Millian v Hafif & Assoc., PLLC   2018 NY Slip Op 51421(U)  Decided on October 9, 2018  Supreme Court, New York County  St. George, J. is the story of a condo purchase gone wrong.  Many of the construction legal malpractice cases arise from water damages, as does this one.

“In this legal malpractice case, plaintiffs allege that defendants were negligent in their due diligence work in connection with plaintiffs’ purchase of a condominium unit in Manhattan. The closing took place in May 2012. More specifically, they state that defendants did not inform them of the HVAC problems in the building which directly impacted their unit or of the fact that the ongoing assessments in the building would end before they purchased the unit. Plaintiffs claim, inter alia, that they incurred damages repairing the HVAC, that they lost income they would have obtained had they been able to rent the unit, and that they had to pay the unexpected assessments. They claim that they relied on defendants’ representations as to the unit and the building, and that they would not have purchased the unit if defendants had performed their due diligence and notified them of these problems.

Currently, defendants move for summary judgment. They point out that a claim for legal malpractice must show negligence, proximate cause, and actual damages, and they assert that plaintiffs cannot satisfy this standard. They state their due diligence complied with the prevailing [*2]standards and they reviewed the building’s October 4, 2011 board minutes, financial statements for the fiscal year ending May 31, 2010, and a March 26, 2012 letter from the building’s management company stating the assessments would continue in April and May of 2012. They note that their due diligence report, which they provided to plaintiffs prior to the execution of the contract of sale, noted that there had been a leak in the unit and incorporated the management company’s comments about the April and May assessments. They state that they could not have obtained copies of the April 4, 2012 board meeting minutes because they “would certainly not have been available to the Defendants while they were performing the due diligence at issue” (Defendants’ Mem of Law, p 5). Thus, there is no negligence, they claim.”

“After careful consideration, the Court denies the motion and declines to award summary [*4]judgment on the issue of liability to plaintiffs. As noted, a prima facie case for legal malpractice requires proof that the attorneys did not provide services which satisfied the legal community’s standards (see Ss Marks LLC v Morrison Cohen LLP, 133 AD3d 441, 441 [1st Dept 2015], lv denied, 27 NY3d 901 [2016]). Although litigation often turns on the issue of causation, courts must also consider the community standards. Here, neither party addresses this concern. Instead, defendants state, without support, that they adhered to the applicable standard and plaintiffs, without support, state there was a deviation. Without such evidence, it is impossible to reach a conclusion as a matter of law. In addition, the parties present conflicting versions of the facts. For example, they dispute whether Ms. Martel provided incorrect or insufficient information in response to Ms. Kristina Millian’s questions, whether information about the assessments and the HVAC problems would have been ascertainable through ordinary care, and whether the answers to these questions, as were available at this time, would have made a difference to plaintiffs. In light of this, there are questions of fact best reserved for the factfinder.

The Court additionally concludes that plaintiffs have submitted evidence, such as the verified bill of particulars dated September 16, 2016 and the annexed documents, and the HVAC repair estimate, to raise an issue of fact as to damages. As such, a question of fact for the jury remains to determine which of these damages can be substantiated and are recoverable, as the parties have not provided a definitive resolution of these questions. The Court rejects defendants’ position — for which they provide no support — that because the value of the unit increased, plaintiffs can mitigate their damages. Among other things, 1) the value of the unit is not related to either party’s conduct, 2) mitigation should not require plaintiffs to sell their unit, and 3) plaintiffs still incurred expenses repairing the HVAC and still had to provide rent abatements and separate heating and air conditioning units while the HVAC repairs were ongoing. The Court has considered all the parties’ arguments and they do not alter the conclusion that neither party has established a right to judgment at this time. Therefore, it is

ORDERED that the motion is denied.”