Shipman v. Kruck

PRESENT: All the Justices.

DONALD L. SHIPMAN, INDIVIDUALLY AND
AS TRUSTEE, ET AL.
                                              OPINION BY
v.   Record No. 030500                 JUSTICE G. STEVEN AGEE
                                            MARCH 5, 2004
FREDERICK R. KRUCK, JR., ESQ.


         FROM THE CIRCUIT COURT OF THE CITY OF ALEXANDRIA
                       John E. Kloch, Judge

      The determinative issue in this appeal is when the

appellants’ cause of action for legal malpractice accrued for

purposes of the statute of limitations.

               I.   BACKGROUND AND PROCEEDINGS BELOW

      On January 16, 1998, Donald L. Shipman and his wife, Kym L.

Shipman (collectively, “the Shipmans”) hired Frederick H. Kruck,

Jr. (“Kruck”) to defend them in an action brought by one of the

Shipmans’ creditors.     The Shipmans informed Kruck that shielding

their residence from the collection efforts of creditors was

their primary objective.    The Shipmans also informed Kruck that

the residence was held in trust under a 1984 Declaration of

Trust (“the Trust”).     The Shipmans gave Kruck an unsigned and

undated copy of the Declaration of Trust, reflecting Mr. Shipman

was the Trust’s trustee holding the trust property for the

benefit of Mrs. Shipman and their children.    The Shipmans had
conveyed their residence by deed to Mr. Shipman as Trustee under

the Trust.1

     On March 9, 1998, Kruck filed a joint Chapter 7 petition on

behalf of the Shipmans in the United States Bankruptcy Court for

the Eastern District of Virginia.     The Shipmans agreed to the

bankruptcy filing based on Kruck’s advice.

     Kruck represented the Shipmans in the initial stages of the

bankruptcy proceedings, but certain of the Shipmans’ creditors

and the Bankruptcy Trustee asserted the Trust was revocable and

therefore the Trust’s assets were nonexempt property of the

Shipmans’ bankruptcy estate subject to sale and administration

by the Bankruptcy Trustee.   On January 19, 1999, Kruck withdrew

as the Shipmans’ counsel and advised them that he would be more

valuable as a witness in the bankruptcy proceedings concerning

the Trust.    The Shipmans promptly hired new counsel to represent

them in the bankruptcy proceedings.2

     During the subsequent bankruptcy proceedings Kruck

testified that he erroneously assessed the trust documents as

establishing an irrevocable trust when he advised the Shipmans


     1
       By an examination of land title records, Kruck verified
the real estate conveyances to the trust, but found no copy of
the trust document on record.
     2
       The parties disagree as to whether new counsel was hired
explicitly to cure Kruck’s negligence. Our resolution of this
case does not depend on why, or even if, the Shipmans hired new
counsel.

                                  2
to file bankruptcy.    On March 8, 2000, the bankruptcy court

entered an order declaring the Trust to be a revocable trust and

authorizing the Bankruptcy Trustee to sell the Shipmans’

residence as an asset of the bankruptcy estate for the payment

of the Shipmans’ creditors.    To prevent their residence from

being sold to a third party, the Shipmans purchased the

residence for $427,000 from the Bankruptcy Trustee on June 29,

2001.

        On January 8, 2002, the Shipmans filed a motion for

judgment against Kruck in the Circuit Court of the City of

Alexandria alleging counts for negligence, breach of contract,

and negligent infliction of emotional distress.    They asserted

that Kruck was negligent in failing to advise them that the

Trust was revocable and could be revoked by the Bankruptcy

Trustee if they filed for bankruptcy.    Kruck filed a demurrer

and plea in bar alleging the Shipmans lacked standing to bring

their suit because any claims they might have belonged to the

bankruptcy estate and must be asserted by the Bankruptcy

Trustee.    Before argument on Kruck’s demurrer and plea in bar

the Shipmans requested a nonsuit which the trial court granted

on March 12, 2002.

        The Shipmans then requested and received an order from the

bankruptcy court abandoning any interest in an action for

malpractice against Kruck as part of the bankruptcy estate.


                                   3
Armed with the abandonment order, the Shipmans filed a new

motion for judgment against Kruck on September 11, 2002, in

which they renewed the counts for negligence and breach of

contract.   Kruck filed another demurrer and plea in bar alleging

that the Shipmans’ action was barred by the three-year statute

of limitations applicable to breach of an oral contract.   He

asserted that the limitations period expired on January 19,

2002, three years after Kruck’s representation of the Shipmans

terminated.

