“But for” proximate cause is central to legal malpractice claims. In Bono v Stim & Warmuth, P.C. 2023 NY Slip Op 02099 Decided on April 26, 2023 Appellate Division, Second Department the claim was that “but for” the failure to plead “usury” as an affirmative defense, the underlying litigation would have been won. The Appellate Division disagreed.

“The defendants represented the plaintiffs for a period of approximately six months in a commercial mortgage foreclosure action (hereinafter the underlying action). After the defendants were granted leave to withdraw as counsel and the plaintiffs retained new counsel, the plaintiffs commenced this action to recover damages for legal malpractice, alleging, inter alia, that the defendants negligently failed to assert criminal usury as an affirmative defense in the underlying action. Thereafter, the defendants moved pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint. In an order dated February 24, 2020, the Supreme Court, among other things, granted the defendants’ motion. The plaintiffs appeal.”

“The claim of legal malpractice was predicated on the plaintiffs’ allegations that the court would have ruled in their favor in the underlying action had the defendants asserted the affirmative defense of criminal usury. However, the evidence indisputably demonstrated that the annual interest rate imposed under the loan documents was 6.5%, and, therefore, was not criminally usurious (see Penal Law § 190.40; Paycation Travel, Inc. v Global Merchant Cash, Inc., 192 AD3d 1040, 1041). Moreover, contrary to the plaintiffs’ contention, “the defense of usury does not apply where . . . the terms of the . . . note impose a rate of interest in excess of the statutory maximum only after default or maturity” (Torto Note Member, LLC v Babad, 192 AD3d 843, 845 [internal quotation marks omitted]; see Kraus v Mendelsohn, 97 AD3d 641, 641).”