Attorney referrs case to malpractice firm, then after a while, dies.  Widow asks for referral fee on the    $ 875,000  settlement.  Held:  she collects, even when the firm welshes.

Reich v Wolf & Fuhrman, P.C.
2007 NY Slip Op 00623
Decided on January 30, 2007
Appellate Division, Second Department

"In September of 1998, Nelson Cardona retained the defendant law firm, Wolf & Fuhrman (the predecessor to the defendant Wolf & Fuhrman, P.C.), for the purpose of commencing a personal injury action on his behalf. Cardona had been referred to Wolf & Fuhrman by the decedent, Arthur Reich, an attorney who was not associated with Wolf & Fuhrman in any manner. Wolf & Fuhrman, as attorneys of record, subsequently commenced a personal injury action on Cardona’s behalf, which, after four years of litigation, was settled for the sum of $825,000. Thereafter, Phyllis Reich, as the Executrix of the Estate of Arthur Reich, commenced the instant breach of contract action seeking to enforce a fee-sharing agreement that had been entered into between the decedent and Wolf & Fuhrman in November 1998.

The Supreme Court granted the plaintiff’s motion for summary judgment, denied the defendants’ cross motion for summary judgment dismissing the complaint, and awarded the plaintiff the sum of $89,777. A judgment thereafter was entered in accordance with the order. "
he defendants subsequently moved, inter alia, to vacate the order and the judgment on the ground that the Preliminary Letters Testamentary issued to Phyllis Reich as Executrix had expired as of the time the motion and cross motion for summary judgment were made and decided. The Supreme Court denied the motion, finding that the defendants had waived this objection by failing to raise it in opposition to the plaintiff’s motion for summary judgment, and that new Letters Testamentary had since been issued to Phyllis Reich, thereby curing any lapse in her capacity to pursue the action.

In fee-sharing disputes between attorneys, "the courts will not inquire into the precise worth of the services performed by the parties as long as each party actually contributed to the legal work and there is no claim that either refused to contribute more substantially" (Benjamin v Koeppel, 85 NY2d 549, 556). This court has held that such an agreement is enforceable so long as the attorney who seeks his share of the fee "has contributed some work, labor or service toward the earning of the fee" (Witt v Cohen, 192 AD2d 528, 529 [internal quotation marks and citation omitted]; Rozales v Pegalis & Wachsman, 127 AD2d 577, 578). Here, the Supreme Court correctly determined, based upon the evidence presented, that the plaintiff’s decedent contributed some work, labor, or service toward the earning of the fee. Thus, the plaintiff was entitled to the decedent’s share of the fee as allocated in the agreement (see Edelstein v Pirrotti, 286 AD2d 660; Sickmen v Birzon, Szczepanowski & Quinn, 276 AD2d 689).

Contrary to the defendants’ contentions, the Supreme Court properly denied their motion to vacate the order and the judgment on the ground that Phyllis Reich lacked the legal capacity to pursue the litigation

May you sue the opponent’s attorney?  A quick look at the principal of privity says: "No."  Here is a rare circumstance when you may sue the opponent’s attorney.  This particular husband failed; the opening remains, however.

Mars v Grant
2007 NY Slip Op 00576
Decided on January 30, 2007
Appellate Division, First Department

"Plaintiff, who is also the plaintiff in a divorce matter in which his wife is represented by defendants herein, failed to support his pleading of a cause of action under Judiciary Law
§ 487 with allegations that adverse court rulings in the matrimonial action were based on acts of deceit by defendant attorneys (see Melnitzky v Owen, 19 AD3d 201 [2005]), or allegations pleading the required elements of fraud (see Manna Fuel Oil Corp. v Ades, 14 AD3d 666 [2005]), including detrimental reliance (see New York City Tr. Auth. v Morris J. Eisen, P.C., 276 AD2d 78, 86 [2000]). The failure to plead detrimental reliance is also fatal to plaintiff’s cause of action for notary liability under Executive Law § 135 (Rastelli v Gassman, 231 AD2d 507, 508 [1996]), which, in any event, is pleaded in conclusory terms without any specificity. "

Today’s Law Journal Court Notes has a first.  e-mails of adjournment by stipulation are premitted in the Motion Support Part.  Either a stipulation or an affirmation reciting that oral consent to a stipulation was obtained can be sent by e-mail [and attachment] to NYMOTCAL@courts.state.ny.us by 5:00 pm the night before.  See the court note for full details.

Purchase Partners II LLC v. Westreich, 604219/2004
Decided: January 23, 2007

Justice Bernard J. Fried

Here is a case from the NYLJ which denied disqualification:

Third-party defendant Adam Hochfelder moves for an order: (1) quashing a subpoena, pursuant to CPLR 2304 and 3103[1]; and (2) disqualifying the law firm of Kramer Levin Naftalis & Frankel LLP (Kramer Levin) from continuing to represent defendant/third-party plaintiff Anthony Westreich in these actions.

