A fair segment of legal malpractice dismissal are determined upon the assertion that the subject “error” was actually a strategic choice which went sour.  In general, a good legal malpractice case cannot be based upon an “error in judgment” or a “strategic trial decision.”  The underlying understanding is that trial and litigation decisions may often be more art than science.

In Smith, Gambrell & Russell, LLP v Telecommunications Sys., Inc.  2017 NY Slip Op 07954 Decided on November 14, 2017  Appellate Division, First Department we see the relatively rare case in which the AD points to actual reasoning in finding a “strategic decision” rather than simply deciding that a sour outcome was strategy without any supporting language.

“On appeal, defendant argues that plaintiff’s filing of a sanctions motion, instead of a motion for attorneys’ fees as the prevailing party pursuant to 35 USC § 285, constitutes malpractice. We may entertain this new legal argument because it appears on the face of the record, involves no new facts, and is determinative (Vanship Holdings Ltd. v Energy Infrastructure Acquisition Corp., 65 AD3d 405, 408 [1st Dept 2009]). However, the argument does not avail defendant.

The record shows that plaintiff had contemplated filing a motion pursuant to 35 USC § 285 and decided against it. The statute provides that the court may award attorneys’ fees to the prevailing party “in exceptional cases” (see Octane Fitness, LLC v Icon Health & Fitness, Inc., __ US __, __, 134 S Ct 1749, 1756 [2014]). Plaintiff advised defendant that it would be a “stretch” to argue prevailing party under § 285. Thus, defendant’s theory that plaintiff breached a duty of care to it by choosing to apply for attorneys’ fees via a sanctions motion instead of a motion under § 285 amounts to no more than an allegation that plaintiff made an error in judgment, which does not state a cause of action for malpractice (see Rosner v Paley, 65 NY2d 736, 738 [1985]; Sitomer v Goldweber Epstein, LLP, 139 AD3d 642 [1st Dept 2016], lv denied 28 NY3d 906 [2016]).”

We admit to being a little confused.  A Judiciary Law § 487 claim seeks damages because of attorney deceit, which generally must happen in a litigation setting.  Must the claim be brought in the underlying setting or later, in a separate action.  The answer seems to reside in whether the 487 claim merely seeks to vacate the underlying claim.  But what happens when the client loses the underlying case, has the complaint dismissed, or (as a defendant) has a judgment entered.  Cannot the client then sue for deceit?

In a cryptic decision, DeMartino v Lomonaco  2017 NY Slip Op 07706 Decided on November 8, 2017 Appellate Division, Second Department says, no.

“The Supreme Court also properly granted that branch of the moving defendants’ motion which was for summary judgment dismissing the causes of action alleging fraud, aiding and abetting fraud, violation of Judiciary Law § 487, and prima facie tort insofar as asserted against them. Generally, a party who has lost an action as a result of alleged fraud or false testimony cannot collaterally attack the judgment in a separate action against the party who adduced the false evidence, and the plaintiff’s remedy lies exclusively in moving to vacate the judgment (see North Shore Envtl. Solutions, Inc. v Glass, 17 AD3d 427, 427-428; Retina Assoc. of Long Is. v Rosberger, 299 AD2d 533; New York City Tr. Auth. v Morris J. Eisen, P.C., 276 AD2d 78, 87; Yalkowsky v Century Apts. Assoc., 215 AD2d 214, 215). Under an exception to that rule, a separate action may be commenced where the alleged perjury or fraud in the underlying action was “merely a means to the accomplishment of a larger fraudulent scheme” (Newin Corp. v Hartford Acc. & Indem. Co., 37 NY2d 211, 217) which was “greater in scope than the issues determined in the prior proceeding” (Retina Assoc. of Long Is. v Rosberger, 299 AD2d at 533 [internal quotation marks omitted]).

Here, the moving defendants established their prima facie entitlement to summary judgment dismissing the causes of action alleging fraud, aiding and abetting fraud, violation of Judiciary Law § 487, and prima facie tort insofar as asserted against them by demonstrating that the plaintiffs are merely attempting to collaterally attack an order issued in the underlying action. In opposition, the plaintiffs only raised conclusory and unsubstantiated allegations that the moving defendants’ fraud in the underlying action was “merely a means to the accomplishment of a larger fraudulent scheme” (Newin Corp. v Hartford Acc. & Indem. Co., 37 NY2d at 217).”

