Bank hires accountants.  Accountants fail to file an extension.  Bank loses $ 2.5 Million in carry-back losses.  Seems simple, no?  Not simple.

In First Cent. Sav. Bank v Parentebeard, LLC  2015 NY Slip Op 31921(U)  October 13,   2015  Supreme Court, New York County  Docket Number: 653680/2014  Judge: Shirley Werner Kornreich we see a limitation of liability in the retainer agreement that purports to shield the accountants from just about all mistakes.

“The Bank conducts business on a fiscal year ending September 30. if 16. For the fiscal year ending on September 30, 2010, the Bank was required to file its federal, state, and local tax returns by December 15, 2010. Id. The Bank alleges that “Parente agreed to file extensions with the various taxing authorities, which permitted [the Bank] to file its tax returns for the fiscal year ending September 30, 2010 on June 15, 2011.” if 17. The Bank further alleges that “[o]n or about December 15, 2010, Parente advised [the Bank] that it had electronically filed IRS form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns (“Form 7004″), with the Internal Revenue Service [the IRS] timely, thereby extending [the Bank’s] date to file its tax returns until June 15, 2011.” if 18. Approximately five months later, the Bank engaged Parente to file its federal, state, and local tax returns for the fiscal year ending September 30, 2010. if 19. Parente’s engagement is governed by a letter agreement dated May 2, 2011 (the Agreement). See Dkt. 9. The Agreement provides that the engagement is limited to the preparation and filing of the delineated 2010 tax returns, and in consideration for such services, the Bank agreed to pay Parente a fee of $7,000. See id. at 3. The Agreement is clear that “[Parente’s] work in connection with the preparation of [the Bank’s] corporate income tax returns does not include any procedures designed to discover fraud, defalcations, or other irregularities, should any exist” and that Parente was “undertaking this engagement based on [the Bank’s] express agreement that [the Bank is] releasing [Parente] from any liability for failure to detect fraud.” See id. (emphasis added). The Agreement further provides:

In recognition of the relative risks and benefits of this agreement to both [the Bank and Parente], [the Bank and Parente] have discussed and agreed on the fair 2 … [* 2] See id. allocation of risk between them. As such, [the Bank] agrees, to the fullest extent permitted by law, to limit the liability of [Parente to the Bank] for any and all claims, losses, costs, and damages of any nature whatsoever, so that the total aggregate liability of [Parente to the Bank] shall not exceed [Parente’s] total fee for Services rendered pursuant to this agreement [i.e., $7,000]. [The Bank and Parente] intend and agree that this limitation apply to any and all liability or cause of action against [Parente J, however alleged or arising, unless otherwise prohibited by law.  see id.

Additionally, attached to the Agreement are “Additional Terms and Conditions.” See id. at 5-8. Condition 8 states:

Neither [the Bank or Parente] will, in any event, be liable to the other, for any reason, for any consequential, incidental, special, punitive, or indirect damages, including loss of profits, revenue, data, use of money or business opportunities, regardless of whether notice has been given or there is an awareness that such damages have been or may be incurred. See id. at 6.

Pursuant to the Agreement, Parente prepared and filed the Bank’s 2010 federal tax return. 1 Complaint~ 19. The IRS, however, rejected the tax return as untimely because it had no record of a Form 7004 being filed on the Bank’s behalf. Id. As a result of the late filing, the IRS disallowed the Bank’s right to carry-back $2,514,143 of net operating losses (the Tax Benefit). ~ 20. Though the Tax Benefit was disallowed by the IRS, it was nonetheless included on a September 30, 2010 financial statement issue by Parente (the Financial Statement). ~ 21. The complaint, however, does not state when Parente prepared or issued the Financial Statement or whether it was prepared pursuant to the Agreement or as part of a separate engagement.2″

“Parente argues that even if its liability is established, liability is capped at the $7 ,000 fee amount set forth in the Agreement. See Dkt. 9 at 3. Parente further argues that to the extent the complaint seeks consequential damages, such damages are also expressly precluded by the Agreement. See id With respect to the Bank’s first cause of action relating to Parente’s failure to file the Form 7004, the limitation of liability clauses do not apply because the Bank is not asserting a claim for negligently preparing its 2010 federal tax return. The Bank does not claim that the substance of the 2010 return was improper. Rather, the Bank claims that Parente previously failed to timely file the Form 7004, and as a result, the IRS disallowed the Tax Benefit. The disallowance was not the result of a negligently prepared return. Consequently, the Bank’s claim does not arise from the engagement governed by the Agreement, which was strictly limited to preparation of the Bank’s 2010 tax returns. Instead, the Bank’s claim arises from Parente’s alleged negligence committed five months prior to the engagement.”

