Consolidation or a joint trial are subject to judicial discretion.  Judges are said to be the master of their calendar, and the Appellate Division rarely steps in and rearranges it.  Here, inCounty of Westchester v White Plains Ave., LLC 2013 NY Slip Op 02212  Decided on April 3, 2013
Appellate Division, Second Department consolidation is denied as unwieldy.
 

""Where common questions of law or fact exist, a motion to consolidate or for a joint trial pursuant to CPLR 602(a) should be granted absent a showing of prejudice to a substantial right by the party opposing the motion" (Perini Corp. v WDF, Inc., 33 AD3d 605, 606; see Brown v Cope Bestway Express, Inc., 99 AD3d 746, 747-748; Alizio v Perpignano, 78 AD3d 1087, 1088; Mas-Edwards v Ultimate Servs., Inc., 45 AD3d 540). Here, although the action to recover damages for breach of contract (hereinafter Action No. 1) and the action, inter alia, to recover damages for legal malpractice (hereinafter Action No. 2) involve a common question of fact, Action No. 2 involves numerous additional allegations of professional negligence that are irrelevant to Action No. 1. Furthermore, the issues and applicable legal principles in the respective actions are so dissimilar, and the trial may prove so unwieldy, that consolidation will result in jury confusion and prejudice the respondents’ right to a fair trial (see D’Abreau v American Bankers Ins. Co. of Fla., 261 AD2d 501, 502; 197 Merrick Rd. Corp. v 185 Merrick Rd. Assoc. Corp., 152 AD2d 551; Gouldsbury v Dan’s Supreme Supermarket, Inc., 138 AD2d 675, 676; Brown v Brooklyn Union Gas Co., 137 AD2d 479, 480). Accordingly, the Supreme Court properly denied the appellants’ motion pursuant to CPLR 602(a) to consolidate the actions."

Wiggins v Kopko   2013 NY Slip Op 02312  Decided on April 4, 2013   Appellate Division, Third Department  is a primer on attorney fees, contingent fees and what happens when the firm breaks up with the client and with itself.
 

"Kopko contends that plaintiff was discharged for cause due to alleged misconduct in his call to the client. However, without regard to whether the call constituted misconduct — which we do not decide — we agree with Supreme Court that the relevant inquiry is whether the partnership was discharged for cause. The client originally retained Wiggins & Masson — not plaintiff individually — and when Kopko later assumed primary responsibility for the malpractice litigation, he did so on behalf of the partnership or its predecessors, which continued to act as counsel of record in the malpractice action until Kopko was substituted shortly before the trial. Plaintiff was not counsel of record in the malpractice action, and so could not be discharged from that role (see generally Rodriguez v City of New York, 66 NY2d 825, 827-828 [1985])[FN3]. Further, we find no reason to disturb Supreme Court’s determination that neither the partnership nor Wiggins & Masson was discharged for cause. Essentially, the client testified that he had discharged plaintiff because he was angry about plaintiff’s "distasteful" telephone call. However, from the balance of the testimony, it is clear that the client was pleased with the prior services he had received from the partnership and its predecessors (see De Luccia v Village of Monroe, 180 AD2d at 899), specifically including those services rendered by Kopko prior to the substitution.

We therefore agree with Supreme Court that plaintiff is entitled to share in the fee obtained in the malpractice action on the partnership’s behalf. However, we disagree with the further conclusion that the amount should be determined on the basis of quantum meruit. As against a client, a discharged attorney is entitled to a fee determined on a quantum meruit basis at the time of discharge, but different rules apply where, as here, the fee dispute is between attorneys (see Lai Ling Cheng v Modansky Leasing Co., 73 NY2d 454, 457-458 [1989]). In such circumstances, an outgoing attorney may choose to receive immediate compensation on a quantum meruit basis at discharge or to receive a share of a contingent fee based on a proportionate share of the work he or she performed; if no such election is made at the time of discharge, the attorney is presumed to have elected a contingent fee (see Matter of Cohen v Grainger, Tesoriero & Bell, 81 NY2d 655, 658-660 [1993]; Matter of Benjamin E. Setareh, P.C. v Cammarasana & Bilello Esqs., 35 AD3d 600, 601 [2006]; Connelly v Motor Veh. Acc. Indem. Corp., 292 AD2d 332, 333 [2002]; see also Buchta v Union-Endicott Cent. School Dist., 296 AD2d 688, 689 [2002]). Here, Supreme Court found that plaintiff elected quantum meruit compensation in a July 2011 memorandum of law. Even assuming that an election could be made in this manner, it would have been untimely, as the discharge had occurred more than a year earlier. Nothing in the record reveals that an election as to payment of fees was made at or near the time of discharge. Accordingly, as counsel of record, the partnership is presumed to have elected a contingent fee computed according to the proportionate share of work that was performed on its behalf and that of its predecessor firms before the June 2010 substitution of Kopko, to be divided as appropriate between the partners (see Grant v Heit, 10 AD3d 539, 540 [2004], lv denied 4 NY3d 701 [2004]).

