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Sunday, August 25, 2019

Appeals court reverses judgment in lawyer's negligence case

State Court

By Charmaine Little | Aug 7, 2019

HOUSTON -- The Texas Court of Appeals First District sided July 23 with a man suing his lawyer, alleging fraud and professional negligence, and reversed a summary judgment ruling that dismissed the claims.

Dr. Pankaj Shah and his company Krishna Financial Ltd. sued his lawyer Keith Remels along with Dow, Golub, Remels & Gilbreath PLLC in Harris County District Court. He alleged Remels committed fraud, acted with professional negligence and other related forms of misconduct. 

Most important, Shah alleged Remels convinced him to withdraw his purchase of ownership units for a hospital partnership “under an unreasonably abbreviated deadline and on terms that artificially undervalued the units,” the appeals court ruled. Remels had filed a motion for summary judgment and said the lawsuit was outside of the limitations as an e-mail chain that dates to 2011 and allegedly proves that the limitations on Shah’s lawsuit started June 17, 2011. 

However, Shah argued that the e-mail chain does not even reference the rescission offer’s valuation concerning the units “or any of the circumstances that Shah alleges later showed the units to be significantly more valuable than the rescission offer represented,” according to the appeals court.

The appeals court sided with Shah and determined the e-mail chain in question does not prove Shah was aware of or should have later discovered that the injury he suffered was because of Remel’s alleged misconduct.

It pointed out that Remels had the burden of providing enough evidence to make the discovery rule irrelevant. Unfortunately for Remels, the only proof he offered was the e-mail exchange, in hopes of showing that at that time, Shah knew of the alleged negligence. But the court said the e-mail chain alone was not enough.

“Nothing in the e-mail chain, when read in the most favorable to Shah, can reasonably be read as indicating that he knew that he was about to give up assets worth significantly more than what he was going to receive for them under the rescission offer,” the appeals court ruled.

The panel added that it is not sensible to determine that Shah should have his own personal attorney to evaluate the partnership in about a day.

As for the chain, Shah initiated it on June 16, 2011, to respond to the rescission offer Remels sent him six days before. He asked Remels to “clarify” that the offer’s deadline was June 17 or July 11. Remels then called Shah on June 17 and told Shah to seek further counsel about the offer and any consequence he would suffer for delaying its acceptance. Shah said he thought Remels was his attorney, and said he needed a clearer answer. Remels insisted that he was not Shah’s lawyer. 

Shah then referenced the 30-day deadline again and said he planned to use that full time to evaluate the offer. He then said he would accept the rescission “as a result of your non-responsiveness and threats,” said the court.

Justice Richard Hightower ruled on the case. Chief Justice Sherry Radack and Justice Laura Carter Higley concurred.

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