Nowhere in the Agreement is there anything that states, as is common in contracts that purport to release all known and unknown claims between parties, that the Agreement releases or limits Parente’s liability for matters beyond the scope of the retention for the preparation of the Bank’s 2010 tax returns. Nor does the Agreement purport to waive or release claims for all wrongdoing that already occurred. Parente clearly understood the distinction between a retrospective release of claims and a prospective limitation ofliability, as the Agreement separately provides that the Bank “is releasing [Parente] from any liability for failure to detect fraud.” See Dkt. 9 at 3 (emphasis added). The failure to detect fraud is a wrong distinct from the mere negligent preparation of a tax return. Had Parente sought an express release for any other actions taken prior to the preparation of Parente’s 2010 returns, or indeed a release for all actions prior to the engagement, it could have so provided. Hence, the court rejects Parente’s argument that its liability for negligence committed with respect to its failure to file the Form 7004 is limited to $7,000.”

Disciplinary charges are not an uncommon event, but we have rarely read of self-destructive conduct as is set forth in Matter of Frelix  2015 NY Slip Op 07775  Decided on October 22, 2015
Appellate Division, First Department  Per Curiam.  The conduct brought a 5 year suspension (they hinted that disbarment was just avoided).  What is more important to us, is that all of this tiresome and unnecessary lawyer disregard hurt regular plaintiffs.  They claim that Frelix committed legal malpractice, and it’s our guess that there will be little or no insurance to cover their claims.  Here is the back story:

“In May 2013, respondent was served with a notice and statement of charges alleging 15 counts of professional misconduct involving four matters, and charging violations of Rules of [*2]Professional Conduct (22 NYCRR 1200.0) rule 1.3(b), rule 1.4(a)(1)(iii), rule 8.4(d), rule 8.4(h), rule 1.16(b)(3), and Code of Professional Responsibility DR 1-102(a)(4) (22 NYCRR 1200.3[a][4]) (two counts), DR 1-102(a)(5) (22 NYCRR 1200.3[a][5]) (seven counts), DR 7-102(a)(2) (22 NYCRR 1200.3[a][2])^[FN1]. Respondent was charged with engaging in a pattern of misconduct including neglect, ex parte communications, misleading the Departmental Disciplinary Committee (the Committee), frivolous motion practice, and disregard of court orders. In her amended answer, respondent denied the charges.

In August 2013, the Committee moved before a referee to find respondent guilty, pursuant to the doctrine of collateral estoppel, of Charges 5-10, 12, and 15, based upon findings and rulings issued by several courts ^[FN2]. The referee granted the motion in its entirety on November 13, 2013, and, following a liability hearing, issued a report sustaining the remaining charges on [*3]April 25, 2014^[FN3]. After a sanction hearing, the referee issued a report, dated October 17, 2014, recommending a 3½-year suspension (to be reduced by six months if respondent submits evidence of remedial studies in ethics and professionalism and pays outstanding fines and penalties).

On January 22, 2015, a Hearing Panel convened for a hearing scheduled to begin at 10:30 a.m. After waiting for respondent for an hour, the Panel proceeded with the hearing in her absence ^[FN4]. By report and recommendation dated March 12, 2015, the Panel recommended affirming the referee’s liability report, disaffirming the sanction report, rejecting the referee’s proposed 3½-year suspension and, instead, imposing a five-year suspension.

Now, by a petition dated April 9, 2015, the Committee seeks an order, pursuant to the Rules of the Appellate Division, First Department (22 NYCRR) § 603.4(d), confirming the Hearing Panel’s report and recommendation and suspending respondent from the practice of law for five years. Respondent opposes the motion and seeks dismissal of the Panel’s report.

