It is almost universally said at Legal Malpractice (or Professional Responsibility) CLEs that suing your clients for legal fees not paid is the surest source of a legal malpractice counterclaim.  Legal fee billing appears, anecdotally, to be the largest category of litigation involving attorneys. Exeter Law Group LLP v Immortalana Inc.  2016 NY Slip Op 31913(U)  October 11, 2016  Supreme Court, New York County  Docket Number: 161667/2014  Judge: Eileen A. Rakower  is a prime example.  From a preliminary glance, the parties have expended a couple of hundred hours of work on fees, and have barely ended the pleading stage.

“Plaintiff-counterclaim defendant The Exeter Law Group LLP (“Exeter”) brings suit to collect legal fees allegedly owed to it by Defendants. Exeter commenced this action against defendants Immortalana Inc. (“Immortalana”) and Robin Farias-Eisner (“Eisner”) by filing a Complaint on November 24, 2014 asserting six causes of action, including breach of contract (first cause of action), an account stated (second cause of action), unjust enrichment (third cause of action), quantum meruit (fourth cause of action), fraud (fifth cause of action), and tortious interference with contractual relations (sixth cause of action). On January 15, 2015, Immortalana and Eisner moved to dismiss portions of the complaint (Mot. Seq. #1) and, on June 30, 2015, the Court dismissed several of Exeter’s causes of action, including its second cause of action for an account stated, and directed Exeter to file an Amended Complaint. Exeter filed its Verified Amended Complaint on July 20, 2015. The Amended Complaint named Eisner and Immortalana as defendants, as well as Kelly Day (“Day”) and Salvaregen, Inc. (“Salvaregen”). Eisner and Day are individual defendants. Immortalana and Salvaregen are corporations in which Day and Eisner allegedly held shares and Exeter allegedly performed work on behalf of both companies. The Amended Complaint asserts the following claims: breach of contract as against Eisner and Day (first cause of action); account stated for the months of February 2013 through April 2013 as against Eisner and Day (second cause of action); unjust enrichment as against Immortalana and Salvaregen (third cause of action); quantum meruit as against Immortalana and Salvaregen (fourth cause of action); and account stated for the months of May 2012 through July 2013 as against Eisner and Day (fifth cause of action). ”

“Exeter claims that for approximately three years between 2011 and 2014, Day and Eisner, as the “clients,” engaged Exeter to represent them on two matters. On June 12, 2011, Day and Eisner executed an engagement letter engaging Exeter to provide advice “on patenting and regulatory strategy for the development of certain products that may be governed under [federal law].” On February 1, 2012, Day and Eisner executed a second engagement letter reengaging Exeter to “assist [Day and Eisner] in procuring counsel to enable Ms. Kelly Day to provide Five Hundred Thousand Dollars ($500,000.00) per year in financing from her personal funds toward the efforts of Dr. Robin Farias· Eisner to continue his research.” Exeter was to “identify and engage outside counsel” to complete the work if necessary. Exeter claims, “After uncovering irregularities and conflicts with the transactions, the Exeter Firm withdrew from the engagements.” Day and Eisner refused to pay the outstanding balance of Exeter’s invoices. Exeter commenced this action to recover those monies. ”

“As for Plaintiffs second and fifth causes of action, an account stated is “an account balanced and rendered, with an assent to the balance express or implied”. (Morrison Cohen Singer & Weinstein v. Janet L. N. Ackerman, 280 A.D.2d 355, 355-56 [1st Dep’t 2001]). ”

“Here, accepting Exeter’s allegations as true and drawing all inferences in favor of the non-moving party, the four comers of Exeter’s Amended Complaint adequately plead an account stated in the second cause of action. Turning to Exeter’s cross motion for summary judgment on the second cause of action for account stated, summary judgment, the proponent of a motion for summary judgment must make a prima facie showing of entitlement to judgment as a matter of law. ”

“Day’s affidavit attests to similar statements as set forth in Eisner’s affidavit. Attached to both are emails commencing August 25, 2014 between Wong, Eisner, and Day regarding billing issues. “

The Appellate Division was shockingly clear in its enunciation of this standard, with which we were not familiar.  Plaintiffs created a unique investment strategy, and marketed it.  The IRS found fault, and assessed promoter penalty fines in excess of $7 Million.  Defendant law firm filed a bankruptcy petition, and the litigation started.  Unfortunately for Plaintiffs, Supreme Court and now the Appellate Division found it untimely.  In Hahn v Dewey & LeBoeuf Liquidation Trust
2016 NY Slip Op 06782 Decided on October 18, 2016 Appellate Division, First Department the AD used a term new to us.

