New York Attorney Malpractice Blog

New York Attorney Malpractice Blog

Speculative v. Intervening Causation in a Legal Malpractice Case

Posted in Uncategorized

Client is injured and several municipality defendants may be liable.  Attorneys fail to file a Notice of Claim within the requisite 90 days.  Attorneys are fired and new attorneys hired.  One year and 90 days pass.  Is there legal malpractice and if so, who might be responsible?

Liporace v Neimark & Neimark, LLP  2018 NY Slip Op 04668  Decided on June 26, 2018
Appellate Division, First Department answers this question in a cogent decision.  Attorney 1 was replaced by Attorney 2 while a motion for leave to file a late notice could still be made.

“The Budin defendants, as successor counsel, had an opportunity to protect plaintiff’s rights by seeking discretionary leave, pursuant to General Municipal Law § 50-e(5), to serve a late notice of claim. Whether the Budin defendants would have prevailed on such motion will have to be determined by the trier of fact (see Davis v Isaacson, Robustelli, Fox, Fine, Greco & Fogelgaren, 284 AD2d 104 [1st Dept 2001], lv denied 97 NY2d 613 [2002]; F.P. v Herstic, 263 AD2d 393 [1st Dept 1999]). We do not find this determination to be speculative given that Supreme Court will weigh established factors in exercising its General Municipal Law § 50-e(5) discretion (see e.g. Rodriguez v City of New York, 144 AD3d 574 [1st Dept 2016]; Matter of Strohmeier v Metropolitan Transp. Auth., 121 AD3d 548 [1st Dept 2014]).

We agree with plaintiff’s argument that the Neimark defendants’ failure to serve a timely notice of claim, as of right, on the New York City Department of Education in the underlying personal injury action remains a potential proximate cause of his alleged damages. Plaintiff has a viable claim against the Neimark defendants despite the fact that the Budin defendants were substituted as counsel before the expiration of time to move to serve a late notice of claim. Thusthe Budin defendants’ substitution can only be deemed a superseding and intervening act that severed any potential liability for legal malpractice on the part of the Neimark defendants if a determination is made that a motion for leave to serve a late notice of claim would have been successful in the underlying personal injury action (see Pyne v Block & Assoc., 305 AD2d 213 [1st Dept 2003]).”

A Veteran Legal Malpractice Pro-Se Litigant and Service Problems

Posted in Legal Malpractice Cases

Debra Cascardo is a pro-se litigant in Cascardo v Macklowitz  2018 NY Slip Op 31231(U) June 8, 2018 Supreme Court, New York County Docket Number: 101528/2017 Judge: Frank P. Nervo. One of her earlier legal malpractice cases, in her married name,  added to the Harvey line of cases in which a legal malpractice case is dismissed on the basis that  “Plaintiff acknowledged that she understood and agreed with the terms of the settlement and knew that it was a full and final agreement. She further stated that her attorney had answered her questions and that she was satisfied with the services he provided. Under these circumstances, the motion court properly dismissed the complaint (see Weissman v Kessler, 78 AD3d 465 [2010]; Katebi v Fink, 51 AD3d 424 [2008]).”

Here, in the present case, service problems threaten to overwhelm her case.  “In this legal malpractice action, defendants move, pursuant to CPLR 3211 (a) (8), for preanswer dismissal of plaintiffs complaint for lack of personal jurisdiction based on improper service. Plaintiff, appearing prose, opposes the application. The affidavit of service filed with the New York County Clerk on December 7, 2017 reveals that nonparty Dusty Burke (Burke) served defendants on October 27, 2017 by leaving the summons and complaint with their receptionist at their business located at 299 Broadway, Suite 1405, in New York County. ”

Staving off immediate dismissal, a Traverse hearing will be held.

