Our meme today, again, is that legal malpractice is to be found in all endeavors involving attorneys.  It is no stranger to Bankruptcy proceedings, and in today’s case, a verdict is found against a Long Island Bankruptcy attorney.  Mizuno v Fischoff & Assoc. ;2010 NY Slip Op 50064(U) Decided on January 14, 2010 Supreme Court, Suffolk County ;Whelan, J.  demonstrates how plaintiff lost his house when the case could have been saved.  Supreme Court, Suffolk County entered a judgment for plaintiff in a substantial amount.
 

"Can a homeowner who loses his home to foreclosure, after filing four separate bankruptcy petitions, prevail on a legal malpractice claim against his bankruptcy attorney and recoup the remaining equity in the home as damages? This Court not only finds the claim to viable but, based upon this record, holds that a substantial award of damages is appropriate. "

"In order to prevail in an action to recover damages for legal malpractice, a plaintiff must establish both that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, resulting in actual damages to the plaintiff, and that "but for" the attorney’s negligence, the plaintiff would have succeeded on the merits in the underlying action or not have sustained any damages (Dupree v Voorhees, _ AD3d _ , 2009 WL 4681166 [2d Dept Dec. 8, 2009]; Ali v Fink, 67 AD3d 935, _ NYS2d _ [2d Dept 2009]; Santiago v Fellows, Epstein & Hymowitz, P.C., 66 AD3d 758, 886 NYS2d 766 [2d Dept 2009]).

Here, it is obvious, from the testimony of defendant’s associate, that the provision in the Conditional Order which held that a default would not be protected by the filing of a new petition, was simply forgotten. The legal advise to commence a new bankruptcy proceeding was contrary to the dictates of the May 1, 2000 order and offered no protection to plaintiff, in response to the foreclosing bank’s claim that plaintiff was in default of the Conditional Order. Moreover, the defendant’s law office just assumed that plaintiff had not complied with the Conditional Order and accepted the representations made by the foreclosing bank’s attorney."
 

"With regard to the element of causation, plaintiff has to show that he would not have incurred any damages but for the attorney’s negligence. Defendant attempted to show that plaintiff did not have the ability to pay the monthly mortgage payments and offered plaintiff’s tax returns for the 1998 (Def. Ex. P), 1999 (Def. Ex. Q), 2000 (Def. Ex. L), 2001 (Def. Ex. M), and 2002 (Def. Ex. O) as evidence of plaintiff’s inability to pay. Plaintiff offered bank account statements from December 2001 to April 2002 (Pl. Ex. 8) to demonstrate the ability to pay the monthly payments. Plaintiff also testified that for the year, 2002, the month of July was the only [*6]month that he would have had difficulty making the required payments.

In deciding the issue of causation, the Court need not speculate as to the financial ability of the plaintiff to pay into the future. The sole issue to be determined is whether "but for" the negligence of the defendant, plaintiff would not have lost his home to foreclosure. Here, plaintiff satisfied his burden by the submission of evidence that he could comply with the Conditional Order during the time frame in question, that is, satisfaction of the November 15, 2001 payment by January 15, 2002 and each monthly payment thereafter up to the foreclosure sale date of April 4, 2002. Such evidence satisfied plaintiff’s obligation to establish causation.

Having found for the plaintiff on the issue of liability, the Court must address the issue of damages. The object of awarding damages in a legal malpractice action is "to make the injured client whole" (Campagnola v Mulholland Minion & Roe, 76 NY2d 38, 42, 556 NYS2d 239 [1990]). Compensatory damages are generally awarded where a plaintiff can demonstrate that he or she suffered any actual damages (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 31 AD3d 418, 818 NYS2d 153 [2d Dept 2006]). "

Plaintiff sues law firm for legal malpractice.  Case rests on representation in a commercial real estate lease.  There was a four year period in which the landlord was building the premises, and the question of in what year  a tax escalation clause starts led to this legal malpractice case. 

Global Bus. Inst. v Rivkin Radler, LLP 01/13/2010 Other Courts 2010 NYSlipOp 30062(U)  follows a familiar path in which the court makes factual determinations, as a matter of law even when the parties have not moved for summary judgment.

Several years ago, the matter was transferred to Civil Court pursuant to CPLR 321(d).  Now plaintiff seeks to increase the ad damnum clause and restore to Supreme Court.  They fail, because the court scrutinizes the evidence and determines [via summary judgment or something like it] that it was the client and not the law firm who negotiated the tax escalation clause themselves.