Finally, we reject Kopko’s contention that plaintiff and the partnership waived a fee by failing to petition the court for a lien pursuant to Judiciary Law § 475. Such a lien attaches by operation of law for the attorney of record when an action is commenced, even if that attorney is no longer counsel of record upon the action’s conclusion (see Klein v Eubank, 87 NY2d 459, 462-463 [1996]; Matter of Cohen v Grainger, Tesoriero & Bell, 81 NY2d at 657-658). An outgoing attorney’s failure to seek statutory enforcement does not defeat his or her entitlement to [*4]a fee (see Lai Ling Cheng v Modansky Leasing Co., 73 NY2d at 458-459; Ruta & Soulios, LLP v Litman & Litman, P.C., 27 AD3d 236, 236 [2006]). "

New York has a very comprehensive attorney fee-dispute arbitration process, detailed under 22 NYCRR 137.  When does it apply, and how does a legal malpractice claim affect its application? 

Wenig Saltiel, LLP v Secord  2013 NY Slip Op 23104  Decided on March 29, 2013  Appellate Term, Second Department is a nicely detailed explanation.  Law firm was terminated with a letter stating that "defendants were discharging plaintiff "with cause" due to "acts of the firm relating to legal malpractice."  Law firm then sued former clients for fees.
 

"Plaintiff law firm commenced this action in September 2010 to recover legal fees from defendants, whom plaintiff had represented in a prior judicial proceeding. Plaintiff’s verified complaint contains the allegation that part 137 of the Rules of the Chief Administrator of the Courts (22 NYCRR 137.0 et seq.; hereinafter part 137), governing the "Fee Dispute Resolution Program," is inapplicable because the action falls within one of the exceptions to the program, i.e., the claim involves "substantial legal questions, including professional malpractice or misconduct" (Rules of Chief Admin of Cts [22 NYCRR] § 137.1 [b] [3]). Prior to serving an answer, defendants moved to dismiss the complaint, alleging, in an affidavit in support of the motion, that they had signed an August 27, 2009 retainer agreement with plaintiff, and that they [*2]had terminated their relationship with plaintiff on or about July 20, 2010 "for cause and malpractice." They further alleged that the retainer agreement did not include a provision advising them of their right to arbitrate fee disputes; that prior to initiating this action, plaintiff had not sent them notice of their right to arbitrate, pursuant to Rules of the Chief Administrator of the Courts (22 NYCRR) § 137.6; and that plaintiff had not alleged in its complaint compliance with that provision, as required by Rules of the Chief Administrator of the Courts (22 NYCRR) § 137.6 (b). Defendants further contended that plaintiff had excessively billed and overcharged them for the services provided.

In opposition to the motion, plaintiff noted that defendants’ letter dated July 20, 2010 stated that defendants were discharging plaintiff "with cause" due to "acts of the firm relating to legal malpractice," and that, therefore, because defendants’ claim involved "substantial legal questions, including professional malpractice or misconduct" (Rules of Chief Admin of Cts [22 NYCRR] § 137.1 [b] [3]), this action was excepted from the application of part 137. By order dated August 10, 2011, the Civil Court denied defendants’ motion to dismiss, finding that the issue of defendants’ termination of plaintiff based on plaintiff’s alleged legal malpractice was inextricably intertwined with the issue of the reasonableness of the legal fees sought by plaintiff. Accordingly, since defendants’ claim of legal malpractice could not be considered in fee dispute arbitration, defendants’ malpractice claim was a threshold issue to be determined in litigation before the fee dispute could be resolved. We affirm. "

""An attorney who institutes an action to recover a fee must allege in the complaint: (i) that the client received notice under this Part of the client’s right to pursue arbitration and did not file a timely request for arbitration; or (ii) that the dispute is not otherwise covered by this Part" (Rules of Chief Admin of Cts [22 NYCRR] § 137.6 [b]). Plaintiff contends that the complaint in this case properly alleges that the fee dispute is not covered by part 137 because there are substantial legal questions involved regarding plaintiff’s alleged legal malpractice."

