Daughter works for a law firm, and hears of a financial opportunity.  She gets her parents involved, and surprise…the loans do not work out!  They sue the law firm for legal malpractice.  Rodolico v Rubin & Licatesi, P.C.   2013 NY Slip Op 08068 [112 AD3d 608]   December 4, 2013
Appellate Division, Second Department  stands for two things.  The first is that standing is very, very important in legal malpractice.  If you did not hire the attorney, you may not sue the attorney.

"In support of that branch of their cross motion which was to dismiss the complaint [*2]for lack of standing, the defendants argued that the plaintiff had no interest in the loaned funds because two of the loans, for which the plaintiff sought recovery in the second and fourth causes of action, were funded by C&R, and three of the loans, for which the plaintiff sought recovery in the first, third, and fifth causes of action, were funded by Joanne. The plaintiff does not deny that the funds for two of the loans were provided by C&R, but merely asserts that he and Joanne own C&R. However, "[f]or a wrong against a corporation a shareholder has no individual cause of action, though he loses the value of his investment" (Abrams v Donati, 66 NY2d 951, 953 [1985]; see Citibank v Plapinger, 66 NY2d 90, 93 n [1985]; Elenson v Wax, 215 AD2d 429 [1995]; General Motors Acceptance Corp. v Kalkstein, 101 AD2d 102, 106 [1984]). Here, the plaintiff’s action was brought in his own name, and there is nothing in the complaint to indicate that the plaintiff brought this action in a derivative capacity, on behalf of C&R. Accordingly, since the plaintiff does not have standing, individually, to seek the return of funds purportedly borrowed from C&R by the defendants, the second and fourth causes of action should have been dismissed insofar as they were asserted by the plaintiff in his individual capacity."

The same is not true, however, of the first, third, and fifth causes of action, which sought the return of funds that the defendants allege were provided by Joanne. The plaintiff and Joanne averred that, although Joanne went to the bank to purchase the bank checks, they do not keep their finances separate, and the funds belonged to both of them. The defendants presented no evidence to the contrary. The plaintiff, therefore, had standing to seek the return of the funds (see generally Wells Fargo Bank Minn., N.A. v Mastropaolo, 42 AD3d 239, 242 [2007]), and the Supreme Court properly denied the branch of the defendants’ motion which sought dismissal of the first, third, and fifth causes of action for lack of standing.

For social policy reasons, and probably to prevent wide-spread suits against opposing attorneys which might swamp the system, a legal malpractice complaint must allege an attorney-client relationship in order to survive.  This question of privity is the first of several thresholds that a plaintiff must cross.  In Mr. San, LLC v Zucker & Kwestel, LLP  2013 NY Slip Op 08416 [112 AD3d 796]  December 18, 2013  Appellate Division, Second Department  we see a case which slips into the exception.

"On a motion to dismiss pursuant to CPLR 3211 (a) (1), "dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law" (Leon v Martinez, 84 NY2d 83, 88 [1994]). In deciding a motion to dismiss pursuant to CPLR 3211 (a) (7), the court must "accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory" (Leon v Martinez, 84 NY2d at 87-88).

Applying these principles, the Supreme Court properly denied those branches of the defendants’ motion which were pursuant to CPLR 3211 (a) (1) and (7) to dismiss the first cause of action, which sought to recover damages for legal malpractice. While the complaint does not allege an attorney-client relationship between the plaintiffs and the defendants, it sets forth a claim which falls within "the narrow exception of fraud, collusion, malicious acts or other special circumstances" under which a cause of action alleging attorney malpractice may be asserted absent a showing of privity (Ginsburg Dev. Cos., LLC v Carbone, 85 AD3d 1110, 1112 [2011] [internal quotation marks omitted]; see Aranki v Goldman & Assoc., LLP, 34 AD3d 510, 511-512 [2006]; Griffith v Medical Quadrangle, 5 AD3d 151, 152 [2004]). Furthermore, the documentary evidence submitted by the defendants does not conclusively establish a defense to this cause of action as a matter of law (see CPLR 3211 [a] [1])."

