Long Is. Med. Anesthesiology, P.C. v Rosenberg Fortuna & Laitman, LLP
2021 NY Slip Op 01037 Decided on February 17, 2021 Appellate Division, Second Department is really about a fight between doctors.  Nevertheless, even the oldest profession needs the intervention of younger professions in order to fight.  Here, the lawyers are not responsible for the claimed shortcomings.

“In 1998, the plaintiff Long Island Medical Anesthesiology, P.C. (hereinafter LIMA), which was wholly-owned by the plaintiff Richard Gabay, contracted with Long Island Medical & Gastroenterology Associates, P.C. (hereinafter LIMGA), a medical practice owned by Jay G. Merker, Stewart A. Robbins, and Nathan D. Schulman (hereinafter collectively the LIMGA shareholders), to be the exclusive provider of anesthesiology services for LIMGA (hereinafter the exclusivity agreement). In other actions not presently before this Court, LIMA and Gabay (hereinafter together the plaintiffs) have alleged, inter alia, that the LIMGA shareholders breached the exclusivity agreement.

In the present action, the plaintiffs assert that in May 2014, the LIMGA shareholders engaged the services of the defendant Rosenberg Fortuna & Laitman, LLP, in the persons of the defendants David Rosenberg and Brett Zinner (hereinafter collectively RFL), to facilitate transactions resulting in the replacement of the plaintiffs as the exclusive provider of anesthesiology services for LIMGA and, ultimately, to seize without compensation Gabay’s shares in Day Op of North Nassau, Inc. (hereinafter Day Op). RFL moved pursuant to CPLR 3211(a)(3) and (7) to dismiss the complaint in this action. The plaintiffs opposed the motion, and cross-moved pursuant to CPLR 3211(e) for leave to amend the complaint and pursuant to CPLR 3211(d) for leave to conduct disclosure. The Supreme Court granted RFL’s motion and denied the plaintiffs’ cross motion. The plaintiffs appeal.”

“As the Supreme Court noted, civil conspiracy is not recognized as a civil cause of action in New York (see Notaro v Performance Team, 136 AD3d 997, 999), nor does a violation of the Rules of Professional Responsibility, without more, support either an independent cause of action or a cause of action alleging legal malpractice, even where the alleged violation is a conflict of interest (see Doscher v Meyer, 177 AD3d 697, 699; DeStaso v Condon Resnick, LLP, 90 AD3d 809, 814). In any case, since RFL’s retainer was signed only on behalf of the LIMGA shareholders, not on behalf of any entity in which Gabay or LIMA had a legal interest, RFL did not have a duty to the plaintiffs (see Strujan v Kaufman & Kahn, LLP, 168 AD3d 1114, 1115; Betz v Blatt, 160 AD3d 696, 698), and the alleged conflict of interest did not arise.

To the extent that the first cause of action asserts either tortious interference with contractual relations and/or aiding and abetting tortious interference with contractual relations, both the documentary evidence and the complaint itself defeat this claim. The plaintiffs allege that the LIMGA shareholders’ wrongful acts began in 2009 and culminated in a breach of the exclusivity agreement in March or April of 2014, but the copy of RFL’s retainer, which the plaintiffs themselves submitted, establishes that the LIMGA shareholders did not retain RFL until May 2014. Since RFL had not yet been retained at the time of the LIMGA shareholders’ alleged wrongful acts, RFL could not have participated in or aided and abetted those actions (see Sayles v Ferone, 137 AD3d 486). The same reasoning applies to any claim that RFL aided and abetted fraud (see Betz v Blatt, 160 AD3d at 700; Goel v Ramachandran, 111 AD3d 783, 792). Furthermore, the complaint is not pleaded with the particularity necessary to sustain a cause of action alleging fraud (see CPLR 3016[b]; Nabatkhorian v Nabatkhorian, 127 AD3d 1043, 1044).

