In Stanfield v. Neubaum, No. 15-0387, 2016 Tex. LEXIS 578 (June 24, 2016), a legal malpractice case, the Texas Supreme Court held that under certain circumstances judicial error may be a superseding cause of the client's damages that relieves the attorney of any liability.
The instant appeal originated from prior litigation in which the malpractice defendants defended the malpractice plaintiffs, the Neubaums, in a suit alleging usurious lending practices. The attorneys raised bona fide error and usury cure as defenses, but at trial did not introduce evidence to support those defenses.
The trial court entered a usury judgment against the Neubaums on an agency theory to which the attorneys had timely objected. An appeal followed, and the appellate court reversed the usury judgment on the agency theory.
The Neubaums did not contend the attorneys failed to properly present or argue the agency defense or otherwise contributed to the trial court's failure to make a proper ruling on that issue. Rather, the Neubaums argued the trial court's error would have been immaterial and a favorable judgment would have been rendered if the attorneys had pursued the bona fide error and usury cure defenses.
Without conceding negligence, the attorneys argued that proximate cause was lacking because, as a matter of law, judicial error constitutes a new and independent, or superseding, cause that severs any causal connection between the attorney's alleged negligence and the costs the client incurred to appeal.
The trial court agreed with the attorneys in the malpractice suit and granted summary judgment in the attorneys' favor. A divided court of appeals reversed and remanded in part. 465 S.W.3d 266, 268 (Tex. App. – Houston [14th Dist.] 2015). Reasoning that expert testimony was necessary to prove the attorney's negligence did not proximately cause the plaintiffs harm, the court of appeals concluded the attorney's failure to produce expert testimony was fatal to their summary judgment motion. The court of appeals declined to consider whether judicial error can constitute a superseding cause that breaks the causal chain and, as a matter of law, negates proximate cause.
The Supreme Court held that the attorneys were entitled to summary judgment because there was no evidence that the attorneys contributed to the judicial error or that the judicial error was a reasonably foreseeable result of the attorneys' alleged negligence. As a matter of law, the trial court's error of law on the agency issue was a new and independent cause of the adverse usury judgment and the ensuing appellate litigation costs. Because the trial court's legal error constituted a superseding cause as a matter of law, no expert testimony was necessary for the attorneys to negate causation.
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