Some combinations are simply counter-intuitive…ice cream and pickles, waffles and fried chicken, the US House of Representatives and legal malpractice.  Once explained, they are clear as a bell.  The South Carolina Appellate Blog explains how the US legislative body got involved in this legal malpractice case:

"In Spence v. Wingate, the South Carolina Court of Appeals granted a grant of partial summary judgment in a legal malpractice claim. At base, the trial court had held that the law firm did not owe a fiduciary duty to the wife concerning her late husband’s life insurance policy. The law firm represented the wife of the late Congressman Floyd W. Spence. The law firm originally undertook representation to negotiate an agreement on wife’s behalf with four sons of her husband regarding a division of the probate estate. During the course of the representation, the wife also consulted with the law firm about her husband’s federal life insurance policy and informed the law firm that Spence had named her as a beneficiary. The facts developed that shortly before his death Spence did attempt to change the beneficiary on his life insurance policy so the wife would be the sole beneficiary. Prior to this attempted change, Spence had named each of his four sons and the wife as equal beneficiaries. The United States House of Representatives determined that the proceeds should be divided equally among the wife and the four sons. "

Law Com reports that two former clients have sued Howrey LLP and its partner Michael S. Dowler over a failed deal to purchase a patent.  While normally this would not be of interest in a legal malpractice setting, the allegation is that the defendant demanded an ‘under the radar" deal for 505 of the net profits, and then "breached his fiduciary duty by `misrepresenting the value of the patent.’"

Frederick Rehberger, appellant, v Garguilo & Orzechowski, LLP, et al., respondents.

(Index No. 30120/05)
2007-05158
SUPREME COURT OF NEW YORK, APPELLATE DIVISION, SECOND DEPARTMENT
2008 NY Slip Op 3187;
April 8, 2008, Decided

Plaintiff’s Suffolk County case dismissed on 3211(a)(5) grounds, and reversed upon adequate showing of continuous representation.

Milton B. Shapiro, etc., respondent, v Deborah Shapiro Kurtzman, appellant, et al., defendants. (Index No. 7875/01)

2007-01139, 2007-07057
SUPREME COURT OF NEW YORK, APPELLATE DIVISION, SECOND DEPARTMENT
2008 NY Slip Op 3194;
April 8, 2008, Decided

Borrower successfully moves to dismiss case against lender based on failure in discovery. Lender moves to vacate on the basis that its attorney retired from practice suffering from Alzheimer’s syndrome. Court vacates, but imposes a $ 10,000 sanction. Queery: how did the lender get its attorney’s medical/psychiatric records? Now did it present this info to the court? Why a big sanction?

We reported on this situation more than a year ago. Leeds Morelli & Brown apparently cut its own deal not to sue Prudential again, in exchange for a hefty legal fee paid to it.  One of its clients, Linda Guyden, is trying to set aside an arbitration award on the basis that her attorney was conflicted.  Here is the latest fromOverlawyered:

"The law firm of Leeds Morelli & Brown has recently been embroiled in controversy over episodes in which it has settled batches of employment discrimination claims while contemporaneously entering agreements in which the defendants agree to hire it (the Leeds Morelli firm) for substantial sums. Now an African-American woman who was once a vice president at Prudential Insurance and then sued the company for racial bias as a Leeds Morelli client "is asking a federal judge to set aside an arbitration award, alleging her lawyers were given improper financial inducement to keep her claim and hundreds of others out of court. According to Linda Guyden, the company paid $5 million to the law firm representing her and 358 other employees, in return for which Prudential’s total exposure was capped at $10 million and the claims were kept secret."

Bankruptcy legal malpractice is again in the news.  As the economy cycles through bankruptcy issues, attorneys advising large corporations become targets for the trustees as well as the creditors.  Latest in the news is the Catholic Medical Center and McDermott, Will & Emery.

From Law.Com: "A bankruptcy trustee for Saint Vincent’s Catholic Medical Centers of New York has sued McDermott, Will & Emery for legal malpractice, charging that partners at the Chicago-based law firm "put their personal relationships and selfish economic concerns above the interests of the charitable institution they were entrusted to protect."

The 75-page complaint, filed Monday in Manhattan Supreme Court by trustee Richard Gray, alleges McDermott Will put off a much-needed Chapter 11 filing to facilitate self-dealing by two other members of the hospital group’s restructuring team. As a result of the delay, the trustee claims, Saint Vincent’s incurred greater operating losses, paid more professional fees and took longer to emerge from bankruptcy after it finally did file.

