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Professional Responsibility Keyed to Martyn
Paradigm Insurance Co. v. The Langerman Law Offices, P.A.
Citation:24 P.3d 593 (Ariz. 2001)
Paradigm (Petitioner), an Arizona insurance company, issued an insurance policy covering a physician for medical malpractice liability. The physician was sued for malpractice, and Paradigm hired a law firm, Langerman (Defendant), to defend the case. The physician was found liable in the lawsuit. Additionally, Paradigm learned that Langerman had undertaken representation of a claimant who was bringing an action against another Paradigm-insured physician, which violated an agreement between the parties that Langerman would not represent any claimants against Paradigm’s insured parties. When Paradigm refused to pay Langerman, claiming that its legal services had been negligent, Langerman sued Paradigm for fees in Arizona state court, and Paradigm brought a counterclaim for damages. The trial court held that no attorney-client relationship existed between Paradigm and Langerman, since Langerman only represented the physician; therefore Langerman owed no duty of care to Paradigm and could not be held liable for negligence under the circumstances. The state court of appeals reversed.
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