Gayle A. Sternberg v. Bradley Lechman-SU

In this action for legal malpractice, the trial court

dismissed plaintiff's third amended complaint for failure to

state a claim, ORCP 21 A(8), and on the ground that the

complaint showed that the action was not commenced within

the time limited by statute, ORCP 21 A(9). On appeal, plaintiff

challenges those rulings in her first and second assignments

of error. We conclude that some of plaintiff's specifications

of negligence state a claim and are not barred by the

statute of limitations and, accordingly, reverse and remand

for further proceedings on those specifications. We reject

plaintiff's other assignments of error without discussion.1

On review of the grant of a motion to dismiss under

ORCP 21 A(8) and (9), we accept as true "factual allegations

in the complaint and all reasonable inferences arising from

those allegations.” Johnson v. Babcock, 206 Or App 217, 219,

136 P3d 77, rev den, 341 Or 450 (2006) (discussing ORCP

21 A(8)); see also Guirma v. O'Brien, 259 Or App 778, 780,

316 P3d 318 (2013) (same standard under ORCP 21 A(9)).

We state the relevant facts, which are few, in accordance

with that standard. Plaintiff's malpractice claim arose

from defendant's representation of plaintiff in a dissolution

of marriage case. Plaintiff's former husband worked as an

accountant for the federal government for 38 years. The dissolution

court signed a general judgment on July 17, 2009.

Plaintiff, acting pro se, filed this malpractice action

on July 13, 2011, slightly less than two years after the court

signed the dissolution judgment. On September 7, 2011, she

filed an amended complaint. Defendant moved to dismiss

that complaint for failure to adequately plead causation.

Alternatively, defendant moved to strike certain matters and

1 In her third assignment of error, plaintiff contends that the trial court

abused its discretion when it denied her requests for temporary restraining

orders. In her fourth assignment of error, plaintiff challenges the trial court's

conclusion that, because the trial court record did not reflect that plaintiff had

filed her supersedeas undertaking in the trial court, the court could not rule

on the effectiveness of the supersedeas undertaking. In her fifth assignment of

error, plaintiff contends that the court erred in signing the first order dismissing

her claims without prejudice because the written order contained grounds for

dismissal that the trial court had not mentioned in its oral ruling. As noted in the

text, we reject those assignments of error without published discussion.

Cite as 271 Or App 401 (2015) 403

for an order requiring plaintiff to make more definite and

certain the dates on which she learned of the elements of her

claim against defendant. Plaintiff did not file a response to

defendant's motions, and, after a hearing, the court granted

them but gave plaintiff leave to replead.

Within the time allowed by the court, plaintiff filed

a second amended complaint, which contained more specifications

of negligence and more information about the

existing specifications.2 Defendant moved to dismiss plaintiff's

second amended complaint with prejudice pursuant to

ORCP 54 B(1), which provides that a defendant may move

for a judgment of dismissal "[f]or failure of the plaintiff to

* * * comply with * * * any order of the court,” and ORCP 21

"because of (1) Plaintiff's failure to comply with this Court's

Order on Defendant's first ORCP 21 motions, (2) Plaintiff's

[Second] Amended Complaint's failure to state facts sufficient

to state a claim for relief, and (3) the fact that Plaintiff's

claim is barred by the statute of limitations.” Again, plaintiff

filed no response. Plaintiff did not appear at the hearing

on the motion, and the court granted the motion and dismissed

under ORCP 21, but gave plaintiff leave to replead

before January 30, 2012.

Plaintiff repleaded on January 30. Again, her new

complaint contained more information than the last one

had. Defendant moved to dismiss that third amended complaint

with prejudice on the same grounds identified in his

second motion. Again, plaintiff filed no written response,

but she did appear and present argument at a hearing on

defendant's motions.

The statute of limitations was the only topic of discussion

at that hearing. In accordance with some of the allegations

in the third amended complaint, plaintiff argued that

her claims were not time barred because (1) she had reasonably

relied on her attorney to represent her adequately and

had not discovered his failures until after the dissolution

2 Because plaintiff entitled all of her complaints apart from the very first

one—which she amended before defendant filed any response—"Complaint

(Amended),” the parties and the court did not refer to them by uniform terms.

