“Actual Innocence” is a huge burden to overcome.  It is necessary to demonstrate that standard in order to plead a legal malpractice claim arising from representation in a criminal defense case.  Even if you can show actual innocence, as in Broomes v Legal Aid Socy. of N.Y. City, Inc., 2022 NY Slip Op 06101  Decided on November 2, 2022  Appellate Division, Second Department NY courts have held that only “pecuniary damages” are permitted.  Mere incarceration, even when wrong, does not give rise to legal malpractice damages,

“In March 2020, the plaintiff commenced this legal malpractice action against the defendants, the Legal Aid Society of New York City, Inc., and Paul Liu, seeking both pecuniary and nonpecuniary damages. The complaint alleged that the defendants were negligent in their representation of the plaintiff in a prior criminal action in which he was convicted of a crime upon his plea of guilty and sentenced to a term of imprisonment. The plaintiff’s conviction in that action was vacated in 2019 on the ground of ineffective assistance of counsel, and the indictment was dismissed.”

“The Supreme Court properly granted that branch of the defendant’s motion which was for summary judgment dismissing so much of the complaint as sought to recover nonpecuniary damages. Generally, recovery for legal malpractice is limited to pecuniary damages (see [*2]Dombrowski v Bulson, 19 NY3d 347Dawson v Schoenberg, 129 AD3d 656, 658; Young v Quatela, 105 AD3d 735, 736; Brownell v LeClaire, 96 AD3d 1336Wolkstein v Morgenstern, 275 AD2d 635, 637).”

The First Department decided Basile v. The Law Offices of Neil Brickman, P.C.,  this week, giving further dimension to how it decides continuing representation issues.  Here, communications with the law firm, even after a long period, can suffice for continuing representation.

“Order, Supreme Court, New York County (Shawn T. Kelly, J.), entered on or about September 23, 2021, which denied defendants’ motion to dismiss plaintiff’s third
cause of action, for legal malpractice, pursuant to CPLR 3211 (a)(1), (a)(5), and (a)(7), unanimously affirmed, without costs.

The legal malpractice claim may not be barred by the three-year statute of limitations (CPLR 214[6]). Plaintiff contends that the claim was tolled by the continuous
representation doctrine based on alleged emails and telephone conversations about collecting on plaintiff’s money judgment against the judgment debtor following its entry
in 2010, at which time the judgment debtor did not have sufficient assets to satisfy the judgment. Defendants, however, assert that there was no continuous representation because plaintiff had no communication with them concerning collecting on the unsatisfied judgment until August 2019, when the limitations period on the instant claim had expired. These factual contentions concerning whether defendant continued to represent plaintiff during the relevant time period so as to toll the limitations period give rise to factual issues that cannot be resolved in this pre-answer motion to dismiss (see Boesky v Levine, 193 AD3d 403 [1st Dept 2021]; Johnson v Law Off. of Kenneth B. Schwartz, 145 AD3d 608, 612 [1st Dept 2016]).”

Grace v. Law is a Court of Appeals case which holds that a legal malpractice case cannot successfully be pursued unless an appeal of the underlying negative outcome is commenced when it is likely that the appeal will succeed.  In a novel argument, plaintiff in Colucci v Rzepka  2022 NY Slip Op 06043  Decided on October 27, 2022  Appellate Division, Third Department argues that it was not permitted, or was “forced” to delay the commencement of the legal malpractice case until its appeal of the underlying negative outcome was decided.  Because of the typical lag time for an appeal to be heard and decided, more than three years ensued from both the negative decision in the underling case as well as the end of representation.

“Plaintiff Lora Colucci, who was the owner of plaintiff Yar-Lo, Inc., entered into a lease in 1990 with Stuyvesant Plaza, a shopping center, to operate a cosmetics store. During the lease period, the leased premises experienced sewage system backup and overflows that purportedly exposed the store to mold and raw sewage. In 2005, plaintiffs terminated the lease and submitted a claim to Travelers Indemnity Company, their commercial insurer, for business interruption coverage, which was denied. They subsequently retained defendant Thomas J. Rzepka to commence litigation against Travelers, for the wrongful denial of the insurance claim, and against Stuyvesant Plaza, for breach of the lease. Rzepka initiated an action on behalf of Yar-Lo against Travelers in December 2006 that was dismissed by Supreme Court (Caruso, J.) upon summary judgment, which order this Court affirmed (Yar-Lo, Inc. v Travelers Indem. Co., 130 AD3d 1402, 1404 [3d Dept 2015]).

