Client hires attorney to do Surrogate’s Court case.  Attorney hires CPA to do Estate tax returns.  CPA fails to file the returns timely and loses a six-figure refund on the statute of limitations.  CPA is sued and motion practice follows.  In Mazur Carp & Rubin, P.C. v Cohen & Schaeffer, C.P.A., P.C.  2019 NY Slip Op 31735(U)  June 18, 2019  Supreme Court, New York County    Docket Number: 153583/2014  Judge: Kathryn E. Freed mostly finds for Plaintiff.

“Plaintiffs Mazur Carp & Rubin, P.C. (“Mazur CarP”), Karen Cashman (“Cashman”), and David Gallagher (“Gallagher”) move, pursuant to CPLR 3212, for summary judgment on their causes of action for accounting malpractice and breach of1:contract. They further move to dismiss the counterclaims of defendant Cohen & Schaeffer, C.P.A., P.C. (“Cohen & Schaeffer”). Cohen & Schaeffer opposes the motion and cross-moves, pursuant to CPLR 3212, for summary judgment
on its counterclaims. Plaintiffs oppose the cross-motion. After oral argument, and after reviewing
the parties’ papers and the relevant statutes and caselaw, it is ordered that the motion and cross
motion are decided as follows.”

“The first issue before this Court is whether plaintiffs have established a prima facie case of
accounting malpractice against Cohen & Schaeffer. This Court finds that plaintiffs have done so.
“A claim of professional negligence requires proof that there was a departure from accepted
standards of practice and that the departure was a proximate cause of [plaintiff’s] injury.” (D.D .
Hamilton Textiles, Inc. v Estate of Mate, 269 AD2d 2 I 4, 215 [1st Dept 2000].) Plaintiffs’ expert
witness, Basile, identifies several provisions of Title 31 of the Code of Federal Regulations from
which Cohen & Schaeffer may have departed. (Doc. 22.) Specifically, Basile cites § 10.36 of the
statute, which provides that accounting firms shall have “adequate procedures” to ensure
compliance with regulations governing accounting standards and practices. (Id. at 7-8.) Plaintiffs
have further shown that there was a substantial lapse in comunication between them and Cohen
& Schaeffer (Doc. 16 at 25), and that Cohen & Schaeffer produced the prepared tax return in April
of 2012 (Doc. 8 at 9), over one year after the statute of limitations for a federal tax refund had run. Because the estate would have received a refund but for Cohen & Schaeffer’s late preparation of
Grant’s individual taxes, plaintiffs have established their prima facie case on their first cause of
action for accounting malpractice. ”

“The last issue before this Court is whether Cohen & Schaeffer’s counterclaims for breach
of contract and negligence should be dismissed. (Doc. 8 at 18-20.) As previously discussed, the
breach of contract claim is dismissed pursuant to CPLR 3211 (a)( 1 ). Thus, the only remaining issue
is whether Cohen & Schaeffer’s counterclaim for negligence must be dismissed. “To prevail on a negligence cause of action, a [party] must establish the existence of a legal duty, a breach of that duty, proximate causation, and damages.” (MVB Collision, Inc. v Allstate Ins. Co., 129 AD3d I 041, 1042 [2d Dept 2015].) This Court cannot ascertain, based on the papers, what, if any, damages Cohen & Schaeffer has suffered; if any party has suffered damages in this litigation, it is the estate. Moreover, in asserting its counterclaims in its answer, Cohen & Schaeffer did not allege that it sustained damages. (Doc. 11 at 5-6.) Rather, defendant pleaded as follows:
“Consequently, plaintiff … is obligated to pay any damages, including but not limited to any ‘lost’
refunds that might, otherwise, have inured to the benefit: of, inter alia, the Estate of LUCIE
MACKEY GRANT.” (Id. at 6.) Thus, Cohen & Schaeffer’s own pleading suggests that it is the estate which has sustained damages. Thus, the branch of Mazur Carp’s motion seeking to dismiss the counterclaim for negligence is granted pursuant to CPLR 321 l(a)(l). “

Departure, Proximate Cause and Ascertainable Damages are the holy triumvirate of legal malpractice.  Miami Capital, LLC v Hurwitz  2019 NY Slip Op 05332  Decided on July 2, 2019
Appellate Division, First Department illustrates what happens when one or more of these elements are missing, or at best, speculative.

