This was the order of events in 135 Bowery LLC v Sofer 2016 NY Slip Op 31012(U) June 2, 2016 Supreme Court, New York County Docket Number: 108020/2011 Judge: O. Peter Sherwood.
“This is one of two cases based on the same set of facts. Steven Seitzman and Judith Scitzman (the Seitzmans) are the sole members of 135 Bowery, LLC ( 135 Bowery). 135 Bowery owned the property located at 135 Bowery, New York, New York (the Property). In 2007, the plaintiffs sold the Property with the assistance of their attorney, Alan Young (Young, now deceased), a partner at Lindenbaum & Young, to fund the Seitzmans’ retirement. Plaintiffs claim that Young diverted the proceeds of the sale, sent some of it to entities he controlled, used other monies to buy real property for his own benefit, and lied to the Seitzmans about the status of their investments. ”
“Steven Seitzman (Stcven) and Judith Seitzman (Judith) are owners of 135 Bowery Street, LLC. In April of 2007, they hired attorney Alan Young to represent them in connection with the sale of the Property. Young counseled them in the attempt of an United States Internal Revenue Code § 1031 exchange (by which taxes would be deferred if the proceeds are invested in other. similar, real estate within a specified time after the sale). Liebman was the exchange trustee. The sale of the building closed on December 28, 2007. At the closing, plaintiffs received net proceeds of $4,513,711. This sum. was deposited in the LY IOLA Account and eventually $4,672.553.64 was transferred to Liebman, the Section 1031 Exchange Trustee (Steven aff at ii 10-12, NYSCEF Doc Nos. 106, 114, 115, J 19).
On January 3, 2008, Young sent Liebman a letter instructing him lo transfer $3,500,000 to LY to be used for down payments on the purchase of two parcels of .land in Sullivan County, New York (NYSCEF Doc. No. 116). Young attached unsigned draft contracts which purportedly provided a basis for the transfer (id.). One contract was for an 83 .19 acre parcel (the “83 Acre Property,” id). The other was for a single family home (the “Mosquera Property,” id). Young was listed as counsel for the seller on both contracts (id.). Patrick Lucas, an associate at LY, appears on the draft contracts as representing the purchaser in both transactions (id.; Robert tr., NYSCEF Doc. No. 112, p.26). 10717 is named in the contract as the seller of the 83 Acre Property, with provision for Petri signing on behalf of that entity. According to the Sullivan County Tax Map and Records System, the 83 Acre Property was owned by a George Bagely (NYSCEF Doc. No. 117). Liebman transferred $3,500,000 to the LY IOLA account that day (NYSCEF Doc No. 118). ”
“Where the complaint against an attorney alleges breach of fiduciary duty, fraud, aiding and abetting fraud, and negligent misrepresentation, and the claims are all predicated on the same allegations and seek identical relief to the legal malpractice claim, the former claims should be dismissed as redundant of the malpractice claim (see Ulico Casualty Co. v Wilson. Elser, Moskowitz. Edelman & Dicker, 56 AD3d 1, 14 (1st Dept 2008) dismissing breach of contract, breach of fiduciary duty, aiding and abetting breach of fiduciary duly and tortious interference with contractual relations claims as duplicative of the malpractice cause of action]; Nevelson v Carro. Spanbock, Kaster & Cuiffo, 290 AD2d 399, 400 [I st Dept 2002][ dismissing claims for breach of contract and breach of fiduciary duty as those claims were “predicated on the same allegations and seek relief identical to that sought in the malpractice cause of action”j Sitar v Sitar, 50 AD3d 667, 670 [2d Dept 2008] affirming dismissal of causes of action alleging fraudulent misrepresentation and negligent misrepresentations “insomuch as those causes of action arise from the same facts as the cause of action alleging legal malpractice and do not allege distinct damages”j; and Sage Realty Corp. v Proskauer Rose, 251 AD2d 35, 39 [1st Dept 1998] [breach of contract and fraudulent misrepresentation claims dismissed as redundant of malpractice claim I).
As is discussed below, the plaintif’s motion for summary judgment on the legal malpractice claim must be granted against Young and LY. It must be denied as against Robert and LYPC. “