Nexus Captial Invs, LLC v. Fleischmann, 2022 NY Slip Op 30808(U) March 10, 2022 Supreme Court, Kings County Docket Number: Index No. 512222/2021 Judge: Leon Ruchelsman is an example of what to do when the statute of limitation is approaching yet the underlying case has not concluded.  Here, “According to the complaint, on October 4, 2018 the plaintiff
loaned $5,200,000 to an entity called NY Ave Lofts LLC. The defendant David Fleischmann Esq. drafted the loan documents on behalf of the plaintiff. In connection with the loan the
borrower executed a mortgage in the amount of the loan against 132 Walnut Street, 25.-31 New York Avenue and 13-23 New York Avenue, all located in Newark New Jersey. Further, the defendant also drafted an Assignment of Leases and Rents and recorded a UCC-1 against the above named mortgaged properties. In addition, Jacob Tauber executed a guaranty concerning the outstanding loan. The borrower failed to make all the required payments and defaulted in April 2019. To avoid foreclosure of the properties Tauber requested the ability to borrow money from TBG Funding LLC to pay off the debt. Further, TBG agreed to lend additional funds, subordinate to the first loan, in efforts to develop the properties. Thus, a two tiered loan by TBG  was executed wherein the first mortgage remained a lien on the property and TBG loaned the borrower $3,000,000 as a paydown and an additional $2,470,000  in the form of a new note and mortgage which was intended to be subordinate to plaintiff’s remaining lien. Amended loan documents including an amended note and mortgage were executed reflecting a new loan balance of $2,470,000. Further, as noted, the plaintiff agreed that its mortgage would be subordinated to TBG’ s loan. According to the amended complaint ”upon receipt of the partial Payoff, Defendants, as Lender’s counsel, were  required to immediately and simultaneously satisfy the First Mortgage and record the Amended Mortgage. This arrangement would have been equivalent to a subordination agreement, providing TBG priority lien while maintaining the Lender’ s lien (as reduced by the payment)” (see, Amended Complaint, lZ2) . The amended complaint alleges the amended loan documents were never recorded. ”

“However, a dismissal of the action could forever forestall the ability to assert any malpractice claim since by the time any claim could ripen the statute of limitations could pass. In
Collins v. Felder, 251 F.Supp3d 634 [S.D.N.Y. 2017] the court was faced with this exact dilemma, balancing the retention of the action to preserve any potential claims and allowing discovery to proceed on presently unripe claims. The court denied the motion to dismiss the complaint on ripeness grounds but stc3.yed any further proceedings until a final judgement on appeal was rendered. The appeal was the basis the malpractice claim was unripe. This has the effect of preserving the allegations of malpractice but staying the burdens of discovery ±n case they prove to be unwarranted.  Therefore, the_ court hereby denies the motion seeking to dismiss the _action, however, all discovery is stayed pending the outcome of the foreclosure sale. The motion is granted to this extent. “

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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.