A commonly recurring theme in legal malpractice is the application of the privity requirement. That requirement basically (always with some exceptions) prohibits legal malpractice claims against an attorney with whom the Plaintiff does not have privity of contract. One common subset arises when the attorney represents an entity, and where the individual members or shareholders have a dispute and thought the attorney represented them as well.
Blank v Petrosyants 2023 NY Slip Op 33932(U) November 1, 2023 Supreme Court, Kings County Docket Number: Index No. 517568/19 Judge: Leon Ruchelsman is an example.
“In 2013 the plaintiffs invested sums of money with the defendants· to open a restaurant and catering hall in Queens County. The plaintiffs allege they paid money and entered into a shareholder agreement. Pursuant to the agreement the defendant
Zhan Petrosyants was a sixty percent owner. and the plaintiffs :Shubaderov and Egorov were each twenty percent owners. The lawsuit alleges the defendants diverted the funds to other sources depriving them of any return upon their investments.”
” On January 30:, 2014 the defendant Zhan Petrosyants entered into a retainer agreement with Akiva Ofshtein. There is no basis to question the authenticity of the agreement and thus serves as prima facie evidence that only Petrosyants hired Ofshtein. Further, the terms bf the agreement, and plaintiff’s questions regarding some of its curious provisions, 90 not raise any questions whether the plaintiffs were also included as parties to the agreement. Thus, there is no agreement wherein Ofshtein.
agreed to represent the plaintiffs.”
” The only evidence supporting the existence of any attorney client relationship is
the subjective beliefs of the plaintiffs. Those beliefs fail to raise any questions about the existence of such relationship. Therefore, the motion seeking summary judgement dismissing all claims against Ofshtein is granted.”