Judiciary Law  487 is suddenly all the rage.  Ironic, as it may be the oldest statute in Anglo-American jurisprudence, coming only years after the Magna Carta.  We see references to  Marbury v. Madison once in a while, but this statute is  perhaps 500 years older.

Here, in Cinao v. Reers, Index no.  12274/04 , Supreme Court, Kings County, we see a discussion of whether a case must be pending in a New York Court for Judiciary Law 487 to apply.

There is scant judicial opinion on this issue.  Justice Battaglia discusses his take on whether a case in Hawaii, with a NY plaintiff and a NY attorney might fall under Judiciary Law 487.

"Based as it is on a line of judicial decisions, beginning with the Second Circuit’s decision in Schertenleib v. Traum (589 F2d 1156 [2d Cir 1978]), Defendant’s most serious objection to Plaintiff’s motion is that Judiciary Law §487 applies only to misconduct by attorneys in connection with proceedings pending in New York courts. As stated by the Second Circuit:

"[S]ection 487…is…intended to regulate, through criminal and civil sanctions, the conduct of litigation before the New York courts. We doubt it was the purpose of the New York legislature to fasten on its attorneys criminal liability and punitive damages for acts occurring outside the state. It seems more likely that the concern is for the integrity of the truth-seeking processes of the New York courts, not for injury to foreign litigants." (Id. at 1166.)

No authority or other source is cited by the court for its understanding of the New York Legislature’s intent as to the scope of Judiciary Law §487. Schertenleib was relied upon by a federal district court in dismissing a §487 claim based upon a restraining order obtained from a federal district court in Florida, stating that "Section 487 only applies to conduct within the borders of New York State" (see Papworth v. Steel Hector & Davis, 2007 US Dist LEXIS 72864, * 33 [NDNY 2007]; see also Nardella v. Braff, 621 F Supp 1170, 1172 [SDNY 1985].) The subsequent decisions by federal courts have not added to Schertenleib’s rationale.

Schertenleib has been relied upon in one New York state court decision. Civil Court held in Southern Blvd. Sound v. Felix Storch Inc. (165 Misc 2d 341 [Civ Ct, NY County 1995], mod. on other grounds 167 Misc 2d 731 [App Term, 1st Dept 1996]) that "Judiciary Law §487 (1) does not apply to acts committed in courts of States other than the State of New York" (see id. at 344), offering the following rationale:

"If the Legislature wanted to regulate the behavior of New York State attorneys in courts other than those of our State, it would have had to have been more specific or have stated ‘any court’ in Judiciary Law §487 (1). The use of the term ‘the court’ means a court of the State of New York." (Id.)

Civil Court’s reading may be even narrower that the Second Circuit’s if understood as precluding applicability of the statute to deceit on a federal court sitting in New York. In any event, this Court respectfully disagrees if either court would refuse to apply the statute here for the sole reason that the allegations relate to proceedings pending in a Hawaii court and not a court sitting in New York.

The statute itself states no such limitation. "The statutory text is the clearest indicator of legislative intent." (Maraia v. Orange Regional Med. Ctr., 63 AD3d 1113, 1116 [2d Dept 2009] [internal quotation marks and citations omitted].) "[A] court cannot amend a statute by inserting words that are not there, nor will a court read into a statute a provision which the Legislature did not see fit to enact." (Matter of Charles S., 60 AD3d 954, 955 [2d Dept 2009] [internal quotation marks and citations omitted].)

"[T]he statute’s evident intent [is] to enforce an attorney’s special obligation to protect the integrity of the courts and foster their truth-seeking function" (see Amalfitano v. Rosenberg, 12 NY3d at 14), with a related "concern for curbing and providing redress for attorney overreaching vis-a-vis clients" (see Liddle & Robinson v. Shoemaker, 276 AD2d 335, 336 [1st Dept 2000].) The first New York statute on the subject, adopted in 1787, provided redress for attorney deceit or collusion "in any court of justice." (See Amalfitano v. Rosenberg, 12 NY3d at 12 [quoting L 1787, ch 36, §5] [emphasis added].)