In 2007, Rzepka instituted an action on behalf of plaintiffs against Stuyvesant Plaza seeking damages stemming from Colucci’s personal injuries due to her exposure to the raw sewage and mold as well as the closure of her business. Following prolonged discovery, Supreme Court (Kramer, J.) directed plaintiffs and Stuyvesant Plaza to submit expert disclosure by May 2015 and all dispositive motions by August 2015. Stuyvesant Plaza timely filed expert disclosures pertaining to plumbing and medical experts as well as a motion for summary judgment seeking dismissal of the complaint based on plaintiffs’ failure to submit any expert proof that Colucci’s injuries and damages were caused by its actions. Rzepka did not comply with the deadlines but requested an adjournment of the return date for responsive papers to the summary judgment motion. The court granted the adjournment, which was conditioned upon Rzepka’s consent that the deadline for expert disclosure would not be similarly extended. Rzepka obtained another adjournment of the return date and, in the meantime, submitted a cross motion for summary judgment with incomplete supporting papers. On the day of the new return date, Rzepka moved to withdraw from his representation of plaintiffs, which he ceased by affirmation in December 2015.”

“In May 2020, plaintiffs commenced this legal malpractice action seeking, among other things, damages arising from Rzepka’s representation in plaintiffs’ action against Stuyvesant Plaza. Defendants Osborne Reed & Burke, LLP, Bressler & Kunze, Burke Albright Harter & Reddy, LLP and Moyer Russi & Randall, PC (hereinafter collectively referred to as the law firms) respectively moved pre-answer to dismiss the complaint against them as time-barred and for failure to state a cause of action (see CPLR 3211 [a] [5], [7]). Rzepka joined issue but did not submit any dispositive motions. In turn, plaintiffs opposed all of the motions to dismiss, except for the one by Burke Albright Harter & Reddy. Ultimately, Supreme Court (Corcoran, J.) determined, among other things, that the action was time-barred against the law firms and dismissed the complaint as against them. Plaintiffs appeal.

We affirm. “An action to recover damages arising from legal malpractice must be commenced within three years after accrual” (Zorn v Gilbert, 8 NY3d 933, 933-934 [2007] [citation omitted]; see CPLR 214 [6]). In the civil context, the claim “accrues when the malpractice is committed” (Ruggiero v Powers, 284 AD2d 593, 594 [3d Dept 2001], lv dismissed 97 NY2d 638 [2001]), “not at the time that the injury is discovered” (Lavelle-Tomko v Aswad & Ingraham, 191 AD3d 1142, 1143 [3d Dept 2021]; see McCoy v Feinman, 99 NY2d 295, 301 [2002]). ”

“Plaintiffs failed to meet their shifted burden. Specifically, plaintiffs erroneously rely upon Grace v Law (24 NY3d 203 [2014]) for the proposition that they were not permitted to commence this action until the appeal of the Stuyvesant Plaza action [*3]was resolved in January 2018. In Grace v Law, the Court of Appeals held “that 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, if the client is not likely to succeed, [the client] may bring a legal malpractice action without first pursuing an appeal of the underlying action” (id. at 210 [emphasis added]). Here, given Supreme Court’s “broad discretion in controlling discovery and disclosure” (Colucci v Stuyvesant Plaza, Inc., 157 AD3d at 1098 [internal quotation marks and citations omitted]), plaintiffs’ appeal from the Stuyvesant Plaza action was not “likely to succeed,” such that it was not necessary for them to file an appeal pursuant to the standard set forth in Grace v Law (24 NY3d at 210; see Florists’ Mut. Ins. Co., Inc. v Behman Hambelton, LLP, 160 AD3d 502, 502 [1st Dept 2018]).[FN1] Thus, plaintiffs were not “forced” to file an appeal prior to commencing the legal malpractice action. If plaintiffs believed the best course of action was to also file an appeal, they were certainly free to, but this did not toll the statute of limitations.[FN2] Rather, the preferable course of action would have been to both timely commence the legal malpractice action and pursue an appeal and then request a stay of the legal malpractice action until determination of the appeal (see Spitzer v Newman, 163 AD3d 1026, 1027-1028 [2d Dept 2018]). Accordingly, Supreme Court did not err in granting the law firms’ motions to dismiss the complaint as untimely. In light of this determination, plaintiffs’ remaining contentions have been rendered academic.”

