Legal Malpractice

…Court held that collateral estoppel (issue preclusion) barred a legal malpractice action

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In Sang Seok Na v Schietroma, 2019 NY Slip Op 04017 [2d Dept May 22, 2019], court held that collateral estoppel (issue preclusion) barred a legal malpractice action, holding:

A plaintiff in an action alleging legal malpractice must prove that the defendant attorney’s failure to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession proximately caused the plaintiff to suffer damages (see Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d 438, 442, 835 N.Y.S.2d 534, 867 N.E.2d 385; Sang Seok NA v. Schietroma, 163 A.D.3d at 598, 79 N.Y.S.3d 636). To establish proximate causation, the plaintiff must show that he or she would have prevailed in the underlying action or would not have incurred any damages, but for the defendant attorney’s negligence (see Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d at 442, 835 N.Y.S.2d 534, 867 N.E.2d 385; Kluczka v. Lecci, 63 A.D.3d 796, 797, 880 N.Y.S.2d 698).

Here, the Schietroma defendants established their entitlement to summary judgment dismissing the complaint on the ground that this action was barred by the doctrine of collateral estoppel (see Karimian v. Time Equities, Inc., 164 A.D.3d 486, 489, 83 N.Y.S.3d 227). “ The doctrine of collateral estoppel, a narrower species of res judicata, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided against that party or those in privity, whether or not the tribunals or causes of action are the same ” (Ryan v. New York Tel. Co., 62 N.Y.2d 494, 500, 478 N.Y.S.2d 823, 467 N.E.2d 487). The doctrine of collateral estoppel applies when: “ (1) the issues in both proceedings are identical, (2) the issue in the prior proceeding was actually litigated and decided, (3) there was a full and fair opportunity to litigate in the prior proceeding, and (4) the issue previously litigated was necessary to support a valid and final judgment on the merits ” (Conason v. Megan Holding, LLC, 25 N.Y.3d 1, 17, 6 N.Y.S.3d 206, 29 N.E.3d 215 [internal quotation marks omitted] ).

In order for the plaintiff to recover damages for legal malpractice against the Schietroma defendants based on their alleged failure to advise him of a potential legal malpractice claim against S & M, the plaintiff must prove that he would have prevailed in a legal malpractice action against S & M, but for the Schietroma defendants’ negligence. In order for the plaintiff to prevail in a legal malpractice action against S & M, the plaintiff must prove that he would have prevailed in the Greyhound action, but for S & M’s negligence.

The issue of whether the plaintiff would have succeeded on the merits in the Greyhound action was raised, necessarily decided, and material in the first legal malpractice action, and the plaintiff had a full and fair opportunity to litigate the issue in that action (see Sang Seok NA v. Schietroma, 163 A.D.3d 597, 79 N.Y.S.3d 636). Thus, the Schietroma defendants established, as a matter of law, that their alleged negligence did not proximately cause the plaintiff’s damages by showing that the plaintiff would not have prevailed in a legal malpractice action against S & M, and that they were entitled to summary judgment dismissing the complaint based on the doctrine of collateral estoppel (see generally Lamberti v. Plaza Equities, LLC, 161 A.D.3d 841, 841–842, 73 N.Y.S.3d 901; Matter of Trump Vil. Apts. One Owner v. New York State Div. of Hous. & Community Renewal, 143 A.D.3d 996, 40 N.Y.S.3d 157). Accordingly, we agree with the Supreme Court’s determination to grant the Schietroma defendants’ motion for summary judgment dismissing the complaint.

R. A. Klass
Your Court Street Lawyer

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It is important for a retainer agreement…

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It is important for a retainer agreement to set forth the tasks that the attorney will perform on behalf of the client, as well as those which are outside of the tasks to be performed. This was emphasized in the following decision of Keld v Giddins Claman, LLP, 170 AD3d 589 [1st Dept 2019]:

