There are several “key” cases in Pennsylvania legal malpractice cases, but none are more important than Kituskie v. Corbman, 552 Pa. 275, 714 A.2d 1027, 1030 (1998). In Kituskie, our Supreme Court, set forth in clear terms the “case within a case” standard used to analyze all legal malpractice actions. Pursuant to Kituskie, a plaintiff must establish: 1) The employment of the attorney or other basis for duty; 2) The failure of the attorney to exercise ordinary skill and knowledge; and; 3) That such failure was the proximate cause of damage to the plaintiff. Kituskie, 714 A.2d at 1030. The Court held that in a legal malpractice action arising from underlying litigation, actual loss can only be established by proving the plaintiff would have been successful in the underlying suit except for the failure of his attorney to exercise ordinary skill and knowledge.
As the Court observed:
A legal malpractice action is different because, as described above, a plaintiff must prove a case within a case since he must initially establish by a preponderance of the evidence that he would have recovered a judgment in the underlying action. It is only after the plaintiff proves he would have recovered a judgment in the underlying action that the plaintiff can then proceed with proof that the attorney he engaged to prosecute or defend the underlying action was negligent in the handling of the underlying action and that negligence was the proximate cause of the plaintiff’s loss since it prevented the plaintiff from being properly compensated for his loss.
Kituskie 714 A.2d at 1030. The court further held: “An essential element to this cause of action is proof of actual loss rather than a breach of a professional duty causing only nominal damages, speculative harm, or the threat of future harm.” Id.