Texas Supreme Court justices on Thursday considered questions about whether an exonerated criminal defendant must be declared "actually innocent" to sue a criminal defense attorney for legal malpractice, and how the statute of limitations might apply to those claims.

The case, Gray v. Skelton, involves a dispute between attorney Patricia Skelton, who was convicted in 2007 of forging the will of a client, but her conviction was overturned because of ineffective assistance of her criminal defense attorney, Guy James Gray. Prosecutors dismissed Skelton's charge rather than retrying her case, and later, Skelton sued Gray for legal malpractice.

The dispute before the high court involves arguments to extend two long-established legal malpractice precedents. In 1995's Peeler v. Hughes & Luce, the Texas Supreme Court ruled that only an exonerated criminal defendant is allowed to sue a criminal defense attorney for legal malpractice. The high court's 1991 ruling in Hughes v. Mahaney & Higgins says that the statute of limitations is tolled in a legal-malpractice case until the underlying litigation, where the alleged malpractice occurred, is completely finished.

On one side, Gray's attorneys argue that Skelton wasn't technically exonerated because she wasn't declared actually innocent, which means the Peeler doctrine bars her claims. However, Skelton counters that the Peeler doctrine allows legal-mal claims when convictions are otherwise overturned, and that Skelton's situation qualifies.

Gray is arguing for the justices to find that Hughes tolling started the clock on the statute of limitations when Skelton lost her direct appeal in 2011. In contrast, Skelton argues that the justices should extend Hughes tolling to begin limitations when her conviction was overturned and prosecutors dismissed her charges.

At the oral argument, some justices indicated that actual innocence is an element of exoneration under the Peeler doctrine, and multiple justices seemed wary to draft a tolling rule that would inadvertently create an infinite statute of limitations.

Justice Jeff Boyd asked Skelton's attorney, Leslie Sara Hyman of Pulman, Cappuccio & Pullen in San Antonio, whether she would agree if the Supreme Court found that Skelton did need an actual innocence finding to sue for legal malpractice, but then allowed her to prove that as a causation element during the proceeding on her legal-mal claims.

Hyman said she would not object. However, Gray's attorney, Scott Douglass & McConnico partner Jane Webre of Austin, said she doesn't think it's appropriate for the court to allow a client to argue she's actually innocent during a legal-mal case. That should be a threshold matter before a client is allowed to sue her attorney, Webre said.

Justice Brett Busby said that in the federal courts, limitations are tolled until the end of a direct appeal, but then if a defendant seeks state post-conviction habeas relief, that would again pause limitations. Busby asked whether it was a viable option in Texas courts.

Webre said that type of rule would create tremendous uncertainty because in Texas, there's no deadline to seek post-conviction habeas relief, and some defendants initiate multiple habeas proceedings.

"It's maybe never that limitations run," she said, urging the justices to draw a "bright line" for Hughes tolling to begin when a direct appeal ends, so that parties have clarity and certainty.

On the other side, Hyman said the Hughes tolling rule is supposed to toll limitations until litigation is concluded. For Skelton, that happened after she won habeas relief to overturn her conviction, and a prosecutor dismissed her charge.

Justice Eva Guzman said a criminal-defendant may win habeas relief within three years, or it could be 20. If the court allowed tolling for such a long time, it could create "long tail liability" for lawyers, she said.

Justice Jane Bland said it seemed like Hyman was arguing for an endless, infinite exception to the statute of limitations for criminal defendants to sue their attorneys. That's not in law the legislature passed, she noted.

In reply, Hyman said the judiciary, not the Legislature, created both the discovery rule, which allows a client to sue for legal malpractice within two years of the time they discovered the malpractice, and the Hughes tolling rule. Philosophically, it's no different to hold that Hughes tolling in a criminal case applies when a habeas corpus proceeding overturns a conviction, she said.