Kasowitz, Benson, Torres & Friedman LLP v Amira  Nature Foods, Ltd.  2017 NY Slip Op 30488(U) March 13, 2017 Supreme Court, New York County  Docket Number: 158126/2016
Judge: Carol R. Edmead is a fine example of the attorney fee claim-legal malpractice counterclaim paradigm.  This one ended well for the law firm.

“On August 6, 2015, Bruce Wacha (“Wacha”), Defendant’s Chief Financial Officer, engaged Plaintiff to represent Defendant in connection with a short selling attack against it.2 On August 7, 2015, the parties signed the written retention agreement (“Retention Agreement”), wherein Defendant agreed to “investigate, advise, advocate, and potentially litigate concerning, among other things, the dissemination of misinformation related to [Defendant], the manipulation of its securities, and harm caused to its business, reputation, and interests” (Retention Agreement, at p.1 ). The Retention Agreement further states that, “[i]n addition to legal fees, you will be charged for other expenses incurred in connection with our representation of you …. This retention may also include investigative work by our affiliate Intelligence Options LLC” (“IO”) (id. at p.2).”

“On August 19, 2015, Plaintiff withdrew as counsel with Defendant’s consent. On November 3, 2015, Defendant e-mailed plaintiff for the return of the remainder of the retainer fee. On November 5, 2015, Plaintiff sent Defendant its invoice-for the first time-for services provided from August 6, 2015 until August 21, 2015 (the “Invoice”).3 The aggregate amount of Plaintiffs representation of Defendant totaled $23 7 ,603 :98: fees of $143,236 for legal work, and costs of $94,367.98, of which $91,843.36 was attributable to investigative services by IO (Id.) ”

“To state a cause of action for account stated, plaintiff must allege defendant’s receipt and retention of the subject statement of account ~ithout proper objection within a reasonable time (Goldmuntz v. Schneider, 99 A.D.3d 544, 952 N_.Y.S.2d 172 [1st Dept 2012]). Where an account is rendered showing a balance, if the party receiving the account fails to dispute its correctness or completeness, that party will be bound by it as an account stated, unless fraud, mistake or other equitable considerations are shown (Shaw v. Silver, 95 A.D.3d 416, 943 N.Y.S.2d 89 [1st Dept 2012], citing Peterson v. !BJ Schroder Bank & Trust Co, 172 A.D.2d 165 [1st Dept 1991]). General objections to an invoice are insufficient to defeat a motion for summary judgment (Morrison Cohen Singer & Weinstein, LLP v. Ackerman, 280 A.D.2d 355, 356, 720 N.Y.S.2d 486 [1st Dept 2001 ]). ”

“Plaintiff fails to demonstrate a prima facie showing that it is entitled to summary judgment for its account stated claim. Plaintiffs submissions indicate that Wacha issued sufficiently specific written objections to Plaintiffs Invoice. First, Wacha’s November 16, 2015 e-mail identifies a specific objection: the excessiveness of the Invoice compared with the time devoted an~ scope of work Plaintiff completed. Further, Plaintiffs subsequent email response to Wacha on December 9, 2015 acknowledges Wacha’s objection to the Invoice by attempting to justify the amount billed vis-a-vis work performed, considering the circumstances in which it was accomplished. Second, Wacha’s December 31, 2015 e-mail specifically objects to the disbursements.and billing for legal services after the Notice and Summons were filed, as addressed within the Invoice ((see Herrick, Feinstein LLP v. Stamm, 297 A.D.2d 477, 746 N.Y.S.2d 712 [1st Dept 2002] (holding that “a trier of fact could reasonably conclude that defendant’s alleged statement … with plaintiff that he was “very troubled by the size of the bills then in hand” was sufficiently specific and timely to negate any inference of assent to the invoices.”); see also Collier, Cohen, Crystal & Bock v. MacNamara, 237 A.D.2d 152, 655 N. Y.S.2d 10 [1st Dept 1997] (sufficient proof of a timely objection found where “plaintiffs [law] firm itself wrote to defendant acknowledging his complaints and, in its October 1993 motion to withdraw as counsel, the firm gave defendant’s refusal to pay as its reason for seeking withdrawal, stating “upon receipt of the invoice, Mr. MacNamara expressed his intention not to pay the outstanding balance.)). Further, Defendant’s objections were timely. A lapse of two months between the receipt and the objection has been held not so long as to constitute “an unequivocal assent to the balance(s) stated” (Herrick, Feinstein LLP v. Stamm, 297 A.D.2d 477, 478, 478 [1st Dept 2002), quoting Epstein Reiss & Goodman v Greenfield, 102 A.D.2d 749, 750 [1st Dept 1984)). Plaintiff sent the Invoice to Wacha on November 5, 2015. Thereafter, Defendant initially objected on November 16, 2015, eleven days after it received the Invoice, and again on December 31, 2015, just under two months after Plaintiff sent the Invoice. Therefore, the branch of Plaintiffs motion for summary judgment of its account stated claim (Third Cause of Action), is denied. ”

