Professional Negligence Law Reporter

A Nevada appellate court held that a former client’s legal malpractice claim accrued when she incurred actual, appreciable damages.

Lynita Nelson and her then-husband, Eric, retained attorney Jeffrey Burr to create an estate plan. The couple established separate revocable trusts and later moved assets into individual self-settled spendthrift trusts. Burr allegedly advised the couple to level off their assets by transferring assets between the trusts. In 2009, Eric filed for divorce. The divorce court later issued a decree equalizing the value of the assets between the trusts and ordering that alimony and child support be paid directly from Eric’s trust. In May 2017, however, the Nevada Supreme Court reversed. Less than two years later, Lynita sued Burr, alleging legal malpractice. The defendant moved to dismiss, arguing that the plaintiff’s claims were time-barred by the limitations period in Nev. Stat. Ann. §11.207(1). The court granted the motion.

Reversing and remanding, the appellate court held that a legal malpractice claim must be commenced within four years after the plaintiff sustains damage or within two years after the plaintiff discovers material facts constituting the cause of action. Citing case law, the court added that a plaintiff must sustain actual and appreciable damages under either timeframe. Here, the court said, the earliest that the plaintiff could have discovered she had suffered actual damages from the defendant’s advice was when the state high court reversed the trial court’s order in May 2017. Before the high court’s decision, the plaintiff had not incurred any damages, and any future damages were, at most, speculative, the court said. Consequently, the plaintiff’s complaint, filed within two years of the state high court’s ruling, was not time-barred.

Citation: Nelson v. Burr, 2021 WL 3701471 (Nev. Ct. App. Aug. 18, 2021).

Plaintiff counsel: Curtis Rawlings, Henderson, Nev.