Your attorney negligently steered you into bankruptcy?  It could be a good cause of action in legal malpractice.  A few technicalities, however.  Do you still have standing to sue the attorney?  Likely not.  In Burbacki v Abrams, Fensterman, Fensterman, Eisman, Formato, Ferrara & Wolf, LLP  2019 NY Slip Op 04128  Decided on May 29, 2019  the Appellate Division, Second Department explains why:

“The commencement of a bankruptcy proceeding creates an “estate” that is comprised of “all legal or equitable interests of the debtor in property as of the commencement of the case” (11 USC § 541[a][1]; see Osborne v Tulis [In re Osborne], 2013 US Dist LEXIS 190402, *5 [SD NY, No. 13 CV 2803 (VB)]). “Upon the filing of a voluntary bankruptcy petition, all property which a debtor owns, including a cause of action, vests in the bankruptcy estate” (Keegan v Moriarty-Morris, 153 AD3d 683, 684 [internal quotation marks omitted]; see 11 USC § 541[a][1]; Osborne v Tulis [In re Osborne], 2013 US Dist LEXIS 190402, *5-6). “Although federal law determines when a debtor’s interest in property is property of the bankruptcy estate, property interests are created and defined by state law” (In re Ross, 548 BR 632, 637 [ED NY], affd sub nom. Mendelsohn v Ross, 251 F Supp 3d 518 [ED NY]; see Broadwall Am., Inc. v Bram Will-El LLC, 32 AD3d 748, 750). Causes of action that accrue under state law prior to the filing of a bankruptcy petition, as well as those that accrue as a result of the filing, are property of the estate (see Johnson, Blakely, Pope, Bokor, Ruppel & Burns, P.A. v Alvarez [In re Alvarez], 224 F3d 1273, 1277-1278 [11th Cir]; Winick & Rich, P.C. v Strada Design Assocs. [In re Strada Design Assocs.], 326 BR 229, 235 [SD NY]). “[A] debtor’s failure to list a legal claim as an asset in his or her bankruptcy proceeding causes the claim to remain the property of the bankruptcy estate and precludes the debtor from pursuing the claim on his or her own behalf” (123 Cutting Co. v Topcove Assoc., 2 AD3d 606, 607; see 11 USC § 554; Ladson v Fessel, 85 AD3d 1128, 1129; see also Dynamics Corp. of Am. v Marine Midland Bank-N.Y., 69 NY2d 191, 195-196).

Here, the plaintiff’s legal malpractice cause of action accrued on March 20, 2012, when she, acting on the defendants’ advice, filed the bankruptcy petition (see McCoy v Feinman, 99 NY2d 295, 301; Tantleff v Kestenbaum & Mark, 131 AD3d 955, 956; Landow v Snow Becker Krauss, P.C., 111 AD3d 795, 796). Since the plaintiff had an interest in the legal malpractice cause of action “as of the commencement of the case” (11 USC § 541[a][1]), we agree with the Supreme Court’s conclusion that the cause of action was property of the bankruptcy estate and that the plaintiff lacked the legal capacity to sue on that cause of action (see Williams v Stein, 6 AD3d 197, 198; Osborne v Tulis [In re Osborne], 2013 US Dist LEXIS 190402, *7-8; see also Johnson, Blakely, Pope, Bokor, Ruppel & Burns, P.A. v Alvarez [In re Alvarez], 224 F3d at 1275-1278).”

 

 

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Andrew Lavoott Bluestone

Andrew Lavoott Bluestone has been an attorney for 40 years, with a career that spans criminal prosecution, civil litigation and appellate litigation. Mr. Bluestone became an Assistant District Attorney in Kings County in 1978, entered private practice in 1984 and in 1989 opened his private law office and took his first legal malpractice case.

Since 1989, Bluestone has become a leader in the New York Plaintiff’s Legal Malpractice bar, handling a wide array of plaintiff’s legal malpractice cases arising from catastrophic personal injury, contracts, patents, commercial litigation, securities, matrimonial and custody issues, medical malpractice, insurance, product liability, real estate, landlord-tenant, foreclosures and has defended attorneys in a limited number of legal malpractice cases.

 

Bluestone also took an academic role in field, publishing the New York Attorney Malpractice Report from 2002-2004.  He started the “New York Attorney Malpractice Blog” in 2004, where he has published more than 4500 entries.

Mr. Bluestone has written 38 scholarly peer-reviewed articles concerning legal malpractice, many in the Outside Counsel column of the New York Law Journal. He has appeared as an Expert witness in multiple legal malpractice litigations.

Mr. Bluestone is an adjunct professor of law at St. John’s University College of Law, teaching Legal Malpractice.  Mr. Bluestone has argued legal malpractice cases in the Second Circuit, in the New York State Court of Appeals, each of the four New York Appellate Divisions, in all four of  the U.S. District Courts of New York and in Supreme Courts all over the state.  He has also been admitted pro haec vice in the states of Connecticut, New Jersey and Florida and was formally admitted to the US District Court of Connecticut and to its Bankruptcy Court all for legal malpractice matters. He has been retained by U.S. Trustees in legal malpractice cases from Bankruptcy Courts, and has represented municipalities, insurance companies, hedge funds, communications companies and international manufacturing firms. Mr. Bluestone regularly lectures in CLEs on legal malpractice.

Based upon his professional experience Bluestone was named a Diplomate and was Board Certified by the American Board of Professional Liability Attorneys in 2008 in Legal Malpractice. He remains Board Certified.  He was admitted to The Best Lawyers in America from 2012-2019.  He has been featured in Who’s Who in Law since 1993.

In the last years, Mr. Bluestone has been featured for two particularly noteworthy legal malpractice cases.  The first was a settlement of an $11.9 million dollar default legal malpractice case of Yeo v. Kasowitz, Benson, Torres & Friedman which was reported in the NYLJ on August 15, 2016. Most recently, Mr. Bluestone obtained a rare plaintiff’s verdict in a legal malpractice case on behalf of the City of White Plains v. Joseph Maria, reported in the NYLJ on February 14, 2017. It was the sole legal malpractice jury verdict in the State of New York for 2017.

Bluestone has been at the forefront of the development of legal malpractice principles and has contributed case law decisions, writing and lecturing which have been recognized by his peers.  He is regularly mentioned in academic writing, and his past cases are often cited in current legal malpractice decisions. He is recognized for his ample writings on Judiciary Law § 487, a 850 year old statute deriving from England which relates to attorney deceit.