1650 Broadway Assoc., Inc. v Sturm 2024 NY Slip Op 01864 Decided on April 04, 2024
Appellate Division, First Department Renwick, P.J. is the story of a Diner, a Family and Fraud.

“Plaintiff 1650 Broadway Associates, Inc. is the owner of the iconic Stardust Diner, a family business originally owned by Irving Sturm and plaintiff Ellen Sturm, and then in part by their son, defendant Kenneth Sturm. At all relevant times, Ellen, along with the two trust plaintiffs, together owned 89% of the Diner, and Kenneth owned 11%. After Irving’s death in 2010, Kenneth assumed day-to-day managerial responsibility for the Diner. Ellen was vice-president of the Diner, while Kenneth served as secretary and treasurer.

Plaintiffs allege that when Ellen stepped back from active operations of the Diner, Kenneth began looting the Diner. In particular, he gave himself large salary increases and, most damaging, he began to take unauthorized loans from the Diner. Over the course of several years, these loans amounted to some $12 million. Plaintiffs also allege that in 2016 and 2017, Kenneth obtained a $2.5 million line of credit from Citibank. Kenneth forged Ellen’s signature on loan documents that made Ellen the personal guarantor on the loans. The books and records of the Diner reflected the loans. They also reflected certain “reductions” in the amounts of the loans. Plaintiffs, however, allege that the records purporting to show the reductions were manufactured after the fact by Kenneth.

Defendant Getzel, Schiff & Pesce, LLP (defendant) is a public accounting firm. For a period including 2012 through 2019, defendant performed certain accounting services for plaintiffs, the Diner, and Kenneth. It provided these services through a series of year-after-year engagement letters. Under the terms of these letters, for each of the relevant years, defendant agreed to provide “compilation services” and to prepare the local, state, and federal tax returns for the clients. Between 2002 and 2008, defendant’s managing partner had annual meetings with Ellen at her home, during which the partner provided her only broad summary of the Diner’s finances but never disclosed any details about the Diner’s accounting, books and records.

In 2019, Ellen hired new personal accountants who uncovered the loans to Kenneth. Apparently, in addition to taking the money for himself, Kenneth also used the “loan” proceeds to finance various other business ventures. Plaintiffs allege that defendant was the accountant to these other businesses.”

“Plaintiffs sufficiently pleaded causes of action for accounting malpractice and aiding and abetting fraud, which are not utterly refuted by the documentary evidence.

“A party alleging a claim of accountant malpractice must show that there was a departure from the accepted standards of practice and that the departure was a proximate cause of the injury” (KBL, LLP v Community Counseling & Mediation Servs., 123 AD3d 488, 488 [1st Dept 2014]). A plaintiff alleging an aiding and abetting fraud claim must allege the existence of the underlying fraud, actual knowledge, and substantial assistance (see Oster v Kirschner, 77 AD3d 51, 55 [1st Dept 2010]).

Defendant makes no contention that the claims of accounting malpractice and aiding and abetting fraud by Kenneth are not sufficiently pleaded. Instead, defendant primarily argues that the malpractice and fraud claims are refuted by the fact that the accounting firm was hired to prepare tax returns and other financial statements that documented the loans at issue, and thus that investigating and reporting Kenneth’s alleged fraud were beyond its duties.

Plaintiffs’ claims, however, are not that defendant was hired to discover Kenneth’s wrongdoing, but rather [*3]that information obtained by defendant during its business interactions with Kenneth and information used by defendant in order to prepare tax returns and financial statements put defendant on notice about the impropriety of Kenneth’s loans to himself such that defendant had a duty to inform plaintiffs of the questionable payments. The law is very clear that an agreement to perform unaudited services does not shield an accountant from liability because an accountant must perform all services in accordance with the standard of a reasonable accountant under similar circumstances, which includes reporting fraud that is or should be apparent (see 1136 Tenants’ Corp. v Rothenberg & Co., 36 AD2d 804 [1st Dept 1971], affd 30 NY2d 585 [1972]; see also William Iselin & Co., Inc. v Mann Judd Landau, 71 NY2d 420, 424-425 [1988]; United States v Natelli, 527 F2d 311, 320-321 [2d Cir 1975], cert denied 425 US 934 [1976]; Blakely v Lisac, 357 F Supp 255, 265-266 [D Or 1972]; Robert Wooler Co. v Fidelity Bank, 330 Pa Super 523, 531-535, 479 A2d 1027, 1031-1033 [1984]).