The retainer agreement entered into by plaintiff and defendant law firm constitutes documentary evidence which utterly refutes plaintiff’s claims (see generally Leon v. Martinez, 84 N.Y.2d 83, 88, 614 N.Y.S.2d 972, 638 N.E.2d 511 [1994]; CPLR 3211[a][1] ). The scope of services defendant was to provide plaintiff in connection with her purchase of a condominium unit was clearly limited by the retainer agreement. The retainer agreement enumerated the legal services defendants would provide including the review, preparation, and/or negotiation of specific documents related to the closing and the investigation and analysis of issues relating to title. Plaintiff’s allegation that the agreement required defendants to manage all aspects of the purchase including advising on inspections for safety, quality of renovation and environmental issues is without merit. These duties are outside the scope of the retainer (see AmBase Corp. v. Davis Polk & Wardwell, 8 N.Y.3d 428, 435, 834 N.Y.S.2d 705, 866 N.E.2d 1033 [2007] ). Thus, plaintiff cannot maintain a legal malpractice claim against defendants.

R. A. Klass
Your Court Street Lawyer

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Critical to a legal malpractice action that the plaintiff prove the “ case within a case ”

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It is critical to a legal malpractice action that the plaintiff prove the “ case within a case ” in order to sue an attorney. In Salans LLP v VBH Properties S.R.L., 2019 NY Slip Op 02611 [1st Dept Apr. 4, 2019], the court held:

plaintiff demonstrated prima facie entitlement to judgment in the legal malpractice counterclaim by showing that defendants could not prove that but for plaintiff’s failure to appear at the TRO hearing the hearing court would have denied the TRO or set a shorter return date (see Weil, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 A.D.3d 267, 272, 780 N.Y.S.2d 593 [1st Dept. 2004] [holding that to establish a claim for litigation malpractice the client “ must meet the ‘ case within a case ’ requirement, demonstrating that ‘ but for ’ the attorney’s conduct the client would have prevailed in the underlying matter or would not have sustained any ascertainable damages ”] ). Defendants speculate that had plaintiff appeared at the TRO hearing, injunctive relief may have been denied or the hearing court may have adjourned the case to an earlier date. Such speculation is insufficient to sustain a claim for legal malpractice (see Freeman v. Brecher, 155 A.D.3d 453, 453, 64 N.Y.S.3d 13 [1st Dept. 2017]; Brooks v. Lewin, 21 A.D.3d 731, 734–735, 800 N.Y.S.2d 695 [1st Dept. 2005], lv denied 6 N.Y.3d 713, 816 N.Y.S.2d 749, 849 N.E.2d 972 [2006] ).

R. A. Klass
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If there has been a demonstration that the attorney-client relationship in a matter ceased…