We find that the Hearing Panel’s findings of fact and conclusions of law, sustaining all 15 [*4]charges, are supported by an overwhelming amount of evidence and should be confirmed. Respondent’s conduct is marked by her absolute lack of consideration for the courts, her adversaries, and her clients, resulting in the dismissal and/or expiration of time to appeal in each case at issue.

With respect to the charges that were sustained pursuant to the doctrine of collateral estoppel, the Hearing Panel properly found that there was an identity of issues with respect to the underlying orders and that respondent had a full and fair opportunity to litigate those issues (see Kaufman v Eli Lilly & Co., 65 NY2d 449, 455 [1985]). In each case, respondent was given notice of the possible imposition of sanctions and an opportunity to be heard, and either unsuccessfully appealed, attempted to appeal, or took no appellate action.

Respondent’s claim that the Committee admitted, by silence, that her arguments as to collateral estoppel were correct, is nonsensical. Since bringing the collateral estoppel motion, the Committee has consistently maintained the doctrine’s applicability to the underlying sanction orders.”

“As to the remaining charges, respondent’s claim that certain documents relieve her of responsibility is unpersuasive. For example, in her letter to opposing counsel in the first case in the Southern District of New York (SDNY), respondent admitted her failure to contemporaneously serve the defendant a copy of her letter to the unassigned judge, making it an ex parte communication. Moreover, contrary to respondent’s suggestion, a letter from her client’s new counsel in the second SDNY case does not indicate that the client continued to consider respondent to be her counsel; rather, it accused respondent of legal malpractice.

Furthermore, respondent’s objections to the Panel’s composition are meritless. The Panel was comprised of four of the seven members identified in the Committee’s prehearing notice, three of whom were lawyers. Pursuant to 22 NYCRR 605.22(d), all matters before a Hearing Panel are to be determined by three members, two of whom constitute a quorum. Only two members of the Panel must be attorneys (see 22 NYCRR 605.18[b]). Further, respondent’s claim that the Panel did not consider her positions is belied by the Panel’s 58-page report, which reflects a thorough review of the record.

The charged conduct is serious and involves the disregard of numerous court orders and the advancement of frivolous claims, resulting in the dismissal of three matters. Moreover, by failing to timely file papers, failing to appear before the Panel, presenting factually and legally unsupportable arguments, accusing the Panel of bad faith, and suggesting that the Committee hacked her email, respondent is displaying the same kind of disregard for the law, the courts, and her adversaries as she displayed in the underlying cases ^[FN5]. Her actions reflect a lack of understanding of the basic principles guiding professional conduct. She has failed to demonstrate remorse or acknowledge her wrongdoing, and has not presented any character witnesses or evidence of mitigating factors.

With respect to sanctions, the Panel’s recommendation of a five-year suspension, which respondent does not address, is an appropriate sanction, perhaps even a generous one, in light of respondent’s pattern of misconduct in four cases over a five-year period, misconduct which continued in the face of repeated warnings and sanctions. The multiple aggravating factors, including respondent’s lack of remorse or acknowledgment of wrongdoing, and failure to pay prior sanctions, and the absence of compelling mitigating factors also counsel in favor of a lengthy suspension (see Matter of Abady, 22 AD3d 71 [1st Dept 2005] [five-year suspension for pattern of misconduct including neglect and repeated disregard of court orders despite steps to improve behavior, character testimony, and extensive pro bono work]; Matter of Brooks, 271 AD2d 127 [1st Dept 2000], appeal and lv dismissed 95 NY2d 955 [2000] [disbarment, despite health problems and personal tragedies, for neglect, repeated failure to comply with court orders, knowingly advancing unwarranted claims, failure to cooperate with the Committee, and failure to fully accept responsibility]; Matter of Kramer, 247 AD2d 81 [1st Dept 1998], lv denied 93 NY2d 883 [1999], cert denied 528 US 869 [1999] [disbarment for pattern of misconduct over many years, including refusing to cease acting on clients’ behalf after discharge, disobeying discovery orders, making false sworn statements, and filing frivolous claims]).”

