787 S.E.2d 485
S.C.2016Background
- Austin sued Stokes-Craven (auto dealer); jury returned a verdict for Austin with significant punitive damages; this Court affirmed and issued remittitur in 2010.
- Stokes-Craven sued its trial counsel (Robinson and firm) for legal malpractice on August 16, 2010, alleging pre-trial and trial failures caused the adverse verdict.
- Respondents moved for summary judgment arguing the three-year statute of limitations had run; the circuit court held the limitations period began at the date of the adverse jury verdict (2006) and granted summary judgment.
- Stokes-Craven appealed and argued Epstein v. Brown (2005) was wrongly applied; it asked this Court to adopt a bright-line rule tolling the malpractice limitations period while an appeal is pending.
- The Supreme Court overruled Epstein, held that when an appeal is pending the lower court is divested of jurisdiction over matters affected by the appeal under Rules 205/241, and therefore a malpractice claim based on the underlying verdict accrues only after the appeal is resolved (typically upon remittitur).
- The Court reversed the grant of summary judgment (Stokes-Craven’s malpractice suit was timely) and remanded; it also found the trial court abused its discretion in denying discovery of insurer communications without an in camera review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When does the 3-year statute of limitations for a legal malpractice claim based on an adverse verdict begin to run? | Statute should not run until appellate process concludes (remittitur); trial verdict alone not the accrual date. | Limitations began at the adverse jury verdict; plaintiff knew or should have known then (Epstein). | Court overruled Epstein and held accrual is tolled while the underlying appeal is pending; malpractice claim based on the verdict accrues after appeal resolution (typically remittitur). |
| Applicability of the discovery rule vs. continuous-representation rule | Plaintiff favored a bright-line remittitur rule to protect clients who appeal and relied on counsel. | Defendant relied on discovery rule and Epstein to start limitations at verdict. | Court retained discovery rule but held Rule 205/241 require tolling during appeal; declined to adopt continuous-representation rule. |
| Whether the circuit court correctly granted summary judgment on statute of limitations grounds | Stokes-Craven argued material facts show it did not know of a claim at verdict and its suit was timely after remittitur. | Respondents argued claim was time-barred because accrual occurred at verdict. | Summary judgment reversed — malpractice suit filed after remittitur was timely. |
| Whether communications between defendants and their malpractice insurer were discoverable | Stokes-Craven argued correspondence was ordinary-course insurance business or that substantial need justified discovery. | Respondents asserted work-product/attorney-client protection and that documents were prepared in anticipation of litigation. | Trial court abused discretion by denying production without in camera review; remand for in camera review and specific ruling. |
Key Cases Cited
- Epstein v. Brown, 363 S.C. 372, 610 S.E.2d 816 (2005) (prior rule holding malpractice limitations began at trial verdict; rejected here)
- Austin v. Stokes-Craven Holding Corp., 387 S.C. 22, 691 S.E.2d 135 (2010) (underlying appeal affirmed; remittitur issued; factual context)
- Holmes v. Haynsworth, Sinkler & Boyd, P.A., 408 S.C. 620, 760 S.E.2d 399 (2014) (discusses elements of legal malpractice and prior reliance on Epstein)
- Burgess v. American Cancer Society, S.C. Div., 300 S.C. 182, 386 S.E.2d 798 (Ct.App. 1989) (articulates discovery rule for accrual: objective standard of when claimant should know of cause of action)
- Dean v. Ruscon Corp., 321 S.C. 360, 468 S.E.2d 645 (1996) (explains discovery rule—statute runs when cause reasonably ought to have been discovered)
- Lancaster v. Georgia-Pacific Corp., 403 S.C. 136, 742 S.E.2d 867 (2013) (discusses appellate jurisdiction and remand/remittitur principles)