“Plaintiff demonstrates a prima facie showing its entitlement to judgment as a matter of law against Defendant on its breach of contract claim. Specifically, Plaintiff submitted the Retention Agreement, which states that Plaintiff shall provide Defendant legal services in exchange for payment, and further, explicitly states that in the event Plaintiff terminates the Retention Agreement, such “resignation shall not affect [Plaintiffs] right to be paid for all of our previously incurred but unpaid fees? and all of our previously incurred but unpaid charges and disbursements” (Retention Agreement at p.2-3). As the Invoice, Affidavit of Michael Bowe who was “primarily responsible” for Defendant’s legal representation, Plaintiff provided legal services to Defendant. ”

 

There can be no more classic case in legal malpractice than that of a passenger who is injured in a car accident, whose attorney fails to start the case.  Nevertheless, Atiencia v Pinczewski, 2017 NY Slip Op 01839  Decided on March 15, 2017  Appellate Division, Second Department was dismissed in Kings County.

The Appellate Division could hardly have spent less time reversing.  “Here, the defendants failed to establish, prima facie, that the plaintiff could not prove that, in failing to commence a timely action against Palaquibay, the defendants failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, or that the breach of this duty was the proximate cause of the plaintiff’s alleged damages (see Rojas v Paine, 125 AD3d at 746; Velie v Ellis Law, P.C., 48 AD3d 674, 675; see also Kempf v Magida, 116 AD3d 736, 736-737; Gershkovich v Miller, Rosado & Algios, LLP, 96 AD3d 716, 717; cf. Tooma v Grossbarth, 121 AD3d 1093, 1095-1096). Furthermore, contrary to the Supreme Court’s determination, the defendants failed to establish, prima facie, that the plaintiff did not sustain “actual and ascertainable damages” as a result of the defendants’ failure to commence a timely action against Palaquibay (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 442; see Suydam v O’Neill, 276 AD2d at 550; cf. Walker v Glotzer, 79 AD3d 737, 738-739). Accordingly, the court should have denied that branch of the defendants’ motion which was for summary judgment dismissing the cause of action to recover damages for legal malpractice.”

Sometimes, people get a tad too worked up over the small things.  Ruffalo v Iannace
2017 NY Slip Op 50296(U)  Decided on March 9, 2017  Supreme Court, Westchester County
Marx, J. might be an example.

“Plaintiff moves for an order permitting him to proceed as a poor person and for assignment of counsel in this action in which he claims to have been the victim of “Legal Malpractice, Breach of Fiduciary Duty, and Unethical Misconduct.” The claims arise from the alleged negligent representation by defendant, an attorney, of plaintiff in connection with a traffic summons issued to plaintiff for alleged excessively tinted windows, which was heard in the Town of Greenburgh traffic court on March 2, 2016. Plaintiff alleges that defendant “Recklessly Failed to have this Bogus Equipment Citation Voided and Dismissed”, “did NOT want to Challenge a Dirty Corrupt Black Racist Female Judge” and “did Nothing to Augment and he also Recklessly Failed to get this Nonsense Moved to another Jurisdiction Due to the Criminality from the Police and this Dirty Lawyer and Partime [sic] Judge”. ¶¶8, 9, and 12. The papers submitted are laced with invective, insult and allegations unrelated to the application before the Court.”

“Plaintiff, Todd Ruffalo, Jr., has commenced numerous cases in the courts of the State of New York. Many of these are meretricious on their face. These include cases filed against court personnel and sitting Justices and Acting Justices of the Supreme Court, all of whom enjoy absolute immunity from suit for performing their judicial duties. [Ruffalo, Jr. v DiBella, Westchester County Index # 50290/2015, Ruffalo Jr. v Lefkowitz, Westchester Index # 60467/2015, Ruffalo Jr. v Walker, Westchester Index # 64743/2015, Ruffalo, Jr. v Giacomo, Westchester Index # 68060/2015, Ruffalo Jr. v Garfein, Westchester Index # 6886/2015, Ruffalo Jr. v Wood, Westchester Index # 69163/2015, Ruffalo Jr. v Ruderman, Westchester Index # 70196/2015, Ruffalo Jr. v Lubell, Westchester Index # 51171/2016, Ruffalo Jr. v Everett, Westchester Index # 57200/2016, Ruffalo Jr. v Diamond, Westchester Index # 57201/2016, and Ruffalo Jr. v Thorsen. Westchester Index # 59861/2016].

In addition, Mr. Ruffalo has filed other cases of dubious merit. Among these, he filed three separate actions against an individual who once served as his attorney. Ruffalo Jr. v Ackerman, Westchester Index # 52501/2011, 59440/2011 and 50524/2014. In dismissing the last of these and imposing sanctions, Justice Charles D. Wood noted that two prior Justices had cautioned plaintiff against the use of inappropriate and vulgar language.