“Supreme Court properly dismissed the complaint as time-barred under the three year statute of limitations applicable to professional malpractice claims (CPL 214[6]). “A legal malpractice claim accrues when all the facts necessary to the cause of action have occurred and an injured party can obtain relief in court'” (McCoy v Feinman, 99 NY2d 295, 301 [2002], quoting Ackerman v Price Waterhouse, 84 NY2d 535, 541 [1994]). Here, defendants established that the causes of action alleging legal malpractice accrued in 2000-01, when they issued opinion letters and rendered advice that plaintiffs were not required to register a tax shelter (see Ackerman at 541-543; Landow v Snow Becker Krauss, P.C., 111 AD3d 795, 796 [2d Dept 2013]). Although plaintiffs claim not to have discovered that this advice was incorrect until years later, ” [w]hat is important is when the malpractice was committed, not when the client discovered it'” (McCoy v Feinman, 99 NY2d at 301, quoting Shumsky v Eisenstein, 96 NY2d 164, 166 [2001]). Therefore, since the plaintiffs did not commence this action until March 2014, more than three years after their claims for legal malpractice accrued, the complaint was properly dismissed as time-barred.

Contrary to plaintiffs’ argument, the special facts doctrine is inapplicable. The doctrine generally applies to claims of fraud in sales transactions (Jana L. v West 129th St. Realty Corp., 22 AD3d 274, 277 n2 [1st Dept 2005]). Further, at the time defendants rendered erroneous tax advice, neither the applicable statute of limitations nor precedent establishing the accrual date of [*2]malpractice claims (see Ackerman, supra) were peculiarly within defendants’ knowledge (Jana L. at 278), and that same information could have been discovered by plaintiffs through the exercise of ordinary intelligence (id.).”

They’re the same, no?  Well, no.  Malpractice is the negligence of professionals, and simple negligence is the failure to use reasonable means.  However, Judge Mendez does a much better job of explaining in All Craft Fabricators, Inc. v Syska Hennessy Group, Inc.  2015 NY Slip Op 32239(U)  November 23, 2015  Supreme Court, New York County  Docket Number: 155408/2015 , Judge: Manuel J. Mendez.

“Plaintiff All Craft Fabricators, Inc. (herein “All Craft”) was hired by the construction manager – Skanska USA Buildings, Inc. (herein “Skanska”) – to do mill work for the refurbishment (herein “Project”) of the United Nations Headquarters (herein “UNH”), which included work on salvaged wood panels and doors within the offices of the UNH. All Craft shares offices with its affiliate, Donaldson Interiors, Inc. (herein “Donaldson” – collectively known herein as “Plaintiffs”). Plaintiffs claim the doors and panels contained toxic substances, specifically, asbestos, and that no notice of the defective condition was given to them. Plaintiffs allege that during the refurbishment of the doors and panels, due to the asbestos, they were forced to shut down their manufacturing facilities resulting in property damage, business interruption, loss of production, costs to remedy its facility, and costs to dispose of the asbestos. ”

“Plaintiffs claim that Defendant sent crates containing salvaged wood panels and doors from the UNH to perform millwork. The wood panels and doors contained asbestos. Plaintiffs contend that they were not given notice of the defective condition, [* 1] were forced to shut down their manufacturing facility, and incurred damages as a result (see Complaint, PP 12-21 ). The Complaint asserts a cause of action for negligence. Specifically, that Defendant “did not perform its work as a reasonably prudent company would under the circumstances;” did not “comply with applicable laws and regulations;” and that Defendant was “negligent” (see Complaint, PP. 29-31)”

“Defendant claims that this action is time-barred because the crates containing the toxic substance were delivered to Plaintiffs on January 23, 2013, and that Plaintiffs’ claim is for professional negligence and not simple negligence. Defendant argues that the statute of limitations on Plaintiffs’ professional negligence claim accrued on the date of delivery of the crates containing toxic substances and that the three-year statute of limitations period had expired four months prior to Plaintiffs commencing this action. “[M]alpractice in the statutory sense describes the negligence of a professional toward the person for whom he rendered a service, and that an action for malpractice springs from the correlative rights and duties assumed by the parties through the relationship. On the other hand, the wrongful conduct of the professional in rendering services to his client resulting in injury to a party outside the relationship is simple negligence” (Cubito v. Kreisberg, 69 A.D.2d 738, 742, 419 N.Y.S.2d 578, 580 [2″d Dept., 1979)). “A latent injury occurs at the time of exposure: the reason that the injury is latent is that the injury is concealed, and not visible or otherwise apparent (see Giordano v. Market Am., Inc., 15 N.Y.3d 590, 598, 915 N.Y.S.2d 884, 941 N.E.2d 727 (2010)), and the property damage results from the seepage or infiltration of a toxic foreign substance over time” (Suffolk County Water Authority v. Dow Chemical Co., 121 A.D.3d 509, 91 N.Y.S.2d 613, 620 [2″d Dept., 2014)). Plaintiffs were not in privity with Defendant. This action is based on simple negligence and CPLR 214-c applies here because the toxic condition of the doors and wood panels were a latent defect. The statute of limitations on Plaintiffs’ simple negligence accrued on June 7, 2012 when the Plaintiffs’ employees first opened the crates and sustained injuries. This action is timely. “

Magder v Lee   2015 NY Slip Op 32254(U)   November 23, 2015   Supreme Court,   New York County Docket Number: 653917/14   Judge: Saliann Scarpulla is the story of a complicated movie deal gone sour.  Nestled within is a legal malpractice case.  Watch how the Court simplifies the proceedings in the face of a legal malpractice claim.

