When a lawyer sues a client for unpaid fees, the client must assert any possible claim for legal malpractice as a compulsory counterclaim, the Ohio Eighth District Court of Appeals has held.   In other words:  use it or lose it.  The court upheld summary judgment in favor of a lawyer whose client failed to assert such a counterclaim.

In Harper v. Anthony, the lawyer had represented the client in a divorce case.  After the client sued for legal malpractice, the lawyer counterclaimed for unpaid legal fees.  When the client failed to answer the counterclaim, the lawyer moved for a default judgment.  The client voluntarily dismissed the malpractice claim, leaving the unanswered counterclaim for fees standing.  The trial court entered an $11,000 default judgment against the client.

When the client refiled the legal malpractice case, the lawyer moved for summary judgment, arguing that the claim was a compulsory counterclaim to the lawyer’s claim based on unpaid fees, and the client lost it by failing to prosecute it in the first action.  The trial court agreed, and the court of appeals affirmed.  (The Ohio Supreme Court declined review.)

Under Ohio Civil Rule 13(A), a counterclaim is compulsory if it is logically related to the opposing party’s claim.   This met the test, the court held, since the malpractice claim arose out of the same operative facts as the claim for fees.  

The client in Harper argued that it was inequitable to require a client to assert a legal malpractice claim at the same time as a lawyer files a suit for unclaimed fees, because the client might not know that a malpractice claim exists until after the unpaid fee dispute is resolved.

But the court of appeals rejected that argument:  under Ohio Civil Rule 13(A), a counterclaim is compulsory only if it exists at the time that the pleading is served.  The client here had discovered his alleged malpractice claim and sued on it before his former lawyer filed the unpaid-fee counterclaim.  Therefore, the client was barred from refiling the same legal malpractice claim.

When you sue a client for unpaid fees, you can often expect a counterclaim for malpractice; here, the shoe was on the other foot.  But it is worth remembering that failing to assert a compulsory counterclaim can doom any claim — whether it’s for your fees, or whether it’s a malpractice claim against you.