In addition, “[o]ne who aids and abets a breach of a fiduciary duty is liable for that breach as well, even if he or she had no independent fiduciary obligation to the allegedly injured party, if the alleged aider and abettor rendered ‘substantial assistance’ to the fiduciary in the course of effecting the alleged breaches of duty” (Caprer v Nussbaum, 36 AD3d 176, 193 [2d Dept 2006] [Where “the accountants had complete knowledge of the misuse of condominium funds, and were indispensable to the board-member defendants in their efforts to conceal the misuse of those funds, the accountants may be held liable for aiding and abetting the breach of fiduciary duty by the board-member defendants”]; see also Operative Cake Corp. v Nassour, 21 AD3d 1020 [2d Dept 2005]). In this case, it is alleged not only that the accountant had knowledge of Kenneth’s alleged improper transactions but that he participated in the alleged breaches.”

“Accordingly, the order of the Supreme Court, [*4]New York County (Andrew Borrok, J.), entered April 26, 2023, which, insofar as appealed from, granted defendant Getzel Schiff & Pesce, LLP’s motion to dismiss, should be reversed, on the law, without costs, and the motion denied.”

Now that Urias v. Buttafuoco, has been decided by the Court of Appeals would Gelwan v De Ratafia 2023 NY Slip Op 32953(U) August 25, 2023 Supreme Court, New York County
Docket Number: Index No. 654525/2016 Judge: David B. Cohen have been decided differently as to the Judiciary Law 487 claim?

In Urias, the Court of Appeals held ” Not only does the text of the provision suggest that a plenary action is available in all instances of attorney deceit, but section 487’s long lineage also confirms that conclusion. The cause of action was descended from the first Statute of Westminster adopted in England in 1275, incorporated in New York’s earliest common law, and first codified in this State in a 1787 statute that closely tracks the current provision (see Melcher v Greenberg Traurig, LLP, 23 NY3d 10, 14-15 [2014]; Amalfitano, 12 NY3d at 12). Its legislative history reflects a consistent view, taken over centuries, that attorney deceit in the course of litigation warrants substantial penalties—both criminal liability and treble damages. By comparison, CPLR 5015 offers a discretionary remedy that includes “restitution in like manner and subject to the same conditions as where a judgment is reversed or modified on appeal” (CPLR 5015 [d]). Such relief is markedly different from that authorized by section 487, and we decline to confine a plaintiff alleging attorney deceit to the sole option of proceeding under CPLR 5015.

We appreciate that it might be more efficient to require a plaintiff who either directly or effectively challenges a judgment to return to the court that issued it and seek vacatur under CPLR 5015, and we note that transfer of a plenary action to the court that handled the underlying proceedings may be desirable where consistent with the CPLR’s venue provisions. Nor do we take lightly the interest in preserving the finality of judgments. But the legislature has singled out the specific type of claim here—an allegation of attorney deceit on the court or a party—and determined that recovery of treble damages should be available in a civil action. We conclude that section 487 must be read to allow a plenary action for deceit, even where success on that claim might undermine a separate final judgment.”

In Gelwan, the court held:

“This action arises out of an incident which took place in 2011, the specific details of
which are not directly relevant to these motions. Plaintiffs Gelwan and Backer were retained by defendants De Ratafia and Ackroyd (De Ratafia parties) to represent them in a federal civil rights action in the Northern District of New York arising out of the incident (De Ratafia v Hyson, US Dist Ct, ND NY, 13 Civ 174, Mordue, J., 2014 [federal action]).
The retainer agreement is written on Backer’s letterhead, and provides that the De Ratafia parties have retained Backer’s firm, as well as Gelwan as “of counsel,” to commence and prosecute the federal lawsuit, and that they have agreed to pay a 40 percent contingency fee, which Backer would share equally with Gelwan (NYSCEF 18).”

