Lawyers' Professional Liability

Key Points:

• While legal malpractice actions can be brought as a negligence or contract claim, the gist of the action doctrine serves to limit those instances. 
• Application of the doctrine can be used to prevent shopping for favorable limitations periods.

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For litigators defending colleagues in legal malpractice actions, the prospect of being faced with causes of action for negligence and breach of contract is not out of the ordinary. Most often, legal malpractice suits involve claims for negligence and breach of contract, and it is well settled that such actions may be brought in either form. Wachovia Bank, N.A. v. Ferretti, 935 A.2d 565, 570 (Pa. Super. 2007). However, simply because they “may” be brought in either form does not ipso-facto mean they should. That is where the gist of the action doctrine comes into play, preventing plaintiffs from recasting torts claims as breach of contract and vice versa. The application of the doctrine can be a helpful tool in malpractice litigation, often used as an offensive tactic, preventing plaintiffs from shopping for favorable limitations periods.

The gist of the action doctrine has evolved significantly since the early 1990s. Surfacing in Bash v. Bell Telephone Company of Pennsylvania, 601 A.2d 825 (Pa. Super. 1992), the court analyzed a plaintiff’s claims that sought damages for emotional distress, mental anguish, embarrassment, and depression for a defendant’s alleged failure to perform a contract duty. The pleading of tort damages as a result of an alleged failure to comply with an advertising contract found Pennsylvania’s Superior Court looking to the federal courts for an analysis of the difference between a tort and a contract. Following the guidance of the federal bench, the Bash court noted that to be construed as a tort, the wrong ascribed must be the gist of the action, the contract being collateral. Bash, 601 A.2d at 829. It was based on this language that the court opined that the obligations at issue were a matter of contract law, not tort, resulting in dismissal of the plaintiff’s negligence claim.

The doctrine later evolved in 2002, with the Superior Court’s decision in eToll, Inc. v. Elias/Savion Advertising, Inc., 811 A.2d 10, 15 (Pa. Super. 2002), where the court first analyzed the doctrine’s application to claims for fraud. Recognizing the various, yet similar, ways courts throughout the Commonwealth applied the doctrine, the eToll court opined that their analysis hinged on whether the alleged fraud concerned the performance of contractual duties. 

Analyzing allegations that the appellant engaged in fraudulent schemes in the course of the parties’ contractual relationship, the eToll court noted that the alleged acts arose in the course of the parties’ contractual relationship and that the duties at issue were grounded in that contract. Thus, the court concluded the claims were “inextricably intertwined,” or that the gist of the action lay in contract. Again, the doctrine evolved. What started as a consideration as to the source of the duty in question turned to whether the actions in question were so tangential, or slightly connected, to the parties’ contractual relationship. 

After eToll, varying approaches were taken with respect to the doctrine’s application. Bash’s approach being used in some matters, while the “inextricably intertwined” approach of eToll being used in others. The Commonwealth Court, too, had its own analysis, using a “misfeasance vs. nonfeasance” approach. Where there was “misfeasance,” being the breach of a duty imposed by the law of social policy, the gist of the action sounded in tort. For “nonfeasance,” or breach of a duty under the terms of the contract, the action sounded in contract.

This mixed-bag approach continued until the Pennsylvania’s Supreme Court decision in Bruno v. Erie Ins. Co., 106 A.3d 48 (Pa. 2014), where the court recognized that, at the core of the doctrine, the critical determinative factor is the duty that is alleged to have been breached. As the Supreme Court opined:

… the substance of the allegations comprising a claim in a plaintiff’s complaint are of paramount importance, and, thus, the mere labeling by the plaintiff of a claim as being in tort, e.g., for negligence, is not controlling. If the facts of a particular claim establish that the duty breached is one created by the parties by the terms of their contract—i.e., a specific promise to do something that a party would not ordinarily have been obligated to do but for the existence of the contract—then the claim is to be viewed as one for breach of contract. If, however, the facts establish that the claim involves the defendant’s violation of a broader social duty owed to all individuals, which is imposed by the law of torts and, hence, exists regardless of the contract, then it must be regarded as a tort.

Bruno, 106 A.3d at 68 (2014).
     
Having evolved from Bash to Bruno, application of the doctrine to a legal malpractice action was more-recently analyzed in Outerlimits Techs., LLC v. O’Connor, 311 A.3d 569 (Pa. Super. 2023), where the plaintiff filed a legal malpractice action based solely in breach of contract. In its opinion, the trial court noted:

[defendant’s] shortcomings constitute a failure to exercise the requisite skill and knowledge that is expected of all attorneys. Therefore, while Appellee failed to adhere to the general standard of care lawyers owe to every client, Appellee did not breach a specific contractual provision or promise. In line with Pennsylvania case law, an action in assumpsit simply was not available to Appellant. As such, any genuine issue of fact as to whether an implied contract existed is immaterial because, regardless, Appellee failed to adhere to a generalized standard of care.

Outerlimits, 311 A.3d 569 (Pa. Super. Ct. 2023). The appellate court agreed, relying on Bruno and noting the contract in question was merely a vehicle creating the relationship between the parties, during which counsel allegedly committed malpractice, as opposed to the breach of a duty specifically created by the contract.

This decision further supports the position that, while legal malpractice actions can sound in both tort and contract, it is not always the case. While attorneys do owe a general standard of care to their clients, this does not make every malpractice action sound in contract simply based on the relationship between the parties. Bruno continues to dictate that the key to the analysis in all matters is the source of the duty allegedly breached. In a profession such as the law, where relationships are defined by both written and oral contracts, such a differentiation is key. In situations where both claims are brought, or even actions where one such claim is brought improperly, preliminary objections or dispositive motions raising the doctrine can help limit a client’s exposure.

After years of evolution and application, we would all like to think that we are finally getting the gist. But, uncertainty lurks in the form of the pending Superior Court decision in Poteat v. Asteak, a legal malpractice action involving a breach of a contract allegedly implicitly imposing a duty to provide services consistent with the profession at large. On appeal in Poteat, the Superior Court disagreed with the lower court’s use of the gist of action doctrine to re-characterize the claim as one sounding in tort. Id., 2024 WL 1202926 (Pa. Super. Mar. 21, 2024). Undoubtedly signaling the far-reaching implications of its decision, the Superior Court’s opinion was subsequently withdrawn and the matter submitted for reargument en banc. See Poteat, 2024 WL 2813104 (Pa. Super. June 3, 2024). 

And now, we wait. The Poteat decision will be yet another event in the continuing evolution of the gist of the action doctrine. Without question, it will have a significant impact on the doctrine’s application in legal malpractice actions, potentially requiring further instruction from the Supreme Court to ensure we all are truly getting the gist.

*Jim is a member of our Professional Liability Department and works in our Scranton, PA office. 

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_{Defense Digest, Vol. 31, No. 2, June 2025, is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2025 Marshall Dennehey. All Rights Reserved. This article may not be reprinted without the express written permission of our firm. For reprints, contact tamontemuro@mdwcg.com.}