Specifically, Justice Wood noted that Justice J. Emmett Murphy wrote in his Decision and Order dated September 6, 2011, which dismissed plaintiff’s first complaint against Mr. Ackerman in Index # 52501/2011, that “Plaintiff’s entirely inappropriate use of vulgarities and profane hyperbole as well as the vexatious, rambling abuse which have been carelessly employed … to insult and demean defendants, defense counsel, Judge Friedman and numerous others are improper.” Justice Wood also noted that Justice Mary H. Smith, in a Decision and Order dated February 2, 2012, found plaintiff’s complaint in the re-filed action against Mr. Ackerman to set forth “irrelevant, redundant, prejudicial, slanderous and scandalous assertions in a prolix, rambling, confusing manner which [were found] to be improper, irreverent”. Although Justice Smith granted plaintiff the opportunity to re-plead, he repeated his improper behavior and, ultimately, Justice Smith dismissed the action on April 20, 2012, simultaneously warning plaintiff that future filings would result in severe sanctions.

Notwithstanding that caution, plaintiff filed yet another complaint against Mr. Ackerman under Index # 50524/2014. That action was assigned to Justice Wood, who in a Decision and Order dated December 12, 2014, not only imposed sanctions, but also enjoined plaintiff from filing any further actions against Mr. Ackerman.

Plaintiff has also sued: (1) the attorneys for a bank which commenced a foreclosure action [*4]against him [Ruffalo Jr. v Leopold, Westchester Index # 69164/2015 and 67755/2016], (2) the referee appointed by the Court in the foreclosure action [Ruffalo Jr. v Trent, Westchester Index # 67756/2016], (3) the police officer who issued him the summons for the improperly tinted windows, [Ruffalo Jr. v Brown, Westchester Index # 68738/2016], (4) the attorney who represented him in connection with the traffic summons [this action], (5) the operator of an auto repair shop where Mr. Ruffalo contends his car was damaged, [Ruffalo Jr. v Contarino, Westchester Index # 51846/2016 and 51972/2017], (6) the attorneys who represented the auto repair shop, [Ruffalo Jr. v Curcio, Westchester Index # 50290/2015], and (7) the attorneys who represented the attorneys who represented the auto shop [Ruffalo Jr. v Kanca, Westchester Index # 68061/2015].[FN3]

Invariably, in each action he files, plaintiff seeks to be relieved from paying the required filing fees by filing applications, such as the one denied herein, for poor person relief. As noted above, several of these applications have been denied by this Court because they lacked proper identification and substantiation of the source of his income to allow the Court to assess his indigence or inability to pay the fees.

Plaintiff’s filings and letters routinely include inappropriate and insulting language. For example, in a letter dated February 8, 2017 directed to this Court, in a matter entitled Franzoso Contracting Inc. v Robin Ruffalo, Sr, Westchester Index # 62553/2015, various individuals were described as “dishonest”, “dirty”, felons, “unethical”, “POS”, “dirty POS”, or “hacks.” As to this Court, Mr. Ruffalo asserted, that: (1) the Court “Failed Your Classes on the CPLR in Law School”, (2) “Your [sic] in For a Lot of Legal problems and troubles here that You created Yourself and You Should Be Disbarred for good in New York State”, (3) “Your Integrity Stinks and You have Rendered Criminal Assistance to [plaintiff’s counsel]” (4) “We Understand Your Dishonesty that are New Lows which is why Your [sic] off this Farce” and (5) “Your Dereliction in Duties are Duly Noted and Sua Sponte Your [sic] Looking at Legal Action of Your Own to Deal With from Todd Ruffalo, Jr.” The letter cautions that “the Heat is going to get Turned up here against You, Your Duplicate Crony and Swindler Klein and his Felon Foe Franzoso.”

The letter concludes with the statement:

“Finally, Your [sic] Fired From this Farce as of Wednesday 2/8/17, and this Means Your [sic] off of the invented Case Now where You have been Hostile, Indifferent, and Extremely Difficult, Not to Mention Dishonest with this Foolish Liar Klein and if You Refuse to Recuse Yourself from this Bogus Case, then We will have You Removed/Disqualified down the Pike from One of the Supervising Judges, and Not Your Duplicate Dishonest Bunkie Scheinkman, from Your Improper Judicial Misconduct, Malice, Operating in Bad Faith, Fraud, Etc.”

Since defendant lacked the authority to “fire” the Court, the Court construed the letter as a request for recusal, which was denied. See Order Denying Application For Recusal dated February 10, 2017.

In addition to using improper and offensive language, it appears that Mr. Ruffalo believes that he can dictate to the Court and litigants when and how the matters will be litigated and overseen by the Court. His usual filings include statements to the effect that he is not available [*5]until after 3:30 p.m. and that depositions are not required and are a waste of time.

For example, in the Summons With Notice in this matter, plaintiff states: “Plaintiff is Kindly informing All Parties that the Plaintiff is Only Available in the Afternoon from 3:30-PM and 4:00-PM and on for Anything in this Case, etc.” He continues, “Depositions can be Setup Without going into Court before an Unqualified Referee, which can be Setup by E-Mail, or by Mail. Depositions are also NOT Mandatory in All Litigation … Depositions will in Fact in this instance be a Waste of time and Monies, which to Reiterate Depositions are NOT Mandatory in All Litigation, and the Plaintiff has the Deft. Dead to Rights for Malpractice for Mishandling a Staged and Fraudulently issued Equipment Citation…”

Simply put, enough is enough. The court system, which is already overburdened and underfunded, can scarcely spare the resources to address the repetitive, incorrect and often nonsensical filings of Mr. Ruffalo. Unless this Court acts to interdict his unrepentant and abusive filings, there will be no end to them.