“Defendant’s motion was properly granted because while plaintiff anticipates that it could be subject to a rescission claim at some point in the future, such alleged damages are purely speculative and not yet ripe. Since damages in a legal malpractice case are designed “to make the injured client whole” (Campagnola v Mulholland, Minion & Roe, 76 NY2d 38, 42 [1990]), having failed to plead actual damages, plaintiff’s complaint fails to state a claim (see Heritage Partners, LLC v Stroock & Stroock & Lavan LLP, 133 AD3d 428 [1st Dept 2015], lv denied 27 NY3d 904 [2016]; Lavanant v General Acc. Ins. Co. of Am., 212 AD2d 450 [1st Dept 1995]).

Plaintiff has also failed to establish defendant’s negligence by alleging that he did not exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession (see O’Callaghan v Brunelle, 84 AD3d 581 [1st Dept 2011], lv denied 18 NY3d 804 [2012]). The contract of sale placed the burden on the seller to obtain any necessary court approval for the sale of its property. As seller’s counsel advised defendant that the seller did not need court approval because the property was not “substantially all” of its assets (see N-PCL 510), plaintiff has not adequately pled that defendant breached his duty of care as its lawyer by not obtaining court approval for the sale.”

 

Kislev Partners, LLP v Sidley LLP  2019 NY Slip Op 31850(U)  June 27, 2019 Supreme Court, New York County Docket Number: 152739/2018 Judge: Saliann Scarpulla is an example of a multi-million dollar tax shelter fraud case in which Plaintiffs waited too long to sue.

“Plaintiffs claim that, in late 2002, they identified a potential real estate project in Lower  Manhattan. They anticipated earning substantial profits on the project, which ultimately resulted in a “16-story residential tower designed by the renowned architect Richard Meier.” To shield themselves from tax liability on those profits, plaintiffs decided to acquire the project property through an entity that possessed embedded tax losses (complaint, ~~ 2, 5).

Plaintiffs were allegedly introduced to the idea of using a tax shelter to acquire the property by Lance Valdez (“Valdez”). Valdez convinced plaintiffs that, rather than acquire the property directly, they should instead assign the right to purchase the property to Valdez and ultimately close through Valdez’s entity, Kislev. “In convincing Plaintiffs that the tax aspects of purchasing Kislev worked, Valdez relied heavily on a pre-prepared Sidley Opinion addressed to Kislev, which exhaustively detailed purported facts surrounding Kislev’s formation and operation” (complaint,~ 5).

With respect to the Sidley opinion letter (the “Opinion Letter”), plaintiffs allege: “In or around July 2001, Valdez and Sidley developed a “Reliance Opinion” addressed to Valdez and entities controlled by Valdez, which opined on the ‘tax bases’ allegedly held by the Valdez entities” (complaint,~ 33). According to plaintiffs, Valdez shared with them the Opinion Letter, which concluded that Kislev had a $142 million tax basis in Euros and that it would incur an ordinary loss in that amount upon sale of the Euros. “Unknown to Plaintiffs, Valdez retained Sidley more than a year and half before the transaction to create the legal opinion for Kislev Partners, which he intended to use to
market to clients at a later date” (complaint, if 5).

Of this alleged scheme between Sidley and Valdez, plaintiffs allege that, unknown to them, but known to Sidley lawyers, the Opinion Letter could not support the supposed tax treatment represented, including in particular the claimed basis in Euros purportedly held by Kislev and sold to plaintiffs. Plaintiffs allege that Valdez provided a copy of the Opinion Letter to them to induce them to pay Valdez the $5,000,000 fee he demanded. Plaintiffs further allege that, at their request, Sidley made various changes to the Opinion Letter, including agreeing to change the addressee of the original Opinion Letter from Valdez to “To Whom It May Concern” at Kislev Partners address.” ”

