As is true of many other things, this story started with mismanaged money.  The original problem was exacerbated by mismanaged litigation.  in Gordon v Barrett  2014 NY Slip Op 51431(U)
Decided on September 30, 2014  Supreme Court, Kings County  Schmidt, J. plaintiff originally had money problems. 

"Plaintiff Gloria Gordon (plaintiff [FN1] ) maintains that, in 2002, she unwittingly and under false pretenses conveyed title to her six-family house at 646 East 96th Street in Brooklyn (Block 4755, Lot 69) (the property) to a Malco entity for a fraction of its value and became Malco’s tenant under a lease which contained an option for her to buy back her property at a stated price, but that Malco refused to honor the option and sold her property in Oct. 2012 to defendant 646 East 96 Street Associates, LLC (Associates). As part of this action, she sought to file a notice of pendency, dated Oct. 3, 2013, against the property. The County Clerk initially declined to accept her notice for filing because of a previously expired and vacated notice of pendency (a lapsed notice of pendency) she filed in connection with her 2004 action against Malco under index No. 19828/04 for specific performance of the sale/leaseback agreement and for a declaration that she was the true owner of the property (the prior action). On Oct. 8, 2013, the County Clerk, in accordance with an unopposed order to show cause of the same date, accepted for filing plaintiff’s notice of pendency, pending a hearing on plaintiff’s motion in Seq. No. 2 to deem such notice valid and effective. In addition, presently before the Court are two pre-answer motions to dismiss, one in Seq. No. 4 served by Associates, and the other in Seq. No. 3 served by plaintiff’s former counsel Clover Barrett, Esq. (Barrett [FN2] ) in the prior action.

Associates’ fourth and final argument for dismissal is that plaintiff’s complaint fails to state a cause of action against it under CPLR 3211 (a) (7). Associates posits that it is a bona fide purchaser for value because, when it recorded its deed to the property from Malco, the notice of pendency in the prior action had already lapsed and plaintiff’s sale/leaseback agreement with Malco was never recorded. Associates’ position raises a threshold question of whether, at the time of its purchase of the property, it was chargeable with constructive or inquiry notice of plaintiff’s competing claim by virtue of her lapsed notice of pendency.

"At common law, the doctrine of lis pendens provided that any person who purchased real property that was the subject of litigation was presumed to have constructive notice of the dispute and was bound by the judgment in the action as if he or she were a party to it" (Kolel Damsek Eliezer, Inc. v Schlesinger, 90 AD3d 851, 855 [2d Dept 2011], lv dismissed 19 NY3d 919 [2012]). Thus, a search of all court records was required under the common-law lis pendens doctrine to determine whether real property in which a purchaser sought an interest was the subject of pending litigation (id.). Because this cumbersome process of searching through court records was seen as an intolerable burden effectively restraining alienation of real property, "the common-law lis pendens doctrine was replaced in most states by statutes requiring the filing of a notice of pendency before a would-be purchaser . . . would be charged with notice of the prior interest" (Matter of Sakow, 97 NY2d 436, 440-441 [2002] [internal citation omitted]).[FN3] This reduced the harshness of the former [*4]common-law rule because the notice of pendency is now filed with the records pertaining to the real property itself, and third persons are chargeable with knowledge only of what appears in the records filed in the central registry (see Kolel Damsek Eliezer, Inc., 90 AD3d at 855-856). The primary purpose of the notice of pendency procedure set forth in CPLR article 65 is to furnish a substitute for actual notice of pending litigation (see Da Silva, 76 NY2d at 442).

On the other hand, once a notice of pendency expires, or is vacated or canceled, it is considered to be a "nullity" — a "void" that cannot be filled (see Sakow, 97 NY2d at 442).[FN4] The authorities are nearly uniform in their conclusion that a lapsed notice of pendency in a subsisting action does not impart inquiry notice to a prospective purchaser despite his or her actual knowledge of the lapsed notice of pendency (see Polish Natl. Alliance of Brooklyn, U.S.A. v White Eagle Hall Co., 98 AD2d 400, 405 [2d Dept 1983] [a lapsed notice of pendency could not affect the rights of contract vendees who acquired their interest in the property after the notice lapsed]; Walter v State Bank of Albany, 73 AD2d 406, 408 [3d Dept 1980] [an expired notice of pendency had no effect as to the parties acquiring and/or perfecting an interest in real property after its expiration]; Bankers Trust Co. of Cal., N.A. v Bok, 26 Misc 3d 1203[A], 2009 NY Slip Op 52650[U] [Sup Ct, NY County] ["A Notice of Pendency . . . only serves as constructive notice while it is valid. . . . In the case at bar, there was only one Notice of Pendency, which . . . expired long before (the property buyer) obtained title."] [internal citations omitted]; but see Schoepp v State of NY, 69 AD2d 917, 917 [3d Dept 1979] [the defendant was responsible for determining the disposition of the action in which the lis pendens was filed but later expired]).

