Bridge View Tower, LLC v Law Offs. of Boris Nikhman, Esq. & Vladimir Nikhman, Esq.  2019 NY Slip Op 51425(U) Decided on September 4, 2019
Civil Court Of The City Of New York, New York County Kraus, J.  is emblematic of what most defense attorneys think any legal malpractice case looks like…no focus, no proof, and merely an exercise in choler by a dissatisfied client.

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The record at trial was scant and the facts were not clearly laid out. BVT did not offer a single document in evidence.

Michael Tong (Tong) testified for the BVT. Tong is a member of the BVT LLC. Tong testified that he was developing a property in Brooklyn and discovered some fraud on the part of the Condominium Board and brought suit on that basis. In October of 2016, BVT signed a retainer agreement with Defendants wherein Defendants agreed to represent BVT in Action 1.

Tong later became dissatisfied with Defendants’ services and fired Defendants. Tong did not state the date he fired Defendants. Tong testified that he hired a new attorney Martin Kohn to represent him. Tong testified he subsequently learned his action had been dismissed and that Martin Kohn refunded his retainer agreement.

Tong testified that he believed when he hired Defendants that a foreclosure action would subsequently be brought against him and he believed Defendants would represent him when that action was brought.

Tong testified that the foreclosure action was going to be consolidated or was consolidated with his case against the Condo Board, however there was no evidence of this submitted at trial or referenced in the court filings reviewed. Tong testified that Action 1 was dismissed because of some unspecified default on the part of Defendants. Tong testified that he lost the foreclosure action and that he blamed Defendants for said loss. Tong did not testify to any alleged damages incurred as a result of his action against the Board being dismissed, but he did testify that as a result of losing the foreclosure action he suffered damages of approximately $71,000 in the form of additional fees and penalties he was required to pay.

Tong testified that BVT recommenced his action against the Condo Board and that action was still pending as of the date of this trial. Tong alleges that he was adversely impacted by the dismissal Action 1 because it was not consolidated with the trial of the foreclosure action against him.

After Tong’s testimony, BVT rested and Defendants moved to dismiss. The court reserved decision on the motion.

Defendants then proceeded on their counterclaims. Vladimir Nikhman (VN) testified on behalf of Defendants. VN testified that Tong hired him in October 2015 to represent BVT in Action 1, and specifically to file an order to show cause. VN testified that he and Tong were friends and used to play poker together.

The parties signed a retainer agreement which was admitted in evidence (Ex A). BVT paid Defendants a $5000 retainer which was to be drawn down at the rate of $300 an hour for work done on Action 1. There was no provision in the retainer agreement for any billing beyond the initial $5000 retainer.

Initially, VN testified that he sent Defendants invoices every 60 days, but he produced no [*3]such invoices. VN then testified that he does not recall how often he sent Defendants invoices. VN testified that gave a document labeled “Time Sheet” to Tong as an invoice when he would come into the office. VN provided no detailed testimony about the nature of the work he did or the time he spent, or even his background and experience. VN did submit an invoice/time sheet (Ex C) however the court gives no weight to this document which is dated May 10, 2018, years after VN acknowledges he had been fired and well after the commencement of this action.

VN testified that his relationship with Tong deteriorated because Tong called him and emailed him incessantly and at inappropriate hours. VN acknowledged that Tong fired him and said that he only represented BVT for a period of three to four months.

VN testified that he and Tong had reached an agreement to do work beyond the amount of the initial $5000 retainer and that Tong gave him a check for an additional $2500.00 (Ex B). The check is marked for “Retainer” . The check was dated February 19, 2016. VN testified that at Tong’s request he delayed depositing the check. Presumably shortly after receiving the check Defendants were fired. VN attempted to deposit the check on or about March 2, 2016 but Tong had put in a stop payment on the check.”