“”‘The test as to when a plaintiff should have discovered an alleged fraud is an objective one.’ Thus ‘plaintiffs will be held to have discovered the fraud when it is established that they were possessed of knowledge of facts from which [the fraud] could be reasonably inferred”‘ (Gorelick v Vorhand, 83 AD3d 893, 894 [2d Dept 2011 ]). On a motion to dismiss, the burden is on the defendant to establish that plaintiff discovered the fraud or was on inquiry notice of the fraud more than two years prior to the commencement of the action:
[W]here the circumstances are such as to suggest to a person of ordinary
intelligence the probability that he has been defrauded, a duty of inquiry
arises, and if he omits that inquiry when it would have developed the truth,
and shuts his eyes to the fact which call for investigation, knowledge of the
fraud will be imputed to him.
(Aozara Bank, Ltd. V Credit Suisse Group, 144 AD3d 437, 438 [1st Dept 2016][intemal
quotation marks and citations omitted]).

“A court may find that plaintiffs were on inquiry notice where there is information concerning the fraudulent acts available to the plaintiffs in the public domain (Aldrich v March & McLennan Cos., Inc., 52 AD3d 435, 436 [1st Dept 2008][“a finding that plaintiffs were on inquiry notice of the alleged fraud … is supported by the extensive information that was available to plaintiffs in the public domain. Such information included the lawsuits commenced in the early 1980’s … involving nondisclosure of material information”).

Moreover, plaintiffs, according to their own submissions, had actual notice of the alleged fraud in September 2012 when they settled with the IRS. It was not until December of 2014, more than two years later, that the parties entered into the tolling agreement. Plaintiffs commenced this action in March of2018. Thus, under either standard of actual or inquiry notice, plaintiffs’ fraud;.. based claims are time-barred.

Like the fraud-based claims, plaintiffs’ unjust enrichment claim is barred by the applicable statutes oflimitations. Accordingly, I grant Sidley’s motion to dismiss, pursuant to CPLR 3211 (a) (5) and dismisses the complaint in its entirety as against it.”

While it is fine and well to identify a departure from good practice, it is similarly necessary to prove all the elements of legal malpractice.  Even more important, it is necessary to follow motion practice and procedures.

Karimian v Karlin  2019 NY Slip Op 05193  Decided on June 27, 2019  Appellate Division, First Department is a good example.

“Plaintiff failed to demonstrate a reasonable excuse for his default in responding to defendants’ motion to dismiss the complaint (CPLR 5015[a][1]; see Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141 [1986]). His proffered excuse, namely, that he thought his deadline for opposing the motion had been postponed indefinitely pending the court’s decision on his motion to seal the court file, is belied by the record. Plaintiff’s opposition papers were due October 13, 2017, and plaintiff concedes that defendants had refused to consent to a further extension of that deadline. Nevertheless, plaintiff waited until October 13 to request an extension of time, in his order to show cause to seal the court file. The motion court struck that relief when it signed the order to show cause. The other events that plaintiff claims sowed confusion in his mind occurred after the deadline for filing opposition papers had passed. Plaintiff’s status as a self-represented litigant does not alter this analysis (see Matter of Kent v Kent, 29 AD3d 123, 130-31 [1st Dept 2006]). Plaintiff recognized that his opposition papers would not be completed by the deadline, but, instead of submitting incomplete papers, he chose to rely on his optimistic belief that the court would grant his eleventh hour request for an extension of time.

We note that plaintiff also failed to demonstrate a meritorious defense to the motion to dismiss. He failed to show that his legal malpractice claims premised on defendants’ representation of him in the United States District Court for the Southern District of New York were not time-barred (see McCoy v Feinman, 99 NY2d 295, 300, 306 [2002]). He failed to show that his breach of fiduciary duty claims were not time-barred (see Block 2829 Realty Corp. v Community Preserv. Corp., 148 AD3d 567 [1st Dept 2017]; Access Point Med., LLC v Mandell, 106 AD3d 40, 45 [1st Dept 2013]). Although his legal malpractice claims premised on defendants’ representation of him in the United States Court of Appeals for the Second Circuit arguably were timely and not barred by collateral estoppel, plaintiff failed to show that defendants’ alleged failures caused him to lose on that appeal (see Brooks v Lewin, 21 AD3d 731, 734 [1st Dept 2005], lv denied 6 NY3d 713 [2006]). Plaintiff’s cause of action for “Concealment and Failure to Self Report” is not viable because “there is no private right of action against an attorney or law firm for violations of the Code of Professional Responsibility or disciplinary rules” (Weinberg v Sultan, 142 AD3d 767, 769 [1st Dept 2016]).”

