Courts reserve the application of Judiciary Law 487, the Attorney Deceit Law to very few cases.  Put another way, courts are loathe to apply it.  In Kuruwa v 130E. 18 Owners Corp. 2014 NY Slip Op 06880 Decided on October 9, 2014  the Appellate Division, First Department merely sweeps the question away in a very short opinion.

"The IAS court correctly found that respondent bank’s perfected, secured interest in the subject property has priority over petitioners’ unsecured money judgment (see Chrysler Credit Corp. v Simchuk , 258 AD2d 349 [1st Dept 1999]). The bank’s false answers to the information subpoena, in which it denied having a mortgage on the Meyers respondents’ apartment, did not prejudice petitioners; nor do they point to any detrimental reliance upon the statements (cf. Leber-Krebs, Inc. v Capitol Records , 779 F2d 895, 896 [2d Cir 1985]).

The court also correctly held that there could be no judicial sale of the cooperative apartment. The Meyers defendants had purchased the co-op before they were married, and they concede that they originally owned it as tenants in common (see EPTL 6-2.2). They refinanced the purchase money mortgage after they were married, and the bank required a name change on a newly issued stock certificate and proprietary lease. The change in title, made by the cooperative corporation, after the parties were married effectively changed ownership from tenants in common to tenants by the entirety.

The legal arguments made by the bank’s counsel and the Meyerses’ counsel do not give rise to claims under Judiciary Law § 487."

Client buys some gas stations and believes that it was unfairly kept from sharing in some condemnation awards on the property that mostly (or all) went to seller.  Client sues attorneys for not obtaining the unpaid condemnation awards.  Defendants claim it was strategy.  Result?

In Leon Petroleum, LLC v Carl S. Levine & Assoc., P.C.  2014 NY Slip Op 07632  Decided on November 12, 2014  the Appellate Division, Second Department determined that this was strategy and not a simple mistake.  The standard?

"To establish a cause of action alleging legal malpractice, a plaintiff must show that the attorney failed to exercise the care, skill, and diligence commonly possessed and exercised by a member of the legal profession, and that such negligence was a proximate cause of the actual damages sustained (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442; Frederick v Meighan, 75 AD3d 528, 531). Under the attorney judgment rule, "selection of one among several reasonable courses of action does not constitute malpractice" (Rosner v Paley, 65 NY2d 736, 738; see Ackerman v Kesselman, 100 AD3d 577; Bua v Purcell & Ingrao, P.C., 99 AD3d 843, 847). "To establish entitlement to the protection of the attorney judgment rule, an attorney must offer a reasonable strategic explanation’ for the alleged negligence" (Ackerman v Kesselman, 100 AD3d at 579, quoting Pillard v Goodman, 82 AD3d 541, 542). "To establish causation, a plaintiff must show that he or she would have prevailed in the underlying action or would not have incurred any damages, but for the lawyer’s negligence" (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 442; see Blanco v Polanco, 116 AD3d 892, 894).

Here, the defendants established their entitlement to judgment as a matter of law by demonstrating that the failure to draft clear, specific, and unambiguous language in an agreement for the purchase of assets, so as to provide that the subject assets included certain unpaid condemnation awards, was a reasonable strategic decision taken to avoid an increase in the purchase price, and that the drafting of more specific language would not have resulted in the inclusion of the condemnation awards in the sale without an increase in the purchase price. In opposition, the plaintiffs failed to raise a triable issue of fact with respect to either element of the legal malpractice cause of action (see Zuckerman v City of New York, 49 NY2d 557, 562). "A mere hope . . . that somehow or other on cross examination credibility of a witness . . . can be put in issue is not sufficient to resist a motion for summary judgment’" (Trails W. v Wolff, 32 NY2d 207, 221, quoting Hurley v Northwest Publ. Inc., 273 F Supp 967, 974 [D Minn], affd 398 F2d 346 [8th Cir]; see Angeles v Goldhirsch, 268 AD2d 217). Accordingly, the Supreme Court properly granted the defendants’ motion for summary judgment dismissing the complaint (see Rodriguez v Lipsig, Shapey, Manus & Moverman, P.C., 81 AD3d 551, 552; Noone v Stieglitz, 59 AD3d 505, 507)."

Here is the story of an attorney who is retained to commence an underinsured motorist arbitration against an auto insurance carrier.  Apparently he makes the claim for arbitration, becomes suspended from the practice of law, (later disbarred) and watches while another attorney settles the claim for the clients.  is he due a fee, and did the other attorney violate JL 487?