"Where an attorney fails to comply with part 137’s pleading requirements, the appropriate remedy will generally be the dismissal of the complaint without prejudice to the commencement of a new action (see Kerner & Kerner v Dunham, 46 AD3d 372 [2007]; Herrick v Lyon, 7 AD3d 571 [2004]; Paikin v Tsirelman, 266 AD2d 136 [1999]; see also Hobson-Williams v Jackson, 10 Misc 3d 58 [App Term, 2d & 11th Jud Dists 2005]). In the instant case, however, the dismissal of the complaint is not warranted at this juncture, as plaintiff did comply with the pleading requirements of part 137 by alleging that part 137 was inapplicable because the claim involves "substantial legal questions, including professional malpractice or misconduct" (Rules of Chief Admin of Cts [22 NYCRR] § 137.1 [b] [3]). Defendants’ letter, stating that they were terminating the attorney-client relationship "for cause and malpractice," in conjunction with their affidavit in support of their motion to dismiss, which specifically references that letter, supports plaintiff’s contention that its pleading did not run afoul of the requirements of part 137. Under these circumstances, and as defendants did not conclusively establish that plaintiff has no cause of action (cf. Lorin v 501 Second St., LLC, 2 Misc 3d 646, 649 [Civ Ct, Kings County 2003]), their motion was properly denied. "

The essentials of legal malpractice litigation, including standing and ascertainable pecuniary loss come up over and over in the Appellate Division cases. Young v Quatela  2013 NY Slip Op 02243
Decided on April 3, 2013   Appellate Division, Second Department is an example.  Plaintiff’s father either suffered the loss or paid for it, and there is some question whether a pecuniary loss happened at all.  Result is is dismissal.
 

"The plaintiff commenced this action against the defendants, inter alia, to recover damages for legal malpractice. The defendants met their prima facie burden of establishing entitlement to judgment as a matter of law (see Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065, 1068). In opposition, the plaintiff failed to raise a triable issue of fact (see Alvarez v Prospect Hosp., 68 NY2d 320, 324). As the plaintiff correctly concedes, nonpecuniary damages may not be recovered in an action alleging legal malpractice (see Dombrowski v Bulson, 19 NY3d 347, 349). Moreover, the plaintiff failed to raise a triable issue of fact as to whether he sustained any pecuniary damages, as the pecuniary losses described in the complaint were incurred by the plaintiff’s father, who is not a party to the action (see Radcliffe v Hofstra Univ., 200 AD2d 562). The plaintiff’s professed intention to repay his father for the expenses incurred on the plaintiff’s behalf amount to a moral obligation, which does not support a viable claim for damages (see Coyne v Campbell, 11 NY2d 372, 375). Accordingly, the Supreme Court properly granted the defendants’ motion for summary judgment dismissing the complaint.
SKELOS, J.P., LEVENTHAL, HALL and SGROI, JJ., concur. "

Breach of Fiduciary Duty has two separate statutes of limitation, six and three years.  Which applies in a legal malpractice case?  Generally the rule is that the choice of six or three years depends on the substantive remedy sought.  If it is for money damages the limit is three years.  If for equitable remedy, then the limit is six years.  Which is disgorgement of attorney fees in a legal malpractice setting?