 

Many people take a look at a legal malpractice situation and stop after identifying a departure.  In more common language, after finding a mistake, the analysis ends.  Failure to identify and have all elements of legal malpractice will lead to failure. Sapienza v Becker & Poliakoff  2019 NY Slip Op 05218 Decided on June 27, 2019 Appellate Division, First Department is an example:

“Plaintiff’s fraud claim was properly dismissed, as plaintiff did not allege “actual pecuniary loss sustained” by plaintiff’s decedent individually “as the direct result of” defendants’ alleged fraud (Lama Holding Co. v Smith Barney, 88 NY2d 413, 421 [1996] [internal quotation marks omitted]), with “the requisite particularity under CPLR 3016(b)” (Eurycleia Partners, LP v Seward & Kissel, LLP, 12 NY3d 553, 559 [2009]). The alleged “lost opportunity” damages are too speculative to support a recovery, since a plaintiff cannot be compensated under a fraud cause of action “for what [he] might have gained” (Connaughton v Chipotle Mexican Grill, Inc., 29 NY3d 137, 142 [2017] [internal quotation marks omitted]).

The legal malpractice claim was also properly dismissed. Plaintiff did not allege “actual, ascertainable damages” incurred by plaintiff’s decedent “as a result of an attorney’s negligence” (Dempster v Liotti, 86 AD3d 169, 177 [1st Dept 2011]; see Humbert v Allen, 89 AD3d 804, 806 [2d Dept 2011]).”

Urias v Daniel P. Buttafuoco & Assoc., PLLC  2019 NY Slip Op 05180 Decided on June 26, 2019 Appellate Division, Second Department speaks about Judiciary Law § 487 and legal malpractice.  In this summary judgment case, the legal malpractice claims remain in view of opposing experts.  The JL claims are dismissed.

“The plaintiff commenced this action, inter alia, to recover damages for legal malpractice. The defendants Daniel P. Buttafuoco & Associates, PLLC, and Daniel P. Buttafuoco (hereinafter together the Buttafuoco defendants) represented the plaintiff in a medical malpractice action in Suffolk County, which resulted in a settlement agreement, and in which the Buttafuoco defendants were awarded a certain sum of attorney’s fees that was confirmed by the Supreme Court, Suffolk County. The defendant John Newman represented the plaintiff in a guardianship proceeding in Nassau County, which also resulted in an approval of the settlement and award of attorney’s fees in the medical malpractice action by the Supreme Court, Nassau County. In this action, the plaintiff alleges, among other things, that the Buttafuoco defendants and Newman were negligent in their representation of the plaintiff and that the Buttafuoco defendants committed fraud and violated [*2]Judiciary Law § 487 with respect to their recovery of attorney’s fees. The first through fifth causes of action seek damages from the Buttafuoco defendants, alleging a violation of Judiciary Law § 487, breach of fiduciary duty, breach of the retainer agreement, conversion of the settlement proceeds and fraud, and fraud, respectively. The sixth cause of action seeks damages from the Buttafuoco defendants and Newman for legal malpractice.”

