Skipper v. ACE Prop. & Cas. Ins. Co.
775 S.E.2d 37
S.C.2015Background
- George Skipper (Georgia) was injured in a collision with a logging truck owned by Specialty Logging, LLC and driven by Harold Moors; Specialty carried a $1,000,000 commercial auto policy issued by ACE.
- Skipper demanded policy limits; ACE retained attorneys Rowlen and Coia to represent Specialty and Moors; settlement offers failed and Skippers sued Specialty and Moors in state court.
- Unbeknownst to ACE and its counsel, Specialty Parties confessed judgment for $4,500,000 and assigned the predominant interest in a legal-malpractice claim against ACE and its lawyers to the Skippers.
- The assignment included a provision that Skippers would receive 85–95% of any proceeds from the malpractice recovery; in return, Skippers agreed not to execute the confession so long as Specialty cooperated in malpractice litigation.
- Plaintiffs (Skippers + Specialty Parties) filed the malpractice suit; defendants moved arguing the assignment was invalid. The federal district court certified the novel question to the South Carolina Supreme Court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a legal-malpractice claim can be assigned between adversaries in the underlying litigation | Assignment valid; minority rule permits such assignments to pursue malpractice remedies | Assignment invalid as against public policy because it risks collusion, inflated consent judgments, and conflicts of interest | No — South Carolina adopts the majority rule forbidding such assignments as against public policy |
Key Cases Cited
- Edens Techs., LLC v. Kile Goekjian Reed & McManus, PLLC, 675 F. Supp. 2d 75 (D.D.C.) (majority rule recognizing public-policy risks of adversary-to-adversary malpractice assignments)
- Prince v. Peterson, 538 P.2d 1325 (Utah 1975) (emphasizing jury-role integrity and dangers of inflated consent judgments)
- Alcman Servs. Corp. v. Bullock, 925 F. Supp. 252 (D.N.J.) (warning against transmuting claims against penniless adversaries into claims against their attorneys)
- Zuniga v. Groce, Locke & Hebdon, 878 S.W.2d 313 (Tex. App.) (describing demeaning role reversals and conflicts from such assignments)
- Moore v. Moore, 360 S.C. 241 (S.C. Ct. App.) (599 S.E.2d 467) (noting fiduciary nature of attorney-client relationship)