“Plaintiff Andrea Magder (“plaintiff’ or “Magder”) brings this action against defendants Belton Lee (“Lee”), Madhattan Film Company Global, LLC (“MFCG”), Christopher Bongime (“Bongime”), Marc Jacobson, P.C. (“MJPC”), Marc Jacobson (“Jacobson”) (Jacobson, together with MJPC, “Jacobson defendants”) and nominal defendant Dining with Alex LLC (“DWA” or “Company”). The complaint asserts causes of action for: (1) breach of DWA’ s Operating Agreement (“operating agreement”) against Lee and MFCG; (2) breach of the DWA Producer Agreement (“producer agreement”) against Lee and MFCG; (3) tortious interference with contract against Lee, Bongime and Jacobson; (4) breach of fiduciary duty against Lee; (5) breach of fiduciary [* 1] duty against the Jacobson Defendants; and (6) legal malpractice against the Jacobson Defendants. ”

“The third cause of action alleges tortious interference with contract against Lee, Bongirne and Jacobson. Jacobson contends that the tortious interference with contract claim is duplicative of the legal malpractice claim and that, in any event, the complaint fails to identify any specific actions taken by Jacobson that induced the alleged breaches of the producer agreement and the operating agreement. Bongirne likewise contends that the complaint fails to allege how he procured the purported breaches. In addition, Bongirne argues that the claim fails because neither the producer agreement nor the operating agreement was actually breached.

To establish a cause of action for tortious interference with contractual relations, plaintiff must allege: “(l) the existence of a valid contract between [plaintiff] and [a third-party]; (2) defendant[‘s] knowledge of that contract; (3) defendant[‘s] intentional procuring of the breach of that contract; and (4) damages. Specifically, a plaintiff must allege that the contract would not have been breached “‘but for’ the defendant’s conduct.” Burrowes v Combs, 25 AD3d 370, 373 (1st Dept 2006) (internal citations omitted). A claim that “[arises] out of the same facts as the legal malpractice action and [does] not involve any additional damages, separate and distinct from those generated by the alleged malpractice,” will be dismissed as duplicative. Lusk v Weinstein, 85 AD3d 445, 445-446 ( l st Dept 2011 ). “The key to determining whether a claim is duplicative of one for malpractice is discerning the essence of each claim.” Johnson v Proskauer Rose LLP, 129 AD3d 59, 68 (1st Dept 2015). Here, the complaint seeks damages in excess of $500,000 for the tortious interference with contract claim, whereas with respect to the legal malpractice claim, it seeks “other compensation,” as well as disgorgement of legal fees and punitive damages. Even assuming that the $500,000 is “separate and distinct,” (Lusk, 85 AD3d at 445) from the “other compensation,” the “essence” of both claims is that Jacobson facilitated Lee in ousting Magder from the project. Johnson, 129 AD3d at 68. Therefore, the tortious interference with contract claim against Jacobson is dismissed as duplicative of the legal malpractice claim. See Weksler v Kane Kessler, P.C., 63 AD3d 529, 531 (1st Dept 2009).”

“The fifth cause of action alleges breaches of fiduciary duties against the Jacobson defendants, and the sixth cause of action asserts a cause of action against the Jacobson defendants for liability based upon legal malpractice. The Jacobson defendants argue that the malpractice claim must be dismissed for lack of privity and failure to state actual damages proximately caused by the Jacobson defendants’ alleged negligence. Additionally, the Jacobson defendants assert that the complaint fails to states a claim for breach of fiduciary duty. “An action for legal malpractice requires proof of the attorney’s negligence, a showing that the negligence was the proximate cause of the plaintiffs loss or injury, and evidence of actual damages.” Pellegrino v File, 291AD2d60, 63 (1st Dept 2002). While “[p ]laintiff is not obliged to show, at this stage of the pleadings, that [she] actually sustained damages,” she must plead “allegations from which damages attributable to [defendant’s conduct] might be reasonably inferred.” lnKine Pharm. Co. v Coleman, 305 AD2d 151, 152 (1st Dept 2003) (internal quotation marks and citation omitted). “Moreover, [plaintiff] must plead specific factual allegations establishing that but for counsel’s deficient representation, there would have been a more favorable outcome to the underlying matter.” Dweck Law Firm v Mann, 283 AD2d 292, 293 (1st Dept 2001). Generally, “New York courts impose a strict privity requirement to claims of legal malpractice; an attorney is not liable to a third party for negligence in performing services on behalf of his client.” Lavanant v General Acc. Ins. Co. of Am., 164 AD2d 73, 81 ( 1990), afld 79 NY2d 623 ( 1992). However, courts will permit a malpractice claim, in the absence of privity, where the “relationship sufficiently approach[ es] privity,” (Estate of Schneider v Finmann, 15 NY3d 306, 309 [201 O]) or where a third party suffers harm as a result of “professional negligence in the presence of fraud, collusion, malicious acts or other special circumstances.” Good Old Days Tavern v Zwirn, 259 AD2d 300, 300 (1st Dept 1999); see also Green v Fischbein Olivieri Rozenholc & Badillo, 119 AD2d 345, 350 (1st Dept 1986) (“an attorney may be held liable to a nonclient as a consequence 1.1 [* 14] of the attorney’s wrongful or improper exercise of authority, or where the attorney has committed fraud or collusion or a malicious or tortious act” [internal quotation marks and citations omitted]). A claim of fraud or collusion must be stated with particularity. CPLR 3016 (b ); see Griffith v Medical Quadrangle, 5 AD3d 151, 152 (1st Dept 2004). To establish a breach of fiduciary duty claim, a plaintiff must allege: (1) the existence of a fiduciary relationship; (2) misconduct by the defendant; and (3) damages. Burry v Madison Park Owner LLC, 84 AD3d 699, 700 (1st Dept 2011). Where the claim for breach of fiduciary duty is “premised on the same facts and seek[ s] the identical relief sought in the legal malpractice cause of action, [it] is redundant and should be dismissed.” Weil, Gotshal & Manges, LLP v Fashion Boutique of Short Hills, Inc., 10 AD3d 267, 271 (1st Dept 2004); see also lnKine Pharm. Co., 305 AD2d at 152. “