“The second and third causes of action, which allege breach of fiduciary duty and breach of contract, respectively, were duplicative of the legal malpractice cause of action, since those causes of action are based on the same facts and do not allege distinct damages (see Pacella v Town of Newburgh Volunteer Ambulance Corps. Inc., 164 AD3d 809, 814; Balan v Rooney, 152 AD3d 733, 734; Ferrigno v Jaghab, Jaghab & Jaghab, P.C., 152 AD3d 650, 654; Federico v Brancato, 144 AD3d 965, 967). In addition, the first, fourth, and fifth causes of action, alleging a violation of Judiciary Law § 487, conversion of the settlement proceeds and fraud, and fraud, respectively, concern whether the Buttafuoco defendants engaged in fraudulent conduct in obtaining an award of attorney’s fees in the medical malpractice action. The plaintiff’s remedy for those alleged acts “lies exclusively in that lawsuit itself, i.e., by moving pursuant to CPLR 5015 to vacate the civil judgment due to its fraudulent procurement, not a second plenary action collaterally attacking the judgment in the original action” (Yalkowsky v Century Apts. Assoc., 215 AD2d 214, 215; see Chibcha Rest., Inc. v David A. Kaminsky & Assoc., P.C., 102 AD3d 544, 545; Parker & Waichman v Napoli, 29 AD3d 396, 399; North Shore Envtl. Solutions, Inc. v Glass, 17 AD3d 427). Accordingly, we agree with the Supreme Court’s determination granting those branches of the Buttafuoco defendants’ motion which were for summary judgment dismissing the first through fifth causes of action, and denying those branches of the plaintiff’s cross motion which were for summary judgment on the issue of liability on the second and third causes of action.

We also agree with the Supreme Court’s determination denying that branch of the plaintiff’s cross motion which was for summary judgment on the sixth cause of action, to recover damages for legal malpractice, insofar as asserted against the Buttafuoco defendants. There are conflicting opinions in the expert affirmations as to whether the Buttafuoco defendants failed to exercise the degree of reasonable skill and competence commonly possessed by an ordinary member of the legal profession and thereby caused harm to the plaintiff (see generally 762 Westchester Ave. Realty, LLC v Mavrelis, 167 AD3d 684, 685; Landa v Blocker, 87 AD3d 719, 722; Scartozzi v Potruch, 72 AD3d 787, 788).”

David A. Kaminsky & Assoc., PC v Brenner  2019 NY Slip Op 51028(U)  Decided on June 24, 2019  Appellate Term, First Department presents an unusual situation.  The Appellate Term recognizes that there is a viable legal malpractice claim, but allows summary judgment on fees to be affirmed.

“We sustain the grant of plaintiff’s motion for summary judgment in this action for unpaid legal fees. Plaintiff submitted evidence establishing the reasonable value of its services (see Kwangjin Song v Woods Oviatt Gilman LLP, 55 AD3d 1278 [2008]) and defendant failed to raise a triable issue of fact with respect to plaintiff’s entitlement to the fees sought (see DiPlacidi v Walsh, 243 AD2d 335 [1997]; Pirro & Monsell v Freddolino, 204 AD2d 613 [1994], lv dismissed 85 NY2d 903 [1995]). Nor is summary judgment precluded by defendant’s legal malpractice counterclaim, since the record shows that plaintiff performed a great deal of work that was unrelated to the isolated malpractice claim found viable by the court (see Emery Celli Brinckerhoff & Abady, LLP v Rose, 111 AD3d 453 [2013], lv denied 23 NY3d 904 [2014]; Morrison Cohen Singer & Weinstein v Ackerman, 280 AD2d 355, 356 [2001]).”

Legal malpractice is fascinating, in part, because of the wide range of underlying disputes in which it pops up.  Take for example the Manhattan apartment purchaser.  She wants city views.  She buys into an new development, and does so will prior to completion of the building.  What exactly are city views?  In this case her windows faced north and there were many buildings directly north of her.  There may have been 50 or more blocks of buildings north of her.  The most important were the next three buildings directly north of her.  Two were “low rise.”  Since change is constant in Manhattan real estate, she was worried that they might build up and completely block her view.   In the end it was a 12 story building three blocks north that was at issue.

Her apartment was on the 12th floor.  Would a 12 story building three blocks north ruin the view?  Widlitz v Douglas Elliman, LLC  2019 NY Slip Op 31737(U)  June 21, 2019
Supreme Court, New York County  Docket Number: 154689/2016 Judge: Arlene P. Bluth tells us that while this attorney gets out of the case, others might be liable in similar situations.

“Legal Malpractice
“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. 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, Corker & Sauer, 8 NY3d 438,
442, 835 NYS2d 534 [2007] [internal quotations and citations omitted]).

