The Kentucky Divorce Law Journal reports this legal malpractice case. Baker v. Coombs  Here is the DLJ’s analysis:

"Baker filed for divorce from her husband, Collins, in 1989. A divorce decree, which referenced their Property Settlement Agreement, was entered in 1990. As part of the Agreement, Collins agreed to pay Baker $500,000. A balloon payment of $300,000 was due by January 1, 2002 and the remaining $200,000 due in ten annual installments of $20,000 continuing through January 1, 2001. The Agreement also provided that if the balloon payment was paid prior to the due date, the other payments would be forgiven. As security for the payments, Baker was given liens on all of Collin’s stock holdings of closely held corporations. Collin was to “execute all necessary documents to effectuate these liens” and “the Certificates shall be held by Ronald Coombs, Attorney.” Coombs represented Collins in the divorce proceedings and in other matters.
Despite the Agreement, Collins never gave Coombs any stock certificates before Collins died in September 1999. Coombs asked Collins for the certificates, but Collins never delivered them. Shortly before Collin’s death, Baker discovered that he had sold his interest in his largest corporation in 1992 without perfecting a lien in his stock holdings and making the agreed upon transfer to Baker. Baker did not know what happened to the other corporations, but none of them were listed as assets of his estate. Baker did not know whether any liens were ever prepared and she could not recall inquiring as to the liens or certificates prior to Collin’s death.
In November 1999, Baker filed a proof of claim against Collin’s estate for monies owed to her under the Agreement. The estate objected. Therefore in December 1999, she filed a complaint against the estate, Collin’s widow, and Coombs. Baker alleged that properties were transferred out of Collin’s name, prior to his death, in a deliberate attempt to prevent the payment of monies he owed to her and to reduce the inheritance of his child. She also alleged that Coombs failed to follow the terms of the Agreement in not holding the stock certificates and allowing Collin’s to sell his businesses without taking action to assure that Baker be paid what she was owed.
Baker was awarded a judgment against the estate. Baker and Coombs then filed cross motions for summary judgment. The trial court concluded that Coombs did not commit professional negligence and that he was not personally liable for the monies Collins owed Baker. The court held that Coombs signed the Agreement only in his capacity as Collin’s counsel, and not as a party to the Agreement. Therefore, only Collins and his estate could be held liable. Baker appealed.


On appeal Baker argued: 1) Coombs placed himself in the position of becoming a fiduciary to her by agreeing to hold the stock certificates, and 2) she should be deemed a third party beneficiary of Coomb’s legal services because he agreed to hold the stock certificates as security for the payments owed to her. Baker argued that, under both theories, Coombs had an affirmative obligation to obtain the stock certificates from Collins, to compel Collins to provide them, or to advise Baker that he had not obtained them.
Regarding Baker’s argument that Coombs owed her a fiduciary duty as a result of being mentioned in the Agreement, the Court first noted that no such duty arose solely from the fact that Coombs signed the Agreement. CR 11 requires that attorneys sign pleadings. Next, the Court noted that in the Agreement Coombs, in effect, designated himself as a de facto escrow agent on behalf of Baker as to the certificates, despite his representation of Collins. Coombs created the appearance that a fiduciary duty might have arisen. However, after examining the literal language of the Agreement, the Court found that Coombs was obligated to hold and secure the certificates only after they were placed in his possession. Coombs had no affirmative duty to obtain the certificates or notify anyone that he was not in possession of them. Since Coombs never took possession of the certificates, his arguable duty to Baker never arose. It remained inchoate and unenforceable. If he had received the certificates, he would have been obligated to Baker for having voluntarily agreed to assume the fiduciary duties attached to holding the certificates.
Regarding Baker’s second argument, the Court noted that a legal malpractice claim may arise only to the attorney’s client. However, an attorney may still be liable to a third party because of events arising out of his representation of a client if the attorney’s acts are fraudulent or tortuous and result in injury to that third person. Liability may be found where the attorney is responsible for damage caused by his negligence to someone intended to be benefited by his actions regardless of any lack of privity. The Court found that absent willful and wanton conduct, fraud, or malice, Coombs owed no duty of care to Baker as a third party beneficiary since Coombs had a contractual obligation to represent Collins against Baker as the adverse party in the divorce proceedings.
The Court observed that Coombs became involved in a situation which had the potential to create a conflict of interest between him and his client. The Court warned that attorneys should review SCR 3.130, Rule 1.7 before taking similar steps and obtain prior clear consent from the parties if they choose to embark on an analogous course to preclude similar litigation.
Affirmed. "

