DC:  Legal malpractice verdict in favor of plaintiff reversed on appeal due to lack of privity

In Scott v. Burgin, No. 12-V-1474 (D.C. Aug. 14, 2014), the Court reversed a $255,000 jury award in a legal malpractice case against a divorce attorney. The plaintiff was not a client of the defendant law firm, and consequently the Court held that the defendant's duty of care did not extend to the Plaintiff, and reversed the judgment. In so doing, the Court refused to expand the third party beneficiary exception to the requirement of privity in a legal malpractice action.

The plaintiff's fiancé was a retired government employee, who was long separated from his first wife, but they had never gotten a divorce.

The plaintiff and her fiancé had a long-standing relationship of over 25 years. After the fiancé was diagnosed with terminal bone cancer, the plaintiff met with the defendant attorney to seek his help in getting the fiancé a divorce from his separated wife. The attorney said he would help the fiancé, if the fiancé chose to retain him. The fiancé wished to obtain a divorce so that he could marry the plaintiff. Although he had previously designated the plaintiff as the beneficiary of his federal benefits, he was aware that the plaintiff might not receive them unless their were married.

A year passed before the fiancé met with the attorney. Shortly thereafter, the fiancé signed a retainer agreement for the lawyer's representation in his divorce proceedings.

Unfortunately, the attorney did not serve the separated wife with the divorce complaint until November, 2007, about 11 months later. The fiancé died in April, 2008, and a divorce was never secured prior to his death.

Afterwards, the federal government denied the plaintiff's claim for survival benefits under the Civil Service Retirement System, based on evidence showing that the earlier marriage was never terminated.

The plaintiff brought suit against the lawyer for legal malpractice and the related breach of contract as a third-party beneficiary, and the jury returned a verdict in favor of the plaintiff.

On appeal, the sole issue was whether the plaintiff lacked standing to sue for legal malpractice or breach of contract.

The Court held that the plaintiff did not have standing. It was undisputed that the fiancé and the fiancé alone, was the lawyer's client. In the District of Columbia, both contracting parties must intend a direct benefit which the third party can enforce against the promisor, for classic third-party beneficiary liability to exist. Here, there was no real evidence that the attorney himself intended to incur any liability beyond that imposed by law as part of his duty of care.

The Court reaffirmed the general rule that the obligation of an attorney is to his client, and not to a third party. The Court distinguished the recognized exception to that rule, where the impact upon the third party is not an indirect or collateral consequence, but the end and aim of the transaction. The classic situation that meets that exception is the failure of an attorney to properly draft a will.

Here, the anticipated divorce decree did not provide the same direct benefits to the plaintiff. The Court stated that the fiancé of either party to a divorce is a complete stranger to the transaction, and the divorce does nothing to change that status. The newly divorced person would have had to take at least one further action, that is, marry the plaintiff. The Court noted that in the divorce proceedings, the pension rights at issue might have been the subject of controversy, since the separated wife had had four children in the marriage.

To permit the plaintiff's suit here would frustrate one of the primary goals of the privity rule, that is, avoiding exposure to the attorney to indeterminate liability to an indeterminate class of people. It would also undermine the ability of the attorney and the client to exercise control over their contractual agreement.