You’ve put together a nice sum of money, and now you want to buy that townhouse in Manhattan.  Surely, its the crown of real estate…unless you are unable to put a 5th story on top because the prior owners already sold the air rights.  So, you find out, and unfortunately, cancel the contract?  Not in this case, where the allegations are that the law firm negligently failed to tell the contractee that the air rights were already sold, and failed to tell him while he could still cancel the contract.

Saviano v Corniccelo  2015 NY Slip Op 31447(U)  August 3, 2015  Supreme Court, New York County  Docket Number: 153168/2014  Judge: Kelly A. O’Neill Levy tells us how the initial motion practice comes out.

“Plaintiffs allege in their complaint that in or around September 2010, Saviano identified a
four-story residential brownstone building located at 218 East 301 h Street, New York, New York (“the Building”), then owned by Dianova USA, Inc. (“Seller”), for purchase. Saviano intended to add a fifth floor to the Building, combining the fourth and fifth floors to create a duplex for himself and his family (“the Planned Duplex”). Saviano retained Defendants in connection with the purchase thereof. Saviano concedes that he did not sign a retainer agreement with Defendants. In November 2010, Saviano placed a formal bid on the Building, which the Seller accepted. On or about February 3; 2011, they entered into a Contract of Sale (“Contract”) to purchase the Building for $2.2 million. Prior to entering into the Contract, Saviano “specifically and explicitly” told Defendants he intended to create the Planned Duplex. (Amended Complaint, ,-i 20). Saviano told Defendants that he was a first-time buyer, inexperienced in real property matters, and was fully reliant on Defendants’ knowledge, experience and expertise. (Amended Complaint , 26). Defendants “promised” Saviano that there were “no legal impediments” to construction of the Planned Duplex. (Amended Complaint ,-21)”

In June of 2011 Defendants received a title report for the Building which showed that the air and development rights over the Building had already been sold, effectively preventing any upward construction. Plaintiffs allege that Defendants neither consulted the title report nor informed Saviano of the contents thereof prior to the closing. (Amended Complaint~ 26). On June 14, 2011, acting on the advice of the Defendants, Saviano assigned all rights and interests in the Contract to the LLC. Defendants told Saviano the assignment was “a nominal and ministerial act” designed to insulate Saviano from li~bility. (Amended Complaint~ 37)°. Saviano signed the Assignmen·t of Contract individually and as a managing member of the newly created LLC. Saviano did not sign a retainer agreement with Defendants on behalf of the LLC. The closing was held on June 21, 2011. In or around May 2012, during a “chance discussion with a neighbor,” Plaintiffs learned that the air and development rights over the Building had been sold, making it impossible to construct the Planned Duplex. (Amended Complaint ~ 40). Plaintiffs assert that they would not have entered into any agreement to purchase the Building had they been aware ofthe title report, and that, but for the Defendants’ assurances and promises that construction of the Planned Duplex was permissible, Saviano would have exercised the termination option in the Contractto mitigate his losses prior to closing. Based on these allegations, Plaintiffs assert causes of action for professional malpractice and breach of contract. They seek to recover $3 .million in monetary damages for each cause of action and attorneys’ fees.”

“Standing is a threshold determination that the plaintiff has “an interest in the claim at issue in the lawsuit that the law will recognize as a sufficient predicate for determining the issue at the litigant’s request.” Caprer v Nussbaum, 36 AD3d 176, 182 (2d Dept 2006). “A plaintiff generally has standing only to assert claims on behalf of himself or herself.” Id. Under longstanding common law, a court has “no inherent power to right a wrong unless thereby the civil, property or personal rights of the plaintiff in the action or the petitioner in the proceeding are affected.” Socy. of Plastics Indus., Inc. v County of Suffolk, 77 NY2d 761, 772 (1991 )(internal citations omitted). In this regard, Defendants argue that Saviano, having assigned his rights and interests in the Contract to the LLC, never actually owned the Building, and as such cannot maintain any claims which flow “exclusively” from losses sustained by the LLC. (Defendants’ Memorandum of Law, dated Sept. 11, 2014, p. 14 ). The court disagrees. Defendants’ position interprets the standing issue too narrowly. The appropriate inquiry is whether Saviano has been aggrieved by Defendants’ actions such that he should be “allowed access to the courts to adjudicate the merits” of his individual claims. Caprer, 36 AD3d at 182. Assuming Defendants failed to advise Saviano of the air rights issue and the existence of the title report before the closing, and Saviano consequently lost the opportunity to exercise a termination clause in the Contract of Sale and the ability to live with his family in the Planned Duplex, there are sufficient facts to “cast [Saviano’s individual claims] in a form traditionally capable of judicial resolution” such that Saviano has standing to maintain them. Schlesinger v Reservists Comm. to Stop the War, 418 us 208, 220-221 (1974). ”