Dismissal of a Legal Malpractice claim was denied (and affirmed) in Eurotech Constr. Corp. v Fischetti & Pesce, LLP  2017 NY Slip Op 07780  Decided on November 9, 2017  Appellate Division, First Department.  The claim arose over whether it was the attorney’s obligation to deal with client insurance for the underlying claim.

“The complaint alleges that defendant failed to ensure that plaintiff gave timely notice to its excess carrier that the primary insurer’s limits were likely to be exhausted in connection with the underlying personal injury claim. Conceding the general principle that a law firm may have an obligation to investigate insurance coverage (see Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34, 40-41 [2d Dept 2006]), defendant argues that it should not bear that burden in this case, because plaintiff had been advised by its insurer’s third-party administrator to notify its excess carrier of the claim and had not done so. However, as the motion court observed, the issue is not what plaintiff knew but whether its attorneys committed malpractice by not providing timely information obtained from the deposition testimony or bills of particular in the underlying action. Resolution of that issue depends on facts not yet developed (see id. at 41).”

Legal malpractice and CPLR 3211(a)(7) motions are an institutional problem.  In our view, (as in the dissent’s view here) judges give unwarranted extra scrutiny to legal malpractice complaints, and grant 3211(a)(7) motions statistically in greater volume then they do to other types of cases.  Our view is that it is an institutional problem because of the human nature of lawyers judging lawyers.  There is interesting support for this proposition in both the Law Review literature as well as in Psychology experimental studies.

Here is the debate, as set forth in MidH-Hudson Val. Fed. Credit Union v Quartararo & Lois, LLC  2017 NY Slip Op 07916  Decided on November 9, 2017  Appellate Division, Third Department.

For the majority:  “A legal malpractice claim requires that the plaintiff show that “the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession which results in actual damages to a plaintiff, and that the plaintiff would have succeeded on the merits of the underlying action ‘but for’ the attorney’s negligence” (AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434 [2007] [citations omitted]; see Hinsdale v Weiermiller, 126 AD3d 1103, 1104 [2015]). The amended complaint alleged that, but for defendants’ failure to provide timely and competent legal services, plaintiff would have succeeded in the underlying debt collection and mortgage foreclosure actions. The amended complaint further alleged that “had [defendants] not failed to advise the cases in a timely and competent manner . . ., [plaintiff] would not have incurred a loss in time and value in the debt on the collection and foreclosure cases assigned to defendant[s].” Other than these vague and conclusory allegations, however, plaintiff failed to plead any specific facts, which, if accepted as true, would establish a legal malpractice claim. Absent from the amended complaint is any mention of an instance of deficient representation or any example of erroneous advice by defendants. Merely alleging the elements of a legal malpractice claim in a general fashion, without more, does not satisfy the liberal pleading standard of CPLR 3211. Furthermore, while a recitation of the elements of a cause of action may meet that component of CPLR 3013 requiring that the statements in a pleading provide notice of “the material elements of a cause of action,” the statute also requires that the pleading’s statements be “sufficiently particular to give the court and parties notice of the transactions, occurrences or series of transactions or occurrences, intended to be proved” (CPLR 3013 [emphasis added]; cf. Matter of Garraway v Fischer, 106 AD3d 1301, 1301 [2013], lv denied 21 NY3d 864 [2013]; Eklund v Pinkey, 27 AD3d 878, 879 [2006]).

The statements in the amended complaint fail in this regard in that they do not allege a single transaction where defendants were retained to provide legal services or a single occurrence of negligent legal representation forming the basis of the legal malpractice claim, let alone the specific underlying foreclosure action or actions in which defendants allegedly committed legal malpractice. Other than stating that defendants represented plaintiff in foreclosure actions, the amended complaint does not allege, and, more critically, it cannot reasonably be inferred from such pleading, what defendants allegedly did or did not do in a negligent fashion. The amended complaint is not just sparse on factual details — rather, it is wholly devoid of them ^[FN2]. Given the [*2]absence of detailed facts, the legal malpractice cause of action should have been dismissed (see Janker v Silver, Forrester & Lesser, P.C., 135 AD3d 908, 910 [2016]; Rodriguez v Jacoby & Meyers, LLP, 126 AD3d at 1185-1186; Kreamer v Town of Oxford, 96 AD3d 1128, 1128 [2012]; compare Soule v Lozada, 232 AD2d 825, 825 [1996]).”