Schnur v Balestriere   2022 NY Slip Op 05297  Decided on September 27, 2022 Appellate Division, First Department describes what the First Department thinks a good Judiciary Law § 487 claim requires:  deceit, egregiousness and good pleading.

“The Judiciary Law § 487 claim against Balestriere should not have been dismissed. Although “unfounded” allegations are not actionable under Judiciary Law § 487, deliberate misrepresentations are (see Amalfitano v Rosenberg, 12 NY3d 8, 11-15 [2009]; Ticketmaster Corp. v Lidsky, 245 AD2d 142, 143 [1st Dept 1997]; Redmond v Bailey, 2012 NY Slip Op 31081[U], *6 [Sup Ct, Queens County 2012]). Plaintiffs have sufficiently alleged that the allegations about them in the underlying federal action were not just unfounded but intentionally false; these allegations have not been conclusively refuted. The misconduct alleged by plaintiffs is also sufficiently “egregious” to support a Judiciary Law § 487 claim — consisting of the reiteration of allegations Balestriere knew to be false in multiple filings, even after receipt of information refuting these allegations and even after being sanctioned (see generally Facebook, Inc. v DLA Piper LLP [US], 134 AD3d 610, 615 [1st Dept 2015], lv denied 28 NY3d 903 [2016]).”

In Bei Yang v. Pagan Law Firm P.C.  Slip Opinion No: 2022 NY Slip Op 73132(U), Decided on October 18, 2022 the Appellate Division, First Department, determined that Plaintiff may not use a pseudonym in a legal malpractice law suit.

“And plaintiff-appellant having moved, pro se, to suppress allegedly improperly obtained privileged information of psychotherapy notes from Dr. Mikki Meyers; suppress allegedly privileged medical records and a laboratory report from Dr. Bina Mody; deny, limit or regulate defendants’ submissions containing alleged defamatory statements and untruths associated with “Defendants’ Three-Step Abuse of Disclosure  Devises”; and for permission to use a pseudonym in the instant appeal, the legal malpractice lawsuit and the underlying medical malpractice lawsuit,

Now, upon reading and filing the papers with respect to the motion, and due deliberation having been had thereon, It is ordered that the motion is denied in its entirety.”

Sometimes the AD finds that a consent to change attorney is the terminating event for continuous representation and sometimes not. Ellison v Seltzer,  2022 NY Slip Op 05786
Decided on October 18, 2022  Appellate Division, First Department is a case where the “mutual understanding of the need for further representation” trumped the “failure to move to be relieved” standard.

“Supreme Court correctly determined that the legal malpractice claim was barred by the three-year statute of limitations (CPLR 214 [6]). While the claim accrued at the latest on September 23, 2016, the continuous representation doctrine tolled the statute of limitations until December 8, 2016, when defendants informed plaintiff that they would not represent him on his appeal in the underlying employment action, but plaintiff did not commence this action until December 13, 2019 (see Shumsky v Eisenstein, 96 NY2d 164, 170-171 [2001]). Contrary to plaintiff’s contentions, the outstanding counterclaim in the employment action and defendants’ failure to move to be relieved in that action did not show a mutual understanding of a need for further representation (see McCoy v Feinman, 99 NY2d 295, 306 [2002]; Farina v Katsandonis, P.C., 197 AD3d 1033, 1033-34 [1st Dept 2021]; Hirsch v Fink, 89 AD3d 430, 431 [1st Dept 2011]).”