It’s Not a Bilateral Situation

Posted in Legal Malpractice Cases

Central Amusement Intl. LLC v Lexington Ins. Co.  2018 NY Slip Op 04095  Decided on June 7, 2018 Appellate Division, First Department demonstrates that while permission to amend a pleading should be freely given, its not the same standard for the complaint as it is for the answer.

“The motion court did not abuse its discretion in granting defendant’s motion to amend its answer (see Murray v City of New York, 43 NY2d 400, 404-405 [1977]; McGhee v Odell, 96 AD3d 449, 450 [2012]; CPLR 3025[b]). Plaintiff’s argument that it was prejudiced at the time of the amendment because it was time-barred from pursuing a professional malpractice claim against its engineer, is unavailing. The motion court correctly observed that plaintiff had the opportunity and duty to perform its own investigation to uncover potential culpable conduct by its contractors, engineers, or any other party that may have contributed to the loss, but it chose not to do so. Plaintiff has also not established the validity of its prejudice claim, as it never attempted to sue its engineer (or other third party) following the disclosure of defendant’s expert report. The claim that defendant’s production of the expert report was delayed finds no support since it was timely produced during expert discovery.

Nor did the court abuse its discretion in denying plaintiff’s renewal motion (see CPLR 2221[e]; Matter of South Bronx Unite! v New York City Indus. Dev. Agency, 138 AD3d 462 [1st Dept 2016]). Plaintiff failed to show any new facts that would have been relevant to the court’s consideration of the motion. Furthermore, the court’s denial of plaintiff’s motion to amend the complaint was properly denied since the proposed amendment was “palpably improper or insufficient as a matter of law” (McGhee at 450 [internal quotation marks omitted]).”

Matrimonial Settlements and Attorney Fees

Posted in Legal Malpractice Cases

NEW CITY:     A recurring strain of legal malpractice cases come from matrimonial settlements.  More than any other sector of litigation, matrimonial settlements tempt the Courts to avoid a “effectively compelled to settle” analysis in favor of a “I’m satisfied with my attorney” analysis.  Imagine if medical malpractice law allowed a surgical patient to be awoken and asked whether they approved of their doctor’s work?

Here, plaintiff loses on both ends.  An account stated is found, and the settlement of the matrimonial is found to rule out legal malpractice.

“” An account stated is an agreement between parties, based upon their prior transactions, with respect to the correctness of the account items and the specific balance due'” (Bashian & Farber, LLP v Syms, 147 AD3d 714, 715, quoting Citibank [South Dakota], N.A. v Abraham, 138 AD3d 1053, 1056). “Although an account stated may be based on an express [*2]agreement between the parties as to the amount due, an agreement may be implied where a defendant retains bills without objecting to them within a reasonable period of time, or makes partial payment on the account” (Citibank [South Dakota], N.A. v Abraham, 138 AD3d at 1056; see Fleetwood Agency, Inc. v Verde Elec. Corp., 85 AD3d 850). The “agreement” at the core of an account stated is independent of the underlying obligation between the parties (see Citibank [South Dakota], N.A. v Abraham, 138 AD3d at 1056; Citibank [S.D.] N.A. v Cutler, 112 AD3d 573).

Here, the plaintiff demonstrated her prima facie entitlement to judgment as a matter of law on the cause of action to recover legal fees on an account stated in the amount of $18,581.50, with interest from July 11, 2011 (see Bashian & Farber, LLP v Syms, 147 AD3d at 715). In opposition, the defendant failed to raise a triable issue of fact (see Langione, Catterson & Lofrumento, LLP v Schael, 148 AD3d 797). The plaintiff also demonstrated her prima facie entitlement to judgment as a matter of law dismissing the defendant’s counterclaims. The plaintiff’s submissions demonstrated that in representing the defendant, who was also the defendant in the divorce action, she exercised the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, and that the stipulation of settlement executed by the defendant in the divorce action was not the product of any mistakes by the plaintiff (see Schiff v Sallah Law Firm, P.C., 128 AD3d 668, 669). The stipulation of settlement recited, among other things, that the defendant reviewed and understood its terms, had an opportunity to consult with counsel and have the legal and practical effect of the stipulation fully explained to him, executed the stipulation voluntarily, without coercion or pressure of any kind, and believed the stipulation to be fair and reasonable (see Chamberlain, D’Amanda, Oppenheimer & Greenfield, LLP v Wilson, 136 AD3d 1326, 1328; Schiff v Sallah Law Firm, P.C., 128 AD3d at 669). In opposition, the defendant failed to raise a triable issue of fact.”