Dombrowski v Bulson  2012 NY Slip Op 04203 [19 NY3d 347]  May 31, 2012  Lippman, Ch. J.  Court of Appeals was a very important case in legal malpractice, which held that "an award of nonpecuniary damages is generally unavailable to a plaintiff in an action for attorney malpractice."  It was not wholly unprecedented.  Prior to that it was well understood that emotional disturbance damages were not available in legal malpractice.  In Borges v Placeres  2014 NY Slip Op 24053 [43 Misc 3d 61], Appellate Term, 1st Department (2014), defense attorney failed to raise any objection to the jury charge permitting pain and suffering damages.  Even a statute of limititations defense was overlooked.

"Defendant’s various assignments of error regarding the conduct of the trial are lacking in merit. The jury charge as a whole conveyed the correct legal principles (see Georgescu v City of New York, 107 AD3d 946 [2013]). Plaintiff was not required to prove that "but for" defendant’s [*2]negligence, he would have prevailed in the immigration case; rather, his trial burden here was limited to proving that he would not have incurred damages but for defendant’s pursuit of an unreasonable course of action (see Tenesaca Delgado v Bretz & Coven, LLP, 109 AD3d 38, 44 [2013]; see also Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]). Nor was it reversible error for the court to include in the verdict sheet a question regarding whether defendant’s alleged malpractice was a "substantial factor" in causing any injury to plaintiff (see Barnett v Schwartz, 47 AD3d 197, 204-205 [2007]; see also Martonick v Pudiak, 285 AD2d 935, 936 [2001]). Contrary to defendant’s contention, there is simply no indication that the verdict sheet, when viewed in the context of the charge as a whole (see Iasello v Frank, 257 AD2d 362 [1999]), caused confusion or doubt among the jurors over the applicable principles of law (see McFadden v Oneida, Ltd., 93 AD3d 1309, 1311 [2012]).

[2]; {**43 Misc 3d at 64}With respect to damages, it need be emphasized that our review of the jury’s award may not be based on the recent decisional law relied upon by defendant—precedent holding that an award of nonpecuniary damages is generally unavailable to a plaintiff in an action for attorney malpractice (see Dombrowski v Bulson, 19 NY3d 347 [2012]). Notably, defendant did not raise an objection to the jury charge as given, instructing the jury that they could award plaintiff damages for pain and suffering, or to the corresponding question on the verdict sheet, and, indeed, defendant raised no objection at trial to the introduction of evidence regarding the mental and emotional disturbance caused by plaintiff’s detention. Thus, the court’s unexcepted to jury charge became the law of the case, or more accurately, "consent . . . to the law to be applied" (Martin v City of Cohoes, 37 NY2d 162, 165 [1975]; see Knobloch v Royal Globe Ins. Co., 38 NY2d 471, 477 [1976]). Moreover, defendant does not otherwise argue that the award of damages deviated materially from what would be reasonable compensation (see Harvey v Mazal Am. Partners, 79 NY2d 218, 225 [1992]).

[3]; Turning to the propriety of the denial of defendant’s eve-of-trial motion to amend his answer, we find no abuse of the court’s discretion. Defendant’s motion for leave to include the statute of limitations as a defense was made approximately eight years after he served his initial answer, and after plaintiff engaged in discovery, motion practice and placed the case on the trial calendar, presumably spending considerable time and expense preparing for trial. "

Plaintiff has an excessive force claim against the NYCPD.  Arrest is on 9/15/09. ACD is given on 3/25/10.  Plaintiff retains law firm on 10/27/10.  On 5/16/11 law firm returns case to client and says they will not handle.  No notice of claim is ever filed, and no real motion seeking leave to file a late notice of claim is ever made.  Result?