In conclusion, Barrett’s motion can be quickly disposed. However denominated in the complaint, plaintiff’s claims against Barrett sound in legal malpractice and, as such, are time-barred by the three-year statute of limitations, considering that Barrett’s representation of plaintiff in the prior action ended no later than Feb. 27, 2009, when Barrett was relieved by court order entered on consent of plaintiff’s successor counsel (see Biberaj v Acocella, 2014 NY Slip Op 06165 [2d Dept]).[FN10] Plaintiff’s claims against Barrett are also barred by the doctrine of res judicata because in a separate action under index No. 4960/09 instituted by Barrett against her for unpaid legal fees arising from Barrett’s representation of her in the prior action, the Appellate Division, Second Department (at 90 AD3d 973 [2011]), upheld Barrett’s default judgment against her. "

Privity, schmivity.  The Appellate Division recently decided this legal malpractice case arising out of the intellectual property case involving the comic Buck Rogers.  Does it matter whether the Trust actually hired the law firm?  No.  The Trust is liable anyway.  Can the Trust sue for legal malpractice? No.  The claims are too speculative.

Fross, Zelnick, Lehrman & Zissu, P.C. v Geer  2014 NY Slip Op 06547  Decided on September 30, 2014  Appellate Division, First Department tells us that when a bill is sent, and no objection made, that’s basically the end of the inquiry.

"The Dille Family Trust (the Trust), of which defendant is trustee, owned trademarks and copyrights for "Buck Rogers." Two of the Dille family members are beneficiaries of the trust; their grandfather’s syndicate had obtained the Buck Rogers trademark and copyrights. The syndicate had hired Philip Nowlan to create comic strips based on the character, and his heirs started cancellation proceedings to terminate the syndicate’s trademark rights and obtain the rights for themselves. The beneficiaries of the Trust retained plaintiff law firm to handle intellectual property matters, including the cancellation action.

Contrary to the motion court’s conclusion, there was a valid fee agreement between plaintiff and the Trust. The better practice would have been to send the engagement letter to the trustee, rather than only to the beneficiaries. However, the record, including email exchanges between the trustee and plaintiff, shows that the trustee was well aware of and approved of the beneficiaries’ authority to act on the Trust’s behalf with regard to plaintiff’s retainer and representation (see Granato v Granato, 75 AD3d 434 [1st Dept 2010]). It is irrelevant that the original engagement letter was not signed by the client (see 22 NYCRR 1215.1[a]).

Defendant’s timely written objection to plaintiff’s invoice dated August 25, 2009, for the period ending July 31, 2009, creates triable issues of fact as to the amount due under that invoice only. Defendant’s oral and undocumented objections to the remaining bills do not suffice to create triable issues as to the remaining amount owed (see Brill & Meisel v Brown, 113 AD3d 435, 437 [1st Dept 2014]; see also Darby & Darby v VSI Intl., 95 NY2d 308, 315 [2000]). Moreover, the Trust made partial payments to plaintiff throughout plaintiff’s representation (see [*2]Levisohn, Lerner, Berger & Langsam v Gottlieb, 309 AD2d 668 [1st Dept 2003], lv denied 1 NY3d 509 [2004]).

Regarding the legal malpractice counterclaim, assuming that plaintiff’s conduct, in failing to complete a chain-of-title report or failing to resolve the underlying intellectual property disputes before withdrawing, amounts to negligence, the Trust failed to demonstrate causation. The Trust failed to show how it would have successfully opposed the underlying trademark cancellation proceeding, or would otherwise have protected its intellectual property rights, but for plaintiff’s omissions (see AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428 [2007]; Leder v Spiegel, 31 AD3d 266 [1st Dept 2006], affd 9 NY3d 836 [2007], cert denied 552 US 1257 [2008])."

Town of Amherst hires attorneys to represent them in the termination of an employee. Time goes by  Things go wrong.  Attorneys are hired again (rehired?) to continue to represent the Town. Time goes by.  Attorneys are once again hired.  When the case is finally lost, the Town sues the attorneys.  Continuous representation?

Town of Amherst v Weiss  2014 NY Slip Op 06411  Decided on September 26, 2014  Appellate Division, Fourth Department  says, Yep!. 