Accordingly, plaintiff, Todd Ruffalo, Jr., is hereby enjoined from commencing any actions in the Supreme Court of the State of New York, County of Westchester without the expressed, prior written consent and approval of this Court.”

 

Normally when a legal malpractice case is settled, that’s the end of it.  Everyone walks away unhappy, but understanding the the dispute is finally over.  Not so in Clerico v Pollack
2017 NY Slip Op 01669  Decided on March 8, 2017  Appellate Division, Second Department.

Plaintiffs hired attorneys to sell a house.  The sale took place, but disbursements of the proceeds was challenged in a legal malpractice case.  That case was eventually settled.  Then a second legal malpractice case was commenced, on the theory that the attorneys had formed a group to buy and flip the house.  The house was flipped for a profit.  Did the release stop the second case?

“”Under the doctrine of res judicata, a disposition on the merits bars litigation between the same parties, or those in privity with them, of a cause of action arising out of the same transaction or series of transactions as a cause of action that either was raised or could have been raised in the prior proceeding'” (Bayer v City of New York, 115 AD3d 897, 898, quoting Abraham v Hermitage Ins. Co., 47 AD3d 855, 855). “Pursuant to the doctrine of res judicata, a valid final judgment, or a stipulation of settlement withdrawing a cause of action with prejudice,’ bars future actions between the same parties on the same cause of action” (Matter of Chiantella v Vishnick, 84 AD3d 797, 798 [internal citations omitted]; see CPLR 3217[a][2]; North Shore-Long Is. Jewish Health Sys., Inc. v Aetna US Healthcare, Inc., 27 AD3d 439, 440; Matter of State of New York v Seaport Manor A.C.F., 19 AD3d 609, 610).

Here, the Supreme Court erred when it determined that the instant action was barred by the doctrine of res judicata. At trial, the defendants did not proffer a stipulation of settlement or discontinuance showing that the plaintiffs withdrew the causes of action in the 2008 action “with prejudice” (see Maurischat v County of Nassau, 81 AD3d 793, 794; Maurischat v County of Nassau, 305 AD2d 470, 471). An action is not automatically terminated with prejudice merely because the parties reached a settlement (see Teitelbaum Holdings v Gold, 48 NY2d 51; Incorporated Vil. of Hewlett Harbor v Bouzalglo, 131 AD3d 512, 513; Salvador v Town of Lake George Zoning Bd., 130 AD3d 1334, 1335).

“Generally, a valid release constitutes a complete bar to an action on a claim that is the subject of the release” (Nucci v Nucci, 118 AD3d 762, 763). ” However, a release may not be read to cover matters which the parties did not intend to cover'” (id. at 763, quoting Desiderio v Geico Gen. Ins. Co., 107 AD3d 662, 663). “[I]ts meaning and coverage necessarily depend, as in the case of contracts generally, upon the controversy being settled and upon the purpose for which the release was actually given” (Cahill v Regan, 5 NY2d 292, 299; see Matter of Mercer, 141 AD3d 594, 597). Here, as the plaintiffs correctly contend, the subject release only covered the causes of action alleged in the plaintiffs’ 2008 complaint, which sought to recover sums allegedly owed in the first sale of the property, and did not encompass the causes of action set forth in the instant action, which seek, inter alia, to recover sums resulting from a second sale of the property by Tatiana Bell Corp.

Accordingly, the Supreme Court should have granted the plaintiffs’ motion pursuant to CPLR 4404(b) to set aside the decision and order dated May 20, 2015, which directed the dismissal of the action based upon the doctrine of res judicata. The matter must be remitted to the Supreme Court, Queens County, for a trial on the merits of the plaintiffs’ claims.”

 

Two recurring doctrines in legal malpractice tend to cull out complicated claims on a regular basis.  They are both seen in Rubin v Duncan, Fish & Vogel, L.L.P.  2017 NY Slip Op 01646  Decided on March 7, 2017  Appellate Division, First Department.

Failure to schedule legal malpractice claims in either a Chapter 7 or 11 filing will divest the petitioner of those claims.   This happens over and over in legal malpractice cases.  Secondly, the successor attorney principle holds that when a second attorney comes into the picture with time to fix a problem, generally the first attorney is out of the picture.

“The failure of the individual plaintiffs to schedule the instant claims as assets in their Chapter 11 bankruptcies bars their pursuit of those claims (Dynamics Corp. of Am. v Marine Midland Bank-N.Y., 69 NY2d 191 [1987]). It is immaterial that the bankruptcy court had actual knowledge of the existence of the claims (see Donaldson, Lufkin & Jenrette Sec. Corp. v Mathiasen, 207 AD2d 280, 282 [1st Dept 1994]).

