Spiegel v Ahearn  2018 NY Slip Op 32472(U)  October 1, 2018  Supreme Court, New York County
Docket Number: 101251/2016  Judge: Melissa A. Crane is a very unusual case.

“Between 2006 and 2012, plaintiff pro se Michael Spiegel and defendants Thomas Ahearn, Liridona Kastrat, Kristopher Kennington, and David Ortiz were employed by the Hotel Edison (“Hotel”), located on West 47th Street in Manhattan (see Spiegel’s verified complaint, dated August 8, 2016 [complaint], ii 8). The defendants later sued the Hotel and its managers, claiming that the Hotel and its managers engaged in wrongful conduct with respect to their employment and termination. Spiegel brings this action to recover damages from the defendants for allegedly breaching the contract they entered with him in connection with the prosecution of the defendants’ claims, versus the Hotel (id ii 31 et seq.). ”

“Spiegel asserts three causes of action in his complaint, for breach of contract, quantum meruit, and “Debt Owed,” each alleged to arise from the “Legal Agreement” he entered with Ahearn, Kastrat, Kennington, and Ortiz, dated October 31, 2012 (Legal Agreement) (exhibit 1 to the Deubert affirmation).

In the Legal Agreement, Spiegel promised to help Defendants and Ahearn and Ortiz in the civil lawsuit they were contemplating against the Hotel: “Spiegel agree[d], for his part, to secure a lawyer for this action, to give full and complete aid in counsel for the preparation and planning of this lawsuit, up to and including trial and any appeal, and to also front any money paid to the lawyer as
an advance or other purpose, plus to front any money to be paid as ‘out of pocket expenses … Spiegel also agree[ d] to give testimony at the trial, as necessary and appropriate” (id. at 1 ).

For their part, Defendants promised to cooperate with Spiegel in the prospective lawsuit, and to provide testimony in a lawsuit Spiegel planned to bring on his own behalf against the Hotel (id.). 3 Among other things, Defendants also agreed that they would pay Spiegel 25% of any money they received from the Hotel in the lawsuit, through settlement or an award after trial, after deduction of attorneys’ fees and “fronted expenses” (id. at 1-2). With Spiegel’s assistance, shortly after their execution of the Legal Agreement, Defendants, along with Ahearn and Ortiz hired Neil Frank, Esq. of Frank & Associates, P.C. to represent them in their suit against the Hotel. In their retainer agreement with Frank’s law firm,  dated November 5, 2012, Defendants and Ahearn and Ortiz agreed to pay the firm $500 each as an initial intake fee, plus 35% of any negotiated settlement, plus disbursements paid on their behalf (Deubert affirmation exhibit 9, at 1 ). If the suit went to trial, the law firm would be paid any fees and expenses the court awarded (id.).

Spiegel admits that, although he is not an attorney, he is a businessman with extensive experience in civil litigation (see Defendants’ Rule 19-A Statement of Material Facts [SMF], 2-3; transcript of Michael Spiegel deposition, dated September 5, 2017 [Tr.], 36:19 to 42:5). Spiegel’s experience includes his own lawsuit against the Hotel, several grievance arbitration proceedings concerning his termination by the Hotel, several proceedings before New York State’s Department of Labor concerning his claim for unemployment benefits arising from his termination by the Hotel, a complaint with the Occupational Safety and Health Administration concerning conditions at the Hotel, and a complaint with the New York Division of Licensing Services concerning security guards at the Hotel (SMF ~~ 3, 7-11). Spiegel states that he has helped at least three other former Hotel employees bring lawsuits against the Hotel and has a financial interest in the outcome of one such suit (id. ~~ 4-5; Tr. 19:23-22:25). ”

“Defendants allege that the Legal Agreement is unenforceable because it calls for Spiegel’s unauthorized practice of law, in violation of Judiciary Law Section 478, that states, in pertinent part:
It shall be unlawful for any natural person to practice or appear as an attorney-at-law or as an attorney and counselor-at-law for a person other than himself or herself in a court of record in this state, or to furnish attorneys or counsel or an attorney and counsel to render legal services, or to hold himself or herself out to the public as being entitled to practice law as aforesaid, or in any other manner, ..
without having first been duly and regularly licensed and admitted to practice law
in the courts of record of this state, and without having taken the constitutional

This statute is intended “to protect our citizens against the dangers of legal representation and advice given by persons not trained, examined and licensed for such work, whether they be laymen or lawyers from other jurisdictions” (Spivak v Sachs, 16 NY2d 163, 168 [1965]). A contract violating Section 4 78 is illegal “and under our settled rules [New York courts] refuse to aid in it but leave the parties where they are” (Spivak, 16 NY2d at 168, citing McConnell v Commonwealth Pictures Corp., 7 NY2d 465 [1960]; see also El Gamayel v Seaman, 72 NY2d 701, 705 [1988] [“As a matter of public policy, a contract to provide services in violation of [Judiciary Law§ 478] is unenforceable in our state courts”]). ”

“Here, Defendants make their prima facie showing that Spiegel’s “aid in counsel” was the rendering of unauthorized legal advice in violation of New York’s Judiciary Law Section 478. Spiegel fails to raise any bona fide issue to defeat Defendants’ motion or to support his own cross motion. Accordingly, the court grants Defendants’ motion for summary judgment, and denies Spiegel’s cross motion for summary judgment, with respect to his first cause of action for breach of contract. ”