     The trial court determined that because the action was

based upon an oral contract, the applicable statute of

limitations period was three years.   The trial court further

held that the Shipmans’ cause of action accrued when Kruck’s

representation of the Shipmans terminated on January 19, 1999,

and that filing the nonsuit did not toll the running of the

statute of limitations.   Therefore, the trial court sustained

Kruck’s plea in bar.3

     The Shipmans filed a motion for reconsideration alleging a

written contract existed (and thus the correct limitations

period was five years) and that their legal malpractice claim

did not accrue until there was payment on a judgment creating

damages.    The trial court denied the motion, ruling the Shipmans

     3
       The trial court did not rule on Kruck’s demurrer and the
Shipmans did not assign error to the trial court’s ruling on the
effect of the nonsuit.

                                  4
failed to prove the existence of a written contract and that, in

any event, it was not pled.    With regard to the accrual issue,

the trial court held that the Shipmans’ cause of action accrued

“when counsel was retained and paid,” referring to the counsel

substituted for Kruck.

     On appeal, the Shipmans assert two assignments of error.

First, they contend the trial court erred in granting Kruck’s

plea in bar and denying their motion for reconsideration because

their action was filed within the applicable three year

limitations period.4   Second, they assert the trial court erred

in holding that their cause of action accrued when Kruck’s

representation of them ended and new counsel was retained and

paid because there was no evidence in the record as to when new

counsel was paid.

                       II.   STANDARD OF REVIEW

     “A cause of action for legal malpractice requires the

existence of an attorney-client relationship which gave rise to

a duty, breach of that duty by the defendant attorney, and that

the damages claimed by the plaintiff client must have been

proximately caused by the defendant attorney’s breach.”       Rutter

v. Jones, Blechman, Wolz and Kelly, 264 Va. 310, 313, 568 S.E.2d

     4
       No assignment of error was      made to the trial court’s
ruling that the five year statute      of limitations applicable to
written contracts did not apply.       The parties now agree the
applicable statute of limitations      is three years, the period
applicable to oral contracts.

                                   5
693, 695 (2002).   The statute of limitations for legal

malpractice actions is the same as those for breach of contract

because although legal malpractice actions sound in tort, it is

the contract that gives rise to the duty.    MacLellan v.

Throckmorton, 235 Va. 341, 343, 367 S.E.2d 720, 721 (1988);

Oleyar v. Kerr, 217 Va. 88, 90, 225 S.E.2d 398, 400 (1976)); see

also Code § 8.01-246 (setting forth the limitations periods for

breach of contract actions).

                           III.   ANALYSIS

     The parties agree the alleged negligent act, the breach of

Kruck’s duty to the Shipmans, occurred when the bankruptcy

petition was filed on March 9, 1998.    The parties differ,

however, in affixing the date when the statute of limitations on

the Shipmans’ legal malpractice action accrued.

     Code § 8.01-230 states, in pertinent part, that “[i]n every

action for which a limitation period is prescribed, the right of

action shall be deemed to accrue and the prescribed limitation

period shall begin to run . . . when the breach of contract

occurs in actions ex contractu and not when the resulting damage

is discovered.”    We have previously stated that “[a] right of

action is a remedial right to presently enforce a cause of

action.”   Stone v. Ethan Allen, Inc., 232 Va. 365, 368, 350

S.E.2d 629, 631 (1986).   Although a cause of action and a right




                                  6
of action may accrue simultaneously, a right of action cannot

arise until a cause of action exists.   Id.

     The Shipmans contend that until the bankruptcy court

finally adjudicated the Trust to be revocable and therefore a

nonexempt part of the Shipmans’ bankruptcy estate, they had no

cause of action (and thus no right of action) against Kruck.

This is so, the Shipmans contend, because until that point in

time they had no injury or damages − an essential element of a

legal malpractice cause of action.   Alternatively, citing Allied

Productions v. Duesterdick, 217 Va. 763, 232 S.E.2d 774 (1977),

the Shipmans argue there could be no damages until there was

payment on an underlying judgment under the so-called “payment

rule.”   The Shipmans contend the “payment” did not occur, and

the limitations period did not begin to run, until June 29,

2001, when they purchased their residence from the Bankruptcy

Trustee to prevent its sale.