“Judiciary Law § 487(1) provides that it is a misdemeanor for, and creates liability for
treble damages against, an attorney who is “guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party.”
As Gelwan was not a party in the federal action ( Gelmin v Quicke, 224 AD2d 481 [2d Dept 1996] [“party” refers to party in action]), and as the alleged misconduct occurred during the federal action and not here ( Chibcha Rest., Inc. v David A. Kaminsky & Assoc., P.C., 102 AD3d 544 [1st Dept 2013] [claim must be brought in action in which alleged misconduct occurred]), Gelwan does not state a claim for a violation of Judiciary
Law§ 487.”

Jones Law Firm, P.C. v J Synergy Green, Inc. 2024 NY Slip Op 31127(U) April 2, 2024
Supreme Court, New York County Docket Number: Index No. 653730/2023 Judge: Lyle E. Frank illustrates the principle that while there may be a Code of Professional Conduct violation, there must be a proximate connection with pecuniary damages to accompany and be cause by that violation.

“The underlying action arises out of allegations that defendant/third-party plaintiff failed to pay plaintiffs legal fees as required by its engagement agreement. The third-party action and counterclaims arise out of the plaintiffs relationship with third-party defendants PAM and David Treyster, in that defendants/third-party plaintiffs were caused to suffer damages based on the failure to disclose the relationship. It is undisputed that at the time the engagement agreement was signed by plaintiff and defendants, plaintiffs principal had a 100% ownership interest in PAM.”

“The Court finds that here, similar to the plaintiffs in Connaughton, the third-party
complaint and counterclaims fails to specify any compensable damages from PAM’ s alleged fraud. In opposition to P AMs motion the defendants/third-party plaintiffs contend that plaintiff and PAM are agents of one another and thus PAM is vicariously liable for the plaintiffs alleged fraudulent conduct. This argument however misses the mark and is also unsupported by specific factual allegations. The third-party complaint and counterclaims fail to allege a sufficient basis to pierce the corporate veil or any facts sufficient to support defendant/third-party plaintiffs’ contention that any alleged fraud caused any additional damages separate and apart from those incurred by the
alleged fraudulent conduct of plaintiff.”

” Here, the Court finds that allowing defendant/third-party plaintiffs amendment would be futile. The proposed amended complaint fails to cure the deficiencies cited above. Similarly, the Court agrees that because the third-party complaint fails to properly state a claim for an underlying tort there can be no conspiracy cause of action pursuant to Judiciary Law § 487 (Am. Preferred Prescription, Inc. v Health Mgt., 252 AD2d 414,416 [1st Dept 1998]).”

Legal malpractice claims frequently arise over real estate. in Mandour v Rafalsky
2024 NY Slip Op 31086(U) April 1, 2024 Supreme Court, New York County
Docket Number: Index No. 651819/2022 Judge: Andrea Masley there is the added (frequent) dispute between siblings with death and incompetency issues thrown in.

“Plaintiffs Nariman M. Mandour, as both beneficiary and trustee of Nariman’s
Trust, together with Martin Wm. Goldman and Harvey I. Krasner as trustees of
Nariman’s Trust, on behalf of Nariman’s Trust individually, and derivatively on behalf of
10/3 Realty Corp. (RC) initiated this action on April 22, 2022 to invalidate agreements
related to the 2014 development of 47 Third Avenue in New York City.”