Generally, Judiciary Law §487 "applies only to wrongful conduct by an attorney in an action that is actually pending." (See Mahler v. Campagna, 60 AD2d 1009, 1012 [2d Dept 2009].) "Where the deception is directed against a court, a pending judicial proceeding is not required; it is sufficient if the deception relates to a prior judicial proceeding or one which may be commenced in the future." (Singer v. Whitman & Ransom, 82 AD2d 862, 863 [2d Dept 1981]; see also Costalas v. Amalfitano, 305 AD2d 202, 204 [1st Dept 2003]; Hansen v. Caffry, 280 AD2d 704, 705 [3d Dept 2001].) "Deception of a court is not confined to the actual appearance in court but has reference to any statement, oral or written, made with regard to a proceeding brought or to be brought therein and communicated to the court with intent to deceive." (Fields v. Turner, 1 Misc 2d 679, 681 [Sup Ct, NY County 1955]; see also Amalfitano v. Rosenberg, 533 F3d 117, 123 [2d Cir 2008].)

The limitation, in the case of deceit of a party, to a pending proceeding was first articulated by the Court of Appeals more than a century ago in Loof v. Lawton (97 NY 478 [1884].) "The ‘party’ referred to is clearly a party to an action pending in a court in reference to which the deceit is practiced, and not a person outside, not connected with the same at the time or with the court." (Id. at 482.) "In placing a construction upon the section cited," a predecessor to Judiciary Law §487, "we should consider its provisions in connection with others which relate to the same general subject, and in view of the object to be attained." (Id. at 481-82.)

With respect to Supreme Court’s ruling in Southern Blvd. Sound (165 Misc 3d 341), there is nothing in Judiciary Law §487 that would limit its applicability to deceit practiced on a court sitting in New York, and a limitation cannot be fairly implied from the use of the definite article "the," rather than the indefinite article "a." Section 487 appears as part of Article 15 of the Judiciary Law, "Attorneys and Counselors," with statutory provisions governing the admission and supervision of attorneys. The "integrity of the courts and…their truth-seeking function" (see Amalfitano v. Rosenberg, 12 NY3d at 14) is no less worthy of protection because the court sits in a sister state, and, in any event, the statutory purpose extends to "curbing and providing redress for attorney overreaching vis-a-vis clients" (see Liddle & Robinson v. Shomaker, 276 AD2d at 336.)

This Court is not bound by the federal court decisions in Schertenlieb and its progeny, nor is it bound by Supreme Court’s and Appellate Term’s decision in Southern Blvd. Sound. (See Cox v. Microsoft Corp., 290 AD2d 206, 207 [1st Dept 2002]; People v. Gundarev, 2009 NY Slip Op 51972 [U], * 1-* 2 [Crim Ct, Kings County 2009]; King Transp. Servs. v. State, 185 Misc 2d 684, 687 [Ct Cl 2000].) Nonetheless, a court should be reluctant to divert from an accepted view of the law, particularly where interpretation of a statute is at issue. Here, however, only the Schertenleib and Southern Blvd. Sound courts offered any reasoning to support the implied limitation on the applicability of Judiciary Law §487, and neither cited any authority or other support for its reading of the statute.

In light of the statutory language and purposes, this Court sees no basis for limiting the applicability of Judiciary Law §487 to judicial proceedings pending in New York courts. A New York court has sufficient interest in supervising the conduct of attorneys admitted before its bar, and protecting resident clients who have been harmed by the deceit of an admitted attorney, to apply Judiciary Law §487 to the attorney’s conduct no matter where the action is pending."

Attorney fees and legal malpractice should have nothing to do with each other.  However, the general rule is that no legal fees may be awarded in the face of legal malpractice and its corollary is that if legal fees are awarded by a court or tribunal, then there could have been no legal malpractice, whether the issue is briefed or not.

Here is another example: Liberty Assoc. v Etkin ; 2010 NY Slip Op 00225 ; Decided on January 12, 2010 ;Appellate Division, Second Department :
 

"In January 2003 the Ravin Firm commenced an action against Liberty Associates in the Superior Court of New Jersey to recover fees for the legal services rendered. In 2004, during the pendency of the instant action, Liberty Associates and the Ravin Firm settled the New Jersey fee dispute action (hereinafter the fee dispute action), which was dismissed with prejudice. Upon learning of the settlement, Etkin moved for summary judgment dismissing the complaint in the instant action. The Supreme Court granted the defendant’s motion. We affirm. ""This action to recover damages for legal malpractice against Etkin, as a member of the Ravin Firm, arises out of the same series of transactions as the fee dispute action asserted by the Ravin Firm against the plaintiff herein for legal fees. Upon resolution of the fee dispute action, the parties, by their attorneys, executed a stipulation of dismissal with prejudice and without costs. A stipulation of discontinuance with prejudice without reservation of right or limitation of the claims disposed of is entitled to preclusive effect under the doctrine of res judicata (see Matter of Hofmann, 287 AD2d 119, 123 ["An order of discontinuance effecting settlement on the merits is accorded the same res judicata effect as the entry of judgment on the merits"]; see also Fifty CPW Tenants Corp. v Epstein, 16 AD3d at 294).