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Andrew Lavoott Bluestone

Andrew Lavoott Bluestone has been an attorney for 40 years, with a career that spans criminal prosecution, civil litigation and appellate litigation. Mr. Bluestone became an Assistant District Attorney in Kings County in 1978, entered private practice in 1984 and in 1989 opened…

Andrew Lavoott Bluestone has been an attorney for 40 years, with a career that spans criminal prosecution, civil litigation and appellate litigation. Mr. Bluestone became an Assistant District Attorney in Kings County in 1978, entered private practice in 1984 and in 1989 opened his private law office and took his first legal malpractice case.

Since 1989, Bluestone has become a leader in the New York Plaintiff’s Legal Malpractice bar, handling a wide array of plaintiff’s legal malpractice cases arising from catastrophic personal injury, contracts, patents, commercial litigation, securities, matrimonial and custody issues, medical malpractice, insurance, product liability, real estate, landlord-tenant, foreclosures and has defended attorneys in a limited number of legal malpractice cases.

Bluestone also took an academic role in field, publishing the New York Attorney Malpractice Report from 2002-2004.  He started the “New York Attorney Malpractice Blog” in 2004, where he has published more than 4500 entries.

Mr. Bluestone has written 38 scholarly peer-reviewed articles concerning legal malpractice, many in the Outside Counsel column of the New York Law Journal. He has appeared as an Expert witness in multiple legal malpractice litigations.

Mr. Bluestone is an adjunct professor of law at St. John’s University College of Law, teaching Legal Malpractice.  Mr. Bluestone has argued legal malpractice cases in the Second Circuit, in the New York State Court of Appeals, each of the four New York Appellate Divisions, in all four of  the U.S. District Courts of New York and in Supreme Courts all over the state.  He has also been admitted pro haec vice in the states of Connecticut, New Jersey and Florida and was formally admitted to the US District Court of Connecticut and to its Bankruptcy Court all for legal malpractice matters. He has been retained by U.S. Trustees in legal malpractice cases from Bankruptcy Courts, and has represented municipalities, insurance companies, hedge funds, communications companies and international manufacturing firms. Mr. Bluestone regularly lectures in CLEs on legal malpractice.

Based upon his professional experience Bluestone was named a Diplomate and was Board Certified by the American Board of Professional Liability Attorneys in 2008 in Legal Malpractice. He remains Board Certified.  He was admitted to The Best Lawyers in America from 2012-2019.  He has been featured in Who’s Who in Law since 1993.

In the last years, Mr. Bluestone has been featured for two particularly noteworthy legal malpractice cases.  The first was a settlement of an $11.9 million dollar default legal malpractice case of Yeo v. Kasowitz, Benson, Torres & Friedman which was reported in the NYLJ on August 15, 2016. Most recently, Mr. Bluestone obtained a rare plaintiff’s verdict in a legal malpractice case on behalf of the City of White Plains v. Joseph Maria, reported in the NYLJ on February 14, 2017. It was the sole legal malpractice jury verdict in the State of New York for 2017.

Bluestone has been at the forefront of the development of legal malpractice principles and has contributed case law decisions, writing and lecturing which have been recognized by his peers.  He is regularly mentioned in academic writing, and his past cases are often cited in current legal malpractice decisions. He is recognized for his ample writings on Judiciary Law § 487, a 850 year old statute deriving from England which relates to attorney deceit.