It’s medical malpractice which is something we don’t usually write about, but Justice Schlesinger’s opinion in this medical malpractice summary judgment opinion is well worth reading.  Balzola v Giese  2013 NY Slip Op 30324(U)  February 5, 2013  Supreme Court, New York County  Docket Number: 114205/2009  Judge: Alice Schlesinger slowly and thoroughly works it way through a medical malpractice – hearsay – summary judgment problem.

"The plaintiff, her widower and Administrator of the estate, is Pablo Balzola. It is his account of Ms. Porras’ last days which forms the critical part of this action, one sounding in wrongful death and medical malpractice, It is also the critical part of the motion now before me by the defendants, a motion to dismiss the action in its entirety. His account is so critical because Mr. Balzola, at his deposition, testified about the symptoms his wife was having as she reported them to him. Those symptoms, which included chest pains and shortness of breath, form a good part of the predicate
for the opinions provided by Dr. Mark Taff, a Pathologist and Chief Medical Examiner of Rockland County and expert for plaintiff on the issue of causation, as well as for the opinions provided by a board certified plastic surgeon and expert for the plaintiff on the issue of departures. The moving defendants are her doctor, Sharon Giese, who performed this elective surgery on June 25, her P.C., and Sarah Lazarus, her Physician’s Assistant. Pursuant to CPLR 53212, they are all moving for summary judgment.

In other words, counsel for defendants argues that, even if there had been malpractice, there is no merit to the plaintiff‘s contention that the embolism which killed Ms. Porras could have been treated, in other words, that there was time to treat it. This is from a pathology perspective. 

After reviewing pathology slides, Dr. Factor states that he is able to ascertain the timing of the decedent’s fatal pulmonary embolism, In his affirmation he opines that “the fatal pulmonary embolism was acute, fresh, and traveled to the decedent’s lung only 20 to 30 seconds prior to the decedent’s acute cardiopulmonary failure.” (79, emphasis in the original). Dr. Factor further opines, also with a reasonable degree of medical certainty, that “after forming, the thrombus broke off from a vein in decedent’s lower extremity and traveled to (her) pulmonary artery only moments before it caused the acute cardiopulmonary failure and her ultimate death.” (71 0, emphasis in the original).
Finally, and this is of great significance, Dr. Factor states that ‘“he decedent would not have experienced any symptoms related to the fatal pulmonary embolism at any time prior to the moments immediately before she lost consciousness in the late evening of Saturday, June1 27, 2009”. (71 1, emphasis in the original). Thus, Dr. Factor concludes that there would have been no time for Ms. Porras to seek medical assistance. In other words, he either challenges the veracity of Mr. Balzola’s testimony regarding the reported symptoms, or he feels the symptoms are not related to the embolism.Plaintiff confronts these opinions and submits two of his own expert affirmations to refute them.

However, as alluded to earlier, what is largely determinative of this motion and action is the issue of causation. For as we all know, the defendant doctor might have been grossly negligent or terribly uncaring or worse, but if such I behavior would not have made any difference in the ultimate outcome, the tragic death of Adriana Porras, then the action must fail. Dr. Taff tells us that in his role as Chief Medical Examiner of Rockland County, he was present at the June 29, 2009 autopsy of the decedent.’ He then states that his opinions rely not only on the medical records, litigation documents and affirmations of the defense experts, but also on his own observations during the autopsy. He then recites the cause of death as was reported in the Autopsy Report. Immediately
thereafter, he gives his opinion “within a reasonable degree of medical certainty that based upon the results of the autopsy, there was sufficient time to intervene to treat her pulmonary emboli and the failure of the defendants … to take any action deprived her of a substantial chance of cure and was the proximate cause of her death.” (Exh A to Opposition, 76).
 

However, Dr. Taff relies on more than “the results of the autopsy” to arrive at this conclusion. Later on in his affirmation, he discusses the testimony of Mr. Balzola as to the complaints made to him by his wife in the post-operative days, Friday and Saturday, June 26 and June 27, 2009. He relates those symptoms to his observations and explains how the latter were responsible for the former.  Specifically in this regard, Dr. Taff states that during the autopsy “we found” that rather than seeing one massive clot to the lung, in fact “both of her lungs contained multiple small clots obstructing both lungs as well as one large clot lodged in the pulmonary artery and branches.” (VI 3). This physician then agrees with the report’s conclusion that it was the larger clot that caused Ms. Porras’ death, as it broke off and traveled to her lung.

However, Dr. Taff then goes on to opine, within a reasonable degree of medical certainty, that these smaller clots or “bits and pieces of the thrombosed right popliteal vein” were the cause of the “shortness of breath and chest pains” which Ms. Porras complained of to her husband on the Friday and Saturday after the surgery.In other words, the smaller clots were not enough to “completely obstruct her lung function” but were enough to diminish that function to the extent of causing her to ‘experience shortness of breath and chest pain. "

We suggest that you read the balance of the opinion, which goes on to discuss hearsay, the present sense exception and summary judgment as well as the balancing of expert opinions and fact observations.

 

 

Hsu v Liu & Shields LLP  2013 NY Slip Op 30291(U)  February 7, 2013  Sup Ct, New York County
Docket Number: 400781/12  Judge: Richard F. Braun is the story of how one set of plaintiffs lost this case twice, in fact three times.  Plaintiff is pro-se, and complains that he and other plaintiffs were the defendants in a NASD action. "In 2006 the National Association of Securities Dealers issued a decision against plaintiffs and their brokerage firm.  Plaintiffs’ position is that the NASD made a mistake in charging them with violations.  Plaintiffs appealed the NASD decision with the SEC."  They hired defendants to handle the case.  After that it was all downhill.  Plaintiffs allege that defendants "allegedly represented that they would e-file the appeal with the court. Defendants represented the papers were timely filed. Upon plaintiffs’ request, defendants provided plaintiffs with a copy of the allegedly filed notice of appeal. Plaintiffs continued to make inquiry regarding the progress of the appeal, but eventually defendants refused to respond to plaintiffs’ inquiries. Plaintiffs filed a complaint against defendants with the Grievance Committee. Plaintiffs alleged that in responding to the Grievance Committee defendants falsified a letter that defendants had withdrawn as counsel from plaintiffs’ case. Plaintiffs deny receiving any letter, phone call, or email from defendants after February 14, 2008. Other alleged deceptions by defendants were that the SEC decision had never been served on defendants, that the time to appeal had not yet begun to run, and that plaintiffs could still hire another attorney to do the appeal. The Grievance Committee dismissed the plaintiffs’ complaint against defendants. From 2009 to 2011, plaintiffs attempted to appeal the NASD decision. In 201 1, plaintiffs’ action as to the NASD decision was dismissed by the judge because plaintiffs did not appeal the SEC decision, so the appellate remedy was waived. The New Jersey Bureau of Securities used the NASD decision as evidence to revoke plaintiffs’ registrations and assess monetary penal ties against plaintiffs."