The basic question in legal pleading is what must be alleged in a successful case.  In the professional malpractice field, one frequently encounters motions to dismiss on the pleadings (CPLR 3211).  Leading Ins. Group Ins. Co., Ltd. v Friedman LLP 2016 NY Slip Op 30375(U) March 3, 2016 Supreme Court, New York County Docket Number: 651049/15 Judge: Saliann Scarpulla give us a classic rendition of the answer.

”[O]n a motion to dismiss a complaint for failure to state a cause of action, the complaint must be construed in the light most favorable to the plaintiff and all factual allegations must be accepted as true.” Allianz Underwriters Ins. Co. v Landmark Ins. Co., 13 AD3d 172, 174 (1st Dept 2004). “Whether a plaintiff can ultimately establish its allegations is not part of the calculus in determining a motion to dismiss.” EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11, 19 (2005). “However, factual allegations that do not state a viable cause of action, that consist of bare legal conclusions, or that are inherently incredible or clearly contradicted by documentary evidence are not entitled to such consideration.” Skillgames, LLC v Brody, I AD3d 247, 250 (1st Dept 2003). Where the defendant seeks to dismiss the complaint based upon documentary evidence, “the documentary evidence [must] utterly refute[] plaintiffs factual allegations, conclusively establishing a defense as a matter of law.” Goshen v Mutual Life Ins. Co. of N. Y, 98 . NY2d 314, 326 (2002). ”

“To state a claim for professional negligence, the complaint must allege “that there was a departure from accepted standards of practice and that the departure was a proximate cause of the injury.” D.D. Hamilton Textiles v Estate of Mate, 269 AD2d 214, 215 (I st Dept 2000). ”

“Moreover, this is a pre-answer motion to dismiss. Therefore, LIG need not “pro[ ve] that there was a departure from accepted standards of practice,” but rather, it need only make the necessary allegations. See D.D. Hamilton Textiles, 269 AD2d at 214- 215 (finding, in the context of a motion for summary judgment, that plaintiffs failed to prove defendant accountant’s work fell below applicable standards of care); see also EEC I, Inc., 5 NY3d at 19. Ultimately, LIG alleges that Friedman failed to identify deficiencies with LI G’s loss reserves; whether this failure “was [due to] a departure from professional accounting standards … is a question that requires expert evidence for its resolution.” Berg v Eisner LLP, 94 AD3d 496, 496 (1st Dept 2012) (reversing dismissal). Nothing in the complaint warrants dismissal at this early stage. LIG alleges that, “[b]ased on Friedman’s audit and opinion … LIG found no reason to make adjustments to its estimated loss reserves, its methods and procedures for establishing its loss reserves, or other related business conduct.” In addition, LIG alleges that, because of 8 [* 8] 10 of 31 Friedman’s clean audit, “LIG’s discovery of the understated reserves was belated, [and it] was forced to make emergency adjustments to correct the understated loss reserves,” which caused it to incur additional costs and suffer “significant regulatory action by the NYDFS.” As such, “[t]he complaint sufficiently asserts that ‘but for”‘ Friedman’s failure to identify the understated Joss reserves, LIG would have been able to take corrective actions sooner and would have avoided incurring costs in connections with its emergency measures. Fielding v Kupferman, 65 AD3d 437, 442 (1st Dept 2009) (finding proximate cause sufficiently alleged where plaintiff alleges that “he would not have incurred the tax liability that resulted from the withdrawal of funds from his retirement account,” but for defendants’ incorrect advice).  “

Plaintiff runs a business and leases from building owner.  Building owner gives a right of first refusal to the tenant, and then proceeds to try to sell the building.  Plaintiff may or may not have enough money to purchase, but in any event, it all goes wrong.  Will the Attorney-Broker be successfully sued?

Dahari v Villafana  2016 NY Slip Op 31859(U)  October 3, 2016  Supreme Court, Kings County
Docket Number: 20219/2013  Judge: Sylvia G. Ash tells us that the lawyer remains in the case for now.