Access Point Med., LLC v Mandell   2013 NY Slip Op 02208   Decided on April 2, 2013  Appellate Division, First Department    Saxe, J.  says that it is an economic remedy at law, and the limit is three years, regardless of earlier cases which held to the contrary.
"Plaintiffs rely on this Court’s statement that "[d]isgorgement is an equitable remedy" (see J.P. Morgan Sec. Inc. v Vigilant Ins. Co., 91 AD3d 226, 230 [1st Dept 2011], lv granted 19 NY3d 806 (2012). However, the disgorgement remedy referred to in J.P. Morgan Sec. and the cases it discusses is a fundamentally different than the "disgorgement" plaintiff seeks here. Claims for disgorgement most commonly arise in actions brought by the Securities and Exchange Commission in which the agency seeks an order directing a party to disgorge its ill-gotten gains for the recompense of injured investors or some entity other than the prosecuting agency (see J.P. Morgan Sec. Inc. v Vigilant Ins. Co., 91 AD3d 226, 230 [1st Dept 2011], lv granted 19 NY3d 806 [2012] and cases discussed therein). Other types of government agencies or quasi-governmental entities also have sought the disgorgement of wrongfully obtained funds to third parties (see e.g. Morgan Stanley Capital Group Inc. v Pub. Util. Dist. No. 1 of Snohomish County, 554 US 527, 538 [2008]; Montana v Crow Tribe of Indians, 523 US 696 [1998]). Similarly, the equitable disgorgement relief sought by the plaintiff in IDT Corp. v Morgan Stanley (12 NY3d at 139) consisted of profits Morgan Stanley allegedly earned as investment banker for a third party through the third party’s allegedly improper financial dealings with IDT; consequently, the disgorgement of those profits could not necessarily be accomplished simply by awarding IDT a judgment against Morgan Stanley in the amount of funds that it had paid out.

In contrast, plaintiffs’ demand for the return of attorneys’ fees they paid to defendants is, essentially, a claim for monetary damages. The calculated use of the term "disgorgement" instead of other equally applicable terms such as repayment, recoupment, refund, or reimbursement, should not be permitted to distort the nature of the claim so as to expand the applicable limitations period from three years to six. We cannot allow a purely semantic distinction to control the application of the statute of limitations.

Nor do we accept plaintiffs’ alternative argument that the breach of fiduciary duty claim is essentially a fraud claim, to which the six-year statute would be applicable. The amended complaint is based on an alleged conflict of interest and allegedly impaired professional judgment, and it does not allege the elements of fraud (see Buller v Giorno, 57 AD3d 216 [1st Dept 2008]). The failure to disclose a conflict of interest does not transform a breach of fiduciary duty into a fraud.

Another new contention plaintiffs raise on appeal is that the statute of limitations must be treated as tolled, not only pursuant to the continuous representation doctrine, but also under the fiduciary tolling rule, also known as the open repudiation rule.

As the motion court found, no facts are alleged that would justify the application of the continuous representation doctrine to toll the statute of limitations.

Nor, we find, is the fiduciary tolling rule, or open repudiation rule, applicable to plaintiffs’ breach of fiduciary duty claims. Under that rule, the statute of limitations on claims against a fiduciary for breach of its duty is tolled until such time as the fiduciary openly repudiates the role (see Matter of Barabash, 31 NY2d 76, 80 [1972]). The cases in which this [*4]rule arose, and the cases applying it, reflect that the rule arose to protect beneficiaries in the event of breaches of duty by fiduciaries such as estate administrators (see Barabash, 31 NY2d at 80), trustees (see Matter of Ashheim, 111 App Div 176 [1906], affd 185 NY 609 [1st Dept 1906]), corporate officers (see Westchester Religious Inst. v Kamerman, 262 AD2d 131 [1st Dept 1999]), and receivers (see Golden Pac. Bancorp v Federal Deposit Ins. Corp., 273 F3d 509 [2d Cir 2001]), that is, in circumstances in which the beneficiaries would otherwise have no reason to know that the fiduciary was no longer acting in that capacity. In those circumstances, it is appropriate to toll the limitations period until the beneficiary has reason to know that the fiduciary relationship has unequivocally ended.

However, where one party’s fiduciary obligations to another arose out of their attorney-client relationship, and would not have existed without that relationship, there is no need for an open repudiation of the fiduciary’s role, because the attorney’s fiduciary duty to the client necessarily ends when the representation ends. Plaintiffs’ causes of action alleging breach of fiduciary duty specifically assert that defendants’ fiduciary duty to them arose out of their attorney-client relationship with them, thus, their fiduciary relationship ended when their attorney-client relationship ended, without any need for a declaration to that effect.