Attorneys have their own special obligations in handling financial matters for their clients.  When they are told to wire money to a third party, they have some obligation to check on the bona fides of the recipient. They may not blindly follow wrongful or fraudulent orders.  This is the reason we see summary judgment fail on appeal in Fidelity Natl. Tit. Ins. Co. of N.Y. v Lite & Russell, P.C.  2015 NY Slip Op 07616  Decided on October 21, 2015  Appellate Division, Second Department.

“In 2005, the defendants, Lite & Russell, P.C., and Justin Lite (hereinafter together the Lite defendants), represented Albarano Holding Corp. (hereinafter Albarano), a private mortgage lender, at a closing for a loan transaction. After the closing, the Lite defendants wired certain proceeds of the loan transaction to a Swiss bank account in Zurich, allegedly acting under the instructions of the purported borrowers. The individuals purporting to be the borrowers were later discovered to be imposters. Albarano then filed a claim with the plaintiff to recover the subject proceeds. The plaintiff paid Albarano, and thereafter commenced the instant action, as subrogee of Albarano, against the Lite defendants to recover damages, inter alia, for legal malpractice. The Lite defendants moved for summary judgment dismissing the complaint, and the Supreme Court granted the motion. We reverse the order insofar as appealed from.”

“Here, in support of their motion, the Lite defendants established, prima facie, inter alia, that Lite did not fail to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession (see Feldman v Finkelstein & Partners, LLP, 131 AD3d 505; Schiff v Sallah Law Firm, P.C., 128 AD3d 668). However, in opposition, the plaintiff raised a triable issue of fact, inter alia, as to whether Lite’s conduct in wiring the subject funds constituted legal malpractice and whether this conduct was a proximate cause of Albarano’s damages (see Blanco v Polanco, 116 AD3d 892, 894-895). Accordingly, the Supreme Court should have denied the Lite defendants’ motion for summary judgment.”

There are legal malpractice cases, and then, there are world-class multi-million dollar cases of legal malpractice.  Nomura Asset Capital Corp. v Cadwalader, Wickersham & Taft LLP  2015 NY Slip Op 07693  Decided on October 22, 2015  Court of Appeals  Rivera, J. is one of the latter types.  It involves commercial mortgage-backed securitization and this case was over a $67.5 million problem.  As the Court of Appeals found, Plaintiff made “immense” profits, and Cadwalader did not do so badly for itself, either.

“Now, almost two decades since the events leading to the original securitization, [*3]and almost ten years since Nomura filed this action, the case has reached this Court, and we are presented with the question whether Cadwalader is entitled to summary judgment as to all or part of the first cause of action. For the reasons set forth below, we conclude that Cadwalader has established, as a matter of law, that summary judgment and dismissal of the legal malpractice cause of action are merited in this case.”

“On a motion for summary judgment, the moving party must “make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact” (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). If the moving party produces the requisite evidence, the burden then shifts to the nonmoving party ” ‘to establish the existence of material issues of fact which require a trial of the action’ ” (Vega v Restani Const. Corp., 18 NY3d 499, 503 [2012], quoting Alvarez, 68 NY2d at 324). Viewing the evidence “in the light most favorable to the non moving party,” if the nonmoving party, nonetheless, fails to establish a material triable issue of fact, summary judgment for the movant is appropriate (Ortiz v Varsity Holdings, LLC, 18 NY3d 335, 339 [2011]; see Alvarez, 68 NY2d at 324).

To sustain its cause of action for legal malpractice, Nomura must “establish that [Cadwalader] 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 plaintiff to sustain actual and ascertainable damages” (Dombrowski v Bulson, 19 NY3d 347, 340 [2012] [internal citations and quotations omitted]). An attorney’s conduct or inaction is the proximate cause of a plaintiff’s damages if “but for” the attorney’s negligence “the plaintiff would have succeeded on the merits of the underlying action” (AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434 [2007]), or would not have sustained “actual and ascertainable” damages (Dombrowski, 19 NY3d at 340; Brooks v Lewin, 21 AD3d 731, 734 [1st Dept 2005], lv denied 6 NY3d 713 [2006]). Thus, in order for Cadwalader to prevail on its summary judgment motion, it must establish that it provided the advice, and conducted the due diligence expected of counsel “exercis[ing] the ordinary reasonable skill and knowledge [*8]commonly possessed by a member of the legal profession” (Dombrowski, 19 NY3d at 340). If Cadwalader fell short of this professional standard, it must demonstrate that its conduct was not the proximate cause of Nomura’s damages.”