The suit is requesting $1.2 billion in damages for legal malpractice, fraud and breach of fiduciary duty, among other claims, as well as disgorgement of $4.5 million in previously paid legal fees. In addition to the firm itself, partners William P. Smith, Stephen B. Selbst and David D. Cleary are individually named as defendants. "

This New Jersey real estate case makes little sense, unless you read it as envy transformed into litigation.  Plaintiff-seller decides to sell 6 lots for $ 2,000,000.  Everyone follows the contract of sale, which provided for interim payments, penalty payments, and no assignments.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION

MARIO ARGENZIANO and MARAGEN CORPORATION, Plaintiffs-Appellants, v. THOMAS YACCARINO, ATLANTIC GROUP REALTY, BY THE SEA REAL ESTATE, LLC, WILLIAM WEBBER, ANDREW BOECKEL, LIBERTY CIRCLE LLC, TROUTMAN PORT, LLC and JOSEPH MEEHAN,

In the meantime, buyer finds customers who are willing to pay $ 2.5 million for the 6 lots, and arranges to flip them at closing.  Plaintiff is paid its contract price, and when it finds out that buyer found a way to make a profit, sues.   The court found: "With respect to defendant Meehan, plaintiffs’ claim was that the attorney breached a duty of care owed to plaintiffs by advising them to grant a six-month extension to buyers and thereby caused plaintiffs to lose an opportunity to retain the property and its appreciated value. Although plaintiffs produced an affidavit of merit, they did not provide an expert report or request an adjournment of the summary judgment motion to permit them to secure one. Thus, they did not have evidence to establish that the attorney breached a duty of care."

This case from New Jersey illustrates the difficult question of privity, which is another way to say, does plaintiff have a relationship with the attorney such that he may sue?

In SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION

CHARLES W. GEYER, on behalf of ONE WASHINGTON PARK URBAN RENEWAL
ASSOCIATES (OWPURA),  v. PITNEY, HARDIN, KIPP & SZUCH,  PETER A. FORGOSH, ESQ.,; JONATHAN S. BRISTOL, ESQ., JOEL ROSEN, ESQ., and DOUGLAS A. KENT, ESQ.,
we see the following:

"This legal malpractice action was dismissed by way of summary judgment. In these cross-appeals, we consider defendants’ argument that plaintiff lacked standing to bring this suit, and plaintiff’s argument that there was sufficient evidence of professional negligence and proximate cause to defeat summary judgment. Although we conclude that the trial judge erred in his view of the merits of some of plaintiff’s claims, we direct that the bulk of the action be dismissed without prejudice because we agree plaintiff lacked standing to pursue all but one of his claims. And we also hold that the one claim defendant had standing to pursue was without merit and properly dismissed. "  For the play by play, see the entire case.

There are red flags all  over this case.  Ex-sheriff was jailed for corruption, sued the government attorney from his administration and did not present an expert.

 

" A judge in Newark yesterday threw out a legal malpractice suit brought by Thomas D’Alessio, former Essex County sheriff and county executive, against his administration’s top lawyer.

Superior Court Judge Paul J. Vichness delivered his decision from the bench after D’Alessio’s lawyer, Anthony Ambrosio, presented his case against Stephen J. Edelstein, who served as Essex County counsel from 1991-94.

Edelstein’s lawyer, Dennis Drasco, had asked for the dismissal in legal arguments that lasted a couple of hours.

Drasco maintained D’Alessio, who wound up in federal prison for accepting bribes, had failed to establish there was any standard of professional conduct that Edelstein violated in handling D’Alessio’s reopened divorce proceedings in the ’90s.

He also noted that no legal experts took the stand in the trial that began last month to claim Edelstein departed from any such standard.

"Their proofs didn’t meet the threshold," said Drasco, after the ruling..  Ex -sheriff  is plaintiff and was convicted and jailed for corruption.  He sues administration’s attonrey.  He presents no expert."

From today’s NYLJ:  "A New York judge has allowed a legal malpractice suit alleging faulty due diligence work by Paul, Hastings, Janofksy & Walker to proceed. Investor Ronald Katz hired the law firm to represent him in connection with a $3 million investment in a company called Humitech. In his suit, Mr. Katz claims the lawyers failed to determine that Humitech was not the beneficial owner of certain mineral rights he expected to obtain, and that other collateral in the form of stocks was encumbered. Paul Hastings had moved to dismiss the suit as time-barred, as the investment closed May 21, 2004, more than three years before Mr. Katz filed his suit. But Manhattan Supreme Court Justice Doris Ling-Cohan (See Profile) denied the firm’s motion."

Evidence  before Supreme Court consisted of a bill for services after the closing.  The court determined that there was an open issue [unresolvable on a CPLR 3211 motion] of whether legal services continued.

Jusuf Becovic, et al., Plaintiffs-Respondents-Appellants, v Poisson & Hackett, et al., Defendants-Appellants-Respondents.

3142, 118056/04

SUPREME COURT OF NEW YORK, APPELLATE DIVISION, FIRST DEPARTMENT

2008 NY Slip Op 2644; 2008 N.Y. App. Div. LEXIS 2594

March 20, 2008, Decided
March 20, 2008, Entered

Plaintiffs were physically injured, and the placement and maintenance of a garage sign was an important element of the personal injury case. They lost and sued the attorneys. The legal malpractice case was dismissed on summary judgment. Note the parting comment on discovery.