“BVT Failed to Establish a Prima Facie Case Against Defendants for Legal Malpractice

To establish a cause of action for legal malpractice, BVT must prove that Defendants were negligent, that such negligence was the proximate cause of actual damages sustained by BVT, and that but for Defendants’ negligence, BVT would have been successful in the underlying action (Cummings v Donovan 36 AD3d 648). Speculative damages or conclusory claims are not sufficient to meet this standard ( Pellegrino v File 291 AD2d 60).

A claim for legal malpractice should be supported by expert testimony at trial (Merlin Biomed Asset Mgmt., LLC v. Wolf Block Schorr & Solis-Cohen LLP, 23 AD3d 243).

BVT’s evidence at trial fell far short of this standard.

Based on the foregoing, BVT’s action is dismissed.”

Lopez v Lozner & Mastropietro, P.C.  2018 NY Slip Op 08017 [166 AD3d 871] November 21, 2018 Appellate Division, Second Department  is an example of how some judges just get it wrong in legal malpractice settings, and dismiss where there is an actual cause of action stated.

“On November 4, 2011, the plaintiff, a pedestrian, allegedly was injured when he was struck by a motor vehicle. Thereafter, the plaintiff retained the defendant law firm, Lozner & Mastropietro, P.C. (hereinafter the law firm), to represent him in connection with the accident, and the law firm commenced an action on behalf of the plaintiff against the operator of the vehicle. In January 2017, the plaintiff commenced this action against the law firm and two of its principals, inter alia, to recover damages for legal malpractice. The plaintiff alleged that the driver of the offending vehicle was working for Domino’s Pizza, LLC (hereinafter Domino’s), making a pizza delivery at the time of the subject accident, and that the defendants were negligent in failing to timely commence an action against Dominos. The defendants moved pursuant to CPLR 3211 (a) to dismiss the complaint. In the order appealed from, the Supreme Court, inter alia, granted that branch of the defendants’ motion which was pursuant to CPLR 3211 (a) (7) to dismiss the first cause of action to recover damages for legal malpractice.

“On a motion pursuant to CPLR 3211 (a) (7) to dismiss for failure to state a cause of action, the court must accept the facts alleged in the complaint as true, accord the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” (Shah v Exxis, Inc., 138 AD3d 970, 971 [2016]; see Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; Leon v Martinez, 84 NY2d 83, 87-88 [1994]). “Where a court considers evidentiary material in determining a motion to dismiss a complaint pursuant to CPLR 3211 (a) (7), but does not convert the motion into one for summary judgment, the criterion becomes whether the plaintiff has a cause of action, not whether the plaintiff has stated one, and unless the movant shows that a material fact as claimed by the plaintiff is not a fact at all and no significant dispute exists [*2]regarding the alleged fact, the complaint shall not be dismissed” (Bodden v Kean, 86 AD3d 524, 526 [2011]; see Guggenheimer v Ginzburg, 43 NY2d 268, 275 [1977]). “Whether the complaint will later survive a motion for summary judgment, or whether the plaintiff will ultimately be able to prove its claims, of course, plays no part in the determination of a prediscovery CPLR 3211 motion to dismiss” (Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34, 38 [2006]; see EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11, 19 [2005]; Tooma v Grossbarth, 121 AD3d 1093, 1095 [2014]).

“To state a cause of action to recover damages for legal malpractice, a plaintiff must allege: (1) that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession; and (2) that the attorney’s breach of the duty proximately caused the plaintiff actual and ascertainable damages” (Dempster v Liotti, 86 AD3d 169, 176 [2011] [internal quotation marks omitted]; see Leder v Spiegel, 9 NY3d 836, 837 [2007]). Here, accepting the facts alleged in the complaint as true, and according the plaintiff the benefit of every possible favorable inference, the plaintiff stated a cause of action to recover damages for legal malpractice (see Tooma v Grossbarth, 121 AD3d at 1095-1096; Endless Ocean, LLC v Twomey, Latham, Shea, Kelley, Dubin & Quartararo, 113 AD3d 587, 589 [2014]; Reynolds v Picciano, 29 AD2d 1012, 1012 [1968]). The evidentiary submissions did not establish that a material fact alleged in the complaint is not a fact at all and that no significant dispute exists regarding it (see Bodden v Kean, 86 AD3d at 526). Contrary to the defendants’ contention, the plaintiff was entitled to commence this legal malpractice action even though the underlying personal injury action was still pending, as the legal malpractice action accrued, at the latest, in November 2014 (see Johnston v Raskin, 193 AD2d 786, 787 [1993]).”