To the extent that the plaintiffs claim that RFL aided and abetted conversion, their claim appears to rest on their allegation that the LIMGA shareholders wrongfully terminated the services of LIMA and Gabay at a special meeting of Day Op held on November 5, 2014, and attempted to seize Gabay’s shares in Day Op for no consideration. Although this meeting occurred after RFL was retained, the complaint asserts only that the LIMGA shareholders attempted to seize Gabay’s shares, not that they did so. In any event, since an attorney acting in good faith is not civilly liable for the acts of the client, the plaintiffs’ claim is defeated by their failure to allege any facts that would demonstrate that, to the extent RFL assisted the LIMGA shareholders as alleged, RFL knew or should have known that the LIMGA shareholders’ termination of the services of LIMA and Gabay and attempt to seize Gabay’s shares was wrongful (see Art Capital Group, LLC v Neuhaus, 70 AD3d 605, 606; Mokay v Mokay, 67 AD3d 1210, 1212).

An attorney is liable under Judiciary Law § 487(1) if he or she “[i]s guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party.” “‘A cause of action alleging a violation of Judiciary Law § 487 must be pleaded with specificity'” (Sammy v Haupel, 170 AD3d 1224, 1225, quoting Betz v Blatt, 160 AD3d at 698). “Judiciary Law § 487 focuses on the attorney’s intent to deceive, not the deceit’s success” (Sammy v Haupel, 170 AD3d at 1225 [internal quotation marks omitted]; see Betz v Blatt, 160 AD3d at 699). Here, the Supreme Court correctly determined that, even accepting the plaintiffs’ allegations as true and giving the complaint the benefit of every favorable inference (see Arnell Constr. Corp. v New York City Sch. Constr. Auth., 177 AD3d 595, 596), the plaintiffs failed to plead this cause of action with sufficient particularity to withstand a motion to dismiss.”

Defendants made an offer to settle the case.  Plaintiff’s attorneys did not communicate the offer to Plaintiff.  Plaintiff never got the chance to consider it.  Summary judgment granted shortly thereafter.  Problem for the attorneys?  Not in Drasche v Edelman & Edelman, P.C.  2021 NY Slip Op 30429(U) February 12, 2021 Supreme Court, New York County Docket Number: 153713/2020 Judge: David Benjamin Cohen.

“On or about December 21, 2015, plaintiff was injured at 2323 Broadway in Manhattan, which premises were owned or leased by Banana  Republic, LLC (“Banana Republic”) and/or The Gap. Doc. 1 at par. 6. Plaintiff thereafter retained the firm to undertake an investigation of
the incident and to commence an action on her behalf against Banana Republic and/or The Gap. Id.”

” On or about February 11, 2016, the firm commenced an action on plaintiff’s behalf as against Banana Republic and The Gap (“the underlying action”). Doc. 1 at par. 10; Doc. 7. Plaintiff was deposed in the underlying action on December 13, 2016, during which proceeding
she was represented by Engle. Id. at par. 12. Following plaintiff’s deposition in the underlying action, defendants allegedly made a settlement offer to Engle, who in tum advised Edelman, an
“owner or shareholder” of the firm, about the offer. Id. at 7, 14. However, defendants did not advise plaintiff that a settlement offer had been made.”

“Banana Republic and The Gap thereafter moved for summary judgment in the underlying action. Id. at par. 17. By order dated July 6, 2018, this Court (Edmead, J.) granted the motion and the complaint was dismissed. Id. at pars. 17-18; Doc. 9. By order dated May 9, 2019, the Appellate Division, First Department affirmed Justice Edmead’s order of dismissal.”