 "In the motion sub judice, the City seeks (1) dismissal of plaintiff=s state law claims based on her failure to serve a notice of claim and failure to timely commence the action within the one  year-and-ninety-day statute of limitations set forth in General Municipal Law ’50-i(1)(c), and (2) dismissal of any federal claims predicated on the violation of USC ‘1983 as barred by the three-year statute of limitations applicable to such actions (see Saunders v. State of New York, 629 FSupp 1067, 1070 [N.D. N.Y. 1986]). "

"It is a condition precedent to the maintenance of any tort action against the City that a Notice of Claim be served upon it within 90 days after a claim arises (see General Municipal Law ’50-e[1][a]; 50-i[1][a]). Of course, it is statutorily provided that a court may, in the exercise of its discretion, extend the 90-day time limit (see General Municipal Law ’50-e[5]; "

"Here, not only has plaintiff failed to serve a Notice of Claim upon the City, but she has likewise failed to move for leave to serve a late Notice of Claim as authorized by General Municipal Law ’50-e(5). Moreover, although a certain level of laxity in matters of procedure traditionally have been overlooked where a party is proceeding pro se, plaintiff at bar has provided this Court with no proof whatsoever of the City=s acquisition of actual knowledge of the essential facts constituting her claim within 90 days after the claim arose or within a reasonable time thereafter@ (General Municipal Law ’50-e[5])."

"Thus, this Court has no alternative but to dismiss her action against the City as barred by
the Statute of Limitations in General Municipal Law ’50-i(1)(c). Nevertheless, it should be noted
that plaintiff"s malpractice action against her attorneys Jason Leventhal and Klein is still pending."

Sometimes the question of legal malpractice is at the forefront of a case, and sometimes it is the least important part.  in K2 Inv. Group, LLC v American Guar. & Liab. Ins. Co.  2014 NY Slip Op 01102 [22 NY3d 578]  February 18, 2014  Judge Smith of the Court of Appeals makes the rare admission of their mistake, and agrees that on a motion to renew, the decision should be reversed.

"In K2-I, we affirmed an order granting plaintiffs summary judgment, holding that American Guarantee’s breach of its duty to defend barred it from relying on policy exclusions. We later granted reargument (21 NY3d 1049 [2013]), and we now vacate our prior decision and reverse the Appellate Division’s order.{**22 NY3d at 585}"

In Servidone—a case in which, as in this one, the insurer was relying on policy exclusions in defending against a suit for indemnification—we stated the question as follows:

"Where an insurer breaches a contractual duty to defend its insured in a personal injury action, and the insured thereafter concludes a reasonable settlement with the injured party, is the insurer liable to indemnify the insured even if coverage is disputed?" (64 NY2d at 421.)
We answered the question in Servidone no. In K2-I, we held that "when a liability insurer has breached its duty to defend its insured, the insurer may not later rely on policy exclusions to escape its duty to indemnify the insured for a judgment against him" (21 NY3d at 387). The Servidone and K2-I holdings cannot be reconciled.

In short, to decide this case we must either overrule Servidone or follow it. We choose to follow it.

There is much to be said for the rule of K2-I, as our previous opinion shows; but, as the Servidone opinion shows, there is also much to be said for the Servidone rule. Several states follow the Servidone approach (e.g. Sentinel Ins. Co., Ltd. v First Ins. Co. of Haw., Ltd., 76 Haw 277, 290-297, 875 P2d 894, 907-914 [1994]; Polaroid Corp. v Travelers Indem. Co., 414 Mass 747, 760-766, 610 NE2d 912, 919-923 [1993]), while others adopt a rule like that of K2-I (e.g. Employers Ins. of Wausau v Ehlco Liquidating Trust, 186 Ill 2d 127, 150-154, 708 [*4]NE2d 1122, 1134-1136 [1999]; Missionaries of Co. of Mary, Inc. v Aetna Cas. & Sur. Co., 155 Conn 104, 112-114, 230 A2d 21, 25-26 [1967]). A federal district judge, writing in 1999, said that "[t]he majority of jurisdictions which have considered the question" follow the Servidone rule (Flannery v Allstate Ins. Co., 49 F Supp 2d 1223, 1227 [D Colo 1999]).

