Edelman v Berman 2021 NY Slip Op 04120 Decided on June 30, 2021
Appellate Division, Second Department presents an interesting real estate legal malpractice claim. It illustrates two points. First: No document is absolutely required to show an attorney-client relationship. Second: Violation of a statute or rule, combined with alleged damage can support a legal malpractice claim.
“”On a motion pursuant to CPLR 3211(a)(7) to dismiss for failure to state a cause of action, the court must accept the facts alleged in the complaint as true, accord the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” (Shah v Exxis, Inc., 138 AD3d 970, 971). “Where a court considers evidentiary material in determining a motion to dismiss a complaint pursuant to CPLR 3211(a)(7), but does not convert the motion into one for summary judgment, the criterion becomes whether the plaintiff has a cause of action, not whether the plaintiff has stated one, and unless the movant shows that a material fact as claimed by the plaintiff is not a fact at all and no significant dispute exists regarding the alleged fact, the complaint shall not be dismissed” (Bodden v Kean, 86 AD3d 524, 526).
Applying this standard, the Supreme Court properly granted that branch of the Wisnicki defendants’ motion which was to dismiss the cause of action to recover damages for fraud insofar as asserted against them. “The elements of a cause of action sounding in fraud are a material misrepresentation of an existing fact, made with knowledge of the falsity, an intent to induce reliance thereon, justifiable reliance upon the misrepresentation, and damages” (Mitchell v Diji, 134 AD3d 779, 780 [internal quotation marks omitted]). “When a plaintiff brings a cause of action based upon fraud, ‘the circumstances constituting the wrong shall be stated in detail'” (Sargiss v Magarelli, 12 NY3d 527, 530, quoting CPLR 3016[b]). Here, the complaint did not allege in any detail any misrepresentations that were made to the plaintiff by the Wisnicki defendants or of which the Wisnicki defendants had knowledge.
However, the Supreme Court erred in granting those branches of the Wisnicki defendants’ motion which were to dismiss the causes of action alleging legal malpractice and violation of Real Property Law § 265-a insofar as asserted against them. As to the legal malpractice cause of action, the Wisnicki defendants contend that they had no attorney-client relationship with the plaintiff. An attorney-client relationship may arise even in the absence of a written retainer agreement, and a court must look to the words and actions of the parties to determine whether such a relationship exists (see Tropp v Lumer, 23 AD3d 550, 551). Here, according the plaintiff the benefit of every favorable inference, she sufficiently alleged the existence of an attorney-client relationship (see Hall v Hobbick, 192 AD3d 776; see also Tropp v Lumer, 23 AD3d at 551).
An action for damages or equitable relief for violations of Real Property Law § 265-a may be commenced against, among others, “a person who in any manner solicits, induces, arranges, or causes any equity seller to transfer title . . . to [a] residence in foreclosure” (Real Property Law § 265-a[j]; see id. § 265-a[e]; ). Here, construing the allegations in the light most favorable to the plaintiff, the facts alleged state a cognizable cause of action against the Wisnicki defendants for violation of Real Property Law § 265-a.”