Here, Etkin established, prima facie, that the legal services at issue in the instant action and in the fee dispute action were the same and, thus, that Liberty Associates’ settlement of the fee dispute action with the Ravin Firm, of which Etkin was a member, precludes Liberty Associates from maintaining the instant action against Etkin under the doctrine of res judicata (see Izko Sportswear Co, Inc. v Flaum, 25 AD3d 534, 537)."

It should be fairly easy to determine when the statute of limitations ends, no?  In legal malpractice, one must commence an action within three years of when the cause of action accrues, unless there continues to be "continuous representation."  When does the cause of action accrue?  This question remains thorny, and not always easily resolved.  Here, as an example is 730 J & J, LLC v Polizzotto & Polizzotto, Esqs. ;2010 NY Slip Op 00244 ;Decided on January 12, 2010 ;Appellate Division, Second Department  found that the statute had not expired some 6 years after the "error" and at least 5 years after another specified date that defendants argued was the start:
 

"Summary judgment based on the defense of the statute of limitations requires that a defendant make a prima facie showing that an action to recover damages for legal malpractice was filed more than three years after the cause of action accrued (see CPLR 214[6]; Rachlin v LaRossa, Mitchell & Ross, 8 AD3d 461), when "all the facts necessary to the cause of action have occurred and an injured party can obtain relief in court" (McCoy v Feinman, 99 NY2d 295, 301 [internal quotation marks omitted]). An action to recover damages for legal malpractice is deemed to accrue on the date the [*2]malpractice was committed, not when it was discovered (see Shumsky v Eisenstein, 96 NY2d 164, 166).

Under the doctrine of "continuous representation," the three-year statue of limitations for legal malpractice is tolled while the attorney continues to represent the client in the same matter in which the malpractice allegedly occurred, after the alleged malpractice is committed (Shumsky v Eisenstein, 96 NY2d at 168). The parties must have a "mutual understanding" that further representation is needed with respect to the matter underlying the malpractice claim (McCoy v Feinman, 99 NY2d at 306).

Here, the defendant failed to establish its prima facie entitlement to summary judgment dismissing the legal malpractice cause of action by demonstrating that the statute of limitations expired (see generally Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853). Accordingly, the Supreme Court properly denied that branch of the defendant’s motion which was for summary judgment dismissing the complaint as time-barred without prejudice to renewal after completion of discovery.

Plaintiff starts a case on their own, and then when they get near trial, hire the defendant attorneys to represent them in an action for personal injury to their child either at school, or due to the alleged negligence of the School district.  The attorneys take over, and are said to agree that they can provide a doctor/expert and obtain all the necessary medical records to try the case.

Defendants take the case off the trial calendar, work/fool around with it for a few months, then "Plaintiffs were given one year to restore the case to the calendar but failed to timely comply, and defendant subsequently refunded plaintiffs’ retainer and terminated the representation. Six months after their time to do so had expired, plaintiffs moved, pro se, to restore the case to the calendar. Supreme Court (Meddaugh, J.) denied the motion and dismissed the case with prejudice retroactive to June 14, 2005, finding that plaintiffs "set forth no meritorious claim [and] no reasonable excuse for their failure to restore the case to the calendar within [one] year of the case being struck." Plaintiffs’ subsequent pro se submission, attaching affidavits, letters and reports from plaintiffs’ medical providers was deemed a motion to renew/reargue. In denying that motion, the court noted that the papers submitted with that application "were couched in only the most conclusory terms and failed to establish any causal connection between any allegedly improper conduct by [the school district] and the [infant’s] medical conditions."
 