"Plaintiffs argue that the legal malpractice claim occurred within the statute of limitations. However, plaintiffs fail to recognize that a legal malpractice claim accrues “when all the facts necessary to the cause of action have occurred” and the court can grant relief (McCoy v Feinman, 99 NY2d 295, 301 [2002]). Plaintiffs’ claim is based on the allegation that defendants failed to timely file an appeal, among other things. Relying on Glamm v Allen (57 NY2d 87, 95 [1982]), defendants note that a claim for malpractice related to a missed deadline accrues when the deadline is missed. The Court stated: “What is important is when the malpractice was committed, not when the client discovered it,” (id.) Plaintiffs also assert a purported fraud claim, forgery, deception, and a breach of agreement, all stemming from the alleged legal malpractice (cf. Melnitzky v Hollander, 16 AD3d 192 [ 1st Dept 20051 [where the fraud and collusion causes of action were dismissed under CPLR 32 1 1 (a) (71, due to their being grounded in the same allegations as the legal malpractice cause
of action]). CPLR 2 14 (6) provides for a three year statute of limitations for “an action to recover
damages for malpractice …, regardless of whether the underlying theory is based in contract or tort.”  Plaintiffs’ action was not commenced within the three year statute of limitations. The continuous representation doctrine does not apply here. Further, defendants representation was limited to the terms of their agreement with plaintiffs. Therefore, the CPLR 321 1 (a) (5) branch of the motion should be granted."

 

In Balkheimer v Spanton   2013 NY Slip Op 00715   Decided on February 6, 2013   Appellate Division, Second Department   we see two law firms, and their stellar legal malpractice defense attorneys fighting over who is more responsible to plaintiff.  In a situation such as this, we see the unusual (but not unprecedented) comedy of legal malpractice insurance defense attorneys pointing the finger and claiming legal malpractice was committed.
 

In any event, the lesson to be learned from this case is that after a release there are no more contribution claims, and indemnity claims depend on a separate duty owed by the indemintor to the indemnitee, not based upon duties from the indemnitor to the injured party.

"Pursuant to General Obligations Law § 15-108(b), "[a] release given in good faith by the injured person to one tortfeasor as provided in [General Obligations Law § 15-108(a)] relieves him [or her] from liability to any other person for contribution as provided in article fourteen of the civil practice law and rules." Here, the plaintiffs executed a general release in favor of the third-party defendants. There is no indication in the record that the release was not executed in good faith. Therefore, pursuant to General Obligations Law § 15-108(b), the third-party defendants are relieved from liability to the third-party plaintiffs for contribution (see Ziviello v O’Boyle, 90 AD3d 916, 917; Kagan v Jacobs, 260 AD2d 442). Accordingly, the Supreme Court should have granted that branch of the motion of the third-party defendants which was pursuant to CPLR 3211(a)(5) to dismiss the contribution cause of action in the third-party complaint as barred by the release.

In considering a motion to dismiss for failure to state a cause of action pursuant to CPLR 3211(a)(7), the court must "accept the facts as alleged in the [pleading] 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 83, 87-88). "[T]he key element of a common-law cause of action for indemnification is not a duty running from the indemnitor to the injured party, but rather is a separate duty owed the indemnitee by the [*2]indemnitor’" (Raquet v Braun, 90 NY2d 177, 183, quoting Mas v Two Bridges Assocs., 75 NY2d 680, 690; see Lovino, Inc. v Lavallee Law Offs., 96 AD3d 909, 909-910). "

 

The New York Law Journal reports a Pryor Cashman legal malpractice and billing case today.  It’s a very big fee, and Judge Schweitzer decides for the law firm today in Pryor Cashman LLP v. U.S. Coal Corporation, Supreme Court, New York County, Index No. 651908/2011.

"Plaintiff Pryor Cashman LLP moves, pursuant to CPLR 32 12, for summary judgment against defendant U.S. Coal Corporation in the principal amount of$2.455.478.86, with interest, dismissing the counterclaims and affirmative defenses, and awarding it costs and expenses incurred in this action.

US Coal cross-moves for summary judgment on its counterclaims for breach of fiduciary duty; ordering Pryor Cashman to forfeit any fees that US Coal would otherwise owe, and for restitution and disgorgement of all amounts paid for any work done during the relevant time period ; dismissing Pryor Cashman’s claims in their entirety; and awarding US Coal the expenses incurred in defending this action, and in prosecuting its counterclaims, including pre- and post-judgment interest, costs, and attorneys’ fees.
 

Pryor Cashman argues that there are no issues of fact relating to its account stated cause of action in that it is has demonstrated that it sent 117 invoices to US Coal using regular mailing procedures, none of which were ever returned. US Coal never objected to any of the invoices,
and even made partial payment. As for the breach of contract cause of action, it asserts that US
Coal cannot dispute the existence of the contract, and that both parties performed under the terms
of the contract. It also contends that the investments obtained were inconsequential in terms of
the amount of equity of the company that was outstanding. Moreover, the shares given to the law
firm were given in appreciation of its agreement to defer payment of the attorney’s fees owed.