“Plaintiff seeks to invalidate the sale of real property located at 1031 Flushing Avenue, Brooklyn, New York (the “Premises”) and to obtain specific performance. Villafana, the owner of the premises, entered into a lease agreement with Plaintiff on May 13,2005. Pursuant to the lease, Plaintiff agreed to occupy a commercial space on the premises. Plaintiff and Villafana renewed the lease in May 15,2010 and included a provision that provided Plaintiff a right of first refusal to purchase the premises. r t , I On January 18,2013, Villafana decided to sell the premises for $1,225,000. In facilitating the purchase, Morgan’s assignor, Guinefort Group, LLC, entered into a Contract of Sale with Villafana. In the Contract of Sale, Villafana represented that Plaintiff’s lease did not have a right of first refusal. Further, Villafana agreed to obtain a Tenant Estoppel Certificate (“Certificate”) from Plaintiff prior to closing. Villafana did not obtain the Certificate from Plaintiff, but instead provided Morgan a Certificate that he signed on Plaintiffs behalf. On August 15,2013, Villafana and Morgan closed on the Contract of Sale. In purchasing the premises, Morgan obtained a loan and line credit from Signature, secured by two mortgages on the premises. Plaintiff brought this action on November 15, 2013, as a means of invalidating the Contract of Sale and to obtain specific performance on its right of first refusal. Morgan and Signature moved for summary judgment. Morgan argued that it did not have notice of Plaintiff’ s right of first refusal because Plaintiff did not record her lease. Next, Morgan argued that Plaintiff was aware of the Contract of Sale in February 2013 and did not attempt to exercise her right of first refusal until November 15,2013. Further, Morgan maintained that Plaintiff was not ready, willing and able to purchase the premises, pointing to Plaintiff’s admission of having a net worth no greater than $133,674. Signature argued that its mortgages were superior to Plaintiff’s right of first refusal because Plaintiff did not record her lease. According to Signature, prior to the August 2013 closing, it conducted a title search and obtained assurances from Morgan that Plaintiff did not have a right of first refusal. Further, Signature argued that Plaintiff “attomed” or waived her right to object to Morgan’s ownership of the premises because Plaintiff payed rent to Morgan after the closing.”

“Turning now to whether the third-party complaint should be dismissed. Under CPLR §1007, a defendant, after serving its answer in the main action, may start a third-party suit against a third-party defendant by serving a third-party summons and complaint, along with all prior pleadings from the main action. An omission with respect to service of all prior pleadings is not a jurisdictional defect, and may be cured under CPLR §2001 (see Jackson v. Long Island Lighting Co., 59 AD2d 523 [2d Dept 1977]). Here, the alleged defects in service by Villafana are not sufficient to warrant dismissal of the third-party complaint. Therefore, Taveras’s motion is denied. Accordingly, Morgan’s and Signature’s motions to reargue are granted. After reconsideration, Morgan’s motion for summary judgment is DENIED and Signature’s motion is GRANTED. Taveras’ motion to dismiss the third-party complaint is DENIED.”

Brion v Moreira  2016 NY Slip Op 31828(U)  September 30, 2016  Supreme Court, New York County  Docket Number: 155815/2014  Judge: David B. Cohen teaches the essentials of contribution and indemnity in a legal malpractice setting.

Plaintiff wanted to have the will of a relative revoked, and an earlier will reinstated.  There was big money at stake, and he hired Defendant law firm to work on the revocation.  This took place while the testator was still alive.  The law firm was unsuccessful in the revocation.  Testator died, and a second law firm was hired to probate the will, or in essence oppose the probate.  That too went badly.  What is the relationship between law firm 1 and law firm 2 when plaintiff sues law firm 1?

“It is well settled law that that an attorney sued for malpractice may assert a claim for contribution against another lawyer who advised the plaintiff on the same matter (Millennium Import, LLC v Reed Smith LLP, 104 AD3d 190 [1st Dept 2013]). In Schauer v Joyce (54 NY2d 1 [1981]), the Court of Appeals explained the malpractice contribution theory stating: Id. at 5.

“CPLR 1401, which codified this court’s decision in Dole v Dow Chem. Co. (30 NY2d 143), provides that “two or more persons who are subject to liability for damages for the same personal injury, injury to property or wrongful death, may claim contribution among them whether or not an action has been brought or a judgment has been rendered against the person from whom contribution is sought.” The section “applies not only to joint tortfeasors, but also to concurrent, successive, independent, alternative, and even intentional tortfeasors” (Siegel, New York Practice,§ 172, p 213; see McLaughlin, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR 1401, pp 362- 363).”

