Paradigm Ins. Co. v. Langerman Law Offices

Paradigm Insurance Company (Plaintiff) issued an insurance policy covering a physician for medical malpractice liability. The physician was sued for malpractice, and Paradigm (Plaintiff) hired an attorney, Langerman (Defendant), to defend the case. Certain investigations regarding the case, and vital to a competent defense, Defendant failed to perform. In addition, Plaintiff then learned that Defendant had undertaken representation of a claimant who was bringing an action against another Paradigm-insured physician. The latter representation violated an agreement between Plaintiff and Defendant that the latter would not represent any claimants against Plaintiff’s insureds. Plaintiff brought suit against Defendant for malpractice. On summary judgment, the trial judge held that because there was no express agreement that Langerman (Defendant) could represent both Paradigm (Plaintiff) and the physician insured by Plaintiff, no attorney-client relationship existed between Defendant and Plaintiff, therefore Defendant owed no duty of care to Plaintiff and could not be held liable for negligence that injured only Plaintiff but not Defendant’s sole client, the insured physician. The court of appeals reversed, holding that there was a dual attorney-client relationship in this case. Defendant appealed