We refer to the amended complaints as the first, second, and third amended complaints,

reflecting the order in which plaintiff filed those pleadings.

404 Sternberg v. Lechman-Su

judgment was signed, which was less than two years before

she filed this action, and (2) she was not actually harmed

until after the judgment was signed. Defendant, through

counsel, disagreed. He contended that plaintiff had known

all of the relevant facts before the dissolution judgment was

signed and that, because "one or more of [plaintiff's] claims

are barred by the statute of limitations,” "the entirety of her

lawsuit is * * * barred by the statute of limitations.”

The court granted defendant's motion:

"Okay. So Ms. Sternberg, the Court has reviewed all of

the pleadings again, and finds once again that you haven't

complied with the Court's orders. * * *

"And you know, you haven't corrected the defects that

we had noted before in the [first amended] complaint and

the [second] amended complaint, and to the extent that there

are—appear to be claims that may have been pled, that may

constitute malpractice claims, on the face of the pleading

here, they're barred by the statute of limitations.

"So we are going to have to dismiss the case, and we've

given—this is the third opportunity to have you try to state

cognizable claims, and they just—it's just not there.

"So we have to dismiss the complaint with prejudice at

this point * * *.

"But the Court has given you ample opportunity to try

and state cognizable claims and really has gone out of its

way to give you every opportunity to do that, and it just looks

like the claims that you're attempting to state are barred by

the statute of limitations because of the time periods that

are involved.”

(Emphases added.) Accordingly, the court entered an order

granting defendant's motion and a general judgment of

dismissal.

On appeal, plaintiff assigns error to the dismissal,

asserting that her third amended complaint did state a claim

and was not barred by the statute of limitations. Defendant

responds that many of plaintiff's specifications were barred

by the statute of limitations. He also contends that, despite

the trial court's order that plaintiff state with specificity

when she had learned that defendant's acts and omissions

Cite as 271 Or App 401 (2015) 405

had caused her harm, plaintiff failed to allege those dates.

Accordingly, defendant contends, "[t]he trial court's action

[(dismissal)] to enforce its prior orders, particularly given

the allegations before the trial court that showed Plaintiff

knew of her claims more than two years before she filed her

lawsuit, was proper and should be affirmed.”

At the outset, we note that the court did not express

any intention to dismiss adequately pleaded claims as a penalty

for failure to comply with its orders in other respects.

Rather, as demonstrated by the court's statements at the

hearing, quoted above, the court concluded that none of

plaintiff's specifications of negligence stated a claim that was

not time barred. In light of that conclusion—and defendant's

arguments, both below and on appeal, tying the ORCP 54

B(1) motion to the contention that none of the claims have

merit—we do not understand defendant's motion to dismiss

under ORCP 54 B(1), and the court's grant of that motion, to

affect any adequately pleaded claims. Accordingly, we need

not, and do not, consider whether a court may dismiss an

adequately pleaded claim as a sanction for failure to comply

with a court order requiring more specificity and, if it may,

whether it must make findings before doing so. See Johnson

v. Eugene Emergency Physicians, P.C., 159 Or App 167, 171,

974 P2d 803, rev den, 329 Or 126 (1999) (accepting, for purposes

of deciding the case, the parties' agreement that "the

standards applicable to a sanction for a discovery violation

under ORCP 46 B(2) are also applicable to ORCP 54 B(1)”;

ORCP 46 B(2) requires "findings of fact and [an explanation

of] why the sanction of dismissal is 'just' ”); Horton v. Nelson,

252 Or App 611, 615-21, 288 P3d 967 (2012) (reviewing for

whether the complaint stated a claim after dismissal that

was based, in part, on failure to comply with order of the

court about content of pleading).

Thus, our task is to determine whether any of

plaintiff's specifications of negligence both state a claim

and include allegations that would allow a reasonable

trier of fact to determine that the claim is timely. We conclude

that some—but not all—of the specifications do both.

Accordingly, we reverse and remand for further proceedings

on only those specifications of negligence, which we identify

below.