” Although plaintiff does not specifically allege that defendants “failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession” (see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 442), she does allege that defendants were “negligent and [departed] from acceptable practice for attorneys engaged in the practice oflaw in the State of New York.” Doc. 1 at par. 20. Viewing this claim in a light most favorable to plaintiff, this Court finds that it adequately sets forth the standard of care from which defendants allegedly deviated. However, plaintiff fails to allege that she would not have sustained damages “but for” the
defendants’ alleged negligence (see Rudolfv Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 442). As noted above, plaintiff claims that the defendants’ failure to advise her about the settlement offer “deprived [her] of the opportunity to settle her lawsuit and thereby obtain a monetary recovery for her injuries, pain and suffering, and medical bills.” Id. at par. 20 (emphasis added). However, she does not claim that she would have accepted the settlement offer had she
known about it. Thus, her legal malpractice claim must be dismissed (see Magnacoustics, Inc. v Ostrolenk, Faber, Gerb & Soffen, 303 AD2d 561, 562 [2d Dept 2003] [legal malpractice claim dismissed where plaintiffs failed to demonstrate that, but for defendants’ alleged negligence in failing to advise them that a settlement offer had been made, they would have accepted the offer and would not have sustained any damages]; Cannistra v O’Connor, McGuinness, Conte, Doyle, Oleson & Collins, 286 AD2d 314, 315-316 [2d Dept 2001] [plaintiffs failed to establish that, but for defendants’ alleged negligence in failing to advise them of a deadline for accepting a settlement offer, they would have accepted it]). Moreover, since “mere speculation of a loss resulting from an attorney’s alleged omissions … is insufficient to sustain a claim” for legal malpractice” (Gallet,
Dreyer & Berkey, LLP v Basile, 141AD3d405, 405-406 [1st Dept 2016] [internal quotation marks omitted]), plaintiffs claim that she may have accepted a settlement offer had she known about it must fail for this reason as well. “

Successful claims under Judiciary Law 487 are rare.  In recent years they have been applied widely and with diminishing success.  Here, the claim is essentially that the corporation’s attorneys defended a law suit and in doing so engaged in deceit.  In Dial Car Inc. v Tuch & Cohen, LLP  2021 NY Slip Op 30407(U) February 10, 2021 Supreme Court, Kings County
Docket Number: 514138/20 Judge: Leon Ruchelsman the court dismissed.

“The plaintiff is a black car livery service catering to high end clients in Brooklyn. In 2015 Yakov Guzman initiated a shareholder derivative action against Michael Kordonsky and Jeffrey Goldberg, members of the corporation on the grounds they wasted corporate assets. The defendants represented Dial in that proceeding. The complaint alleges the defendants, who should have championed the allegations of Guzman instead acted in ways which benefitted Kordonsky and Goldberg to the detriment of Dial. Specifically, the defendants agreed with a motion to dismiss that was filed by Kordonsky and Goldberg. Further, the defendants unsuccessfully opposed Guzman’s motion to replead the complaint and a further motion to dismiss the amended complaint.
Further, the complaint alleges the defendants negotiated retirement payments to Goldberg in violation of the By-Laws which require a shareholder vote. Moreover, the complaint alleges the defendants negotiated a general release in favor of Goldberg following the service of the Guzman complaint in violation of the By-Laws. ”

“Concerning Judiciary Law §487, it is well settled that to establish such a cause of action the plaintiff must present evidence an attorney acted “with intent to deceive” either the court or any party (see, Moormann v. Perini Hoerger, 65 AD3d 1106, 886 NYS2d 49 [2d Dept., 2009]). The allegations concerning the deception must be pled with particularity (Betz v. Blatt, 160 AD3d 696, 74 NYS3d 75 [2d Dept., 2018]). Moreover, the cause of action is only applicable if the conduct alleges took place in a proceeding where the plaintiff was a party (Barouh v. Law offices
of Jason L. Abelove, 131 AD3d 988, 17 NYS3d 144 [2d Dept., 2015]). First, it must be noted that the Second Department no longer maintains a cause of action pursuant to Judiciary Law §487
based upon an attorney’s egregious, extreme or chronic delinquent
activities. Rather, “the only liability standard recognized in
Judiciary Law §487 is that of an intent to deceive” (Dupree v.
Vorhees, 102 AD3d 912, 959 NYS2d 235 [2d Dept., 2013]). Second,
considering the intent to deceive, such intent can hardly be
demonstrated. The complaint merely alleges in conclusory fashion
that the defendants “have continuously consented to deceit or
collusion, with the intent to deceive and harm Dial” (see, Complaint, ¶157) without elaborating upon those allegations. The mere pursuant of the dismissal of the Guzman lawsuit can hardly be considered an intent to deceive the plaintiff. Further, since that is the only conduct alleged wherein Dial was a party in a pending action all of the other allegations of the complaint cannot sustain a cause of action in this regard.”