Experts and Proving Legal Malpractice Cases

Posted in Legal Malpractice Cases

BUFFALO:  Experts are important, no?  The short answer is “of course!”  The longer answer is that they are necessary, absolutely necessary, to plaintiff’s legal malpractice case, as Murray v Lipman 2018 NY Slip Op 04484  Decided on June 15, 2018  Appellate Division, Fourth Department tells us.

“Memorandum: Plaintiff commenced this legal malpractice action seeking damages based on defendants’ representation of her in matters involving workers’ compensation. Defendants moved for summary judgment dismissing the complaint, and Supreme Court granted the motion. We affirm. In order to establish their entitlement to judgment as a matter of law, defendants had to present evidence in admissible form establishing that plaintiff is “unable to prove at least one necessary element of the legal malpractice action” (Giardina v Lippes, 77 AD3d 1290, 1291 [4th Dept 2010], lv denied 16 NY3d 702 [2011]), e.g., ” that the defendant attorney failed to exercise that degree of care, skill, and diligence commonly possessed by a member of the legal community’ ” (Phillips v Moran & Kufta, P.C., 53 AD3d 1044, 1044-1045 [4th Dept 2008]). Here, defendants met their initial burden on the motion with respect to that element (see generally Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). To the extent that plaintiff alleged a violation of the Rules of Professional Conduct (22 NYCRR 1200.0) in opposition to defendants’ motion, we note that “such an alleged violation does not, without more, support a malpractice claim” (Cohen v Kachroo, 115 AD3d 512, 513 [1st Dept 2014]). Inasmuch as plaintiff did not submit an expert’s affidavit “delineating the appropriate standard of professional care and skill’ to which defendants were required to adhere under the circumstances present here,” she failed to raise an issue of fact concerning defendants’ compliance with the applicable standard of care (Zeller v Copps, 294 AD2d 683, 684 [3d Dept 2002]; see Merlin Biomed Asset Mgt., LLC v Wolf Block Schorr & Solis-Cohen LLP, 23 AD3d 243, 243 [1st Dept 2005]; see also Zeller v Copps, 294 AD2d 683, 684-685 [3d Dept 2002]).

The Search For Insurance and Legal Malpractice

Posted in Legal Malpractice Cases

Cohen v Sive, Paget & Riesel, P.C.  Decided on June 14, 2018  Appellate Division, First Department discusses the question of whether it can be legal malpractice not to search for and attempt to apply insurance for the client.  While it may take the case away from counsel, it is of course more beneficial to the client to have a free defense.

“Defendant argues that its failure to advise plaintiffs of the condition in their insurance policy requiring them to provide the insurance company with prompt notice of their claim was not the proximate cause of plaintiffs’ damages. Defendant contends that, by the time plaintiffs retained it as counsel, more than a month had passed since they had learned of the damage implicating the policy, and thus the insurance company would have declined coverage anyway, based on plaintiffs’ unreasonably delayed notice (see Young Israel Co-Op City v Guideone Mut. Ins. Co., 52 AD3d 245 [1st Dept 2008]; Pandora Indus. v St. Paul Surplus Lines Ins. Co., 188 AD2d 277 [1st Dept 1992]). However, the record does not conclusively demonstrate a delay of that length; issues of fact exist as to when the notification obligation was triggered.

Defendant’s contention that the legal malpractice claim should be dismissed as speculative is without merit.”