"It is well settled that a cause of action for legal malpractice accrues on the date when the malpractice was committed, regardless of the date on which the malpractice is actually discovered (see Shumsky v Eisenstein, 96 NY2d 164, 166; Ackerman v Price Waterhouse, 84 NY2d 535, 541; Glamm v Allen, 57 NY2d 87, 94). The parties agree that the alleged malpractice was committed on June 26, 2001, the date the hearing began before the improperly appointed Hearing Officer. The statute of limitations for legal malpractice is three years (see CPLR 214 [6]) and, therefore, the statute expired on June 26, 2004 unless it was tolled. We conclude that [*2]defendants met their initial burden of establishing that the action was commenced after the statute of limitations had expired (see International Electron Devices [USA] LLC v Menter, Rudin & Trivelpiece, P.C., 71 AD3d 1512, 1512). "The burden then shifted to [the Town] to raise a triable issue of fact whether the statute of limitations was tolled by the continuous representation doctrine" (id.; see Priola v Fallon, 117 AD3d 1489, 1489-1490; but see 730 J & J, LLC v Polizzotto & Polizzotto, Esqs., 69 AD3d 704, 705).

We conclude that the Town raised a triable issue of fact whether there were "clear indicia of an ongoing, continuous, developing, and depend[e]nt relationship between the [Town] and [defendants,] which . . . include[d] an attempt by [defendants] to rectify an alleged act of malpractice" (Luk Lamellen U. Kupplungbau GmbH v Lerner, 166 AD2d 505, 506-507; see International Electron Devices [USA], LLC, 71 AD3d at 1512-1513). Contrary to defendants’ contentions, the Town raised triable issues of fact whether the continuing representation "pertain[ed] specifically to the matter in which [defendants] committed the alleged malpractice" (Shumsky, 96 NY2d at 168; see International Electron Devices [USA], LLC, 71 AD3d at 1512-1513), and whether there was "a mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim" (McCoy v Feinman, 99 NY2d 295, 306).

The Town first hired Weiss in early 2001 to investigate the possibility of Section 75 charges against one of the Town’s employees. Weiss hired Gradl to assist him. From that point on, Weiss and Gradl performed legal work on behalf of the Town related to the Section 75 proceeding. They drafted the Section 75 charges and amended charges, presented evidence at the improperly commenced Section 75 hearing, prepared the resolution of the Town Board terminating the employee, and responded to the employee’s legal challenge to the termination. When it appeared that a second hearing was required, the Town Board resolved to appoint Weiss "and associates . . . to prosecute" the Section 75 charges and amended charges against the employee, i.e., to correct the legal error resulting in the need to nullify the first hearing and the initial determination terminating the employee. Defendants performed legal work on behalf of the Town by prosecuting the Section 75 charges and amended charges at a second hearing and by preparing the second resolution of the Town Board terminating the employee. When the employee challenged that termination, the Town Board resolved to retain Weiss’s firm to represent the Town at a potential hearing pursuant to General Municipal Law § 50-h and "to defend the Town Board’s decision" in an anticipated CPLR article 78 proceeding to be brought by the terminated employee.

Although defendants contended that their representation was not continuous, as evidenced by the fact that there were three separate and distinct actions by the Town to retain them and numerous gaps in their representation of the Town, we conclude that the Town nevertheless raised triable issues of fact concerning continuous representation. It is well established that "[a]n attorney-client relationship may exist in the absence of a formal retainer agreement" (Swalg Dev. Corp. v Gaines, 274 AD2d 385, 386; see Terio v Spodek, 63 AD3d 719, 721). Instead, such a relationship is formed by "an explicit undertaking to perform a specific task" (Terio, 63 AD2d at 721). Here, while there were three separate and distinct retainer agreements, we conclude that there are triable issues of fact whether defendants were retained for separate and distinct legal proceedings or, rather, "ongoing and developing phases of the [same] litigation" (Muller v Sturman, 79 AD2d 482, 485, citing Siegel v Kranis, 29 AD2d 477, 480-481). We cannot say as a matter of law that all of defendants’ acts "were not interrelated so that representation on [the second Section 75 hearing and the subsequent CPLR article 78 proceeding were] not part of a continuing, interconnected representation" to perform the specific task of terminating a Town employee (Deep v Boies, 53 AD3d 948, 952). Inasmuch as "[a] question of fact exists on this issue, . . . summary judgment is inappropriate" (id.).

We further conclude that there are triable issues of fact whether the gaps in the legal services that defendants performed for the Town were "merely . . . period[s] absent expectations, rather than . . . period[s] when representation formally ended" (Red Zone LLC v Cadwalader, Wickersham & Taft LLP, 2013 NY Slip Op 23468, affd 118 AD3d 581, 582). Here, as in Red Zone, the Town "immediately return[ed] to [defendants] . . . once an issue arising from [the alleged] malpractice [was] detected" (id.; see N & S Supply v Simmons, 305 AD2d 648, 649-650)"

A case arising in Erie County concerning activities in Syracuse, and all about a couple of law firms from Buffalo is being broken up and returned to Buffalo even after the New York County Commercial Division accepted the case.