People v Austin  2021 NY Slip Op 30276(U) January 29, 2021 Supreme Court, New York County Docket Number: 451533/2019
Judge: O. Peter Sherwood is the unusual government case in which a legal malpractice issue is inserted.  Here one defendant cross-claims against another defendant for legal malpractice.

“In 2014. the Attorney General’s office (‘”AG”) began an investigation of the Lutheran All Faiths Cemetery (the “Cemetery”). As a result of the investigation, the AG commenced this
action seeking remedial and injunctive relief against the member of Cemetery’s Board of Directors for breach of fiduciary duty to the Cemetery (Nunberg Aff. ii 5 [Doc. No. 106]). Mordente is a director of the Cemetery and his law fim1, Mordentr Law Firm LI .C, has
been General Counsel to the Cemcte1y since 1990 (id. ir 6). Defendant Lodato joined the Cemetery’s Board in 2004 (id. ii 8). In an Amended Answer, Lodato also alleged cross-claims
against Mordente sounding in legal malpractice. contribution, and subrogation (Mordente Aff.  6 [Doc. No. 107]). He alleges that Mordente committed legal malpractice arising from his role in drafting defendant Daniel Austin, Sr.’s (“Austin, Sr.”) employment contract with the Ccmete1y, distributing assets of a Non-Qualified Deferred Compensation Fund (the “Rabbi Trust”), and
understating the Cemetery’s contribution to the Rabbi Trust (id if 19: Amended Answer 19 Doc. No.  109). Mordente responds that he has never been retained, performed work for, or represented Lodato in an individual capacity or in his capacity as a director of the Cemetery (Mordente Aff iii! 8-12). Defendant Lodato did not submit opposition to this motion.”

“Lodato’ s legal malpractice claim against Mordente must be dismissed. First, an attoney client relationship did not exist between Mordente and Lodato. The only retainer agreement on
record here is one between Mordent’s law firm and the Cemetery. That agreement makes clear that the only client taken on was the Cemetery itself (Mordente Aff., Ex. C at 1 ). Further, New York courts have held that a corporation’s attorney represents only the corporate entity, not its officers or directors (Campbell v McKeon, 75 AD3d 479, 480-481 [1st Dept 20 I OJ). Lodato, having failed to oppose Mordent’s motion, also fails to provide any evidence that an attoney client relationship existed between him and the Mordente firm. Lodato’s Amended Answer alleges that Mordente represented the Lodato family in connection with a mortgage transaction
between the family and the Cemetery (Amended Answer,, 4-7). Mordente rebuts these allegations, demonstrating that the Closing Statement and Closing Attendance Sheets for the mortgage transaction list Vincent Lodato as having his own counsel whereas the Mordente firm represented the Cemetery (Mordente Aff., Exs. G, H [Doc. Nos. 114~115]). Lodato also cannot establish a “near privity” relationship with the Mordente firm as his Answer merely pleads such a relationship exists without offering any specific examples of Lodato ‘s reliance on Mordente’s conduct or statements. Moreover, Mordente has met his burden under CPLR 321 l(a)(5) to show
that the time in which to sue has expired (see [<;/and ADC. Inc. v Baldassano ArchitecturalGroup. P. C. 49 AD3d 815, 816 f2008]). Consequently, the cross-claim for legal malpractice against Mordente must be dismissed for failure to state a claim and for failure to assert the claim within the applicable statute of limitations. “

Volpe v Munoz & Assoc., LLC  2021 NY Slip Op 00516 Decided on January 28, 2021 Appellate Division, First Department gives a bullet point review of how this case failed:

“The complaint fails to state a cause of action for legal malpractice. First, it does not allege an attorney-client relationship between the attorneys and plaintiff. Although there was no written retainer agreement, the parties’ conduct makes clear that the attorneys performed services solely for the LLC that was formed by plaintiff and defendant Joseph Cohen (see Wei Cheng Chang v Pi, 288 AD2d 378 [2d Dept 2001], lv denied 99 NY2d 501 [2001]).

