Lewis Brisbois Bisgaard & Smith LLP v Fishman  2019 NY Slip Op 30413(U) February 15, 2019 Supreme Court, New York County  Docket Number: 655198/2017 Judge: Gerald Lebovits is the story of bad planning and missed opportunities.  Lawfirm hired leading legal malpractice defense firm to defend it.  Why?  Presumably it lacked legal malpractice insurance.  The case did not go well for the defendant law firm.  Why?  It seems that there was no excuse for holding back a six-figure escrow.  And then comes the account stated problem.

“Defendants point out inconsistencies in plaintiffs account-stated claim and allege that defendants protested plaintiffs legal charges orally on several occasions and sent at least two letters of protest dated September 4, 2013, and November 26, 2013. A cause of action for an account stated is

“an agreement between the parties to an account based upon prior
transactions between them with respect to the correctness of the
separate items composing the account and the balance due, if any,
in favor of one party or the other. In the case of an existing
indebtedness, the agreement may be implied as well as express. An
agreement may be implied if a party receiving a statement of
account keeps it without objecting to it within a reasonable time
because the party receiving the account is bound to examine the
statement and object to it, if objection there be. Silence is deemed
acquiescence and warrants enforcement of the implied agreement
to pay …. In the absence of fraud, mistake or other equitable
considerations making it improper to recognize the agreement, it is
conclusive.” (Chisholm-Ryder Co. v Sommer & Sommer, 70 AD2d
429,431 [4th Dept 1979] [internal citations omitted].)

“A client’s receipt and retention of an attorney’s account, without objection within a reasonable time, and agreement to pay a portion of the indebtedness, gives rise to an actionable account stated.” (Rosenman Colin Freund Lewis & Cohen v Edelman, 160 AD2d 626, 626 [1st Dept 1990].)

In the present case, plaintiff issued 12 separate invoices from June 2011 through January 2013. Defendants’ letters of protest were dated September 4, 2013, and November 26, 2013, which were thus dated two years after the first outstanding invoice was issued and eight months after the last outstanding invoice was issued. Defendants’ objections to legal charges in these letters do not preclude plaintiffs account stated claim as they were made past a reasonable time to object to the account. Further, defendants never disputed any of the invoices issued to them and never contested the accuracy of the bills or billing entries therein, but rather, merely responded to plaintiffs requests for outstanding legal fees. Thus, this court adheres to the initial determination made on plaintiffs account stated claim for legal fees in its decision dated August 27, 2018 on plaintiffs motion for summary judgment. “