As is almost always true, plaintiffs are unsuccessful at a summary judgment motion in legal malpractice settings.  The Court can almost always find questions of fact which still remain in the “but for” area  even after a departure from good practice is poundingly demonstrated.

Eurotech Constr. Corp. v Fischetti & Pesce, LLP  2019 NY Slip Op 01366 [169 AD3d 597] February 26, 2019Appellate Division, First Department shows how the “but for” analysis goes.

“Plaintiff failed to establish that there are no issues of fact as to its legal malpractice claim. The claim is that defendant failed to timely communicate with plaintiff about information obtained from testimony or bills of particular in the underlying personal injury action, and that, as a result, plaintiff was unable to timely notify its excess insurance provider that its primary insurance coverage might be exhausted. Still unresolved are the type and timing of any communication required, which depends on the agreed-upon scope of defendant’s representation of plaintiff, and the point at which defendant, in the exercise of the requisite professional skill and knowledge, should have realized that plaintiff’s primary insurance coverage could be exhausted (see Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34, 41-42 [2d Dept 2006], cited in Eurotech Constr. Corp., 155 AD3d at 437). Expert testimony would have been helpful because the issues here involve professional standards beyond the ordinary experience of non-lawyers (see Tran Han Ho v Brackley, 69 AD3d 533, 534 [1st Dept 2010], lv denied 15 NY3d 707 [2010]).”

We’ve not heard the phrase before, but are familiar with the situation.  Plaintiff gets into financial trouble and looks to fix a mortgage with a modification, a refinance, or some other method.  Things go bad from there.  Ramirez v Donado Law Firm, P.C.  2019 NY Slip Op 01244 [169 AD3d 940] February 20, 2019 Appellate Division, Second Department is an example.

“The plaintiffs allegedly were the victims of a foreclosure rescue scam perpetrated by the defendants Donado Law Firm, P.C. (hereinafter Donado Law), Valmiro Donado, and Roberto Pagan-Lopez (hereinafter collectively the defendants), among others. The plaintiffs commenced this action alleging, inter alia, violations of Real Property Law § 265-b and General Business Law § 349, as well as fraud, fraudulent inducement, fraudulent misrepresentation, breach of contract, and legal malpractice. The defendants moved pursuant to CPLR 3211 (a) (7) to dismiss the complaint insofar as asserted against them. The Supreme Court, inter alia, denied the motion, and the defendants appeal.”

“To recover damages for legal malpractice, a plaintiff must establish “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” (Dombrowski v Bulson, 19 NY3d 347, 350 [2012] [internal quotation marks omitted]; see Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]; Dempster v Liotti, 86 AD3d 169, 176 [2011]). “To establish causation, a plaintiff must show that he or she would have prevailed in the underlying action or would not have incurred any damages, but for the lawyer’s negligence” (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 442; see Garcia v Polsky, Shouldice & Rosen, P.C., 161 AD3d 828, 830 [2018]; Kliger-Weiss Infosystems, Inc. v Ruskin Moscou Faltischek, P.C., 159 AD3d 683, 684 [2018]). Here, contrary to the defendants’ contention, the complaint sufficiently pleaded a cause of action to recover damages for legal malpractice (see Garcia v Polsky, Shouldice & Rosen, P.C., 161 AD3d at 830; Hershco v Gordon & Gordon, 155 AD3d 1007, 1009 [2017]). Accordingly, we agree with the Supreme Court’s denial of that branch of the defendants’ motion which was pursuant to CPLR 3211 (a) (7) to dismiss the cause of action sounding in legal malpractice insofar as asserted against them.”