As to the JL 487 claim, there was no violation.  We cannot tell anything about the JL 487 claim because the AD’s entire decision on this issue is:  "The Cassar defendants also showed that the plaintiff does not have a cause of action against them pursuant to Judiciary Law § 487 (see Judiciary Law § 487)."

As to attorney fees after termination, some explanation was given:

"In addition, the court properly determined that the plaintiff was not entitled to any attorney’s fees from the Pogue defendants. A client has the right to discharge his or her attorney at any time (see Campagnola v Mulholland, Minion & Roe, 76 NY2d 38, 43; Schultz v Hughes, 109 AD3d 895, 896; Doviak v Finkelstein & Partners, LLP, 90 AD3d 696, 698). While an attorney who is discharged without cause before the completion of services may recover the reasonable value of his or her services in quantum meruit, an attorney who is discharged for cause is not entitled to any compensation or lien (see Campagnola v Mulholland, Minion & Roe, 76 NY2d at 44; Doviak v Finkelstein & Partners, LLP, 90 AD3d at 699; Callaghan v Callaghan, 48 AD3d 500, 500-501). Here, the court held a hearing pursuant to 22 NYCRR 603.13(b) with respect to the plaintiff’s cross motion for attorney’s fees. The court determined that the plaintiff was properly discharged for cause, and, therefore, was not entitled to recover in quantum meruit. The plaintiff does not argue that the evidence at the hearing was insufficient to support the court’s determination. Thus, the evidence submitted by the Pogue defendants disproved the essential allegation of the complaint, i.e., that the plaintiff was not properly discharged for cause, and established that the plaintiff does not have a cause of action to recover attorney’s fees from the Pogue defendants (see generally Campagnola v Mulholland, Minion & Roe, 76 NY2d 38; Schultz v Hughes, 109 AD3d 895; Doviak v Finkelstein & Partners, LLP, 90 AD3d 696). Therefore, the Supreme Court properly dismissed the complaint insofar as asserted against the Pogue defendants."

 

A theme that is becoming somewhat popular is that of a Judiciary law 487 claim when counsel moves to be relieved.  Often, the attorney uses stock phrases (refusal to pay expenses, conflict over strategy, inability to communicate) while the plaintiff urges that the attorney is making this up in order to be rid of a troublesome case.  Attorneys have been held in Judiciary Law 487 cases on the basis that the client was actually up to date on payments. 

Here, in Brady v Friedlander  2014 NY Slip Op 06677  Decided on October 2, 2014  Appellate Division, First Department we see that Civil Court’s decision to allow the attorney to withdraw guts the Judiciary law 487 claim. 

"On or about September 30, 2009, defendant moved in Civil Court, New York County (Samuels, J.), to withdraw as counsel in the underlying nonpayment proceedings (see IGS Realty Co., L.P. v James Catering, Inc., 99 AD3d 528 [1st Dept 2012]). Over plaintiffs’ objection, the court granted the motion. Plaintiffs did not appeal from Civil Court’s order. With respect to the cause of action for a violation of Judiciary Law § 487, the instant complaint alleges that defendant provided fabricated grounds in support of his motion, to wit, a conflict with plaintiffs regarding strategy and a lack of trust in defendant’s representation, in order to conceal the true reason, which was an unfounded belief that plaintiffs could or would not pay future legal bills. However, while the parties’ communications as quoted in the complaint reflect that defendant was remarkably concerned with billing, which may have informed his decision to withdraw, the complaint also reflects that plaintiff Brady expressed disagreement with defendant as to strategy and questioned defendant’s honesty and competency, thus providing support for defendant’s stated grounds for the motion (cf. Palmieri v Biggiani, 108 AD3d 604 [2d Dept 2013]).

In granting the motion, over plaintiffs’ objection, Civil Court implicitly determined that defendant had shown "just cause" to be relieved. That issue may not be re-litigated via the instant misrepresentation claim (cf. Hass & Gottlieb v Sook Hi Lee, 11 AD3d 230 [1st Dept 2004]).

"

One may not sue the opponent’s attorney for legal malpractice, except for a very few and limited number of exceptions, yet the temptation to do so must be very high in matrimonial cases.  One tactic in custody proceedings is the false accusation of misconduct.  The wrongfully accused spouse would love to sue the other spouse’s attorney.  Here, in Tenore v Kantrowitz, Goldhamer & Graifman, P.C.  2014 NY Slip Op 06811  Decided on October 8, 2014  Appellate Division, Second Department the case failed.