“Nariman’s Trust (the Trust) was established under the last will and testament of
decedent Peter Stein (Peter) for the lifetime benefit of Mandour, his spouse. (NYSCEF
Doc No. [NYSCEF] 26, FAC ,i 1; see NYSCEF 27, Last Will and Testament at§ 1 [E]
[1].) Mandour, Goldman, and Krasner serve as trustees. (NYSCEF 26, FAC ,i
2.) During his lifetime, Peter owned 10 shares, or one-third of all shares, in nominal
defendant RC, a New York corporation, and served as its president. (Id. ,i,i 1, 14,
27.) Schlesinger, Peter’s uncle, owns 10 shares in RC. (Id. ,i,i 5, 28.) Peter’s brothers,
Fredrick and Richard each own 5 shares, or one-sixth of the shares in RC. (Id. ,i,i 6-7,
28.) In January 2019, Peter fell ill and he passed away on September 4, 2020. (Id. ,i,i
5, 27.) Peter’s shares in RC passed to the Trust under Peter’s will. (Id. ,i 1.)

Rafalsky is an attorney who, individually or through his law firm Wood, Rafalsky
& Wood LLP (WRW), has represented RC and/or TSFH. (Id. ,i,i 8-9.) Rafalsky owns
and/or operates TRRKY, a New York corporation. (Id. ,i 8.) Rafalsky served as RC’s
attorney on the Capital Contribution Agreement. (NYSCEF 28, Capital Contribution
Agreement ,i 11.6 [B].)”

“The Rafalsky defendants argue that the legal malpractice claim is time-barred. A
three-year statute of limitations governs a cause of action for legal malpractice (CPLR
214 [6]), which begins to “accrue when the malpractice is committed, not when the client learns of it.” (Palmeri v Willkie Farr & Gallagher LLP, 156 AD3d 564, 567 [1 st Dept
2017] [citations omitted].) Where the alleged malpractice claim is predicated upon the
attorney’s failure to disclose a conflict of interest, the claim accrues from that date. ( See
Kvetnaya v Tylo, 49 AD3d 608, 609 [2d Dept 2008].)
In this case, the predicate acts underlying the malpractice claim occurred prior to
May 21, 2003, when the Development Agreement was executed. Plaintiffs commenced
this action in April 2022. As discussed supra, plaintiffs have failed to raise an issue of
fact that the continuous representation doctrine tolled the limitations period. Thus, the
legal malpractice claim is dismissed as time-barred.”

Under CPLR 214-6, and according to the ensuing court decisions, any claim against an attorney, whether purely in contract, in fraud or for professional negligence is subject to a 3-year statute of limitations. This legislative fix took place after the Court of Appeals permitted a 6-year statute of limitations in contract claims. For architects, it is different, as seen in Apollo Elec., Inc. v Aman Devs. LLC 2023 NY Slip Op 33466(U) October 5, 2023 Supreme Court, New York County Docket Number: Index No. 155250/2019 Judge: Debra A. James.

” As for the first cause of action sounding in breach of contract against second third-party defendant AT Architects of the second third-party complaint, this court agrees with second third-party plaintiff that his allegations therein sound in breach of contract and not professional malpractice. As in Children’s Corner Learning Ctr v A Miranda Contr. Corp (64 AD3d 318, 324 [1 st Dept 2009]), “the damages sought [by second third party plaintiff at bar] are economic only.” Second third-party plaintiff does not seek, for example, “the cost to repair the

defects or the difference in value between a properly constructed structure and that which was in fact built”, which is the measure of damages for architectural malpractice
(Brushton-Moira Cent. School Dist. v Thomas Assoc., 91 NY2d 256, 262 [1998]). On that basis, second third party plaintiff is correct that the six-year statute of limitations for breach of contract (CPLR § 213) applies to such claim. As the second third party action was commenced on September 15, 2022, any claims against second third-party defendant that accrued before September 14, 2016, are untimely.”

It’s unusual to see a firm like Marcum LLP suing its attorneys. In this particular setting, the claim was rejected by the Appellate Division.

In Marcum LLP v L’Abbate, Balkan, Colavita & Contini, L.L.P. 2023 NY Slip Op 06443 [222 AD3d 486] December 14, 2023 Appellate Division, First Department the accounting firm claimed that its defense lawyers were negligent.