US Coal argues that there are substantial issues of fact concerning the reasonableness and accuracy of the invoices, that the claimed bills do not match US Coal’s records, that the mere retention of invoices from a lawyer is not sufficient to prevail on a claim of account stated, and
that Pryor Cashman’s violation of applicable ethical standards provides a complete defense. It
disputes that it ever entered into a contract with Pryor Cashman, and argues that New York
regulations require a signed contract or a final written retainer letter. Moreover, it contends that,
even if there were a contract, there are issues of fact and credibility regarding the law firm’s
performance of its professional obligations.

For the reasons discussed below, the motion is granted as to both causes of action, and the
counterclaims and affirmative defenses are dismissed. Pryor Cashman establish shed a prima facie entitlement to judgment as a matter of law on the cause of action for an account stated, by demonstrating that it sent detailed invoices to US Coal on a regular basis in the course of its business (Geron v DeSantis, 89 AD3d 603, 604 [1st Dept 2011]), and documentary evidence shows that US Coal received and retained the invoices without objection (Miller v Nadler, 60 AD3d 499 [I Dept 2009]). As set forth in his affidavit, Hellige provided an engagement letter, dated July 17,2006, to Karl Douglas, the then managing director of US Coal. Although US Coal states that it has not found a formal retainer letter executed by Pryor Cashman or by US Coal, it concedes that it has a copy of the engagement letter. The engagement letter set forth the terms of the legal work that Pryor Cashman was to perform for US Coal, including: ( I) the general scope of services (corporate and securities.  For the reasons discussed below, the motion is granted as to both causes of action, and the counterclaims and affirmative defenses are dismissed.

Pryor Cashman established a prima facie entitlement to judgment as a matter of law on
the cause of action for an account stated, by demonstrating that it sent detailed invoices to
US Coal on a regular basis in the course of its business (Geron v DeSantis, 89 AD3d 603, 604
[1st Dept 2011]), and documentary evidence shows that US Coal received and retained the
invoices without objection (Miller v Nadler, 60 AD3d 499 [I Dept 2009]).

As set forth in his affidavit, Hellige provided an engagement letter, dated July 17,2006,
to Karl Douglas, the then managing director of US Coal. Although US Coal states that it has not
found a formal retainer letter executed by Pryor Cashman or by US Coal, it concedes that it has a
copy of the engagement letter. The engagement letter set forth the terms of the legal work that Pryor Cashman was to perform for US Coal, including: ( I) the general scope of services (corporate and securities matters); (2) an explanation of the basis of fees to be charged, and a range of billing rates for the attorneys, law clerks, and paralegals; (3) an explanation of the type of expenses likely to be incurred, and which a~e to be reimbursed by US Coal; (4) an explanation of billing practices,
including its practice of sending a monthly invoice setting forth the fees and expenses incurred
during the previous month, and Pryor Cashman’s right to impose interest on balances outstanding
for more than 30 days; (5) an explanation that US Coal is free to terminate the attorney-client
relationship at any time, and that Pryor Cashman will withdraw in a manner that complies with
applicable law; and (6) a discussion about arbitration as the means to resolve disputes regarding
fees charged and services performed.

In challenging the substance of the invoices, US Coal submitted an affidavit it of Michael Brychel, a senior legal auditor in the firm of Stuart, Maue, Mitchell & James, Ltd., sworn to July 9, 20 12. He states that US Coal retained him to review the unpaid legal bills .that are the subject of this action. He concludes that the bills "fall below the prevailing standards of the industry, are consistent with likelihood that Pryor Cashman has overbilled US Coal, and demonstrate that there are substantial issues of fact as to whether those bills are reasonable on their face" (Brychel Affidavit, 20).

The total dollar value of the bills that Brychel reviewed was $4,670,345.23, including
$4,551,826.32 attributed to fees, and $136,547.13, to expenses, with $ 18,028.22 as write-offs
against fees or expenses. In reviewing Pryor Cashman’s bills, he noted that it appeared to charge
US Coal in quarter-hour increments, which does not represent the industry standard (tenths of an
hour) that existed during the time covered by the bill s. He opines that large numbers of instances
of 14-hour-plus days represent questionable billing practices, and in the invoices, he noted
$92,970.00 billed in such a manner which constitute "a significant amount."
According to Brychel, another typical hallmark of questionable billing practices is the
presence of large numbers of entries that repeat virtually word for word over multiple days. In
his review, he identified an attorney who regularly committed such billing entries, and
$64,840.67 of the time billed for this attorney appeared to be only partial entries that were too
vague to enable one to accurately discern the task performed. Another $146,466.21 was
attributed to conferences in which no other party is noted, and $380,190.86 where no subject
matter is stated. Brychel noted that $85,437.83 of expenses were "unusually vague," and
$11 ,92 1.96 of those expenses appear to be billing for overhead, not for actual expenses allocatable to specific amounts expended for the client.
 

Regardless of the merits of these objections, US Coal has not met its burden of showing
that they objected to the invoices within a reasonable time

You want to sue your attorney, and the security guard downstairs won’t let the process server up.  The process server goes there several times, and fails to get upstairs.  What is one to do?

Miller v Friedman  2013 NY Slip Op 30282(U)  January 29, 2013  Supreme Court, New York County Docket Number: 400833/12  Judge: Joan A. Madden gives one answer.  You should go to the judge, via motion, early on, and ask for expedient service or some other relief.

"In the affidavit of service, Tracy Harris states that on April 16, 17 and 18, 2012, she attempted to deliver the summons and complaint to defendants at their place of business at 217 Broadway, Suite 401, New York, New York, and on each day she spoke to the security officer at the building, Willie Bernard, who told her “defendants were not available,” and he “would not allow me access upstairs.” Ms. Harris further states that on April 18, 2011 ,“I served the parties listed below by mailing a true copy of the attached papers, enclosed and properly sealed in a prepaid envelope, via signature confirmation, next day, priority mail, which I then deposited in a official depository under the exclusive care and custody of the United States Postal Services within the State of New York addressed” to defendants at the 217 Broadway address.