No Harm, No Foul in a Legal Malpractice Case

Posted in Legal Malpractice Cases

Legal malpractice, to the surprise of many, is a “no harm-no foul” situation in which not only must a mistake be made, but that mistake must have proximate results.  Buongiovanni v Hasin  2018 NY Slip Op 04302 Decided on June 13, 2018  Appellate Division, Second Department is a good example.  Did the first attorney make mistakes?  Perhaps.  Was there a second attorney that could have fixed the mistakes? Perhaps.  When the AD granted a new trial, did it wipe out all the earlier mistakes.  Yes.

“The defendant David V. Hasin, the principal of the defendant Law Office of David V. Hasin, represented the plaintiff in related divorce actions. Hasin was permitted to withdraw as [*2]counsel, and the plaintiff was assigned new counsel. The plaintiff’s assigned counsel was permitted to withdraw as counsel five days prior to the start of the trial in the first action, and the Supreme Court denied the plaintiff’s application for an adjournment to enable her to obtain new counsel and conduct further discovery. The parties proceeded to trial, resulting in a decision after trial and a judgment of divorce dated August 20, 2012.

On November 5, 2014, the plaintiff commenced this action, inter alia, to recover damages for legal malpractice, alleging that Hasin provided her with negligent representation in the divorce actions. In January 2015, the defendants moved, among other things, pursuant to CPLR 3211(a) to dismiss the cause of action alleging legal malpractice, arguing that successor counsel could have remedied any alleged deficiencies in Hasin’s representation. In an order dated March 26, 2015, the Supreme Court, inter alia, denied the branch of the defendants’ motion which was to dismiss the cause of action alleging legal malpractice, noting that “at this point in the litigation, the Court cannot conclude as a matter of law that successor counsel had an adequate opportunity to correct the alleged inadequacies in [Hasin’s] representation.”

“In April 2015, the defendants moved, inter alia, for leave to renew that branch of their motion which was to dismiss the cause of action alleging legal malpractice. In support of their motion, they submitted a decision and order of this Court dated November 19, 2014, which, inter alia, vacated the judgment of divorce and remitted the matter to the Supreme Court to allow the plaintiff to obtain new counsel in the divorce actions and to conduct further discovery (see Buongiovanni v Buongiovanni, 122 AD3d 786). The defendants asserted that they had not located the decision and order dated November 19, 2014, before making their motion to dismiss because they misspelled the plaintiff’s name during an online search for decisions involving the plaintiff. In an order dated June 1, 2015, the Supreme Court, among other things, granted that branch of the defendants’ motion which was for leave to renew, and, upon renewal, in effect, vacated the prior determination and thereupon granted that branch of the defendants’ prior motion which was to dismiss the cause of action alleging legal malpractice.”

“Here, the vacatur of the judgment of divorce in the decision and order dated November 19, 2014, was a new fact not offered on the prior motion to dismiss that would change the original determination (see CPLR 2221[e][2]). The judgment of divorce was vacated based upon the Supreme Court’s improvident exercise of discretion in denying the plaintiff’s adjournment request in the divorce actions (see Buongiovanni v Buongiovanni, 122 AD3d at 788), and in the present action the plaintiff does not seek to recover damages based upon the expenses incurred in connection with her appeal from the judgment of divorce (cf. Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 443). Since the judgment of divorce was vacated and the plaintiff was [*3]afforded an opportunity to retain new counsel and to conduct further discovery, the plaintiff cannot, under these circumstances, establish that she has sustained damages proximately caused by Hasin’s alleged negligent representation (see Katz v Herzfeld & Rubin, P.C., 48 AD3d 640, 641; Perks v Lauto & Garabedian, 306 AD2d 261, 262; Albin v Pearson, 289 AD2d 272, 272-273; cf. Tooma v Grossbarth, 121 AD3d 1093). Further, the defendants’ failure to discover the decision and order dated November 19, 2014, due to a spelling error was tantamount to law office failure which, under the circumstances of this case, constituted a reasonable justification (see Hackney v Monge, 103 AD3d 844, 845; Simpson v Tommy Hilfiger U.S.A., Inc., 48 AD3d 389, 391-392).”