Fidelity Natl. Tit. Ins. Co. v Altshuler Shaham Provident Funds Ltd.  2014 NY Slip Op 06371  Decided on September 25, 2014  Appellate Division, First Department arises from real estate and titile insurance proceedings in Syracuse.

"This action stems from a failed loan relating to commercial real estate in Syracuse, New York (see generally Altshuler Shaham Provident Funds, Ltd. V GML Tower, LLC, 21 NY3d 352 [2013]).

Fidelity National Title Insurance Company issued a policy to Altshuler. In the New York County action, plaintiff Fidelity seeks a declaration that it properly denied coverage to defendant Altshuler. In the amended third-party complaint against Jaeckle, Altshuler asserts that Jaeckle committed legal malpractice by failing to, among other things, obtain adequate title insurance. The amended third-party complaint should have been dismissed for failure to state a cause of action (CPLR 3211[a][7]), because Fidelity did not make a claim against Altshuler for which Jaeckle "is or may be liable" (CPLR 1007; see Merchants Mut. Ins. Co. v Valilis, 11 AD2d 324, 326 [1st Dept 1960]; Ainspan v City of Albany, 132 AD2d 911, 913 [3d Dept 1987]). Based on the foregoing determination, it is unnecessary to reach Jaeckle’s other arguments in support of dismissal of the amended third-party complaint.

The motion court should have denied Altshuler’s motion to consolidate the New York County and Erie County actions (see County of Westchester v White Plains Ave., LLC, 105 AD3d 690, 691 [2d Dept 2013]). As we are dismissing the amended third-party complaint in the New York County action, the two actions no longer present common questions of law or fact (see CPLR 602[a]). The issue in the New York County action is whether Fidelity properly disclaimed coverage; this will turn on the wording of the policy, not whether Jaeckle committed malpractice by obtaining the wrong type of policy.

"

Gajek v Schwartzapfel, Novick, Truowski & Marcus, P.C. 2014 NY Slip Op 32418(U) September 8, 2014 Supreme Court, Suffolk County Docket Number: 12-2375 Judge: Ralph T. Gazzillo is an example of  what we believe is the most complicated  case to litigate. Last week we discussed the successor counsel problem.  Today, we look to this case for the use of experts in legal malpractice litigation.

"Schwartzapfel and Platt now move for summary judgment dismissing the complaint and all cross
claims against Platt. In support of their motion, the moving parties submit, among other things, the
pleadings, Platt’s affidavit, and copies of the preliminary conference order and two compliance
conference orders issued in this action. The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issue of fact (see Alvarez v Prospect Hospital, 68 NY2d 320, 508 NYS2d 923 [1986]; Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 487 NYS2d 316 [1985]). The burden then shifts to the party opposing the motion which must produce evidentiary proof in admissible form sufficient to require a trial of the material issues of fact (Roth v Barreto, 289 AD2d 557, 735 NYS2d 197 [2d Dept 2001]; Rebecchi v Whitmore, 172 AD2d 600, 568 NYS2d 423 [2d Dept 1991]; O’Neill v Fishkill, 134 AD2d 487, 521 NYS2d 272 [2d Dept 1987]). Furthermore, the parties’ competing interest must be viewed "in a light most favorable to the party opposing the motion" (Marine Midland Bank, N.A. v Dino & Artie’s Automatic Transmission Co., 168 AD2d 610, 563 NYS2d 449 [2d Dept 1990]). However, mere conclusions and unsubstantiated allegations are insufficient to raise any triable issues of fact (see Zuckerman v City of New York, 49 NY2d 557, 427 NYS2d 595 [1980]; Perez v Grace Episcopal Church, 6 AD3d 596, 774 NYS2d 785 [2d Dept 2004]; Rebecchi v Whitmore, supra).