For the minority: “We concur with the majority that plaintiff’s cause of action for fraud must be dismissed, as it was not pleaded with the high level of specificity and detail required by CPLR 3016 (b). However, fraud is one of just a few causes of action singled out in the CPLR for such heightened standards of particularity in pleading (see CPLR 3016). In contrast, the standards of specificity for legal malpractice, like most other causes of action, are governed by principles of notice pleading, which “are designed to focus attention on whether the pleader has a cause of action rather than on whether he [or she] has properly stated one” (Rovello v Orofino Realty Co., 40 NY2d 633, 636 [1976] [internal quotation marks and citations omitted]; accord Gagnon v City of Saratoga Springs, 14 AD3d 845, 846 [2005]). The allegations of a complaint generally need not be set forth in detail; it is sufficient if the parties are put on notice of the underlying transactions or occurrences, and the material elements of the cause of action are stated (see CPLR 3013). Here, the allegations of legal malpractice in plaintiff’s complaint — although lacking detail — state factual allegations that provide the degree of notice necessary to satisfy this generous standard. We therefore respectfully dissent from the majority as to that cause of action.

The standard to be applied upon a motion to dismiss a pleading for failure to state a cause of action is well established, and was both properly described and applied by Supreme Court. A court considering such a motion must construe the pleading liberally, “accept the facts as alleged in the [pleading] as true, accord [the] plaintiff[] the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” (Leon v Martinez, 84 NY2d 83, 87-88 [1994]; accord Connaughton v Chipotle Mexican Grill, Inc., 29 NY3d 137, 141 [2017]; Rushaid v Pictet & Cie, 28 NY3d 316, 327 [2016]). The complaint “is deemed to allege whatever can be implied from its statements by fair and reasonable intendment” (Foley v D’Agostino, 21 AD2d 60, 65 [1964] [internal quotation marks and citations omitted]). A complaint should not be dismissed solely because it is poorly or inartfully pleaded; rather, “in order to succeed on the motion, the defendant must convince the court that nothing the plaintiff can reasonably be expected to prove would help; that the plaintiff just doesn’t have a claim” (Siegel, NY Prac § 265 [5th ed 2017]).

These principles apply to allegations of legal malpractice (see Leon v Martinez, 84 NY2d at 87-88; New York State Workers’ Compensation Bd. v Program Risk Mgt., Inc., 150 AD3d 1589, 1594 [2017]; Rodriguez v Jacoby & Meyers, LLP, 126 AD3d 1183, 1185 [2015], lv denied 25 NY3d 912 [2015]; Snyder v Brown Chiari, LLP, 116 AD3d 1116, 1117 [2014]; Alaimo v McGeorge, 69 AD3d 1032, 1034 [2010]). The cases relied upon by the majority should not be misunderstood to require a higher standard of detail and specificity for legal malpractice claims than those imposed upon other causes of action by the familiar and fundamental standards of notice pleading (see e.g. 12 Baker Hill Rd., Inc. v Miranti, 130 AD3d 1425, 1426 [2015] [a complaint alleging breach of contract need not plead the contract’s terms verbatim nor specify which provision of the contract was breached]). No such distinction exists, nor should it.”

Whether an attorney departed from good practice sometimes turns on whether the attorney actually had an obligation to deal with a particular issue.  Whether the attorney was supposed to deal with that particular issue turns on the scope of the agreement between the attorney and the client.  Attorneys are required to do adequate work when they are hired to handle a particular situation.  If they are not so tasked, then they are not required to do anything at all.

As an example, in Superior Tech. Solutions, Inc. v Rozenholc 2017 NY Slip Op 01136 [147 AD3d 485] February 10, 2017 Appellate Division, First Department it seems the attorneys were not required to help renew a lease when their agreement to work was much more limited.

“Defendant has established that the malpractice claim fails for multiple reasons, and plaintiffs have failed to raise any triable issues (Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; Sabalza v Salgado, 85 AD3d 436, 437 [1st Dept 2011]). There is no support for plaintiffs’ contention that defendant had a duty to renew the lease on their behalf, or to advise them of the need to do so (see Kaminsky v Herrick, Feinstein LLP, 59 AD3d 1, 9 [1st Dept 2008], lv denied 12 NY3d 715 [2009]). The record demonstrates that defendant’s representation was limited to litigating and negotiating a settlement with respect to the Yellowstone action, which defendant brought on plaintiffs’ behalf, and that the scope of his services was not transactional. Defendant was not actively representing plaintiffs at the time the lease was negotiated or when the renewal option was to be exercised.