"The plaintiff commenced this action against the defendant law firm, which represented his former wife in a matrimonial action against him, alleging a violation of Judiciary Law § 487, fraud, and abuse of process. The plaintiff alleged, inter alia, that the defendant included in the underlying matrimonial action a cause of action to recover damages for assault that was without any factual basis, in an attempt to extract additional money from him in the course of that litigation. The defendant moved for summary judgment dismissing the complaint in the instant action, and the plaintiff cross-moved for leave to amend that complaint to add causes of action to recover damages for a violation of General Business Law § 349, prima facie tort, and malicious prosecution. The Supreme Court granted the defendant’s motion and denied the plaintiff’s cross motion.

The Supreme Court properly granted that branch of the defendant’s motion which was for summary judgment dismissing the cause of action alleging a violation of Judiciary Law § 487. The defendant demonstrated its prima facie entitlement to judgment as a matter of law by establishing its lack of intent to deceive (see Dupree v Voorhees, 102 AD3d 912, 913). In opposition, the plaintiff failed to raise a triable issue of fact."

Evedentaily, defendants made a well-intentioned but insufficient motion for summary judgment.  In this wrongful eviction case, the landlord turned to its attorney and made a legal malpractice claim.  Defendants moved to dismiss, but in Morad Assoc., LLC v Jay Sung Lee 2013 NY Slip Op 08204 [112 AD3d 463] December 10, 2013 Appellate Division, First Department  they could not convince the AD that all damages flowed from the landlord and none from the attorney.

"The evidence submitted by defendant attorney, while showing that he may not be liable for a large measure of the damages assessed against plaintiff, failed to establish as a matter of law that his alleged negligence was not the cause of at least some of those damages. In addition to the damage to the property of plaintiff’s tenant, plaintiff was also assessed damages for wrongful eviction for which defendant may be held liable. We find no basis for holding defendant liable for any damages plaintiff incurred when its agents destroyed the tenant’s property. Concur—Tom, J.P., Friedman, Acosta and Moskowitz, JJ."

The typical triumvirate of claims in a legal malpractice setting is Legal Malpractice, Breach of Contract and Breach of Fiduciary Duty.  Defendants almost always move to dismiss the second and third claims on the basis that they duplicate the legal malpractice claim and must be dismissed as "duplicitive."

in Chowaiki & Co. Fine Art Ltd. v Lacher  2014 NY Slip Op 01992 [115 AD3d 600]  March 25, 2014
Appellate Division, First Department  we see the First Department noting that plaintiffs need not "elect their remedies."   As might be surmised, the two principals, duplication and election of remedies stand in stark contract to each other.

"In this action arising from defendant attorney and his law firm’s representation of plaintiffs in an action brought against them by a former employee, plaintiffs allege that they were excessively billed for services rendered, and that they were harassed, threatened and coerced into paying the excessive and overinflated fees. The motion court properly dismissed plaintiffs’ claim for breach of fiduciary duty as duplicative of the breach of contract claim, since the claims are premised upon the same facts and seek identical damages, return of the excessive fees paid (see CMMF, LLC v J.P. Morgan Inv. Mgt. Inc., 78 AD3d 562 [1st Dept 2010]; cf. Ulico Cas. Co. v Wilson, Elser, Moskowitz, Edelman & Dicker, 56 AD3d 1 [1st Dept 2008]). Although plaintiffs sufficiently allege an independent duty owed to them, arising from the attorney-client relationship, the fraud claim is similarly redundant of the breach of contract claim, since it also seeks the same damages (see Coppola v Applied Elec. Corp., 288 AD2d 41, 42 [1st Dept 2001]; Makastchian v Oxford Health Plans, 270 AD2d 25, 27 [1st Dept 2000]).

However, we find that, as a dispute exists as to the application of the retainer agreement as to defendant, plaintiffs need not elect their remedies and may pursue a quasi-contractual claim for unjust enrichment, as an alternative claim (see Wilmoth v Sandor, 259 AD2d 252, 254 [1st Dept 1999]).

 

Plaintiffs’ claims of excessive billing and related conduct, which actions are not alleged to have adversely affected their claims or defenses in the underlying action, do not state a claim for legal malpractice (see e.g. AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434 [2007])."

Judiciary Law 487 is a ancient attorney deceit statute which says, in essence, that it is a violation (and a misdemeanor) for an attorney to engage in deceit.  The statute is subject to the requirement to prove proximate cause as well as ascertainable damages. 

in Mizuno v Nunberg  2014 NY Slip Op 07481  Decided on November 5, 2014  Appellate Division, Second Department  the AD affirmed Supreme Court’s dismissal of the case.

