Kentucky Legal Malpractice Statute

In 1983, Guy Holloway was a passenger in a serious one-car wreck that left him a paraplegic. Originally, he employed attorney Chris Seaman to represent him, but became dissatisfied with Seaman, later disbarred, and employed attorney Eli George to handle his personal injury claim. At issue was $50,000 of liability coverage.

George secured same and checks were cut, the representation terminating in July of 1986. The original fee agreement between George and Holloway was typical, except that a line was drawn through the portion of the contract which eliminated George's fee from any PIP benefits. This deletion, and the interpretation would later be critical to this case.

Also important, the vehicle in which Holloway was driving had a Michigan insurance policy, which provided Michigan PIP benefits, which are to say the least, generous, providing all sorts of care, indefinitely, and without limit. Through 1988, Holloway was receiving virtually everything he asked for, but concerned he wasn't receiving enough, he wrote Farm Bureau, the insurer, seeking a policy. He received it, studied it, and assumed he was getting all he could. At the same time, he asked George for a copy of his file; during a move, the file was lost, but George agreed to reconstruct same if Holloway desired. Holloway didn't call back.

Then in 1995, Holloway was again concerned about the benefits he was receiving and called the Michigan Insurance Commission. They advised him to call an attorney, and not knowing anyone, he called information, and asked for any lawyer, say "Lawyer Jones." He got the partner of Jones, and for the first time learned the benefits which were available. To wit, Michigan PIP pays for non-professional attendant care, such that his wife, who cared for him, was entitled to be compensated for same, but for some nine years, 1986-1995, he missed this, unaware it was a benefit. He has since begun to receive same.

In this action, he sued George for negligence, and contended that George had a duty to investigate and learn about the Michigan PIP policy. Also sued was George's employee, John Evans, now of Pittsburgh, who settled his portion of the case for $25,000 before trial. In support of this claim at trial, McMurry called Thomas Hay, Attorney, Michigan, a former MTLA president, who opined about the benefits and Michigan law. Plaintiff's legal liability expert was Lucius Hawes, Attorney, Hopkinsville, who contended there was departure, and that George had a duty to investigate, and could not rely on Holloway's understanding of the PIP.

Damages were valued at $202,440 for the attendant care which represented the payments his wife could have received for helping him, plus another $11,500 for replacement services, i.e., mowing the lawn and other household chores.

George's defense was simple, to wit, he and Holloway specifically agreed that Holloway would handle his own PIP, with George freely admitting he knew nothing about the subject. The only documentary evidence of George's version was the ambiguous fee agreement with the excised portion. His expert, Retired Judge Michael McDonald, Louisville, contended it was reasonable for the parties to contract such that the PIP was excluded from George's representation.

As well, George raised a statute of limitations defense, to wit, at least as early as 1988 when Holloway wrote the letter to Farm Bureau, and received same, he knew or should have known of the problem, yet he waited another seven years.

Plaintiff denied the agreement with George to not handle the PIP, and instead wanted him to handle the whole case; regarding the statute of limitations, he denied knowing of the attendant care until 1995. While not a jury issue, plaintiff was also critical of George for taking a fee from the $50,000, when that figure was already on the table when he received the case.

Attorney George argued his own case in closing pro se, having discharged his counsel/brother, Kevin George, early in trial. He began explaining it wasn't easy or fun to be on the other side, to be a defendant, but explained it is important for a lawyer to be competent, and here the parties specifically agreed that he wouldn't handle the Michigan PIP. Referring to the 10 year gap between suit and the original settlement, he inferred plaintiff was less than honest about what he knew of attendant care, and how it was valued at trial, suggesting less would be appropriate; he noted that he'd received lots of exercise equipment from Farm Bureau, but didn't use it and gave it to a friend. He submitted that at one hour a day for nine years at the hourly rate equaled $27,000, which he lessened by 75% because Seaman handled 75% of the case, again dividing that in half to represent the share of Evans, then arriving at a damage figure of $3,500, which he called a long way from the $215,000 prayer. He reiterated J. McDonald's position, and argued he had never undertaken the PIP at any time. This was opposed to the "street smart" plaintiff who should have known he wasn't receiving full benefits, and who never asked for help in resolving same. He finished, using the instructions, to ask for a verdict in his favor.

McMurry began quoting, Sophocles, such that "never is the advice of a lawyer sweeter than when it promises gain," to illustrate that at the time, his client was desperate and injured, and turned to George to investigate his claim and protect his rights, which he opined a simple phone call would have done. In fact, the amounts claimed for the past attendant care are reasonable, and he pointed to Farm Bureau's payment of same for four hours a day presently as proof. George, he opined, was just after a quick buck, and never did any investigation for Holloway. McMurry argued in favor of his client as to the ambiguous fee agreement, noting there was no other documentation of the PIP exclusion. He then showed the jury a copy of the KTCR, and explained that in a week, Kentucky injury lawyers would read this case, and he hoped they wouldn't get the message that lawyers win when the file isn't documented. The proper message, he suggested, was document the file or suffer the consequences.

In this case, in which George did not have an insurance interest, McMurry had offered to settle the case for $50,000, spread over five years; it was not accepted. The first jury instruction concerned the statute of limitation, and the jury resolved same for Holloway. Then, in an instruction, which was not dispositive, the panel found that the parties agreed the Michigan PIP was excluded. The panel went on to find both George and Evans negligent, apportioning 75% to George, the remainder to the non-party Evans. Holloway was then awarded $159,927 for attendant care, plus $9,085 for replacement services, totaling $169,012, less 25% comparative fault. The interrogatory about the parties agreement, while leading to nowhere in the instructions, was included by the court to deal with a yet unresolved issue of law, to wit, but for that finding, did George still have a duty to investigate. At press time, no judgment had been entered, and the parties were preparing to brief this issue, with George contending the finding was dispositive, and McMurry, the opposite.