TREASURE VALLEY BANK, a state chartered banking institution v. KILLEN & PITTENGER, P.A.; William M. Killen and Kathy Killen, husband and wife; and Gregory C. Pittenger and Linda Pittenger, husband and wife
No. 16186
Supreme Court of Idaho
Feb. 5, 1987
732 P.2d 326
drug area, the question is going to be, you have some benefits accruing to group A. In the case of a vaccine, all of the people who are prevented from catching this disease, 50,000, 40,000 whatever the number might be, they get the benefit of having had Tri-immunol on the market. Some smaller number of people are going to suffer and suffer terribly as a result. Juries are going to have to ask the question, group A v. group B. Efficacy with respect to group A v. harm in group B. That‘s a very difficult question. It‘s essentially a moral question. It‘s a legislative question. It‘s the kind of a question that juries ought not to be asked to answer. They‘re ill-equipped to do it, and it‘s really an unfair question for juries. But it is a fair question for the legislatures and regulatory bodies that are created by legislatures to be required to answer. I see I‘m out of time. I have many other points, but I thank you for your attention.
Rolf M. Kehne, Boise, for plaintiff-appellant.
W. Scott Wigle of Quane, Smith, Howard & Hull, Boise, for defendants-respondents.
BAKES, Justice.
The appellant, Treasure Valley Bank (TVB), brought a legal malpractice action against the law firm of Killen & Pittenger, P.A. (Killen), alleging negligent representation in a bankruptcy proceeding. Killen moved for summary judgment alleging that the appropriate statute of limitations set forth in
In a summary judgment proceeding, “[t]he facts are to be liberally construed in favor of the party opposing the motion, who is also to be given the benefit of all favorable inferences which might be reasonably drawn from the evidence.” Huyck v. Hecla Mining Co., 101 Idaho 299, 300, 612 P.2d 142, 143 (1980); Farmers Ins. Co. v. Brown, 97 Idaho 380, 544 P.2d 1150 (1976); Salmon River Sportsmen Camps, Inc. v. Cessna Air Co., 97 Idaho 348, 544 P.2d 306 (1975); Smith v. Idaho State University Federal Credit Union, 103 Idaho 245, 247, 646 P.2d 1016, 1018 (Ct.App.1982);
The facts in this case were stipulated by the parties for the purpose of the summary judgment motion. William Killen represented TVB in a Chapter 13 bankruptcy proceeding initiated by one of TVB‘s debtors.2 Killen‘s duties required him to file TVB‘s claims with the federal bankruptcy court. The bankrupt owed TVB approximately $93,000 on the date the Chapter 13 bankruptcy was filed. After preliminary questions on the debtor‘s bankruptcy plan were resolved, the debtor‘s amended Chapter 13 bankruptcy plan was confirmed by the bankruptcy court on August 24, 1982. This plan established the legal relationship between TVB and the debtor and awarded TVB $93,210.98, but made no mention of interest.
Two days later, on August 26, 1982, Killen sent TVB a letter reporting the results of the confirmation hearing, stating, “The amounts allowed to us will draw interest at the rate provided in
This Court has dealt with the question of professional malpractice in a number of recent cases. These cases point out that while
On August 24, 1982, the bankruptcy court confirmed the amended Chapter 13 plan which fixed the rights and obligations of the parties. The August 24th ruling was reaffirmed on December 12, 1983, when the bankruptcy court denied TVB‘s claim for post-confirmation interest and stated that such claim was not included in the amended Chapter 13 plan approved at the August 24, 1982, confirmation hearing. As a matter of federal law, TVB lost its opportunity
Accordingly, the district court did not err in granting the summary judgment. The two-year statute of limitations for professional malpractice set forth in
For the foregoing reasons, the decision of the district court is affirmed. Costs to respondents.
SHEPARD, C.J., and DONALDSON and HUNTLEY, JJ., concur.
BISTLINE, Justice, dissenting.
The majority nicely frames the issue: “The question in this case is whether or not Treasure Valley Bank unquestionably suffered some monetary damage on August 24, 1982, the date of confirmation of the plan, or whether there is a material issue of fact over whether damage, if any, occurred at some later date.” Ante at p. 328. However, I cannot agree with the majority‘s answer to that question.
To decree that the Bank unquestionably suffered monetary damage at the confirmation hearing is to hold the client to the standard of a bankruptcy lawyer. This the majority does not hesitate to do: “As a matter of federal law, TVB lost its opportu-nity to secure post-confirmation interest on the secured claim on August 24, 1982, and that is the date upon which damage occurred.” Ante at p. 328. How was the Bank to know “as a matter of federal law” that it might be damaged by its attorney‘s failure to specify, in unambiguous terms, its desire for post-confirmation interest in the document spelling out the debtor‘s repayment plan? To charge the client with such knowledge of federal law is particularly unrealistic here where the attorney, only two days after the confirmation hearing, wrote to the Bank assuring that it would receive interest.
Until today, the “date of damage” rule had been applied reasonably consistently by this Court in the recent cases of Mack Financial, Streib, Blake, and Stephens. Now the trial bench and bar will be left guessing how to advise their clients based on our zig-zag interpretation of
The rationale for the “date of damage” rule is two-fold. First, it is axiomatic that no cause of action in negligence, such as professional malpractice, can accrue until all essential elements of the claim, including damages, have occurred. Chief Justice Shepard analyzed this point extremely well in Streib. Second, damages must have occurred so that the Bank is put on notice that action is required within a definite time period; otherwise, it will be viewed as having “slept on its rights.” See Mack Financial Corp. v. Smith, 111 Idaho at 11, 720 P.2d at 194 (1986).
Applying these principles to the case at hand, it is apparent the matter must be remanded to the district court for a determination of the date when the Bank first received a payment from the debtor which it knew or should have known did not include interest. Neither the record nor the briefs reveal precisely when those no-interest payments began. The date of the first such payment would satisfy both prongs of the date of damage rationale discussed above. Obviously, it is the date when monetary damages began. Equally clear is that this date would be the earliest point that the Bank conceivably could be said to be on notice that it might have a claim against its attorney for failing to ensure that interest would be included in the confirmation plan.
In contrast, the date chosen by the majority is merely the date the alleged negligent act of the attorney occurred. Thus, the majority creates an unacceptable conflict with Streib which should control our decision here. In Streib the injured party suffered no monetary damage until served with a notice of tax deficiency. Here Treasure Valley Bank did not suffer damage until it began receiving payments minus interest. Therefore, our better action would be to remand to the district court to determine that crucial date.
BAKES
Justice