A Deed Forgotten, An Opportunity Missed, Summary Judgment Granted

Posted in Legal Malpractice Cases

In a matrimonial action, every t must be crossed, and every i dotted.  One reason for this is the tremendous emotional and economic issues which often cause irrational conduct.  Hell hath no fury…like a losing matrimonial litigant.  Walker v Kramer  2018 NY Slip Op 04375  Decided on June 13, 2018  Appellate Division, Second Department is an example of how a spouse just won’t comply.

“During the plaintiff’s divorce action, she retained the defendant Kramer & Rabinowitz, LLC (hereinafter the law firm), to represent her. The defendants Lynn Adair Kramer and Gregory Rabinowitz were the members of the law firm. The law firm negotiated a stipulation of settlement between the plaintiff and her former husband wherein the former husband agreed to pay the plaintiff $300,000 as an equitable distribution award. The stipulation provided that the law firm was to prepare a deed transferring ownership of the marital residence from the former husband, who was the sole titled owner, to the plaintiff and the former husband as “joint tenants in common” as a means to secure the husband’s payment of the equitable distribution award to the plaintiff. It is undisputed that the law firm failed to prepare and record the deed, and that the former husband subsequently encumbered the marital residence with a mortgage that had priority over the plaintiff’s claim against the former husband. Thus, the plaintiff was not able to use her anticipated interest in the marital residence to satisfy the $300,000 owed to her by her former husband. The former husband failed to pay the plaintiff her equitable distribution award, and the plaintiff subsequently commenced this action against, among others, Kramer, Rabinowitz, and the law firm (hereinafter collectively the defendants), inter alia, to recover damages for legal malpractice.”

“We agree with the Supreme Court’s determination, upon renewal, to grant those branches of the plaintiff’s cross motion which were for summary judgment on the issue of liability against the law firm and Rabinowitz on so much of the complaint as alleged legal malpractice. The law firm and Rabinowitz do not dispute that they shared an attorney-client relationship with the plaintiff and that they failed to prepare and record the subject deed (see Lory v Parsoff, 296 AD2d 535; Deb-Jo Constr. v Westphal, 210 AD2d 951). The plaintiff, in support of her renewed cross motion for summary judgment, established, prima facie, that the failure to record the deed constituted legal malpractice, resulting in her inability to sell the marital residence to satisfy the [*3]unpaid equitable distribution award, as intended by the stipulation of settlement. The plaintiff, therefore, established her prima facie entitlement to judgment as a matter of law on the issue of liability against the law firm and Rabinowitz. In opposition, the law firm and Rabinowitz failed to raise a triable issue of fact (see Rehberger v Garguilo & Orzechowski, LLP, 118 AD3d 767). For the same reasons, we agree with the court’s determination to deny those branches of the defendants’ separate motions which were for summary judgment dismissing so much of the complaint as sought to recover damages for legal malpractice against the law firm and Rabinowitz.

However, since there are triable issues of fact with respect to the amount of the plaintiff’s damages, upon renewal, the Supreme Court should not have granted that branch of the plaintiff’s cross motion which was for summary judgment on the issue of damages (see e.g. Kryten Iron Works v Ultra-Tech Fabricators, 228 AD2d 416, 417). Accordingly, the matter must be remitted to the Supreme Court, Suffolk County, for a trial on the issue of damages.

We agree with the Supreme Court’s determination to deny those branches of the defendants’ separate motions which were for summary judgment dismissing so much of the complaint as sought to recover attorneys’ fees against the law firm and Rabinowitz based on their legal malpractice. “Damages in a legal malpractice case . . . may include litigation expenses incurred in an attempt to avoid, minimize, or reduce the damage caused by the attorney’s wrongful conduct” (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 443 [internal quotation marks omitted]). The defendants failed to satisfy their prima facie burden of establishing that no such expenses were incurred by the plaintiff.”