"his branch of the plaintiffs’ motion seeks a determination that they have established the first of
four clements which they must prove to hold Schwartzapfel liable for legal malpractice. As set forth
above, a plaintiff must prove ( 1) that the defendant attorney failed to exercise that degree of care, skill, and diligence commonly possessed by a member of the legal community, (2) proximate cause, (3) damages, and ( 4) that the plaintiff would have been successful in the underlying action had the attorney exercised due care (citations omitted). Generally, the plaintiff in a legal malpractice action must submit expert testimony setting forth the appropriate standard of professional care which the defendant was required to meet under the circumstances (Healy v Finz & Finz, P.C., 82 AD3d 704, 918 NYS2d 500 [2d Dept 2011]; Northrop v Thorsen, 46 AD3d 780, 848 NYS2d 304 [2d Dept 2007]; Zasso v Maher, 226 AD2d 366, 640 NYS2d 243 [2d Dept 1996]). However, there is an exception to that principle exists where the ordinary experience of the fact finder provides sufficient basis for judging the adequacy of the professional service, or "the attorney’s conduct falls below any standard of due care" (Northrop v Thorsen, 46 AD3d at 782; Greene v Payne, Wood & Littlejohn, 197 AD2d 664, 602 NYS2d 883 [2d Dept 1993 ]). It is well settled that the exception exists in those instances where an attorney ignores a well-established filing requirement (Whalen v DeGraff, Foy, Conway, Holt-Harris & Mealey, 53 AD3d 912, 863 NYS2d 100 [3d Dept 2008]; Northrop v Thorsen, supra). Tellingly, the exception has been held to apply where an action had been marked off the calendar and the attorney failed to timely restore it (Butler v Brown, 180 AD2d 406, 579 NYS2d 79 [1st Dept 1992]). "
he plaintiffs contend that the order dated October 19, 2009 (O’Donoghue, J.) denying
DeBlasio’s cross motion to restore the case to the calendar and dismissing the complaint against
Southampton Hospital, and the decision affirming said order by the Appellate Division, Second
Department, bar Schwartzapfel from re-litigating the issue of its duty to the plaintiffs. Here, despite the
plaintiffs’ mistaken reliance on the doctrine of collateral estoppel, it is determined that they have
established that Schwartzapfel violated its duty to exercise the requisite degree of care, skill, and
diligence commonly possessed by a member of the legal community in handling the plaintiffs’ medical
malpractice action. It is beyond dispute that the failure to comply with the terms of the order which
marked the case off the trial calendar, and to move within the statutory time period to restore the case to
the calendar establish that Schwartzapfel failed to prosecute the action and to meet any standard of care
in handling the matter.

Did Plaintiff paint himself into a corner, when he expanded a business and took on $100 million in personal guarantees, or did his attorneys fail him later, when litigation began?  That’s the question in Lichtenstein v Willkie Farr & Gallagher LLP  2014 NY Slip Op 06242  Decided on September 18, 2014  Appellate Division, First Department.

"Plaintiff David Lichtenstein owns and manages real estate through his entities, plaintiffs The Lightstone Group, LLC and Lightstone Holdings, LLC. In 2007, Lichtenstein and a consortium of investors purchased Extended Stay, Inc. (ESI), which owns and manages hotels. Most of the purchase price was financed through a combination of $4.1 billion in mortgage loans to ESI and $3.3 billion in 10 mezzanine loan tranches to its subsidiaries. As part of the loan transaction, Lichtenstein and Lightstone Holdings executed 11 guarantees that subjected them to $100 million in personal liability in the event of particular "bad boy" acts which included the voluntary filing of a bankruptcy petition by ESI. Lichtenstein managed ESI and became its president, CEO and chairperson. The majority of ESI’s board of directors was comprised of Lichtenstein and representatives of entities he controlled.

The following year, ESI was faced with a liquidity crisis as its financial situation declined. ESI retained nonparty Weil, Gotshal & Manges as its restructuring counsel. As stated in the complaint, Weil Gotshal could not represent both ESI and Lichtenstein. As further alleged in the complaint, Lichtenstein retained Wilkie Farr in December 2008, "to advise and represent [him] in his role as an officer and director of ESI, particularly as to the liability of him and his entities in any restructuring, as well as to advise and represent affiliates of the Lightstone Group regarding their interests in ESI." Acting as ESI’s counsel, Weil Gotshal recommended that ESI file for bankruptcy and advised that its board members, including Lichtenstein, were obligated as fiduciaries to achieve that result. Plaintiffs allege that their counsel, Willkie Farr, embraced Weil Gotshal’s position although it was allegedly erroneous and would have exposed plaintiffs to $100 million in liability on the guarantees."

"According to the complaint, ESI’s financial condition continued to deteriorate, leaving Lichtenstein with a choice to either a) have the company file for bankruptcy, exposing Lichtenstein to liability on the guarantees or, "b) seek an alternative, including to refuse, or at least delay, and force the Lenders’ hand to file a petition for involuntary bankruptcy or foreclose on the collateral (in which case Lichtenstein would risk a lawsuit under a breach of fiduciary claim [sic])." The complaint further alleges that Willkie Farr insisted that Lichtenstein had a fiduciary obligation to put ESI into bankruptcy for the benefit of the lenders. Willkie Farr warned that Lichtenstein otherwise faced the prospect of unequivocal and uncapped personal liability in any subsequent action by the lenders absent a bankruptcy filing by ESI. Before having ESI file for bankruptcy, Lichtenstein offered to surrender the collateral to the lenders as a group. Some of the lenders, however, balked and went to court to block any such surrender in what plaintiffs describe as a likely effort to force ESI into voluntary bankruptcy and trigger the "bad boy" guarantee. On Willkie Farr’s advice, Lichtenstein caused ESI to file its bankruptcy petition on June 15, 2009. The lenders brought actions on the guarantees and a judgment was subsequently entered against Lichtenstein and Lightstone Holdings in the sum of $100 million."

