There is something about New York real estate and lawyers that generates legal malpractice claims, and in this case, a Judiciary Law § 487 case.  In Knopf v Esposito  2019 NY Slip Op 33468(U) November 27, 2019 Supreme Court, New York County Docket Number: 150315/2019 Judge: Gerald Lebovits.

This decision bears on a simple evidentiary issue, whether an unsigned deposition transcript may be considered on a motion.  However, the fact pattern, which includes a claim that an Appellate Division  special Master participated in a deceitful telephone call is rather amazing.

“In 2006, the Knopfs made two multi-million-dollar loans to Pursuit to purchase several apartments in New York County, one of which is a penthouse condominium unit (or PHC). The
Knopfs made these loans in exchange for Pursuit’s commitment to execute mortgage liens on the property in the Knopfs’ favor. Pursuit failed to repay the loans or to execute the mortgage liens.
The Knopfs sued Pursuit and Sanford for breach of contract in Supreme Court, New York County. In December 2014, the Appellate Division, First Judicial Department, granted summary judgment in the Knopfs’ favor on their breach-of-contract claim. The First Department left it to Supreme Court to determine the Knopfs’ damages. (See Knop.fv, 123 AD3d 521, 521 (1st Dept 2014].)

In October 2015, First Department Justice John Sweeny, Jr., ordered that any proceeds from the sale of the PHC be put into escrow. Sanford moved to vacate this escrow order. In
December 2015, a full panel of the First Department issued an order denying Sanford’s motion to vacate this escrow requirement. (See Index No. 113227/2019, NYSCEF No. 164, at Attachments A and C.)

Two weeks after the Court denied Sanford’s motion to vacate-while the Knopfs and Sanford were litigating the amount of the Knopfs’ damages before a judicial hearing officerSanford retained a new attorney (Frank M. Esposito, Esq.). Esposito is a transactional lawyer, not a litigator. But Esposito’s wife (Melissa Ringel, Esq.) was then a First Department special
master and a former Principal Appellate Law Clerk for three years to then-Justice James McGuire.

The same day that Sanford retained Esposito (January 11, 2016), he directed other attorneys representing him (Nathaniel H. Akerman, Esq., and Edward S. Feldman, Esq.) to call the First Department-without counsel for the Knopfs present on the call or aware that the call had been made-regarding the meaning of the Court’s December 2015 Order, and in particular whether the October 2015 escrow order remained in place. Sanford did not wish to sell the PH C
with an escrow requirement in place, and Sanford’s buyer was reluctant to close the sale without greater clarity as to title.

Akerman and Feldman called the Court the next day, January 12, and spoke for several minutes with Ringel. Both Akerman and Feldman later gave deposition testimony in a related
federal action that they called the general line for the First Department Clerk’s Office and were transferred by the Clerk’s Office to Ringel. The Court’s telephone records, however, reflect that Akerman placed the call directly to Ringel.2 Ringel told Akerman and Feldman that the October 2015 escrow order had been vacated by a November 2015 First Department order-entered on a separate motion-and therefore that the Court’s December 2015 denial of the motion to vacate the October 2015 order had no effect.
Akerman and Feldman each prepared memorandums memorializing their call with Ringel and provided their memos to Sanford, on Pursuit’s behalf, and to the prospective purchaser of the PHC. These memos allowed the PHC sale to close on February 1, 2016.

On February 8, one week after the sale closed, a judicial hearing officer found Pursuit liable to the Knopfs for $8,336,488 in damages. 3 (See Index No. 113227/2009, NYSCEF No. 164, at 5 n 12.)

When the Knopfs became aware that Sanford had sold the PHC without escrowing the proceeds, they immediately brought a motion in the First Department, seeking among other things to have the proceeds returned to escrow. On February 25, 2016, now-retired First Department Justice Karla Moskowitz ordered that the “[m]oney remaining as of today at 3:45 pm” from the PHC sale “shall be placed in escrow as had been directed by Justice Sweeny in his 10/22115 interim order, vacatur of which was denied by this Court’s 12/29/2015 Order.” (Index No. 113227/2009, NYSCEF No. 164, at 5 n 13 [quoting order].) “

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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…

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.