However, because the Marital Trust never filed for bankruptcy, it did not lose its claims. Further, contrary to defendants’ contention, cognizable damages are pleaded by the Marital Trust’s allegations that it incurred legal fees and that it lost any source of repayment for its loans to the other plaintiffs by virtue of defendants’ malpractice. Thus, the Marital Trust alone has standing to assert the claims in this action.”

“The complaint fails to state a cause of action for malpractice based on the “recap” of accounts and balances provided in the Utah action. While defendants arguably should have found the error in the recap, the error did not cause plaintiffs any harm. It was irrelevant to the Utah proceeding. In the judgment enforcement action in the U.S. District Court for the Southern District of New York, in which the transaction was expressly litigated, plaintiffs were represented by new counsel, and neither they nor counsel corrected the error.

The complaint states a cause of action for malpractice based on the deposition advice given to Margery Rubin. The doctrine of judicial estoppel does not preclude plaintiffs from arguing against counsel that counsel’s alleged advice as to giving perjurious testimony caused injury (see D & L Holdings v Goldman Co., 287 AD2d 65, 71 [1st Dept 2001], lv denied 97 NY2d 611 [2002]). Margery Rubin did not prevail in the Utah action by virtue of her testimony. Moreover, the District Court for the Southern District of New York expressly relied on that testimony in finding certain transfers void and entering the turnover order.”

Bruce Cutler, scion of a royal Criminal Defense family (father Murray was a big player, brother a federal prosecutor) started off as a Kings County ADA, rising to Homicide Bureau Chief.  (Full disclosure…I was a lowly ADA there).  Cutler was a demigod in Brooklyn.  Then he moved onto criminal defense, eventually representing John Gotti and obtaining three acquittals.  In movies, TV and talk shows he spun away.  Later he defended Phil Spector for a period of time.

Today, his firm (he was personally dismissed) are embroiled in a legal malpractice case.  Its a rare case in which a criminal defense attorney is sued for legal malpractice.  But Rizzo v Timothy Charles Parlatore  2017 NY Slip Op 30439(U)  March 3, 2017  Supreme Court, New York County
Docket Number: 151153/16  Judge: Kathryn E. Freed concerns alleged failures in forfeiture litigation.

“In her amended verified complaint, filed with this Court on February 16, 2016 (NYSCEF Doc. No. I), plaintiff alleged that, on or about August I 0, 2011, plaintiff Ramona Rizzo was in a car which was stopped by police officers on the New Jersey side of the Lincoln Tunnel. Ex. 1, at par. 10.2 At that time, plaintiff, who had appeared on a television show called “Mob Wives,” was with her boyfriend, Joseph Sclafani, who was under investigation by law enforcement authorities. Id., at par. I I. Later that day, agents of the United States Department of Justice Drug Enforcement Administration (“DEA”), executing a search warrant, seized property, including jewelry valued at approximately $184,000, from Sclafani’ s home. Id. Plaintiff allegedly owned 42 pieces of the jewelry seized, which items were worth approximately $154,000. Id., at pars. 11, 14.

Following the seizure of the jewelry, plaintiff retained defendant Timothy Charles Parlatore, Esq. of defendant law firm Cutler & Parlatore, PLLC (“the firm”) to represent her before the asset forfeiture section of the DEA in an attempt to have the jewelry returned to her. Id., at par. 15. On or about November 9, 2011, Parlatore wrote to forfeiture counsel setting forth his intention to submit, on plaintiffs behalf, a request for remission of the forfeiture. Id., at par. 16. On or about December 15, 2011, the DEA notified Parlatore that the application he submitted on plaintiffs behalf was filed incorrectly and had to be resubmitted within 20 days. Id., at par. I 7. However, Parlatore allegedly failed to resubmit the application within the 20-day period. Id., at par. 18.

By correspondence dated January 23, 2012, Parlatore advised the DEA that, since he did not receive its December 15, 2011 letter until January 11, 2012, his submission was made within the 20- day time limit. Id., at par. 19. However, in a letter to Parlatore dated February 15, 2012, the DEA advised that the deadline for filing a claim had expired on January 16, 2012. Id., at par. 20. The DEA further advised Parlatore that plaintiffs only available remaining avenue for having the jewelry returned was a petition for remission or mitigation of forfeiture which would require plaintiff to be interviewed. Id., at par. 21.

By correspondence dated October 15, 2012, the DEA advised Parlatore that the petition he submitted on plaintiffs behalf was deficient insofar as it failed to establish a valid, good faith and legally cognizable interest in the seized property as an owner or lienholder and plaintiffs qualification as an “innocent owner.” Id., at par. 23. Plaintiff alleged that, since the DEA’s investigation concluded that it was possible that illicit drug-related funds were used to purchase the forfeited property, Parlatore had to provide evidence that the funds used to purchase the same were not drug-related, and he failed to make this showing. Id., at pars. 25-26. She further claimed that, had Parlatore diligently pursued the matter, he would been able to provide the DEA, in a timely fashion, with “documents to substantiate her claim” (id., at pars. 27-28) and that, since the DEA was not provided with the necessary documentation in a timely manner, it determined that the forfeiture was justified. Id., at par. 29.