"In 1994, a nonparty bank commenced a mortgage foreclosure action against the plaintiff. The plaintiff thereafter filed several bankruptcy petitions in the United States Bankruptcy Court for the Eastern District of New York, which were ultimately unsuccessful in preventing the foreclosure sale of the plaintiff’s real property, which was conducted in 2002. The plaintiff then commenced a legal malpractice action (hereinafter the first legal malpractice action) against the attorney and the law firm who represented him in his third bankruptcy proceeding. The plaintiff prevailed in the first legal malpractice action, and was awarded the relief he sought in the complaint, entitling him to recover the value of the equity he lost in the real property as a consequence of the foreclosure sale, as well as the legal fees he incurred in securing that recovery (see Mizuno v Fischoff & Assoc., 82 AD3d 849).

In August 2011, the plaintiff commenced an action against Shari Barak, the attorney who represented the bank in the foreclosure proceedings, who testified at the nonjury trial of the first legal malpractice action, as well as the law firm in which Barak is a partner (hereinafter the second legal malpractice action). The plaintiff alleged that Barak and her law firm violated Judiciary Law § 487 and committed fraud and legal malpractice in filing an allegedly false and misleading notice of default and an affidavit of noncompliance in the third bankruptcy proceeding, and in giving false testimony in the first legal malpractice action as to the plaintiff’s default on mortgage payments. The defendants moved pursuant to CPLR 3211(a) to dismiss the complaint in the second legal malpractice action, and the Supreme Court granted the motion. We affirmed, determining, inter alia, that the plaintiff failed to state a cause of action (see Mizuno v Barak, 113 AD3d 825).

While the appeal in the second legal malpractice action was pending, the plaintiff commenced the instant action against Noah Nunberg, the attorney who represented the defendants in the first legal malpractice action, as well as Nunberg’s law firm (hereinafter together the defendants). The plaintiff alleged that the defendants likewise violated Judiciary Law § 487 and [*2]committed fraud and legal malpractice in allowing Barak to give what they knew was false testimony during the first legal malpractice action, thereby suborning perjury. The defendants moved pursuant to CPLR 3211(a) to dismiss the complaint, and requested that a letter from the Grievance Committee for the Tenth Judicial District to the plaintiff, dated June 21, 2012 (hereinafter the Grievance Committee letter), responding to a complaint made by the plaintiff, be removed from the court’s file. The Supreme Court granted the motion.

The plaintiff failed to state a cause of action against the defendants to recover damages for violation of Judiciary Law § 487, fraud, or legal malpractice. Accepting as true the facts alleged in the complaint, and according the plaintiff the benefit of every favorable inference (see Leon v Martinez, 84 NY2d 83, 87-88), he failed to " plead allegations from which damages attributable to the [defendants’ conduct] might be reasonably inferred’" (Mizuno v Barak, 113 AD3d at 827, quoting Rock City Sound, Inc. v Bashian & Farber, LLP, 74 AD3d 1168, 1171; see Markel Ins. Co. v American Guar. & Liab. Ins. Co., 111 AD3d 678; Regina v Marotta, 67 AD3d 766). As we determined in Mizuno v Barak, the plaintiff obtained the relief to which he was entitled in the first legal malpractice action, despite Barak’s alleged false testimony (see id. at 827). Moreover, the litigation costs associated with the first legal malpractice action cannot reasonably be attributed to any alleged false trial testimony given by Barak, or, by extension, by the defendants’ conduct as counsel to the plaintiff’s adversaries (see id.). Accordingly, the Supreme Court properly directed the dismissal of the complaint in the instant action."

We’ve noted that more legal malpractice cases seem to be dismissed on CPLR 3211 grounds than those in other fields of the law.  Endless Ocean, LLC v Twomey, Latham, Shea, Kelley, Dubin & Quartararo  2014 NY Slip Op 00087 [113 AD3d 587]  January 8, 2014  Appellate Division, Second Department looks like on of them. 

In this straightforward claim, plaintiffs retained attorneys to manage a 1031 Like-Kind exchange of real property, which would defer capital gain taxes.  One must arrange for an uninvolved 3d party to receive the sale proceeds and withhold them until a purchase of new property.  This did not happen.  Instead, Plaintiffs were drawn into an unrelated bankruptcy and lost significant amounts of money.