The complaint also fails to state a derivative malpractice claim because it does not allege that an attorney-client relationship existed between the attorneys and the LLC at the relevant time. Under the terms of the LLC’s operating agreement, the LLC dissolved upon the expiration of its consulting agreement with nonparty Brielle, Inc., on April 30, 2018. Thus, there was no client to which the attorneys could owe a duty in October 2018, when they represented Cohen and his new business entity.

Second, plaintiffs’ allegations of legal malpractice consist solely of claimed violations of the Rules of Professional Conduct, which do not alone support a malpractice claim (Shapiro v McNeill, 92 NY2d 91, 97 [1998]).

Third, whether plaintiff would have obtained further business from Brielle was entirely within Brielle’s discretion, thus any causational link between the alleged malpractice and plaintiff’s alleged loss is wholly speculative (see Bua v Purcell & Ingrao, P.C., 99 AD3d 843, 848 [2d Dept 2012], lv denied 20 NY3d 857 [2013]).

The complaint also fails to state a cause of action for aiding and abetting breach of fiduciary duty, because plaintiffs fail to allege that the attorneys did anything more than prepare legal agreements for Cohen (Art Capital Group, LLC v Neuhaus, 70 AD3d 605 [1st Dept 2010]).”

The claim in Berkovits v Berkovits  2021 NY Slip Op 00406 Decided on January 27, 2021Appellate Division, Second Department is not matrimonial, it is patriarchal.  Father alleges that son defrauded him over valuable assets.  For our purposes, there is also a claim against his attorneys for not explaining the deal.

“The plaintiff Joseph Berkovits alleges that his son, the defendant Mayer Berkovits, improperly induced him to execute an agreement creating an irrevocable trust (hereinafter the trust). Joseph Berkovits alleges that Mayer Berkovits falsely advised him to sign documents purportedly related to the tax treatment of certain real property, and that those documents actually established the trust. Pursuant to the trust agreement, Joseph Berkovits, as grantor, transferred to the trust certain shares in the plaintiff Aberko Realty, Inc. (hereinafter Aberko; hereinafter together with Joseph Berkovits, the plaintiffs). The trust agreement provided, inter alia, that Mayer Berkovits was to serve as investment advisor, distribution advisor, and protector of the trust. In those capacities, Mayer Berkovits allegedly was granted sole authority to manage the trust and its assets, including the sole discretion to make any distributions.

According to the plaintiffs, the defendant Roberts & Holland, LLP, and the defendant David Mark Rozen, a partner in that firm (hereinafter together the attorney defendants), represented both Joseph Berkovits and Aberko in connection with the creation of the trust. The plaintiffs allege that the attorney defendants failed to explain to Joseph Berkovits the terms of the trust agreement. The plaintiffs allege that the attorney defendants improperly represented and promoted the interests of Mayer Berkovits in that transaction, and failed to seek or obtain a waiver of any conflict of interest.”

“Contrary to the contention of the attorney defendants, the fourth cause of action states a viable legal malpractice cause of action. “In an action to recover damages for legal malpractice, a plaintiff must demonstrate that the attorney ‘failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession’ and that the attorney’s breach of this duty proximately caused plaintiff to sustain actual and ascertainable damages” (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442, quoting McCoy v Feinman, 99 NY2d 295, 301; see Iannucci v Kucker & Bruh, LLP, 161 AD3d 959, 960). The “binding nature of [an] agreement between [a client] and a third party is not a complete defense to the professional malpractice of [a] law firm that generated the agreement to its client’s detriment” (Arnav Indus., Inc. Retirement Trust v Brown, Raysman, Millstein, Felder & Steiner, 96 NY2d 300, 305; see Bishop v Maurer, 9 NY3d 910, 911).

