Professional Negligence Law Reporter

Thompson v. Harrie, 2019 WL 3494419 (D.S.D. Aug. 1, 2019).

A federal district court predicted that the South Dakota Supreme Court would follow the majority rule and conclude that a legal negligence action may not be assigned to an adversary in underlying litigation.

The district court noted that in general, South Dakota limits assignments of legal claims. There is a common law prohibition on assignment of personal injury claims, the court said, noting the public policy goal of preventing profiteering and speculation in litigation. In the legal context, public policy demands preservation of an attorney’s duty of loyalty and confidentiality, as well as the need for effective advocacy, which would be jeopardized if assignment of legal malpractice claims were to be allowed.

Thus, the court granted a defendant attorney’s motion to dismiss in a case in which a plaintiff entered into an agreement not to execute a judgment against its former adversary in exchange for an assignment of the adversary’s potential claims against its former attorneys.