Common Sense Reigns – Epstein is Dead – Sort of
Since 2005, legal malpractice attorneys in South Carolina have been navigating the pitfalls of determining the statute of limitations under Epstein v. Brown, 610 S.E.2d 816. For those unfamiliar with Epstein, here is the skinny: Doctor gets hammered by a jury; lawyer tells Doc not to worry because the verdict will get reversed on appeal; after MORE THAN THREE YEARS on appeal, the verdict is upheld; Doctor sues lawyer; Supremes say “not so fast” – the statute of limitations was deemed to have commenced upon the return of the adverse verdict notwithstanding the fact that the same lawyer appealed the verdict; as a result, the legal malpractice case was time barred. EPSTEIN RATIONALE: The good Doctor knew that he was harmed upon the return of the verdict and the appeal was nothing more than an effort in mitigation. Tricky, right?
RIGHT. In Stokes-Craven Holding Corp. v. Scott Robinson, Opinion No. 27572 (Sept. 9, 2015), the Supremes returned to Epstein and tossed it. Like Epstein, Stokes-Craven involved another “trial gone wrong” underlying case and subsequent unsuccessful appeal. Also like Epstein, the same lawyer represented the client on both the trial and appellate levels. Although the Stokes-Cravenopinion points out factual distinctions between the two cases, the opinion reads much more like our Court availing itself of an opportunity to kill a poor precedent that left South Carolina in the noted minority of jurisdictions around the Country which failed to adopt the continuous representation rule to toll the running of the statute of limitations in situations such as these. While not adopting the continuous representation rule, our Court did adopt a new rule that strikes a pretty fair middle ground between Epstein and the majority.
Here is how the compromise works: 1) we still recognize the “discovery rule” in determining the statute of limitations for legal malpractice; 2) the statute does not begin to run until the client is aware of all four elements of the cause of action (duty, breach, causation, damage); 3) the statute “MAY” be tolled during an appeal provided the client is not aware that he or she has been harmed by errors of the attorney; and 4) the final outcome of an appeal represents the outer limit of the time for tolling purposes (ie. the client can say prior to the affirmation of an appeal that he or she did not appreciate that they were harmed by errors of the attorney, but the client better wake up when the final decision is rendered).
CAUTION: The new rule does NOT adopt the continuous representation rule and it does NOT say that the statute of limitations is automatically tolled during the pendency of an appeal. For example, what if the client writes an email that says in essence “my lawyer stinks, but I will let her try to fix this mess on appeal even though it’s costing me a fortune?” One should expect that the time is not tolled for this client. While we would still advocate that the continuous representation rule should prevail, the Stokes-Craven test seems a reasonable compromise that embraces the longstanding discovery rule in South Carolina. The bottom line is this: The objective test of Epstein has been replaced by the subjective test of Stokes-Craven. Determining the commencement date for the running of the statute of limitations in legal malpractice remains a complicated matter, although Stokes-Cravenappears far more client-centric than its predecessor.
Ronnie Richter and Eric Bland