet, Levenson & Wekstein, P.C., 25 Mass. App. Ct. 107 (causation standard in malpractice)
- Bongiorno v. Liberty Mut. Ins. Co., 417 Mass. 396 (malpractice causation/standing principles)
- Otis v. Arbella Mut. Ins. Co., 443 Mass. 634 (elements and equitable nature of judicial estoppel)