"n this appeal, plaintiffs argue that Willkie Farr’s advice did not meet the requisite standard of professional skill because a derivative suit by the lenders against Lichtenstein for breach of fiduciary duty would not have been successful. In making the argument, plaintiffs recognize that under Delaware law, the exposure Lichtenstein faced by reason of ESI’s insolvency differed from the exposure that would be faced by the officers and directors of a traditional stock-issuing corporation. For example, when a corporation is solvent its directors’ fiduciary duties may be enforced by its shareholders, who have standing to bring derivative actions on behalf of the corporation because they are the ultimate beneficiaries of the corporation’s growth and increased value (North Am. Catholic Educ. Programming Found., Inc. v Gheewalla, 930 A2d 92, 101 [Del 2007]). On the other hand, when a corporation is insolvent, "its creditors take the place of the shareholders as the residual beneficiaries of any increase in value. Consequently, the creditors of an insolvent corporation have standing to maintain derivative claims against directors on behalf of the corporation for breaches of fiduciary duties" (id.).

There is no merit to plaintiffs’ argument that Willkie Farr overlooked the availability of an equitable defense under the doctrine of in pari delicto. By operation of the doctrine, the position of a party defending against a claim is better than that of the party asserting the claim in a case of equal or mutual fault (see In re Oakwood Homes Corp., 389 BR 357, 365 [D Del 2008], affd 356 F Appx 622 [3rd Cir 2009]). Here, plaintiffs argue that the lenders could have been faulted for structuring the loan transactions in a way that prevented ESI from declaring bankruptcy. Plaintiffs’ argument is flawed because they allege no wrongdoing that the lenders [*3]have committed in negotiating the guarantees in the course of an arms length transaction. We have considered plaintiffs’ remaining arguments and find them unavailing."

It’s well understood that non-pecuniary damages are not available in legal malpractice.  No damages for emotional distress, no damages for physical injury (think: heart attack) from legal malpractice and no damages for wrongful incarceration which are non-pecuniary.  Nevertheless, in D’Alessandro v Carro  2014 NY Slip Op 06246  Decided on September 18, 2014  Appellate Division, First Department , Presiding Justice Tom, threads his way to a decision in which all of these prohibited damages are available to plaintiff.  It all starts with a dismissed appeal.

"In June 2010, this Court granted plaintiff’s application for a writ of error coram nobis, reversing the judgment of conviction and dismissing the indictment (People v D’Alessandro, 2010 NY Slip Op 75591[U] [1st Dept 2010]). We held that appellate counsel’s failure to raise a clear-cut speedy trial issue was dispositive of the question of effective assistance of counsel (id.). In particular, we held that the period of 196 days between the filing of plaintiff’s omnibus motion seeking dismissal of the indictment and the time the People produced the grand jury minutes in response to the motion alone would have exceeded the 184 days during which the People were required to be ready for trial (CPL 30.30[1][a]). We noted that the issue of whether the time was chargeable to the People was settled law (see People v McKenna, 76 NY2d 59 [1990]) and had counsel raised the issue, his client would have prevailed (D’Alessandro, 2010 NY Slip Op 75591[U]).

Plaintiff then commenced the instant legal malpractice action in January 2011. The complaint alleges that defendants’ failure to raise the speedy trial issue on appeal caused plaintiff to needlessly remain incarcerated for over 13 years. He seeks damages of $26 million, including loss of income, as well as nonpecuniary damages for emotional and physical distress, damage to reputation and loss of consortium.

In response, defendants moved to dismiss the complaint for failure to state a cause of action based on the documentary evidence (CPLR 3211[a][1], [7]). In the alternative, the motion sought dismissal of the claims for nonpecuniary damages on the ground that such damages are unavailable in legal malpractice cases. In their memorandum of law in support of the motion, defendants relied upon this Court’s ruling in Wilson v City of New York (294 AD2d 290 [1st Dept 2002]), which likewise involved a claim arising out of the plaintiff’s conviction on criminal charges and resulting incarceration. As defendants noted, Wilson holds that the bar against recovery of nonpecuniary damages in a legal malpractice action is a matter of policy not limited to the civil context (id. at 292-293).