The Rare Application of Grace v. Law

Posted in Legal Malpractice Cases

Grace v. Law  is the groundbreaking Court of Appeals case which said, in essence, if you have a meritorious appeal, it must be taken before starting a legal malpractice case.  Application of the doctrine has been spotty.  Leicht v Meyer, Suozzi, English & Klein, P.C.  2018 NY Slip Op 31161(U)  May 17, 2018  Supreme Court, Kings County  Docket Number: 505392/17  Judge: Carl J. Landicino is the latest in this rare breed.

“Plaintiff, a New York City sanitation worker, retained defendants to represent him in the underlying personal injury action involving an accident in which he drove his sanitation Plaintiff, a New York City sanitation worker, retained defendants to represent him in the underlying personal injury action involving an accident in which he drove his sanitation On January 19, 2010, Mack Trucks filed a third-party complaint in the underlying action against Wausau and Truis, Inc. (the manufacturer and distributor of the truck’s bumper assembly, respectively). In December, 2011, the City, Mack Trucks, Truis and Wausau moved for summary judgment dismissing the complaint. By order dated July 10, 2013, this court (Landicino, J.), granted the City’s motion for summary judgment and denied the motions of Mack, Truis and Wausau (id.).

With respect to the City, the court held that it had made a prima facie showing that the subject “low entry sanitation vehicle was a product of a discretionary decision making process and that the product was reasonably safe for its intended use” (id. at 4) and that plaintiff had failed to raise a material question of fact in opposition (id. at 5). With respect to Mack Trucks, the issue was whether the truck, as designed, was reasonably safe for its intended use. Relying upon the testimony of the witnesses forthe City, Truis, and Wausau, Mack Trucks argued that it was ‘”not liable because the vehicle it produced was designed in consultation with the City, was designed after testing the product, and was reasonably safe for its intended use'” (id. at 5-6).”

“By order dated August 12, 2015, the Appellate Division reversed the court’s  decision with respect to these three defendants and granted them summary judgment dismissing the complaint (Leicht v City ofN Y. Dep’t of Sanitation, 131 AD3d 515 [2d Dept. 2015]). In particular, with respect to Mack Trucks, the Appellate Division found that in response to Mack Truck’s primafacie showing, plaintiff had failed to raise a triable issue of fact, namely:

“Although the plaintiff submitted an expert affidavit from an engineer, the expert failed to establish that he was qualified to render an opinion as to the alleged defective design of the Class 8 heavy duty vehicle. An expert is qualified to proffer an opinion if he or she is possessed of the requisite skill, training, education, knowledge or experience from which it can be assumed that the information imparted or the opinion rendered is reliable. Here, the expert failed to present evidence that he had any practical experience with, or personal knowledge of, the vehicle at issue, and the expert also failed to demonstrate such personal knowledge or experience with the design or
manufacture of Class 8 heavy duty vehicles in general. Moreover, the expert’s affidavit, attributing the accident to the defective design of the vehicle, the lack of certain safety devices in the vehicle, and the failure to warn that injury could potentially occur as a result of a head-on collision, was
speculative and conclusory and, therefore, insufficient to raise a triable issue of fact” (id. at 516 [internal citations and quotation marks omitted]).

Accordingly, the Appellate Division dismissed the complaint and cross claims asserted
against Mack Trucks, and dismissed the third-party complaint and all cross claims asserted
against Wausau and Truis (id. at 517).”

