A Puzzling Decision in Legal Malpractice

As the economic times turn around, we are still seeing the results of the mortgage bubble.  in Ferreira v Citiwide Real Estate & Mgt. Co.   2013 NY Slip Op 50745(U)   Decided on May 8, 2013
Supreme Court, Queens County   Kitzes, J.  we see a typical issue.  What happens when the system spins, and the owner is put on the street?  Litigation follows. 

Of particular interest is what happens when an attorney negligently or carelessly enters into a stipulation on behalf of a client in "open" court?  Case law says that the client is bound.  however. we are puzzled by what seems to be a complete lack of a remedy here.

" The court finds that plaintiff's proposed complaint adequately alleges a cause of action for legal malpractice based Mr. Solda's alleged failure to review the mortgage foreclosure file, and move to vacate the judgment of default, foreclosure and sale, and the referee's deed on the grounds of lack of personal jurisdiction, rather than entering into the stipulation of settlement which resulted in plaintiff vacating the subject premises. To the extent that Mr. Soldas asserts that he was only retained to represent Mr. Ferreira in the civil court matter, the retainer agreement does not identify the court in which the Deutsche Bank action was pending, does not contain an Index Number for the matter entitled "Deutsche Bank v J Ferreira, et al", and refers to "[a]ll legal matters relative to defense of claims arising out of the above referenced matter and the foreclosed property." The retainer agreement on its face, thus, does not specifically limit Mr. Solda's representation of Mr. Ferreira to the civil court matter.

However, to the extent that Mr. Ferreira alleges he did not authorize Mr. Solda to enter into the stipulation in civil court, this claim cannot form a basis for legal malpractice. It is well settled that a stipulation made by the attorney may bind a client even where it exceeds the attorney's actual authority if the attorney had apparent authority to enter into the stipulation (see Hallock v State of New York, 64 NY2d 224, 231 [1984]).

In view of the foregoing, with respect to the motion by defendant Deutsche Bank and Paul Solda, summary judgment dismissing the complaint is granted as against Deutsche Bank and denied as to Paul J. Solda, Esq.; cancellation of the notice of pendency against 24-27 Curtis Street, East Elmhurst, New York is granted; and an award of counsel fees and costs are denied. "

 

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