Based on the affidavit of service, it is undisputed that defendants were served by mail alone, which is not sufficient to effectuate service on the individual defendant under CPLR 308 or the defendant law firm under CPLR 3 IO. The CPLR does not permit service by mail alone. Rather, mailing is just one component of personal service, which is required as a follow-up after the summons and complaint are either delivered to a person of suitable age and discretion at defendants’ actual place of business, or affixed to the door of defendants’ actual place of business. 

In opposing the motion, plaintiff requests that the court “use its discretion” pursuant to CPLR 308(5) to “permit service by mail or some other mode crafted by this Court, because there is no other mode of service available.” Plaintiff also requests that the court use its discretion to find that he “need not comply with the strict provisions of the CPLR,” due to his “physical and financial hardship” and the “impracticality of other modes of service.”

Under CPLR 308(5), the court is authorized to permit expedient service where a plaintiff demonstrates that it is “impracticable” to serve a defendant under existing statutory methods.
With respect to service on a natural person, a plaintiff need only establish that service cannot be
made under CPLR 308(1), (2) and (4).Dobkin v. Chapman, 21 NY2d 490,500 (1968)  Significantly, a showing of impracticability does not require plaintiff to establish actual prior attempts by each and every statutory method of service, or require proof of due diligence. Contimortgage Corp v. Isler, 48 AD3d 732,734 (2nd Dept 2008); Franklin v. Winard, 189 AD2d 717 (1” Dept 1993); Saulo v. Noumi, 119 AD2d 657 (2nd Dept 1986). The court is not persuaded that plaintiff has sufficiently shown that service is impracticable within the meaning of CPLR 308(5). Plaintiff states in his affidavit that defendant law firm is located in a office building “manned by a security guard that does not allow citizens access to the building if they do not have an appointment” and “if there is no response from the company after the security guard attempts to contact the company via telephone.”

Even though plaintiff has not established grounds for expedient service pursuant to CPLR 308(5), the court finds that plaintiff has made an adequate showing of good cause pursuant to CPLR 306-b for an extension of time to serve the summons and complaint on defendants. Henneberry v. Borstein, 91 AD3d 493 (1st Dept 2012). Plaintiff shall have 45 days from the date of this decision and order to properly effect service on defendants, and in the event he is unable to do so, the court will reconsider his request for expedient service."

Defendant attorney represented buyer in a real estate transaction, in which she obtained only a part of what she expected to get.  Who was at fault, the attorney or the title company?  The Court decided that the title company was not responsible and the attorney went to trial.  After trial, in which the buyer obtained a verdict, the attorney once again tried to sue the title company.  Result?  Dismissal upon a finding of collateral estoppel.

In Herrick v Statewide Abstract Corp.  2013 NY Slip Op 50152(U)   Decided on February 5, 2013
Supreme Court, Westchester County   Connolly, J.  we see that "Herrick, an attorney, represented Luis and Maria Rojas, who were the plaintiffs in the prior action, in all aspects of the purchase transaction of a parcel of property located at 16 Montana Place, White Plains, New York, from negotiation of the contract of sale through the closing of title. Along with the contract of sale, the purchasers were provided with a survey depicting the property to be purchased. The contract of sale included a legal description of the property attached as Schedule "A," which described the property as a "parcel of land, situate, lying and being in the Town of Greenburgh, County of Westchester, State of New York, known and designated as part of Lot No. 8 as shown on the certain Map . . . ."

In connection with the purchase, Herrick, on behalf of Rojas, ordered a title search and report of the subject property through Statewide and requested that Statewide certify title to Rojas’ title insurer, Stewart Title Insurance Company. Herrick provided Statewide with the Schedule "A" legal description of the property and a survey that described the property as a "portion of Lot No.8." Statewide used these documents to conduct its title examination and prepare its title report of the property. This same legal description was included in the title insurance policy issued by Stewart Title, as well as a bargain and sale deed delivered to Rojas from the sellers at the closing held on June 6, 2005. Statewide’s title report stated in several places, including in the Schedule B Title Exceptions and in copies of two deeds by which the sellers acquired the property in 2003, that the subject property to be conveyed was only a portion of Lot No. 8. The parcel conveyed to Rojas at closing consisted of approximately .45 acres of land improved by a residential home. The remaining parcel, which the sellers retained, consisted of approximately .34 acres of unimproved land that had been conveyed to the sellers by quitclaim deed in 2003.

Rojas resided at the property until 2007, when they decided to relocate for employment reasons. As part of the relocation process, Rojas’ employer offered the services of a relocation [*3]company to purchase the property. The relocation company ordered a title search and report, wherein it was revealed that Rojas did not own the entirety of the parcel of land located at 16 Montana Place, in that only a "portion of Lot No. 8," referred to as the house parcel, was conveyed to Rojas, with the sellers retaining title to the remaining parcel containing unimproved land. Upon discovering that the property consisted of only a portion of Lot No. 8, the relocation company would not accept title to the property.

Rojas thereafter commenced a lawsuit against various defendants, including Statewide, Herrick, Stewart Title, the sellers, the sellers’ attorney, and the real estate brokers and agents involved in the 2005 Rojas purchase transaction. The action was entitled, Luis X. Rojas and Maria Rojas v. Andrew Paine, et. al., Westchester County Supreme Court Index Number 27830/07. The Rojas complaint alleged that, despite the fact that the sellers owned two parcels comprising Lot No. 8, the contract of sale and deed purported to sell only a portion of the subject property, the house parcel. The complaint alleged the defendants failed to disclose that the subject property was illegally subdivided by deed into the house parcel and remaining parcel without the permission, consent, or authorization of the Town of Greenburgh, and that due to materially false representations about the true nature and condition of the title issues involving the subject property, Rojas only received the house parcel at the time of closing. Rojas alleged that the illegal subdivision of the parcel created an objection to title, rendering title unmarketable. As is relevant herein, Rojas asserted a cause of action against Herrick for legal malpractice, and asserted three causes of action against Statewide, sounding in breach of contract, negligence, and breach of insurance agreement.

