Client owns a gas station.  A  dump truck and a fuel truck collide and explode.  The station is closed for 5 years while remediation of the fuel spill goes on.  They sue the trucks, and lose.  Was this legal malpractice?

This case appears to be the first application of Grace v. Law in which the question of not taking an appeal and then starting a subsequent legal malpractice case comes up.  The AD was not “persuaded that an appeal would have been likely to succeed.”

Levine v Horton  2015 NY Slip Op 03021  Decided on April 9, 2015  Appellate Division, Third Department holds that the legal malpractice case survives a motion for summary judgment.

“We cannot agree with Young’s argument that he is entitled to dismissal of the legal malpractice action. Legal malpractice is established by evidence that an attorney “‘failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession which results in actual damages to a plaintiff, and that the plaintiff would have succeeded on the merits of the underlying action “but for” the attorney’s negligence'” (Leder v Spiegel, 9 NY3d 836, 837 [2007], cert denied sub nom Spiegel v Rowland, 552 US 1257 [2008], quoting AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434 [2007]; accord Hyman v Schwartz, 114 AD3d 1110, 1112 [2014], lv dismissed 24 NY3d 930 [2014]). In order to succeed on his motion for summary judgment, Young was required to establish the absence of negligence, or that any negligence on his part was not the cause of any actual or ascertainable damages to the owners (see Geraci v Munnelly, 85 AD3d 1361, 1362 [2011]; Guiles v Simser, 35 AD3d 1054, 1055 [2006]; Tabner v Drake, 9 AD3d 606, 610 [2004]).

In support of his motion, Young submitted an expert affidavit opining that he was not negligent because he had engaged the services of an expert who submitted a report suggesting that the spill site had not been completely remediated and the discovery schedule had not yet expired. Thus, Young argues, he was still in the process of obtaining additional proof of damages and had adequately opposed the fuel truck defendants’ motion. In opposition, plaintiff submitted an expert affidavit alleging that Young was negligent because he failed to conduct any relevant discovery prior to the motions being made, mistakenly limited the owners’ damages in their bill of particulars to the stigma associated with the property and failed to allege or establish the existence of the loss of revenue and property damages sustained by the owners. In view of the competing opinions regarding the adequacy of Young’s representation, we agree with Supreme Court that issues of fact exist requiring a trial (see M & R Ginsburg, LLC v Segal, Goldman, Mazzotta & Siegel, P.C., 90 AD3d 1208, 1209 [2011]; Maddux v Schur, 16 AD3d 873, 874 [2005]). Further, we cannot agree with Young’s contention that plaintiff’s failure to appeal the order dismissing the underlying action precluded plaintiff’s claim for legal malpractice, inasmuch as we are not persuaded that an appeal would have been likely to succeed (see Grace v Law, 24 NY3d 203, 210-211 [2014]).

Young also argues in the alternative that the owners did not sustain any damages as a result of the dismissal of their underlying action and, therefore, would not have succeeded on its merits “but for” his alleged negligence. In support of this argument, Young relies on the January 2007 appraisal reflecting that the value of the property was the same in January 2007 as it was prior to the fuel spill in November 2002, the fact that the Department of Environmental Conservation had closed its file on the spill, and that the owners had been reimbursed by their own insurer for all of the damages their adjuster had claimed to be caused by the accident. As we have noted, however, Young’s own expert called the remediation of the site into question. Moreover, the owners alleged that their damages included loss of revenue caused by the pumps not operating properly after the explosion, and Young himself testified at his deposition that he believed that the owners had been damaged above and beyond the amount that they had been paid by their insurer. Furthermore, plaintiff submitted an affidavit from a real estate appraiser opining that a stigma had indeed attached to the property as a result of the spill and that the accident had caused a decline in the gas station’s gross revenue. Although Young argues that a decline in gross revenue is insufficient to establish damage, that argument is countered by plaintiff’s contention that the owners’ prior revenue stream was able to cover their expenses and, with the decrease caused by the accident, they lost the ability to stay current on their mortgage, which led to the foreclosure on their property where both their business and their home were located. Under these circumstances, we agree with Supreme Court that issues of fact exist as to whether the owners were damaged by the alleged malpractice (see Lue v Finkelstein & Partners, LLP, 94 AD3d 1386, 1389 [2012]; M & R Ginsburg, LLC v Segal, Goldman, Mazzotta & Siegel, P.C., 90 AD3d at 1210-1211;Cramer v Englert, 262 AD2d 827, 831 [1999]). Given the existence of these questions of fact, we likewise find no basis for plaintiff’s request that we grant his cross motion for summary judgment.