However, the Supreme Court (Emily Jane Goodman, J.), on February 29, 2012, denied [*3]the motion in its entirety and allowed the claims for nonpecuniary damages to remain (34 Misc 2d 1242[A], 2012 NY Slip Op 50508[U], *6 [Sup Ct, NY, County 2012]). In doing so, the motion court rejected this Court’s rule in Wilson that nonpecuniary damages may not be sought in malpractice cases, even in the criminal context (id. at *5-6). The court noted that the "ten year old Wilson theory of damages was not adopted by the Fourth Department" in the more recent decision of Dombrowski v Bulson (79 AD3d 1587 [4th Dept 2010], revd 19 NY3d 347 [2012]), which held that non-pecuniary damages may be recovered in criminal malpractice cases. Noting that D’Alessandro would have been spared 10 years of incarceration if the direct appeal had challenged the speedy trial ruling, the court reasoned, "[I]f the . . . First Department had the occasion to revisit the instant case, or a similar one where malpractice has been established and the issue of damages central, perhaps it would be viewed differently" (2012 NY Slip Op 50508[U], *5). Dombrowski was subsequently overturned on May 31, 2012 (19 NY3d 347 [2012]).

While defendants have denominated their motion as one seeking renewal, they identify no change in law warranting reexamination of their arguments. It is axiomatic that Supreme Court is bound to apply the law as promulgated by the Appellate Division within its particular Judicial Department (McKinney’s Cons Laws of NY, Book 1, Statutes § 72[b]), and where the issue has not been addressed within the Department, Supreme Court is bound by the doctrine of stare decisis to apply precedent established in another Department, either until a contrary rule is established by the Appellate Division in its own Department or by the Court of Appeals (Mountain View Coach Lines v Storms, 12 AD2d 663, 664 [2d Dept 1984]; see also People v Turner, 5 NY3d 476, 481-482 [2005]; United States Gypsum Co. v Riley-Stoker Corp., 11 Misc 2d 572, 575 [Sup Ct, Genesee County 1958] ["The doctrine of stare decisis does not compel a judge at Special Term to follow a decision of a Special Term in another judicial district; nevertheless, he shall follow a decision made by the Appellate Division of another department, unless his own Appellate Division or the Court of Appeals holds otherwise"] [emphasis omitted]), affd 7 AD2d 894 [4th Dept 1959], revd on other grounds 6 NY2d 188 [1959]. Thus, a particular Appellate Division will require the lower courts within its Department to follow its rulings, despite contrary authority from another Department, until the Court of Appeals makes a dispositive ruling on the issue (see e.g. Ross v Curtis-Palmer Hydro-Elec. Co., 180 AD2d 385, 390 [3d Dept 1992], mod 81 NY2d 494 [1993]).

In this case, the applicable law was established by our ruling in Wilson v City of New [*5]York (294 AD2d at 292-293), which holds that nonpecuniary damages are unrecoverable in a legal malpractice action whether the malpractice is civil or criminal in nature. The law in this Department was unaltered by the ensuing Court of Appeals’ decision in Dombrowski. Indeed, in following Wilson and rejecting the Fourth Department’s contrary position, the Court of Appeals stated, "We see no compelling reason to depart from the established rule limiting recovery in legal malpractice actions to pecuniary damages" (19 NY3d at 352). While Supreme Court did not decide the procedural issue, it is clear that defendants have advanced no grounds for renewal of their motion to dismiss. Indeed, an intervening ruling that merely clarifies existing law does not afford a basis for renewal attributed to a change in the law (Philips Intl. Invs., LLC v Pektor, 117 AD3d 1 [1st Dept 2014]). While this Court has the discretion to reconsider an issue on an appeal previously dismissed for failure to prosecute, "even if it could have dismissed the appeal under Bray" (Faricelli at 794), the instant appeal must be dismissed since defendants’ motion before the motion court was one to reargue, the denial of which is not appealable (Pier 59 Studios, L.P. v Chelsea Piers, L.P., 40 AD3d 363, 366 [1st Dept 2007]). We have considered defendants’ remaining contentions and find them unavailing."

Gajek v Schwartzapfel, Novick, Truowski & Marcus,  P.C.  2014 NY Slip Op 32418(U)  September 8, 2014  Supreme Court, Suffolk County  Docket Number: 12-2375  Judge: Ralph T. Gazzillo discusses the burden for both plaintiff and defendant.