Rojas claimed that Statewide breached its contract with them by failing to properly perform, investigate, and report upon title issues. Rojas also claimed that Statewide negligently, recklessly, and carelessly failed to properly perform, investigate, and report upon title issues and failed to raise an exception to title relative to the illegal subdivision and encroachments. In its answer to the Rojas complaint, Herrick asserted a cross-claim against Statewide for contribution and indemnification, alleging that if the plaintiffs were damaged, such damages were caused by the negligent, intentional, or reckless conduct, acts, or omissions of Statewide and therefore, Herrick would be entitled to judgment over against Statewide for any judgment plaintiff may recover against Herrick.

Following motions to dismiss by the various defendants, the only remaining defendant at the time of trial was Herrick. By decision and order entered on June 29, 2010, the Hon. William J. Giacomo, J.S.C., granted Statewide summary judgment dismissing Rojas’ claims for negligence and breach of insurance contract. The court initially denied Statewide summary judgment on the breach of contract cause of action, stating "[i]n view of the fact that the tax lot issue was subsequently discovered . . . there is clearly a question of fact regarding whether Statewide breached its contract with plaintiffs to perform a proper title search which included a notation that the portion of Lot 8 being purchased by plaintiffs was part of a larger lot for which there was no filed subdivision in the Town of Greenburgh." It further held that "[u]nder the contract for searching titles the defendant may be liable for any damages which its negligence [*4]may have imposed upon the plaintiff," and that "liability can arise in the event the search is performed in a negligent manner."

Thereafter, Statewide moved to reargue Justice Giacomo’s denial of summary judgment on Rojas’ breach of contract claim. The motion was opposed by Rojas, who argued Statewide should be held liable for failing to properly conduct a title search and report title defects. Defendant Herrick also opposed Statewide’s motion and moved for summary judgment against the plaintiffs. In Paul Herrick’s affidavit dated December 22, 2010, he argued:

"The title report prepared by Statewide . . . was defective in several significant respects. First, the title report failed to disclose that the property plaintiffs had contracted to purchase did not conform with the legal description and was only a portion of the tax lot owned by sellers, Andrew and Karen Paine ("the Paines"). Second, the title report included an outdated tax map, which did not include current including their option to terminate the transaction upon receipt of the title report."

By decision and order dated September 30, 2011, the court granted reargument to Statewide, and upon reargument, dismissed Rojas’ breach of contract claim against Statewide.Herrick now commences the instant action against Statewide, seeking contribution and indemnification. The complaint alleges that Statewide negligently performed a search of the public records, and due to Statewide’s faulty title search, Herrick was not informed that the property upon which the house parcel was located constituted only a portion of the tax lot. Herrick alleges that had it been properly informed by Statewide that the property was located on only a portion of the tax map, Herrick would have advised Rojas to exercise their contractual rights to rescind the contract and refuse to purchase the property.

Statewide moves to dismiss the complaint pursuant to CPLR § 3211 (a) (1) and (5) on grounds that a defense is based upon documentary evidence and the cause of action may not be maintained because of collateral estoppel and res judicata. Herrick opposes the motion, arguing that it relied upon Statewide’s faulty title report in counseling Rojas to purchase the property, which resulted in the damages sustained by Rojas. Herrick claims it was forced to concede liability and accept responsibility for the acts of its agent, Statewide, in preparing a defective title report, and that the issue of Statewide’s liability to Herrick was never determined in the prior action.

"The party seeking the benefit of the doctrine of collateral estoppel must establish that the identical issue was necessarily decided in the prior action and is determinative in the present action" Mahler v Campagna, 60 AD3d 1009, 1011 [2d Dept 2009]). "Once the party invoking the doctrine discharges his or her burden in that regard, the party to be estopped bears the burden of demonstrating the absence of a full and fair opportunity to contest the prior determination" (id.).

Here, Statewide has demonstrated that the identical issue was decided in the prior action and is determinative of the present action, while Herrick has failed to sustain its burden to establish that it lacked a full and fair opportunity to litigate the issue as a party defendant in the prior action. Herrick’s recourse, to which it is availing itself, is to appeal from the orders and judgment in the prior action— not to commence a new action with the hope of relitigating the issue in its favor. Because the identical issue was already litigated and decided, and Herrick had a full and fair opportunity to litigate the issue in the prior action, the action against Statewide is dismissed on the ground of collateral estoppel. "

 

This case appears to be a fee dispute with a healthy counterclaim.  We glean that defendants waited until (and perhaps only because) they were sued for legal fees.  They responded with a legal malpractice counterclaim.  In Debevoise & Plimpton LLP v Candlewood Timber Group LLC
2013 NY Slip Op 00408   Decided on January 29, 2013   Appellate Division, First Department defendants are permitted a legal malpractice counterclaim only as a monetary offset to plaintiff’s claims.  They are precluded from a positive award above the claims of plaintiff because of the statute of limitations.

Plaintiffs were permitted only one motion for summary judgment, which they had used for a statute of limitations argument. 

"The court properly found that defendants’ legal malpractice counterclaim was time-barred to the extent defendants seek monetary damages (see CPLR 214[6]). The most recent allegation of negligence occurred in May 2006 — more than three years before this action was commenced in November 2009 — and defendants failed to show that the continuous representation doctrine applies. "There were no clear indicia of an ongoing, continuous, developing and dependent relationship between the client and the attorney" (Matter of Merker, 18 AD3d 332, 332-333 [1st Dept 2005] [internal quotation marks omitted]), nor was there "a mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim" (McCoy v Feinman, 99 NY2d 295, 306 [2002]). Defendants did not submit affidavits showing "that facts essential to justify opposition may exist but cannot then be stated" (CPLR 3212[f]). As both sides agree, defendants’ malpractice counterclaim is not time-barred insofar as defendants seek to set off their malpractice damages against any recovery plaintiff might obtain (see CPLR 203[d]).

