Summary judgment in favor of defendant-attorneys is common; summary judgment in favor of the plaintiff-client is rare. Genesis Merchant Partners, L.P. v Gilbride, Tusa, Last & Spellane, LLC 2017 NY Slip Op 30430(U) February 27, 2017 Supreme Court, New York County Docket Number: 653145/2014 Judge: Nancy M. Bannon is an example of plaintiffs’ case, well-played.
“In this action to recover damages, inter alia, for legal malpractice, the plaintiffs move pursuant to CPLR 3212 for summary judgment on the issue of liability on so much of the first cause of action as alleges that the defendants committed legal malpractice in failing to perfect security interests in certain life insurance policies, and dismissing the defendants’ counterclaims for unpaid legal fees. The defendants oppose the motion. The motion is granted. ”
“The plaintiffs established their prima facie entitlement to judgment as a matter of law on the issue of liability on so much of the legal malpractice cause of action as is premised on the failure to perfect security interests in the insurance policies. A cause of action to recover for legal malpractice requires proof “that the attorney failed to exercise ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession and that the attorney’s breach of this duty proximately caused plaintiff to sustain actual and ascertainable damages.” Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY 3 d 4 3 8 I 4 4 2 ( 2 0 0 7 ) . Where, as here, an attorney fails to properly record a security interest or mishandles an express task for which he or she was engaged, it is a per se breach of the standard of care, and does not require expert testimony to establish a prima facie case, since ordinary experience of a fact finder would provide a sufficient basis for judging the adequacy of the professional service rendered. See Lory v Parsoff, 296 AD2d 535, 536 (2~d Dept. 2002); Deb-Jo Const., Inc. v Westphal, 210 AD2d 951, 951 (4th Dept. 1994); S & D Petroleum Co. v Tamsett, 144 AD2d 849, 850 (3rd Dept. 1988). A security interest in a life insurance policy may not be perfected by filing a UCC-1 financing statement with the Secretary of State (see ucc 9-109[d] ), but only by the actual possession of the original policy or the delivery of a properly executed collateral assignment to the underwriter of the policy. See Matter of Bickford, 265 App Div 266 (3rd Dept. 1942). Moreover, the plaintiffs established, prima facie, that the defendants’ failure to properly perfect the security interests in the policies proximately led to the plaintiffs’ inability enforce a lien on the policies after Progressive defaulted, and that the plaintiffs were unable to collect from Progressive in their Connecticut breach of contract action. Cf. Gladstone v Ziegler, 46 AD3d 366 (lsc Dept. 2007) (plaintiffs established liability, but could not demonstrate, prima facie, that their attorney’s failure to perfect a security interest proximately caused damages) . ”
“Rule 1.2(c) of the Rules of Professional Conduct provides that “[a] lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances, the client gives informed consent and where necessary notice is provided to the tribunal and/or opposing counsel.” Generally, where the scope of representation is properly limited, an attorney may not be held liable for his or her failure to undertake a task that falls outside of the scope of representation. See generally AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 435 (2007). The court, however, rejects the defendants’ contention that their submission is sufficient to defeat summary judgment. Even if there are factual disputes as to whether the defendants received any limiting instructions from Kelly and whether Kelly had authority to bind the plaintiffs with respect to the scope of representation, the plaintiffs established that the defendants, by filing the UCC-1 statements and billing the plaintiffs for that work, voluntarily assumed the obligation to perfect the security interests. Where one assumes a duty to act, the failure to perform the act in a proper fashion constitutes a breach of the assumed duty, and may render the actor liable in negligence. See Applewhite v Accuhealth, Inc., 21 NY3d 420, 431, 434 (2013); Palka v Servicemaster Mgt. Servs. Corp., 83 NY2d 579, 587 (1994); Podesta v Assumable Homes Dev. II Corp., 137 AD3d 767, 769 (2nd Dept. 2016); see generally Katz v United Synagogue of Conservative Judaism, 135 AD3d 458, 461 (1st Dept. 2016). Therefore, where a fiduciary, by its conduct, voluntarily assumes the obligation to properly deliver to, or file documentation with, a particular entity or governmental agency, the fiduciary’s failure to timely or properly deliver or file the documentation constitutes actionable negligence if it proximately causes damage to the plaintiff. See Nilazra, Inc. v Karakus, Inc., 136 AD3d 994, 996 (2nd Dept. 2016) (failure to file a certain notice with the Department of Taxation & Finance); see also AG Capital Funding Partners, L.P. v State Street Bank & Trust Co., 5 NY3d 582, 594 (2005) (failure to deliver secured indebtedness statement to a bank); Podesta v Assumable Homes Dev. II Corp., supra (failure to record partial satisfaction of mortgage) .”