Defendant has also demonstrated that it cannot be shown that any alleged negligence by him was the proximate cause of plaintiffs’ damages (Stolmeier v Fields, 280 AD2d 342, 343 [1st Dept 2001], lv denied 96 NY2d 714 [2001]). Plaintiff Lee’s testimony establishes that he knew that notice for the renewal had to be in writing and sent by certified or registered mail to the landlord, and his own affidavits reflect his knowledge that the lease ran until January 31, 2011 with the option to renew.

In fact, Lee had renewed a prior lease, identical to the lease at issue, years before he even retained defendant to represent him in the Yellowstone litigation.”

Legal and professional malpractice cases engender two views.  One is the transactional view which we often discuss. We talk about the statute of limitations, the specificity of allegations and privity.  The second view is that of the victims of poor professional work.  Their story is often left out of the analysis.  In Herrmann v CohnReznick LLP  2017 NY Slip Op 07688  Decided on November 2, 2017  Appellate Division, First Department we see the following:  “In July of 2005, the late Edward Herrmann, a well-known actor, and his wife Star Herrmann entered into an engagement letter agreement with Frederic Kantor and Company, P.C., a predecessor firm of defendant CohnReznick LLP, to provide them and their company Baloo Enterprises Ltd. with “bookkeeping and related business management services.” Baloo is a corporation that was formed by Mr. Herrmann to lease his services as an actor to third parties, among other things.

Through this action, plaintiffs claim that defendants mismanaged their account over a nine-year period from 2005 through 2014 by, among other things, (1) failing to pay their expenses in a timely manner; (2) negligently and improperly preparing their tax returns such that they failed to take the proper deductions and owed substantial back taxes, interest and penalties; and (3) making poor investments that left them with no meaningful savings or money to pay for their daughter Emma’s college tuition. The second amended complaint alleges causes of action for (1) professional malpractice (tax); professional negligence (other services), (3) breach of fiduciary duty, (4) accounting, and (5) breach of contract for purportedly charging excessive fees.”

They lose the case for lack of specificity in pleading.

“The IAS Court’s conclusion that the allegations of the second amended complaint failed for a lack of specificity is amply supported. Plaintiffs’ allegations were not sufficient to apprise defendants of the “transactions, occurrences, or series of transactions and occurrences” at issue, particularly in light of the 73,000 pages of pre-complaint discovery that plaintiffs received and their admission that they now have all of the relevant tax returns in their possession (CPLR 3013).

The second amended complaint and other documents submitted by plaintiffs failed to specify, among other things, the tax years and specific tax returns that were purportedly prepared improperly and the specific deductions that were not taken. Nor did plaintiffs identify the credit cards or accounts at issue, what the balances were, how many months the balances remained unpaid or the specific amounts of penalties and interest that plaintiffs incurred. The allegations in support of plaintiffs’ breach of contract claim for excessive fees were also insufficient in that they did not set forth the fees that were charged and when, which fees were excessive and the proper amount that the fees should have been.

Plaintiffs’ claims for breach of fiduciary duty and an accounting, which are subject to a heightened pleading standard set forth in CPLR 3016(b), also fail (Caprer v Nussbaum, 36 AD3d 176, 194 [2d Dept 2006] [“As a general rule, accountants are not fiduciaries as to their clients except where the accountants are directly involved in managing the client’s investments”]).

Compounding the pleading deficiencies, the vagueness of plaintiffs’ allegations prevented the IAS Court from ruling on defendants’ statute of limitation defense. It is noted that the IAS [*2]Court dismissed the bulk of the claims without prejudice (with the exception of the professional negligence claim asserted on behalf of Emma Herrmann), and that plaintiffs will be afforded the opportunity to replead their claims a third time. There is no reason to disturb the court’s order.”

Cohen v Sive, Paget & Riesel, P.C.   2017 NY Slip Op 32295(U)   October 27, 2017 Supreme Court,   New York County Docket Number: 154650/2013   Judge: Jennifer G. Schecter applies black-letter law to a shaken foundation legal malpractice case, leaving the legal malpractice claims standing, and the ancillary causes of action dismissed.