We recognize that in 212 Inv. Corp. v Kaplan (44 AD3d 332 [1st Dept 2007]), this Court accepted the premise, framed by the parties, that the open repudiation doctrine applies to equitable claims brought by clients against their attorneys, although not to claims for money damages. That decision states, without elaboration, that "the open repudiation’ doctrine tolls the statute of limitations on the [client’s] unjust enrichment claim [against the lawyer], which seeks equitable relief" (id. at 334, citing Matter of Kaszirer v Kaszirer, 286 AD2d 598, 599 [1st Dept 2001], and Westchester Religious Inst. v Kamerman, 262 AD2d 131 [1st Dept 1999]). However, we observe that neither of the cited cases concerned claims against attorneys for breach of their fiduciary duty to their clients arising out of the attorney-client relationship. Matter of Kaszirer concerned a claim by a trust beneficiary against a trustee, and Westchester Religious Inst. involved a claim by a nonprofit corporation against its officers for breach of their fiduciary duty; both of those claims form proper bases for application of the open repudiation rule. And unlike this case, in 212 Inv. Corp., neither party questioned the applicability of the fiduciary tolling rule to an attorney whose fiduciary duty arose out of the attorney-client relationship, so this Court was not required to decide that issue. Presented with the issue now, we reject the application of the fiduciary tolling rule to claims by a client against an attorney for breach of the fiduciary duty arising out of the attorney-client relationship, at least in the absence of a true entitlement to equitable relief. "

We wonder whether legal malpractice is treated differently than all other law suits?  Fielding v Kupferman  2013 NY Slip Op 02008   Decided on March 26, 2013   Appellate Division, First Department raises the question once again.  Compare this case to a garden or varietal slip and fall.  Example:  plaintiff trips over a defective step and breaks his leg.  Would the Appellate Division then discuss whether breaking a bone was better than what might have happened, were plaintiff to fall down an entire flight of stairs and break his neck?  We believe that it would not.
 

Nevertheless, this is what happens regularly in a legal malpractice case.  Take Fielding as an example.  "Defendants established their entitlement to judgment as a matter of law in this action alleging legal malpractice. Defendants submitted evidence showing that the divorce settlement, in which plaintiff achieved his goal of retaining the parties’ marital residence, was advantageous to plaintiff, and resulted in his receiving consideration that more than compensated him for the allegedly unforeseen tax consequences of liquidating his Keogh account (see e.g. Kluczka v Lecci, 63 AD3d 796, 798 [2d Dept 2009]). Defendants also submitted evidence demonstrating that the subject tax consequences were discussed with plaintiff during the course of the settlement negotiations.

In opposition, plaintiff failed to raise a triable issue of fact. His argument that if he had been properly advised on the tax consequences, he would have reached a better settlement or outcome after trial, is speculative (see Klucka at 798). Plaintiff failed to take into account the benefits he received in the actual settlement, including buying out his wife’s share of the marital residence based on an outdated appraisal that assigned a value that was significantly lower than the actual value at the time the agreement was executed. Moreover, plaintiff failed to provide proof of any ascertainable actual damages sustained as a result of the alleged negligence (see Lavanant v General Acc. Ins. Co. of Am., 212 AD2d 450 [1st Dept 1995]). [*2]

Under the circumstances presented, plaintiff’s claim for disgorgement of legal fees already paid was properly dismissed."
 

we’re proud to announce that our article on the Attorney Judgment Rule was published by the New York Law Journal today.

"Medicine and law have ancient parallel histories. Each practices self-regulation, and each has developed deep and extensive internal rules of professional conduct. Both have a tentative claim as one of the world’s oldest professions. Each requires extensive education and testing to join a prehistoric and socially revered cadre. Both require an extensive apprenticeship before acceptance into the guild.

Beyond the obvious ancient quality of the professions, there is a similar intellectual bias evident. Both claim that their decision-making apparatus is unique, internally regulated and virtually unassailable.

Medicine and law share a concept unknown to other professions: the "judgment rule." In medicine, it is aptly summed up in the well-known medical aphorism originally attributed to Armand Trousseau (1801-1867): "Medicine is an art and not a science." For lawyers, it was most forcefully stated by the Court of Appeals in Rosner v. Paley, 65 NY2d 736 (1985). A "mere error of judgment" need not rise to the level of malpractice. When several other alternatives might have been pursued, "selection of one among several reasonable courses of action does not constitute malpractice." For this concept the Court of Appeals looked back to 1897.

