Collectibility or Uncollectibility: It Is Still By A Proponderance Of The Evidence

In Kituskie v. Corbman, it is shown that in order to prevail in a legal malpractice claim arising out of a civil matter, the plaintiff must prove by a preponderance of the evidence that he or she would have prevailed in the underlying matter 682 A.2d 378 (1996).

Leo Kituskie, Plaintiff, was injured in a two-car accident during a vacation in San Jose, California. The accident report stated that Evan Trapp, who was driving while intoxicated and at a high rate of speed, crossed a highway on-ramp and hit Kituskie’s vehicle. Kituskie, at 1028. On September 9, 1989, Kitsukie returned to Philadelphia to begin treatment for his injuries and retained Scott K. Corbman, Attorney Defendant, to pursue his claim against Trapp for the personal injuries he sustained in the accident. Corbman was licensed to practice law in Pennsylvania.

Corbman obtained Kituskie’s medical reports, then made a claim on Kituskie’s behalf against the California State Automobile Association (“CSAA”), Trapp’s insurance carrier. Id. at 1029. While negotiating with the insurance carrier, Corbman learned that Trapp’s insurance policy limit was $25,000.

In September 17, 1990, more than one year after the accident, Corbman discovered that California’s statute of limitations for Kitsukie’s injuries was one year as opposed to Pennsylvania’s two-year statute of limitations. CSAA informed Corbman that it would not make a settlement offer to Kituskie because Corbman had not instituted a formal legal action or settled within the one-year statute of limitations.

Being a diligent attorney, Corbman related this information to Kituskie and advised him that he should obtain other counsel and institute a claim against him for legal malpractice. Plaintiff Kituskie did just that, against Defendant Corbman and his firm, the Garfinkle law firm. The trial lasted six days, and a jury found Corbman and the Garfinkle firm liable for legal malpractice in the amount of $2,300,000.

On appeal, the superior court “vacated the judgment and remanded for further proceedings because it held that the collectibility of damages in an underlying case should be considered in a legal malpractice action.” Id. at 1029. It also held that the attorney sued for legal malpractice bears the burden of proving as a defense that the underlying case would have been uncollectible.

Finally, the Supreme Court of Pennsylvania granted allocatur to decide two issues: (1) whether collectibility should be part of a legal malpractice action; and, if so, (2) which party bears the burden of proof as to collectibility.

In a unanimous opinion, the court held that collectibility of damages in the underlying case should be considered in legal malpractice actions. Furthermore, the Supreme Court agreed with the superior court that “it would be inequitable for the plaintiff to be able to obtain a judgment against the attorney which is greater than the judgment that the plaintiff could have collected from the third party.” Kituskie, 714 A.2d at 1030.

Further, The court noted that, although jurisdictions have unanimously agreed that collectibility should be considered, they have been split on the additional question of who bears the burden of proof. The majority of courts have placed the burden on the plaintiff, while a small minority have placed the burden of proving (un)collectibility on the attorney-defendant. The Supreme Court of Pennsylvania adopted the minority position and held that an attorney-defendant “in a legal malpractice action should plead and prove the affirmative defense that the underlying case was not collectible by a preponderance of the evidence.” Id. at 1032.

As a result, the Court affirmed the superior court’s holding that the collectibility of damages is to be considered in a legal malpractice cause of action and that the burden of proving (un)collectibility of damages in the underlying case is borne by the attorney-defendant. The court remanded the matter to the trial court for further proceedings.

The take away from this case is that it appears the court allows a plaintiff whose original action may have been uncollectible to establish a prima facie case of legal malpractice against an attorney without proving actual loss and to possibly recover a windfall at the attorney’s expense.

About Matthew Weisberg

Matthew B. Weisberg, Esquire, Managing Partner of Prochniak Weisberg, P.C. (www.ppwlaw.com), focuses his practice almost exclusively on the representation of consumers who are victims of mortgage, real estate and auto purchase/financing fraud, as well as in foreclosure/debt collection defense and civil rights representation (employment discrimination and excessive police force). Five years ago having “switched sides,” Mr. Weisberg formerly represented exclusively commercial and residential lenders in the prosecution of mortgage foreclosure and distressed debt collection litigation, lender liability and real estate speculator defense, and tort defense for financial injury defendants. Matthew welcomes all attorney inquiries and especially referrals: 610-690-0801 & mweisberg@ppwlaw.com.
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