“In 2004, the Cohens’ neighbors–the Habers–did extensive excavation on their property as they planned to construct a house with two basement levels (Memorandum in Opposition [Opp] at 1). In August 2004, during the early stages of the excavation, the Cohens became concerned with vibrations and possible damage to their home and contacted the Habers’ contractor and the New York City Department of Buildings (DOB). ”

“On September 30, 2004, DOB inspectors determined that there was damage to the Cohens’ property that was caused by the Habers’ work (Opp, Exs 4-5) .

Days later, on October 4, 2004, plaintiffs retained SPR to represent them on issues related to the excavation, including the damage to their home (Supp at 9; Opp at 2) . Steven Barshov, a vice-president of SPR, was the Cohens contact at the firm (Supp at 5).

Over a year later, in December 2005, the Cohens made a claim with their insurance company. In a January 2006 letter, which was sent to plaintiffs and SPR, the Cohens’ insurer denied coverage because the Cohens were aware of damage to their home as early as September 21, 2004, yet failed to give “prompt notice” under the policy (Opp, Ex 8). ”

“To recover for legal malpractice, a plaintiff must demonstrate that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession and that the attorney’s breach of this duty proximately caused actual and ascertainable damages (Darby & Darby, P.C. v VSI Inern., Inc., 95 NY2d 308 [2000]; Soni v Pryor, 139 AD3d 841, 842 [2d Dept 2016]; Global Bus. Inst. v Rivkin Radler LLP, 101 AD3d 651, 651 [1st Dept 2012]; Sabalaza v Salgado, 85 AD3d 436, 437 [1st Dept 2011]). SPR has not met its heavy burden of establishing entitlement to summary judgment here. It failed to demonstrate that had plaintiffs submitted an insurance claim at the time SPR was retained, coverage would have definitively been denied (see Soni, 139 AD3d at 844 [affirming denial of summary judgment to attorneys who allegedly failed to advise their clients about the availability of insurance as they did not show that it would be “impossible” for plaintiffs to establish that had they given notice to their insurer, it would have complied with the policy’s condition precedent that notice be given “as soon as practicable”]) . 2 Significantly, in disclaiming coverage, the Cohens’ insurer explained that the Cohens were on notice of damage as of September 21, 2004, which is only two weeks before SPR was retained. Because SPR has not demonstrated that, as a matter of law, notice would have been untimely or that any potential negligence on its part could not have been the proximate cause of the plaintiffs’ loss of coverage, its motion for summary judgment is denied. “

A stipulation which stated that the statute of limitations would not be asserted failed to stop the assertion of the statute of limitations in Dineen v Pratt  2017 NY Slip Op 07590  Decided on November 1, 2017  Appellate Division, Second Department the first half of which we reported on yesterday.

“In a consolidated action and proceedings, inter alia, to recover damages for legal malpractice and to compel a trust accounting, the plaintiff appeals from an order of the Supreme Court, Westchester County (Jamieson, J.), dated January 5, 2017, which granted the motion of the defendant Barbara J. Pratt to dismiss so much of the consolidated action and proceedings as sought to compel an accounting of a testamentary trust created under the last will and testament of John F. Wilkens and to remove her as the trustee of that testamentary trust, and granted the motion of the defendant Randall Pratt for summary judgment dismissing the cause of action to recover damages for legal malpractice.

ORDERED that the order is affirmed, with one bill of costs to the respondents appearing separately and filing separate briefs.”

“Regarding the motion of the defendant Randall Pratt, “[a] defendant moving for summary judgment in a legal malpractice action on the ground that it is untimely must make a prima [*2]facie showing that the malpractice action was commenced more than three years after the date on which the cause of action accrued” (Farage v Ehrenberg, 124 AD3d 159, 164). “If the defendant does make such a prima facie showing, the burden then shifts to the plaintiff to raise triable issues of fact” (id. at 165). Here, Dineen alleged that Pratt performed legal services which were completed as of September 2, 2011. Pratt satisfied his initial burden of demonstrating, prima facie, that the cause of action alleging legal malpractice against him was untimely, as this action and consolidated proceedings was commenced in July 2015. In opposition, Dineen failed to raise a triable issue of fact (see Tantleff v Kestenbaum & Mark, 131 AD3d 955). Contrary to Dineen’s contention, the parties’ stipulation in a prior shareholder’s derivative action that the statute of limitations would not be asserted as a defense to any claims or counterclaims was limited to claims or counterclaims asserted in the Surrogate’s Court.”