Summary
The Louisiana Fourth Circuit Court of Appeal affirmed the dismissal with prejudice of a legal malpractice action based on peremption under La. R.S. 9:5605. The court held that the plaintiff knew or should have known of the alleged malpractice by December 2022, and that the action filed in August 2024 was untimely. The court also held that the statutory fraud exception did not apply because fraud was not pleaded with particularity.
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Practice areas
Questions Presented
- Whether Hymes's legal-malpractice claims were perempted under La. R.S. 9:5605(A) because he knew or should have known of the alleged malpractice by December 2022 but did not file suit until August 26, 2024.
- Whether the fraud exception in La. R.S. 9:5605(E) applied notwithstanding Hymes's failure to plead fraud with particularity.
- Whether the trial court improperly conflated foreclosure with discovery of malpractice or ruled without conducting a full evidentiary hearing.
Holdings
- The legal-malpractice claims were perempted because Hymes's own account established that he knew or should have known of the alleged malpractice by December 2022, yet he did not file suit until August 26, 2024, more than one year after discovery.
- The fraud exception in La. R.S. 9:5605(E) did not apply because Hymes failed to plead fraud with particularity.
- The trial court neither improperly conflated foreclosure with discovery of malpractice nor ruled without a full evidentiary hearing.
Key quotations
“If evidence is introduced at the hearing on the peremptory exception of preemption, the district court’s findings of fact are reviewed under the manifest error-clearly wrong standard of review.” (2)
“No action for damages against any attorney at law duly admitted to practice in this state, any partnership of such attorneys at law, or any professional corporation, organization, association, enterprise, or other commercial business or professional combination authorized by the laws of this state to engage in the practice of law, whether based upon tort, or breach of contract, or otherwise, arising out of an engagement to provide legal services shall be brought unless filed in a court of competent jurisdiction and proper venue within one year from the date of the alleged act, omission, or neglect, or within one year from the date that the alleged act, omission, or neglect is discovered or should have been discovered; however, even as to actions filed within one year from the date of such discovery, in all events such actions shall be filed at the latest within three years from the date of the alleged act, omission, or neglect.” (3)
“La. C.C.P. art. 853 and the established jurisprudential authority require that fraud be pled with particularity.” (3-4)
“Foreclosure was the very thing that Mr. Hymes retained Mr. Schmidt to stop. Its occurrence was notice of the discovery of legal malpractice according to Mr. Hymes’ own version of events.” (4)
Factual background
Hymes retained Schmidt and Koch and Schmidt, LLC on September 30, 2021, to represent him in negotiations concerning foreclosure proceedings against his residence. Hymes alleged that Schmidt failed to advise him about critical installment obligations during settlement negotiations, resulting in foreclosure, loss of home equity, and business damages. Hymes's disciplinary complaint stated that he learned in December 2022 that the property had been foreclosed on November 9, 2022, and that no signed settlement agreement was on file. He filed his legal-malpractice petition on August 26, 2024.
Procedural history
Hymes sued Schmidt and Koch and Schmidt, LLC for legal malpractice arising from foreclosure proceedings involving Hymes's residence. The trial court maintained the defendants' peremptory exception of peremption and dismissed the action with prejudice. Hymes appealed, challenging the peremption ruling, the application of the fraud exception, and the adequacy of the evidentiary proceedings.