Plaintiff is correct that its second summary judgment motion was not duplicative of its first: Its first motion dealt only with the statute of limitations, whereas its second dealt with the merits of defendants’ malpractice counterclaim. However, "[a]s a general rule, parties will not be permitted to make successive fragmentary attacks upon a cause of action but must assert all available grounds when moving for summary judgment" (NYP Holdings, Inc. v McClier Corp., 83 AD3d 426, 427 [1st Dept 2011] [internal quotation marks and brackets omitted]). Plaintiff has not demonstrated that any of the exceptions to this rule apply (see e.g. Jones v 636 Holding Corp., 73 AD3d 409 [1st Dept 2010]; Varsity Tr. v Board of Educ. of City of N.Y., 300 AD2d 38, 39 [1st Dept 2002]). "

 

Attorney is hired to represent funeral home for a disinterment.  In the retainer agreement, it is specifically set forth that the attorney will also be representing the person requesting the disinterment.  A $10,000 retainer is given, and the work begun.  It ends successfully.  When the bill is sent, the funeral home refuses to pay.  We presume that there was some problem between the person and the funeral home.  In any event attorney does not get paid.  McKeon v SCI New Jersey Funeral Serv., Inc.  2013 NY Slip Op 30218(U)  January 29, 2013  Sup Ct, New York County
Docket Number: 112504/11  Judge: Donna M. Mills turns into an account stated case with defendant interposing 17 defenses.  We reproduce Judge Mills’ decision, which works through the affirmative defenses.

"Turning to the other relief sought, the court shall considered the merit of the seventeen affirmative defenses which are as follows: ( I ) failure to state a cause of action; (2) unclean hands; (3) waiver; (4) statute of limitations and/or laches; (5) estoppel; (6) breach of contract; (7) violation of the notice provisions; (8) violation of the statute of frauds; (9) churning; (10) unconscionability; (11) violation of the Code of Professional Responsibility; (12) legal malpractice; (13) failure to name a necessary party; (14) third-party liability; (15) failure to mitigate; (1 6) attorneys’s lees unrecoverable; and (1 7) reservation of right to assert additional defenses.

Plaintiff seeks dismissal on the grounds that failure to state a cause of action, lack of
specificity, and/or documentary evidence. In response, defendant argues that the motion to
dismiss is premature, where no discovery has yet been conducted. Specifically, defendant asserts
that the first affirmative defense is not subject to dismissal. Plaintiff acknowledges that said
defense is defined as meaningless surplusage by the Appellate Division, First Department. See
Riland v Todman & Co., 56 AD2d 350, 352 ( 1st Dept, I977), but states that it can be dismissed if
all of the other defenses arc subject to dismissal;See. See Raine v. Allied Artists Prods. v Artists Prods., Inc., 63 AD2d 914 (1st Dept, 1978)

The court shall examine the other defenses.The second affirmative defense seeks relief under the unclean hands doctrine. The partyalleging unclean hands must establish that the party charged committed immoral or unconscionable conduct directly related to the subject matter. See Citibank, N.A. v American Banana Co, Inc.., 50 AD3d 593, 594 (1st Dept 2008). This defense is connected to plaintiff‘sequitable claims in the complaint. The court finds that defendant has not made out a defense that plaintiff’s conduct is so immoral and depraved as to warrant a defense of unclean hands. The second affirmative defense is dismissed.

The third affirmative defense, waiver, alleges that plaintiff had intentionally waived a legal right she had. Defendant does not specify in the answer what legal right had been relinquished by her. The court shall dismiss this defense as lacking in specificity, thus, failing to state a proper defense‘ensue.

The fourth affirmative defense, statute of limitations and laches, alleges that this complaint is untimely. ‘J’he statute of limitations for breach of contract claims is six years from the breach. CPLR 2 13 (2). The retainer agreement was executed on September 30,2009, and this action was commenced in 2011, so there is no statute violation. Defendant’s laches defense is deficient where it fails to alleges some evidence of prejudice in addition to delay. See Steele v Motor Vehicle Acc. Indemnification. Gorp., 39 AD3cl 78, 82 (1st Dept 2007). The fourth affirmative defense is dismissed.

The fifth affirmative defense is estoppel. The doctrine of estoppel would preclude plaintiff from asserting a legal right alter leading defendant to reasonably believe that she did not intend to assert-t this right. ’I’his defense is insufficient‘.. There is no indication that plaintiff  misled defendant into relying on some inconsistent conduct on her part, resulting in prejudice. See BWA Corp. v Alltrans Express U.S.A., 112 AD2d 850, 853 (1st Dept 1985). The allegation that defendant was somehow misled into believing that it would not pay any amount beyond the initial $10,000 is belied by the explicit terms of the retainer agreement. The fifth affirmative defense is dismissed.

The sixth affirmative defense alleges that plaintiff breached the retainer agreement by failing to provide regular communications, and by billing excessive charges. The seventh affirmative defense alleges that plaintiff failed to provide regular notice to defendant while providing legal services. Since the account stated claim has been granted, the allegation of excessive fees is moot as defendant’s demonstrated failure to express timely objection to the fees constitutes acquiescence to the reasonableness of‘the fees. ‘The failure to provide notice is also moot. These defenses are dismissed.

The eighth affirmative defense, violation of the statute of frauds, is not relevant, since the suit involves a written agreement. The eighth affirm alive defense is dismissed. ‘The ninth affirmative defense apparently alleges that plaintiff should be barred from recovering fees because she worked beyond the terms provided by the retainer agreement and overcharged defendant for work outside of that stipulated by said agreement. This defense lacks specificity as to what constituted work beyond the terms of the retainer agreement. The ninth affirmative defense is dismissed.

The tenth affirm alive defense alleges that the retainer agreement is unconscionable and unduly burdensome to defendant. This defense is not specific, and no evidence is submitted to show that this agreement is unconscionable. Moreover, plaintiff has provided evidence that prior to the execution of this agreement, the parties had extensive communications as to specific
provisions related to the payment of fees. Defendant has not provided any proof that he objected
or criticized the provisions prior to execution, or at any other time. The tenth affirmative defense
is dismissed.

The eleventh affirmative defense alleges that plaintiff’s conduct violated the Code of Professional Responsibility. Here, there is no reference to any specific code provision. Also, the claim that plaintiff charged excessive fees unreasonable fees beyond the initial retainer fee is belied by the documentary evidence submitted by plaintiff. ’The eleventh affirmative defense is dismissed.

