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PADRM Gold Mine, LLC v. Perkumpulan Investor Crisis Center Dressel – WBG

CIVIL PROCEDURE

Clara Nieman

In PADRM Gold Mine, LLC v. Perkumpulan Investor Crisis Center Dressel – WBG, 498 P.3d 1073 (Alaska 2021), the supreme court held that legal malpractice claims are not involuntarily assignable but declined to decide whether such claims are voluntarily assignable. (Id. at 1078). A group of Indonesian citizens (Perkumpulan) filed a federal fraud suit in Washington State against the Dressel corporation. (Id. at 1074). During discovery, Perkumpulan came to believe that some of Dressel’s Alaskan assets such as the PADRM Gold Mine (PADRM) had been purchased with the profits of fraud and brought an in rem action in Alaska state court seeking to quiet title to the properties. (Id. at 1074–75). Ultimately the Washington lawsuit was dismissed, and the Alaska superior court granted summary judgment to PADRM in the quiet title action, along with an award of attorneys’ fees. (Id.). PADRM was unable to collect on its judgment and filed a writ of execution for Perkumpulan’s sole remaining asset: a potential legal malpractice claim against Perkumpulan’s Alaska attorneys, which Perkumpulan had declined to pursue. (Id. at 1075). The superior court denied PADRM’s motion for a writ of execution, and PADRM appealed, arguing that legal claims are personal property under Alaska state law, personal property is subject to assignment, and no statute exempts legal malpractice claims from execution. (Id. at 1076). Noting that the assignment of legal malpractice claims was a matter of first impression, the Alaska supreme court affirmed the lower court and denied PADRM’s writ of execution. (Id. at 1078). The court cited policy considerations such as the negative impacts of involuntary assignment on the attorney-client relationship, and the negative effects of commodifying legal claims in general. (Id. at 1079–80). The court also noted that a majority of states to consider the issue have concluded that legal malpractice claims are unassignable as a matter of public policy. (Id. at 1078). Affirming the lower court’s decision, the supreme court held that legal malpractice claims are not involuntarily assignable but declined to decide whether such claims are voluntarily assignable. (Id.).

PADRM Gold Mine, LLC v. Perkumpulan Investor Crisis Center Dressel – WBG

CIVIL PROCEDURE

Clara Nieman

In PADRM Gold Mine, LLC v. Perkumpulan Investor Crisis Center Dressel – WBG, 498 P.3d 1073 (Alaska 2021), the supreme court held that legal malpractice claims are not involuntarily assignable but declined to decide whether such claims are voluntarily assignable. (Id. at 1078). A group of Indonesian citizens (Perkumpulan) filed a federal fraud suit in Washington State against the Dressel corporation. (Id. at 1074). During discovery, Perkumpulan came to believe that some of Dressel’s Alaskan assets such as the PADRM Gold Mine (PADRM) had been purchased with the profits of fraud and brought an in rem action in Alaska state court seeking to quiet title to the properties. (Id. at 1074–75). Ultimately the Washington lawsuit was dismissed, and the Alaska superior court granted summary judgment to PADRM in the quiet title action, along with an award of attorneys’ fees. (Id.). PADRM was unable to collect on its judgment and filed a writ of execution for Perkumpulan’s sole remaining asset: a potential legal malpractice claim against Perkumpulan’s Alaska attorneys, which Perkumpulan had declined to pursue. (Id. at 1075). The superior court denied PADRM’s motion for a writ of execution, and PADRM appealed, arguing that legal claims are personal property under Alaska state law, personal property is subject to assignment, and no statute exempts legal malpractice claims from execution. (Id. at 1076). Noting that the assignment of legal malpractice claims was a matter of first impression, the Alaska supreme court affirmed the lower court and denied PADRM’s writ of execution. (Id. at 1078). The court cited policy considerations such as the negative impacts of involuntary assignment on the attorney-client relationship, and the negative effects of commodifying legal claims in general. (Id. at 1079–80). The court also noted that a majority of states to consider the issue have concluded that legal malpractice claims are unassignable as a matter of public policy. (Id. at 1078). Affirming the lower court’s decision, the supreme court held that legal malpractice claims are not involuntarily assignable but declined to decide whether such claims are voluntarily assignable. (Id.).