Strujan v Kaufman & Kahn, LLP 2019 NY Slip Op 00630 [168 AD3d 1114] January 30, 2019 Appellate Division, Second Department is the end of the line for this case, and going forward Plaintiff must ask permission to file papers.

“Since the defendants represented the plaintiff’s adversaries in a prior action, the causes of action alleging legal malpractice and negligence are unsupported by any duty running from the defendants to the plaintiff (see Betz v Blatt, 160 AD3d 696, 698 [2018]; Betz v Blatt, 116 AD3d 813, 815 [2014]; Gorbatov v Tsirelman, 155 AD3d 836, 840 [2017]; DeMartino v Golden, 150 AD3d 1200, 1201 [2017]; Pasternack v Laboratory Corp. of Am. Holdings, 27 NY3d 817, 825 [2016]).

The plaintiff’s allegations of “intentional harm,” which the Supreme Court properly interpreted as stating a cause of action alleging prima facie tort, were unsupported by facts demonstrating that the defendants acted with “malicious intent or disinterested malevolence” in the prior action (Ahmed Elkoulily, M.D., P.C. v New York State Catholic Healthplan, Inc., 153 AD3d 768, 772 [2017]; see Dorce v Gluck, 140 AD3d 1111, 1112 [2016]; Wiggins & Kopko, LLP v Masson, 116 AD3d 1130, 1131 [2014]; Smallwood v Lupoli, 107 AD3d 782, 785 [2013]; Lisi v Kanca, 105 AD3d 714 [2013]; Shields v Carbone, 78 AD3d 1440, 1442-1443 [2010]). Likewise, the allegations of defamation failed to state a cause of action. The law provides absolute immunity from liability for defamation based on oral or written statements made by attorneys in connection with a proceeding before a court “ ’when such words and writings are material and pertinent to the questions involved’ ” (Front, Inc. v Khalil, 24 NY3d 713, 718 [2015], quoting Youmans v Smith, 153 NY 214, 219 [1897]; see Weinstock v Sanders, 144 AD3d 1019, 1020 [2016]; see also Stega v New York Downtown Hosp., 31 NY3d 661 [2018]).

The plaintiff’s remaining causes of action are not recognized in New York or are inadequately pleaded (see Chanko v American Broadcasting Cos. Inc., 27 NY3d 46, 56 [2016]; Scialdone v Stepping Stones Assoc., L.P., 148 AD3d 953, 954-955 [2017]; Klein v Metropolitan Child Servs., Inc., 100 AD3d 708, 711 [2012]; 42 USC § 1983; CPLR art 14-A).”

Serrone v Southbridge Towers, Inc.  2019 NY Slip Op 32472(U)  August 20, 2019 Supreme Court, New York County Docket Number: 653567/2018
Judge: Francis A. Kahn III is the story of a foreclosure in what was once a Mitchel-Lama building.  Plaintiff succeeds on this motion in keeping the attorneys in the case.

“This is an action concerning the purported wrongful sale of a  2 cooperative apartment. Plaintiff Pasquale Serrone contends that despite his eviction from co-operative unit 4A located at 100 Beekman Street in Manhattan in 2015, his ownership interest in the Cooperative Company
Defendant Southbridge Towers, Inc., (“Southbridge”) remains. Plaintiff argues his ownership of his shares in Southbridge was not properly terminated before the unit was sold in 2018 to Defendants Frank and Monica Chung (“Chungs”) and that he is entitled to damages constituting the revenue from the sale plus interest. Plaintiff has not pled a cause of action seeking restoration of his ownership interest in the shares sold to the Chungs. ”