“Supreme Court correctly concluded that defendants, L’Abbate, Balkan, Colavita & Contini, L.L.P. (LBCC) and Marianne S. Conklin, who represented plaintiff in an underlying action alleging accounting malpractice, among other things, were entitled to dismissal of the complaint given that plaintiff failed to allege that defendants were negligent or that they proximately caused any damages (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]; Fielding v Kupferman, 65 AD3d 437, 442 [1st Dept 2009]). Plaintiff alleged that in the underlying action, defendants’ supplemental discovery production, which included responsive documents that had been inadvertently withheld, such as declarations submitted in connection with a federal investigation into one of plaintiff’s clients, precipitated a coverage dispute with its insurers. That dispute led to plaintiff having to retain other coverage counsel and to ultimately contribute to the settlement in the underlying action.

Although plaintiff contends that the declarations were subject to grand jury secrecy rules, plaintiff did not allege that either of the employees who composed the declarations testified before a federal grand jury, or that the declarations were entered into evidence. Thus, the declarations were not subject to the general rule of grand jury secrecy because they were not “evidence actually presented to [the grand jury]” nor “anything that may tend to reveal what transpired before it” (see United States v Eastern Air Lines, Inc., 923 F2d 241, 244 [2d Cir 1991], citing Fed Rules Crim Pro rule 6 [e] [2]). Accordingly, plaintiff failed to allege that defendants’ conduct breached its duty of care.”

“Supreme Court also correctly dismissed that part of the legal malpractice claim seeking disgorgement of attorneys’ fees paid to LBCC, which is, essentially, a claim for monetary damages in connection with its legal malpractice claim (see Access Point Med., LLC v Mandell, 106 AD3d 40, 44 [1st Dept 2013]). Defendant was not discharged for cause, nor did it charge legal fees for any work associated with the motion practice ensuing from the supplemental disclosures (see Decolator, Cohen & DiPrisco v Lysaght, Lysaght & Kramer, 304 AD2d 86, 91 [1st Dept 2003]). Since the underlying legal malpractice claim is dismissed, the claim for disgorgement must be dismissed as well (see Cambridge Capital Real Estate Invs., LLC v Archstone Enter. LP, 137 AD3d 593, 596 [1st Dept 2016]).

Plaintiff did not establish that it incurred litigation expenses as a result of defendants’ conduct to minimize or correct defendants’ mistakes (see Rudolf, 8 NY3d at 443), and this portion of the complaint seeking additional damages also should have been dismissed. Plaintiff failed to specifically allege what attorneys’ fees, if any, it paid to co-counsel to remedy any alleged shortcomings by defendants in the wake of the supplementary disclosures and defendants’ motion to withdraw from the representation. Concur—Kapnick, J.P., Friedman, González, O’Neill Levy, JJ.”

Serafini Releasing LLC v Gray 2024 NY Slip Op 30863(U) March 13, 2024
Supreme Court, New York County Docket Number: Index No. 655579/2021
Judge: Melissa A. Crane is that rare New York legal malpractice case arising out of the making of a film. Here, Plaintiff has several scenarios at play against the attorney and, in the last reel, loses all.

“In this action, plaintiff Serafini Releasing, LLC (“plaintiff” or “Serafini”), a New Yark
based film production and distribution company, originally alleged that defendant Jonathan Gray (“Gray”), an attorney, and his law firm, defendant Gray Krauss Stratford Sandler Des Rochers, LLP (“Gray Krauss”), wrongfully stole its ownership interest in a film project entitled “16 Bars” (the “Film”) and gave it to another party, Gary Gumowitz (“Gumowitz”). Susanne Bohnet (“Bohnet”) is the chief operating officer and sole member of plaintiff. Plaintiff claimed that Gray was its attorney, that it relied on and trusted him, and was shocked to learn it “lost” its rights to the Film.

