96-580

                                                             No.       96-580

                              IN THE SUPREME COURT OF THE STATE OF MONTANA

                                                                    1997




                                                            CLEVE LONEY,

                                                 Plaintiff and Appellant,

                                                                      v.

                                                         HAROLD VAN DYE,

                                                Defendant and Respondent.




             APPEAL FROM:            District Court of the Fourth Judicial District,
                                    In and for the County of Missoula,
                               The Honorable John Henson, Judge Presiding.



                                                       COUNSEL OF RECORD:

                                                          For Appellant:

                                 Michael R. Tramelli, Great Falls, Montana


                                                         For Respondent:

                          Gregory C. Black, Corette, Pohlman & Kebe, Butte,
                                               Montana




                                    Submitted on Briefs: February 20, 1997

                                                   Decided: March 4, 1997


file:///C|/Documents%20and%20Settings/cu1046/Desktop/opinions/96-580%20Opinion.htm (1 of 4)4/11/2007 1:52:14 PM
96-580

                                                                  Filed:



                                __________________________________________
                                                   Clerk

            Chief Justice J. A. Turnage delivered the Opinion of the Court.

                  Cleve Loney appeals from the July 26, 1996, opinion and order
            of the Fourth Judicial District Court, Missoula County, granting
            Harold Van Dye's motion for summary judgment and denying Loney's
                             motion for summary judgment. We affirm.
                     We restate the following issues raised by Loney on appeal:
                  1.      Did the District Court err when it determined that     27-
                           2-206, MCA, barred Loney's malpractice claim?
                       2.     Did the District Court err when it granted summary
                                   judgment based on res judicata?
                    3.     Did the District Court err when it ruled that the only
         allegation of malpractice raised in the pleadings was Dye's failure
                               to file a declaration of homestead?
                        4.      Did damages result from Dye's failure to file a
                                      declaration of homestead?
                                              BACKGROUND
                   This case arises from Dye's legal representation of Loney in
         bankruptcy proceedings. Additional facts are contained in Loney v.
             Milodragovich, Dale & Dye, P.C. (1995), 273 Mont. 506, 905 P.2d
                                                 158.
                  Loney filed a complaint on May 6, 1993, alleging that Dye was
           negligent and breached his implied contract with Loney by failing
            to file a declaration of homestead in Loney's bankruptcy. In an
               amended answer, Dye asserted numerous affirmative defenses,
           including statute of limitations and res judicata. Dye moved for
             summary judgment, arguing that Loney's claim was barred by res
                judicata. The District Court denied the motion because it
                determined that there was a genuine issue of material fact
          regarding when Loney should have known of the facts giving rise to
                                    his legal malpractice claim.
                   Subsequently Loney's deposition was taken. Dye learned when
                 Loney discovered Dye's failure to file the declaration of
           homestead. Dye filed a second motion for summary judgment, again
         arguing res judicata and also arguing that Loney's claim was barred
           by the statute of limitations for legal malpractice contained at
                    27-2-206, MCA. Loney also moved for summary judgment.
                  The District Court granted Dye's motion for summary judgment
              on the issues of res judicata and statute of limitations, and
             denied Loney's motion for summary judgment. It concluded that
         Loney alleged additional claims of malpractice not properly raised


file:///C|/Documents%20and%20Settings/cu1046/Desktop/opinions/96-580%20Opinion.htm (2 of 4)4/11/2007 1:52:14 PM
96-580

                              in the pleadings. Loney appeals.
                                          DISCUSSION
                  Did the District Court err when it determined that                                              27-2-206,
                           MCA, barred Loney's malpractice claim?

                  We review summary judgment orders de novo. Spain-Morrow
          Ranch, Inc. v. West (1994), 264 Mont. 441, 444, 872 P.2d 330, 331.
           Summary judgment is proper only when no genuine issue of material
            fact exists and the moving party is entitled to a judgment as a
            matter of law. Rule 56(c), M.R.Civ.P. Spain-Morrow Ranch, 872
                                      P.2d at 331-32.
                               Section 27-2-206, MCA, provides:
                  Actions for legal malpractice. An action against an
                    attorney licensed to practice law in Montana or a
                  paralegal assistant or a legal intern employed by an
                   attorney based on the personþs alleged professional
                 negligent act or for error or omission in the personþs
                   practice must be commenced within 3 years after the
                  plaintiff discovers or through the use of reasonable
                   diligence should have discovered the act, error, or
                omission, whichever occurs last, but in no case may the
                action be commenced after 10 years from the date of the
                                 act, error, or omission.

                 It is the knowledge of facts, rather than the discovery of
              legal theories, that is the test for tolling the statute of
           limitations in a legal malpractice action. Burgett v. Flaherty
                     (1983), 204 Mont. 169, 173, 663 P.2d 332, 334.
                  The testimony from Loney's deposition establishes that on
         March 6, 1990, he discovered Dye's failure to file the declaration
          of homestead. The applicable statute of limitations,      27-2-206,
           MCA, began running and expired three years later. Because Loney
         did not file his complaint alleging legal malpractice until May 6,
           1993, more than three years after he discovered Dye's failure to
          file the declaration of homestead, his claim is barred by     27-2-
                                        206, MCA.
               We hold that the District Court did not err when it determined
         that    27-2-206, MCA, barred Loney's malpractice claim. Because we
             so hold, we decline to address the remaining issues raised on
             appeal. The District Court's order granting Dye's motion for
                              summary judgment is affirmed.
                                                  /S/ J. A. TURNAGE

                                                              We concur:

                                                /S/ WILLIAM E. HUNT, SR.
                                                   /S/ JAMES C. NELSON
                                                 /S/ TERRY N. TRIEWEILER


file:///C|/Documents%20and%20Settings/cu1046/Desktop/opinions/96-580%20Opinion.htm (3 of 4)4/11/2007 1:52:14 PM
96-580

                                                 /S/      W. WILLIAM LEAPHART




file:///C|/Documents%20and%20Settings/cu1046/Desktop/opinions/96-580%20Opinion.htm (4 of 4)4/11/2007 1:52:14 PM
