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Guinn v. Murray

Supreme Court of Nebraska

September 27, 2013

KEVYNE A. GUINN ET AL., TRUSTEES OF THE TRUSTS CREATED UNDER THE BERNARD M. O’DANIEL REVOCABLE TRUST AGREEMENT DATED OCTOBER 22, 1998, AS AMENDED BY FIRST AMENDMENT TO THE BERNARD M. O’DANIEL REVOCABLE TRUST AGREEMENT DATED MARCH 28, 2001, AND PERSONAL REPRESENTATIVES OF THE ESTATE OF BERNARD M. O’DANIEL, DECEASED, AND ELIZABETH M. O’DANIEL, APPELLANTS AND CROSS-APPELLEES,
v.
ROBERT J. MURRAY AND LAMSON, DUGAN & MURRAY, LLP, A NEBRASKA LIMITED LIABILITY PARTNERSHIP, APPELLEES AND CROSS-APPELLANTS.

1. Summary Judgment: Appeal and Error. An appellate court will affirm a lower court's grant of summary judgment if the pleadings and admitted evidence show that there is no genuine issue as to any material facts or as to the ultimate inferences that may be drawn from the facts and that the moving party is entitled to judgment as a matter of law.

2.__: __. In reviewing a summary judgment, an appellate court views the evidence in a light most favorable to the party against whom the judgment was [286 Neb. 585] granted and gives that party the benefit of all reasonable inferences deducible from the evidence.

3. Directed Verdict: Appeal and Error. In reviewing a trial court's ruling on a motion for directed verdict, an appellate court must treat the motion as an admission of the truth of all competent evidence submitted on behalf of the party against whom the motion is directed; such being the case, the party against whom the motion is directed is entitled to have every controverted fact resolved in its favor and to have the benefit of every inference which can reasonably be deduced from the evidence.

4. Directed Verdict: Evidence. A directed verdict is proper at the close of all the evidence only when reasonable minds cannot differ and can draw but one conclusion from the evidence, that is, when an issue should be decided as a matter of law.

5. Limitations of Actions: Appeal and Error. The point at which a statute of limitations begins to run must be determined from the facts of each case, and the decision of the district court on the issue of the statute of limitations normally will not be set aside by an appellate court unless clearly wrong.

6. Limitations of Actions: Malpractice. If the facts in a case are undisputed, the issue as to when the professional negligence statute of limitations began to run is a question of law.

7. Judgments: Appeal and Error. An appellate court independently reviews questions of law decided by a lower court.

8. Limitations of Actions: Negligence: Torts. In a negligence action, a statute of limitations begins to run as soon as the cause of action accrues, and an action in tort accrues as soon as the act or omission occurs. This principle has been referred to as "the occurrence rule."

9. Limitations of Actions: Negligence. A claim for professional negligence accrues and the statute of limitations begins to run at the time of the act or omission which is alleged to be the professional negligence that is the basis for the claim.

10. Limitations of Actions: Damages. A statute of limitations may begin to run at some time before the full extent of damages has been sustained.

11. Limitations of Actions: Negligence. If a claim for professional negligence is not to be considered time barred, the plaintiff must either file within 2 years of an alleged act or omission or show that its action falls within the exceptions of Neb. Rev. Stat. § 25-222 (Reissue 2008).

12. Limitations of Actions: Words and Phrases. "Discovery, " in the context of statutes of limitations, refers to the fact that one knows of the existence of an injury and not that one has a legal right to seek redress. It is not necessary that a plaintiff have knowledge of the exact nature or source of the problem, but only that a problem existed.

13. Limitations of Actions: Malpractice. In a professional negligence case, "discovery of the act or omission" occurs when the party knows of facts sufficient to put a person of ordinary intelligence and prudence on inquiry which, if pursued, would lead to the knowledge of facts constituting the basis of the cause of action.