Plaintiff alleges that Lee committed malpractice by failing to inform her about the apartment’s views and because of Lee’s alleged failure to advise her about any rights to rescind the purchase  agreement. However, the deposition testimony and email exchanges between plaintiff and Lee indicate that plaintiff only asked Lee about any potential air rights that the neighboring buildings had and did not ask about the current status of the view of the apartment she was planning to purchase. Plaintiff states: “So I was concerned that the buildings next to the street, there are like two buildings further north on that street, they were low rise, but I was concerned that potentially one of those could be knocked down and something could be built. That is what I asked him [Lee] to investigate” (NYSCEF Doc. No. 164 at pgs. 87-88). Plaintiff only asked Lee about potential rights that these buildings had with respect to building more stories in the future. This is not the equivalent of asking Lee to investigate whether it was true that her apartment would have city
views.

Plaintiff’s testimony does not indicate that she ever asked Lee to ascertain what her apartment views would look like, nor does it indicate that Lee made any misrepresentations which caused plaintiff damages. ”

“This testimony indicates that plaintiff was concerned about possible changes to nearby buildings and wanted to determine whether either of the two low-rise buildings directly to her north (373 and· 375 Broadway) could be built up in the future (what “could change my view”). It does not indicate that plaintiff was concerned about the view her apartment would have upon completion. She never claims to have asked her lawyer to double-check Elliman’ s representations.  That makes sense: she claims she believed Elliman and the drone’s picture and asked her lawyer to investigate air rights of her neighbors between her building and 3 77 Broadway. She believed she had a view-she wanted her lawyer to make sure that view would stay. ”

“Plaintiffs next basis for legal malpractice is that Lee failed to timely inform her of her alleged right to rescind her purchase agreement on May 15, 2015. In an email sent to Lee, plaintiff expressed concern that the construction was taking too long and asked if she could get out of her contract to purchase the apartment. In response Lee told plaintiff that since her arrangement with Hashem was an assignment, they would have to talk to Hashem directly. But plaintiff does not show that she ever followed up to request that Lee communcate with Hashem to try to cancel the arrangement. Therefore, this cannot serve as a basis for legal malpractice. “

Expert disclosure in New York is truely a black hole.  The statute does not require much by way of naming the expert.  You have to give the name and a little bit about what the expert will say.  However, the timing is completely up to court discretion.  Here is what one plaintiff did in a pinch.

Mazzurco v Gordon 2019 NY Slip Op 04930  Decided on June 19, 2019 Appellate Division, Second Department allowed plaintiff to pay his way out of a jam.

“During a pretrial conference on September 25, 2017, after jury selection, but before opening statements, at the Supreme Court’s request for a list of his witnesses, the plaintiff, for the first time, identified, among others, a damages expert. The defendants made an application, inter alia, to preclude the testimony of the proposed damages expert for failure to comply with CPLR 3101(d)(1)(i), and, upon such preclusion, to dismiss the complaint. In an order dated October 6, 2017, upon granting the plaintiff’s application for a continuance of the trial conditioned, inter alia, on the payment of the sum of $7,500 by the plaintiff’s counsel to the defendants and/or their counsel, the court denied those branches of the defendants’ application which were to preclude the plaintiff’s damages expert from testifying at trial and to dismiss the complaint upon such preclusion. The defendants appeal.

CPLR 3101(d)(1)(i) requires a party to disclose his or her expert witness and certain expert information when served with a proper demand, but does not require a response at any [*2]particular time or “mandate that a party be precluded from proffering expert testimony merely because of noncompliance with the statute” (Rowan v Cross Country Ski & Skate, Inc., 42 AD3d 563, 564; see Rivers v Birnbaum, 102 AD3d 26, 35; Saldivar v I.J. White Corp., 46 AD3d 660, 661). Trial courts are vested with broad discretion “in making determinations concerning matters of disclosure,” including imposing a penalty on a party for its failure to comply with CPLR 3101(d)(1)(i) (Arpino v F.J.F. & Sons Elec. Co., Inc., 102 AD3d 201, 209; see Rivers v Birnbaum, 102 AD3d at 52; McColgan v Brewer, 84 AD3d 1573, 1576). Generally, preclusion is unwarranted without evidence of intentional or willful failure to disclose and a showing of prejudice by the party seeking preclusion (see Rowan v Cross Country Ski & Skate, Inc., 42 AD3d at 564; Aversa v Taubes, 194 AD2d 580, 582). Here, there was no evidence that the plaintiff’s failure to disclose his damages expert was intentional or willful, and the prejudice to the defendants was alleviated by the Supreme Court’s conditional continuance of the trial to permit completion of expert disclosure along with the imposition of monetary sanctions (see Burbige v Siben & Ferber, 115 AD3d 632, 633, citing Shopsin v Siben & Siben, 289 AD2d 220; Aversa v Taubes, 194 AD2d at 582). Accordingly, the court providently exercised its discretion in denying those branches of the defendants’ application which were to preclude the plaintiff’s damages expert from testifying at trial and to dismiss the complaint upon such preclusion.”