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While the continuous representation doctrine can toll a time-barred cause of action for legal malpractice, if there has been a demonstration that the attorney-client relationship in a matter ceased, the time within which to bring such action will accrue then, as held in Sclafani v Kahn, 169 AD3d 846 [2d Dept 2019]: An action to recover damages for legal malpractice must be commenced within three years of accrual, “ regardless of whether the underlying theory is based in contract or tort ” (CPLR 214[6]; see McCoy v. Feinman, 99 N.Y.2d 295, 301, 755 N.Y.S.2d 693, 785 N.E.2d 714; Chase Scientific Research v. NIA Group, 96 N.Y.2d 20, 725 N.Y.S.2d 592, 749 N.E.2d 161; Quinn v. McCabe, Collins, McGeough & Fowler, LLP, 138 A.D.3d at 1086, 30 N.Y.S.3d 288; Alizio v. Ruskin Moscou Faltischek, P.C., 126 A.D.3d at 735, 5 N.Y.S.3d 252; Farage v. Ehrenberg, 124 A.D.3d 159, 163, 996 N.Y.S.2d 646; Landow v. Snow Becker Krauss, P.C., 111 A.D.3d at 796, 975 N.Y.S.2d 119). “ A cause of action to recover damages for legal malpractice accrues when the malpractice is committed, not when it is discovered ” (Alizio v. Ruskin Moscou Faltischek, P.C., 126 A.D.3d at 735, 5 N.Y.S.3d 252; see McCoy v. Feinman, 99 N.Y.2d at 301, 755 N.Y.S.2d 693, 785 N.E.2d 714; Quinn v. McCabe, Collins, McGeough & Fowler, LLP, 138 A.D.3d at 1086, 30 N.Y.S.3d 288; Farage v. Ehrenberg, 124 A.D.3d at 164, 996 N.Y.S.2d 646; Landow v. Snow Becker Krauss, P.C., 111 A.D.3d at 796, 975 N.Y.S.2d 119). However, “ [t]he continuous representation doctrine serves to toll the statute of limitations and render timely an otherwise time-barred cause of action for legal malpractice, but ‘ only where there is a mutual understanding of the need for further representation on the specific subject *121 matter underlying the malpractice claim ’ ” (King Tower Realty Corp. v. G & G Funding Corp., 163 A.D.3d 541, 543, 79 N.Y.S.3d 289, quoting McCoy v. Feinman, 99 N.Y.2d at 306, 755 N.Y.S.2d 693, 785 N.E.2d 714; see Alizio v. Ruskin Moscou Faltischek, P.C., 126 A.D.3d at 735, 5 N.Y.S.3d 252). For the doctrine to apply, “ there must be clear indicia of ‘ an ongoing, continuous, developing, and dependent relationship between the client and the attorney ’ ” (Farage v. Ehrenberg, 124 A.D.3d at 164, 996 N.Y.S.2d 646, quoting Aseel v. Jonathan E. Kroll & Assoc., PLLC, 106 A.D.3d 1037, 1038, 966 N.Y.S.2d 202; see Quinn v. McCabe, Collins, McGeough & Fowler, LLP, 138 A.D.3d at 1086, 30 N.Y.S.3d 288). Here, the defendants established that the plaintiffs’ legal malpractice cause of action was time-barred, as it accrued on June 24, 2009, at the conclusion of the closing (see Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d 438, 442, 835 N.Y.S.2d 534, 867 N.E.2d 385). In opposition to the defendants’ respective motions, the plaintiffs failed to raise a question of fact as to whether the continuous representation doctrine tolled the applicable statute of limitations. Indeed, the communications between the parties upon which the plaintiffs rely, which occurred after the statute of limitations had run, demonstrated that the attorney-client relationship in this matter had ceased at the conclusion of the closing, and was not continued.

R. A. Klass Your Court Street Lawyer

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Defendant moving to dismiss an action must prove the merits of its case

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Bakcheva v Law Offices of Stein & Assoc., 2019 NY Slip Op 00844 [2d Dept Feb. 6, 2019] is a good reminder that a defendant moving to dismiss an action must prove the merits of its case. The court held:

A plaintiff seeking to recover damages for legal malpractice must prove that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, and that the breach of this duty proximately caused the plaintiff to sustain actual and ascertainable damages (see McCoy v. Feinman, 99 N.Y.2d 295, 301–302, 755 N.Y.S.2d 693, 785 N.E.2d 714; Biberaj v. Acocella, 120 A.D.3d 1285, 1286, 993 N.Y.S.2d 64). A defendant seeking summary judgment dismissing a legal malpractice cause of action has the burden of establishing prima facie that he or she did not fail to exercise such skill and knowledge, or that the claimed departure did not proximately cause the plaintiff to sustain damages (see Iannucci v. Kucker & Bruh, LLP, 161 A.D.3d 959, 960, 77 N.Y.S.3d 118; Betz v. Blatt, 160 A.D.3d 696, 698, 74 N.Y.S.3d 75). The defendant must affirmatively demonstrate the merits of a defense, rather than merely pointing out gaps in the plaintiff’s proof (see Iannucci v. Kucker & Bruh, LLP, 161 A.D.3d at 960, 77 N.Y.S.3d 118).

We agree with the Supreme Court that the defendants were not entitled to summary judgment dismissing the legal malpractice cause of action. Although the defendants established their prima facie entitlement to judgment as a matter of law, the plaintiff raised a triable issue of fact in opposition. Specifically, the plaintiff submitted evidence that she had informed the defendants, prior to the closing, that the main portion of the apartment was on the seventh floor of the building and that the apartment included a second level. According to the plaintiff, the defendants committed malpractice because they failed to recognize the illegality of the second level, since neither the certificate of occupancy nor the approved condominium offering plan authorized the existence of an eighth floor to the condominium.

R. A. Klass
Your Court Street Lawyer

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