Under these circumstances, we see no justification for overruling Servidone. Plaintiffs have not presented any indication that the Servidone rule has proved unworkable, or caused{**22 NY3d at 587} significant injustice or hardship, since it was adopted in 1985. When our Court decides a question of insurance law, insurers and insureds alike should ordinarily be entitled to assume that the decision will remain unchanged unless or until the legislature decides otherwise. In other words, the rule of stare decisis, while it is not inexorable, is strong enough to govern this case.

"

Plaintiff is on probation and gives an oral sample for drug testing.  Kroll labs tests the saliva and finds THC.  An independent urine drug test taken as a safety measure by Plaintiff is negative.  Plaintiff’s probation period is extended.  There are no pecuniary losses.  May Plaintiff recover. 

Here, yes.  If it were legal malpractice, no.  Why?  InLandon v Kroll Lab. Specialists, Inc.  2013 NY Slip Op 06597 [22 NY3d 1]  October 10, 2013 Lippman, J. , the Court of Appeals tells us that legal malpractice is different.

"In addition, we reject defendant’s argument that plaintiff failed to allege that he has suffered a cognizable harm (see e.g. Martinez v Long Is. Jewish Hillside Med. Ctr., 70 NY2d 697, 699 [1987] ["where there is a breach of a duty owed by defendant to plaintiff, the breach of that duty resulting directly in emotional harm is actionable"]). In this procedural posture, {**22 NY3d at 8}plaintiff’s allegations of the loss of freedom occasioned by the extension of his probation and the resulting emotional and psychological harm are sufficient to withstand a motion to dismiss. Defendant places too much weight upon our recent decision in Dombrowski v Bulson (19 NY3d 347 [2012]), characterizing it as holding that loss of freedom damages are not recoverable in negligence actions. In that case, we found that a legal malpractice action did not lie against a criminal defense attorney to recover nonpecuniary damages. The decision was based in part on policy considerations, including the potentially devastating consequences such liability would have on the criminal justice system and, in particular, the possible deterrent effect it would have on the defense bar concerning the representation of indigent defendants (see Dombrowski, 19 NY3d at 352). Similar policy considerations do not weigh in defendant’s favor here."

Not that many legal malpractice cases get tried, and fewer even in Civil Court, New York County.  here is one that went to defendant.  Milgram Thomajan & Lee, P.C. v Golden Gate Petroleum, P.C.    2014 NY Slip Op 24063 [43 Misc 3d 68]. 

"The action arises out of plaintiff’s representation of the first-named defendant, a petroleum importer, in connection with an administrative protest of a customs duty assessment imposed on a shipment of gasoline and related chemicals. The jury’s verdict, finding that plaintiff did not commit malpractice in its underlying representation of defendant, was not against the weight of the evidence. The trial evidence, fairly interpreted, supports the jury’s evident rejection of defendant’s contention that but for plaintiff’s advice, defendant would have prevailed in the underlying customs protest, one which, the record shows, defendant elected to pursue in the face of plaintiff’s frank admonition that it "may prove a tough fight, the outcome of which cannot be predicted with any certainty." The evidence, including the conflicting expert OPINION TESTIMONY, permitted the jury to conclude that, in advising defendant, the lawyers of plaintiff law firm did not disregard settled law (see Darby & Darby v VSI Intl., 95 NY2d 308, 313 [2000]) and would have permitted a jury finding that the advice itself was not the proximate cause of defendant’s losses (see Chadbourne & Parke v HGK Asset Mgt., 295 AD2d 208, 209 [2002]). And while defendant posits several alternative courses that plaintiff might have pursued in the underlying administrative protest, it FAILED to show that the tactical decisions made by the firm did not constitute "proper strategic legal decision-making" (Taylor v Paskoff & Tamber, LLP, 102 AD3d 446, 448 [2013]), or so the jury reasonably could find. Nor was the jury’s consideration of the LEGAL MALPRACTICE issue shown to have been compromised in any way [*2]by the form{**43 Misc 3d at 70} of the verdict sheet, particularly when that document is viewed in the context of the charge as a whole (see Plunkett v Emergency Med. Serv. of N.Y. City, 234 AD2d 162, 163 [1996]).

