## Facts

- In July 1996, George Koutsogiannis financed the purchase of a new car with a loan from United Carolina Bank, later merged into BB&T.
- In May 1999, Koutsogiannis made his full monthly payment in cash, but the bank’s records incorrectly treated it as only a partial payment, and BB&T claimed he still owed $23.76.
- Based on the bank’s recording error, BB&T began collection activity and reported the account as delinquent.
- BB&T referred the matter to a third-party attorney to assist with collection and to communicate with Koutsogiannis’s counsel.
- Koutsogiannis continued making regular payments for several months, but in October 1999 he stopped paying because BB&T could not provide a correct payoff amount while the bank continued collection efforts.
- The parties attempted to resolve the dispute through counsel, including discussing payoff figures and correction of the credit reporting, but they did not reach a final agreement.
- During the dispute, Koutsogiannis entered a contract to purchase commercial land for $122,000 that appraised at $210,000; he alleged he lost the deal because of the negative credit reporting tied to BB&T’s error.
- BB&T sued Koutsogiannis to recover the amount it claimed was due on the auto loan.
- Koutsogiannis filed counterclaims against BB&T for libel, conversion, breach of contract accompanied by fraudulent intent, and gross negligence, seeking damages based on BB&T’s conduct and on alleged misconduct by BB&T’s attorney during negotiations and in litigation filings.
- The trial court granted summary judgment on BB&T’s claims and Koutsogiannis’s counterclaims in an order drafted by BB&T’s attorney.
- The South Carolina Court of Appeals reversed, concluding Koutsogiannis had not been given a meaningful opportunity to argue the merits of his counterclaims.
- After remand, Koutsogiannis paid off the loan and the case proceeded to a jury trial on the counterclaims.
- The jury returned a verdict for Koutsogiannis only on the gross-negligence counterclaim and awarded $98,000 in damages; the verdict did not state whether it was based on BB&T’s actions, the attorney’s actions, or both.
- BB&T appealed, arguing the trial court should have instructed the jury on independent-contractor law to prevent vicarious liability for its attorney’s conduct; the trial court had instead instructed the jury on agency law.

## Issues

1. Did the trial court err by refusing to charge the jury on independent-contractor law regarding BB&T’s outside attorney?

## Decision

- The Supreme Court of South Carolina affirmed.
- The trial court did not err in refusing BB&T’s requested independent-contractor instruction.
- The agency instruction given to the jury correctly stated South Carolina law governing the attorney-client relationship and the attribution of an attorney’s acts to the client when performed within the scope of representation.
- On the evidence presented, the attorney’s complained-of actions (including settlement communications and litigation-related drafting) were within the scope of his authority as BB&T’s legal representative, so an independent-contractor charge was not required.

## Legal Principles

- Jury instructions are reviewed as a whole; reversal requires both legal error and prejudice.
- In South Carolina, the attorney-client relationship is treated as a principal-agent relationship; acts by an attorney within the scope of the representation may be attributed to the client.
- A party is not entitled to a requested instruction unless it is supported by the evidence and is necessary to state the law applicable to the case.
- When the evidence shows the challenged conduct consists of litigation and settlement actions undertaken by counsel as the client’s representative, an agency instruction can adequately guide the jury, and the court need not also give an independent-contractor instruction aimed at insulating the client from vicarious responsibility.

## Conclusion

The Supreme Court of South Carolina affirmed the judgment for Koutsogiannis on his gross-negligence counterclaim, holding that the trial court properly instructed the jury on agency principles governing an attorney’s acts on behalf of a client and did not commit reversible error by declining to instruct on independent-contractor law where the attorney’s conduct at issue fell within the scope of representation for BB&T.


Koutsogiannis v. BB&T, 616 S.E.2d 425 (2005)