“Essentially Nomura seeks to have us ignore the fact that it assumed the responsibility for ensuring that the loans complied with the 80% test based on independent appraisals that Cadwalader did not conduct or review. However, we cannot ignore that Nomura chose to run its business in this way, and that Cadwalader acted upon and relied on that business model in its representation of Nomura.

Nomura argues, alternatively, that even if Cadwalader did not have a general duty to confirm Nomura’s representations for all the D5 mortgage loans, it had such a duty in the case of the hospital loan. In support, Nomura relies on testimony from Adelman and Cadwalader’s experts that Cadwalader had a legal responsibility to confirm REMIC qualification where a “red flag” suggested that the appraisal valuation of the real property was inconsistent with Nomura’s representations. Cadwalader concedes this point, but argues that there was nothing in the D5 securitization to require that it confirm Nomura’s representations of REMIC qualification.

Nomura contends that the highlights document was a red flag because it contained statements that the loan was “secured by the land, building, and operations,” and that the collateral for the loan is the “land, building and property management (operations).” Nomura argues that this alerted Cadwalader to the possibility that the appraisal was based on the hospital’s operations, and not land and buildings, as required for REMIC qualification. As a consequence, Cadwalader should have taken steps to confirm that the property satisfied the 80% test.

Despite Nomura’s arguments to the contrary, the fact that the operational part of the hospital business may have factored in some way into the appraisal did not mean that Cadwalader should have considered Nomura’s representations unreliable. After all, the D5 securitization consisted of numerous commercial mortgages, all of which Nomura assessed in accordance with Cadwalader’s advice about how to determine REMIC qualification based on the 80%. Therefore, the hospital mortgage loan was no different from the others.”

“Nomura also argues that Cadwalader should not have ignored the fact that the highlights document includes a cost approach valuation of the hospital that is dangerously close to the 80% REMIC minimum. While it is true that the cost approach valued the hospital property at $40,600,000, that number is still above the $40 million required to meet REMIC qualification. [*12]In any case, and more to the point is the fact that the highlights document placed the hospital’s reconciled appraised value at $68 million, $28 million in excess of the $40 million required under the 80% test. That final appraisal was established only after the reconciliation of the three valuation approaches, two of which (the “income” and “sales” approaches) valued the property at over $60 million. Given such a large differential, Cadwalader did not have a basis to doubt Nomura’s representation that the hospital loan complied with the 80% test. Indeed, Adelman testified that in his experience, even if a property valued at $68 million included a significant amount of personal property, its real property valuation would not fall below $40 million dollars. Gershon similarly testified that in his experience in real estate, a $68 million appraisal based on the income approach (which was the case here) means the real estate value likely exceeded $40 million. Rather than establish that triable issues of fact exist, the evidence instead shows that these parties—sophisticated business entities in the securitization field—held similar views that a $68 million appraisal provided sufficient confidence that the property was REMIC-qualified.

Cadwalader, thus, met its burden to establish that it conducted the requisite due diligence, and that it “exercise[d] the ordinary and reasonable skill and knowledge commonly possessed by a member of the legal profession” when it relied on Nomura’s representations in issuing an opinion that the D5 securitization was REMIC-qualified (see Dombrowski, 19 NY3d at 340). In contrast, Nomura failed to meet its burden to establish the existence of a triable issue of fact.

For the foregoing reasons, the Appellate Division’s order should be modified, with costs to Cadwalader, by granting Cadwalader’s motion for summary judgment dismissing the first cause of action in its entirety and, as so modified, affirmed and the certified question answered in the negative.”

