Joint Ventures often start out with an idealistic version of “Let’s Put on a Play!”  A and B decide that they can put together a business, and recruit monied friends C and D, and they put together, say, a nursing home.  Then B,C and D decide that they really don’t need A, and the trouble begins.  The attorney who was hired represented them all, didn’t she?

Mawere v Landau  2015 NY Slip Op 06317  Decided on July 29, 2015  Appellate Division, Second Department is an example of how the attorneys can get themselves into trouble.

“The instant action involves the purchase of Ruby Weston Manor and Marcus Garvey Residential Rehab Pavilion, Inc., which were both financially troubled nursing home facilities [*2]located in Brooklyn. The plaintiff, Jonathan Mawere, alleges that the defendants Joel Landau and Jack Basch agreed to jointly purchase and operate the facilities together with him, via operating companies, the nominal defendants Alliance Health Associates, Inc., and Alliance Health Property, LLC, but that Landau and Basch, along with the defendants Leibel Rubin, Marvin Rubin, and Solomon Rubin (hereinafter collectively the purchasing defendants) ultimately excluded him from the transaction. He further alleges that the defendants Garfunkel Wild, P.C., and Judith Eisen, a partner in that firm (hereinafter together the law firm defendants), breached fiduciary obligations they owed to him by helping the purchasing defendants complete the transaction. The purchasing and nominal defendants moved, and the law firm defendants separately moved, inter alia, pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against each of them. The Supreme Court granted those branches of the motions, and the plaintiff appeals.”

“However, the Supreme Court should not have granted those branches of the law firm defendants’ motion which were pursuant to CPLR 3211(a)(1) and (7) to dismiss the eleventh and fourteenth causes of action, alleging legal malpractice and breach of fiduciary duty, asserted against them. The documentary evidence they submitted did not conclusively establish that no attorney-client relationship existed between them and the plaintiff (see CPLR 3211[a][1]). Furthermore, granting all favorable inferences to the plaintiff, the allegations in the complaint were sufficient to plead the existence of an attorney-client relationship between the law firm defendants and the plaintiff (see CPLR 3211[a][7]; Tropp v Lumer, 23 AD3d 550, 551), and that the law firm defendants committed legal malpractice and breached their fiduciary duties to the plaintiff (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442; Kurtzman v Bergstol, 40 AD3d 588, 590; Collins v Telcoa Int’l Corp., 283 AD2d 128, 134).”