“However, Plaintiff properly pled a negligence claim against NMM and Roberts. Generally, claims of professional malpractice against an attorney are barred against those not in privity (see Good Old Days Tavern, Inc., v Zwirn, 259 AD2d 300 [1st Dept 1999]). An exception
exists and liability may be extended where a plaintiff sufficiently pleads acts of fraud, collusion, malicious acts or other special circumstances (see Leggiadro, Ltd. v Winston & Strawn, 119 AD3d 442 [Pt Dept 2014]).
Here, Plaintiff pled Southbridge did not own the shares the time of the disputed sale and NMM and Roberts acknowledge, they corresponded with Plaintiff by letters dated November 14, 2017 and November 29, 2017 regarding Plaintiffs equity in the subject apartment. The
surrender agreement that NMM and Roberts sought Plaintiff to sign, that accompanied the second correspondence, sought to extinguish “any remaining rights” Plaintiff had to the apartment. Despite Plaintiff not executing said surrender agreement NMM and Roberts
represented Southbridge in the March 1, 2018 closing for this apartment.

It is inescapable that NMM and Roberts were aware that Southbridge’ s ownership interest in the co-op shares was potentially fatally flawed and that Plaintiff may have retained an ownership interest. Yet, NMM and Roberts facilitated the consummation of the closing. These
actions sufficiently state a claim of collusion, malicious acts or special circumstances for pleading purposes (see A & M Bldg. & Condo Maintenance, Inc. v Atlas Elec. of Staten Is., Inc., 294 AD2d 520 [2d Dept 2002] [Claim against defendant’s law firm and lawyer sufficiently
pleaded where it was alleged firm committed fraud by submitting order discharging lien without indicating its conditional nature and without satisfying condition]; Green v Fischbein Olivieri Rozenholc & Badillo, 119 AD2d 345 [Pt Dept 1986] [Attorney’s liability to third-party premised
on commencing and prosecuting eviction proceedings without legal basis sufficiently pled fraud, collusion, malicious or tortious act]; see also Hahn v Wylie, 54 AD2d 629 [1st Dept 1976]; New York Cooling Towers, Inc. v Goidel, 10 Misc 3d 219 [Sup Ct, Queens Cty 2005]).
With respect to the proffered documentary evidence, NMM and Roberts argue it demonstrates Southbridge participated in the Mitchell-Lama Program and Plaintiff was required to surrender the disputed apartment to Southbridge at the end of his tenancy in exchange for the
refund of his equity, less any charges due plus any capital contributions that were approved (see NYSCEF Document #51, page 4, paragraph20; page 6, paragraph 32). However, in opposition, Plaintiff notes the privatization of the co-op building occurred while Plaintiff still both possessed the apartment and retained an ownership interest (see NYSCEF Document #84, page 2-3, paragraphs 4-7). Indeed, Plaintiff signed an agreement to participate in the privatization of the
building (see NYSCEF Document #84, page 2-3, paragraph 7 and #89, Plaintiffs Exhibit D, Schedule A). Thus, Plaintiffs claimed ownership interest is a vital disputed issue that NMM and Roberts’s documentation fails to definitively refute and requires denial of this branch of the motion. “

Gobindram v Ruskin Moscou Faltischek, P.C., 2019 NY Slip Op 06190
Decided on August 21, 2019  Appellate Division, Second Department stand for the proposition that when an attorney has a second chance to correct mistakes and fails to do so, a claim for legal malpractice may be good.

“The defendants represented the plaintiff in connection with his filing of a voluntary bankruptcy petition in federal court in August 2011. Although the Statement of Financial Affairs (hereinafter SOFA) form appended to the petition called for the disclosure of recent payments to creditors and insiders, the plaintiff failed to report such payments he made to creditors and to his wife from 2010 tax refunds he had received in May and June 2011. Rather, the SOFA indicated that no such payments were made. The plaintiff’s signature on the SOFA was preceded by the following statement: “I declare under penalty of perjury that I have read the answers contained in the foregoing statement of financial affairs and any attachments thereto and that they are true and correct.” Shortly after the commencement of the proceeding, the bankruptcy trustee requested an accounting of the transfers that had disposed of the plaintiff’s 2010 tax refunds, and the omissions in the SOFA then came to light. In November 2011, two of the plaintiff’s major creditors commenced an adversary proceeding in the Bankruptcy Court, contending that the plaintiff should be denied a discharge in bankruptcy based on his misrepresentations in the SOFA relating to the disposition of the 2010 tax refunds. In his defense, the plaintiff argued that the defendants had prepared the bankruptcy submissions and he had relied on them to do so accurately.

