## Facts

- Joel M. Smith and Delbert N. Murray (through his estate) invested with developer Bill Bashor in a Wild Dunes lot-purchase and development plan intended to generate resale profit.
- Haynsworth, Marion, McKay & Geurard represented Bashor in acquisitions and sales related to the project and also represented Smith and Murray in the same transaction, with Bashor paying Smith and Murray’s legal fees.
- Two partners of the Haynsworth firm were also investors in the development scheme.
- The project failed, the lots were foreclosed by the bank, and Smith and Murray sued the law firm for legal malpractice.
- To prove the standard of care and breach, plaintiffs sought expert testimony from a law professor regarding the South Carolina Rules of Professional Conduct and their relationship to the malpractice standard of care.
- The trial court excluded the expert, reasoning he was not licensed in South Carolina and was not a real estate practitioner, and the jury returned a verdict for the law firm.
- Plaintiffs appealed, also challenging a jury instruction concerning powers of attorney.

## Issues

1. Whether the trial court erred by excluding plaintiffs’ expert testimony on the professional standard of care and the relevance of the Rules of Professional Conduct.
2. Whether the trial court gave an improper jury charge concerning powers of attorney requiring reversal.

## Decision

- The Supreme Court of South Carolina reversed the judgment for the law firm and remanded for a new trial.
- The trial court erred in excluding plaintiffs’ expert testimony; plaintiffs made a sufficient proffer of the substance of the excluded opinions.
- The expert was not disqualified merely because he was not licensed in South Carolina or because he did not practice real estate law.
- Expert testimony explaining the Rules of Professional Conduct and their relationship to the standard of care was admissible for the jury’s consideration.
- The challenged jury instruction on powers of attorney was also improper, contributing to the need for a new trial.

## Legal Principles

- Legal malpractice requires proof of: (1) attorney-client relationship, (2) breach of duty, (3) damages, and (4) proximate causation.
- In legal malpractice actions, the professional standard of care ordinarily must be established through expert testimony.
- A proffer of excluded evidence is adequate if it fairly shows what the rejected testimony would have been.
- An expert in a legal malpractice case is not categorically required to be admitted to practice in the forum jurisdiction or to specialize in the precise subject area at issue; qualification turns on knowledge and experience relevant to the standard of care.
- Rules of Professional Conduct do not themselves create civil liability, but they may be explained by a qualified expert and considered as evidence relevant to professional duties and the standard of care.

## Conclusion

The court ordered a new trial because the exclusion of plaintiffs’ qualified ethics-based expert testimony, together with instructional error on powers of attorney, improperly prevented the jury from receiving evidence and guidance central to determining the standard of care and alleged breach in a conflicted multi-party real estate transaction.


Smith v. Haynsworth, Marion, McKay & Geurard, 322 S.C. 433, 472 S.E.2d 612 (S.C. 1996)