Levy v Brancato 2025 NY Slip Op 34103(U) October 24, 2025 Supreme Court, New York County Docket Number: Index No. 159951/2024 Judge: Mary V. Rosado is the story of a representation, a battle over the retainer agreement, a “walk-off”, a fee arbitration and a de novo litigation.

“On January 6, 2023, Plaintiff retained Defendants to represent her in a guardianship proceeding. Plaintiff alleges she retained Defendants to facilitate settlement. Allegedly, on March 8, 2023, days before a settlement was to be so-ordered, Defendants Laura Brancato, Esq. (“Brancato”) and Lisa Fenech, Esq. (“Fenech”) “walked off [Plaintiffs] case”. Plaintiff provides a litany of alleged misconduct claims and claims she tried several times to terminate the retainer through e-mail and text messages to Brancato. Plaintiff disputed Defendants’ legal fees, and the parties participated in a fee dispute arbitration on September 19, 2024. A decision was issued on September 25, 2024, which Plaintiff disagreed with, so she filed this action seeking a trial de novo. She also alleges breach of contract, seeks declaratory judgment declaring the retainer null and void, and damages for alleged negligent supervision, legal malpractice, and violations of “CPLR 487” which this Court construes to be an alleged violation of Judiciary Law§ 487. Defendants responded with several affirmative defenses and counterclaims. According to Defendants, on January 20, 2023, they sent Plaintiff their standard engagement agreement, and in response Plaintiff asked that the hourly rate be lowered, that Defendants serve as co-counsel to her, and to remove other language. On January 24, 2023, Defendants sent a revised agreement. On February 3, 2023, Plaintiff signed and returned the retainer with an “addendum.” The Amended Answer goes on to detail an allegedly difficult attorney/client relationship. As a result, Defendants claim they sent Plaintiff a consent to change attorney on March 7, 2023 changing Plaintiffs status to prose, which Plaintiff signed. Defendants allege Plaintiff owes $44,308.50 in legal fees, $7,500 of which was covered by the original retainer fee. After fee arbitration, Defendants were awarded $39,877.65 in costs and disbursements, not including the $7,500 retainer fee. Defendants counterclaim for breach of contract, unjust enrichment, quantum meruit, and account stated. Plaintiff moves to dismiss the affirmative defenses and counterclaims and seeks to strike Defendants’ Amended Answers and asks for sanctions. Defendants oppose.”

“Plaintiff’s motion to dismiss is granted in part and denied in part. Plaintiff’s argument that the counterclaims should be dismissed because they were not raised in the fee dispute arbitration is without merit. Plaintiffs argument that the issue of attorneys’ fees for enforcing the retainer and litigating a fee dispute was not raised in the underlying fee dispute arbitration is belied by the terms of the retainer, the notice of client’s right to arbitrate a fee dispute, and Defendants’ filings in the arbitration (see NYSCEF Docs. 60, 67 and 87). These documents state that reasonable attorneys’ fees may be awarded in any dispute over the retainer, and that Defendants would be seeking attorneys’ fees in the arbitration. Plaintiff filed this de nova proceeding which nullified the arbitrator’s award and allows Defendants to again seek attorneys’ fees, just as Plaintiff is entitled to again dispute the amount in legal fees owed to Defendants. Plaintiffs argument that Defendants are not entitled to assert counterclaims because they did not file for a de novo review of the arbitration award is similarly without merit. Plaintiff timely filed for de novo review which nullified the fee dispute arbitration award and raised numerous other causes of action including negligent supervision and legal malpractice. Defendants are entitled to raise counterclaims in defense of Plaintiffs Complaint. Plaintiffs request that Defendants’ Amended Answers be stricken because Defendants reference the arbitrator’s award in the underlying fee dispute is denied. While Plaintiff is correct that 22 NYCRR § 137.8(c) states that at a trial de novo, arbitrators shall not be called as witnesses nor should the arbitration award be admitted in evidence, this matter is not at trial and there is no testimony from any arbitrator, nor has the arbitrator’s award been admitted into evidence. Plaintiffs arguments that the counterclaims for breach of contract, unjust enrichment, quantum meruit and account stated should be dismissed as duplicative of Plaintiffs claim for a de novo review is denied. Defendant’s counterclaims are separate and distinct from Plaintiffs claim for a de novo review – conceptually, a counterclaim cannot be duplicative of a claim asserted by a plaintiff because the claims are asserted by two parties adverse to one another. Plaintiffs argument that the retainer is unenforceable is unavailing at this juncture. Plaintiffs argument that the quantum meruit counterclaim should be dismissed due to Defendants’ professional misconduct is not ripe for review on a CPLR 3211 motion to dismiss, for it requires discovery and factual determinations. Moreover, Plaintiff has failed to meet her heavy burden of establishing the affirmative defenses raised should be dismissed as a matter of law (see, e.g. Granite State Ins. Co. v Transatlantic Reinsurance Co., 132 AD3d 479,481 [1st Dept 2015]). However, the motion is granted to the extent the counterclaim asserted by Fenech and Meltzer Lippe alleging account stated is dismissed. Based on the allegations related to the counterclaim and the parties’ submissions, Plaintiff frequently expressed concerns at what she was being billed for and objected (NYSCEF Doc. 42; see also Brennan Beer Gorman/Architects, LLP v Cappelli Enterprises, Inc., 85 AD3d 482, 483 [1st Dept 2011] [ no account stated claim where client repeatedly objected]). The Court has considered the remainder of Plaintiffs arguments and finds them unavailing.”