In a legal malpractice case worth more than $60 Million, is it possible that the testimony of a single witness at a deposition can make the essential difference?
In Nomura Asset Capital Corp. v Cadwalader, Wickersham & Taft LLP 2014 NY Slip Op 00954
Decided on February 13, 2014 Appellate Division, First Department Richter, J. bear in mind that a major issue in the legal malpractice case is whether Defendant advised Plaintiff of the REMIC rules. More than $60 million is at stake. Then read these paragraphs:
"Glick testified that she and Adelman had numerous discussions with Nomura’s securitization team about REMIC requirements. She submitted an affidavit stating that before the D5 Securitization closed, Cadwalader provided Nomura with "detailed advice" as to how to satisfy the 80% test. As part of that advice, Glick told Nomura to add together the value of what was plainly REMIC real property, such as land and structural improvements. If that sum amounted to at least 80% of the loan amount, the 80% test would be met. If not, Glick advised Nomura that it should make further inquiries to determine whether the loan met the 80% test. Adelman also advised Nomura that it should consult with Cadwalader if it had any questions about a particular loan.
Perry Gershon, a former vice president of Nomura who was in charge of the D5 [*6]Securitization, confirmed that Cadwalader properly advised Nomura of the REMIC rules. He testified that prior to the D5 Securitization, Cadwalader told him, and he understood, that a REMIC loan needed to be secured by real property worth at least 80% of the loan, that real property includes land and buildings, but not personal property, and that the appraisals of the collateral securing the mortgage loans in the trust had to separately value the real property.
The testimony of Adelman, Glick and Gershon satisfied Cadwalader’s prima facie burden on summary judgment showing that the allegedly missing advice was in fact given to Nomura (see Stolmeier v Fields, 280 AD2d 342, 343 [1st Dept 2001], lv denied 96 NY2d 714  [rejecting failure to advise claim where the client’s own deposition testimony showed he was aware of the advice]). Contrary to the motion court’s conclusion, we find nothing inconsistent in Gershon’s testimony. Gershon’s alleged inability to succinctly articulate the REMIC rules during his deposition, which took place more than 10 years after the advice was given, does not refute his unrebutted testimony that Cadwalader advised him of the relevant rules at the time of the D5 Securitization. Nor does the fact that Gershon is married to one of the Cadwalader attorneys who worked on the transaction, standing alone, raise an issue of fact. At his deposition, Gershon made clear that his wife’s employment at Cadwalader had no bearing on how he viewed the litigation. Nomura’s current argument to the contrary would only be based on speculation. In any event, even if we were to discount Gershon’s statements, the unchallenged testimony of Adelman and Glick shows that the proper REMIC advice was given.
Because Cadwalader met its prima facie burden on summary judgment, the burden shifted to Nomura "to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action" (Alvarez v Prospect Hosp., 68 NY2d 320, 324 ). Nomura failed to satisfy that burden. It points to no documentary evidence directly refuting the testimony of Adelman, Glick and Gershon that the proper REMIC advice was given. Nor did any witness testify that Cadwalader specifically failed to advise Nomura that the appraisals for the D5 Securitization had to separately value the real property components of the asset in question.
Thus, the motion court should have granted summary judgment dismissing the advice claim. "