For this fine October day, we employ a baseball catch-phrase.  Defendants moved for summary judgment saying that plaintiffs could not prove at least one of the elements of legal malpractice.  Plaintiffs demonstrated that they could prove at least one of their claims.  Result?  The case went on to settlement.  Smith v Kaplan Belsky Ross Bartell, LLP  2015 NY Slip Op 02108 [126 AD3d 877]  March 18, 2015 Appellate Division, Second Department is a demonstration that if you wish to succeed at summary judgment, all bases must be covered.

“Ordered that the order is modified, on the law, by deleting the provision thereof granting that branch of the defendants’ motion which was for summary judgment dismissing the cause of action alleging legal malpractice, and substituting therefor a provision denying that branch of the motion; as so modified, the order is affirmed, with costs to the plaintiffs.

The plaintiffs were former executives of Odyssey Pictures Corporation (hereinafter Odyssey) and members of its Board of Directors. Upon their departure from Odyssey, the plaintiffs were given an agreement pursuant to which Odyssey promised to indemnify them in future litigation arising out of their tenure with Odyssey. At some point thereafter, the plaintiffs were sued for actions arising during their tenure with Odyssey. The plaintiffs allegedly evaluated their likelihood of being indemnified by Odyssey and based their litigation strategy in that action upon their belief that they would be indemnified by Odyssey for their litigation costs. At the end of the litigation against them, the plaintiffs sought approximately $455,000 in indemnification from Odyssey, at which time the plaintiffs learned that Odyssey did not have the assets portrayed in the financial reports prepared by Odyssey’s accountants, Want & Ender. In or about February 2004, the plaintiffs retained the defendants to prosecute an action against Want & Ender, and in or about April and June 2004, Want & Ender was served with a summons and notice. Want & Ender failed to answer or appear. However, the defendants did not move for a default judgment in the plaintiffs’ favor and against Want & Ender within a year of that default and, instead, moved for that relief about three years later. The plaintiffs’ action against Want & Ender was ultimately dismissed as abandoned.”

“The defendants failed to establish their prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging legal malpractice (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]). While the defendants argue that the plaintiffs could not have recovered on their action against Want & Ender because the plaintiffs were not in privity or near privity with Want & Ender (see Health Acquisition Corp. v Program Risk Mgt., Inc., 105 AD3d 1001, 1003 [2013]; Barrett v Freifeld, 64 AD3d 736, 738 [2009]), their submissions failed to eliminate all triable issues of fact with respect to this issue (cf. Security Pac. Bus. Credit v Peat Marwick Main & Co., 79 NY2d 695, 702 [1992]). In support of their motion, the defendants submitted, inter alia, the deposition testimony of the plaintiffs, who testified as to when and how they relied on the improperly prepared financial reports, and explained why they believed that the accountants knew or should have known that the plaintiffs would be relying on the prepared financial reports. Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging legal malpractice, that branch of the defendants’ motion should have been denied, regardless of the sufficiency of the papers submitted in opposition (see Winegrad v New York Univ. Med. Ctr., 64 NY2d at 853; Delollis v Margolin, Winer & Evens, LLP, 121 AD3d 830 [2014]).”

Would a medical malpractice case be dismissed because the patient said (when coming out of anesthesia) that the surgeon seemed great?  Would an accounting malpractice case be dismissed when the client said that the numbers looked good?  No.  But legal malpractice cases (all in the matrimonial area) are being dismissed when the client is told (by his attorney) to say that he was “satisfied” with the representation at the settlement allocution.  By the way, when else is a settlement “allocuted” on the record?  Never.

Goldweber Epstein, LLP v Goldberg  2015 NY Slip Op 31916(U) October 14, 2015 Supreme Court, New York County Docket Number: 650807/2015 Judge: Cynthia S. Kern is the latest example in the Harvey line.

