Judge Billings untangles a complicated web of courts, causes and conclusions in Alphas v Smith 2019 NY Slip Op 33427(U) November 15, 2019 Supreme Court, New York County Docket Number: 155790/2015. Questions of when the representation began, who has privity, what was the scope of the representation and did other attorneys cut off the liability arc all are decided.
I. THE FOURTH AMENDED COMPLAINT
I The current complaint alleges that plaintiffs retained defendants on or about September 1, 2012, to represent plaintiffs Alphas and Alphas Company of NY and a separate corporation, Alphas Company, Inc., in several pending actions. Alphas is currently the sole shareholder of Alphas Company of NY and a 50% shareholder with his brother, Yanni Alphas, of Alphas Company, Inc. based im Boston, Massachusetts.
Plaintiffs claim they retained defendants’ legal services after being served with a complaint in an underlying action against Alphas Company of NY seeking $11,450.04 for its delinquent contributions to its employees’ union Pension Fund. A letter dated September 20, 2012, from the Pension Fund to Yanni Alphas, theniChief Executive Officer of Alphas Company of NY, notified it of the Pension Fund’s determination that it had ceased contributions to the Pension Fund, thus effecting its withdrawal from the Pension Fund for that year and incurring a liability of $983,579.74 to the Pension Fund. The withdrawal letter further notified Alphas Company of NY that this liability was payable in 44 quarterly installments, that Alphas Company of NY was entitled within 90 days to request the Pension Fund to review its d$termination, and that the final avenue of relief was arbitration. 29 U.S.C. § ·1399(b). The Pension Fund sent a copy of this letter to Smith.”
“Second, while plaintiffs stipulate that the Letter of Engagement is authenticated and admissible for the purpose of determining defendants’ motion, the letter’s execution date does not bar Alphas’s legal malpractice claim against defendants either. The execution date may commence the attorney-client relationship, but is not the single determinative factor in evaluating whether Alphas may claim legal malpractice against defendants. Later dates during the attorney-client relationship determine when his legal malpractice claim accrued: most
significantly, when the malpractice and injury occurred. Johnson ,
v. Proskauer Rose LLP, 129 A.D.3d 5~, 67 (1st Dep’t 2015); Cabrera v. Collazo, 115 A.D.3d 147, 150 (1st Dep’t 2014); Goldman v. Akin Gump Strauss Hauer & Feld LLP, 46 A.D.3d 481, 481 (1st Dep’t 2007). Plaintiffs allege that defendants’ malpractice occurred well into 2013, when Alphas undisputedly was the sole shareholder of Alphas Company of NY. Because there was an attorney-Client relationship between Alphas and defendants based on Alphas’s sole ownership of Alphas Company of NY when the alleged malpractice occurred, Alphas may pursue an individual claim regardless whether he was less than a 100% owner in 2012. Johnson v. Proskauer Rose LLP, 129 A.D.3 at 67; Cabrera v.
Collazo, 115 A.D.3d at 150; Goldman v. Akin Gump Strauss Hauer &
Feld LLP, 46 A.D.3d at 481.
For all these reasons, defendants’ documentary evidence does
not resolve the issue whether Alphas.maintained an attorney client relationship with defendants when plaintiffs’ legal malpractice accrued, as a matter of law, and Alphas at minimum raises a factual issue of such a relationship. Therefore the court denies’ defendants’ motion to dismiss Alphas’s action based on documentary evidence. C.P.L.R. § 3211(a) (1).”