Certiorari to the Utah Court of Appeals
District, St. George The Honorable G. Michael Westfall No.
Russell S. Walker, Salt Lake City, for petitioners
Michael F. Skolnick, Salt Lake City, for respondent
Justice Durrant authored the opinion of the Court, in which
Associate Chief Justice Lee, Justice Himonas, Justice Pearce,
and Justice Petersen joined.
DURRANT CHIEF JUSTICE
Kelly and Monty Moshier lost their opportunity to collect
$874, 805.68 owed to them in a bankruptcy proceeding when
their attorney, Darwin C. Fisher, failed to file their
nondischargeability claim before the statute of limitations
expired. Several years later, the Moshiers sued Mr. Fisher
for malpractice. The district court dismissed their
malpractice claim as untimely. Because we find that the
malpractice claim did not accrue until the bankruptcy court
confirmed the final distribution plan, the Moshiers'
claim was timely. Accordingly, we reverse.
Kelly and Monty Moshier hired Darwin Fisher to represent them
in a lawsuit against Allen and Laura Cottam, involving claims
of fraud, misrepresentation, and breach of warranty. The
Moshiers obtained a judgment against the Cottams in the
amount of $785, 710.88. The judgment included findings of
fraud, misrepresentation, and punitive damages.
In September 2010, the Cottams filed for bankruptcy. The
Moshiers again hired Mr. Fisher to represent them in the
bankruptcy proceedings. He timely filed the Moshiers'
proof of claim. Because the Moshiers' claim was
based on a judgment for money obtained by fraud, their claim
was exempt from discharge under section 523 of the Bankruptcy
Code. Creditors claiming this exemption from
discharge must commence an independent action by filing a
complaint alleging nondischargeability. But Mr. Fisher
failed to file the Moshiers' claim for
nondischargeability by the deadline, December 29,
2010. Instead, he filed the claim almost a
year after the deadline, which the bankruptcy court dismissed
as untimely. On January 31, 2012, the bankruptcy court
confirmed the Cottams' bankruptcy plan for
In March 2012, Mr. Fisher informed the Moshiers that he
missed the deadline for filing their nondischargeability
claim and that their claim had been dismissed. He told them
he had filed a claim with his malpractice insurance company
and suggested that they retain new counsel for the bankruptcy
proceedings. The Moshiers assert they did not believe they
needed to initiate any legal action against Mr. Fisher,
because they believed his claim with his malpractice insurer
was the equivalent of them initiating a legal proceeding.
They also argue that they believed their claim was fully
secured and that they would still receive the full value of
their claim. By 2013, the bankruptcy trustee
informed the Moshiers they would not receive payment of their
full claim. To date, the Moshiers have received $58, 151.72
of their secured claim and $139, 508.64 of their unsecured
claim, for a total of $197, 660.36.
In June 2014, Mr. Fisher's malpractice counsel, Michael
Skolnick, sent the Moshiers a letter stating that the
malpractice insurance company saw many "hurdles"
that severely reduced the value of their claim. At that time
or shortly thereafter, the Moshiers hired an attorney,
Russell Walker, to represent them. He sent a letter to Mr.
Skolnick on June 17, 2014, outlining the damage done by Mr.
Fisher's failure to timely file the Moshiers'
nondischargeability claim. The Moshiers filed their
malpractice action against Mr. Fisher on October 6, 2015. The
district court dismissed their claim as untimely, finding
that the statute of limitations had expired on December 29,
2014-four years after Mr. Fisher missed the filing deadline
for the nondischargeability claim. The Moshiers appealed, and
the court of appeals affirmed. The Moshiers then petitioned
this court for certiorari, which we granted. We have
jurisdiction pursuant to Utah Code section 78A-3-102(3)(a).
We must determine when a legal malpractice claim accrues and
the statute of limitations begins to run where an attorney
misses the deadline for filing a nondischargeability claim in
a bankruptcy proceeding. On certiorari, we review "the
court of appeals' decision for correctness, without
according any deference to its analysis."The
application of a statute of limitations and grant of a motion
to dismiss are both questions of law, which we review for
correctness.But application of a statute of
limitations may also ...