“In this legal malpractice action, plaintiffs are unable to demonstrate that they would have succeeded in the underlying personal injury action "but for" defendants’ conduct (see AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428, 434, 866 N.E.2d 1033, 834 N.Y.S.2d 705 [2007]). Contrary to the motion court’s conclusion, plaintiffs cannot show that the defendants in the underlying action created the allegedly dangerous condition by an affirmative act of misfeasance (see Mercer v City of New York, 88 NY2d 955, 670 N.E.2d 443, 647 N.Y.S.2d 159 [1996]; Kelly v Berberich, 36 AD3d 475, 476-477, 828 N.Y.S.2d 332 [2007]), [**2] and the claim that said defendants failed to maintain the garage sign that was purportedly the instrumentality that resulted in the injury is not sufficient for this purpose. Plaintiffs also failed to raise an issue of fact regarding notice of the condition, since their sole opposition was hearsay (see Wertheimer v New York Prop. Ins. Underwriting Assn., 85 AD2d 540, 541, 444 N.Y.S.2d 668 [1981]). In view of the dismissal of the instant action, we need not address the arguments on plaintiffs’ cross appeal for spoliation sanctions. We note, however, that plaintiffs’ position is lacking given the long period of inaction [*2] by their attorneys in this action in failing to avail themselves of the opportunity to seek third-party discovery.”

Naida I. Velazquez, etc., appellant, v Bruno Decaudin, et al., defendants, Arnold Streisfeld, etc., et al., respondents. (Index No. 3191/06)

2006-10455, 2007-05614

SUPREME COURT OF NEW YORK, APPELLATE DIVISION, SECOND DEPARTMENT

2008 NY Slip Op 2575; 2008 N.Y. App. Div. LEXIS 2514

March 18, 2008, Decided

As the Appellate Division notes, this is a strange and disturbing real estate deal for the beneficiaries of their mother’s estate.

“The complaint alleges, insofar as is relevant here, that Jose, believing, on the basis of misrepresentations by certain of the defendants, that he was refinancing to save his mother’s property from foreclosure, entered into a contract to convey the property to Decaudin for $ 390,000. The property allegedly was worth $ 600,000 at the time. When the closing was scheduled, Jose [**5] allegedly was advised that only he had to attend the closing, but that he should bring with him his mother’s social security card and driver’s license. At the closing he allegedly was introduced to Streisfeld, and was told that Streisfeld was his attorney.

[*3] The complaint alleges that, prior to the closing, Streisfeld had been provided with a copy of the power of attorney by which Jose was purporting to act in connection with the closing. The power of attorney, which had been executed by Jose’s mother, appointed Jose and his sister, the plaintiff, Naida I. Velazquez, acting jointly, as attorneys-in-fact for their mother. Despite the requirement that Jose and the plaintiff act together, however, the complaint alleges that Jose acted alone in connection with the conveyance of the property and that the plaintiff was unaware of his actions in that regard.

According to the complaint, the closing proceeded only after a lengthy meeting, from which Jose was excluded, between Streisfeld, the representative of the defendant Old Town Abstract Company, LLC (hereinafter Old Town), which was the agent of UGT, and the mortgage brokers, financial advisors, and other attorneys involved in the transaction. [**6] When the closing did proceed, Jose was taken into a room separate from the other participants, where he was advised that he was required to execute a deed, as well as a use and occupancy agreement and an option to purchase agreement. The use and occupancy agreement provided that Jose, who resided elsewhere, could continue to reside in the premises for a period of 12 months as long as he paid Decaudin’s mortgage payments in a timely fashion during that period. The option-to-purchase agreement provided that as long as he did not default in his obligations under the use and occupancy agreement, Jose could purchase the property during that year for $ 370,500, which was the total amount of the two mortgages that Decaudin executed in favor of the defendant Sunset Mortgage Company at the closing.

The complaint further alleges that, at the closing, Jose, Decaudin, Streisfeld, and the attorney for the lender executed an escrow agreement, pursuant to which no funds were to be disbursed, no documents were to be recorded, and no title insurance was to be issued until an original power of attorney in favor of Jose had been delivered to Old Town. The escrow agreement further provided that if the [**7] power of attorney were not delivered, the closing documents were to be returned to the respective parties. The complaint alleges that even though the power of attorney was never delivered to Old Town, the funds were disbursed and the closing documents were not returned, but were recorded, and UGT issued a policy of title insurance. The complaint alleges that the closing documents reflect that Decaudin paid approximately $ 295,000 to satisfy the outstanding mortgage indebtedness on the property and that the remaining $ 95,000 that had been borrowed from Sunset was disbursed to the defendants, rather than to the owner of the property, the plaintiff’s decedent.

Several months later, Jose defaulted in his obligations under the use and occupancy agreement that was executed at closing and DeCaudin initiated a summary dispossess proceeding, in which he was represented by the defendants Ira S. Clair, an attorney, and Clair and Gjertsen (hereinafter collectively Clair). The proceeding resulted in the issuance of a judgment in favor of Decaudin and a warrant of eviction. The complaint alleges that in a motion to vacate the judgment and warrant, Clair was made aware of the alleged defect in Decaudin’s [**8] title but negligently failed to examine the relevant documents or do anything else to ascertain the true state of Decaudin’s title.”