406 Sternberg v. Lechman-Su

To state a claim under ORCP 21 A(8), "a complaint

must contain factual allegations that, if proved, establish

the right to the relief sought.” Moser v. Mark, 223 Or App 52,

57, 195 P3d 424 (2008). The elements of a legal malpractice

claim are "(1) a duty that runs from the defendant to the

plaintiff; (2) a breach of that duty; (3) a resulting harm to

the plaintiff measurable in damages; and (4) causation, i.e.,

a causal link between the breach of duty and the harm.”

Stevens v. Bispham, 316 Or 221, 227, 851 P2d 556 (1993)

(emphasis in original); see also Kaseberg v. Davis Wright

Tremaine, LLP, 351 Or 270, 277, 232 P3d 970 (2011) (elements

of a legal malpractice claim are harm, causation, and

tortious conduct). "To [plead] causation, the plaintiff must

[allege] that, but for the defendant's negligence, the plaintiff

would not have suffered the claimed harm. In a legalmalpractice

action, the plaintiff does so by [alleging facts

that demonstrate] that he or she would have obtained a

more favorable result had the defendant not been negligent.”

Woods v. Hill, 248 Or App 514, 524, 273 P3d 354 (2012) (citation

omitted).

Because the trial court dismissed some of plaintiff's

specifications of negligence as untimely under ORCP

21 A(9), we must also evaluate whether the facts alleged,

"if proved, would allow a reasonable trier of fact to find that

the action was commenced within the time limited by statute.”

Guirma, 259 Or App at 780 (citing Doe v. Lake Oswego

School District, 353 Or 321, 334, 297 P3d 1287 (2013)). "A

professional negligence action must be filed within two years

of the date on which the claim accrues.” Id. at 779 (citing

ORS 12.010; ORS 12.110(1); and U.S. Nat'l Bank v. Davies,

274 Or 663, 665-66, 548 P2d 966 (1976)). A legal malpractice

claim accrues when "the client knows or, in the exercise

of reasonable care, should know 'every fact which it would be

necessary for the [client] to prove * * * in order to support his

right to judgment.' ” Kaseberg, 351 Or at 277 (quoting Davies,

274 Or at 666-67) (some internal quotation marks omitted).

Accordingly, a legal malpractice claim accrues "when the client

knows or, in the exercise of reasonable care, should know

that there is a substantial possibility that (1) he or she has

suffered harm, (2) the harm was caused by the lawyer's acts

or omissions, and (3) the lawyer's acts or omissions were tortious.”

Guirma, 259 Or App at 779-80.

Cite as 271 Or App 401 (2015) 407

As to the statute of limitations, then, we must determine

whether the facts alleged in plaintiff's complaint, and

all favorable inferences that can be drawn from those facts,

raise a question of fact about whether plaintiff did not know

and, in the exercise of reasonable care, would not have known

of a substantial possibility that (1) she suffered harm, (2) the

harm was caused by defendant's actions or omissions, and

(3) defendant's acts or omissions were tortious, until at least

July 13, 2009, two years before plaintiff filed this action.

Contrary to defendant's contention before the trial court, we

make that determination on a specification-by-specification

basis. Gaston v. Parsons, 318 Or 247, 260, 864 P2d 1319

(1994) ("Just because one specification of negligence in a

complaint is barred by the statute of limitations, it does not

necessarily follow that a specification of negligence having a

different factual or legal basis is barred.”).

Plaintiff's third amended complaint includes 49

specifications of negligence. With respect to each of those

allegations, plaintiff alleges that she "began to learn of the

consequences, implications, and finality of Defendant's misconduct

after the original [dissolution] judgment had been

signed.” We have kept that allegation in mind as we have

reviewed each of plaintiff's specifications of negligence.

Based on that review, we have determined that the following

specifications state a claim and at least raise a question

of fact about whether they are time barred. Extended discussion

would not benefit the parties, the bench, the bar,

or the public; accordingly, as to each of these specifications,

we restate plaintiff's claim as we understand it and briefly

note why it is not time-barred. In one case, we have grouped

specifications that address a similar subject together. The

specifications other than those listed below fail to state a

claim, on their face are barred by the statute of limitations,

or both.

