Pruss v AmTrust N. Am. Inc.  2022 NY Slip Op 02884 [204 AD3d 620] April 28, 2022 Appellate Division, First Department  seems to be the story of a settlement offer made in good faith, where the offeror only found out later that its principal lacked the authority to make the offer in the first place.  Was the attorney-offeror fraudulent and did the attorney-offeror violate Judiciary Law § 487?  No.

“The negligent misrepresentation claims should be dismissed because there was no privity or privity-like relationship between plaintiffs and these defendants. “Before a duty can be imposed to use reasonable care in imparting correct information, an allegation of negligent misrepresentation must be based on a ‘special relationship’ between the parties . . . [t]he bond so established must be the functional equivalent of contractual privity” (Delcor Labs. v Cosmair, Inc., 169 AD2d 639, 639-640 [1st Dept 1991], lv dismissed 78 NY2d 952 [1991]; see also Sykes v RFD Third Ave. 1 Assoc., LLC, 15 NY3d 370, 372 [2010]). In this case, the court’s conclusion that defendants owed a duty of care to plaintiffs was not supported by legal authority.

Moreover, an agent for a disclosed principal “will not be personally bound unless there is clear and explicit evidence of the agent’s intention to substitute or superadd his personal liability for, or to, that of his principal” (News Am. Mktg., Inc. v Lepage Bakeries, Inc., 16 AD3d 146, 147 [1st Dept 2005], quoting Savoy Record Co. v Cardinal Export Corp., 15 NY2d 1, 4 [1964]). That did not occur here, where defendants conveyed the settlement offer to plaintiffs and the court in accordance with the instructions of their principal, defendant AmTrust North America, Inc. (AmTrust). Defendants’ statements that AmTrust had conferred them with authority to settle the case for $5 million were accurate, even if the validity of AmTrust’s underlying statements was not.

Plaintiffs’ claims for violation of Judiciary Law § 487 also fail. A violation of this provision “requires a showing of ‘egregious conduct or a chronic and extreme pattern of behavior’ on the part of the defendant attorneys that caused damages” (Facebook, Inc. v DLA Piper LLP [US], 134 AD3d 610, 615 [1st Dept 2015], lv denied 28 NY3d 903 [2016]). There are no such allegations here, and Mr. Kuhn, AmTrust’s claims adjuster, has acknowledged that he made a mistake in extending settlement authority to these defendants. Defendants were entitled to rely upon the direction given to them by AmTrust and had no independent legal duty to plaintiffs to confirm that authority with the conservator. Further, a fair review of Pavloff’s statements at the August 2017 settlement hearing reveal that while evasive they were not untruthful, and in any event do not support a finding of egregious [*2]conduct that would be sufficient to uphold the claim.”

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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.