For Defendant:  Schwartzapfel and Platt now move for summary judgment dismissing the complaint and all cross claims against Platt. In support of their motion, the moving parties submit, among other things, the pleadings, Platt’s affidavit, and copies of the preliminary conference order and two compliance conference orders issued in this action. The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issue of fact (see Alvarez v Prospect Hospital, 68 NY2d 320, 508 NYS2d 923 [1986]; Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 487 NYS2d 316 [1985]). The burden then shifts to the party opposing the motion which must produce evidentiary proof in admissible form sufficient to require a trial of the material issues of fact (Roth v Barreto, 289 AD2d 557, 735 NYS2d 197 [2d Dept 2001]; Rebecchi v Whitmore, 172 AD2d 600, 568 NYS2d 423 [2d Dept 1991]; O’Neill v Fishkill, 134 AD2d 487, 521 NYS2d 272 [2d Dept 1987]). Furthermore, the parties’ competing interest must be viewed "in a light most favorable to the party opposing the motion" (Marine Midland Bank, N.A. v Dino & Artie’s Automatic Transmission Co., 168 AD2d 610, 563 NYS2d 449 [2d Dept 1990]). However, mere conclusions and unsubstantiated allegations are insufficient to raise any triable issues of fact (see Zuckerman v City of New York, 49 NY2d 557, 427 NYS2d 595 [1980]; Perez v Grace Episcopal Church, 6 AD3d 596, 774 NYS2d 785 [2d Dept 2004]; Rebecchi v Whitmore, supra). For a defendant in a legal malpractice case to succeed on a motion for summary judgment, evidence must be presented in admissible form establishing that the plaintiff is unable to prove at least one of the essential elements of a malpractice cause of action (Napolitano v Markotsis & Lieberman, 50 AD3d 657. 855 NYS2d 593 [2d Dept 2008]; Olaiya v Golden, 45 AD3d 823, 846 NYS2d 604 [2d Dept 2007]; Caires v Sihen & Sihen, 2 AD3d 383, 767 NYS2d 785 [2d Dept 2003]; Ippolito v McCormack, Damiani, Lowe & Mellon, 265 AD2d 303, 696 NYS2d 203 [2d Deptl 999]). To establish a cause of action to recover damages for legal malpractice, a plaintiff must prove ( 1) that the defendant attorney failed to exercise that degree of care, skill, and diligence commonly possessed by a member of the legal community, (2) proximate cause, (3) damages, and (4) that the plaintiff would have been successful in the underlying action had the attorney exercised due care (Tortura v Sullivan Papain
Block McGrath & Cannavo, P.C., 21AD3d1082, 803 NYS2d 571 [2d Dept 2005]; Ippolito v McCormack, Damiani, Lowe & Mellon, supra; Iannarone v Gramer, 256 AD2d 443, 682 NYS2d 84
[2d Dept 1998]; Volpe v Canfield, 237 AD2d 282, 654 NYS2d 160 [2d Dept 1997], lv denied 90 NY2d
802, 660 NYS2d 712 [ 1997]). "

For Plaintiff:  The plaintiffs now cross-move for partial summary judgment as to the liability of Schwartzapfel and DeBlasio or, in the alternative, holding that said defendants violated a duty to the plaintiffs which resulted in their medical malpractice action being dismissed. As noted above, after the date of the making of this cross motion, the plaintiffs discontinued their action as to DeBlasio. Thus, the plaintiffs cross motion against DeBlasio is denied as academic. In support of their motion, the plaintiffs submit, among other things, the aforesaid affirmation of Gajek and affidavit of counsel for the plaintiffs, a copy of a letter to Schwartzapfel from the New York State Department of Health, and an affidavit from a physician licensed in New York. In order to establish a prima facie case of legal malpractice, a plaintiff must demonstrate that the breach of the attorney’s duty proximately caused the plaintiff actual and ascertainable damages (see Leder v Spiegel, 9 NY3d 836, 840 NYS2d 888 [2007]; Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 835 NYS2d 534 [2007]; McCoy v Fienman, 99 NY2d 295, 755 NYS2d 693 [2002]; Darby & Darby, P.C. v VSI Intl. Inc., 95 NY2d 308, 716 NYS2d 378 [2000]; Kluczka v Lecci, 63 AD3d 796, 880 NYS2d 698 [2d Dept 2007]). Moreover, the plaintiff is required to prove that, "but for" the attorney’s negligence, the plaintiff would have prevailed on the underlying cause of action (see AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 834 NYS2d 705 [2007]; Leder v Spiegel, supra; Snolis v Clare, 81 AD3d 923, 917 NYS2d 299 [2d Dept 2011]; Weil, Gotshall & Manges, LLP v Fashion Boutique of Short Hills, Inc., 10 AD3d 267, 780 NYS2d 593 [1st Dept 2004]; Shopsin v Siben & Siben, 268 AD2d 578, 702 NYS2d 610 [2d Dept 2000]). Thus, the plaintiffs here are required to prove that they would have been successful in their medical malpractice action. "