The complaint in the main action alleges that Hochfelder and Westreich together owned a real estate investment company named Max Capital Management Corporation (Max Capital), which owned an interest in a property located at and adjacent to 260 Park Avenue South (260 Park) (see Complaint, ¶¶11-12, 21). Westreich – and certain of his family members through an entity named DTT Park Avenue South LLC (DTT) – allegedly held a share of Max Capital’s interest in 260 Park (see id., ¶22). According to the complaint, plaintiffs are persons and entities who became creditors of Max Capital, Hochfelder and/or Westreich by investing money in, and/or loaning money to, any or all of them (see id., ¶¶15-25).

DR 5-108 (B) provides, in relevant part, that:

Except with the consent of the affected client after full disclosure, a lawyer shall not knowingly represent a person in the same or a substantially related matter in which a firm with which the lawyer formerly was associated had previously represented a client:

(1) Whose interests are materially adverse to that person; and

(2) About whom the lawyer had acquired information protected by [DR 4-101 (B)] that is material to the matter.

Hochfelder has not established that disqualification of Kramer Levin is warranted under DR 5-108 (B) because, as previously stated, he has not established: (a) that he, rather than Belfonti and/or Aligned, was formerly a client of Selver or Paul Hastings; (b) that the matters involved in Selver’s and Paul Hastings’s prior representation of Belfonti and/or Aligned are substantially related to the matters involved in Kramer Levin’s current representation of Westreich; or (c) that the interests of Belfonti and/or Aligned are materially adverse to the interests of Westreich in this action.

Hochfelder has also failed to establish, as required for disqualification under DR 5-108 (B), that Selver, while he was a partner of Paul Hastings, acquired any information which is both "protected by [DR 4-101 (B)]" and "material" to the matter of this litigation. Insofar as Hochfelder may have communicated information to Selver concerning Hochfelder’s own prior relations with Max Capital and/or Westreich, such information might be material to this litigation, but would not be protected by DR 4-101 (B) – which concerns the protection of a client’s confidences and secrets – because Hochfelder has not established that he was a client of Selver’s and/or Paul Hastings’s. Conversely, insofar as Selver, in the course of his representation of Belfonti and/or Aligned, may have obtained information concerning Belfonti and/or Aligned which would be protected by DR 4-101 (B), Hochfelder has not established that any such information would be material to this litigation.

Finally, inasmuch as Hochfelder has failed to establish that Selver himself would be disqualified from representing Westreich in this litigation, if he attempted to do so, there is no basis for imputing such a disqualification to Selver’s current firm, Kramer Levin.

For the foregoing reasons, it is hereby

ORDERED that the branch of third-party defendant Adam Hochfelder’s motion which seeks to disqualify Kramer Levin Naftalis & Frankel LLP from continuing to act as counsel to defendant/third-party plaintiff Anthony Westreich is denied.

Blogs, Web sites, lawyer communications – all are under regulation and potential greater regulation by NYS.  Here is an article about the rules and a case attacking them. 

"A high-volume, heavy-advertising personal injury law firm and a Washington, D.C., advocacy group are apparently the first to challenge the new attorney advertising restrictions that took effect yesterday.

On the same day the new rules were implemented, Alexander & Catalano, with offices in Syracuse and Rochester, and Public Citizen Inc. filed a federal lawsuit in the Northern District alleging the restrictions violate the constitutional right to free speech and impose anti-consumer limits on lawyers’ ads.

The suit, filed yesterday in Albany, seeks injunctive and declaratory relief in an attempt to prevent enforcement of the new rules by the disciplinary committees. (The rules are posted at http://www.courts.state.ny.us/rules/attorney_ads_amendments.shtml). " 

From the blog Judicial Reports, which makes for very amusing reading.  It reports all appellate reversals of New York cases.  Here is one in legal malpractice:

"LEGAL MALPRACTICE: Justice Yvonne Lewis granted summary judgment for Ella Jampolskaya in a legal malpractice suit against Victor Gomelsky and his solo law practice firm. The Appellate Division found too many open questions about the case to allow a judge to jump to conclusions about the outcome. Jampolskaya v Victor Gomelsky, P.C. (January 23).  Here is the full case.

It’s rather shocking to read a legal malpractice action which arises after the U.S. Navy bombs a U.S. citizen, and at work, no less.  In any event, this legal malpractice case  comes about after the U.S. Navy bombed plaintiff, in error!

