Facts
- Alissa Mechille Humphreys (also referenced as Alissa Humphreys Dorton) anticipated an uncontested divorce from her husband after a 16-year marriage.
- In March 2000, she contacted William C. Argabrite, a Kingsport, Tennessee attorney who had previously done legal work for the couple, initially seeking a referral to a divorce lawyer.
- Although Argabrite had limited divorce experience, he ultimately represented Humphreys in the divorce proceedings.
- Before retaining Argabrite, Humphreys and her husband had already agreed on the basic deal: an equal split of marital assets, Humphreys would have primary custody of their two children, and Humphreys would receive $10 million in cash as her share of certain family business interests.
- The $10 million would be paid in annual installments over 15 years and, by agreement, would not bear interest.
- The divorce terms also did not provide Humphreys alimony, and she understood before finalization that she would not receive alimony.
- Humphreys also knew before the divorce became final that the child-support amount would be lower than Tennessee guideline levels.
- At some point after the settlement structure was in place, Humphreys learned her former husband paid $6.5 million for an annuity intended to fund the installment payments; she asked what happened to the remaining $3.5 million, and (according to her account) Argabrite questioned why she cared how the settlement was funded.
- Humphreys later claimed Argabrite negligently advised her regarding (1) the lack of interest on the installment payments, (2) the absence of alimony, and (3) the child-support level.
- The divorce decree became final in December 2000.
- Humphreys did not file suit against Argabrite and his firm, Hunter, Smith & Davis, LLP, until September 8, 2003, in federal court under diversity jurisdiction.
- The district court granted summary judgment to the defendants, concluding the action was barred by Tennessee’s one-year statute of limitations for legal malpractice.
Issues
- Under Tennessee’s discovery rule for legal-malpractice claims, did Humphreys’s cause of action accrue no later than the date the divorce decree became final (making her 2003 suit untimely under the one-year limitations period), rather than when later counsel allegedly told her she had a malpractice claim?
Decision
- The Sixth Circuit affirmed summary judgment for Argabrite and the law firm.
- The court held the legal-malpractice claim was time-barred under Tennessee’s one-year statute of limitations.
- The court concluded Humphreys knew, or should have known through reasonable diligence, of the alleged injury and its connection to Argabrite’s advice by the time the divorce decree became final in December 2000; she therefore had until about December 2001 to sue.
Legal Principles
- In a diversity case, federal courts apply state substantive law, including state statutes of limitations and state accrual rules for the claim at issue.
- Tennessee imposes a one-year statute of limitations for legal-malpractice actions. See Tenn. Code Ann. § 28-3-104(a)(2).
- Under Tennessee’s discovery rule, a legal-malpractice claim accrues when the plaintiff knows or, with reasonable care and diligence, should know (1) that an injury occurred and (2) that the injury was caused by the defendant’s conduct.
- Accrual turns on awareness of the operative facts showing injury and causation; it does not wait until the plaintiff receives confirmation from another lawyer that those facts amount to malpractice.
- Summary judgment is appropriate when the record shows no genuine dispute of material fact and the movant is entitled to judgment as a matter of law; when the limitations bar is clear on undisputed timing facts, judgment may be entered as a matter of law.
Conclusion
The Sixth Circuit held that Humphreys’s malpractice claims based on Argabrite’s advice about interest, alimony, and child support accrued no later than the final divorce decree in December 2000 because Humphreys understood the settlement terms and their financial effects at that time; Tennessee’s one-year limitations period therefore expired well before she filed suit in September 2003, so summary judgment for Argabrite and his firm was affirmed.