457 Warburton Ave, LLC v Monna Lissa, LLC 2024 NY Slip Op 30423(U) February 7, 2024
Supreme Court, New York County Docket Number: Index No. 651358/2020 Judge: Louis L. Nock is quite unusual, and discusses a unique application of the statute of limitations to a legal malpractice (“attorney malpractice”) claim.

“This matter was initially brought on February 28, 2020, by plaintiffs’ motion for
summary judgment in lieu of complaint (NYSCEF Doc. Nos. 1, 2). In a decision and order dated December 7, 2020, the court denied the motion, on the grounds that plaintiff was not suing on a judgment or an instrument for the payment of money only (NYSCEF Doc. No. 27). The court then directed plaintiffs to file a formal complaint against defendants (id. at 2). Plaintiffs did so, prompting an answer and counterclaims from defendants. Relevant to the instant motion practice, defendants allege as a sixth affirmative defense that Monna Lisa is entitled to a set-off against plaintiffs. In addition, defendants allege that plaintiff Paul Sabaj, who acted as attorney for all of the parties in forming Monna Lissa and then plaintiff 457 Warburton Ave, LLC (“457”),1 committed malpractice through unlawful self-dealing, and failing to advise defendants Bindela and Pagliuca of their right to independent counsel before setting up 457. Defendants further assert that Sabaj is obligated to indemnify them for any of 457’s damages. Finally, defendants claim that Bindela, his company, and Pagliuca did substantial work renovating the property located at 457 Warburton Avenue, Hastings on Hudson, New York, for which they have not been compensated, and from which plaintiffs profited by the increased sale price garnered for the property.”

“Plaintiffs argue that this claim is time-barred, as Sabaj was terminated as of April 25,
2017, and a claim for attorney malpractice has a three-year statute of limitations (CPLR 214[6]), which expired on April 25, 2020.2 The COVID-19 toll in effect from March 20, 2020 (9 NYCRR 8.202.8), through November 3, 2020 (9 NYCRR 8.202.72), extended that time through December 9, 2020. Defendants did not assert their counterclaim for malpractice until January 12, 2021 – after the December 9, 2020, malpractice claim statute of limitations deadline had passed. Thus, Sabaj is correct in his assertion that any malpractice counterclaim against him in this lawsuit is time-barred.

The court observes two factors that might have saved defendants’ malpractice claim from the foregoing statute of limitations consequences: (i) the motion for summary judgment in lieu of complaint, which was the functional equivalent of a complaint, was filed February 28, 2020, within the defendants’ malpractice claim limitations period (ending December 9, 2020); and (ii) even though defendants’ malpractice claim would ordinarily have been barred by January 12, 2021 (the date their counterclaim was filed), as long as it was viable when the action commenced (February 28, 2020), it would have been deemed timely on January 12, 2021, by virtue of CPLR 203 (d) which provides that a “defense or counterclaim is not barred if it was not barred at the time the claims asserted in the complaint were interposed.” This would have been a way to reach
a conclusion that the January 12, 2021, malpractice counterclaim was timely even though, absent its nature as a counterclaim, it would have expired naturally, as a claim-in-chief, on December 9, However, defendants are unable to avail themselves of this procedural advantage for the following reason.

CPLR 3213 provides that “[i]f the motion [for summary judgment in lieu of complaint] is
denied, the moving and answering papers shall be deemed the complaint and answer, unless the court orders otherwise” (emphasis added). In this case, this court’s decision and order denying the motion (NYSCEF Doc. No. 27) expressly “order[ed] otherwise” (CPLR 3213) by directing plaintiffs to file a separate complaint (NYSCEF Doc. No. 27 at 2). The plaintiffs, in fact, did so on January 7, 2021, prompting defendants’ answer with counterclaims (including a malpractice counterclaim) on January 12, 2021. But in this instance, where this court did not convert the motion into a plenary action by deeming the motion papers as a complaint; but rather, directed the filing of a plenary complaint, defendants cannot take advantage of CPLR 203 (d)’s relation back provision because, as explained in the Practice Commentaries on CPLR 3213, the motion’s denial with direction to file a complaint effectively nullifies the initiatory effect of the motion
papers, and the complaint is viewed as a new initiatory filing bringing to bear all the risks of statute of limitations analysis anew. As the Practice Commentaries make clear, once a court opts for the filing of a plenary complaint as opposed to converting the motion to complaint status, any claim which would have naturally expired as of the time of the denial of the motion would remain so within the procedural context of the new complaint (see, David D. Siegel, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR C3213:11 [“Effect of Denial; Conversion to Action; Dismissal”], C3213:19 [“Statute of Limitations Problems”] [2005 ed]). Thus, any relation-back benefit available to the defendants while the motion was pending, as such, pursuant to CPLR 203 (d), was lost once the motion was denied on December 7, 2020, and a new initiatory pleading by way of complaint was ordered to be filed. Although defendants still
had two days – till December 9, 2020 – to commence their own action for malpractice against Sabaj, they did not, and waited to pursue the claim by way of counterclaim in response to the January 7, 2021, complaint. The malpractice claim was stale by that point in time.3 Thus, the counterclaim for legal malpractice is dismissed.”

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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.