Plaintiffs theory of the case has been a moving target. During motion practice, plaintiff
abandoned its ownership claim. Plaintiff now claims that Gray began prioritizing the interests of Gumowitz, the Film’s investor and owner. Plaintiff claims Gray stripped plaintiff of the managerial rights that would have allowed it creative and managerial control over the completion and release of the Film. Plaintiff claims it had the right to complete the Film regardless of budget, and that Gumowitz and his company, 16 Bars Feature Film LLC, would be obligated to continue to finance the Film without limit or discretion until its completion.”

“In its first cause of action for breach of fiduciary duty, plaintiff alleges that “[i ]n their role as attorneys retained by Plaintiff, Defendants assumed the role of fiduciary to Plaintiff and owed fiduciary duties to Plaintiff’ (amended complaint,, 88). Plaintiff further alleges that defendants breached those duties by “drafting and directing Plaintiff to execute legal documents that stripped Plaintiff of the rights and authority over its own Film” (id.,, 94).

In its second cause of action for “negligent advice causing damage,” which sounds in
legal malpractice, plaintiff alleges that, “[b ]eginning in November 2018, Plaintiff consulted with Defendants Gray and Gray Krauss for the express purpose of engaging Defendant Gray to act as production counsel for the Film and protect Plaintiffs interests in connection with it.” Plaintiff further alleges these services included “Gray providing Plaintiff direction and advice on numerous legal questions and matters related to the production of the Film and Plaintiffs control over it” (id., ,r 102). Plaintiff further alleges that “[ d]uring that time, however, Defendants exercised intentional and repeated lack of due care in advising Plaintiff,” that included “advising Plaintiff to accept and/or sign documents that stripped it of its creative and business control over the Film” (id., ,r 1 04).
A cause of action to recover damages for negligence sounding in legal malpractice has
three elements: (1) that the defendant failed to exercise that degree of care, skill, and diligence commonly possessed and exercised by an ordinary member of the legal community, (2) that such negligence was the proximate cause of the actual damages plaintiff sustained, and (3) that, but for the defendant’s negligence, the plaintiff would have been successful in the underlying action (Leder v Spiegel, 9 NY3d 836, 837 [2007]; accord Century Prop. & Cas. Inc. Corp. v McManus & Richter, _ AD3d _, 2024 NY Slip Op 00799, * 5 [1 st Dept 2024]). To succeed on a motion for summary judgment dismissing the complaint in a legal malpractice action, the defendant must present evidence in admissible form establishing that the plaintiff is unable to prove at least one essential element of his or her cause of action alleging malpractice (Schoenberg v Dankberg, 2020 NY Slip Op 33133[U] [Sup Ct, NY County 2020]).

To establish causation, a plaintiff must demonstrate that, but for the attorney’s
negligence, she would have prevailed in the underlying matter, or would not have sustained any ascertainable damages ( Brooks v Lewin, 21 AD3d 731, 734 [ pt Dept 2005]). The failure to establish proximate cause mandates the dismissal of a legal malpractice action, regardless of the attorney’s negligence (id.; see e.g. Jarmuth v Wagner, 219 AD3d 1248, 1249 [l5t Dept 2023] [ dismissing malpractice claim “because plaintiff did not, and cannot, adequately plead that this advice and conduct was the proximate cause of damage suffered by the co-op,” as “(t)he complaint contains no nonconclusory allegations suggesting that the purported negligence by defendants was the ‘but for’ cause of the co-op sustaining actual damages”]). A plaintiffs speculation about loss resulting from an attorney’s alleged omission is insufficient to sustain a case of legal malpractice (Dempster v Liotti, 86 AD3d 169, 177 [2nd Dept 2011]; see e.g. Weis v Rheem, Bell & Freeman, LLP, 217 AD3d 538, 539 [1 st Dept 2023] [“Defendants were entitled to dismissal of the complaint given that plaintiffs failed to allege actual and ascertainable damages that were proximately caused by defendants’ alleged malpractice” as “the allegations of proximate causation depend on multiple speculative allegations”]).”

The now bankrupt defendant in a personal injury case is suing her insurance carrier and her defense attorney after they failed to settle the case once summary judgment had been awarded to the injured party in Pergament v Government Empls. Ins. Co. (“GEICO”) 2024 NY Slip Op 01568 Decided on March 20, 2024 Appellate Division, Second Department. The motion was mostly denied.