The complaint alleges that the attorney defendants committed malpractice by failing to provide adequate legal advice to their client, Joseph Berkovits, prior to his execution of the trust agreement, and in failing to explain or seek any waiver of a potential conflict of interest created by their alleged simultaneous representation of Joseph Berkovits, Mayer Berkovits, and Aberko. The complaint also alleges that such conduct proximately caused damages to both Joseph Berkovits and Aberko. Under these circumstances, the complaint states a valid legal malpractice cause of action (see Arnav Indus., Inc. Retirement Trust v Brown, Raysman, Millstein, Felder & Steiner, 96 NY3d at 304-305; see also Kram Knarf, LLC v Djonovic, 74 AD3d 628, 628; Tabner v Drake, 9 AD3d 606, 610).”

Pace v Horowitz  2021 NY Slip Op 00392 Decided on January 26, 2021
Appellate Division, First Department illustrates the power of the “date of mistake” statute of limitations in legal malpractice.  Despite the problem that many mistakes do not surface for a long time, Courts rigorously apply the statute of limitations and are parsimonious in allowing continuous representation.

“The court correctly determined that plaintiffs failed to show that there is an issue of fact as to whether the legal malpractice claim was timely filed based on the application of the continuous representation doctrine toll (see Marzario v Snitow Kanfer Holzer & Millus, LLP, 178 AD3d 527, 528 [1st Dept 2019]). The continuous representation doctrine toll does not apply based merely on the existence of an ongoing professional relationship, but only where the particular course of representation giving rise to the particular problems resulting in the alleged malpractice is ongoing (see Matter of Lawrence, 24 NY3d 320, 341 [2014]; Williamson v PricewaterhouseCoopers LLP, 9 NY3d 1 [2007]). Here, while plaintiffs allege that defendant law firm provided continuing estate administration work as part of an ongoing professional relationship of estate administration, they do not adequately allege that the particular course of representation regarding the sale of estate assets in 2007, which gave rise to the malpractice allegations, continued through February 2015, so as to make the instant malpractice claim timely filed.”

Pre-Answer Dismissal of complaints is given outsized importance in legal malpractice litigation.  Anecdotally, a higher percentage of legal malpractice cases are dismissed pre-answer than those in the general population of litigation cases.  Zeppieri v Vinson 2021 NY Slip Op 00348
Decided on January 21, 2021 Appellate Division, Third Department describes how 3211(a)(1) is used.

“”A motion pursuant to CPLR 3211 (a) (1) to dismiss the complaint as barred by documentary evidence may be properly granted only if the documentary evidence utterly refutes the plaintiff’s factual allegations, conclusively establishing a defense as a matter of law. To qualify as documentary evidence, the evidence must be unambiguous and of undisputed authenticity” (Koziatek v SJB Dev. Inc., 172 AD3d 1486, 1486 [2019] [internal quotation marks and citations omitted]). “[I]t is clear that judicial records, as well as . . . any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case” (Jenkins v Jenkins, 145 AD3d 1231, 1234 [2016] [internal quotation marks and citations omitted]; see Magee-Boyle v Reliastar Life Ins. Co. of N.Y., 173 AD3d 1157, 1159 [2019] [internal quotation marks, brackets and citation omitted]).^[FN1]

In support of their motion, defendants submitted the July 2018 order, the transcript of the bench trial and an email that had been accepted into evidence. The July 2018 order clearly qualifies as documentary evidence. As Supreme Court observed, the July 2018 order “refutes plaintiffs’ primary contention that defendants’ failure to object to Flacke’s testimony was the proximate cause of plaintiffs’ damages.” Where Supreme Court specifically states that its order is based on the decision from the underlying action, we find ourselves with “the proper case” in which a judicial record qualifies as appropriate documentary evidence sufficient to defeat the action (Jenkins v Jenkins, 145 AD3d at 1234). Moreover, even if the court also relied on the underlying transcript, contrary to plaintiff’s contention, there is no per se prohibition on said reliance, where, as here, the contents of the transcript are undeniable (see Tyree v Castrovinci, 164 AD3d 1399, 1400 [2018]). We agree that Supreme Court properly granted defendants’ motion to dismiss the amended complaint based upon documentary evidence (see Ganje v Yusuf, 133 AD3d 954, 957 [2015]; Doller v Prescott, 167 AD3d 1298, 1300 [2018]). Given our finding, the remainder of plaintiffs’ arguments are academic.”