District Court, Salt Lake Department The Honorable Mark S.
Kouris No. 170906637
J. Porter, Scott Evans, Erika Larsen, and Kristen C. Kiburtz,
Attorneys for Appellants
M. Morse, R. Scott Young, and Adam M. Pace, Attorneys for
Michele M. Christiansen Forster authored this Opinion, in
which Judges David N. Mortensen and Jill M. Pohlman
CHRISTIANSEN FORSTER, JUDGE
First Interstate Financial LLC and Paul Thurston
(collectively, Plaintiffs) appeal the district court's
dismissal of their complaint against Scott Savage and Savage
Yeates and Waldron PC (collectively, Savage), as well as its
denial of their motion to amend their complaint. We reverse
and remand for further proceedings.
In April 2009, Plaintiffs retained Savage to defend them in a
lawsuit filed against them in Utah by McGillis Investments
Company. During the discovery period on this lawsuit,
Plaintiffs collected and produced approximately 19, 000
documents, which Savage intended to present as exhibits at
trial. However, Savage failed to comply with the pretrial
disclosure requirements of rule 26(a) of the Utah Rules of
Civil Procedure, and as a result, the trial court struck
"substantially all" the exhibits Savage intended to
use to defend Plaintiffs at trial.
The case proceeded to trial, and the jury entered a verdict
against Plaintiffs on October 22, 2010, which included a $1,
250, 000 judgment. Plaintiffs paid the judgment, as well as
$700, 000 in legal fees to Savage. Subsequently, McGillis
filed a second suit against Plaintiffs in Colorado, which
went to trial in June 2014. At trial in that case,
"McGillis was allowed to make references to the Utah
case." The Colorado jury ultimately found against
Plaintiffs as well and entered judgment "in the amount
of $1, 450, 000 and property worth $400, 000."
Plaintiffs filed a complaint against Savage on October 17,
2017, alleging legal malpractice, breach of contract, and
breach of fiduciary duty. The complaint alleged that Savage
did not tell Plaintiffs the exhibits had been stricken until
just before trial, that he told them "not to worry"
about the stricken exhibits because he could rely on the
other party's exhibits at trial, and that he assured them
the trial court had erred in striking the exhibits and its
decision would be overturned on appeal. It further alleged
that Savage did not inform Plaintiffs that the exhibits were
stricken due to his failure to comply with the pretrial
disclosure requirements of rule 26(a) and that Plaintiffs did
not learn of his failure until June 2014.
Savage moved to dismiss Plaintiffs' complaint on the
ground that the statute of limitations on their malpractice
claims had expired. Savage asserted that the statute of
limitations on Plaintiffs' claims began to run on October
22, 2010, when the verdict was entered against them in Utah,
and that pursuant to the four-year limitations period on
legal malpractice claims, see Utah Code Ann. §
78B-2-307 (LexisNexis 2018), their claims expired on October
22, 2014. Savage further asserted that the statute of
limitations was not tolled, because Plaintiffs admitted that
they discovered the facts giving rise to their claims in June
2014, within the limitations period.
In response to Savage's motion, Plaintiffs sought to
amend their complaint to include additional allegations
relevant to the tolling issue:
36. At the time Plaintiffs first heard of Savage's
failure, Savage was still representing Plaintiffs.
37. When Plaintiffs first learned of Savage's failure,
they did not know that such failure amounted to ...