     Kruck asserts the statute of limitations began to run when

the bankruptcy petition was filed, subject to the “continuous

representation rule” set forth in Keller v. Denny, 232 Va. 512,

352 S.E.2d 327 (1987).

                   A.    DETERMINATION OF INJURY

     The parties agree that Kruck breached his duty to the

Shipmans on March 9, 1998, when the bankruptcy petition was

filed.   The issue in controversy is whether on that date, or at


                                 7
a later time, the Shipmans sustained injury or damage sufficient

to constitute a cause of action.

       We have stated on more than one occasion that “[d]amage is

an essential element of a cause of action.     Without some injury

or damage, however slight, a cause of action cannot accrue.”

Keller, 232 Va. at 520, 352 S.E.2d at 332; see Stone, 232 Va. at

365, 368-69, 350 S.E.2d at 631-32; accord First Va. Bank-

Colonial v. Baker, 225 Va. 72, 82, 301 S.E.2d 8, 13-14 (1983);

Locke v. Johns-Manville Corp., 221 Va. 951, 957, 275 S.E.2d 900,

904 (1981); Caudill v. Wise Rambler, 210 Va. 11, 13, 168 S.E.2d

257, 259 (1969).      “In the absence of any injury or damage, there

is no cause of action.”     Rutter, 254 Va. at 313, 568 S.E.2d at

695.   Moreover, we have said that it is immaterial whether all

the damages resulting from the negligent act were sustained at

the time that act occurred.     The running of the limitations

period will not be tolled by the fact that the actual or

substantial damages did not occur until a later date.      Stone,

232 Va. at 369, 350 S.E.2d at 632; Housing Authority v. Laburnum

Corp., 195 Va. 827, 839, 80 S.E.2d 574, 581 (1954)).

       In Virginia,

       [w]e have followed the general rule that the
       applicable period of limitation begins to run
       from the moment the cause of action arises rather
       than from the time of discovery of injury or
       damage, and we have said that difficulty in
       ascertaining the existence of a cause of action
       is irrelevant.


                                    8
Virginia Military Institute v. King, 217 Va. 751, 759, 232

S.E.2d 895, 900 (1977) (hereinafter “VMI”) (citing Laburnum, 195

Va. at 838, 80 S.E.2d at 580-81).     In VMI we commented that this

rule may produce inequities by triggering a statute of

limitations “when the injury or damage is unknown or difficult

or even incapable of discovery . . . .”    Id. at 760, 232 S.E.2d

at 900.   Nevertheless, we concluded that it was the role of the

General Assembly, not the judiciary, to change a rule of law

that has been relied upon by bench and bar for so long.    Id.    We

continue to adhere to that principle.     Under Code § 8.01-230 the

injury is deemed to accrue “when the breach of contract occurs

. . . not when the resulting damage is discovered.”

       Upon the filing of the bankruptcy petition the Shipmans

incurred a legal injury.   Although the injury could not be

delineated as a sum certain or reflected as a final judgment on

the merits, there was injury sufficient to commence a cause of

action for legal malpractice.   First and foremost, the Shipmans

lost control of their assets to the Bankruptcy Trustee,

including the power to revoke the Trust and receive the

reversion.   The filing of the bankruptcy, in and of itself,

vested those rights in the Bankruptcy Trustee as a matter of

law.   11 U.S.C. §§ 541, 542, 544, 704 (2000).   This injury in

particular countermanded their express wishes to protect the



                                  9
Trust property from their creditors.    Even the Shipmans’ right

to bring a legal malpractice claim vested in the Bankruptcy

Trustee, which necessitated their initial nonsuit.    See National

Am. Ins. Co. v. Ruppert Landscaping Co., 187 F.3d 439, 441 (4th

Cir. 1999) (“If a cause of action is part of the estate of the

bankrupt then the trustee alone has standing to bring that

claim.”); Ellwanger v. Budsberg, 140 Bankr. 891, 903 (Bankr.

W.D. Wash. 1992) (state court actions for legal malpractice are

property of the bankruptcy estate); Scarlett v. Barnes, 121

Bankr. 578, 579 (W.D. Mo. 1990) (state court actions for legal

malpractice are property of the bankruptcy estate).    Further,

the Shipmans admitted in their motion for judgment that in

addition to the costs of repurchasing their residence, they

incurred “additional costs in legal fees, litigation costs, and

other costs associated with the bankruptcy filing and

litigation.”   (Emphasis added).    The Shipmans’ own pleadings

thus admit that the filing fee for the bankruptcy itself is a

recoverable damage.5   As we note below, these damages need only

be incurred, not paid.