Lee v Leifer  2022 NY Slip Op 05793  Decided on October 18, 2022  Appellate Division, First Department is the startling story of an attorney who told his client that it was better and more efficient not to answer a complaint.  The strategy worked well, until it didn’t.

“The Leifer defendants (Leifer) represented Lee in a lawsuit against him, which arose out of Lee’s ownership of a restaurant. Lee alleges that Leifer erroneously informed him that the damages sought were limited to an agreed-upon purchase price, although the plaintiff in that case actually sought significantly more in punitive damages. Lee further alleges that, on Leifer’s advice, he did not file an answer. The court found that Lee had failed to assert a meritorious defense to the punitive damages claim and entered a default judgment for the plaintiff. At an inquest, the court awarded punitive damages of $700,000, as well as compensatory damages, interest, and attorneys’ fees. Lee has appealed to the Second Department. Lee sued for legal malpractice. The motion court denied Leifer’s motion to dismiss.

Lee’s legal malpractice complaint adequately alleges that Leifer’s failure to advise him of the punitive damages claim asserted against him in the underlying action and failure to file a responsive pleading, “proximately caused plaintiff to sustain actual and ascertainable damages,” i.e., that he would not have incurred the punitive damages award but for Leifer’s negligence (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]). Lee claims that he would have avoided the punitive damages award by asserting a meritorious defense in his responsive pleading. However, Lee’s default required the court to accept as true all allegations against him as to liability (see Amusement Bus. Underwriters v American Intl. Group, 66 NY2d 878, 880 [1985]). While Lee had the opportunity to contest the punitive damages claim at the subsequent damages inquest, he was not permitted to introduce evidence to counter the underlying cause of action (Suburban Graphics Supply Corp. v Nagle, 5 AD3d 663, 665 [2d Dept 2004]).

Although the inquest court rejected the substance of Lee’s purportedly meritorious defense, it did so on a limited record. “[W]hile [defaulting] defendants are entitled to present testimony and evidence and cross-examine the plaintiff’s witnesses at the inquest on damages, they may not conduct discovery” (Rudra v Friedman, 123 AD3d 1104, 1005 [2d Dept 2014] [internal quotation marks omitted]). Because Lee, having defaulted, forfeited the right to discovery, he was deprived of the opportunity to amass a record on which the inquest court might have credited his defense to the punitive damages claim.”

In York v Frank  2022 NY Slip Op 05738  Decided on October 12, 2022  Appellate Division, Second Department, after discarding the statute of limitations as a reason to dismiss, the Second Department took up an alternative reason to dismiss.  This was done even though the parties did not address the issue.

“Although the Supreme Court did not address the defendants’ contention that the amended complaint should be dismissed pursuant to CPLR 3211(a)(7) for failure to state a cause of action, we reach that issue as an alternative ground for affirmance (see Parochial Bus Sys. v Board of Educ. of City of N.Y., 60 NY2d 539, 544-546; Kauffman v Turner Constr. Co., 195 AD3d 1003, 1005).

“On a motion pursuant to CPLR 3211(a)(7) to dismiss a complaint, the pleading is to be afforded a liberal construction” (Farber v Breslin, 47 AD3d 873, 876; see Bernhardt v Schneider, 190 AD3d 919, 920). To state a valid cause of action alleging legal malpractice, the plaintiff must plead sufficient facts to “show that an attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession” (McCoy v Feinman, 99 NY2d 295, 301 [internal quotation marks omitted]; see Ackerman v Kesselman, 100 AD3d 577, 579). The “plaintiff must [also] show that he or she would have prevailed in the underlying action or would not have incurred any damages but for the attorney’s negligence” (Mackey Reed Elec., Inc. v Morrone & Assoc., P.C., 125 AD3d 822, 823). In addition, the plaintiff must plead actual and ascertainable damages that resulted from the alleged legal malpractice or that “might be reasonably inferred” (id. at 823; see McCoy v Feinman, 99 NY2d at 301-302; Hall v Hobbick, 192 AD3d 776, 778).