At the ensuing trial in the adversary proceeding, the defendants admitted that they had been aware of the plaintiff’s transfers of his 2010 tax refunds at the time they prepared the bankruptcy petition and had erroneously checked boxes marked “none” where the SOFA called for their disclosure. The plaintiff admitted that the defendants had provided him with a copy of the draft petition to review before they filed it and that he had represented to them that he had read it and that it was accurate, and that he had signed the verification line of the petition declaring that it was true and correct despite the fact that he had not actually read the petition in its entirety before signing.”

“However, we disagree with the Supreme Court’s determination granting that branch of the defendants’ motion which was to dismiss so much of the legal malpractice cause of action as sought to recover damages for the defendants’ failure to amend the bankruptcy petition. The findings of the federal courts regarding the knowing and fraudulent conduct on the plaintiff’s part related solely to the initial filing; they made no determination that the plaintiff acted knowingly and fraudulently in failing to file an amended petition. Accordingly, that part of the plaintiff’s legal malpractice cause of action is not subject to dismissal on the grounds of collateral estoppel and in pari delicto.

As an alternative ground for affirmance (see Parochial Bus Sys. v Board of Educ. of City of N.Y., 60 NY2d 539, 545-546), the defendants contend that the legal malpractice cause of action should have been dismissed in its entirety pursuant to CPLR 3211(a)(7), since the parties’ evidentiary submissions on the motion established that the plaintiff hired subsequent counsel who had ample opportunity to rectify their alleged error in this regard (see e.g. Perks v Lauto & Garabedian, 306 AD2d 261, 262). This contention lacks merit.”

Legal malpractice cases are especially prone to statute of limitations defenses, as the consequences of the departure from good practice may not come up for a while.  The standard is rather strict.  As we see in Webster v Sherman, 2018 NY Slip Op 06590 [65 AD3d 738] October 3, 2018 Appellate Division, Second Department  the statute begins to run at the time of the mistake.  “However, as an alternate ground for affirmance, T&L contends, as it did in the Supreme Court, that this cause of action is barred by the statute of limitations. “In moving to dismiss a cause of action pursuant to CPLR 3211 (a) (5) as barred by the applicable [statute of] limitations period, a defendant bears the initial burden of demonstrating, prima facie, that the time within which to commence the action has expired” (Hohwald v Farm Family Cas. Ins. Co., 155 AD3d 1009, 1010 [2017] [internal quotation marks omitted]; see Wells Fargo Bank, N.A. v Eitani, 148 AD3d 193, 197 [2017]). “If the defendant meets this initial burden, the burden shifts to the plaintiff to raise a question of fact as to whether the statute of limitations has been tolled, an exception to the limitations period is applicable, or the plaintiff actually commenced the action within the applicable limitations period” (Amrusi v Nwaukoni, 155 AD3d 814, 816 [2017] [internal quotation marks omitted]; see Shah v Exxis, Inc., 138 AD3d 970, 971 [2016]).

The statute of limitations for a cause of action alleging legal malpractice is three years [*3]from the accrual of the cause of action (see CPLR 214 [6]; Quinn v McCabe, Collins, McGeough & Fowler, LLP, 138 AD3d 1085, 1086 [2016]; Farage v Ehrenberg, 124 AD3d 159, 163 [2014]). “Accrual is measured from the commission of the alleged malpractice, when all facts necessary to the cause of action have occurred and the aggrieved party can obtain relief in court . . . regardless of when the operative facts are discovered by the plaintiff” (Farage v Ehrenberg, 124 AD3d at 164 [citations omitted]; see McCoy v Feinman, 99 NY2d 295, 301 [2002]; Quinn v McCabe, Collins, McGeough & Fowler, LLP, 138 AD3d at 1086).”