     The unity of duty, breach, and damage required to establish

a cause of action occurred on March 9, 1998, when the bankruptcy

petition was filed.    It was at that time the Shipmans’ cause of


     5
       The Shipmans also allege their credit rating was damaged
by the bankruptcy filing.

                                   10
action against Kruck attached, albeit vested in the Bankruptcy

Trustee.    Having determined that the Shipmans’ cause of action

existed as of the time the bankruptcy was filed, the question

then becomes, under Code § 8.01-230, whether the Shipmans’ right

of action came into existence simultaneously with their cause of

action or whether it accrued at another time.

               B.   THE CONTINUOUS REPRESENTATION RULE

     Code § 8.01-230 dictates the right of action shall accrue

at the time of the breach.    Thus, in this case, the Shipmans’

right of action came into existence and their cause of action

accrued contemporaneously with the filing of the bankruptcy

petition.    In other words, the Shipmans could have brought an

action against Kruck at any time after the bankruptcy petition

was filed.   However, that does not necessarily establish the

date the statute of limitations began to run for purposes of a

legal malpractice action.    In Keller we held that

     when malpractice is claimed to have occurred
     during the representation of a client by an
     attorney with respect to a particular undertaking
     or transaction, the breach of contract or duty
     occurs and the statute of limitations begins to
     run when the attorney’s services rendered in
     connection with that particular undertaking or
     transaction have terminated.

Keller, 232 Va. at 518, 352 S.E.2d 330.    This axiom is commonly

termed the “continuous representation rule,” which takes into

consideration the special trust and confidence inherent in the



                                 11
attorney-client relationship.    Id. at 518, 352 S.E.2d at 331.

“The relationship between a lawyer and his client is a fiduciary

relationship, one which commands the highest fidelity to a most

solemn trust, for the lawyer is the expert and the client is

utterly dependent upon his knowledge, his skill, and his honor.”

Duesterdick, 217 Va. at 767, 232 S.E.2d at 776-77 (Poff, J.,

dissenting); see also MNC Credit Corp. v. Sickels, 255 Va. 314,

318, 497 S.E.2d 331, 333 (1998) (noting “the highly confidential

and fiduciary relationship between an attorney and client”).6

     In Keller we made clear that the continuous representation

rule applies “only when a continuous or recurring course of

professional services relating to a particular undertaking is

shown to have taken place over a period of time.”   Keller, 232

Va. at 518, 352 S.E.2d at 331.    The proper inquiry is not

whether a general attorney-client relationship has ended, but

instead, when the attorney’s work on the particular undertaking

at issue has ceased.   Id.   If malpractice is alleged with

respect to “a single, isolated act, Code § 8.01-230 . . .


     6
       Code § 8.01-230 was amended in 1996. However, the changes
do not materially affect the issue under consideration here and
the statute as amended does not explicitly abrogate the
continuous representation rule this Court expressed in Keller.
See Weathers v. Commonwealth, 262 Va. 803, 805, 553 S.E.2d 729,
730 (2001) ("When the General Assembly acts in an area in which
one of its appellate courts already has spoken, it is presumed
to know the law as the court has stated it and to acquiesce
therein, and if the legislature intends to countermand such
appellate decision it must do so explicitly.")

                                 12
dictates that the statute of limitations begins to run when that

act is performed, regardless of the time of its discovery.”    Id.

at 518-19, 352 S.E.2d at 331.

     Applying the criteria of the continuous representation rule

to the case at bar the record reflects that the attorney-client

relationship between Kruck and the Shipmans was for the

particular undertaking concerning the creditor’s action and the

resulting bankruptcy.   Kruck’s advice to the Shipmans to file

for bankruptcy was an important and integral part of his

representation in that matter.   For statute of limitations

purposes, the continuous representation rule effectively tolled

the accrual of the statute of limitations for the Shipmans’

cause of action from the filing of bankruptcy until January 19,

1999, the date Kruck’s representation terminated regarding the

particular undertaking for which he was engaged.

     For purposes of the continuous representation rule, it is

irrelevant whether substitute counsel is acquired or when that

occurs.   The date the alleged negligent attorney’s

representation of the client terminates is the relevant date

which commences the running of the statute of limitations.

Unless another rule of law tolls the accrual date further, the

Shipmans thus had until January 19, 2002, to timely file their

legal malpractice claim against Kruck.