Here, the plaintiff failed to plead sufficient facts to state a cause of action alleging legal malpractice in connection with the divorce action. The plaintiff’s allegations as to how the Supreme Court might have ruled had her attorney moved ex parte for an order of preclusion were speculative (see Denisco v Uysal, 195 AD3d 989, 991). Moreover, the plaintiff’s allegations that the failure of the defendants to make such an application constituted negligence were conclusory (see [*3]Katsoris v Bodnar & Milone, LLP, 186 AD3d 1504, 1506; Hashmi v Messiha, 65 AD3d 1193, 1194-1196). Further, the plaintiff’s allegation that she sustained actual and ascertainable damages as a result of the defendants’ negligence also was conclusory and speculative (see Katsoris v Bodnar & Milone, LLP, 186 AD3d at 1506; Bua v Purcell & Ingrao, P.C., 99 AD3d 843, 847-848). In sum, “the conclusory allegations of the [amended] complaint failed to adequately plead specific facts to establish that, but for the defendants’ alleged negligent conduct, the outcome in the underlying action would have been any more favorable to the plaintiff[ ], or that the plaintiff[ ] would not have incurred any damages” (Kahlon v DeSantis, 182 AD3d 588, 589; see Denisco v Uysal, 195 AD3d at 991; Janker v Silver, Forrester & Lesser, P.C., 135 AD3d 908, 910; Hashmi v Messiha, 65 AD3d at 1195; cf. McCoy v Feinman, 99 NY2d at 305; Stewart Tit. Ins. Co. v Wingate, Kearney & Cullen, 134 AD3d 924, 924-925).”

Courts determine when the statute of limitations begins to run against an attorney in one of two general ways.  Either continuous representation ends when there is no longer a relationship of trust and confidence (acrimonious communication) or when the attorney withdraws.  Both can be the basis for the onset of the statute.  In York v Frank  2022 NY Slip Op 05738  Decided on October 12, 2022  Appellate Division, Second Department takes the more conservative position, which it does not always do.

“On October 5, 1999, the plaintiff entered into a retainer agreement with the defendant Blank Rome, LLP, formerly known as Tenzer Greenblatt, LLP (hereinafter the law firm), to provide legal representation, inter alia, in a divorce action. The defendant Donald Frank, an attorney with the law firm, executed the retainer agreement on behalf of the law firm. The attorney-client relationship subsequently deteriorated, and in an order dated June 8, 2001, the Supreme Court, inter [*2]alia, granted that branch of the defendants’ motion which was to withdraw as counsel for the plaintiff in the divorce action. On August 15, 2001, the plaintiff retained new counsel.

On June 2, 2004, the plaintiff commenced this action to recover damages for legal malpractice. Thereafter, the defendants moved pursuant to CPLR 3211(a) to dismiss the amended complaint on the grounds, inter alia, that it was time-barred and that it failed to state a cause of action. In an order entered March 28, 2019, the Supreme Court, among other things, granted the defendants’ motion to dismiss the amended complaint on the ground that it was time-barred. The plaintiff then moved for leave to reargue her opposition to the defendants’ motion. In an order entered September 16, 2019, the court, inter alia, denied the plaintiff’s motion for leave to reargue. In a judgment entered September 19, 2019, the court dismissed the amended complaint. The plaintiff appeals.

“An action to recover damages for legal malpractice must be commenced within three years from the accrual of the claim” (Farage v Ehrenberg, 124 AD3d 159, 163; see CPLR 214[6]). “Accrual is measured from the commission of the alleged malpractice, when all facts necessary to the cause of action have occurred and the aggrieved party can obtain relief in court, regardless of when the operative facts are discovered by the plaintiff” (Farage v Ehrenberg, 124 AD3d at 164 [citations omitted]; see Shumsky v Eisenstein, 96 NY2d 164, 166). The doctrine of continuous representation tolls the three-year statute of limitations “for the period following the alleged malpractice until the attorney’s continuing representation of the client on a particular matter is completed” (Farage v Ehrenberg, 124 AD3d at 164).