Byrnes v. Palmer, 18 AD 1 (2d Dept. 1897), was a Second Department case decided by Judge Edgar M. Cullen, later chief justice of the Court of Appeals, more than 100 years ago. In a conveyancing case the court held that "It is undoubtedly true that an attorney is only bound to exercise the ordinary reasonable skill and knowledge of his profession, and is not liable for every error of judgment or opinion as to the law." Byrnes at 5.

Byrnes itself looked further backward to Montriou v. Jefferys (2 Car. & P. 113 (1825)). There, Chief Judge Charles Abbot, 1st Baron Tenterden of England, stated that "No attorney is bound to know all of the law; God forbid that it should be imagined that an attorney, or a counsel, or even a judge, is bound to know all the law, or that an attorney is to lose his fair recompense on account of an error, being such an error as a cautions man might fall into." "In a litigation a lawyer is well warranted in taking chances. To some extent litigation is a game of chance. The conduct of a lawsuit involves questions of judgment and discretion as to which even the most distinguished members of the profession may differ. They often present subtle and doubtful questions of law. If in such cases a lawyer errs on a question not elementary or conclusively settled by authority, that error is one of judgment for which he is not liable."
 

Plaintiff is the administratrix of decedent’s estate.  This is a very sad story.  Decedent entered United Presbyterian Residence after a stroke, and was the victim of a most avoidable problem:  pressure ulcer, or more commonly, a bedsore.  It eventually, and after much suffering, killed her.  Her family hired an attorney to sue the residence, and the attorney failed to start the case.  Later the attorney was disbarred when he was convicted of a felony.

Corsiatto v Maddalone  2013 NY Slip Op 30553(U)  March 13, 2013  Supreme Court, Suffolk County  Docket Number: 2009-14305  Judge: John J.J. Jones Jr is mostly the story of bad medical care.  It was an inquest, so we guess that there was no legal malpractice insurance.  It may have been a Pyrrhic or a technical victory.

"The medical record indicates that although a wound care specialist was ordered, the decedent was never seen. No order was written for culture of the wound at the decubitus site; no orders were made to obtain blood cultures, both departures from good and accepted medical standards. According to Knieste, the poor management of the decedent’s Stage IV pressure sore was contrary to good and accepted medical practice and a contributing cause of the formation of a Stage IV pressure ulcer, the decedent’s continued suffering, and death. The decedent’s discharge note contained a diagnosis of sepsis."

"The issue of causation has been resolved in the plaintiffs favor due to the defendant’s default, that is, it is established that the plaintiff would have prevailed in the underlying action against UPR. However, it is not established that the plaintiff would have prevailed on all three claims: medical malpractice, negligence and the statutory claim under Public Health Law ij 2801 – d(1). At least one court has addressed the distinction between medical malpractice and negligence claims on the one hand, and a statutory cause of action under the Public Health Law on the other. See Butler v. Shorefront Jewish Geriatric Center, 33 Misc.3d 686, 693, 932 N.Y.S.2d 672 (Kings Sup. Ct. 2011)."

"The court is obliged to award an amount in compensatory damages that does not materially deviate from what would be considered “reasonable compensation” under the Circumstances given the plaintiffs injuries (CPLR 5501 (c); Slzurgan by Shurgan v. Tedesco, 179 A.D.2d 805, 578 N.Y.S.2d 658 [2d Dept.19921). Although the plaintiff assented to conduct the inquest “on papers”, the court has not been provided with any comparable awards or verdicts for similar injuries of comparable duration to assist the court’s determination of what can be considered reasonable compensation for the decedent’s pain and suffering. The court has found several cases where patients have endured pressure sores similar to that endured by the decedent. For example, in Parson v. Interfaith Medical Center, a jury verdict of $1,000,000 was reduced to $400,000 to compensate the plaintiffs decedent for the mismanagement of her numerous bedsores that were a cause of her death (Parson v. Interfaith Medical Center, 267 A.D.2d 367, 700 N.Y.S.2d 224 [2d Dept. 1999).