Too speculative is a defense commonly utilized by defendants in legal malpractice settings.  Here, in Birch v Novick & Assoc., P.C.   
2019 NY Slip Op 31712(U) June 14, 2019 Supreme Court, New York County Docket Number: 161445/13, Justice Carol R. Edmead discusses just how speculative they might be.

“Defendants argue that the complaint must be dismissed, as Plaintiff has not sustained any ascertainable damages. Weinblatt, one of the attorney’s Plaintiff hired after losing confidence in
Defendants, who is also a CPA, sent Plaintiff an email on November 21, 2012, stating that her share of her residuary estate, “based upon [Kappenberg] receiving no elective share” was “$1,800, 709 .11 “4 Plaintiff submits no competing computation of what Plaintiff would have been awarded if she successfully challenged Kappenberg’ s right of election.

Since Plaintiff ultimately received $2.3 in the settlement, Defendants argue that she cannot show actual damages. Hochberg_, Defendants’ counsel, opines: “Plaintiff received a surplus of approximately $500,000 as a result of the efforts of (Defendants] and co-counsel .. I am advised that … Plaintiff seeks … to recover legal fees she paid in the amount of $331,699.59 …. [T]aking Plaintiff’s claims at face value, the extra $500,00 [Defendants] obtained for Plaintiff more
than offsets the totality of the legal fees paid by the Plaintiff concerning the Underlying Matter” (NYSCEF doc No. 25-27).

Plaintiff, in opposition, argues that the 1.8 million estimate does not take into account the residual right that Plaintiff would have had in the $2.1 million trust in Kappen berg’s benefit provided for in the 2008 Will. Defendants, in reply, argue that the hypothetical worth of this residual right is impertnissibly speculative and”that Plaintiff waived her claim to any damages related to the residual right by not including it from its second amended damages chart.

Generally, a plaintiff in a legal malpractice action can recover for damages it expended – mitigating the damage of an attorney’s negligence (Kagan Lubic Lepper Finklestein & Gold v 325 Fifth Ave. Condominium, 2015 NY Slip Op. 31470[U] [Sup Ct, NY County, Kern, J][cognizable damages in a legal malpractice action include consequential damages sustained as a result of the attorney’s malpractice, including expenses such as experts fees and attorney’s fees”]). Here; as there are questions of fact relating to negligence, there are concomitant questions of fact related to consequential damages arising from the alleged negligence. That is, a factfinder could find that Defendants were negligent and that Plaintiff expended additional fees to remedy that negligence. In other words, a factfinder could find that, absent negligence, Plaintiff could have attained the $2.3 settlement without having to hire additional attorneys.

Moreover, it would it would be error for the court to determine that Plaintiff could not establish damages based on Weinblatt’s estimate as to the amount Plaintiff would have received under the 2008 Will and the $2.3 million Plaintiffinherited under the settlement. While Defendants argue that Plaintiffs residual right tO’the Kappenberg trust provided for in the 2008 Will is too speculative to serve as a Qasis to deny summary judgment, the estimate that Defendants rely on is also, fundamentally, speculative. Moreover, the question of whether Plaintiff waived any damages claim based on this residual right is a question best reserved for the factfinder. As questions of fact as to damages remain, the branch of Defendants’ motion that seeks dismissal of the complaint as Plaintiff cannot show actual damages must be denied.  “