Clause Limiting Time Client Can Sue Attorney Violates Public Policy

Jennifer Nelson for www.theindianalawyer.com

The contract a client signed to have the Conour Law Firm represent her contained a clause limiting her ability to sue the firm to one year, which the Indiana Court of Appeals found violated public policy and the Indiana Rules of Professional Conduct. The lawsuit seeking to recover settlement funds stolen by William Conour continues against his former colleague.

Rene DiBenedetto entered into a contract with the Conour Law Firm in April 2010 to have the firm represent her in an automobile accident. Her case settled, but she never received any of the settlement money. Timothy Devereux at that time worked at the law firm and met with DiBenedetto about her case. He left the firm at the end of 2011, and in April 2012, Conour was charged with wire fraud for stealing millions from clients. DiBenedetto filed her lawsuit against Devereux in October 2013.

She alleged Devereux breached a “duty to make sure that the law firm would make reasonable efforts to ensure that the firm had in effect measures giving reasonable assurance that all lawyers and non-lawyers in the firm conform to the Rules of Professional Conduct.” She contended Devereux “is liable for Rene DiBenedetto’s loss of settlement proceeds” by virtue of his employment relationship with Conour.

Devereux moved for summary judgment, which the trial court denied. In Timothy Devereux v. Rene DiBenedetto, 49A02-1411-CT-780, he argued that DiBenedetto was bound by the one-year limitation in her contract with the law firm as to when she could bring a lawsuit, and she had one year after Conour’s arrest to file the suit.

There have been no Indiana decisions addressing shortening the period of limitations for legal action against an attorney. The judges looked toCharnay v. Cobert, 51 Cal. Rptr. 3d 471, 481 (Cal. Ct. App. 2006), a legal malpractice decision regarding a clause in a billing contract requiring the client to contest the bill within 10 days or be bound by it. That court noted a contractually shortened limitations period has not been upheld outside of straightforward transactions.

“We agree with the Charnay analysis and find it consistent with Indiana Rule of Professional Conduct 1.8(h). The clause in DiBenedetto’s contract with the Firm that shortens the time for filing a lawsuit violates public policy and is void. Therefore, the trial court properly denied Devereux’s motion for summary judgment. We expressly decline to comment on the merits of DiBenedetto’s action against Devereux. The opinion should be read to address the issue of the limitations clause found in the contract between DiBenedetto and the Firm, and nothing else.