Parlatore subsequently learned that he had an opportunity to seek reconsideration of the DEA’s decision, but only if such request were based on information or evidence not previously submitted. Id., at par. 30. An additional investigation was conducted in connection with the request for reconsideration. Id., at par. 32. During the investigation, Parlatore was advised that plaintiff was required to produce documentation regarding each piece of jewelry she wanted returned to her. Id., at par. 33. Although Parlatore requested reconsideration, he did not assist plaintiff in providing the necessary documentation and did not diligently pursue the necessary proofin a timely manner insofar as he failed to advise plaintiff that there was a deadline for the production of such documentation. Id., at pars. 31, 34-35. Plaintiff alleged that, despite the fact that the DEA left Parlatore several telephone messages requesting the necessary documentation, he “failed to make an effort to produce sufficient information or documents from a legitimate source in a timely manner [al]though such information was available.” Id., at par. 36.

On February 4, 2013, Special Agents Dodge and Waddell interviewed plaintiff and Parlatore regarding the origin of the items and, again, Parlatore allegedly “failed to inform [her as to] what was needed nor did he assist her in providing the requisite documentation to back her claim in a timely manner.” Id., at par. 3 7. Plaintiff alleged that, had Parlatore done so, “she would have been able to obtain at a bare minimum some of the documentation that was needed in a timely manner.'”ld., at par. 38.

On February 13, 2013, Special Agent Dodge again requested that Parlatore provide any of the documents which had been requested and again he allegedly “failed to act to either provide the documentation or to inform the plaintiff what was necessary so that she could obtain the documentation in a timely manner.” Id., at par. 39. Plaintiff further claimed that, since the interviews with the Special Agents, her request for reconsideration was denied because Parlatore failed to help her provide the documents requested by the DEA in a timely manner. Id., at par. 40.

By correspondence dated July 14, 2015 (Ex. 2), Vicki Rashid, Esq., forfeiture counsel forthe DEA, advised Parlatore that, despite requests by Special Agent Dodge, he (Parlatore) had failed to produce documentation establishing that legitimate income had been used to purchase the items sought to be recovered by plaintiff. Id., at par. 41.

Plaintiff alleged that Parlatore’ s “negligence has led to the forfeiture of plaintiffs property.” Id., at par. 42. She claimed that, had Parlatore advised her that there was a deadline for the production of documents, she “would have been able to recover at least a significant portion of her property and she was precluded from doing so due to the defendants’ negligence.” Id., at par. 45.”

“Since plaintiff has adequately pleaded a claim for legal malpractice, and this Court cannot, at this nascent stage of the litigation, evaluate the substantive merits of the said cause of action, this Court also denies that branch of defendants’ motion seeking to impose sanctions against plaintiff. See Southern Blvd. Sound v Felix Storch, Inc., 167 Misc2d 731 (App Term, 1996). ”

 

Terms that are often used, often lose their meaning.  What is legal malpractice?  It’s a situation in which  an attorney is retained to represent a client, takes on the case, departs from the standard of good practice for an attorney in similar representations, and where that departure from good practice proximately leads to a bad economic result, but for which departure from good practice there would have been a better economic result for the client.

That’s more exact than “the attorney made a mistake.”

Similarly, in a breach of fiduciary duty, what exactly is that fiduciary duty?  Here, we have Deutsche Bank Natl. Trust Co. v Sidden , 2017 NY Slip Op 27074, Decided on February 24, 2017, Supreme Court, Queens County where Judge Modica channels Judge Cardozo:

“In a beautifully written and scholarly article, “Understanding Fiduciary Duty,” (Fla. B.J., March 2010, at 20, 22), Florida lawyers John F. Mariani, Christopher W. Kammerer, and Nancy Guffey-Landers, Esqs., discuss the fiduciary duty:

The most basic duty of a fiduciary is the duty of loyalty, which obligates the fiduciary to put the interests of the beneficiary first, ahead of the fiduciary’s self interest, and to refrain from exploiting the relationship for the fiduciary’s personal benefit. This gives rise to more specific duties, such as the prohibition against self-dealing, conflicts of interest, and the duty to disclose material facts. Perhaps [*3]the most famous description of the duty of loyalty is by Chief Judge Benjamin Cardozo in Meinhard v. Salmon, 249 NY 458, 464, 164 N.E. 545, 546 (1928):

Many forms of conduct permissible in a workaday world for those acting at arm’s length, are forbidden to those bound by fiduciary ties. A trustee is held to something stricter than the morals of the market place. Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior.

In addition to a duty of loyalty, a fiduciary also owes a duty of care to carry out its responsibilities in an informed and considered manner and to act as an ordinary prudent person would act in the management of his or her own affairs. If the fiduciary has special skills, or becomes a fiduciary on the basis of representations of special skills or expertise, the fiduciary is under a duty to use those skills.