Plaintiffs sue for legal malpractice and defendants move to dismiss the complaint.  The Court’s decision reads: "Defendant’s attempt to invoke collateral estoppel is unavailing. Plaintiffs’ motion to restore their case against the school district to the calendar required a showing of merit sufficient to establish a triable issue of fact (see Alise v Colapietro, 119 AD2d 921, 922 [1986]) and conclusory allegations are inadequate in that setting (see Fountain v Village of Canastota, 219 AD2d 781, 782 [1995]). In contrast, on defendant’s motion to dismiss, plaintiffs’ allegations, including conclusory allegations in supporting affidavits, are deemed to be true (see Berry v Ambulance Serv. of Fulton County, Inc., 39 AD3d 1123, 1124 [2007]). Defendant, therefore, failed to carry his burden to establish an identity of issues between the two actions and is not entitled to invoke the doctrine of collateral estoppel (see Cary v Fisher, 149 AD2d 890, 891 [1989]).

On the record before us, plaintiffs have stated a cause of action for legal malpractice. "’In order to sustain a claim for legal malpractice, a plaintiff must establish both that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession which results in actual damages to a plaintiff, and that the plaintiff would have succeeded on the merits of the underlying action "but for" the attorney’s negligence’" (Leder v Spiegel, 9 NY3d 836, 837 [2007], cert denied Spiegel v Rowland, ___ US ___, ___, 128 S Ct 1696 [2008], quoting AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434 [2007] [internal citation omitted]). Although plaintiffs’ evidence may be insufficient to withstand a motion for summary judgment, on an unconverted preanswer motion to dismiss, plaintiffs’ allegations are accepted as true and are entitled to the benefit of every reasonable inference (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]; Rovello v Orofino Realty Co., 40 NY2d 633, 634 [1976]).

How does one prove legal malpractice, and what documents are necessary to support a successful legal malpractice case?  A colliery to that question is how do you get those documents, and when is a request too broad, and when does a demand go to far?  An illustration of a request which went too far is found in Aaron v Pattison, Sampson, Ginsberg & Griffin, P.C. ;2010 NY Slip Op 00342 ;Decided on January 14, 2010 ;Appellate Division, Third Department .
 

Aaron asked for: "documents showing Katzman’s time entries and billings related to other client matters; documents showing Katzman’s employment contracts, partnership agreements and income; evidence of loans to Katzman by PSGG; evidence of any malpractice suits against Katzman; claims against Katzman made to the Committee on Professional Standards; documents showing Katzman’s absences from work, including vacation, personal and sick time; and documents pertaining to Katzman’s reviews, disciplinary actions, internal grievances, demotions and promotions. "

Instead of getting such documents, he ended up paying attorney fees to the other side.  "As Aaron has failed to demonstrate that these materials are in any way material and necessary to proving a claim of legal malpractice (see AmBase Corp. v Davis Polk & Wardwell, [*3]8 NY3d 428, 434 [2007]) or to defending against PSGG’s claims for counsel fees, the motion to compel must be denied (see CPLR 3101 [a]). Furthermore, under the same rationale, we find that Supreme Court did not abuse its discretion in granting the protective order (see CPLR 3103 [a]). Nor do we find an abuse of discretion in the award of counsel fees and costs on the motion (see 22 NYCRR 130-1.1 [a]). As set forth in the court’s amended order, Aaron’s motion to compel the production of the patently immaterial and unnecessary information detailed above was nothing more than a "fishing expedition" made for the "illegitimate purpose" of "uncovering facts supporting insufficient, conclusory allegations."

in Lyons v Cronin & Byczek, LLP 01/06/2010 2010 NYSlipOp 30006(U Plaintiff started an employment discrimination case against the LIRR and while it was pending, filed a petition in Bankruptcy.  How this fact was not known to his attorneys, or the LIRR is not explained, but he settled the case and accepted the proceeds.  Later, after being discharged in Bankruptcy.

He was dissatisfied with the settlement, and retained the target attorneys to sue his former attorneys.  In this round it was established that he had filed bankruptcy during the pendency of the underlying case, and the rule is that he lost rights to that case at the moment that the petition was filed.  It belonged to the debtor’s estate, to be administered by the Chapter 7 trustee.

So, case dismissed.  Now he sues his own attorneys, saying that they should have known.  If they knew, they also should have known that he could move to reopen the bankruptcy, amend the petition and schedules, have the trustee cede the cause of action back to him, and refile under CPLR 205. They didn’t, and this forms the basis of his second legal malpractice action.

Currently, motion for summary judgment by the target attorney was dismissed.