“The Schauer Court continued and explained that the relevant question under CPLR 1401 is not whether the third-party defendant owed a duty to defendant but whether they each owed a duty to plaintiff and by breaching their respective duties each contributed to the ultimate injuries (id.). “The ‘critical requirement’ for apportionment by contribution under CPLR article 14 is that “the breach of duty by the contributing party must have had a part in causing or augmenting the injury for which contribution is sought” (Raquet v Braun, 90 NY2d 177, 183 [1997]). Thus, for defendants to successfully state a cause of action here against Delaurentis, it must allege that Delaurentis had a duty to plaintiffs and that Delaurentis’ conduct breached such duty. ”

“If defendants are successful in their defense of this matter, the claim for contribution will be academic as defendants will not be liable for malpractice. If plaintiff is successful in this matter and defendants’ are found to be liable for malpractice for its failure to revoke the 2010 will and reinstate the 2004 will, defendants’ first two theories for contribution could not have had a part in causing, exacerbating or augmenting plaintiffs’ injuries as to the $2,100,000 sought. The malpractice injury solely stems from defendants’ alleged (in)actions. There is no allegation here that DeLaurentis augmented the injury be also failing to revoke/reinstate the wills in question. In fact, based upon the facts presented, DeLaurentis’ involvement began with the representation of plaintiff after the death of Miguel Brion and, thus, could not have revoked the will and stopped the injury (see Pellegrino v File, 291 AD2d 60 [1st Dept 2002]). To the extent that defendants’ contend that DeLaurentis’ advice was faulty and had DeLaurentis litigated the probate matter the result would have been different, if that contention is correct then, defendants would not be liable for malpractice. Plaintiffs·’ entire action for damages hinges on that very question and plaintiffs can only be successful if they prove otherwise, i.e., that the 2010 will was not revoked. Therefore, to the extent that defendants’ seek contribution relating to the portion of plaintiffs’ claim for $2, 100,000, that claim is dismissed.2 However, plaintiffs also seek $835,000 in damages for legal fees relating to the probate matter. Defendants have properly stated a cause of action for contribution in that portion. Defendants’ contention that a portion of those legal fees are higher than they should be because of wrongful motion practice, poor advice and failure to seek defendants’ testimony all could have exacerbated the total legal fees and thus, defendants’ have properly stated a cause of action for contribution. DeLaurentis argues that those decisions are legal strategical decision and cannot rise to the level of malpractice. DeLaurentis cites to Rosner v. Paley, 65 NY2d 760 [1985] and Mars v. Dobrish, 66 AD3d 403 in support of this theory. However, Rosner and its progeny stand for the proposition that neither an error in judgment nor in choosing a reasonable course of action constitutes malpractice (id.; Hand v Silberman, 15 AD3d 167 [1st Dept 2005]). Here, defendants are not alleging that the actions of DeLaurentis constitute malpractice. Rather, they allege that to the extent that plaintiffs suffered $835,000.00 of damages in legal fees, the actions of DeLaurentis augmented and exacerbated a portion of that amount and seek contribution for that portion. Because defendants have stated a cause of action for contribution and not malpractice, that portion of the complaint survives.  “

Argue about “duty” and “privity” as much as you wish, once an attorney agrees to undertake a task, they can be held responsible for not performing.  While the “privity” bar is quite high, in Nilazra, Inc. v Karakus, Inc.  2016 NY Slip Op 01302 [136 AD3d 994]  February 24, 2016  Appellate Division, Second Department the attorney voluntarily gave up that protection.

“The plaintiff commenced the instant action to recover damages arising from a sales tax lien that accrued after it purchased a restaurant from the defendant Karakus, Inc. (hereinafter the seller). The defendant/third-party plaintiff, Nellie Levitis, also known as Nelly Levitis (hereinafter Levitis), represented the plaintiff as the purchaser, and the defendant/third-party defendant, Erik Ikhilov, represented the seller. Tax Law § 1141 (c) requires that at least 10 days prior to the transfer of a business, the purchaser must file a notification of sale, transfer, or assignment in bulk (hereinafter the notification) with the New York State Department of Taxation and Finance (hereinafter the Department). The failure to timely file the notification results in the seller’s sales tax liabilities attaching to the purchaser (see Tax Law § 1141 [c]; Randazzo v Nelson, 128 AD3d 935 [2015]; Yiouti Rest. v Sotiriou, 151 AD2d 744, 745 [1989]).

Levitis alleges that Ikhilov had a preexisting relationship with the plaintiff’s principal, Emir Huner, and that he referred Huner to her to perform legal services in relation to the purchase of the restaurant. Levitis further alleges that Ikhilov assured her and her client that he would timely file the notification with the Department, and would hold the amount of the purchase price in escrow to pay any sales tax determined to be owed by the seller. In addition, Levitis alleges that Ikhilov promised to prepare, and in fact did prepare, all of the other documentation, including the contract of sale, riders, and schedules necessary to consummate the sale of the restaurant. Ikhilov did not file the notification with the Department until the closing date. As a result of the late filing, the seller’s tax liabilities in the amount of $83,333.33 attached to the purchaser. The total purchase price of the restaurant was $90,000.

The plaintiff thereafter commenced the main action against, among others, its attorney Levitis alleging, among other things, legal malpractice arising from her failure to verify that the notification had been timely filed by Ikhilov. Levitis commenced a third-party action seeking contribution and indemnification against Ikhilov alleging, among other things, that he had voluntarily assumed a duty to timely file the notification. Ikhilov moved pursuant to CPLR 3211 (a) (7) to dismiss the third-party complaint. The Supreme Court denied the motion.

