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What is the standard of proof for a “settle and sue” claim?

If you’re harmed by your lawyer’s negligence, you might file a legal malpractice claim. Winning such a claim requires you to prove your lawyer acted badly, that his or her negligence directly harmed your case and that you can measure the harm in quantifiable damages.

But how can you prove your lawyer’s negligence harmed your case when you settled it? How can you prove your lawyer’s failures led directly to specific economic damages? What is the standard of proof that you need to meet? These are questions that California’s Fifth District Appellate Court recently addressed with an opinion that may soon be destined for review before the state’s Supreme Court.

Preponderance of evidence versus legal certainty

As Bloomberg Law noted in its look at the opinion, it draws renewed attention to the ambiguous language surrounding “settle and sue” cases. In a settle and sue case, you might settle your case either before or after you suspect your attorney has committed malpractice. Then, once you suspect your attorney’s malpractice has significantly harmed your settlement, you would sue for the difference between the settlement you reached and the fair settlement you would have reached if not for your lawyer’s failures.

The problem is that, as we have noted previously, settlements hinge on many factors. They involve two or more parties, and each party engages in the negotiations as it sees fit. The result is that it’s difficult to pin down the ties between a lawyer’s malpractice and the damages in a settlement. You can work toward the proof, but this is a time when the standards for your proof make a big difference.

That’s why the appellate court’s recent opinion is so important. It adds new fuel to the ongoing debate over this standard of proof. The competing standards are:

  • A preponderance of evidence
  • Legal certainty

On the one hand, you have the California evidence code, which says, “Except as otherwise provided by the law, the burden of proof requires proof by a preponderance of the evidence.”

On the other hand, there are numerous rulings in which California’s courts, even appellate courts, have cited a need for “legal certainty.” This means speculative evidence is not good enough. Still, numerous attorneys, such as the one defending the recent malpractice case, have claimed this phrase also sets a higher standard for settle and sue cases. They claim a preponderance of evidence is not enough.

What does this mean for my legal malpractice case?

Most cases settle. Yet very few settlements lead to malpractice claims. This isn’t necessarily because lawyers serve their clients more dutifully during settlements. You might find as much opportunity for attorneys to commit malpractice during cases that settle as in cases that head to trial. But people looking to raise malpractice claims after settling face a higher burden of proof.

This burden is currently higher due to the added complexity of the settlement process. The burden could also be higher if the courts decided to adopt “legal certainty” as a higher standard for the burden of proof. The Fifth District’s recent opinion pushes against this extra hurdle, at least for now.