“On or about March 16, 2015, plaintiff commenced this fee action against defendant seeking to recover the alleged $49,464.65 in legal fees. In response, defendant served an answer asserting a counterclaim against plaintiff sounding in legal malpractice. Specifically, defendant alleges plaintiff: (a) failed to conduct adequate discovery regarding the defendant’s wife’s financial interests; (b) failed to competently negotiate two settlement agreements; (c) failed to competently negotiate a settlement spread on the record; ( d) incorrectly insisted that the “status quo” formula maintained for over 3 years was to defendant’s benefit; (e)’failed to understand the matrimonial part of Westchester County and the imminent withdrawal of Judge Wood; (f) wasted thousands of dollars in retaining a separate financial expert to assist plaintiff inasmuch as plaintiff could not understand the most basic financial concept; (g) lacked the ability to understand or explain the terms of a promissory note with an “equity kicker”; (h) lacked the ability to comprehend a law firm partnership agreement; and (i) refused;,despite persistent inquires by defendant, to address the financial impact of supporting a dis’abled daughter. Plaintiff now moves to dismiss this counterclaim. ”

“In the present case, plaintiff’s motion for an Order pursuant to CPLR § 3211 (a)(l) dismissing defendant’s counterclaim for malpractice is granted as the documentary evidence presented by plaintiff definitively disposes of defendant’s counterclaim. According to the First Department, “[a] claim for legal malpractice is viable, despite settlement of the underlying action, if it is alleged that settlement of the action was effectively compelled by the mistakes of counsel.” Bernstein v. Oppenheim, 160 A.D.2d 428, 430 (pt Dept 1990). However, courts have consistently held that where a client performs an allocution and acknowledges that he or she is satisfied with an attorney’s performance, there is no viable malpractice claim. See Harvey v. Greenberg, 82 A.D.3d 683, 683 (I5t Dept 2011); Weissman v. Kessler, 78 A.D.3d 465, 465- 466 (pt Dept 2010); Kate bi v. Fink, 51 A.D.3d 424, 425 (1st Dept 2008). Here, defendant allocuted in open Court that he was satisfied with the settlement of the Matrimonial Action and plaintiffs representation. Indeed, when explicitly asked by Justice Christopher “[a]re you … 3 [* 3] satisfied with the respective attorneys,” defendant responded with “Yes.” Thus, this allocution clearly contradicts defendant’s allegation of malpractice and defendant’s. counterclaim must be dismissed. Accordingly, plaintiffs motion is granted and it is hereby ORDERED that defendant’s counterclaim for malprac.tice is dismissed. This constitutes the decision and order of the court. “

Clients suing pro-se took two appeals from the denial of a motion for a default judgment.  Second appeal, which ate up quite a bit of time was dismissed, since one may not appeal from denial of a motion to re-argue.  Sometimes, even when you are suing an attorney, it just makes sense to hire an attorney?

Executor of N.Y. Estate of Celia Kates v Pressly  2015 NY Slip Op 07469  Decided on October 14, 2015  Appellate Division, Second Department tells us that appeals have a number of unique rules.

“In an action to recover damages for a violation of Judiciary Law § 487, the plaintiffs appeal, as limited by their brief, from so much of an order of the Supreme Court, Nassau County (Diamond, J.), dated June 7, 2013, as denied their second motion, in effect, for leave to reargue their prior motion for the entry of a default judgment against the defendants, which was denied in an order of the same court dated August 23, 2010.

DECISION & ORDER

Cross motion by the defendants, inter alia, to dismiss the appeal on the ground that no appeal lies from an order denying reargument. By decision and order on motion of this Court dated June 24, 2014, that branch of the cross motion which is to dismiss the appeal was held in abeyance and referred to the Justices hearing the appeal for determination upon the argument or submission thereof, and the cross motion was otherwise denied.

Upon the papers filed in support of the cross motion, the papers filed in opposition thereto, and upon the submission of the appeal, it is

ORDERED that the branch of the cross motion which is to dismiss the appeal is granted; and it is further,  ORDERED that the appeal is dismissed, with costs.

The appeal must be dismissed, as no appeal lies from an order denying reargument (see Emigrant Mtge. Co., Inc. v Thevenin, 127 AD3d 919; Basile v Wiggs, 117 AD3d 766, 766; Naso v Naso, 102 AD3d 755, 756; Rosenfeld v Baker, 78 AD3d 810, 811; Peralta v All Weather Tire Sales & Serv., Inc., 58 AD3d 823, 823).”