"The plaintiff commenced this action to recover damages allegedly sustained as a result of the defendants’ legal malpractice. As alleged in the complaint, the plaintiff retained the defendants to represent it in connection with the sale of certain real property and a related exchange of "like-kind property" pursuant to the Internal Revenue Code (see 26 USC § 1031). According to the allegations in the complaint, the plaintiff, based upon the defendants’ advice, selected LandAmerica 1031 Exchange Services, Inc. (hereinafter LandAmerica), as the qualified intermediary to hold a portion of the sale proceeds, totaling $5.5 million, for the exchange of like-kind property pursuant to 26 USC § 1031. The complaint alleged, inter alia, that the defendants negligently represented the plaintiff inasmuch as they reviewed, and advised the plaintiff to execute, an agreement with LandAmerica, under which the exchange funds were to be held in a commingled [*2]account and not a qualified escrow account or trust. Soon after the sale proceeds were transferred to LandAmerica, its parent corporation, LandAmerica Financial Group, Inc., declared bankruptcy. According to the complaint, the plaintiff’s funds were frozen for several years during the bankruptcy proceedings, and the plaintiff lost a portion of the funds because they were not held in a qualified escrow account or trust. The complaint further alleged that the plaintiff could not defer the taxes on the capital gains from the initial sale, as it did not have access to its funds to purchase a replacement property within the required 180-day period.

Prior to answering, the defendants moved to dismiss the complaint pursuant to CPLR 3211 (a) (1) based on documentary evidence, and pursuant to CPLR 3211 (a) (7) for failure to state a cause of action. The Supreme Court granted the defendants’ motion to dismiss the complaint on both grounds.

The Supreme Court improperly granted the defendants’ motion to dismiss the complaint based on documentary evidence. A motion to dismiss a complaint pursuant to CPLR 3211 (a) (1) may be granted only if the documentary evidence submitted by the moving party utterly refutes the factual allegations of the complaint, "conclusively establishing a defense as a matter of law" (Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]). Here, the retainer agreement submitted by the defendants did not conclusively establish a defense as a matter of law (see Harris v Barbera, 96 AD3d 904, 905-906 [2012]; Rietschel v Maimonides Med. Ctr., 83 AD3d 810, 811 [2011]; Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34, 38-39 [2006])."

We’ve said that legal malpractice issues are ubiquitous, and omnipresent.  That’s just another way of saying that where there are lawyers, and where they practice their human crafts, there will be mistakes and shortcomings.  This was true before the Magna Carta and is true today. 

One example of the evolving nature of legal malpractice issues is the Internet. Predictable only in science fiction, the Internet has come to color every part of our lives.  Use of the Internet in the age-old practice of trial law has set new standards.  So reports Anthony E. Davis in the New York Law Journal.  While he discusses the ethical issue of how one might correctly research jurors now sitting at a trial, he raises the point that failure to investigate may be legal malpractice.

"Duty to Investigate
The first question to be addressed is whether lawyers are under any duty to conduct any investigation of jurors. City Bar 2012-2 looked at this in the second segment of the opinion, including the following observation:
Lawyers have even been chastised for not conducting such research on potential jurors. For example, in a recent Missouri case, a juror failed to disclose her prior litigation history in response to a voir dire question. After a verdict was rendered, plaintiff’s counsel investigated the juror’s civil litigation history using Missouri’s automated case record service and found that the juror had failed to disclose that she was previously a defendant in several debt collection cases and a personal injury action. (Footnote omitted). Although the court upheld plaintiff’s request for a new trial based on juror nondisclosure, the court noted that "in light of advances in technology allowing greater access to information that can inform a trial court about the past litigation history of venire members, it is appropriate to place a greater burden on the parties to bring such matters to the court’s attention at an earlier stage." Johnson v. McCullough, 306 S.W.3d 551, 558-59 (Mo. 2010). The court also stated that "litigants should endeavour to prevent retrials by completing an early investigation." Id. at 559.
Earlier, in the introduction to the opinion, the city bar went even further, stating that: "Indeed, standards of competence and diligence may require doing everything reasonably possible to learn about the jurors who will sit in judgment on a case."
Notably, ABA 466 is in agreement with this proposition. In footnote 3, ABA 466 cites to this statement in City Bar 2012-2 and to other sources, including Comment [8] to Model Rule 1.1, to the Johnson v. McCullough decision (supra), and to N. H. Bar Ass’n, Op. 2012-13/05, which, in common with Comment 8 to Model Rule 1.1, addresses attorneys’ obligation "to be aware of social media as a source of potentially useful information in litigation, to be competent to obtain that information directly or through an agent, and to know how to make effective use of that information in litigation."