On September 14, 2015, plaintiffs moved to reargue the Appellate Division’s decision or, alternatively, for leave to appeal to the Court of Appeals, which was denied by the Appellate Division by order dated December 3, 2015. By letter dated December 12, 2015, defendants memorialized their conversation with plaintiff that the Appellate Division had denied the motion to reargue, that they had advised plaintiff that his final remedy, which they could undertake on his behalf, would be to seek leave from the Court of Appeals to review the Appellate Division’s decision, and that plaintiff had decided not to go forward, which would “effectively end your personal injury case and this. law firm’s representation of you.” The letter was signed by defendant Donnalynn Darling and plaintiff (“I hereby consent and agree to the above”).”

“Relying on Grace v Law (24 NY3d 203 [2014]), defendants also argue that plaintiff failed to sufficiently allege that their purported breach of duty proximately caused plaintiff to sustain actual damages because plaintiff declined to appeal the decision of the Appellate Division to the Court of Appeals, as memorialized in the December 12, 2015 letter signed by defendant Donnalynn Darling and plaintiff (supra). ”

“In Grace, the Court of Appeals addressed the question: “What does a client’s failure to pursue an appeal in an underlying action have on his or her ability to maintain a legal malpractice lawsuit?” (id. at 206). The court adopted the “likely to succeed standard,” namely:
“prior to commencing a legal malpractice action, a party who is
likely to succeed on appeal of the underlying action should be
required to press an appeal. However, ifthe client is not likely
to succeed, he or she may bring a legal malpractice action
without first pursuing an appeal of the underlying action” (id. at

Here, defendants argue that the Appellate Division’s dismissal of plaintiffs claim against Mack Trucks was contrary to the law and the facts of this case, and therefore an appeal would likely have been successful. However, Grace addresses appeals to the Appellate Division, not the Court of Appeals, i.e. the “likely to succeed standard . . . will obviate premature legal malpractice actions by allowing the appellate courts to correct any trial court error and allow attomeys to avoid unnecessary malpractice lawsuits by being given the opportunity to rectify their clients’ unfavorable result” (id. at 210-211).

In any event, defendants have failed to establish that their appeal lies as of right to the Court of Appeals (CPLR 5601) or that the Court of Appeals would have granted plaintiff leave to appeal under CPLR 5602. Even assuming the Court of Appeals would have granted plaintiff leave to appeal the decision and order of the Appellate Division, defendants have failed to demonstrate that the appeal would have been successful, and have therefore failed to show that plaintiff’s decision to forego the appeal is fatal to his claims, as defendants argue.”

A Primer on Legal Malpractice and Its Siblings

Posted in Legal Malpractice Cases

Wow! Furgang & Adwar, LLP v S.A. Intl., Inc.  2018 NY Slip Op 31151(U)  June 6, 2018
Supreme Court, New York County  Docket Number: 651192/2014  Judge: Eileen A. Rakower is a primer on the elements of legal malpractice, breach of contract, breach of fiduciary duty, fraud, as well as how to decide a CPLR 3211 motion and when reargument may be had.  It’s practically a full course on legal malpractice and its siblings.  So, we’ll review the legal malpractice portion today.

“SAI’ s first counterclaim alleges that F &A and Furgang breached their fiduciary duty during their representation of SAI in the trademark dispute. Specifically, SAI claims that F&A and Furgang inter alia overcharged for work allegedly performed approximating $300,000 including costs. As a second counterclaim, SAI alleges that F&A and Furgang committed legal malpractice. The reason being that F &A and Furgang inter alia incorrectly assessed the strength of SAI’ s position in the trademark litigation, incorrectly assessed the strength of a motion to dismiss filed by SAI’s adversary and competitor, advised against negotiation and settlement efforts, and “embroil[ ed] SAi in costly litigation.” (SAI Answer at 15) SAI adds that “But for Furgang’s 1 departure from the ordinary standards of professional conduct and breach of Furgang’ s fiduciary duties, SAi would not have become embroiled in a costly lawsuit and would have benefitted by saving more than $300,000 in legal fees.” (SAi Answer at 15) As a third counterclaim, SAi alleged that that F &A and Furgang breached its contract with SAi by inter alia pursuing a costly and aggressive litigation strategy that avoided  settlement, charging exorbitant amounts that were not justified, and causing SAi to sustain losses in the amount of $300,000. As a fourth counterclaim, SAi alleges that F &A and Furgang breached the implied covenant of good faith and fair dealing by: pursuing resolution of the trademark litigation in a reckless manner that increased expenses and destroyed SAi’ s right to receive the fruits of the contract. This claim especially holds according to SAi because F&A’s agreement with SAi to pursue the trademark litigation in a matter that “did not cost a large sum of money constituted a contract.” (SAi Answer at 16) ”