The record discloses no evidentiary error warranting reversal. The out-of-court statements made by defendant’s (now) deceased CHIEF FINANCIAL OFFICER were admissible under the "speaking agent" exception to the hearsay rule (see Loschiavo v Port Auth. of N.Y. & N.J., 58 NY2d 1040, 1041 [1983]). Further, in light of the voluminous evidence considered by the jury, including over 60 trial exhibits introduced by defendant, any error in the exclusion of the two documents now complained of by defendant would have been harmless (see Ramkison v New York City Hous. Auth., 269 AD2d 256, 256 [2000]).

We note finally that the court properly directed a verdict in favor of plaintiff on its main claim for unpaid legal services, a claim which, as one abandoned by plaintiff’s trustee in BANKRUPTCY, revested in plaintiff at the close of the bankruptcy proceeding (see Dynamics Corp. of Am. v Marine Midland Bank-N.Y., 69 NY2d 191, 195-196 [1987]; Culver v Parsons, 7 AD3d 931, 932 [2004])."

Student – Plaintiff is charged with harassing a Cornell professor, and loses at the disciplinary and College level.  Student then sues attorney for legal malpractice, breach of fiduciary duty and breach of contract.  Case is lost simply because Plaintiff does not allege and show how the attorney could have won the Article 78 case showing that the University was arbitrary and capricious.

"In August 2007, plaintiff—then a Cornell University graduate student—was charged with violating the University’s Campus Code of Conduct by allegedly harassing a professor. Following disciplinary proceedings, the University’s Hearing Board sustained the harassment charge and issued a penalty, which was, apart from a slight modification, affirmed by the University’s Review Board. Plaintiff then retained defendant Arthur Schwartz to represent her in a CPLR article 78 proceeding challenging the University’s determination. In addition, Schwartz represented plaintiff in a Title IX claim (see 20 USC § 1681 et seq.). After both of those matters were unsuccessful (Matter of Hyman v Cornell Univ., 82 AD3d 1309 [2011]; Hyman v Cornell Univ., 834 F Supp 2d 77 [2011]), plaintiff commenced the instant action against Schwartz, defendant Schwartz, Lichten & Bright, PC (hereinafter the law firm)—Schwartz’s former and now dissolved law firm—and defendants Stuart Lichten and Daniel Bright—his former partners—seeking damages for negligent and intentional infliction of emotional distress and legal malpractice. In the same complaint, plaintiff also challenged an arbitration award made in Schwartz’s favor in connection with a fee dispute between Schwartz and plaintiff."

"However, defendants correctly argue that Supreme Court should have granted their motion to dismiss the legal malpractice claim. It is well established that, "[i]n order to sustain a claim for legal malpractice, a plaintiff must establish both that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession which results in actual damages to a plaintiff, and that the plaintiff would have succeeded on the merits of the underlying action but for the attorney’s negligence" (Leder v Spiegel, 9 NY3d 836, 837 [2007], cert denied sub nom. Spiegel v Rowland, 552 US 1257 [2008] [internal quotation marks and citation omitted]; accord Alaimo v McGeorge, 69 AD3d 1032, [*3]1034 [2010]; see Kreamer v Town of Oxford, 96 AD3d 1128, 1128-1129 [2012]; see also MacDonald v Guttman, 72 AD3d 1452, 1454-1455 [2010]; Bixby v Somerville, 62 AD3d 1137, 1139 [2009]). Here, although the complaint is replete with allegations of Schwartz’s alleged failures to use reasonable and ordinary skill in connection with both of plaintiff’s underlying claims, it contains no allegation that, but for these alleged failures, plaintiff would have been successful on either claim.[FN2] Therefore, even if we accept the allegations as true and liberally construe the complaint to allege negligent representation by Schwartz (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]; Moulton v State of New York, 114 AD3d 115, 119 [2013]; Scheffield v Vestal Parkway Plaza, LLC, 102 AD3d 992, 993 [2013]), the allegations are insufficient to make out a prima facie case of legal malpractice (see Kreamer v Town of Oxford, 96 AD3d at 1128; MacDonald v Guttman, 72 AD3d at 1455)."