John F. Mariani, Christopher W. Kammerer, Nancy Guffey-Landers, “Understanding Fiduciary Duty,” Fla. B.J., March 2010, at 20, 22 (footnote references omitted).

Aside from Cardozo’s famous statement in Meinhard, made in 1928, for the New York Court of Appeals, the Supreme Court of Florida, one year earlier, in Quinn v. Phipps, 93 Fla. 805, 113 So. 419 (1927), articulated, with equal polish:

Stripped of all embellishing verbiage, it may be confidently asserted that every instance in which a confidential or fiduciary relation in fact is shown to exist will be interpreted as such. The relation and duties involved need not be legal; they may be moral, social, domestic or personal. If a relation of trust and confidence exists between the parties (that is to say, where confidence is reposed by one party and a trust accepted by the other, or where confidence has been acquired and abused), that is sufficient as a predicate for relief. The origin of the confidence is immaterial.
Quinn v. Phipps, 93 Fla. at 811, 113 So. at 421 (1927).”

 

Risk Control Assoc., Inc. v Maloof, Lebowitz, Connahan & Oleske, P.C.  2017 NY Slip Op 01654 Decided on March 7, 2017 Appellate Division, First Department was dismissed and affirmed for the reason that “The factual allegations and the damages sought in the instant action are the same as the factual allegations underlying the legal malpractice claims and the damages sought in an earlier action brought against defendants by plaintiff Risk Control Associates, Inc., the claims administrator for plaintiff National Specialty Insurance Company (Risk Control Assoc. Ins. Group v Maloof, Lebowitz, Connahan & Oleske, P.C., 127 AD3d 500 [1st Dept 2015]) (see Voutsas v Hochberg, 103 AD3d 445, 446 [1st Dept 2013], lv denied 22 NY3d 853 [2013]). The instant claims are also time-barred (see CPLR 214[6]).”

The first case was dismissed “or its failure to allege that it had a “contractual obligation to pay for the loss in the personal injury action,” and to “allege that it sustained actual damages because of this obligation” (Risk Control Assoc. Ins. Group v Maloof, Lebowitz, Connahan & Oleske, P.C., 113 AD3d 522, 522 [1st Dept 2014] [Risk Control I]).”

“Here, no damages can be “reasonably inferred,” as plaintiff’s amended allegations are defeated by the documentary evidence it submitted. The affidavit submitted by the vice-president of one of the proposed plaintiffs averred that plaintiffs were all claims administrators. Furthermore, the vice-president attested that the loss, allegedly resulting from defendants’ malpractice, was paid by an entity who was not a party plaintiff, or proposed party plaintiff. Thus, plaintiff failed to allege either a “contractual obligation to pay for the loss,” or actual damages (Risk Control I at 522;Tenzer, Greenblatt at 45).

Moreover, plaintiff’s conclusory allegations of representation will not suffice in the absence of an attorney-client relationship with defendants (see Denenberg v Rosen, 71 AD3d 187, 196 [1st Dept 2010], lv dismissed 14 NY3d 910 [2010]).

To the extent the motion sought to add the primary insurer as a plaintiff, defendants would be unduly prejudiced by the introduction of that new party plaintiff after the statute of limitations has expired (see Bellini v Gersalle Realty Corp., 120 AD2d 345 [1st Dept 1986]). ”

 

 

Bankruptcy plays a major disrupting role, and in Kleinplatz v Nathan L. Dembin & Assoc., P.C. 2017 NY Slip Op 01645  Decided on March 7, 2017 Appellate Division, First Department we see plaintiff losing the right to sue in legal malpractice.  It vanished when he repeatedly failed to list the potential claim as an asset.

“Plaintiff’s prolonged failure to disclose the instant lawsuit to the bankruptcy court renders him judicially estopped from pursuing the claim (Koch v National Basketball Assn., 245 AD2d 230, 230-231 [1st Dept 1997]; Becerril v City of N.Y. Dept. of Health & Mental Hygiene, 110 AD3d 517, 519 [1st Dept 2013], lv denied 23 NY3d 905 [2014]). While the error initially may not have been intentional, as plaintiff had not commenced the legal malpractice claim when he filed his Chapter 13 petition, and was pro se at the time and may not have known that he was required to disclose such a suit, he failed to disclose the lawsuit to the bankruptcy court even after he commenced it, even after he retained bankruptcy counsel, and even after defendants cited the failure to disclose it in an unsuccessful summary judgment motion made years earlier, in June 2011. Thus, plaintiff’s ongoing failure to correct the omission suggests it was not merely a good faith mistake or unintentional (compare Murray, 248 BR at 487; United States v Hussein, 178 F3d 125, 130 [2d Cir 1999]).

Because we determine that dismissal is appropriate on this ground, it is unnecessary to consider whether plaintiff otherwise had standing to pursue the claim.