The twelfth affirmative defense is similar to the ninth one, alleging plaintiffs conduct as
going beyond the scope of her employment, Although it is based on tort, rather than contract. The
court shall dismiss this defense as lacking in specificity.

The thirteenth affirmative defense alleges that the failure to name a necessary party to this action precludes plaintiffs claims. This party is supposedly Philip, the deceased’s son. The court does not find him to be a necessary party, as this retainer agreement was only executed by plaintiff and defendant€defendant, Philip Philip was not intended to be a third-party beneficiary. This affirmative defense is dismissed.

The fourteenth affirmative defense alleges that plaintiffs claims are barred because a third-party is liable for money owed. Defendant has not specified the third-party. Plaintiff has provided documentary evidence, a copy or defendant’s’s agreement with Philip, which  provides
that defendant agreed to be responsible for the payment of legal fees concerning the disinterment
and other matters. The fourteenth affirmative defense is dismissed.

The fifteenth affirmative defense alleges h a t plaintiff failed to mitigate her damages. There is no specificity to this defense and it is dismissed.

The sixteenth affirmative defense alleges that plaintiff is not entitled to attorney’s fees. ‘This defense is lacking in specificity. Defendant’s’ s previous explanations as to why plaintiff is not entitled to any fees (breach of contract, malpractice) have been rejected by this court. Thus, this defense is dismissed.

The seventeenth affirmative defense alleges defendant’s entitlement to allege additional
affirmative defenses during the course of this action. This is not a proper affirmative defense and
is dismissed.

The court will dismiss all but the first affirmative defense, as it may relate to the remaining causes of action. The other defenses are either deficient in merit or are disproved by documentary evidence.

Millennium Imports LLC marketed a huge success in the vodka world, "Belvedere."  Millennium was itself a golden child of the Louis Vuitton, Moet and Hennessy (LVMH) companies, so when a California winery that already had a wine called Belvedere claimed trade infringement, a small licensing fee of $ 30,000 per year was nothing to worry about.

Later, the winery wrote that it was intending to be associated with a gin to be called Belvedere.  Millennium and LVMH went into high gear, and had multiple law firms look at the situation.  Their solution was to write a strong letter and threaten. The Winery claimed breach of contract and eventually won $ 38 Million.  Who’s to blame, and how will the resulting legal malpractice litigation shake out?

"It is well settled that an attorney sued for malpractice may assert a third party claim against another lawyer who advised the plaintiff on the same matter. The leading case on this point is Schauer v Joyce (54 NY2d 1 [1981]). In Schauer, an attorney was sued by his client for malpractice, due to his failure to obtain alimony for his client. He, in turn, asserted a third-party claim for contribution under CPLR 1401 against the lawyer who succeeded him in representing the plaintiff, claiming that the successor lawyer’s negligence in failing to properly reapply for alimony contributed to the loss. The Appellate Division upheld the dismissal of the third-party claim, reasoning that the third-party defendant could not be liable for the injury caused to the plaintiff by the third-party plaintiff; in the Court’s view, "[t]he extent to which plaintiff either personally or through her agent [third-party defendant] failed to mitigate damages is a matter of defense" (79 AD2d 826, 826 [3d Dept 1980]). But the Court of Appeals reinstated the contribution claim, explaining that:

"CPLR 1401, which codified this court’s decision in Dole v Dow Chem. Co. (30 NY2d 143), provides that two or more persons who are subject to [*4]liability for damages for the same personal injury, injury to property or wrongful death, may claim contribution among them whether or not an action has been brought or a judgment has been rendered against the person from whom contribution is sought.’ The section applies not only to joint tortfeasors, but also to concurrent, successive, independent, alternative, and even intentional tortfeasors’" (Schauer, 54 NY2d at 5, quoting Siegel, New York Practice, § 172, p 213; and citing McLaughlin, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR 1401, pp 362-363).

Not only do we find this reasoning applicable to the third-party claim against the law firm that served directly as plaintiff’s counsel, but we also see no basis to find this reasoning inapplicable to the law firms whose allegedly negligent advice was supplied to plaintiff via plaintiff’s parent company. It is well settled that attorneys may be liable for their negligence both to those with whom they have actual privity of contract and to those with whom the relationship is "so close as to approach that of privity" (Prudential Ins. Co. of Am. v Dewey, Ballantine, Bushby, Palmer & Wood, 80 NY2d 377, 382 [1992]). Since here the allegations support a finding that the advice of the two firms acting as counsel to plaintiff’s parent company was given "for the very purpose of inducing action" on plaintiff’s part, the third-party claim against those firms for contribution is actionable (id. at 383).

Even if we agreed that the affirmative defense of comparative negligence precludes a claim for contribution against an agent of plaintiff’s, that would only warrant dismissal of the third-party claim against the Berry firm, as counsel to (and agent for) plaintiff. The claim for contribution against the other two third-party defendants could not be viewed as duplicative, since the affirmative defenses did not specifically name them as plaintiff’s agents whose alleged negligence defendants sought to impute to plaintiff for comparative negligence purposes. Consequently, the third-party claims would be viable against third-party defendants the Barack firm and the Fross firm in any event.

With respect to the application to dismiss the third-party action without prejudice under CPLR 1010, there is no indication that the third-party complaint will delay the main action. On the contrary, there clearly are efficiencies to be gained from having the claims proceed together.

Accordingly, the judgments of the Supreme Court, New York County (Milton A. Tingling, J.), entered November 15, 2011, July 6, 2011 and July 18, 2011, dismissing the third-party complaint as against third-party defendants James H. Berry, Jr. and Berry & Perkins, Barack, Ferrazzano, Kirschbaum & Nagelberg LLP and Fross, Zelnick, Lehman & Zissu, P.C., respectively, should be reversed, on the law, without costs, the judgments vacated, and the third-party complaint reinstated. Appeals from the orders, same court and Justice, entered March 30, [*6]2011, July 6, 2011 and July 18, 2011, which granted third-party defendants’ motions to dismiss the third-party complaint, should be dismissed, without costs, as subsumed in the appeals from the judgments."
 