Here, the defendants failed to establish, prima facie, that the action was commenced more than three years after the plaintiff’s claims alleging legal malpractice in connection with the divorce action accrued. The plaintiff commenced this action by filing a summons with notice on June 2, 2004 (see CPLR 304(a); Jones v Bill, 10 NY3d 550, 554; LeBlanc v Skinner, 103 AD3d 202, 208). Based on the defendants’ submissions, the parties’ attorney-client relationship did not end until at least June 8, 2001, when the Supreme Court granted that branch of the defendants’ motion which was to withdraw as counsel for the plaintiff in the divorce action (see Tulino v Hiller, P.C., 202 AD3d 1132, 1135; Garafalo v Mayoka, 151 AD3d 1018, 1019; Farage v Ehrenberg, 124 AD3d at 165). Thus, in this action, the Supreme Court should not have granted dismissal of the amended complaint on the ground that it was time-barred.”

Purchase at an auction at your risk.  That is one of the lessons in Markov v Barrows  2022 NY Slip Op 04780 [208 AD3d 401]  August 2, 2022  Appellate Division, First Department.  Of course, what is true in the underlying case is true in a legal malpractice case which follows the purchase of a medal which did not live up to its description.

“This legal malpractice action stems from defendant’s representation of plaintiff in a prior action in which plaintiff sought to recover damages he allegedly sustained after purchasing at auction a particular medal that he asserted was worth far less than his winning bid. Plaintiff alleges that defendant failed to timely sue the proper parties—namely, Stack’s LLC and its auctioneers—leading to the dismissal of the prior action and precluding any recovery by plaintiff for alleged misrepresentations by Stack’s and the auctioneers regarding the materials comprising the medal.

Supreme Court properly dismissed plaintiff’s legal malpractice cause of action in the original complaint because he failed to allege that “but for” defendant’s negligent conduct, he would have prevailed in the underlying action (Weil, Gotshal & Manges, LLP v Fashion Boutique of Short Hills, Inc., 10 AD3d 267, 272 [1st Dept 2004]; see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]). Plaintiff’s citation to a ruling in the underlying action denying dismissal of his fraud claim, among others, did not, without more, show that he would have prevailed in the underlying action had defendant timely commenced it by naming the proper parties in the original complaint (see Sonnenschine v Giacomo, 295 AD2d 287, 287 [1st Dept 2002]).”

“By placing a bid in the auction, plaintiff, a numismatic dealer who buys, sells, and collects Russian coins and medals, acknowledged receipt of the auction catalog and agreed to adhere to the terms of sale (see Terms of Sale ¶¶ 5, 40). Bidders were “encouraged to carefully examine all lots prior to sale,” because the lots would not be shown at the sale (Terms of Sale ¶ 15; see Terms of Sale ¶ 26). Stack’s assumed no liability for the facts stated concerning the items in the auction, except as specified in the terms of sale (Terms of Sale ¶¶ 15, 18 [k]; see Terms of Sale ¶ 31 [“Stack’s hereby disclaims all liability for damages, incidental, consequential or otherwise, arising out of or in connection with the sale of any property by Stack’s to purchaser”]). While offering a limited warranty “that any numismatic item sold is authentic (i.e., not counterfeit, that its date or mintmark has not been altered, and that the coin has not been repaired as those terms are used in the trade),” Stack’s made clear that “all other warranties of authenticity of authorship, whether express or implied, [were] disclaimed” (Terms of Sale ¶ 16). Elsewhere in the terms of sale, Stack’s warned bidders (in bold text) that, “[e]xcept as otherwise expressly stated in the Terms of Sale, Stack’s and its agents and employees make no warranties or guaranties or representations, and expressly disclaim all warranties and guaranties and representations, including, without limitation, a warranty of merchantability, in connection with any numismatic properties sold by Stack’s” (Terms of Sale ¶ 18 [h]; see Terms of Sale ¶ 18 [i] [“All oral and written statements made by Stack’s are statements of opinion only and are not warranties or representations of any kind, unless stated as a specific written warranty, and no employee or agent of Stack’s has authority to vary or alter these Terms of Sale”]).

In light of the constellation of disclaimers and conditions in the terms of sale, plaintiff cannot demonstrate that, but for defendant’s alleged legal malpractice, plaintiff would have prevailed in the underlying action against Stack’s and the auctioneers.”