The court providently exercised its discretion in granting leave to amend the answer (CPLR 3025[b]; Cherebin v Empress Ambulance Serv., Inc., 43 AD3d 364, 365 [1st Dept 2007]). There was no significant prejudice to plaintiff from the delay to seek leave; plaintiff cannot claim [*2]surprise regarding his own failure to disclose the instant lawsuit in the bankruptcy proceeding (Edenwald Contr. Co. v City of New York, 60 NY2d 957, 959 [1983]). As previously noted, plaintiff failed to disclose the instant lawsuit to the bankruptcy court for years, even after he was alerted to the issue of nondisclosure.”

 

Summary judgment in favor of defendant-attorneys is common; summary judgment in favor of the plaintiff-client is rare.  Genesis Merchant Partners, L.P. v Gilbride, Tusa, Last & Spellane, LLC 2017 NY Slip Op 30430(U) February 27, 2017 Supreme Court, New York County Docket Number: 653145/2014 Judge: Nancy M. Bannon is an example of plaintiffs’ case, well-played.

“In this action to recover damages, inter alia, for legal malpractice, the plaintiffs move pursuant to CPLR 3212 for summary judgment on the issue of liability on so much of the first cause of action as alleges that the defendants committed legal malpractice in failing to perfect security interests in certain life insurance policies, and dismissing the defendants’ counterclaims for unpaid legal fees. The defendants oppose the motion. The motion is granted. ”

“The plaintiffs established their prima facie entitlement to judgment as a matter of law on the issue of liability on so much of the legal malpractice cause of action as is premised on the failure to perfect security interests in the insurance policies. A cause of action to recover for legal malpractice requires proof “that the attorney failed to exercise 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 plaintiff to sustain actual and ascertainable damages.” Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY 3 d 4 3 8 I 4 4 2 ( 2 0 0 7 ) . Where, as here, an attorney fails to properly record a security interest or mishandles an express task for which he or she was engaged, it is a per se breach of the standard of care, and does not require expert testimony to establish a prima facie case, since ordinary experience of a fact finder would provide a sufficient basis for judging the adequacy of the professional service rendered. See Lory v Parsoff, 296 AD2d 535, 536 (2~d Dept. 2002); Deb-Jo Const., Inc. v Westphal, 210 AD2d 951, 951 (4th Dept. 1994); S & D Petroleum Co. v Tamsett, 144 AD2d 849, 850 (3rd Dept. 1988). A security interest in a life insurance policy may not be perfected by filing a UCC-1 financing statement with the Secretary of State (see ucc 9-109[d] [8]), but only by the actual possession of the original policy or the delivery of a properly executed collateral assignment to the underwriter of the policy. See Matter of Bickford, 265 App Div 266 (3rd Dept. 1942). Moreover, the plaintiffs established, prima facie, that the defendants’ failure to properly perfect the security interests in the policies proximately led to the plaintiffs’ inability enforce a lien on the policies after Progressive defaulted, and that the plaintiffs were unable to collect from Progressive in their Connecticut breach of contract action. Cf. Gladstone v Ziegler, 46 AD3d 366 (lsc Dept. 2007) (plaintiffs established liability, but could not demonstrate, prima facie, that their attorney’s failure to perfect a security interest proximately caused damages) . ”

“Rule 1.2(c) of the Rules of Professional Conduct provides that “[a] lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances, the client gives informed consent and where necessary notice is provided to the tribunal and/or opposing counsel.” Generally, where the scope of representation is properly limited, an attorney may not be held liable for his or her failure to undertake a task that falls outside of the scope of representation. See generally AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 435 (2007). The court, however, rejects the defendants’ contention that their submission is sufficient to defeat summary judgment. Even if there are factual disputes as to whether the defendants received any limiting instructions from Kelly and whether Kelly had authority to bind the plaintiffs with respect to the scope of representation, the plaintiffs established that the defendants, by filing the UCC-1 statements and billing the plaintiffs for that work, voluntarily assumed the obligation to perfect the security interests. Where one assumes a duty to act, the failure to perform the act in a proper fashion constitutes a breach of the assumed duty, and may render the actor liable in negligence. See Applewhite v Accuhealth, Inc., 21 NY3d 420, 431, 434 (2013); Palka v Servicemaster Mgt. Servs. Corp., 83 NY2d 579, 587 (1994); Podesta v Assumable Homes Dev. II Corp., 137 AD3d 767, 769 (2nd Dept. 2016); see generally Katz v United Synagogue of Conservative Judaism, 135 AD3d 458, 461 (1st Dept. 2016). Therefore, where a fiduciary, by its conduct, voluntarily assumes the obligation to properly deliver to, or file documentation with, a particular entity or governmental agency, the fiduciary’s failure to timely or properly deliver or file the documentation constitutes actionable negligence if it proximately causes damage to the plaintiff. See Nilazra, Inc. v Karakus, Inc., 136 AD3d 994, 996 (2nd Dept. 2016) (failure to file a certain notice with the Department of Taxation & Finance); see also AG Capital Funding Partners, L.P. v State Street Bank & Trust Co., 5 NY3d 582, 594 (2005) (failure to deliver secured indebtedness statement to a bank); Podesta v Assumable Homes Dev. II Corp., supra (failure to record partial satisfaction of mortgage) .”