Often, insurance companies seem opaque and distant.  Their decision making is hidden, individuals seem to have significant power over settlement decisions, and the rules that permit denials of coverage are Byzantine.  Here is a rare look into how the defense bar and the insurance companies interact. Insurance Corp. of N.Y. v Smith, Mazure, Director, Wilkens, Young & Yagerman, P.C.   2013 NY Slip Op 30115(U)   January 23, 2013   Supreme Court, NY County
Docket Number: 102485/08  Judge: Saliann Scarpulla.

"In this legal malpractice action, plaintiff The Insurance Corporation of New York ("Inscorp")alleges that, while representing Inscorp, Joel Simon, Esq. ("Simon"), a member of Smith Mazure, negligently rendered legal advice regarding insurance coverage during telephone conversations in late 2004 and early 2005. Inscorp alleges that Simon negligently counseled Michael Weiss (“Weiss”), a claims adjuster employed by Inscorp’s third-party administrator, Ward North America (“Ward”), that Inscorp was contractually obligated to provide a defense and indemnification to West Perry, LLC (“West Perry”) and G.B, Construction, LLC (“G,B. Construction”) in an underlying Labor Law action.

Specifically, Inscorp alleges that Simon improperly advised Weiss that West Perry, the construction site owner, was an additional insured under an Inscorp general liability policy issued to G.B. Construction, a subcontractor at the site, and that the Inscorp late disclaimers of coverage issued by Ward were improper and untimely, and therefore, invalid. Inscorp alleges that the disclaimers were enforceable on the grounds that West Perry was not an additional insured under the Inscorp policy, and that neither G.B. Construction nor West Perry had satisfied the policy’s notice of claim requirements.

Inscorp also alleges that Simon negligently failed to disclose to Weiss that United National Insurance Group (‘UNG’’) had retained Smith Mazure to secure additional coverage for West Perry under the Inscorp policy, following Inscorp’s failure to respond to UNG’s October 15,2004 tender of West Perry’s defense and indemnity. Inscorp further alleges that UNG’s retention of Smith Mazure created a conflict of interest, inasmuch as Smith Mazure had represented UNG and its insureds over a period of years.

Inscorp alleges that, based on Smith Mazure‘s negligent legal advice, it rescinded ts valid disclaimers to West Perry and G.B. Construction, and expended approximately $73,000 in legal fees in defending G.B. Construction and West Perry, and $490,000 in settling the Soto action on behalf of both companies. In the answer, Smith Mazure denies all allegations of wrongdoing. In this motion, Smith Mazure alleges that, at the time that the alleged misconduct occurred, it had not
been retained by Inscorp or Ward to render an insurance coverage legal opinion for either West Perry or G.B. Construction, and had clearly advised Weiss that it was acting on behalf of UNG when Simon contacted Weiss in 2004 and 2005. Smith Mazure explains that, in November or December 2004, Simon had received a request from Cheryl Mawby (“Mawby”), a UNG senior claims examiner, to commence a declaratory judgment action to compel Inscorp to provide a defense to UNG‘s insured, West Perry, in the Soto action, and Simon had contacted Inscorp to verbally request coverage on behalf of West Perry.

An attorney’s simultaneous representation of two adverse parties in a matter, or the failure to disclose such a conflict, may form the basis of a valid claim for legal malpractice. See Hearst v. Hearst, 50 A.D.3d 959, 963 (2d Dept 2008). In determining whether such an attorney- client relationship exists, the court may consider the following factors, among others: whether the parties entered into a fee arrangement; whether a written retainer agreement or other contract exists; whether there was an informal relationship in which the attorney performed legal services gratuitously; whether the attorney actually represented the purported client in an aspect of the matter; whether the attorney excluded the purported client from some aspect of the litigation to protect another client’s interests; and whether the purported client reasonably believed that the
attorney represented him or her. Catizone v. WON 71 F. Supp. 2d 365, 368 (S.D.N.Y.
1999) (applying New York law).

Here, the record consists primarily of deposition testimony and affidavits by Weiss and Simon, which establish triable issues of fact regarding whether an attorney-client relationship regarding coverage issues existed between Inscorp and Smith Mazure at the time Weiss and Simon spoke in 2004 and 2005, See Terio v. Spodek, 63 A.D.3d 719,721. (2d Dept 2009).

Contrary to Smith Mazure’s contention, the lack of a written retainer agreement for a coverage opinion does not conclusively demonstrate that no attorney-client relationship existed, particularly where, as here, such a relationship previously existed between the parties. See Terio, 63 A.D.3d at 721; Moran, 32 A.D.3d at 91 1. Weiss testified that Inscorp and Ward would not disclaim coverage without a legal opinion, and that Ward’s coverage counsel often rendered opinions without retainer agreements and would, on occasion, provide verbal and gratuitous coverage opinions. Similarly, Smith Mazure’s failure to bill Inscorp for a coverage opinion is not dispositive, given that Smith Mazure also failed to bill UNG for Simon’s conversation with Weiss on December 30, 2004, although Smith Mazure contends that it was representing UNG on that date. It is well settled that an attorney owes his continuous clients a fiduciary duty, even in matters for which the attorney is not specifically retained, and that the breach of this duty can also constitute attorney malpractice. See Cavaliere v. Plaza Apts., Inc., 84 A.D.3d 712,713-714 (2d Dept 201 1). The parties here have raised
triable issues regarding whether Smith Mazure simultaneously represented Inscorp and
UNG, expressly disclosed its representation of UNG, and if so, whether Smith Mazure
obtained Inscorp’s consent to the simultaneous representation. Tabnsr v. Drake, 9 A.D.3d
606, 610 (3d Dept 2004). Contrary to Smith Mazure’s contention that Inscorp did not retain Smith Mazure to represent West Perry until after the alleged legal advice was given, Weiss’ statement that
he would consider extending coverage and accepting the tender, if UNG waived its right to recover the attorneys’ fees already expended, is not dispositive. It is not clear from the record whether Weiss believed that he was negotiating with counsel for an adversary, or instructing Inscorp’s counsel regarding negotiations with the adversary. "