Jeffrey M. Rosenblum, P.C. v Casano  2014 NY Slip Op 51629(U) [45 Misc 3d 1218(A)] Decided on November 19, 2014   District Court Of Nassau County, First District  Fairgrieve, J. is an example of what happens when law firms sue to obtain payments.  They trigger lots of litigation and almost always. a legal malpractice counterclaim.  Here, in this Nassau County District Court, where the jurisdictional limit is $ 15,000 the attorneys have triggered a much bigger legal malpractice counterclaim.

“Before the court is plaintiff’s motion to dismiss defendant’s five (5) counterclaims. Said motion is decided as provided herein.

In her Verified Answer with Counterclaims (Plaintiff’s Exhibit B), defendant sets forth [*2]and classifies each of the five (5) counterclaims raised therein. They are designated as Breach of Contract (First and Second Counterclaims), Unjust Enrichment (Third Counterclaim), Declaratory Judgment (Fourth Counterclaim), and Attorney Malpractice (Fifth Counterclaim).

Initially, plaintiff’s counsel presses two arguments for dismissal of the first four counterclaims. First, she argues that pursuant to CPLR 3211(a)(2), this court lacks subject matter jurisdiction because “the monetary jurisdictional limit of the District Court is $15,000,” which these counterclaims exceed (Affirmation in Support, ¶ 22). To the contrary, however, this court “shall have jurisdiction of counterclaims … for money only, without regard to amount” (UDCA §208[b]). Accordingly, plaintiff’s argument characterizing the amount sought by defendant’s counterclaims as exceeding statutory authority, is rejected. Therefore, its requests for dismissal on this basis are denied.”

“Lastly, plaintiff seeks dismissal of the fifth and final counterclaim on two grounds. The first isres judicata and identity of issues with the earlier arbitration proceeding herein. In this regard, it is uncontroverted that this case was previously arbitrated pursuant to 22 NYCRR Part 137, that said arbitration resulted in a decision in defendant’s favor and that plaintiff timely commenced a trial de novo pursuant to 22 NYCRR 137.8. Given same, the arguments proferred by plaintiff to dismiss defendant’s fifth counterclaim are inapplicable to the present case.

The cases cited by plaintiff, Wallenstein v Cohen, 45 AD3d 674 (2d Dept 2007) and Altamore v Friedman, 193 AD2d 240 (2d Dept 1993), involved different arbitration statutes. Moreover, the arbitration statute in Wallerstein was repealed on January 1, 2002, and the Altamore case was specifically premised upon the binding nature of the arbitration involved in that proceeding. Unlike either of these cases, the arbitration provision used herein, explicitly provides a non-prevailing party with the opportunity to elect to proceed to a trial de novo, and plaintiff having done so, defendant can pursue her counterclaim. Therefore, that portion of plaintiff’s motion seeking dismissal of defendant’s fifth counterclaim, on res judicata grounds, is denied.

Plaintiff also seeks dismissal of said fifth counterclaim based upon an alleged failure of defendant to state a claim. In considering a motion to dismiss a complaint pursuant to CPLR 3211(a)(7) for failure to state a cause of action, the court must accept the facts alleged as true and make a determination as to whether the facts alleged are within any cognizable legal theory (see Holmes v Gary Goldberg & Co., Inc., 40 AD3d 1033 [2d Dept 2007]). The non-moving party is afforded “the benefit of every possible inference” (see Goshen v Mut. Life Ins. Co., 98 NY2d 314, 326 [2002], quoting Leon v Martinez, 84 NY2d 83, 87 [1994]). Therefore, if the pleading contains factual allegations which taken together manifest any cause of action cognizable at law, the motion must be denied (see Natural Organics, Inc. v Smith, 38 AD3d 628 [2d Dept 2007]).

In a legal malpractice action, the “plaintiff must prove (1) the negligence of the attorney, (2) that the negligence was the proximate cause of the loss sustained, and (3) proof of actual damages. Plaintiff must also prove that she would have succeeded on the merits of the underlying action but for’ the attorney’s negligence” (Tilton v Trezza, 2006 NY Slip Op 50867[U] [Sup Ct, Nassau Cty 2006], citing Davis v Klein, 88 NY2d 1008 [1996]). Review of ¶¶ 52-54 of defendant’s answer (Plaintiff’s Exhibit B), reveals that the above requisites for a claim sounding in legal malpractice have been satisfied. Accordingly, plaintiff’s request for dismissal of defendant’s fifth counterclaim, for failure to state a cause of action, is denied.”