The Supreme Court properly determined that the third-party complaint, as supplemented by Levitis’s affidavit, sufficiently pleaded a cause of action to recover damages for negligence, as it alleged, inter alia, that Ikhilov voluntarily assumed Levitis’s duty, as the attorney for the purchaser, to timely file the notification with the Department, and breached that duty (see AG Capital Funding Partners, L.P. v State St. Bank & Trust Co., 5 NY3d 582, 594 [2005]; see also Schwartz v Greenfield, Stein & Weisinger, 90 Misc 2d 882 [Sup Ct, Queens County 1977]; cf. Council Commerce Corp. v Schwartz, Sachs & Kamhi, 144 AD2d 422, 424 [1988]).”

This was the order of events in 135 Bowery LLC v Sofer  2016 NY Slip Op 31012(U)  June 2, 2016 Supreme Court, New York County  Docket Number: 108020/2011  Judge: O. Peter Sherwood.

“This is one of two cases based on the same set of facts. Steven Seitzman and Judith Scitzman (the Seitzmans) are the sole members of 135 Bowery, LLC ( 135 Bowery). 135 Bowery owned the property located at 135 Bowery, New York, New York (the Property). In 2007, the plaintiffs sold the Property with the assistance of their attorney, Alan Young (Young, now deceased), a partner at Lindenbaum & Young, to fund the Seitzmans’ retirement. Plaintiffs claim that Young diverted the proceeds of the sale, sent some of it to entities he controlled, used other monies to buy real property for his own benefit, and lied to the Seitzmans about the status of their investments. ”

“Steven Seitzman (Stcven) and Judith Seitzman (Judith) are owners of 135 Bowery Street, LLC. In April of 2007, they hired attorney Alan Young to represent them in connection with the sale of the Property. Young counseled them in the attempt of an United States Internal Revenue Code § 1031 exchange (by which taxes would be deferred if the proceeds are invested in other. similar, real estate within a specified time after the sale). Liebman was the exchange trustee. The sale of the building closed on December 28, 2007. At the closing, plaintiffs received net proceeds of $4,513,711. This sum. was deposited in the LY IOLA Account and eventually $4,672.553.64 was transferred to Liebman, the Section 1031 Exchange Trustee (Steven aff at ii 10-12, NYSCEF Doc Nos. 106, 114, 115, J 19).

On January 3, 2008, Young sent Liebman a letter instructing him lo transfer $3,500,000 to LY to be used for down payments on the purchase of two parcels of .land in Sullivan County, New York (NYSCEF Doc. No. 116). Young attached unsigned draft contracts which purportedly provided a basis for the transfer (id.). One contract was for an 83 .19 acre parcel (the “83 Acre Property,” id). The other was for a single family home (the “Mosquera Property,” id). Young was listed as counsel for the seller on both contracts (id.). Patrick Lucas, an associate at LY, appears on the draft contracts as representing the purchaser in both transactions (id.; Robert tr., NYSCEF Doc. No. 112, p.26). 10717 is named in the contract as the seller of the 83 Acre Property, with provision for Petri signing on behalf of that entity. According to the Sullivan County Tax Map and Records System, the 83 Acre Property was owned by a George Bagely (NYSCEF Doc. No. 117). Liebman transferred $3,500,000 to the LY IOLA account that day (NYSCEF Doc No. 118). ”

“Where the complaint against an attorney alleges breach of fiduciary duty, fraud, aiding and abetting fraud, and negligent misrepresentation, and the claims are all predicated on the same allegations and seek identical relief to the legal malpractice claim, the former claims should be dismissed as redundant of the malpractice claim (see Ulico Casualty Co. v Wilson. Elser, Moskowitz. Edelman & Dicker, 56 AD3d 1, 14 (1st Dept 2008) dismissing breach of contract, breach of fiduciary duty, aiding and abetting breach of fiduciary duly and tortious interference with contractual relations claims as duplicative of the malpractice cause of action]; Nevelson v Carro. Spanbock, Kaster & Cuiffo, 290 AD2d 399, 400 [I st Dept 2002][ dismissing claims for breach of contract and breach of fiduciary duty as those claims were “predicated on the same allegations and seek relief identical to that sought in the malpractice cause of action”j Sitar v Sitar, 50 AD3d 667, 670 [2d Dept 2008] affirming dismissal of causes of action alleging fraudulent misrepresentation and negligent misrepresentations “insomuch as those causes of action arise from the same facts as the cause of action alleging legal malpractice and do not allege distinct damages”j; and Sage Realty Corp. v Proskauer Rose, 251 AD2d 35, 39 [1st Dept 1998] [breach of contract and fraudulent misrepresentation claims dismissed as redundant of malpractice claim I).

As is discussed below, the plaintif’s motion for summary judgment on the legal malpractice claim must be granted against Young and LY. It must be denied as against Robert and LYPC. “

From this decision, it seems there is little difference, hence much duplication.  Duplication in the legal malpractice world means dismissal of causes of action, which is what happened here.  Justice Edmead bought none of defendant (counterclaimant’s) arguments.  She dismissed the cause of action in Brinen & Assoc. v Krippendorff  2016 NY Slip Op 31803(U)  September 29, 2016
Supreme Court, New York County  Docket Number: 653485/2014.

