Buying A Legal Malpractice Case and Then Losing the Receipt

Well, actually not "buying" the case and not losing the "receipt", nevertheless, plaintiff purchased 50% of an intended legal malpractice case and then lost the contract...or did he?

Pearlman v Faulisi  2013 NY Slip Op 31963(U)  August 7, 2013  Supreme Court, Suffolk County
Docket Number: 15123-2011  Judge: Emily Pines.  "In the Amended Verified Complaint, the plaintiff, Lee R. Pearlman (“Plaintiff’) alleges, among other things, that on or about July 13, 2007, he tendered $125,000 to defendant Peter Faulisi (“Faulisi”) in accordance with an agreement with Faulisi pursuant to which Plaintiff “purchased the rights to one half of any and all proceeds payable or attributable to Faulisi, whether directly from Faulisi’s claims in [a legal malpractice action pending in Federal court] or from his share of any monies paid to Protostorm, in an anticipated legal malpractice lawsuit to be brought by Protostorm and Faulisi against various attorneys.” Plaintiff alleges that he and Faulisi entered into a written contract regarding the Protostorm case and that Faulisi maintained sole custody of the written contract. Plaintiff claims that after they entered into the contract, Faulisi failed to respond to Plaintiffs repeated requests for a copy of the contract and documents regarding the Protostorm case. In the First cause of action, Plaintiff seeks a declaratory judgment and accounting from the defendants declaring that Plaintiff is entitled to 50% of Faulisi’s proceeds from the Protostorm case. In the Second cause of action, Plaintiff
seeks equitable relief (injunction, attachment, receivership) to safeguard Faulisi’s proceeds from the Protostorm case given what Plaintiff calls Faulisi’s extensive pattern of fraud, deceit and unsavory business practices. A copy of the alleged written contract is not annexed to the Amended Verified Complaint. Neither party produced the original or a copy of the written contract during discovery."

Defendants now move (Mot. Seq. 002) for summary judgment dismissing the First  and Second causes of action. In an affidavit in support of Defendants’ motion, Faulisi states, among other things, that the $125,000 check given to him by Pearlman on July 13, 2007, was a personal loan, and that there was no arrangement of any kind, or even any discussion, that the $125,000 was in exchange for a 50% interest in the Protostorm case. Defendants argue, among other things, that Plaintiff cannot meet his burden of demonstrating the existence of an enforceable contract between the parties because there is no writing signed by the parties containing the terms of such an agreement. Defendants contend that the $125,000 was nothing more than a loan between  Pearlman and Faulisi, to be repaid when Faulisi or Lean for Life Products, LLC, a start-up company of which Faulisi is Chief Operating Officer, had sufficient funds. "

Here, the Defendants allege that a written agreement forming the basis of the First and Second causes of action asserted by the Plaintiff never existed and contend that summary judgment must be granted because Plaintiff cannot produce the agreement and, therefore, cannot prove the existence of an enforceable contract. However, the Defendants cannot satisfy their initial burden by merely pointing to gaps in Plaintiff‘s case (see Johnson v Culinary Institute of America, 95 AD3d 1077, 1078 [2d Dept 2012). Moreover, the Defendants have failed to establish, as a matter of law, that secondary evidence of the contents of the agreement would be inadmissible at trial under the best evidence rule (see Schozer v William Penn Life Ins. Co. ofNew York, 84 NY2d 639,644
[1994]; Matter of Eshaghian; 100 AD3d 751, 752 [2d Dept 2012). "

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