                                 13
                      C.   THE “PAYMENT RULE”

     In Duesterdick this Court held that a motion for judgment

asserting legal malpractice that fails to allege actual damages

fails to state a cause of action, and is demurrable.

     [W]hen a client has suffered a judgment for money
     damages as the proximate result of his lawyer's
     negligence such judgment constitutes actual
     damages recoverable in a suit for legal
     malpractice only to the extent such judgment has
     been paid. Here, the motion for judgment failed
     to allege such actual damages. It failed,
     therefore, to state a cause of action, and the
     trial court correctly sustained the demurrer.

217 Va. at 766, 232 S.E.2d at 776.   The Shipmans aver that our

decisions in Duesterdick and Rutter stand for the “payment

rule,” which they construe to mean “that a cause of action for

legal malpractice does not accrue until there is actual injury

or damages, and there is, at a minimum, a judgment in any

underlying litigation on an issue central to the malpractice

claim.”   They argue that the outcome in Rutter was based on this

view of the Duesterdick “payment rule.”

     According to the Shipmans, application of the “payment

rule” means the statute of limitations did not begin to run

until they had suffered a judgment (the bankruptcy court’s March

8, 2000 order declaring the Trust revocable) and they had made

payment on that judgment by purchasing the residence from the

Bankruptcy Trustee on June 29, 2001.   The Shipmans thus contend

they had three years from that date, until June 29, 2004, to


                                14
bring their malpractice action.    Since Kruck’s alleged breach of

duty occurred on March 8, 1998 with the filing of the bankruptcy

petition, the Shipmans’ “payment rule” would allow them to file

their malpractice claim more than six years after the breach.

     Kruck responds that Duesterdick is “not a statute of

limitations or accrual case but instead simply stands for the

proposition that attorneys are only liable for actual damages

which their errors proximately cause their clients to incur.”

Moreover, Kruck asserts the “payment rule” only applies “when a

client has suffered a judgment for money damages as the

proximate result of his lawyer’s negligence.”    Duesterdick, 217

Va. at 766, 232 S.E.2d at 776.

     Neither Duesterdick nor Rutter involved a statute of

limitations issue.   In Duesterdick, the trial court sustained a

demurrer to a motion for judgment which failed to sufficiently

plead damages.   The motion for judgment did not allege the

plaintiff had made any payment upon a default judgment which was

the basis of the alleged legal malpractice.     In affirming the

trial court, we never considered the statute of limitations in

any way.

     Rutter involved a legal malpractice claim brought by the

executor of an estate against a law firm that had drafted the

decedent’s will and trust documents.   The estate alleged that

the testamentary documents failed to distribute charitable


                                  15
donations according to the decedent’s wishes, resulting in a

significant estate tax liability.    The estate contended a cause

of action against the law firm arose during the decedent’s

lifetime because she was entitled to recover the fees paid to

the law firm for drafting defective testamentary documents.      We

held, however, that the additional amount of estate tax, not the

fee decedent paid to the attorneys, was the injury or damage

proximately caused by the legal malpractice.    Rutter, 264 Va. at

314, 568 S.E.2d at 695.   Therefore, no cause of action came into

existence during the decedent’s lifetime as to the estate tax

liability and thus the claim did not survive her death.    Id.

     The distinctly different interpretations of the “payment

rule” expressed by the litigants illustrates the difficulty in

construing our holding in Duesterdick with our decisions in

Stone, Laburnum, VMI, and Keller and other cases for purposes of

the accrual of the statute of limitations.     If, as we have

consistently held, even slight damage sustains a cause of

action, it is difficult to discern how the existence of a cause

of action can be postponed until some payment in partial or

whole satisfaction of the client’s damage has occurred.    The

infirmities of such a rule are obvious.

     First and foremost, adherence to a payment rule would vest

the aggrieved client with the power to forestall the running of

the statute of limitations by the deferral of payment,


                                16
regardless of whether he has already suffered damages sufficient

to give rise to his cause of action.    It is the legislature that

decides when causes of action shall accrue, not plaintiffs.

     Second, such a rule does not protect a client who, due to

bankruptcy or insolvency, cannot afford to pay whatever damage

he has suffered.     “If the client has no cause of action until he

has paid the judgment against him, then the larger the judgment,

the greater the client’s burden and the lawyer’s impunity; the

greater the injury wrongfully inflicted, the less the liability

of the wrongdoer.”    Duesterdick, 217 Va. at 767, 232 S.E.2d at

777 (Poff, J., dissenting).