“This action arises from an agreement between Plaintiff Brinen & Associates, LLC (“Plaintiff), a law firm, and Defendant Kaihan Krippendorff (“Defendant”), who retained Plaintiff for representation in certain transactional matters pursuant to an engagement letter (the “Agreement”). Plaintiff moves pursuant to CPLR 321 l(e) to dismiss Defendant’s sixth counterclaim for breach of fiduciary duty, arguing that the counterclaim duplicates Defendant’s fifth counterclaim for breach of contract (see NYSCEF 129 [“Second Amended Answer”]). ”

“Under CPLR 321 l(a)(7), a cause of action for breach of fiduciary duty whose allegations are merely duplicative of a breach of contract claim cam10t stand (William Kaufinan Org., Ltd v Graham & James LLP, 269 AD2d 171, 173 [1st Dept 2000], accord Weight v Day, 134 AD3d 806, 808-09 [2d Dept 2015] (affirming dismissal of breach of contract cause of action as duplicative of the causes of action alleging accounting malpractice and breach of fiduciary duty); see also Joyce v Thompson Wigdor & Gilly LLP, 2008 WL 2329227, 36 Media L Rep 2030 [SDNY June 3, 2008] (overlapping claims of negligence, breach of contract, breach of fiduciary duty, negligent misrepresentation, or fraudulent misrepresentation premised on the same facts and seeking identical relief as a claim for legal malpractice are generally dismissed as duplicative [collecting cases])). Conversely, both causes of action may co-exist where a claim of breach of fiduciary duty rests on a duty separate and distinct from the breach of contract (Savage Records Group, NV v Jones, 247 AD2d 274, 274-275 [1st Dept], Iv denied 92 NY2d 804 [1998] (when parties have . entered into a contract, unless a party can show a separate duty, “independent of the mere contract obligation,” no fiduciary relationship is established); compare Mandelblatt v Devon Stores, Inc., 132 AD2d 162, 163 [lst Dept 1987] (breach of fiduciary duty for disparaging the employer was found to be separate and distinct from the former employee’s alleged failure to perform his duties under the contract) with William Kaufman Org, 269 AD2d at 173 (“[h]ere, there is no such distinction. Indeed, the cause of action for breach of contract refers … to the unethical conduct described in the … breach of fiduciary duty”); see also MBIA Ins. Corp. v Countrywide Home Loans, Inc., 87 AD3d 287, 293 [1st Dept 2011] (“[u]nlike a misrepresentation of future intent to perform, a misrepresentation of present facts is collateral to the contract … and therefore involves a separate breach of duty”); Brooks v Key Trust Co. Nat. Ass’n,26 AD3d 628, 809 NYS2d 270, 272-73 (3d Dept 2006) (in order to survive a motion to dismiss, a claim for breach of fiduciary duty must “set[ ] forth allegations that, apart from the terms of the contract, the parties created a relationship of higher trust than would arise from , [their contracts] alone” [emphasis added])). ”

“However, though an attorney-client relationship is unique and may create duties independent of the contract, the focus for the purposes of analyzing the claims’ overlap must be on the “essence of the claims” – in other words, the manner in which the duties were alleged to have been violated, and the alleged harm flowing from any violation (Johnson v Proskauer Rose LLP, 129 AD3d 59, 70 [1st Dept 2015]). Claims are duplicative where they arise from the same facts and seek the same damages for each alleged breach (Amcan Holdings, Inc. v Can. Imperial Bank of Commerce, 70 AD3d 423, 426 [1st Dept 2010]; see e.g., Chowaiki, 115 AD3d at 600-01 (dismissing duplicative claim because it was premised upon the same facts and sought identical damages, return of the excessive fees paid); Shaub and Williams, L.L.P. v Augme Tech., Inc., 13 CIV. 1101GBD,2014 WL 625390, at *3 [SDNY Feb. 14, 2014] (“Defendant’s breach of fiduciary duty and breach of implied duty of goog faith a:nd fair dealing counterclaims arise out of the same set of alleged excessive billing practices [and seek the same damages] as Defendant’s breach of contract counterclaim); Morgan, Lewis & Bockius LLP v IBuyDigital. com, Inc., 14 Misc 3d 1224(A) [Sup Ct NY County 2007] (counterclaim alleging that law firm breached its fiduciary duty by failing to abide by engagement letter’s express promise duplicated breach of contract counterclaim premised on the same letter)). Evert the presence of distinct fraud and nonfraud components that seemingly differentiate claims does not preclude dismissal when the claims allege “virtually identical” facts, theories, and damages (NYAHSA Services, Inc. v People Care Inc., 141 AD3d 785 [3d Dept 2016]). There is no appreciable difference between the disputed causes of action here. The breach of contract claim seeks damages pursuant to improper and fraudulent billing, misappropriation of a retainer, “conflict of interest-ridden advice,” and misrepresentation of skills, experience, and ability (Amended Answer ii 63). In nearly identical language, including allegations of fraud, the breach of fiduciary duty counterclaim seeks damages pursuant to “fraudulent conduct by failing to disclose … a conflict of interest,” fraudulent billing, and retainer malfeasance (Amended  Answer ¶ 67). “