A. Statutes of limitations time periods
The statute of limitations refers to the time that a plaintiff has to initiate a lawsuit before the claim is time-barred.
In Washington, a former client must bring a claim for legal malpractice within three (3) years of the date that the client first knew or reasonably should have known: 1) that the lawyer made a negligent mistake, and 2) that the mistake damaged the plaintiff.
In Oregon, a former client must bring a claim for legal malpractice within two (2) years of these circumstances.
B. Discovery rule applied
Whether and when a client should reasonably have discovered that a lawyer was negligent and that the negligent mistake caused damage can be a hotly contested issue in a legal malpractice case. Because the question can often be highly subjective, it is advisable that a client err on the side of caution, by not making overly optimistic assumptions about when a court would determine that the claim should have been discovered, and by seeking legal malpractice counsel promptly once a claim has been discovered.
It is important to bear in mind that the statute of limitations is not suspended until the client becomes aware of a "claim" for malpractice (and damages). Instead, the time period beings to run once the client is aware (or should reasonably have been aware) of the facts giving rise to the claim.
It is also important for a client to keep in mind that it is not enough for a client seeking to avoid imputation of earlier discovery of damage to argue that he or she could not reasonably have known the full extent of the harm. It is enough to start the clock on a claim for legal malpractice if the client knows or reasonably should know that the lawyer’s mistake merely caused "some harm."
Also, if the client suspects or should reasonable suspect that a negligent mistake lies at the heart of some damage, under certain circumstances there could be a "duty to investigate" such that the client must take reasonable action to become better informed. In such circumstances, the client cannot sit back indefinitely, claim ignorance, and argue that the statute of limitations did not start to run.
C. Statutes of Ultimate Repose
These standards involve what is referred to as a "discovery rule" because the time does not start to run until the client actually discovers, or reasonably should have discovered, whether a claim exists. However, some states have "statutes of ultimate repose," which impose a final time limit irrespective of whether the plaintiff knew or reasonably should have known that there was a claim or that there were damages.
Washington has no such statute of ultimate repose for legal malpractice claims. Theoretically, a former client could bring suit more than 10 years, for instance, after the negligent act or omission of counsel. But defendants could still assert an equitable defense that the passage of time was too great. Also, practical considerations, including availability of documentary evidence, witnesses, and insurance, can make such a claim very difficult regardless.
Unlike Washington, Oregon does have a statute of ultimate repose for legal malpractice claims. In Oregon, a claim for legal malpractice becomes time-barred 10 years after the allegedly negligent act or omission of the attorney. For example, suppose a client is reasonably unaware that his or her former lawyer made a negligent mistake and/or that the mistake caused damage, until 9 years after the mistake. Suppose the client files a lawsuit 1 year and 2 months after this discovery. Even though it is within the 2 year statute of limitations for filing the claim in Oregon, the claim is still time-barred and subject to dismissal because it is outside the 10 year statute of ultimate repose.
Tolling (pausing) the time period to bring a lawsuit
There are various circumstances which may "toll" (pause) the statute of limitations for bringing a lawsuit for attorney malpractice. In some states, there is a "continuous representation" rule for legal malpractice claims, based on which the clock on a claim for malpractice against one’s lawyer does not begin to tick until the legal representation relating to the matter in which the malpractice was committed has been terminated. This rule reflects the public policy of encouraging clients and lawyers to find solutions to potential problems without the time pressures associated with a statute of limitations for legal malpractice.
Washington has a continuous representation rule, potentially extending the time for bringing a legal malpractice claim. Oregon appellate courts have not yet formally recognized such a rule. However, Oregon’s application of a similar rule in medical malpractice cases has led to some informed speculation that it is only a matter of time before Oregon formally adopts a continuous representation rule for legal malpractice cases also, once a case presenting the issue is squarely before the Oregon appellate courts for a binding decision.
There are other ways that the statute of limitations on a claim for legal malpractice could be tolled. One common way is for the former client and the lawyer to enter into a tolling agreement. Often this is done when the parties wish to explore settlement possibilities without a lawsuit pending. If settlement discussions are taking place toward the end of the limitations period, then without a tolling agreement the former client would feel pressured to initiate a lawsuit to prevent the claim from becoming time-barred. A tolling agreement can alleviate this pressure by allowing the parties to negotiate a solution without litigation. For the defendant who seeks a settlement with confidentiality provisions, a pre-litigation settlement may be attractive.
Other circumstances that might toll the statute of limitations on a claim for lawyer malpractice include periods during which the client or former client may have lacked capacity, due to age or disability for example.