     Finally, the “payment rule”, in a statute of limitations

context, would work an injustice on attorneys who may be forced

to defend allegations of malpractice brought many years after

the alleged breach occurred, dependent entirely upon the ability

or whim of the complaining client to pay the resulting damages.

In this regard the “payment rule” defeats the primary objectives

of statutes of limitations, such as compelling “the exercise of

a right of action within a reasonable time,” Street v. Consumers

Min. Corp., 185 Va. 561, 575, 39 S.E.2d 271, 277 (1946),

preventing surprise, and avoiding problems “incident to the

gathering and presentation of evidence when claims have become

stale.”   Truman v. Spivey, 225 Va. 274, 279, 302 S.E.2d 517, 519




                                  17
(1983).   Application of the “payment rule” to the facts of the

case at bar, as the Shipmans urge, illustrates these defects.

     Even if we determined that when the Shipmans hired the

second attorney they incurred legal fees, and thus damages

sufficient to establish a cause of action, there is no

indication in the record as to when those fees were paid.    If

they had given a retainer to that attorney on their first visit,

presumably the “payment rule” would then be satisfied and their

cause of action would begin to accrue.   Suppose, instead, the

Shipmans did not pay their attorney for six months, one year, or

longer.   Such a scenario exemplifies why the payment rule would

frustrate the will of the legislature and circumvent the

objectives of the statutes themselves if made applicable in a

statute of limitations context.

     In the context of a judgment entered against a client by

virtue of his attorney’s purported negligence, we said in

Duesterdick, “until the client has made a payment on that debt

he has suffered no actual loss or damage.”    217 Va. at 766, 232

S.E.2d at 776.   For the reasons set forth above, we conclude

that this is an incorrect statement of law.   As Justice Poff

stated in his dissent in Duesterdick, a client who suffers the

entry of a judgment against him indeed suffers a legal injury or

damage.




                                  18
     There is little remote, speculative, or
     contingent about a money judgment. Indeed, it is
     a legal creature of singular dignity. Such a
     judgment calls into existence what did not exist
     before, viz., a liquidated debt. Except for
     jurisdictional defect, that judgment and the debt
     it creates cannot be collaterally attacked and is
     actionable in every state. The recorded judgment
     constitutes a continuing lien (securing the debt
     and the interest as it accrues) on the debtor’s
     assets (presently owned and later acquired), a
     lien that is enforceable by public sale. Subject
     to the statute of limitations, the debt survives
     the debtor’s death and may be revived against his
     personal representative. Code § 8-396 (Cum.
     Supp. 1976). Some judgments, such as that
     suffered by the client here, survive bankruptcy.
     11 U.S.C. § 35.

Id., 217 Va. at 768, 232 S.E.2d at 777.

     Accordingly, our prior decision in Duesterdick is overruled

and cannot be viewed as supporting the Shipmans’ argument, which

we reject.

                          IV.   CONCLUSION

     “When the trial court has reached the correct result for

the wrong reason, we will assign the correct reason and affirm

that result.”   Mitchem v. Counts, 259 Va. 179, 191, 523 S.E.2d

246, 253 (2000); accord Hartzell Fan, Inc. v. Waco, Inc., 256

Va. 294, 303, 505 S.E.2d 196, 202 (1998); Ridgwell v. Brasco Bay

Corp., 254 Va. 458, 462, 493 S.E.2d 123, 125 (1997); Harrison &

Bates, Inc. v. Featherstone Assoc. Ltd. Partnership, 253 Va.

364, 369, 484 S.E.2d 883, 886 (1997).   Although the trial court

was initially correct in its ruling from the bench, it later



                                 19
held, incorrectly, that the Shipmans’ cause of action accrued

“when counsel was retained and paid.”

     For the reasons stated above, the Shipmans’ cause of action

for legal malpractice accrued at the time of the attorney’s

breach, subject to the continuous representation rule.7

Therefore, the Shipmans failed to timely prosecute their claim

against Kruck and the trial court correctly granted Kruck’s plea

in bar.   We will therefore affirm the judgment of the trial

court.

                                                          Affirmed.




     7
       No argument was made in the present litigation concerning
any tolling effect of the bankruptcy on the Shipmans’
malpractice claim under federal law or Code § 8.01-229, or
concerning the statute of limitations effect on the nonsuit of
the original motion for judgment. Hence, we express no opinion
on such arguments in the present disposition.

                                20