"Where (1) an employee of the plaintiff company was injured when a U.S. Navy plane errantly dropped two bombs near the employee’s workplace, (2) the injured employee eventually settled with the employer and the employer’s insurance carrier for $305,000, (3) the employee’s subsequent suit against the Navy was dismissed because the complaint erroneously failed to name the United States as a defendant and (4) the employer and its insurance carrier (the plaintiffs) then brought a legal malpractice action against the employee’s attorneys (the defendants), the legal malpractice complaint was correctly dismissed on the ground that the Longshore and Harbor Workers’ Compensation Act does not provide the plaintiffs with "a statutory right to seek damages against an injured employee’s attorneys for legal malpractice in pursuing the employee’s claims against a responsible third party."

The full opinion.

Here is a newspaper article about a case we reported about a week ago.  The story is of a rape victim who lost several rounds of litigation until last week.

Five years and six days ago, a mild-mannered widow with medical problems was raped in a storage unit at Casa Escondida, an Escondido apartment complex that today prides itself on the safety it guarantees older residents.

The attacker, a thin, blond transient who’d reportedly panhandled inside the complex numerous times, vanished.

Last week, the appellate court answered,
In a unanimous opinion written by Justice Cynthia Aaron, Stern received a stern rebuke. The final paragraph of the opinion, though written in legalese, expresses the stark bottom line:

The rape victim “has raised a triable issue of fact as to whether Casa Escondida’s failure to properly maintain its doors and locks was a substantial factor in causing her injury. The trial court thus erred in determining as a matter of law that (she) would not have been able to establish the element of causation in the underlying premises liability action and in granting summary judgment in favor of respondents in the legal malpractice action on that basis.”

So, the ending to this story could be written in front a jury. "

Law Com reports on this attorney in Connecticut:   "A veteran New Haven, Conn., lawyer has been suspended from the practice of law for six months for his role in a real estate transaction that may be a blatant case of mortgage fraud. In his special defense against interim suspension, Olmer noted that, in his 53 years of private practice, his disciplinary history includes only one reprimand in 1990. Olmer has been the defendant in five civil suits charging malpractice since 2004. Two of those were dismissed.

While the degree of culpability among those involved is disputed, there’s no question in state disciplinary officials’ minds that Morris I. Olmer falsely reported the sale price of a West Haven, Conn., property and deserved punishment.

Olmer, a member of the Connecticut Bar since 1953, characterized his handling of the real estate transaction as nothing more than sloppy oversight. He and Chief Disciplinary Counsel Mark A. Dubois’ office agreed to a resolution on Jan. 18 in which Olmer admitted "that he neglected to inform his client, the lender … that the actual sale price of the property … was not the sale price listed on the [Housing and Urban Development] form … ." Olmer also represented the seller and the buyer in the deal, according to his signed agreement to disposition.

Because of the falsely inflated sales price, he walked away from the closing with an additional $79,056 in his pocket, according to Olmer’s financial statements secured by disciplinary counsel. Other parties involved in the closing received their fees based on the $505,000 figure.

The Madison-St. Claire Record prints more aritlcles about law and legal malpractice than almost any publication, including Law.Com  Here is an article about the inner workings of the Class Action litigation world.

"When the Lakin Law Firm filed its newest class action complaint in Madison County Circuit Court Jan. 22, long time co-counsel Paul Weiss of Freed & Weiss in Chicago was noticbly missing from the complaint.

According to attorney Richard Burke, Lakin’s former class action boss who was fired Jan. 4, firm president Brad Lakin also severed ties with Freed & Weiss.

Burke, who filed a breach of contract suit against Lakin and the firm in federal court this week, claims Lakin ordered that all clients be issued letters informing them that they had to choose between representation by the Lakin Firm or the Freed & Weiss firm.

Freed & Weiss is listed as co-counsel on at least 77 class action cases in Madison and St. Clair Counties.

Burke claims Lakin was acting the way he did because he was personally under investigation by the Illinois Bar for accusations of ethical misconduct; he and members of his family had been under investigation by law enforcement authorities; and the Lakin Firm was being excluded from participation by other plaintiffs class counsel in class action litigation pending in other jurisdictions.

He also claims that defendants in class actions were beginning to attack the Lakin firm as adequate class counsel, all as a result of the personal scandals of the Lakin family and Bradley Lakin.

According to Burke, the Lakin Law Firm does not have sufficient experienced and competent staff to prosecute the class actions already filed.

Burke believes the Lakin firm has replaced him with younger, inexperienced attorneys whom may not be able to properly represent the interests of the class.

With his termination and the termination of the Freed & Weiss, Burke claims Lakin removed from the putative class clients almost all of the institutional knowledge related to the representation of these clients solely for his own personal gain.

Burke claims Lakin wanted to terminate his employment with because he knew that he would not allow Lakin to subvert the best interest of the class action clients and the certified classes to the personal interest of Bradley Lakin and the Lakin family.

He claims his firing was done to humiliate him and cause emotional distress to satisfy Lakin’s desire to inflict suffering. "