[286 Neb. 586] 14. Malpractice: Damages: Words and Phrases. In a cause of action for professional negligence, legal injury is the wrongful act or omission which causes the loss. Legal injury is not damage; damage is the loss resulting from the misconduct.

15. Limitations of Actions: Malpractice. Under the continuous representation rule, the statute of limitations for a claim of professional negligence is tolled if there is a continuity of the relationship and services for the same or related subject matter after the alleged professional negligence.

16. __:__. Continuity does not mean mere continuity of the general professional relationship, and the continuous representation rule is inapplicable when the claimant discovers the alleged negligence prior to the termination of the professional relationship.

17. Summary Judgment: Appeal and Error. The denial of a summary judgment motion is neither appealable nor reviewable.

18. Summary Judgment: Moot Question: Appeal and Error. Whether a motion for summary judgment should have been granted generally becomes moot after trial. This is because the overruling of such a motion does not decide any issue, but merely indicates that the trial court was not convinced that the moving party was entitled to judgment as a matter of law. After trial, the merits should be judged in relation to the fully developed trial record, not whether a different judgment may have been warranted on the record at summary judgment.

19. Malpractice: Attorney and Client: Negligence: Proof: Proximate Cause: Damages. In a civil action for legal malpractice, a plaintiff alleging professional negligence on the part of an attorney must prove three elements: (1) the attorney's employment, (2) the attorney's neglect of a reasonable duty, and (3) that such negligence resulted in and was the proximate cause of loss to the client.

20. Malpractice: Attorney and Client. In a legal malpractice action, the required standard of conduct is that the attorney exercise such skill, diligence, and knowledge as that commonly possessed by attorneys acting in similar circumstances.

21.__:__. Although the general standard of an attorney's conduct is established by law, the question of what an attorney's specific conduct should be in a particular case and whether an attorney's conduct fell below that specific standard is a question of fact.

22. Attorney and Client: Expert Witnesses. Expert testimony is generally required to establish an attorney's standard of conduct in a particular circumstance and that the attorney's conduct was not in conformity therewith.

23. Summary Judgment: Expert Witnesses: Testimony. A conflict of expert testimony regarding an issue of fact establishes a genuine issue of material fact which precludes summary judgment.

Appeal from the District Court for Douglas County: W. Russell Bowie III, Judge. Affirmed in part, and in part reversed and remanded for further proceedings.

W. Patrick Betterman and Lindsay E. Pedersen, of Law Offices of W. Patrick Betterman, for appellants.

[286 Neb. 587] James M. Bausch and Andre R. Barry, of Cline, Williams, Wright, Johnson & Oldfather, L.L.P., for appellees.

Heavican, C.J., Connolly, and Stephan, JJ., and Irwin, Judge.

Per Curiam.

NATURE OF CASE

In this legal malpractice case, clients sued an attorney and his firm alleging professional negligence in connection with the administration of an estate. The clients, who are relatives of the decedent, Bernard M. O'Daniel, appeal. The attorney and law firm, Robert J. Murray and Lamson, Dugan & Murray, LLP, cross-appeal. For the reasons explained below, we affirm the judgment entered in favor of Murray and the firm on the clients' claim that they failed to properly disclose a conflict of interest, and we reverse the judgments entered dismissing as time barred the clients' claims regarding the propriety of advice regarding disclaiming certain property and associated tax return elections. We remand the cause for further proceedings on these two claims. Murray and the firm cross-appeal regarding a preliminary ruling made on August 22, 2011, and we find no merit to the assignment of error in the cross-appeal.

STATEMENT OF FACTS

The appellants and cross-appellees in this case are Bernard's widow, Elizabeth M. O'Daniel, and three of Bernard's six surviving children, Kevyne A. Guinn, Michael F. O'Daniel, and Maureen E. Toberer. The children are parties to this case in their capacities as personal representatives of Bernard's estate and as trustees of trusts created by Bernard. The ...


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