“The defendant Government Employees Insurance Company (“GEICO”) (hereinafter Geico) retained the defendants Picciano & Scahill, LLP, and Gilbert J. Hardy (hereinafter together the law firm defendants) to represent Melissa Gace Bryant, who was a defendant in a personal injury action (hereinafter the underlying action). The plaintiff, the trustee of Bryant’s bankruptcy estate, subsequently commenced this action against Geico and the law firm defendants. As against Geico, the complaint alleged three causes of action: (1) bad faith refusal to settle the underlying personal injury action for the subject policy limit after a motion for summary judgment on the issue of liability was granted in favor of the underlying injured plaintiff, (2) breach of the covenant of good faith and fair dealing, and (3) punitive damages. As against the law firm defendants, the complaint alleged a cause of action for legal malpractice. Geico and the law firm defendants separately moved [*2]pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against each of them. The Supreme Court denied the motions. Geico and the law firm defendants separately appeal.”

“Here, with respect to the causes of action against Geico alleging bad faith refusal to settle the underlying personal injury action for the subject policy limit and breach of the covenant of good faith and fair dealing, the medical reports submitted by Geico in support of its motion do not constitute “documentary evidence within the intendment of CPLR 3211(a)(1)” (Jeffrey v Collins, 218 AD3d 451, 453), and Geico’s evidentiary submissions were “insufficient to utterly refute the plaintiff’s factual allegations” (Davis v Henry, 212 AD3d 597, 598). Further, after considering the evidentiary proof submitted by Geico, the Supreme Court properly determined that the plaintiff had causes of action against Geico alleging bad faith refusal to settle the underlying personal injury action for the subject policy limit and breach of the covenant of good faith and fair dealing (see East Ramapo Cent. Sch. Dist. v New York Schs. Ins. Reciprocal, 199 AD3d 881, 884; CBLPath, Inc. v Lexington Ins. Co., 73 AD3d 829, 830-832; Brennan v Mead, 73 AD2d 926, 927; cf. Little Princess Express Cab Corp. v American Tr. Ins. Co., 12 AD3d 266, 267). Accordingly, the court properly denied those branches of Geico’s motion which were pursuant to CPLR 3211(a)(1) and (7) to dismiss the causes of action alleging bad faith refusal to settle the underlying personal injury action for the subject policy limit and breach of the covenant of good faith and fair dealing.

The Supreme Court should have granted that branch of Geico’s motion which was pursuant to CPLR 3211(a)(7) to dismiss the cause of action for punitive damages against it because “no separate cause of action for punitive damages lies for pleading purposes” (Crown Fire Supply Co., Inc. v Cronin, 306 AD2d 430, 431; see Podesta v Assumable Homes Dev. II Corp., 137 AD3d 767, 770). However, the complaint, “although inartfully drafted,” (Leon v Martinez, 84 NY2d at 88), adequately alleges a demand for punitive damages based on the remaining causes of action asserted against Geico (see Rocanova v Equitable Life Assur. Socy. of U.S., 83 NY2d 603, 613; Perlbinder v Vigilant Ins. Co., 190 AD3d 985, 989; 25 Bay Terrace Assoc., L.P. v Public Serv. Mut. Ins. Co., 144 AD3d 665, 666-668; 2015 Freeman LLC v Seneca Specialty Ins. Co., 136 AD3d 531, 532).

Accepting the facts as alleged in the complaint as true, and according the plaintiff the benefit of every possible favorable inference (see Leon v Martinez, 84 NY2d at 87-88), the complaint sufficiently stated a cause of action alleging legal malpractice against the law firm defendants (see Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34; Young v Nationwide Mut. Ins. Co., 21 AD3d 1099). Accordingly, the Supreme Court properly denied that branch of the law firm defendants’ motion which was pursuant to CPLR 3211(a)(7) to dismiss the cause of action alleging legal malpractice against them.”