• Allegations in paragraph 7: Defendant failed to

depose the husband in the dissolution proceeding,

and that failure caused defendant not to have information

about specific marital assets. The lack of

information about those assets resulted in improper

allocation of assets to the husband—that is, if

defendant had deposed the husband, the result of

408 Sternberg v. Lechman-Su

the property division would have been more favorable

to plaintiff. Plaintiff learned of the additional

assets in 2010. We conclude that a factfinder could

determine, from those allegations, that, until then,

although plaintiff knew or should have known that

defendant had not deposed the husband, she did not

know, nor should she have known, as a matter of

law, that his failure to do so had caused her harm.

• Allegations in paragraphs 12, 44, and 50: Defendant

used the value of a joint Smith Barney account at

the time of the trial, rather than the value of the

account at the time of filing, in calculating the

property division. That caused injury to plaintiff

because the husband had withdrawn $45,000 from

the account between the time of filing and the time

of trial. Certain withdrawals from that account by

the husband resulted in the creation of a margin

account debt of $66,000; defendant's failure to allocate

those withdrawals to the husband also resulted

in plaintiff being responsible for half of that debt. A

factfinder could determine, from plaintiff's allegations,

that she was not harmed by defendant's conduct

until the judgment was entered, less than two

years before she commenced this action.

• Allegations in paragraph 13: In accordance with an

order of the court, the husband withdrew $126,135

from the Smith Barney account as a predistribution

from the husband's share of that account. Defendant

failed to include the predistribution in the allocation

of that account in the property division, causing

plaintiff a loss of $63,068. A factfinder could

determine, from plaintiff's allegations, that she was

not harmed by defendant's failure to include the

predistribution in the property division until the

judgment was entered.

• Allegations in paragraph 14: On several occasions,

defendant failed to memorialize the oral interim

support agreement between plaintiff and the husband

in writing. That agreement was that, during

the dissolution, plaintiff and the husband would

Cite as 271 Or App 401 (2015) 409

pay their living expenses from the husband's salary;

they would not use preexisting assets for living

expenses. When the husband stopped paying plaintiff

interim support, defendant incorrectly advised

plaintiff that her withdrawals from the Smith

Barney account for her living expenses would be

treated as interim support and so accounted for in

the final judgment. That failure caused plaintiff to

unnecessarily spend part of her share of the marital

assets on living expenses during the dissolution.

Although plaintiff knew that the husband had

stopped paying her interim support, defendant's

assurances that her withdrawals from the Smith

Barney account would be treated as interim support

in the judgment create a question of fact as to

whether she knew or should have known before the

judgment was entered that defendant's failure to

put the agreement in writing had harmed her.

• Allegations in paragraph 42: Defendant erroneously

allowed plaintiff to be charged twice in the property

division for an IRA contribution of $2,500, causing

her a loss of $2,500. A factfinder could determine

from plaintiff's allegations that plaintiff was not

harmed until the judgment was entered.

• Allegations in paragraph 54: Defendant miscalculated

the coverture fraction by using 273 as the

number of months of marriage, rather than the correct

number, 288. That resulted in entitlement to

less future retirement income for plaintiff than if

defendant had used the correct number of months.

A factfinder could determine from plaintiff's allegations

that plaintiff was not harmed by defendant's

incorrect coverture fraction calculation until the

judgment was entered.

• Allegations in paragraph 55: The husband purchased

approximately 36 additional "months of

retirement” in his retirement plan with marital

funds, causing those months to be marital assets.

Defendant failed to designate those months as marital

assets, causing plaintiff a loss of her share of

410 Sternberg v. Lechman-Su

the husband's retirement benefits accrued over an

additional 36 months. A factfinder could determine

that plaintiff was not harmed by defendant's incorrect

designation of the additional 36 months until

the judgment was entered.

• Allegations in paragraph 56: Defendant failed to

seek long-term spousal support for plaintiff. If he

had done so, the court would have awarded her

$2,200 per month in light of the fact that she had

been a stay-at-home mother for 20 years in a 24-year

marriage, taking care of the parties' children and

the husband's parents and maintaining the home,

and the fact that plaintiff, now employed, earns half

what the husband does and receives many fewer

benefits than he does. A factfinder could determine

that plaintiff was not harmed by defendant's failure

to obtain long-term spousal support until the judgment

was entered.

Reversed and remanded.