“To sustain a cause of action for legal malpractice, the plaintiff must show that the attorney 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 the client to sustain actual and ascertainable damages. (Brookwood Companies, Inc., v Alston & Bird LLP, 146 AD3d 662, 666
[1st Dept 201 7].) “An attorney’s conduct or inaction is the proximate cause of a plaintiffs damages if ‘but for’ the attorney’s negligence ‘the plaintiff would have succeeded on the merits of the underlying action’, or would not have sustained ‘actual and ascertainable’ damages.” (Nomura Asset Capital Corp. v Cadwalader, Wickersham & Taft LLP, 26 NY3d 40, 50 [2015].) Accordingly, “the successful
conclusion of the underlying action does not preclude the maintenance of a malpractice action where a claim is made that the defendant attorney’s neglect increased litigation expenses.” (76 NY Jur 2d, Malpractice § 2) Indeed, in Skinner v Stone, Raskin & Israel (724 F2d 264, 265 [2d Cir 1983]), the Court noted, “Whether appellant wins or loses in the [underlying] action, he still will be out of pocket for his expenses in opposing enforcement of the defective default judgment … If these
expenses resulted from [the attorney’s] negligence and were reasonably incurred, they should be recoverable.” (see also VDR Realty Corp. v Mintz, 167 AD2d 986, 986 [4th Dept 1990]) (stating “Plaintiff VDR Realty Corp. may recover damages even though it was successful in the underlying action.”) ”

“SAi states a counterclaim for legal malpractice. Because SAi alleges that F &A incorrectly assessed the strength of SAi’ s position in the trademark litigation, incorrectly assessed the strength of a motion to dismiss filed by SAi’ s adversary and competitor, advised against negotiation and settlement efforts, and embroiled SAi in costly litigation, SAi alleges that F &A “failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession.”
(Brookwood Companies, Inc., v Alston & Bird LLP, 146 AD3d 662, 666 [1st Dept 2017]; SAi Answer at 15) In this regard, SAi’s counterclaim for legal malpractice is not solely based on the excessiveness of F&A’s fee because it is premised on the quality or content of F&A’s legal advice. (Johnson v Proskauer Rose LLP, 129 AD3d at 65) Because SAi claims that “[b]ut for Furgang’s2 departure from the ordinary standards of professional conduct, SAi would … have [saved] more than $300,000 in legal fees”, SAi states that “‘but for’ [F&A’s] negligence[,] [SAi] … would not have sustained ‘actual and ascertainable’ damages.” (Nomura Asset Capital Corp. v Cadwalader, Wickersham & Taft LLP, 26 NY3d 40, 50 [2015].) That the underlying trademark litigation was dismissed in SAi’s favor does not preclude the maintenance of the malpractice action because the counterclaim alleges that F&A’s neglect “increased litigation expenses.” (76 NY Jur 2d, Malpractice§ 2) “If these [300,000] expenses resulted from [F&A’s] negligence and were reasonably incurred, they should be recoverable.” (Skinner v Stone, Raskin & Israel (724 F2d 264, 265 [2d Cir 1983]) Accordingly, SAi “may recover damages even though it was successful in the underlying action.” (VDR Realty Corp. v Mintz, 167 AD2d 986, 986 [4th Dept 1990].) “