Recent Developments in Legal Malpractice Litigation

By Elizabeth Starrs

Does a former client have to raise her claims of legal malpractice when her lawyer sues for nonpayment of fees? According to the Colorado Court of Appeals decision of Allen v. Martin on June 12, 2008, the answer to that question is "yes."

In Allen, the client was an officer of a company which hired the defendant lawyers to advise it on business matters. Neither the company nor the individual (who personally guaranteed payment of the legal fees) paid the lawyers and a collection action ensued. Neither the company nor the individual participated in the collection action and the lawyers obtained a default judgment against them.

Two years later, the individual and the company sued the lawyers for malpractice. The Colorado Court of Appeals dismissed the malpractice case against the lawyers because they did not raise the issues in the collection action and therefore were forever barred from bringing it.

People who find themselves being sued for legal fees should not ignore this but seek legal advice to evaluate their options and consider whether they can counterclaim for legal malpractice.